U.S. Senate Inaction on Federal Medicaid Funding Imperils Pa. Budget

June 25, 2010

The latest news on state budget negotiations put both sides within $400 million of a final 2010-11 budget this week. House Democratic leaders proposed a $28.2 billion budget, a modest increase in spending from this year, in response to a $27.8 billion proposal put forth by Senate Republican leaders.

Then there was the devastating news out of Washington Thursday night: The U.S. Senate stalled on legislation to extend federal FMAP funding. That means $850 million in public health care funding won't be coming to Pennsylvania after all.

This puts state budget negotiators $1.2 billion apart. If lawmakers solve this crisis with deep cuts, it will cost 25,000 jobs in the public and private sector, threatening the fragile economic recovery in Pennsylvania.

As the Center on Budget and Policy Priorities observed in a report released before the Senate vote yesterday, the Senate's inability to pass this bill raises the risk of a double-dip recession as the loss of state spending power ripples through the economy. (This report also includes a chart showing what each state would receive in FMAP funding under the stalled legislation.)

You can help by calling your state lawmakers and urging them to take a balanced approach to the budget crisis - one that includes raising new revenue rather than all cuts. Find your lawmakers' contact information here.

Follow up your call by sending an email to your lawmakers urging them to take a balanced approach.