Tuesday, February 23, 2010

Senate Jobs Bill Does Not Require that Employers Hire American Workers

/PRNewswire/ -- A $15 billion package of tax credits and exemptions for employers who create new jobs is expected to gain approval by the Senate this week. However, the bill, intended to help millions of unemployed American workers find jobs, includes no verification mechanism to ensure that newly created jobs will actually be filled by legal U.S. workers. Moreover, it does not prevent employers from claiming tax credits and exemptions if the workers they hire are illegal aliens, charges the Federation for American Immigration Reform (FAIR).

The legislation, authored by Senate Majority Leader Harry Reid (D-Nev.), does not require employers to use the federal E-Verify system to ensure that the workers being hired are legally eligible to work in the United States. Under an executive order issued by President Bush and implemented by President Obama, all federal contractors are already required to use E-Verify and the same requirement could easily have be applied to employers claiming tax credits and exemptions. In 2009, Sen. Reid stripped an E-Verify requirement from the $787 billion stimulus package that had been approved by the House when the bill went before a conference committee.

"It is unconscionable that while some 25 million Americans are unemployed or relegated to part-time work, the Senate is refusing to include protections that would guarantee that newly-created jobs are filled by Americans who desperately need them," said Dan Stein, president of FAIR. "The failure to include E-Verify protections in the bill is not an oversight on the part of Sen. Reid. He has consistently blocked efforts to prevent employers who receive government contracts or tax benefits from hiring illegal aliens instead of legal U.S. workers."

Under the Senate legislation, employers who fill newly created jobs with illegal aliens or guest workers would be entitled to the same tax credits and exemptions as employers who hire out-of-work Americans. Even if the employer were subsequently prosecuted for employing illegal aliens, the employer could legitimately claim these tax benefits for hiring them.

Because Sen. Reid has barred any amendments from being considered when the bill goes to the Senate floor, it will be virtually impossible for members to add E-Verify protections for American workers. "The excuse being offered for not including E-Verify in the legislation and barring its inclusion in the final language is laughable," Stein said. "Opponents of inclusion of an E-Verify provision claim it is unnecessary because existing laws already bar employers from hiring illegal aliens. This claim ignores the fact that an estimated 8 million illegal aliens already hold jobs in the U.S.

"Unemployed Americans have a right to expect that they will be the beneficiaries of any jobs created as a result of this bill. American taxpayers who will be footing the bill for this and other legislation have a right to expect that their money will help put Americans back to work," Stein continued. "These expectations could be easily fulfilled by requiring the use of E-Verify and barring employers who do not hire legal U.S. workers from receiving tax benefits - something Reid and Senate Democrats are refusing to do."

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Thursday, February 18, 2010

Obama Administration Grants Relief to States on Payments to Medicarefor Part D Costs

HHS Secretary Kathleen Sebelius today announced $4.3 billion in financial relief to states by reducing the amount they will have to pay the federal government to offset the cost of Medicare coverage for prescription drugs for state residents eligible for both Medicare and Medicaid.

“We believe today’s action will help states as they struggle to maintain Medicaid and other budget priorities in these difficult economic times,” said Secretary Sebelius. “This relief will help states continue to provide critical health care services to the nearly 60 million beneficiaries who depend upon it.”

This temporary financial boost to states is made possible by the American Recovery and Reinvestment Act of 2009 (ARRA). That law granted a significant, yet temporary, increase in the amount states receive from the federal government to help pay for their Medicaid programs. The increase was to the federal share of Medicaid costs, referred to as federal medical assistance percentage payments (FMAP).

In a call with state governors today, Secretary Sebelius reported that HHS will apply the ARRA increased FMAP to so-called clawback payments. The clawback payment is the amount states pay to the federal government as required by the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA). It is intended to offset some of the added expense to Medicare Part D of assuming drug costs for residents dually eligible for both programs. Prior to MMA, state Medicaid programs covered prescription drug costs for these beneficiaries. Because Medicaid is a state/federal matching program, the higher FMAP under ARRA results in a temporary reduction of the states’ share of spending and therefore in their clawback obligation.

This temporary adjustment in the clawback payments will be applied for the period October 1, 2008 through December 31, 2010. In his 2011 budget, President Obama calls for the FMAP increase established in ARRA to be extended through June 30, 2011.

“In asking Congress to extend the increased FMAP in his 2011 budget proposal, the President recognizes both the critical role Medicaid plays in the health of our most vulnerable citizens and difficulties states are experiencing given the economic downturn,” Secretary Sebelius said.

States make clawback payments monthly and CMS is currently reprogramming its billing system to calculate the new, reduced payments owed by states. The savings, which are retroactive to October 2008, will be deducted from what they otherwise would have owed going forward.

The table below shows each state’s estimated savings. Column B shows the state’s obligation under the pre-ARRA formula with column C showing the newly calculated payment, column D the total estimated savings to the state.

State (A)

Total Q1 FY 09 Thru Q1 FY 11 Clawback Based on Reg. FMAP (B)

Total Q1 FY 09 Thru Q1 FY 11 Clawback Based on ARRA FMAP (C)

Total State Savings/Fed. Cost Q1 FY 09 Thru Q1 FY 11 (D)

































District of Columbia




















































































New Hampshire




New Jersey




New Mexico




New York




North Carolina




North Dakota




















Rhode Island




South Carolina




South Dakota




























West Virginia