- The Washington Times - Thursday, November 5, 2009

When the nation’s 28 Democratic governors were asked to send a letter to congressional leaders last month expressing their support for health care reform, seven refused to sign the letter and even some who did complained that the pending reform plans could hit them with budget-busting expenses.

The big concern among the holdouts is that the health care overhaul will leave them on the hook to pay for expansions in Medicaid programs for the poor while Washington reaps the political credit.

Tennessee Gov. Phil Bredesen, one of those who declined to sign the letter, has been perhaps the party’s sharpest critic in the funding debate, calling the potential expansion of Medicaid in health care reform “the mother of all unfunded mandates.”

“We can’t print money. We can’t borrow money. A lot of staffers in Congress really don’t understand this idea of a balanced budget,” Mr. Bredesen, a former HMO executive, told reporters in September.

Costs are also worrying moderate Democrats in the House, where party leaders Wednesday pushed for a quick debate and vote on the $1.2 trillion measure as soon as Saturday. Democrats were buoyed by reports that the giant seniors lobby AARP would endorse their bill Thursday.

The Senate remains a tougher call, with Majority Leader Harry Reid, Nevada Democrat, hinting this week that Congress may miss President Obama’s deadline for passage of a bill by the end of the year.

The Democratic governors who wrote in support of a reform bill said in their letter that they “realize that the status quo is no longer an option.”

“Sky-rocketing health care costs hurt families, force businesses to cut or drop health benefits and cause already strained state budget deficits to significantly grow. We believe reform can relieve these burdens by reining in costs and making coverage more affordable, both for our citizens and our state budgets,” the letter said.

But left out of the letter was any mention of the federal Medicaid health insurance program for the poor, whose shared cost with the states has been the governors’ biggest budget headaches.

The health care plans being considered in Congress are projected to move millions of new health care recipients into Medicaid and add nearly $40 billion to the states’ costs.

New Hampshire Gov. John Lynch, who did not sign the letter, is one of many governors who has been raising concerns that the bills taking shape in Washington will hit his fiscally-strapped state with costs it is unable to meet.

“We’re struggling with our current Medicaid program, which has seen a big increase in demand over the past year. We can’t afford new costs,” Pam Walsh, the Democratic governor’s deputy chief of staff, told the Concord Monitor.

The recession has already driven up Medicaid rolls over the past year, further straining state budgets. New Hampshire officials said 114,862 state residents used Medicaid to help pay health care bills in September, up 10 percent over last year.

According to estimates from the National Conference of State Legislatures, the reform bill approved by the Senate Finance Committee could cost Mr. Lynch’s state $177 million in the program’s first six years, beginning in 2014, as a result of about 83,000 more people who would be added to the state’s Medicaid rolls.

Maryland Gov. Martin O’Malley, who did sign the letter, remains one of the health care plan’s staunchest supporters, but told reporters on ABCNews.com’s “Top Line” program, “Really, a lot of this is about cost-avoidance.”

Mr. O’Malley said last week that when the National Governors Association gathered in Biloxi, Miss., in July for its annual meeting, “We all came together to say, A) we really need health care reform, and, B) none of us want to pay for it.”

Arkansas Gov. Mike Beebe, who did not sign the letter, is staying out of the federal fight for now, but is closely watching what happens on the Medicaid front, Beebe spokesman Matt DeCample said.

“Medicaid is where you potentially see the burden on the states. It’s not at any point where we are shouting alarms, but it’s something to be wary of. The governor’s concerned about the potential of the additional costs,” Mr. DeCample said.

Those additional costs to the states are expected to be substantial, according to the latest Congressional Budget Office analysis of the Senate Finance Committee bill, said Dennis G. Smith, senior fellow at the Heritage Foundation and the former director of the Medicaid program under President George W. Bush.

“Half of the reduction in the uninsured will result from the enrollment of millions of Americans in Medicaid,” adding 14 million individuals to subsidized federal health coverage programs at a cost of $345 billion over 10 years, Mr. Smith said in a new analysis circulating on Capitol Hill.

Other Democrats refusing to sign the letter were Wyoming Gov. Dave Freudenthal, Oklahoma Gov. Brad Henry, Missouri Gov. Jay Nixon and North Carolina Gov. Bev Perdue.

Republican governors have been weighing into the congressional debate as well, charging that the leading reform plans will have a ?crippling? impact on their states’ already weakened fiscal condition, according to 19 letters the Republican governors sent to congressional leaders in September.

“Some members of Congress have indicated that states should shoulder some of the burden to fund the expansion of Medicaid at a time when our economy and residents are struggling,” said Florida Gov. Charlie Crist, warning that education and public-safety programs may have to be cut to pay for higher health bills.

“This would have a crippling effect on Florida’s state economy and the national economy,” Mr. Crist said.

California Gov. Arnold Schwarzenegger, a Republican whose recession-racked state has plunged deeply into debt, recalled that “the House originally proposed fully funding the expansion with federal dollars, but due to cost concerns, members decided to shift a portion of these expansion costs to states.”

Added Mr. Schwarzenegger, “If Congress thinks the Medicaid expansion is too expensive for the federal government, it is absolutely unaffordable for states.”

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