January 7, 2010, 4:13 pm

Nelson to Fight for All States

Senator Ben Nelson, Democrat of Nebraska, has been under fire in recent days for winning some plum provisions for his home state in exchange for voting for his partyfs big health care legislation. But in a statement on Thursday, Mr. Nelson said he would fight for all states to get the same benefits as Nebraska — a move that some Senate colleagues had predicted as inevitable.

Luke Sharrett/The New York Times Senator Ben Nelson of Nebraska.

When Mr. Nelson was negotiating with the Senate majority leader, Harry Reid of Nevada, over whether he would support the health care bill, he demanded that the federal government pick up the total cost of a proposed Medicaid expansion in Nebraska, even though other states would eventually have to share the cost of expanding their Medicaid programs.

Mr. Reid agreed and inserted a provision for the federal government to pay Nebraskafs new Medicaid costs indefinitely. But that provision has had its own political cost, with Republicans accusing Democrats of bribing Mr. Nelson with a gsweetheart dealh to win his vote.

In perhaps the most pointed criticism yet, Gov. Arnold Schwarzenegger of California, in his State of the State address on Wednesday, said: gCaliforniafs Congressional delegation should either vote against this bill that is a disaster for California or get in there and fight for the same sweetheart deal Senator Nelson of Nebraska got for the Cornhusker State. He got the corn; we got the husk.h

Now Mr. Nelson says he will fight for California and other states to get the corn, too. And that could cost the federal government a whole bunch of beans.

gAs a former governor, Ifve long fought against unfunded federal mandates, which force Washington rules on states with little or no money to pay for them,h Mr. Nelson said. gThe current health care bill has an unfunded mandate for expanding Medicaid. While helping more Americans obtain health coverage is important, this mandate could burden state budgets in uncertain economic times ahead.h

He added: gIfve been in serious discussions with Senate leaders and others to secure changes in the bill to treat all states equally. At the end of the day, whatever Nebraska gets will apply to all states.h

Of course, the Medicaid provisions now in the Senate bill are not an unfunded mandate for Nebraska. And federal officials have long contended that Medicaid is not in fact a classic unfunded mandate. Medicaid, the federal-state insurance program for low-income Americans, has always been a partnership – with the federal government and states sharing the costs.

In his statement, Mr. Nelson said he was considering a number of options during negotiations, including pushing to have the federal government pick up the full Medicaid expansion costs for all states. That could substantially increase the cost of the legislation.

Another idea Mr. Nelson is proposing is to allow states to opt out of the Medicaid expansion. But that is unlikely to win the support of Congressional leaders, given that Medicaid expansion is one of the billfs major strategies to expand coverage to the uninsured. Under both the House and Senate measures, some 15 million people would gain coverage through Medicaid by 2019, according to the Congressional Budget Office.

gMy view is, either fund it or unmandate it,h Mr. Nelson said.

A Senate Democratic aide said that Mr. Nelsonfs proposal for the federal government to pick up the full cost of Medicaid expansion would add $25 billion to $30 billion to the $871 billion, 10-year price of the legislation.

As it stands now, the cost of the bill would be more than offset by revenues from new taxes and fees, and reduced government spending, particularly on Medicare, so that the legislation would reduce future federal deficits by $132 billion over a decade.

But the bulk of that deficit reduction would come from money tagged to pay future benefits under a new long-term care insurance program, or to shore up the Social Security and Medicare trusts. Without some other offset, Mr. Nelsonfs proposal would add the deficit, the Senate aide said, undermining President Obamafs core pledge that the bill not add one dime to the nationfs deficits.

Governors have expressed concern about the potential cost of the Medicaid expansion. Under the Senate bill, the federal government would pick up the full cost of new enrollees in Medicaid for three years, starting in 2014. But states would begin to share the cost after that.

Even people in Nebraska have accused Mr. Nelson of receiving unfair treatment. But the senator denied that was ever his goal. gMy intent has been and remains absolutely clear,h Mr. Nelson said. gEvery state should be, and will be, treated the same.h

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