Budget Update: House Passes Budget Resolution Including $2.2 Billion in Medicaid Cuts, Budget Plan Now Be Reconciled With the Senate
By a narrow 215-212 margin, the House on March 25 cleared its version of the FY 2005 budget resolution that includes $2.2 billion in reductions to future Medicaid spending over the next five years. These reductions come in the form of instructions to the Energy & Commerce Committee to trim "waste, fraud and abuse" in the Medicaid and SCHIP programs. This House budget resolution must now be reconciled with a separate Senate version that does not include proposed reduction to Medicaid. The Senate voted three weeks ago to reject $11 billion in Medicaid cuts over the next five years.
While the proposed cut to Medicaid in the House budget resolution is much smaller than the cuts that were rejected by the Senate; $2.2 billion is still a substantial reduction. NAMI remains concerned that such a cut would fall hardest on optional populations and services.
NAMI advocates are urged to contact their Senators and urge them to oppose the Medicaid reductions in the House budget resolution. In particular, Senators should be encouraged to contact Senate Budget Chairman Don Nickles (R-OK) and Ranking Member Kent Conrad (D-ND) to ask them to reject proposed cuts to Medicaid as part of any final budget resolution. Remind your Senators that:
- Medicaid is the critical safety net program for children and adults with severe mental illness, offering coverage of medications and community-based services and supports,
- Many states are already moving to reduce Medicaid coverage and benefits by limiting access to the full range of mental illness treatments and limiting eligibility for services, and
- Further cuts in the federal share of Medicaid would be devastating to states and their public mental health systems that depend on Medicaid to meet the treatment and support needs of the vulnerable.
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While the budget resolution does not have the force of law, its provisions do provide binding guidance to House and Senate Committees to produce specified reductions and policy changes to entitlement programs such as Medicaid. These cuts take the form of binding instructions to the Senate Finance and House Energy and Commerce Committees to reduce federal matching funds to Medicaid program without specifying where to make the reductions. Under congressional budget rules these assumptions carry enormous weight and result in a procedural requirement for cuts later in the year. It is therefore critically important to maintain pressure on the House to reject cuts to Medicaid just as the Senate did last week on a bipartisan basis.