Senators vent frustration over Katrina aid bill

By David Lawder Thu Oct 6, 8:45 PM ET

WASHINGTON (Reuters) - Leaders of a Senate committee including its Republican head bluntly accused the Bush administration on Thursday of sabotaging a bill to provide Medicaid health assistance for victims of Hurricane Katrina.

"Unfortunately, the White House is working against me behind the scenes, and I resent that, considering how I've delivered so much for the White House over the last five years," Finance Committee Chairman Sen. Charles Grassley (news, bio, voting record) said at a hearing on recovery efforts from the U.S. Gulf Coast hurricanes.

Grassley, of Iowa, has been a key ally of President George W. Bush's proposal to overhaul the Social Security retirement system at a time when other Republicans have been wary.

He and the committee's top Democrat, Montana Sen. Max Baucus (news, bio, voting record), are pushing a bill that would ease Medicaid eligibility requirements for storm victims for five months and provide states with reimbursement for 100 percent of costs for such patients.

Costs for Medicaid, the health care program for the poor, are normally split between Washington and the states.

The legislation would have cost the federal government as much as $9 billion, but Senate aides said the cost was cut to around $6 billion in negotiations with the White House and Republican leaders.

The administration says the Grassley-Baucus bill is still too expensive, too broad and may open the door for the government to pay costs for people who were not storm victims.

Asked about Grassley's criticism, White House spokesman Trent Duffy said, "The White House is working with the Congress to find the best way to get health care help to those affected by the storms."

Grassley and Baucus implored Treasury Secretary John Snow to "forcefully" seek support for the bill from within the administration, including from Health and Human Services Secretary Michael Leavitt, who oversees the federal side of Medicaid.

"If you're going to see Secretary Leavitt, tell him to get the White House to back off of our bill," Grassley said. "There's people hurting down there and we need to get some help for them."

Baucus said further delays in the bill would prolong human suffering from the August 29 storm.

"It's been six weeks now. Where is the administration? It is slow-walking, it is opposing, it is obfuscating, it is delaying, it is not acting," he said.

Snow said he did not know enough about the issue to speak for the administration, but said he would discuss it with Leavitt.

Grassley and Baucus say the bill offers the same benefits offered in New York after the September 11, 2001, attacks. But Health and Human Services Department spokeswoman Christina Pearson said the eligibility changes were put in place before the attacks and New York state continued to pay its share of Medicaid costs.

The department favors allowing states to obtain Medicaid waivers to provide coverage for a broader number of patients because it can be done immediately with no legislation.

Texas, Mississippi, Alabama and Arkansas have already obtained waivers, which would provide up to five months of coverage. But states struggling with reduced revenues would still pay a big share of the extra costs, which they would not pay under the Grassley-Baucus bill.

In Louisiana, Medicaid officials have turned away more than 6,000 people, or 55 percent of hurricane evacuees housed in shelters who sought aid, the New Orleans Times-Picayune reported this week.