Governors Discuss Whether To Accept Stimulus Funds At National Governors Association Meeting

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Health Insurance / Medical Insurance;  Public Health
Article Date: 24 Feb 2009 - 2:00 PDT

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Republican governors from Alaska, Idaho, Louisiana, Mississippi, South Carolina and Texas have indicated that they might reject portions of the federal stimulus money because they might not want to meet the requirements that accompany the funds or use federal funds to expand programs, such as Medicaid, the New York Times reports (Dewan, New York Times, 2/21).

Some governors have said that the increased federal Medicaid funding will eventually have to be covered by states (Dewan, Pittsburgh Post-Gazette, 2/21). Gov. Mark Sanford (R-S.C.) said, "You may get yourself out of a temporary budget hole, but create another budget hole in the next 24 months" (New York Times, 2/21). However, supporters of the stimulus package say that it does not mandate any permanent expansion of Medicaid eligibility or coverage.

Some Governors Ready To Accept Money
Other Republican governors are eager to receive the federal funding, the Washington Post reports. Florida Gov. Charlie Crist (R) said that his state needs as much federal assistance as possible for programs such as health care, noting that "We plan to utilize it for the people of our state as much as possible," adding, "I'm thinking about people, not politics" (Rucker, Washington Post, 2/22). Gov. Jon Huntsman (R-Utah) said, "Now the stimulus money comes in and it basically allows us to backfill in many of these critical areas," such as health care (Lambert, Reuters/Boston Globe, 2/21).

California Gov. Arnold Schwarzenegger (R) said Sunday that he would willingly accept the federal funds, adding that he is "more than happy" to take the funds of "any other governor in this country that doesn't want to take this money" adding, "I'll take it, because we in California need it" (LoBianco, Washington Times, 2/23). Schwarzenegger added that Republicans nationwide are "not in touch" with the desires of the majority of U.S. residents. He said, "You've got to listen to the people. If the nation is screaming out loud, 'We need health care reform. We want to have universal health care. We want to have everyone insured. We want to bring the costs down. We want everyone to have access' I mean, that's what they want that's what you do" (Hotakainen, McClatchy/Miami Herald, 2/22).

Comments
Gov. Ed Rendell (D-Pa.), chair of the National Governors Association, said on Saturday at the meeting, "In the end ... most of the governors will accept most of the money and use it for the benefit of their citizens" (Reuters/Boston Globe, 2/21). He added that "if the money's there and it will help your citizens get jobs, it will bring your citizens some extra health care or extra food stamps dollars, of course you're going to accept that money" (Washington Post, 2/22).

Democratic and Republican governors pressed for increased flexibility in how the funds are spent in areas such as health care. New Hampshire Gov. John Lynch (D) said, "I think (Obama) needs to trust us and give us the flexibility and the discretion to use the money wisely so that it will create jobs, will avoid layoffs and at the same time help our most vulnerable citizens who depend on the state government" (Rucker, Washington Post, 2/23).

Obama Warns Mayors About Misusing Funds
President Obama on Friday warned mayors at the U.S. Conference of Mayors winter meeting to spend federal stimulus money "wisely, free from politics and free from personal agendas," adding, "On this I will not compromise or tolerate any shortcuts" (James/Meyerson, Los Angeles Times, 2/21). The mayors discussed spending projects they are considering, such as community health centers. They also noted their concern that the funds will not be made available to them by state governments (Stolberg, New York Times, 2/21). Obama said, "If a federal agency proposes a project that will waste that money, I will not hesitate to call them out on it and put a stop to it," adding, "I want everybody here to be on notice ... if a local government does the same, I will call them out on it and use the full power of my office and our administration to stop it" (Los Angeles Times, 2/21).

Obama To Name Head of Stimulus Accountability Board, Calls For Accountability
Obama on Monday will hold a 90-minute meeting with state governors to discuss the economic stimulus package, at which point Obama is expected to name Earl Devaney as head of the new Recovery Act Transparency and Accountability Board (Fouhy, AP/Boston Globe, 2/23). Devaney -- a former Secret Service agent who was inspector general of the Department of the Interior -- will oversee how the government spends the $787 billion in the economic stimulus package, coordinating oversight efforts with Vice President Joe Biden (AP/Richmond Times-Dispatch, 2/23). Valerie Jarrett, a senior adviser to President Obama, said that at the governors meeting the president will call for "accountability, responsibility, metrics for success" (Washington Post, 2/23).

Editorials

• Long Island Newsday: "Whenever this tsunami of acute economic problems finally ebbs, the chronic problem of out-of-control medical costs will take center stage as an impediment to a healthy future," and while "it may take broad reform to fashion an affordable, sustainable health care system ... the effort has to start now," a Newsday editorial states. "Fortunately there are signs" that federal officials and lawmakers "get it," including comparative effectiveness research and health information technology provisions and an expansion of unemployment benefits such as COBRA, in the stimulus bill and the reauthorization and expansion of CHIP signed by Obama, according to Newsday. The editorial concludes, "With the economy in distress, for the time being baby steps toward a more affordable system may be the most we can do. It's also the least we should do" (Long Island Newsday, 2/22).
  
  
• Wall Street Journal: The governors who are "saying thanks but no thanks to some of the $150 billion of 'free' money doled out to states" in the stimulus package are right to do so "because it could make their budget headaches much worse down the line," a Wall Street Journal editorial states. Medicaid funding included in the package "is a fiscal time bomb," the editorial states, because it "temporarily increases the share of state Medicaid bills reimbursed by the federal government by two or three percentage points." According to the Journal, adding that much money "will cover health care costs for unemployed workers and single workers without kids," but "in 2011 almost all the $80 billion of extra federal Medicaid money vanishes." The editorial notes, "Does Congress really expect states to dump one million people or more from Medicaid at that stage?" The governors "deserve credit for blowing the whistle on the federal trap that Washington has set for their budgets," the editorial states, concluding, "Don't be surprised if two years from now states are still facing mountainous deficits. They will have their Uncle Sam to thank" (Wall Street Journal, 2/23).
  

Opinion Piece
Robert Samuelson, Washington Post: "Congress might have done more" with the federal stimulus package "by providing large, temporary block grants to states and localities and letting them decide how to spend the money," Post columnist Samuelson writes. Samuelson continues that the bill "provides most funds through specific programs." He writes that there is "$90 billion more for Medicaid, $12 billion for special education, $2.8 billion for various policing programs," noting, "More power is being centralized in Washington" (Samuelson, Washington Post, 2/23).

CBS' "Face the Nation" on Sunday reported on how state governors plan to manage their share of the economic stimulus package. The segment includes comments from Govs. Jon Corzine (D-N.J.), Mitch Daniels (R-Ind.) and Ted Strickland (D-Ohio) (Schieffer, "Face the Nation," CBS, 2/22).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation.

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