Democrats in the U.S. Senate, with the help of two Republicans, broke through a Republican filibuster Tuesday night on a bill to extend unemployment benefits. But the part of the legislation which would have included the Federal Medicaid Assistance Percentages (FMAP) extension was left on the cutting room floor.
For 370,000 Pennsylvanians out of work for six months or more, it means an extension of unemployment benefits, but without the inclusion of FMAP, which accounts for $850 million in revenue in this year's budget, a budget crisis is looming. Failure of Congress to pass the extension before heading for their August recess in two weeks would require Gov. Ed Rendell and legislative leaders to agree to cut into a budget which is less than a month old.
Asked Wednesday on the status of FMAP after Tuesday's vote by the U.S. Senate, Mr. Rendell said he was slightly more optimistic about its passage.
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"I'm going to call [U.S. Sen. Harry] Reid (D-Nev.) today and get a read from him about what the chances are and what the timing is," said Mr. Rendell.
Pennsylvania is one of 19 states, plus the District of Columbia, depending on the federal taxpayer funds for Medicaid to keep their budgets balanced.
Other states passed budgets without the inclusion of the FMAP funds, and will treat them as a bonus if they arrive from Washington.
One of those states is Minnesota, which stands to receive $408 million in FMAP funds. Despite facing a deficit of more than $900 million at the end of last fiscal year, the state did not include FMAP in this year's budget.
"It was included in the governor's budget proposal in February and then when the negotiations happened at the end of the session in May, it didn't appear that the money was going to be coming. So it was not included in the budget deal," said Curt Yoakim, a spokesperson for the Minnesota Management and Budget Office.
Should the money come through, the Minnesota legislature has pre-approved the executive branch to immediately use it to replace state funds appropriated for Medicare, which in turn would be placed in reserve and added to the state's bottom line.
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Audio: Gov. Rendell still optimistic about FMAP bill Pennsylvania took a different approach, including the revenue from FMAP in the budget and planning to make adjustments if the funds are not delivered.
Earlier in the week, Mr. Rendell said the passage of the unemployment benefits bill would be a good sign for the FMAP extension. Both senators from Pennsylvania voted in favor of ending debate on the unemployment bill Tuesday, paving the way for a vote on final passage by the end of the week, but without FMAP included.
"If we don't have a strong indication one way or the other by the end of July, the governor has said we're going to have to start looking at options," said Gary Tuma, the governor's press secretary. "We've already developed a couple of different scenarios, a menu of options for legislative leaders."
Making up the $850 million would primarily come from program cuts, not new taxes, Mr. Rendell said Wednesday.
Monday, Mr. Rendell said a round of 700 cuts were planned even if the state were to receive FMAP money, with a more dramatic list of cuts required without it.
Eric Boehm is a reporter for PA Independent. He can be reached at Eric@PAIndependent.com
