GOP introduces House, Senate legislation to unravel unfunded Medicaid mandates to states

Matthew Boyle Investigative Reporter
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House GOP conference vice chair Rep. Cathy McMorris Rodgers of Washington State, Georgia Republican Rep. Phil Gingrey, and Utah Republican Sen. Orrin Hatch introduced legislation on Tuesday that they say will remove “onerous” Medicaid funding requirements for the states.

They say Medicaid spending “ties the hands of states,” consuming, according to a fiscal survey of the states, an average of 22 percent of state budgets.

The bipartisan National Governors Association says that governors nationwide aren’t asking for a bailout fix from the Treasury Department. “In fact, we encourage the federal government to follow the lead of states and make the tough decisions necessary to get its fiscal house in order,” the NGA said. “Federal fiscal stability is critical to the long-term strength of states and the country.”

Hatch, McMorris Rodgers and Gingrey expect the proposal to get broad bipartisan support. “If they [Democrats] care for their citizens and they care for their budgets, they’re going to be with us on this,” Hatch told reporters at a Tuesday press conference. “This is not a partisan bill.”

The sponsors already have significant Republican support for the bill in both the House and Senate. At the press conference, House Energy and Commerce chairman Rep. Fred Upton, Wyoming Sen. John Barasso, House Energy and Commerce Health Subcommittee Chair Joe Pitts of Pennsylvania and Tennessee Sen. Lamar Alexander joined in introducing the legislation and have each signed on as co-sponsors.

“The federal government has literally said the states have to spend money the states don’t have,” Alexander said at the Tuesday press conference. “The end result of that? They have to find it somewhere else.”

Americans for Tax Reform president Grover Norquist has announced his support for the legislation. “This is a particularly-bad time for states to be prevented from enacting meaningful reforms, since they face a collective over-spending problem of $175 billion, and Medicaid now consumes 22 percent of state budgets,” Norquist wrote in a letter to the sponsoring members. “It’s essential that Medicaid be put on the table as states grapple with reining in the over-spending of past years.  Failure to reform Medicaid in a way that relieves future generations of unfunded spending promises is irresponsible, but Washington telling states they cannot enact these reforms is even worse.”

McMorris Rodgers says the legislation will allow governors flexibility when making their budgets. She said, “everyone recognizes Washington has been spending outside its means.” But she points out that a lot of states have too. “One big cost driver for every state has been the Medicaid requirement coming out of Washington, D.C.,” McMorris said. “In my state of Washington, [Democrat] Gov. [Chris] Gregoire’s budget has taken, like in many other states, a $5 billion shortfall and when I sat down and talked to her about Medicaid, in particular, she said, ‘What we need, Cathy, is flexibility.’”