- In March, Congress passed a historic $2 trillion stimulus package to shore up the economy.
- The
CARES Act includes $150 billion for state and local governments to help them respond to thecoronavirus crisis. - But the money hasn't been distributed evenly: Rural states are receiving a disproportionate amount of relief funds relative to their COVID-19 case and death counts, according to the Center for Budget and Policy Priorities.
- That has major implications for states with larger outbreaks, since governments are being forced to make severe cuts to programs like Medicaid, even as millions lack health insurance.
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New York state, the epicenter of the coronavirus crisis in the US, has reported more than 320,000 confirmed cases, while Alaska has around 371. But in terms of federal relief funds, New York's government will likely receive $23,000 per case, while Alaska's will get $3.4 million per case.
That's according to an analysis of the CARES Act — a $2 trillion stimulus package passed by Congress in March — done by the Center for Budget and Policy Priorities.
To put that federal money in perspective, Medicare pays hospitals between $13,000 and $40,000 on average to treat people hospitalized with respiratory illnesses, depending on how much care they need, according to the Kaiser Family Foundation.
Overall, the CARES Act set aside $150 billion for state and local governments to fight the coronavirus crisis and its impacts. The money isn't being distributed according to the size of state's COVID-19 outbreaks, however, leaving many with significantly less aid relative to the number of patients and unemployed residents they're now trying to support.
Under the bill, every state automatically receives a minimum of $1.25 billion, and 21 states will likely receive that minimum amount, according to CBPP's estimates. California and Texas could each get more than $10 billion.
Here's how much money states will likely receive under the CARES Act, relative to the number of COVID-19 cases and deaths in their states as of May 6.
Political realities
Three states — Ohio, Colorado, and Georgia — are already scaling back their Medicaid spending as demand for the health-insurance program grows due to the tidal wave of layoffs leaving workers without health insurance.
"The cruel nature of the economic downturn is that a time when you need a social safety net is also the time when government revenues shrink," Ohio Gov. Mike DeWine said at the press conference.
Republican Sen. Bill Cassidy of Louisiana and Democratic Sen. Bob Menendez of New Jersey, who represent two of the states hit hardest by the pandemic, have attempted to remedy federal funding disparities by proposing an additional $500 billion in relief money for state and local governments.
Their bill would allocate money based on states' populations, infection rates, and revenue losses, in order to ensure that funds go where they're needed most. But the bill still guarantees another $1.25 billion minimum to each state, a stipulation that Menendez acknowledged is a result of the structure of the Senate.
"We need to get 60 votes in the Senate," he told the Associated Press.
States are also up against the political agenda of President Donald Trump, who said this week that he may condition federal aid to states battling the coronavirus on whether they eliminate sanctuary cities, payroll taxes, and capital-gains taxes.
Trump has faced political backlash for the suggestion and it's not clear whether the move would be legal.
Sonam Sheth and Joseph Zeballos-Roig contributed reporting to this story.
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