The House voted last night to pass a compromise on the debt-ceiling bill.  The bill also passed in the Senate this morning and was signed by President Obama today.

While neither side of the aisle appears to be too happy with the results, Democrats seem to have emerged particularly bruised as the defecit reduction plan appears to be largely based on spending cuts versus new revenues.  However, the debt limit was ultimately extended to 2013 and the nation’s financial ruin seems to have been successfully averted.

The deficit reduction plan will be phased in using two stages:

• Stage 1:  Cut spending by nearly $1 trillion (yes, that’s 12 zeros) and raise the debt ceiling by $900 billion.  Cuts will come mainly from establishing spending caps on current programs ($350 billion of which will come from military spending cuts).
• Stage 2:  A joint committee made up of 12 members (6 from each Chamber with equal numbers of Democrats and Republicans) will have to duke it out to develop legislation that achieves at least another $1.5 trillion deficit reduction by Thanksgiving.  This legislation must be voted on by December 23rd.  If they can’t come to an agreement on legislation then an automatic “sequestration” is triggered, which will pull the additional funds needed by making across the board cuts (Social Security, Medicaid, Veteran’s benefits, and other essential benefits will be exempt from these cuts.

So, that’s it – in a nutshell.  To learn more, check out the short fact sheet put out by the Democratic Policy and Communications Center.

House Democrats released a letter this week directed to leaders of both parties, urging them to raise the debt ceiling instead of forcing millions of low-income children and families to pay up.

Signed by 40 Congressional Democrats, the letter points out that federal spending choices can disproportionately harm the most vulnerable people in our society and urges lawmakers to hold children harmless when proceeding with debt negotiations.   Even small cuts to federal programs, like Medicaid, can have a devastating effect on those who need help.  Rather than catering to the wealthy, the government should be doing what it can to help those in need.

To read the complete letter, click here.

New Yorkers and groups around the state are gearing up for a 2-day, 2-leg caravan next week to meet with congressional delegation members and drive the point home that our social safety net programs – Medicaid, Medicare, and Social Security – need to be protected and preserved.

The tour will begin simultaneously in both upstate and downstate regions on Wednesday, July 20th, with a culminating event on July 21st at the FDR Presidential Library and home in Hyde Park, NY.

For more information, or to RSVP for the event, go to:  www.citizenactionny.org/americanpromise 

OR, see the attached event flyer here. 

An interesting new study is now out by the National Bureau of Economic Research (NBER).  The study took the opportunity presented by a small Medicaid expansion that Oregon underwent in 2008.  At that time, the state decided it was able to add 10,000 more enrollees.  However, nearly 90,000 people actually applied.

The 10,000 that the state was able to cover were randomly selected from the pool, allowing researches to compare the differences between both groups of Medicaid-eligible people:  those that were randomly selected to enroll in the program, and those that were not.

Contrary to what House Republicans may want to hear, the study’s findings did not harp on how much money the federal government was able to save by not covering the other 80,000 people.

Instead, it found that the very presence of Medicaid greatly improved health behaviors and financial stability.  Specifically, researches found that people with Medicaid were:

• 35% more likely to see a doctor or go to a clinic when they felt ill
• 15% more likely to use prescription drugs
• 30% more likely to be admitted to a hospital
• 60% more likely to have mammograms (women)
• 20% more likely to have their cholesterol checked
• 55% more likely to have a regular doctor
• 25% more likely to say that their health was good or excellent
• 40% less likely to say that their health had worsened in the past year
• 25% less likely to have an unpaid bill sent to collections
• 40% less likely to borrow money or fail to pay other bills due to medical bills

Now, that is food for thought.  Particularly in light of the ongoing federal deficit negotiations, where both Medicaid and Medicare remain on the chopping block.  To put it into perspective, cutting Medicaid may save the federal government $100 billion over the next 10 years, but at what cost?

That many more people who need help but are not able get it will only mean that many more people postponing care, skipping preventative care visits, not taking their prescription drugs or seeking treatment when they are ill.  What will the cumulative cost be of the detriment to public health?  And further, what will the cost of the ripple effect be? Unpaid bills, higher debts, lost wages?  It will remain to be seen.

The NBER study, titled “The Oregon Health Insurance Experiment: Evidence from the First Year,” is available on their website (Note: unless you are a subscriber, you may need to pay a $5 fee to download the pdf.  Sorry – I don’t make the rules!) 

Click here to read coverage from the New York Times.

Click here to read coverage from The Oregonian.