Democrats wary of accord on Medicaid and welfare Clinton is warned against governors' reform plan


WASHINGTON -- A day after the nation's governors offered him a plan that might break the budget stalemate, President Clinton came under mounting pressure from within his own party yesterday to keep his distance from their proposals to reshape the huge Medicaid and welfare programs.

Democrats who were initially guarded about the plan are now arguing that Mr. Clinton's signature on such a deal would hand a big victory to the Republican side while undoing basic Democratic legislation.

Combined with sniping from some members of the GOP rank and file that the plan costs too much and fails to follow conservative social principles, these criticisms appeared to reduce chances that the delicately balanced proposal would survive its trip through Congress.

"This is a huge victory for the Republicans and a big loss for the president -- if he signs on," said Rep. Robert T. Matsui, a California Democrat. "And I would urge him not to."

The proposals were accepted by a unanimous vote of the National Governors' Association at the group's winter meeting Tuesday. Hearings on the plan may begin the week of Feb. 20.

The Medicaid reform proposal would give the states greater flexibility to design their programs, and to control the programs' costs, while still trying to guarantee that the elderly and needy receive the health care they require. But the critics contend that the proposal would effectively end the guarantee by allowing governors much greater latitude to define which older people, disabled and children get covered, and how much they are provided.

"This ends the federal entitlement and replaces it with a block grant," said Rep. Henry A. Waxman, another California Democrat. "That's the proposal we fought against, and the one that the president objected to. I don't see how he can support it now."

The welfare proposal, designed to push more recipients toward work, includes several features that the Democrats liked, such as more money for child care, and bonuses for states that succeed in finding jobs for welfare recipients.

Yet the critics see holes in it: It is not clear who will be exempt from the plan's total five-year limit on benefits. And they fear it could allow states to cut back on their commitment to the food stamp program that the federal government has viewed as an essential safety net.

When Mr. Clinton suggested earlier this year he could accept a GOP version of welfare reform that ended that so-called "entitlement" status of welfare, he came under heavy fire from liberal Democrats, including Sen. Daniel Patrick Moynihan, a New York Democrat. Asked about the governors' recommendations yesterday, Mr. Moynihan said tersely: "They are headed into hearings. I'd be appalled" if the welfare recommendations were enacted.

At the White House, officials continued to praise the governors' proposal as a constructive move. Carol Rasco, assistant to the president for domestic policy, called the proposal a "very positive step."

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