Negotiators digging in as final days of session approach.

The House and Senate have finished their work for the day and are scheduled to come back at noon tomorrow. Meanwhile, Governor Pawlenty and DFL legislative leaders are scheduled to hold a conference call tonight at 8:30 to continue budget negotiations. The same issues are in play (ratification of unallotments, K12 shift and Medicaid expansion) for a deal. But there appears to be some saber rattling over the Health and Human Services portion of the deal.

"Early option Medical Assistance is very important for us to come to an agreement," DFL House Speaker Margaret Anderson Kelliher said. "I think it makes it extremely difficult to get a deal wlithout it."

Kelliher said she was working to craft a budget deal but said she's leaving all options on the table including the possibility of a special session if one is needed.

It appears that the Health and Human Services bill could be the key factor in whether a deal gets done. House and Senate Democrats want to shift low income Minnesotans from two state health programs into a federal program. They argue that the plan will provide health care coverage for another 20,000 Minnesotans and stabilize funding for hospitals and other health care providers.

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Governor Pawlenty and Republicans in the House and Senate are objecting to the surcharges on hospitals, HMOs and other health centers to pay for the program.

Pawlenty's spokesman Brian McClung sent a statement to reporters saying the proposals is "problematic because of the DFL's insistence on surcharges as well as a lack of support for early enrollment from Republicans." McClung said in a follow up e-mail that Pawlenty remains open to discussing the issue..

Lawmakers are working to craft a budget deal and pass it before the Sunday midnight deadline to adjourn. DFL Senate Majority Leader Larry Pogemiller spent a large part of the day criticizing the governor's approach to solving the nearly $3 billion budget deficit. He said Pawlenty is relying on shifts and gimmicks that won't solve the state's long-term budget problem. Pogemiller said , however, that he's holding out hope a budget deal will be reached. He said Senate Democrats are prepared to send Pawlenty another bill that reduces the size of the deficit if a deal isn't reached.

"For sure, I think we should send $700 or $800 million in cuts or budget reductions," Pogemiller said. "Some of those are budget reductions that the Governor doesn't support but at some point you have to do something."

All four legislative leaders are scheduled to appear on TPT's Almanac tonight at 7pm.