[Congressional Record Volume 149, Number 3 (Thursday, January 9, 2003)]
[Senate]
[Pages S164-S166]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ROCKEFELLER (for himself, Ms. Collins, Mr. Nelson of 
        Nebraska, Mr. Smith, Mrs. Clinton, Mrs. Hutchison, and Mr. 
        Graham of Florida):
  S. 138. A bill to temporarily increase the Federal medical assistance 
percentage for the medicaid program; to the Committee on Finance.
  Mr. ROCKEFELLER. Mr. President, this budget cycle State legislators 
face the largest deficits in 50 years. To balance combined budget 
deficits of $60 to $85 billion, most States will be forced to raise 
taxes and cut spending. In July of last year, 75 Senators voted to 
provide meaningful fiscal relief to the states. That is why I return to 
the floor today to introduce ``The State Budget Relief Act of 2003,'' 
with my friends and colleagues Senators Collins, Ben Nelson, and Gordon 
Smith. This bipartisan legislation will provide $20 billion in 
immediate assistance to states to help pay for increases in Medicaid 
enrollment due to rising unemployment and to stop cuts in health 
insurance coverage, child care, education and other social services due 
to state budget crises.
  As one of the largest State programs, Medicaid has become 
increasingly vulnerable as a target for cuts. In 11 States, legislators 
have proposed and adopted cuts that when fully implemented will strip 
health insurance coverage from approximately one million low-income 
people. Further, when governors release their budgets this month, that 
number is expected to climb much higher than one million. Most of these 
people are parents and children in working families that will go 
uninsured without Medicaid coverage.
  If States are forced to institute further Medicaid cuts, our most 
vulnerable Americans will be left out in the cold. In West Virginia, 
Medicaid provides coverage to 14 percent of the population. Just this 
week, a West Virginia health clinic, which provides the only care for 
Medicaid patients in town, was forced to lay off 18 employees. The 
clinic is at risk because the State Medicaid program does not have the 
money to pay it for services.
  These problems are not unique to West Virginia. Stories from across 
the country show that many states will be forced to seek solutions to 
their budget crises at the expense of low-income people covered by 
Medicaid. On December 30th, the LA Times reported that California is 
considering proposals that would cut coverage for 500,000 people by the 
end of fiscal year 2004. This is more than one-third of the total 
number of people, nationally, who lost coverage in all of 2001.
  Some Senators might ask why we should help the States. The answer to 
that question is that the current economic downturn and the continuing 
State fiscal crises are hurting people across this country and a great 
many more people will be hurt in the next 18 months. The budget 
deficits are too large for States to cover alone without threatening 
the health and welfare of millions of Americans.
  The bipartisan ``State Budget Relief Act'' provides a temporary 
increase in Federal Medicaid matching rates, which will help reduce the 
pressure on states to cut health insurance coverage for low-income 
families and individuals. It grants states money that they can use for 
social services such as education and child care. Finally, the bill 
holds States harmless for reduced Federal match rates in fiscal year 
2002. As a result of these provisions, West Virginia would receive $127 
million to help balance its budget.
  I want to stress that this proposal is a critical component of 
economic stimulus. In this time of economic downturn, we need to ensure 
that there will be a safety net for low-income people and that states 
are not placing a further drag on the economy in efforts to balance 
their budgets. Several States have completed Medicaid economic impact 
studies within the last year. These reports conclude that in addition 
to the personal toll that loss of coverage takes on people, Medicaid 
cuts create an economic ripple effect by contributing to job and income 
losses for individuals and reduced output for businesses. The 
President's proposed economic stimulus package ignores this storm 
brewing in the States. It provides no fiscal relief for states and, in 
fact, worsens the problem by reducing state revenues by more than $4 
billion a year through the individual tax cut on dividends.
  In contrast, our bipartisan proposal provides immediate, temporary 
relief to States that will complement other economic stimulus 
strategies while protecting the health of millions of Americans. It 
will be effective for 18 months from April 2003. I am extremely 
disappointed that the Administration failed to include any real relief 
for the states in its own massive stimulus package. I think that is a 
serious mistake, and I will fight to include the proposal introduced by 
Senators Collins, Ben Nelson, Gordon Smith and myself in any stimulus 
package we deal with in the Senate Finance Committee or on the floor.
  I ask unanimous consent that the text of this bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 138

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION. 1. TEMPORARY STATE FISCAL RELIEF.

       (a) Temporary Increase of Medicaid FMAP.--
       (1) Permitting maintenance of fiscal year 2002 fmap for 
     last 2 calendar quarters of fiscal year 2003.--
     Notwithstanding any other provision of law, but subject to 
     paragraph (5), if the FMAP determined without regard to this 
     subsection for a State for fiscal year 2003 is less than the 
     FMAP as so determined for fiscal year 2002, the FMAP for the 
     State for fiscal year 2002 shall be substituted for the 
     State's FMAP for the third and fourth calendar quarters of 
     fiscal year 2003, before the application of this subsection.
       (2) Permitting maintenance of fiscal year 2003 fmap for 
     fiscal year 2004.--Notwithstanding any other provision of 
     law, but

[[Page S165]]

     subject to paragraph (5), if the FMAP determined without 
     regard to this subsection for a State for fiscal year 2004 is 
     less than the FMAP as so determined for fiscal year 2003, the 
     FMAP for the State for fiscal year 2003 shall be substituted 
     for the State's FMAP for each calendar quarter of fiscal year 
     2004, before the application of this subsection.
       (3) General 2.45 percentage points increase for last 2 
     calendar quarters of fiscal year 2003 and fiscal year 2004.--
     Notwithstanding any other provision of law, but subject to 
     paragraphs (5) and (6), for each State for the third and 
     fourth calendar quarters of fiscal year 2003 and each 
     calendar quarter of fiscal year 2004, the FMAP (taking into 
     account the application of paragraphs (1) and (2)) shall be 
     increased by 2.45 percentage points.
       (4) Increase in cap on medicaid payments to territories.--
     Notwithstanding any other provision of law, but subject to 
     paragraph (6), with respect to the third and fourth calendar 
     quarters of fiscal year 2003 and each calendar quarter of 
     fiscal year 2004, the amounts otherwise determined for Puerto 
     Rico, the Virgin Islands, Guam, the Northern Mariana Islands, 
     and American Samoa under subsections (f) and (g) of section 
     1108 of the Social Security Act (42 U.S.C. 1308) shall each 
     be increased by an amount equal to 4.90 percent of such 
     amounts.
       (5) Scope of application.--The increases in the FMAP for a 
     State under this subsection shall apply only for purposes of 
     title XIX of the Social Security Act and shall not apply with 
     respect to--
       (A) disproportionate share hospital payments described in 
     section 1923 of such Act (42 U.S.C. 1396r-4); or
       (B) payments under title IV or XXI of such Act (42 U.S.C. 
     601 et seq. and 1397aa et seq.).
       (6) State eligibility.--
       (A) In general.--Subject to subparagraph (B), a State is 
     eligible for an increase in its FMAP under paragraph (3) or 
     an increase in a cap amount under paragraph (4) only if the 
     eligibility under its State plan under title XIX of the 
     Social Security Act (including any waiver under such title or 
     under section 1115 of such Act (42 U.S.C. 1315)) is no more 
     restrictive than the eligibility under such plan (or waiver) 
     as in effect on September 2, 2003.
       (B) State reinstatement of eligibility permitted.--A State 
     that has restricted eligibility under its State plan under 
     title XIX of the Social Security Act (including any waiver 
     under such title or under section 1115 of such Act (42 U.S.C. 
     1315)) after September 2, 2003, but prior to the date of 
     enactment of this Act is eligible for an increase in its FMAP 
     under paragraph (3) or an increase in a cap amount under 
     paragraph (4) in the first calendar quarter (and subsequent 
     calendar quarters) in which the State has reinstated 
     eligibility that is no more restrictive than the eligibility 
     under such plan (or waiver) as in effect on September 2, 
     2003.
       (C) Rule of construction.--Nothing in subparagraph (A) or 
     (B) shall be construed as affecting a State's flexibility 
     with respect to benefits offered under the State medicaid 
     program under title XIX of the Social Security Act (42 U.S.C. 
     1396 et seq.) (including any waiver under such title or under 
     section 1115 of such Act (42 U.S.C. 1315)).
       (7) Definitions.--In this subsection:
       (A) FMAP.--The term ``FMAP'' means the Federal medical 
     assistance percentage, as defined in section 1905(b) of the 
     Social Security Act (42 U.S.C. 1396d(b)).
       (B) State.--The term ``State'' has the meaning given such 
     term for purposes of title XIX of the Social Security Act (42 
     U.S.C. 1396 et seq.).
       (8) Repeal.--Effective as of October 1, 2004, this 
     subsection is repealed.
       (b) Additional Temporary State Fiscal Relief.--
       (1) In general.--Title XX of the Social Security Act (42 
     U.S.C. 1397-1397f) is amended by adding at the end the 
     following:

     ``SEC. 2008. ADDITIONAL TEMPORARY GRANTS FOR STATE FISCAL 
                   RELIEF.

       ``(a) In General.--For the purpose of providing State 
     fiscal relief allotments to States under this section, there 
     are hereby appropriated, out of any funds in the Treasury not 
     otherwise appropriated, $10,000,000,000. Such funds shall be 
     available for obligation by the State through June 30, 2005, 
     and for expenditure by the State through September 30, 2005. 
     This section constitutes budget authority in advance of 
     appropriations Acts and represents the obligation of the 
     Federal Government to provide for the payment to States of 
     amounts provided under this section.
       ``(b) Allotment.--Funds appropriated under subsection (a) 
     shall be allotted by the Secretary among the States in 
     accordance with the following table:

       

------------------------------------------------------------------------
               ``State                       Allotment (in dollars)
------------------------------------------------------------------------
 Alabama                                $113,960,092
 Alaska                                 $28,050,916
 Amer. Samoa                            $276,005
 Arizona                                $174,176,300
 Arkansas                               $88,932,482
 California                             $1,055,900,700
 Colorado                               $95,353,555
 Connecticut                            $138,136,104
 Delaware                               $25,691,623
 District of Columbia                   $43,356,542
 Florida                                $416,437,302
 Georgia                                $245,721,379
 Guam                                   $446,563
 Hawaii                                 $30,891,959
 Idaho                                  $32,439,936
 Illinois                               $362,420,855
 Indiana                                $181,086,404
 Iowa                                   $86,873,236
 Kansas                                 $62,913,352
 Kentucky                               $141,415,311
 Louisiana                              $159,884,723
 Maine                                  $61,854,394
 Maryland                               $157,333,510
 Massachusetts                          $315,177,172
 Michigan                               $290,300,805
 Minnesota                              $201,619,700
 Mississippi                            $117,970,775
 Missouri                               $201,689,388
 Montana                                $24,291,445
 Nebraska                               $53,033,542
 Nevada                                 $34,887,749
 New Hampshire                          $36,067,567
 New Jersey                             $274,636,614
 New Mexico                             $75,233,465
 New York                               $1,588,884,965
 North Carolina                         $293,161,659
 North Dakota                           $18,169,187
 N. Mariana Islands                     $155,920
 Ohio                                   $410,965,675
 Oklahoma                               $97,493,874
 Oregon                                 $111,334,973
 Pennsylvania                           $497,241,778
 Puerto Rico                            $12,610,820
 Rhode Island                           $53,399,083
 South Carolina                         $122,811,620
 South Dakota                           $20,201,430
 Tennessee                              $233,515,925
 Texas                                  $543,148,021
 Utah                                   $42,281,420
 Vermont                                $27,033,142
 Virgin Islands                         $416,332
 Virginia                               $143,436,753
 Washington                             $199,131,541
 West Virginia                          $63,879,139
 Wisconsin                              $180,600,752
 Wyoming                                $11,664,525
------------------------------------------------------------------------
 Total                                  $10,000,000,000
------------------------------------------------------------------------

       ``(c) Use of Funds.--Funds appropriated under this section 
     may be used by a State for services directed at the goals set 
     forth in section 2001, subject to the requirements of this 
     title.
       ``(d) Payment to States.--Not later than 30 days after 
     amounts are appropriated under subsection (a), in addition to 
     any payment made under section 2002 or 2007, the Secretary 
     shall make a lump sum payment to a State of the total amount 
     of the allotment for the State as specified in subsection 
     (b).
       ``(e) Definition.--For purposes of this section, the term 
     `State' means the 50 States, the District of Columbia, and 
     the territories contained in the list under subsection 
     (b).''.
       (2) Repeal.--Effective as of October 1, 2005, section 2008 
     of the Social Security Act, as added by paragraph (1), is 
     repealed.
       (c) GAO Study and Report.--
       (1) Study.--The Comptroller General of the United States 
     shall conduct a study to determine the most appropriate data 
     and methodology to use to determine the Federal medical 
     assistance percentage for purposes of programs authorized 
     under the Social Security Act.
       (2) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall submit a report to Congress on the study 
     conducted under paragraph (1).

  Mr. NELSON of Nebraska. Mr. President, today I am pleased to 
introduce legislation to assist State governments badly hurt by poor 
economic conditions and declining revenue. This legislation, that I am 
proud to be introducing with my good friends Senators Collins and 
Rockefeller, will provide $20 billion in Federal assistance to States.
  Last July, 75 of our colleagues agreed with us that we need to help 
the States and passed a similar plan that we authored. Unfortunately, 
the House failed to act on our bill. In that timeframe, the budget 
situation in the States has gotten worse, not better. New estimates 
show the States facing a $60 to $85 billion shortfall next year. This 
is why I come to the floor today to introduce ``The State Budget Relief 
Act of 2003.''
  The Federal and State governments are a partnership. When State 
governments are in a budget crisis, the Federal Government must step in 
and fulfill the obligations to the programs people rely on. We have the 
same constituents and the same goals.
  The bipartisan fiscal relief package will provide assistance through 
a temporary increase in the Federal Medical Assistance Percentage, 
FMAP, of Medicaid and $10 billion in social service block grants. This 
bill strikes a good balance by providing direct relief to Medicaid, 
which is one of the fastest growing programs in State budgets, while 
giving Governors needed flexibility through the block grants. This 18-
month package will provide over $104 million in new funds to Nebraska.
  As a former Governor, I know how hard it is for States to maintain a 
balanced budget. I urge my colleagues to support this legislation and 
take that step to avert, at least in part, potentially damaging cuts to 
Medicaid as well as to other social services programs. If we do not 
help the States, any other Federal economic stimulus will likely be 
lost in State and local tax hikes and spending cuts.

[[Page S166]]

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