This document presents witnesses' testimonies and prepared statements from two of three Senate hearings called to examine budget issues affecting the Medicare, Medicaid, and Maternal and Child Health Block Grant programs, including changes in the Medicare program necessary to reduce spending in accordance with the budget resolution and expansions of coverage under Medicaid and Maternal and Child Health Block Grant. The first hearing, focusing on Part A of the Medicare Program, includes testimonies from Stuart Altman, Prospective Payment Assessment Commission; Jack W. Owen, American Hospital Association; Michael D. Bromberg, Federation of American Health Systems; Charles M. O'Brien, Jr., Georgetown University Hospital; Kay Hollers, Government Affairs Committee of the National Association for Home Care; and Cynthia Polich, Interstudy. The second hearing, focusing on Part B of the Medicare Program, includes testimonies from Uve Reinhardt, Physician Payment Review Commission; James Sammons, American Medical Association; N. Thomas Connally, American Society of Internal Medicine; James G. Jones, American Academy of Family Physicians; Paul A. Ebert, American College of Surgeons; and Bruce E. Spivey, American Academy of Opthalmology. Supplemental materials are included. (NB)