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Republicans spar over Katrina aid costs

Mary Curtius Los Angeles Times

WASHINGTON – Senate Finance Committee members accused the White House on Wednesday of blocking a bipartisan, $9 billion healthcare package for Hurricane Katrina victims.

The public display of the deepening dispute among Republicans over the federal government’s role in the recovery effort came at a hearing where the governors of Alabama, Mississippi and Louisiana, the three states hardest hit by Katrina, pleaded for more federal help.

Louisiana Gov. Kathleen Babineaux Blanco told the panel that 41 percent of her state’s businesses had been destroyed or forced to close. “To bring our folks home, we need jobs, housing and rebuilt communities,” she said.

Committee members promised to consider additional tax breaks and other measures to spur reconstruction, but they spent much of their time fuming about the administration’s opposition to the healthcare package introduced last week by Sens. Charles E. Grassley, R-Iowa, and Max Baucus, D-Mont., the panel’s chairman and vice chairman.

The debate over the legislation is a piece of the larger fight on Capitol Hill over the price of reconstruction and ways the federal government could offset some of the costs. The dispute has fractured Republicans, with House conservatives insisting on deep budget cuts to help pay for what is expected to be at least a $100 billion rebuilding effort.

Grassley’s legislation represents a clear threat to conservatives’ efforts to rein in costs and limit the federal government’s role.

The legislation would temporarily extend Medicaid coverage to thousands of adult victims of the hurricane who would otherwise have no health insurance. Under the bill, the uninsured would get five months of coverage, and President Bush would have the option of extending the program an additional five months. It would also require the federal government to pick up the entire tab for Medicaid costs in Louisiana, Alabama and Mississippi for 2006.

Grassley and Baucus expected the bill to pass by a voice vote Monday, but it was blocked by two conservative senators, John E. Sununu, R-N.H., and John Ensign, R-Nev. In a speech on the Senate floor, Sununu said the time had come for senators to exercise greater caution in the relief effort.

Baucus warned Blanco Wednesday that such opposition to the healthcare package was fueled by growing concerns in the Senate about how the $62 billion already appropriated for hurricane relief has been spent.

Mike Leavitt, secretary of Health and Human Services, outlined the administration’s opposition to Grassley’s healthcare proposal in a letter sent to Senate leaders Tuesday, calling it unnecessary and “inadvisable.”

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