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Pallone Introduces Legislation to Temporarily Increase Medicaid Assistance to States

Press Release

Location: Washington, DC


U.S. Reps. Frank Pallone, Jr. (D-NJ), Chairman of the House Energy and Commerce Subcommittee on Health introduced legislation today that would provide a temporary increase in the Medicaid federal medical assistance percentage (FMAP) so that cash-strapped states like New Jersey can continue to provide health care assistance to its low-income residents. Under this legislation, New Jersey would receive an additional $283 million in federal Medicaid assistance between April 1, 2008 and June 30, 2009.

The bipartisan legislation comes at a time when state leaders are concerned their tax revenues will decline as a result of the economic slump. Such a financial drain would make it more difficult for them to assist residents who are already eligible for Medicaid, much less those that become eligible as victims of the economic downturn.

The New Jersey congressman introduced the bipartisan legislation to provide targeted relief to states by:

· Providing a temporary increase of the Medicaid FMAP by 2.95 percent for five quarters, the last two quarters of fiscal year 2008 and the fist three quarters of fiscal year 2009 (April 1, 2008 through June 30, 2009.);

· Providing a similar temporary increase of the Medicaid FMAP by 5.9 percent for the territories;

· Protecting the states against a decline in their Medicaid FMAP during the same five quarters of the 2008 and 2009 fiscal years;

· Requiring states to maintain their Medicaid eligibility at current levels in order to receive the 2.95 percent temporary increase in the Medicaid FMAP; and

· Requiring states to adjust payments by localities and counties to the state share to account for additional federal funding.

"As the economy continues to slump, New Jersey and other states will have fewer financial resources at their disposal just as more residents will need access to the health care provided through Medicaid," Pallone said. "In past economic downturns, Congress has responded to our state's needs by temporarily increasing Medicaid assistance. I know there is strong support in Congress for a similar proposal this year, and am hopeful that we can pass this legislation quickly so that states can continue to help every family in need of assistance."

Pallone was joined in introducing this legislation today by U.S. Reps. Peter King (R-NY), John Dingell (D-MI), Chairman of the House Energy and Commerce Committee, and Thomas Reynolds (R-NY). Back in 2003, Congress passed and President Bush signed into law an economic stimulus package that included a similar FMAP increase at a cost of $20 billion.

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