The financing of a Medicaid expansion that will be part of the Senate Finance Committee’s healthcare reform proposal should please state officials. That is according to Chairman Max Baucus (D-MT), who is leading efforts to create a bipartisan reform package.

He said this week he expects state officials to be “pleasantly surprised,” according to a report by the Bureau of National Affairs. The growth in Medicaid spending has crippled many states, forcing them to make drastic cuts to the program. Nursing homes are often a casualty of such reductions. Baucus said the estimated $880 billion healthcare reform bill would likely be released today.

A proposal released by Baucus last week would expand Medicaid income eligibility standards nationwide. Effective Jan. 1, 2014, Medicaid would be available to all those with incomes up to 133% of the federal poverty level. Federal and state governments would share the cost. To help defray the cost of covering newly eligible individuals, additional federal financial assistance will be available to all states, the proposal said.