Nebraska Governor, Senate Democrats Pressure Nelson To Abandon Medicaid Carve-Out Deal

On December 22, Sen. Ben Nelson (D-NE) defended the Nebraska Medicaid deal by arguing that he was protecting the state from unfunded mandates at the Governor’s request. Nelson quoted Nebraska Governor Dave Heineman’s concerns about rising costs and stressed that he was “prepared to ask that this provision be removed from the amendment in conference if it’s the governor’s desire.”

Since the deal became public, however, Heineman has repeatedly said that he “didn’t want a special deal” out of Senate health care bill. “We’re embarrassed by what’s going on. We’re very surprised. Nebraskans are angry and upset about what occurred. And so they need to set this straight,” Heineman told Fox News’ Greta Van Sustren the day Nelson explained his reasoning. This morning he reiterated his opposition:

What I’m saying is, every Governor including myself is worried about unfunded mandates, education, Medicaid or whatever and we don’t want that and we don’t want this special deal and don’t wanted to be treated differently than any other state. We — all states ought to be treated fairly and equally, particularly when you are talking about a federal program like Medicaid.

Watch it:

Heineman’s public condemnations, the pending constitutional challenge from 13 attorneys general, and the growing Democratic discomfort with the agreement, may ultimately force negotiators to remove the provision from the final legislation. Sen. Blanche Lincoln (D-AR) has said that the deal should not be part of the final package and yesterday, Sen. Sherrod Brown (D-OH) predicted that it “won’t be law by the time that goes into effect.”

But so far, Nelson isn’t backing down. The Senator recently ran a television ad defending the agreement and even asked South Carolina Attorney General Henry McMaster — the leader of the so-called Gang of 13 AGs — to “call off the dogs” on the constitutional challenge.

Whatever the merits of Nelson’s carve-out, Congress has long considered each state’s unique economic conditions and circumstances in crafting legislation. In fact, even today, the federal matching formula varies from state to state, depending on each state’s poverty level. States are not always treated “fairly and equally,” nor should they be.