McDaniel: Senate deal would give 'special status' to Nebraska

By Chris Rizo | Jan 11, 2010

Dustin McDaniel (D)

LITTLE ROCK, Ark. (Legal Newsline) - Arkansas Attorney General Dustin McDaniel said Monday he wants a controversial Medicaid deal stripped from federal health care legislation but stopped short of threatening to sue if the provision is included in a final bill.

McDaniel is the latest Democratic attorney general to come out against so-called Nebraska Compromise, which would allow Nebraska to avoid increased Medicaid costs that other states would be required to cover.

The provision in the Senate-approved health care plan that exempts Nebraska from having to pay Medicaid expense increases was inserted into the bill to gain the support of Sen. Ben Nelson, D-Neb., who offered the 60th and final vote late last month needed to pass the plan aimed at expanding access to health care.

More than a dozen Republican attorneys general have threatened legal action if the provision is included in legislation sent to the president for his signature, while a handful of Democratic AGs have quietly asked their respective state's congressional delegation to oppose inclusion of the deal.

McDaniel, in a letter to Senate Majority Leader Harry Reid, D-Nev., and House Speaker Nancy Pelosi, D-Calif., said the provision would unfairly benefit Nebraska at the expense of other states.

"This provision would unfairly burden Arkansas and every other state, as we would be compelled to pay for the special status afforded to the Nebraska Medicaid program," McDaniel said.

Other Democratic attorneys general who have been publicly critical of the Nebraska deal include Terry Goddard of Arizona, Richard Cordray of Ohio and Jack Conway of Kentucky.

McDaniel, co-chairman of the Democratic Attorneys General Association, said threatening litigation over the controversial deal is out of order.

"Although such threats make for good politics, I do not believe that the states would have a winning lawsuit based on what I know at this time," McDaniel said.

The Senate legislation requires that states provide Medicaid coverage to anyone making up to 133 percent of the federal poverty level -- a move that will likely expand the number of Medicaid-eligible persons throughout the country and increase the financial burden on the states since they bankroll part of the program.

Before a final bill is sent to President Barack Obama the House and Senate health care bills must be reconciled in conference committee.

From Legal Newsline: Reach staff reporter Chris Rizo at

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