Obama's budget will protect Medicaid funds, with states' expansion of program key to success of health overhaul
WASHINGTON — President Obama's budget next week will steer clear of major cuts to Medicaid, including tens of billions in reductions to the health care plan for the poor that the administration proposed only last year.
Big cuts in the federal-state program wouldn't go over too well at a time that Health and Human Services Secretary Kathleen Sebelius is wooing financially skittish Republican governors to expand Medicaid coverage to millions who are uninsured. That expansion in the states is critical to the success of Obama's health overhaul, which is rolling out this fall and early next year.
The president's budget is to be released on Wednesday.
Perhaps half of the nearly 30 million people gaining health insurance under the law are to be covered through Medicaid. But the Supreme Court last year gave individual states the right to reject the expansion. A principal argument against the expansion in state capitals is that Washington cannot be trusted to keep its promise of generous funding for new recipients.
In recent weeks, senior White House officials have gone out of their way to reassure activists that Medicaid will be protected in the budget.
“Since generous federal funding for the Medicaid expansion is the key inducement for governors to decide to expand their programs, the administration does not want to undermine that inducement by cutting federal Medicaid funding,” said Ron Pollack, executive director of Families USA, an administration ally helping to promote coverage benefits that take effect next year under the law.
Pollack said he has received personal assurances on Medicaid from several senior White House officials. “The Supreme Court decision last June was a game changer for the way the administration views Medicaid budgeting,” he said.
White House officials aren't commenting, but Obama's budget would set up a clear contrast with the Republican-led House. The GOP budget would turn Medicaid over to the states and sharply reduce spending from projected levels. It would repeal the expansion of Medicaid, along with the rest of Obama's health care law.
As far as curbs on Medicare, the other major federal health care program, Obama seems to be searching for compromise with Republicans.
The two sides have floated similar proposals to raise monthly premiums for upper-middle class and wealthy retirees. There's interest in changing Medicare's co-payments and deductibles in ways that would protect the sickest beneficiaries but likely raise costs for others. And while Obama has backed away from raising the eligibility age, he does seem willing to treat new beneficiaries differently by asking them to pay more for some services.