Press Releases :: August 10, 2010

House Passes Measure, President Will Sign into Law

Congresswoman Tammy Baldwin’s efforts to preserve health care services for low income individuals and families and prevent massive budget cuts in Wisconsin were successful today when the House passed (247-161) H.R. 1586, the Education Jobs and Medicaid Assistance Act. Baldwin led efforts in the House to extend Medicaid assistance to states provided in this legislation.

“During this economic crisis, states are facing severe budget shortfalls, and without federal help, would have to take extreme action,” Baldwin explained. “Who would this hurt? It would hurt our most vulnerable – our children, our elders, our sick, and our frail. States would be forced to make cuts where we can least afford them. These cuts would be catastrophic and I’m proud to have helped prevent them,” Baldwin said.

The American Recovery and Reinvestment Act (ARRA) temporarily increased the Medicaid Federal Matching Assistance Percentage (FMAP) to help states recover from the economic recession. This provision is set to expire at the end of 2010. Although our economy is recovering, progress is slow and states remain in crisis.

Earlier this year, Congresswoman Baldwin introduced stand-alone legislation, the State Medicaid Assistance Extension Act of 2009 (H.R. 4263), to extend Medicaid assistance for states for an additional year, through the end of 2011. At the same time, she advocated fiercely for the extension to be included in jobs legislation moving through the House. And, she led a letter signed by 219 of her colleagues urging House leadership to include this Medicaid assistance in other legislation.

The Wisconsin Medicaid program has experienced a dramatic increase in caseload over the last two years, from 906,255 cases in May 2008 to 1,137,885 in May 2010, a 26% increase. The situation is dire. Not extending FMAP another six months would mean the loss of more than $200 million in federal assistance, and would necessitate cutting nearly $1 billion from the Wisconsin state budget.

According to the Congressional Budget Office (CBO), temporary FMAP assistance is one of the most effective measures to create jobs and spur demand in the economy. For this reason, Congress provided FMAP funds to states to address recent recessions in 2003 and 2009, under both Democratic and Republican majorities.
The legislation passed today also provides desperately needed funds to keep teachers in the classroom and police officers on the beat instead of in the unemployment line.

The legislation provides $10 billion in funding to save more than 160,000 teacher jobs nationwide. In Wisconsin, it will prevent the layoff of roughly 3,000 teachers.

It also provides $16.1 billion in health assistance to the states that, by reducing shortfalls and stimulating the economy, will save and create 158,000 jobs, including preventing the layoffs of police officers and firefighters, as well as creating private-sector jobs throughout our economy.

The bill is completely paid for, in part by closing tax loopholes that encourage corporations to ship American jobs overseas.

And, it cuts the deficit by $1.4 billion over 10 years.

The bill now goes to the President for his signature.

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*Estimated WI Medicaid Savings Jan. 2011-June 2011: $229,000,000
Source: Center on Budget and Policy Priorities (CBPP)

Note that CBPP’s estimates may differ somewhat from estimates conducted by the Congressional Budget Office (which estimates a total of $16 billion under the extension rather than $15 billion) as well as state-specific estimates generated by state officials because of differences in the methodology, or in the underlying data related to Medicaid spending and projected state unemployment rates.

*Est. Teachers’ Jobs Saved from U.S. Dept. of Education

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