POLITICS
06/22/2010 04:25 pm ET | Updated May 25, 2011

Twenty One Days Since Congress Allowed Extended Unemployment Benefits To Lapse

Congress has had a hard time lately finding the will to help the poor, the old and the jobless.

It's been a full three weeks since lawmakers failed to reauthorize extended unemployment benefits, to prevent a 21 percent pay cut to doctors who see Medicare patients and to provide states with $24 billion in Medicaid assistance. The House passed a bill at the end of May, but the Senate adjourned for its Memorial Day recess without acting. Since then, Senate Democrats have been unable to muster the 60 vote supermajority needed to get the legislation done.

Meanwhile, 903,000 people jobless through no fault of their own have missed unemployment checks and doctors are getting shorted for taking care of old folks.

Senate Majority Leader Harry Reid (D-Nev.) and Sen. Max Baucus (D-Mont.) have winnowed the "tax extenders" bill, as it is known, to meet the demands of Senate Democrats variously worried about adding to the deficit and closing a loophole that allows rich investment fund managers to pay a lower tax rate than their secretaries. They've softened the tax provision and reduced the bill's original $134 billion 10-year deficit impact to just under $55 billion, a feat accomplished by doing things like cutting $25 per week from every unemployment check and shortening the duration of "Doc Fix," the provision that takes care of Medicare physicians.

It's not enough: To win the necessary Republican votes, Democrats will need to add revenue raisers to offset the deficit impact further still.

"We've tried for weeks to pass the bill that's on the floor now," said Reid at a Tuesday press conference. "I'm hopeful and confident that we're going to have a vote on this legislation. We're going to make some changes."

Reid will probably need two Republicans to support the bill. In a key vote last week, Democrats came up short as Sen. Ben Nelson (D-Neb.) and Sen. Joe Lieberman (I-Conn.) sided with the GOP. Nelson has remained steadfast that the entire bill be paid for; Lieberman has since said that if Reid rounds up 59 votes, he doesn't want to be the spoiler.

Sen. Olympia Snowe (R-Maine) told reporters she's been talking with Reid and Baucus about using unspent stimulus funds (which Democrats have argued are already dedicated to other projects) to offset a portion of the $24 billion in enhanced Federal Medicaid Assistance Percentages (FMAP), which various state governors have said are urgently needed to prevent massive public sector layoffs. The nonpartisan Center on Budget and Policy Priorities estimates that without the FMAP money, states will be forced to fire 900,000 workers. Sen. Susan Collins (R-Maine) said she was discussing ways to phase out the FMAP funding so that states don't face a sudden drop-off.

Snowe said she would not insist that the unemployment benefits -- which will cost more than $30 billion -- be paid for. "I think the economy has not demonstrated the capacity to create jobs," she said, "so I think it's our burden to turn that around, not to foist that on those who are unemployed and dependent on unemployment benefits."

Some Republicans and Democrats in both the House and Senate have said they believe it is, in fact, time to foist that burden onto the unemployed, who they suspect aren't finding jobs because they'd rather collect benefits than look for work. That, in part, is why there is no help at all forthcoming for the 99ers, the hundreds of thousands of people who have exhausted all available benefits.

Both chambers of Congress have already approved extending unemployment through the rest of the year, but with different sources of funding. When it came time to combine the bills, conservative Democrats decided they were more concerned about the deficit than anything else.

When Senate Democrats finally approve the bill, it will face another vote in the House, where Dem leadership cut out the Medicaid money in the first place to appease deficit hawks at the end of May. Senate Dems may also try to reinsert just under $8 billion to help laid-off workers buy health insurance, another provision sacrificed to deficit reduction.

Hoping the Senate would act quickly, the Centers for Medicare & Medicaid Services (CMS) held off on the paycut to doctors for weeks, but is now processing 50 million June claims at the reduced rate, according to Politico. When Congress finally passes these measures, physicians and the unemployed will be paid retroactively -- but the 21-day delay has its own costs. CMS estimates that every reprocessed claim will cost the agency 30 cents, or $15 million for the those 50 million claims.

The National Association of State Workforce Agencies says the administrative burden on state labor departments is "huge." This is the third time Congress has allowed benefits to lapse this year, but this time the obstacles to getting the bill done are more severe now than before -- and benefits recipients know it.

"Customers are more desperate, more angry, and are less optimistic about the likelihood of Congress passing continued extensions," wrote a staffer in the Idaho Labor Department in an email to NASWA. "As one would expect, the customers who would have exhausted their latest tier and would have access to an additional tier except for this lapse are the most upset. Our staff members are doing their best to explain the circumstances to customers, but it is difficult when customers are emotional and staff has no control over what will happen and no real answers to provide."