Senate votes against cuts to Medicaid

Senators voted to undo $15 billion in Medicaid cuts in their budget yesterday, erasing a key limit on entitlement spending President Bush had sought, but also voted to cut taxes more deeply than either the administration proposed or the House passed.

The Senate passed its budget 51-49, and the House passed its budget 218-214.

The two chambers now must square their budgets with each other, a task House Republicans said is more difficult because of the Medicaid funds the Senate added back in.

Failure to reach a budget deal for fiscal year 2006 also would imperil other measures attached to the budget, such as this week’s Senate vote to allow drilling for oil in part of the Arctic National Wildlife Refuge (ANWR).

“So far, I’m not real pleased with what I’m hearing the Senate saying,” said House Budget Committee Chairman Jim Nussle, Iowa Republican.

Seven Senate Republicans joined all the chamber’s Democrats and its lone independent in voting 52-48 to restore the five-year, $15 billion Medicaid reductions included in the budget that passed the Senate Budget Committee.

The amount of Republican support for the amendment left the party’s budget point man despondent.

“Its practical implication is to gut the only thing in this budget which actually will generate fiscal discipline. And it’s being done by Republicans,” said Senate Budget Committee Chairman Judd Gregg, New Hampshire Republican. “You know, you just have to ask yourself how they get up in the morning and look in the mirror.”

Even as the Senate was adding Medicaid funding, the House was including a $20 billion reduction in the program over five years.

Mr. Nussle said the Senate Medicaid vote should be a wake-up call for Mr. Bush on his hopes to achieve reform on bigger issues such as Social Security and taxes, which the president called for in his State of the Union address.

“To me, it’s momentum,” Mr. Nussle said. “If the Senate is not going to follow on the first item on the president’s agenda, then I think that’s a signal that the president needs to receive and react to immediately.”

But those who supported restoring the Medicaid money, who were led by Sen. Gordon H. Smith, Oregon Republican, said the amendment also establishes a commission to study reforming Medicaid, which they said was more responsible than making cuts.

“This is a way to proceed towards fiscal responsibility in a way that is thoughtful,” Mr. Smith said. “It is really important when we talk about a population as vulnerable as we are, those covered by Medicaid, that we do this carefully, that we do it thoughtfully, that we do it right instead of just doing it fast.”

Hours later, senators voted 55-45 to increase the amount of tax cuts allowed in their budget from $70 billion to $134 billion.

Sen. Jim Bunning, Kentucky Republican, said the extra room for tax cuts should be used to reduce income taxes on Social Security income. Democrats, though, said the amendment increases the deficit without specifying that the money, as Mr. Bunning said, would go to erase the unpopular tax on Social Security income.

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