Senate rejects plan to extend jobless aid, avert looming Medicare cuts

The Associated Press: Every Senate Republican and 12 Democrats rejected a White House-backed proposal to extend jobless programs and state aid created in last year's economic stimulus bill in a 52-45 vote Wednesday. Because the "test vote" on the extension plan failed, "Democrats seeking to reduce the measure's deficit impact are looking at rolling back last year's $25 a week increase in unemployment checks and giving doctors just a short reprieve from scheduled cuts in their Medicare payments" (6/16).

The Wall Street Journal: "In a defeat that saw Democrats abandoned by moderate lawmakers on both sides of the aisle concerned over the cost of the $140 billion measure, Senate leaders will now be forced to go back to the drawing board to devise a way to get a pared down bill through the Senate. … One possibility that is being considered is the 19-month deferral of the payment reductions to doctors is shortened." The bill would also have distributed $24 billion to states to help pay for Medicaid (Boles and Vaughan, 6/16).

CQ also writes that a shorter "doc fix" is likely. Sen. Max Baucus, D-Mont., is expected to unveil the pared back package soon. In carving away the $78.7 billion in new deficit spending in the package, Baucus's plan may target "a $22.9 billion provision that would prevent a cut in payments to doctors who currently see Medicare patients. Baucus could modify that provision to cover Medicare payments through this year only, rather than through 2011, as his original substitute would have done." Meanwhile, Sen. Olympia Snowe, R-Maine, has called for the doc fix to be offset with other spending cuts. Another aspect of the bill likely to be whittled down is the "$24.2 billion provision to provide additional federal assistance for states to help them pay costs associated with Medicaid programs." The House-passed version of the measure did not include this funding, but Senate Democrats had pledged to restore it (6/16).

The Boston Globe: "The vote reflected rising voter anger over deficits and the nation's $13 trillion debt. And it's by no means certain the measure can be revived to win moderate Democrats back and garner the handful of GOP votes needed to eventually pass it" (6/16).