[Congressional Record Volume 155, Number 178 (Thursday, December 3, 2009)]
[Senate]
[Pages S12328-S12330]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. Reed (for himself, Mr. Brown, Mr. Whitehouse, Mr. Akaka, 
        Mr. Durbin, Ms. Klobuchar, and Mr. Begich):
  S. 2833. A bill to provide adjusted Federal medical assistance 
percentage rates during a transitional assistance period; to the 
Committee on Finance.
  Mr. REED. Mr. President, I rise today to introduce the Transitional 
Federal Medical Assistance Percentage, FMAP, Act, and I am pleased to 
do so with the support of Senators Brown, Whitehouse, Akaka, Durbin, 
Klobuchar, and Begich. This bill is an important step in continuing the 
conversation about how we can help our States, businesses, and 
individuals as our economy recovers.
  In my State of Rhode Island, the economic downturn has been 
particularly hard hitting on families and businesses. As a result, the 
State has seen a decline in tax revenue and an increased enrollment in 
safety net programs like Medicaid. Revenue from the sales tax is down 
over 7 percent, income tax receipts are down 2.3 percent, and corporate 
tax revenue is down nearly 10 percent. At the same time, unemployment 
rates have soared to new heights, topping 13 percent earlier this year. 
In the past 2 years, 40,000 Rhode Islanders have lost their employer-
sponsored health insurance. Many of these individuals have come to rely 
on Medicaid for health coverage. This has caused great strain on the 
State's resources and its Medicaid program. In November, we learned 
that the estimated Medicaid caseload for the year will cost over $40 
million more than what the State had initially estimated in its budget.
  The American Recovery and Reinvestment Act, which I supported, 
provided States with additional Federal assistance through 2010. States 
have used these funds to help balance their budgets, minimize harmful 
cuts in public services, and, very importantly, to prevent tax 
increases in many cases. However, even with the funding from the 
Recovery Act, Rhode Island will close the current fiscal year $219.8 
million in the red.
  A total of 38 States have looked ahead to fiscal year 2011, and they 
have estimated $92 billion in combined deficits in the coming year. As 
the State fiscal year nears, and more States have had ample time to 
analyze their fiscal health it is expected that the total shortfall 
will likely equal $180 billion.
  As Congress debates health reform and works to ensure that every 
American has access to health insurance in 2014, we must not forget 
about ensuring that Americans have access to health insurance between 
now and then, as the economy slowly recovers and as state budgets begin 
to heal. During this tough time we need to help individuals, 
businesses, and States, and I am particularly concerned with making 
sure our States have the resources to provide adequate health care.
  Unless Congress acts on FMAP legislation, States will be forced to 
use their limited resources to cover an expanded Medicaid population 
beginning in January 2011. Since States are planning their fiscal year 
2011 budgets, which will begin in July, many Governors are requesting 
Congress act now to provide States with additional Federal support.
  The Transitional FMAP Act would extend the enhanced FMAP funding 
which we passed in the Recovery Act for two additional quarters. This 
extension accounts for the prolonged recession and ensures that the 
pressure of Medicaid needs do not overwhelm the States. The bill would 
also begin a slow decrease of enhanced FMAP funding from July 2011 
through December 2013. This will help States as they recover and ensure 
that States do not experience a gap in assistance prior to health 
reform-related FMAP levels beginning in January 2014.
  Mr. President, this additional funding is important for States, 
businesses, and individuals. I know that Chairman Baucus and Leader 
Reid are well aware of the importance of FMAP and have a history to 
working to aid our States. I look forward to working with them and my 
other colleagues to provide States with necessary additional Federal 
Medicaid assistance.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2833

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Transitional Federal Medical 
     Assistance Percentage Act''.

     SEC. 2. EXTENSION OF ARRA INCREASE IN FMAP.

       Section 5001 of ARRA is amended--
       (1) in subsection (a)(3), by striking ``first calendar 
     quarter'' and inserting ``first 3 calendar quarters'';
       (2) in subsection (b)(2), by inserting before the period at 
     the end the following: ``and such paragraph shall not apply 
     to calendar quarters beginning on or after October 1, 2010'';
       (3) in subsection (d), by inserting ``ending before October 
     1, 2010'' after ``entire fiscal years'' and after ``with 
     respect to fiscal years'';

[[Page S12329]]

       (4) in subsection (g)(1), by striking ``September 30, 
     2011'' and inserting ``December 31, 2011''; and
       (5) in subsection (h)(3), by striking ``December 31, 2010'' 
     and inserting ``June 30, 2011''.

     SEC. 3. ARRA TRANSITIONAL ASSISTANCE PERIOD.

       For each fiscal quarter occurring during the period 
     beginning on July 1, 2011, and ending on December 31, 2013 
     (referred to in this Act as the ``ARRA transitional 
     assistance period''), a State's FMAP shall be equal to the 
     sum of--
       (1) the adjusted base FMAP (as determined under section 
     4(a)(1));
       (2) the general FMAP adjustment (as determined under 
     section 4(a)(2)); and
       (3) the unemployment FMAP adjustment (as determined under 
     section 4(a)(3)).

     SEC. 4. ADJUSTMENTS TO FEDERAL MEDICAL ASSISTANCE PERCENTAGE.

       (a) Determination of Adjusted FMAP.--
       (1) Adjusted base fmap.--
       (A) In general.--Subject to subparagraph (B), the adjusted 
     base FMAP is determined as follows:
       (i) For the fourth quarter of fiscal year 2011, the FMAP 
     that would have applied to the State under section 5001(a) of 
     ARRA (assuming that such section applied) for such fiscal 
     quarter minus 2 percentage points.
       (ii) For any subsequent fiscal quarter occurring during the 
     ARRA transitional assistance period, the FMAP as determined 
     under this paragraph for the preceding fiscal quarter minus 2 
     percentage points.
       (B) Elimination of negative adjustment.--If the adjusted 
     base FMAP applicable to a State under this paragraph for any 
     fiscal quarter occurring during the ARRA transitional 
     assistance period would be less than the FMAP determined for 
     the State for such quarter without regard to this paragraph, 
     this paragraph shall not apply to such State.
       (2) General fmap adjustment.--The general FMAP adjustment 
     shall be equal to the following:
       (A) For the fourth quarter of fiscal year 2011, 5.7 
     percentage points.
       (B) For the first quarter of fiscal year 2012, 4.95 
     percentage points.
       (C) For the second quarter of fiscal year 2012, 3.95 
     percentage points.
       (D) For the third quarter of fiscal year 2012, 2.7 
     percentage points.
       (E) For the fourth quarter of fiscal year 2012, 1.2 
     percentage points.
       (F) For any subsequent fiscal quarter occurring during the 
     ARRA transitional assistance period, 0.2 percentage points.
       (3) Unemployment fmap adjustment.--
       (A) In general.--Subject to subparagraphs (C) and (D), the 
     unemployment FMAP adjustment shall be equal to the increase 
     in the State's FMAP that would have applied to the State 
     under section 5001(c) of ARRA (assuming that such section 
     applied) for such fiscal quarter minus the applicable 
     reduction amount (as described under subparagraph (B)).
       (B) Applicable reduction amount.--For purposes of 
     subparagraph (A), the applicable reduction amount shall be 
     equal to the following:
       (i) For the fourth fiscal quarter of fiscal year 2011, 0.20 
     percentage points.
       (ii) For any subsequent fiscal quarter occurring during the 
     ARRA transitional assistance period, the sum of--

       (I) the applicable reduction amount for the preceding 
     fiscal quarter; and
       (II) 0.05 percentage points.

       (C) Elimination of negative adjustment.--If the 
     unemployment FMAP adjustment applicable to a State under this 
     paragraph for any fiscal quarter during the ARRA transitional 
     assistance period would be less than zero, this paragraph 
     shall not apply to such State.
       (D) Special rule.--
       (i) In general.--For purposes of subparagraph (A), with 
     respect to the computation of the state unemployment increase 
     percentage (as described under section 5001(c)(4) of ARRA) 
     for the last 2 fiscal quarters of the ARRA transitional 
     assistance period, the most recent previous 3-consecutive-
     month period (as described under section 5001(c)(4)(A)(i) of 
     ARRA) shall be the 3-consecutive-month period beginning with 
     December 2012, or, if it results in a higher applicable 
     percent under section 5001(c)(3) of ARRA, the 3-consecutive-
     month period beginning with January 2013.
       (ii) Repeal of special rule under arra for last 2 calendar 
     quarters of the recession adjustment period.--Section 
     5001(c)(4) of ARRA is amended by striking subparagraph (C) 
     and inserting the following:
       ``(C) Special rule.--With respect to the first 2 calendar 
     quarters of the recession adjustment period, the most recent 
     previous 3-consecutive-month period described in subparagraph 
     (A)(i) shall be the 3-consecutive-month period beginning with 
     October 2008.''.
       (b) Scope of Application.--The adjustments in the FMAP for 
     a State under this section shall apply for purposes of title 
     XIX of the Social Security Act and shall not apply with 
     respect to--
       (1) disproportionate share hospital payments described in 
     section 1923 of such Act (42 U.S.C. 1396r-4);
       (2) payments under title IV of such Act (42 U.S.C. 601 et 
     seq.) (except that the increases under paragraphs (1) and (2) 
     of subsection (a) shall apply to payments under part E of 
     title IV of such Act (42 U.S.C. 670 et seq.) and, for 
     purposes of the application of this section to the District 
     of Columbia, payments under such part shall be deemed to be 
     made on the basis of the FMAP applied with respect to such 
     District for purposes of title XIX and as increased under 
     subsection (a)(2));
       (3) any payments under title XXI of such Act (42 U.S.C. 
     1397aa et seq.);
       (4) any payments under title XIX of such Act that are based 
     on the enhanced FMAP described in section 2105(b) of such Act 
     (42 U.S.C. 1397ee(b)); or
       (5) any payments under title XIX of such Act that are 
     attributable to expenditures for medical assistance provided 
     to individuals made eligible under a State plan under title 
     XIX of the Social Security Act (including under any waiver 
     under such title or under section 1115 of such Act (42 U.S.C. 
     1315)) because of income standards (expressed as a percentage 
     of the poverty line) for eligibility for medical assistance 
     that are higher than the income standards (as so expressed) 
     for such eligibility as in effect on July 1, 2008, (including 
     as such standards were proposed to be in effect under a State 
     law enacted but not effective as of such date or a State plan 
     amendment or waiver request under title XIX of such Act that 
     was pending approval on such date).
       (c) State Ineligibility; Limitation; Special Rules.--
       (1) Maintenance of eligibility requirements.--
       (A) In general.--Subject to subparagraph (B) and (C), a 
     State is not eligible for an increase in its FMAP under 
     subsection (a) if eligibility standards, methodologies, or 
     procedures 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)) are more 
     restrictive than the eligibility standards, methodologies, or 
     procedures, respectively, under such plan (or waiver) as in 
     effect on July 1, 2008.
       (B) State reinstatement of eligibility permitted.--Subject 
     to subparagraph (C), a State that has restricted eligibility 
     standards, methodologies, or procedures 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 July 1, 2008, is no longer ineligible 
     under subparagraph (A) beginning with the first calendar 
     quarter in which the State has reinstated eligibility 
     standards, methodologies, or procedures that are no more 
     restrictive than the eligibility standards, methodologies, or 
     procedures, respectively, under such plan (or waiver) as in 
     effect on July 1, 2008.
       (C) Special rules.--A State shall not be ineligible under 
     subparagraph (A)--
       (i) for the fiscal quarters before October 1, 2011, on the 
     basis of a restriction that was applied after July 1, 2008, 
     and before the date of the enactment of this Act, if the 
     State prior to October 1, 2011, has reinstated eligibility 
     standards, methodologies, or procedures that are no more 
     restrictive than the eligibility standards, methodologies, or 
     procedures, respectively, under such plan (or waiver) as in 
     effect on July 1, 2008; or
       (ii) on the basis of a restriction that was directed to be 
     made under State law as in effect on July 1, 2008, and would 
     have been in effect as of such date, but for a delay in the 
     effective date of a waiver under section 1115 of such Act 
     with respect to such restriction.
       (2) Compliance with prompt pay requirements.--
       (A) Application to practitioners.--
       (i) In general.--Subject to the succeeding provisions of 
     this subparagraph, no State shall be eligible for an 
     increased FMAP rate as provided under this section for any 
     claim received by a State from a practitioner subject to the 
     terms of section 1902(a)(37)(A) of the Social Security Act 
     (42 U.S.C. 1396a(a)(37)(A)) for such days during any period 
     in which that State has failed to pay claims in accordance 
     with such section as applied under title XIX of such Act.
       (ii) Reporting requirement.--Each State shall report to the 
     Secretary, on a quarterly basis, its compliance with the 
     requirements of clause (i) as such requirements pertain to 
     claims made for covered services during each month of the 
     preceding quarter.
       (iii) Waiver authority.--The Secretary may waive the 
     application of clause (i) to a State, or the reporting 
     requirement imposed under clause (ii), during any period in 
     which there are exigent circumstances, including natural 
     disasters, that prevent the timely processing of claims or 
     the submission of such a report.
       (iv) Application to claims.--Clauses (i) and (ii) shall 
     only apply to claims made for covered services after the date 
     of enactment of this Act.
       (B) Application to nursing facilities and hospitals.--The 
     provisions of subparagraph (A) shall apply with respect to a 
     nursing facility or hospital, insofar as it is paid under 
     title XIX of the Social Security Act on the basis of 
     submission of claims, in the same or similar manner (but 
     within the same timeframe) as such provisions apply to 
     practitioners described in such subparagraph.
       (3) State's application toward rainy day fund.--A State is 
     not eligible for an increase in its FMAP under paragraphs (2) 
     or (3) of subsection (a) if any amounts attributable 
     (directly or indirectly) to such increase are deposited or 
     credited into any reserve or rainy day fund of the State.
       (4) No waiver authority.--Except as provided in paragraph 
     (2)(A)(iii), the Secretary may not waive the application of 
     this subsection or subsection (d) under section 1115 of the 
     Social Security Act or otherwise.

[[Page S12330]]

       (5) Limitation of fmap to 100 percent.--In no case shall an 
     increase in FMAP under this section result in an FMAP that 
     exceeds 100 percent.
       (d) Requirements.--
       (1) State reports.--Each State that is paid additional 
     Federal funds as a result of this section shall, not later 
     than September 30, 2014, submit a report to the Secretary, in 
     such form and such manner as the Secretary shall determine, 
     regarding how the additional Federal funds were expended.
       (2) Additional requirement for certain states.--In the case 
     of a State that requires political subdivisions within the 
     State to contribute toward the non-Federal share of 
     expenditures under the State Medicaid plan required under 
     section 1902(a)(2) of the Social Security Act (42 U.S.C. 
     1396a(a)(2)), the State is not eligible for an increase in 
     its FMAP under paragraphs (2) or (3) of subsection (a) if it 
     requires that such political subdivisions pay for quarters 
     during the ARRA transitional assistance period a greater 
     percentage of the non-Federal share of such expenditures, or 
     a greater percentage of the non-Federal share of payments 
     under section 1923, than the respective percentage that would 
     have been required by the State under such plan on September 
     30, 2008, prior to application of this section.
       (e) Definitions.--In this Act, except as otherwise 
     provided:
       (1) ARRA.--The term ``ARRA'' means the American Recovery 
     and Reinvestment Act of 2009 (Public Law 111-5; 123 Stat. 
     140).
       (2) 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)), as determined 
     without regard to this section except as otherwise specified.
       (3) Poverty line.--The term ``poverty line'' has the 
     meaning given such term in section 673(2) of the Community 
     Services Block Grant Act (42 U.S.C. 9902(2)), including any 
     revision required by such section.
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.
       (5) State.--The term ``State'' has the meaning given such 
     term in section 1101(a)(1) of the Social Security Act (42 
     U.S.C. 1301(a)(1)) for purposes of title XIX of the Social 
     Security Act (42 U.S.C. 1396 et seq.).
       (f) Sunset.--This section shall not apply to items and 
     services furnished after the end of the ARRA transitional 
     assistance period.
                                 ______