Yesterday, the Senate passed an amendment to the war supplemental bill that will put the brakes on several controversial Medicaid regulations. The Bush administration has finalized, or is preparing to finalize, the regulations in an effort to cut federal funding for a variety of Medicaid programs administered by the states. (More details on the regulations here.) The administration developed the regulations under the guise of "fiscal integrity," arguing state Medicaid programs are using loopholes to inappropriately claim federal funds. Bush has threatened to veto the bill. Fortunately, the amendment passed the Senate in a 75-22 vote and also cleared the House by a veto-proof margin. On May 6, more than 100 hospitals, providers, school districts and public interest groups (including OMB Watch) wrote to Congress in support of the legislation, which will place moratoria on all seven of the regulations until April 1, 2009. The letter says, "Taken together, the impact of these regulations would undermine the viability of our nation's health care safety net and reduce or eliminate access to health care services for many millions of low income patients." Critics also question the administration's authority to make such major changes to Medicaid. For example, one of the proposed rules would limit the ability of state governments to provide rehabilitation services (such as transitions to independent housing) for people with mental illnesses or developmental disabilities. The Bush administration floated this limitation as a legislative proposal in 2006, but Congress rejected it. Kudos to members in both chambers voting yea: they stood up to the administration's efforts to hobble state Medicaid programs. From a government operations standpoint, Congress should also be commended for reestablishing control over issues that are properly within its purview and rebuking the administration's efforts to reinterpret federal law through administrative means.