A day before exchanging salary figures, Philadelphia agreed to pay Lidge $6.35 million in 2008, a raise of $1 million.
Madson will earn $1.4 million, or a $300,000 bump. Both pitchers will also receive performance bonuses.
Lidge went 5-3 with a 3.36 ERA and had 19 saves in 66 games for the Astros in 2007. He was acquired with infielder Eric Bruntlett in November for outfielder Michael Bourn, reliever Geoff Geary and infielder Michael Costanzo, who was later traded by the Astros to the Orioles in the Miguel Tejada deal.
Madson went 2-2 with one save and a 3.05 ERA in 38 games last season. His year ended on July 30 when he strained his right shoulder.
Bruntlett and Ryan Howard are the Phillies only two remaining arbitration cases.
However, Howard's situation could get sticky. The Phillies explored the possibility of a long-term contract with the slugger last offseason before renewing him for $900,000.
Philadelphia will try that route again this time. But even if they don't agree on a multiyear deal, Howard can't become a free agent until after the 2011 season.
Ken Mandel is a reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.