Today, President George W. Bush will release the last budget proposal of his presidency. The proposal will be for Federal fiscal year 2009, which begins on Oct. 1, 2008. It is widely expected that the President's proposed budget, as in last year's proposal, will contain deep cuts in Medicare and Medicaid—including significant cuts in Medicare payments to hospitals, with major cuts to teaching and safety net hospitals in particular. Those cuts, if proposed, would come on top of hundreds of millions of dollars in Medicaid cuts proposed by the President last year and contained in regulations issued by the Centers for Medicare & Medicaid Services, including regulations to eliminate Federal Medicaid funding for graduate medical education costs and to drastically cut payments to states for care for the uninsured in public hospitals and nursing homes. Congress has held these regulations at bay temporarily by passing a moratorium on implementing them for one year. The moratorium expires on May 25, 2008. Meanwhile, President Bush called for reining in Medicare and Medicaid spending in his final State of the Union Address on Jan. 28.

Economic Stimulus: Last week, the House passed legislation designed to stimulate the nation's faltering economy, with the Senate expected to follow suit. Despite strong support from GNYHA, the American Hospital Association, the Healthcare Association of New York State, and the nation's governors, the legislation did not include any Medicaid provisions. Lawmakers had considered including a temporary increase in the Federal Medicaid matching rate for states—which would have increased Federal funding for Medicaid at a time when most states are considering deep Medicaid cuts, and extending the moratorium on the Medicaid regulations mentioned above, as well as others. GNYHA will continue to work with the New York delegation—in particular, House Ways and Means Chairman Charles Rangel, House Energy and Commerce member Eliot Engel (who has sponsored legislation to extend the moratorium), Congressman Peter King (who is working on legislation to increase the Medicaid matching rate), and Senate Finance Committee member Charles Schumer—as Congress continues to debate Medicare and Medicaid legislation in the months to come.