The pronouncements of gratitude that flowed from state capitals last week toward Washington suggested some landmark legislation had been passed. Instead, it was merely the passage of an amendment to raise Medicaid rates, temporarily supplying $9 billion more to states. The gratitude indicates the awful condition of most state budgets, and the solution for budget shortfalls – to raise funding in the area with the fastest-rising costs, health care – was a terrific response by the Senate.

Maine Sen. Susan Collins along with Sens. Jay Rockefeller, Ben Nelson and Gordon Smith deserve credit for recognizing the effect of state shortfalls on a broad range of services and writing a bill that helps state meet their obligations. Sen. Olympia Snowe was a co-sponsor of the bill, appropriately called the State Fiscal Relief Act, which will provide Maine with $54 million if approved.

Gov. King announced he was “delighted to hear that the Senate has passed the State Fiscal Relief Act, an incredibly important piece of legislation to Maine.” The chairman of the National Governors Association, Kentucky Gov. Paul Patton, said the bill was “an important first step to helping states maintain service levels during the continuing fiscal crisis.” The association’s vice chairman, Idaho Gov. Dirk Kempthorne, said, “It was imperative for the Senate to recognize that states needed significant assistance.” Happy governors offered adulations across the land.

It was Sen. Collins, however, who noted specifically what would happen without the bill: “Essential programs ranging from state funding for long-term care and residential care to innovative programs such as Experience at Sea, which helps older foster children adapt responsibly to the adult world, are being cut back or cut altogether due to this funding crisis, and Maine families will be all the worse for it.”

Maine still will have a large budget shortfall to make up and, because the higher Medicaid rates last only 18 months, it will still have a sizeable gap in its next budget. But the added funding gives all states time to consider its options more carefully, to analyze which cuts make sense and which will end up costing more over the long term.

The Medicaid bill is an amendment to a popular proposal to encourage the use of cost-saving generic drugs and should pass the Senate soon. It will depend on House action to become law, and already some of members of Congress are worrying about its price. They are right to be concerned about the amount of money Congress spends, but after recently supporting a bloated Farm Bill 10 times the size of this one, wrong about the timing. They should back this important proposal to improve the health of both state residents and state budgets.