President Bush today spoke to the nation's governors, saying that he would work with them to reduce the costs of Medicaid, which has been increasingly straining state budgets. From the Post this afternoon:

Before the White House meeting, governors said they opposed Bush's proposal to cut some $40 billion from the system. They also wanted the ability to experiment in order to lower costs. Many were encouraged by parts of the administration's budget proposal that would give states more flexibility.

"We want Medicaid to work," Bush told the governors before a brief, private question-and-answer session. "The system needs to be reformed and we want to work with governors."

But the one detail Bush emphasized was his plan to cut federal dollars in an effort to stop state Medicaid accounting practices that the administration contends cheats taxpayers.

Many state leaders say the money derived this way is essential. Federal officials say it artificially inflates health care prices to bring in more federal cash, which states sometimes use for other purposes.

Restraining the growth of Medicaid payments is a big issue for states, who have seen the program begin to take up over 20% of their budget each year.

Over on our analysis side we've got a look at the latest news surrounding the highway funding minimum guarantee provisions for the re-authorization of TEA-21. Be sure to check it out.

Here's the list of all the Appropriations Subcommittee Deadlines in the House:

The House Appropriations Committee Subcommittee on Transportation, Treasury and HUD has published the form they want filled-out for each earmark request in the fiscal 2006 cycle. Clients can go to the Analysis side to see the document itself.

Congress, governors and the new Secretary of Health and Human Services began negotiations yesterday on the future of Medicaid. Congress and the governors are trying to develop a relationship like the one that produced the changes in federal welfare law in 1996.

Sen. Grassley, (R-Iowa), Chairman of the Senate Finance Committee said that there needed to be some immediate savings in Medicaid and also enough flexibility for states to absorb the changes but it would be very difficult to reach agreement this year.

Medicaid spending has increased by 63% in the last five years, so that state and federal outlays together now total more than $300 billion a year. With no change in current law, the Congressional Budget Office predicts the cost will grow an average of 7.7% a year in the next decade.

Governors want to slow the growth of Medicaid, which they say is eating up state tax revenues they want to use for education.

Michael Leavitt, Secretary of Health and Human Services said the Bush administration wants to give states more freedom to decide who gets what benefits. At the same time, Sec. Leavitt said, the administration will crack down on what he described as abusive practices used by many states to maximize the federal Medicaid money they receive.

Governors fear that Congress, in an effort to reduce the federal deficit, will limit federal Medicaid spending without relieving the states of any of their legal or financial obligations.

President Bush proposes to cut $60 billion from projected federal Medicaid spending of $2.8 trillion in the next decade.

Leavitt has said that states should be free to provide less comprehensive benefits to “optional populations”, whom they are not required to cover.

This morning President Bush named John Negroponte to occupy the position of National Intelligence Director. Negroponte is currently serving as the Ambassador to Iraq.

The National Intelligence Director will have budgetary and operations control over the entire Intelligence Community, comprising several different agencies including the NSA, CIA, NRO and DIA. Bush named the current chief of the NSA, Gen. Michael Hayden, to be Negroponte's deputy at the new position.

Here's a list of all the new ranking members of the House Appropriations Subcommittees:

Today President Bush nominated acting FDA head Lester M. Crawford to permanently helm the agency.

Crawford has led the Food and Drug Administration (FDA) in some capacity for almost three years, a period that has seen a number of drug safety issues come to the forefront of public attention.