Health Reform Passes Senate, But Will House Dems Sign On?

Both bills would transform and vastly expand the mission of the Medicaid program, which is jointly administered (and paid for) by the state and federal governments. Currently, under a patchwork of state regulations, it is generally available to low-income people only if they are also elderly, disabled or pregnant. The two bills would make Medicaid a system in which people could qualify on the basis of low income alone. Many health-care experts have said this is the most efficient and cost-effective way of expanding coverage to those of limited means. (More than one in three of the uninsured have incomes below the poverty line.)

However, there are differences in how the two bills would expand Medicaid. Put simply, the House would put more people into the program. Under the House bill, those earning up to 150% (or $33,000 for a family of four) of poverty would qualify; the Senate bill would set the upper limit at 133% of poverty (or $29,300 a year for a family of four). House bill is also more generous in helping states pay for their share of the newly eligible Medicaid recipients. (Read "Medicaid and the States: Health-Care Reform's Next Hurdle.")

State governments will be watching these negotiations carefully. Governors, already strapped for funds, have complained that they cannot afford the additional burden. That is one reason Nebraska's Ben Nelson, who provided the final and crucial vote in the Senate, negotiated a special deal for his state, in which Washington would pay the whole tab for the expansion. There are likely to be other lawmakers clamoring for similar arrangements.

Additionally, some governors have warned that their states do not have enough providers willing to accept patients under Medicaid, which in many states pays very low reimbursement.