States React to the "Nebraska Compromise"

A number of states are pushing back against the deal that Nebraska Senator Ben Nelson secured for his state that would permanently exempt Nebraska from paying Medicaid costs with the tab being picked up the Federal government. Connecticut's Republican Governor, Jodi Rell, has asked her state's Attorney General, Richard Blumenthal, to file a lawsuit against the Federal government should Nebraska receive additional monies to finance the expansion of Medicare in the final version of the healthcare bill. From the New Haven Register:

Connecticut Gov. M. Jodi Rell has asked the state attorney general to sue the federal government if Nebraska receives extra Medicaid money in the final version of federal health care reform legislation.

In order to secure the support of Nebraska Sen. Ben Nelson for the bill, Senate Democrats included a controversial provision that allows the federal government to pick up 100 percent of the cost of Medicaid expansion in his state.

Rell, a Republican, says the inequity of that provision is "astonishing," and that Connecticut is traditionally reimbursed at a 50 percent rate for Medicaid expenses.

Medicaid is a government health care program, administered by states, for low-income people.

Rell says if Connecticut got the same deal as Nebraska, it could reap up to $262 million annually.

Beyond Connecticut, seven other states are also pushing back on the "Nebraska Compromise" which is frankly more like a "Nebraska Purchase." The Miami Herald reports that top prosecutors in seven states are probing the constitutionality of the political deal.

Attorney General Henry McMaster said he and his counterparts in Alabama, Colorado, Michigan, North Dakota, Texas and Washington state - all Republicans - are jointly taking a look at the deal they've dubbed the "Nebraska compromise."

"The Nebraska compromise, which permanently exempts Nebraska from paying Medicaid costs that Texas and all other 49 states must pay, may violate the United States Constitution - as well as other provisions of federal law," Texas Attorney General Greg Abbott said.

McMaster's move comes at the request of Republican U.S. Sens. Lindsey Graham and Jim DeMint of South Carolina.

Along with Texas, officials in Washington, Alabama, Colorado and Michigan confirmed they were working with McMaster.

North Dakota Attorney General Wayne Stenehjem said he wasn't sure what could be done while the federal legislation remained under debate. Officials in the other states did not immediately respond to a request for comment.

Meanwhile on Tuesday, Tennessee's Republican Senate Speaker Ron Ramsey called for his state's attorney general to investigate the deal.

Ramsey, McMaster and Michigan's Mike Cox are running for governor in their states.

"Whether in the court of law or in the court of public opinion, we must bring an end to this culture of corruption," McMaster said. The negotiations "on their face appear to be a form of vote buying paid for by taxpayers," he said.

McMaster is encouraging a South Carolina citizen to step forward to sue to challenge the measure if it is signed into law. "We'll assist anyone to the extent that we're able," McMaster said.

Frankly, I am not surprised by this and I wouldn't be surprised if more states take similar action. The solution is really to federalize Medicare. Since 1988, the Federal government has increasingly passed on to the states the responsibility to cover the cost-sharing burdens of many low-income Medicare beneficiaries. It's time to unburden the states especially given the incredible budgetary constraints faced by numerous states at this time.

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