WASHINGTON (AP) – A Republican-led effort to slow spending on health care programs for the poor, elderly and disabled survived a stern test in the Senate Tuesday.

That chamber’s Finance Committee, voting along party lines, approved legislation that would trim overall spending on Medicare and Medicaid by about $10 billion over five years. The committee’s 11 Republicans supported the legislation. The committee’s nine Democrats opposed it.

In doing so, Democrats cited what they believed was inadequate assistance for victims of Hurricane Katrina. In particular, Democrats wanted to temporarily extend Medicaid coverage to thousands of people currently ineligible for the program even though they have lost their jobs and their home.

“Eight weeks ago yesterday, Katrina made landfall. Eight weeks ago today, the levees broke. And eight weeks later, I cannot in good conscience join in cutting health care, when Congress has left the health care needs of Katrina’s victims unaddressed,” said Sen. Max Baucus of Montana, the top Democrat on the Finance Committee.

Republicans said they weren’t thrilled with the bill, either, mainly because they said it did not go far enough to overhaul Medicaid, the nation’s health insurance program for the poor. But they rejected the notion that beneficiaries would get a reduced level of care as a result of the changes they approved.

“We are not cutting health care services to the beneficiaries,” said Sen. Rick Santorum, R-Pa. “We have squeezed some fraud out. We have squeezed providers.”

The legislation reflected the difficult balancing act facing the committee’s chairman, Sen. Charles Grassley, R-Iowa.

Grassley had to maintain support from all 11 committee Republican to ensure the measure’s passage. But some wanted more significant reductions in Medicaid than others were willing to accept.

In the end, the legislation the panel approved Tuesday would reduce Medicare spending by about $5.8 billion over five years and Medicaid by about $4.3 billion during that time.

Even with those reductions, however, the Congressional Budget Office projects that financing of the two programs would grow substantially over the coming five years.

The CBO predicts Medicaid spending will increase from about $192 billion in 2006 to about $260 billion in 2010. Medicare spending will increase from about $385 billion in the coming year to about $525 billion in 2010. The increases reflect growing health care costs and a growing number of people becoming eligible for the programs.

This week, several committees in both chambers are considering legislation that would reduce spending on programs over which they have jurisdiction. Their contribution will be made part of an overall bill that would reflect a congressional budget blueprint passed in April.

The blueprint called for $35 billion in spending cuts and $70 billion in tax cuts, a point that Sen. Kent Conrad, D-N.D., emphasized when he said that legislation billed as reducing the deficit would actually increase it.

“It’s almost as if words have lost their meaning,” said Conrad, another Finance Committee member.

But Sen. Mike Crapo, R-Idaho, said he viewed the legislation as not cutting taxes, but as preventing tax increases that would occur if Congress does not act.

Lawmakers filed 131 amendments to the legislation, but all of the amendments that came up for a vote Tuesday were defeated.

The House Energy and Commerce Committee is expected to take up legislation Thursday that would reduce Medicaid spending by about $11 billion over five years.

Meanwhile, Rep. John Boehner, R-Ohio, proposed a change in the broader budget bill that would curb spending for student loans by about $14-15 billion over five years, mostly by cutting subsidies to lenders, but also by changing the interest rate structure for students.

“We’re squeezing the lenders pretty good,” said Boehner, chairman of the House Education and Workforce Committee.

The Boehner plan also would raise about $6 billion through overhauling the federal pension insurance system. The bill would immediately increase per-employee pension premiums paid to the Pension Benefit Guaranty Corp. from $19 to $30. It also would charge a total of $3,750 in exit fees for companies emerging from bankruptcy that shed their pension responsibilities while in bankruptcy.

Separately, House Agriculture Committee Chairman Robert Goodlatte, R-Va., has drafted a plan to cut the food stamp program by $1.1 billion over five years. It would tighten eligibility requirements, leading to a drop of perhaps 300,000 working families from food stamp rolls. It also would make legal immigrants wait 10 years instead of five to be eligible for the program and limit benefits for able-bodied beneficiaries without children.

The plan also would cut $3.1 billion from farm programs and would not extend a hotly contested program that provides income payments to dairy farmers.



Associated Press writer Andrew Taylor contributed to this report.

On the Net:

Senate Finance Committee: http://finance.senate.gov

Congressional Budget Office: http://www.cbo.gov

AP-ES-10-25-05 1945EDT


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