Efforts To Solve Debt Crisis May Affect Medicaid Funding

The New York Times: No Matter How Debt Debate Ends, Governors See More Cuts For States
If the federal debt limit is not raised, several governors said as they gathered here on Friday for the semiannual meeting of the National Governors Association, the ensuing default will harm the economy, make it difficult for states to borrow money and delay some of the vital federal payments that states count on for everything from Medicaid to unemployment benefits. ... Governors in both parties said they were most worried by talk that both President Obama and Congressional Republicans wanted to cut Medicaid payments to the states by $100 billion over the next decade (Cooper, 7/15).

The Los Angeles Times: House Republicans Brace For Compromise On Debt
At a closed-door meeting Friday morning, GOP leaders turned to their most trusted budget expert, Rep. Paul D. Ryan of Wisconsin, to explain to rank-and-file members what many others have come to understand: A fiscal meltdown could occur if Congress fails to raise the debt ceiling. ... At the same time, Republican leaders orchestrated a series of public moves intended to soften the blow for conservatives. They agreed to give the House an opportunity to vote on two top conservative priorities: a so-called cut-cap-and-balance bill, which would order $111 billion in cuts in federal programs for 2012 and impose a cap on future spending, and a constitutional amendment that would require a balanced federal budget (Mascaro and Hennessey, 7/16).

Politico Pro: 'Cut, Cap And Balance' Leaves Medicaid Vulnerable
The "Cut, Cap and Balance" bill that Republican leaders in the House announced Friday shields Medicare from cuts, but leaves Medicaid heavily exposed. The bill, which the House is likely to vote on next week, would place a cap on federal spending at 19.9 percent of the gross domestic product, but Medicare would be exempt from the cap, along with Social Security, veterans benefits and interest on the debt. It also exempts these programs from cuts that would be triggered if spending exceeded the cap. ... But Medicaid and all other low-income entitlement programs such as food stamps are not exempted, which means they would likely face steep cuts in order to reach spending targets (Feder, 7/15). 

The New York Times: Fallback Plan Moving To Fore As Budget Talks Stall
The House proposal would prohibit raising the debt limit unless Congress sends to the states a proposed balanced-budget constitutional amendment. It would also cut federal spending more than $100 billion in 2012. ... But Mr. Obama said the proposed spending cap "would require cutting Social Security or Medicare substantially." As for a balanced-budget amendment, he said, "We don't need a constitutional amendment to do our jobs" (Calmes and Hulse, 7/15). 

The Wall Street Journal: Hospital Ads Raise the Ire Of Democrats
An angry confrontation behind closed doors this week shows that the acrimonious debt talks in Washington are causing cracks in a normally rock-solid alliance: Democrats and health-care workers. Senior New York Democrats confronted leaders of the Greater New York Hospital Association and the health-care workers union, 1199 SEIU, at a meeting Wednesday, according to several people who were there. The lawmakers were upset that the two groups had taken out full-page newspaper ads that day suggesting Democrats might "kill health reform'' in ongoing budget talks (Barrett, 7/16).

Chicago Tribune: Group Delivers Protest Signatures To Obama's Chicago Campaign Headquarters
A group of liberal voters who said they volunteered and donated to President Barack Obama's 2008 campaign are threatening to pull their support if he signs off on cuts to Medicaid, Medicare and Social Security during ongoing debt negotiations with Republicans (Garcia, 7/15).

Chicago Sun Times: Liberal Activists Give Obama Warning About Cost Of GOP Cooperation
Pressuring President Obama from his left, activists showed up at his campaign headquarters in Chicago Friday with 200,000 signed pledges from volunteers and donors from his last campaign saying they will not volunteer or donate to his re-election campaign if he agrees to Republican demands for cuts to Medicare, Medicaid or social security (Pallasch and Sweet, 7/16).

NPR: Does President Obama Really Want To Means-Test Medicare? Probably Not
President Obama (and many, many others) have been throwing around the phrase "means testing" as they talk about ways to cut spending for Medicare. If Medicare actually was means-tested, then wealthier people wouldn't get the benefit at all. The context of the President's comments make it fairly clear that he's talking about something else entirely. It's called "income relating." That's when people with higher incomes pay more but get the same benefits as people who earn less (Rovner, 7/15).