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Nelson Continues to Rebut Critics of Medicaid Deal

Sen. Ben Nelson (D-Neb.) continues to rebut critics of a deal he cut with Democratic leaders in the waning days of the Senate health care debate, this time lashing out at California Gov. Arnold Schwarzenegger (R) for disparaging comments he made in his State of the State address.

Last week, Schwarzenegger urged California’s Congressional delegation to vote against health care reform, saying Sacramento cannot afford the financial burden of the legislation’s proposed Medicaid expansion. In making his case, Schwarzenegger ridiculed an agreement Nelson secured to have Nebraska’s portion of the Medicaid expansion paid for in perpetuity.

“California’s 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 that Sen. Nelson of Nebraska got for the Cornhusker State. Because that Senator got for the Cornhusker State the corn and we got the husk,— Schwarzenegger told a joint session of the Legislature.

On Sunday, Nelson responded, arguing that the Senate bill’s proposed Medicaid expansion is not the cause of California’s budget problems, which are severe. Nelson has been on the defensive for the deal that has become commonly derided as the “Cornhusker Kickback.—

“I’ve fought against unfunded federal mandates throughout two terms as governor and as senator. I accepted the Nebraska provision not for my vote but to fix the unfunded Medicaid mandate for all states in the final health reform bill,— Nelson said in a prepared statement released by his office. “I am aggressively seeking an opt-out or full funding for all states. I agree with Gov. Schwarzenegger that all states should be relieved of this unfunded mandate. But relief from an unfunded mandate that kicks in 7 years from now isn’t going to solve the $20 billion deficit California has today.—

The federal government and the states jointly fund Medicaid, which provides health care to the poor. The House and Senate health care bills propose to expand Medicaid to insure more Americans.

However, governors, many of whom face budget crunches of their own, have complained. Nelson inserted a provision into the Senate bill to mitigate concerns from Nebraska Gov. Dave Heineman (R) about how expanding Medicaid would affect the state’s budget.

Nelson has since said the deal was meant as a placeholder to allow him to fight for such an exemption for all states in the final health care package.

Given that such an exemption could add $28.8 billion to the cost of the Senate health care bill, the feasibility of Nelson’s proposal appears uncertain. The Senate package, at $871 billion over 10 years, is close to the $900 billion limit President Barack Obama set for the legislation during an address to a joint session of Congress last September. Meanwhile, the cost of the House package is estimated at $1.2 trillion.

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