An adjustment to the Medicaid Federal Medical Assistance Percentage formula could facilitate state budget planning and provide states with greater fiscal stability, according to a report from the Government Accountability Office (pdf).
The FMAP formula was enacted under the American Recovery and Reinvestment Act of 2009 to provide a temporary increase to the federal share of state Medicaid from Oct. 2008 through Dec. 2010. In March 2011, the GAO reported the states' abilities to fund Medicaid was still hampered, especially as Medicaid enrollment grew and state budgets shrunk.
The GAO's new prototype formula could be a "timely and targeted" option for providing more states Medicaid assistance, according to the report. A temporary increase to all states' FMAPs would be triggered automatically when 26 states show a sustained decrease in their employment-to-population ratio.
Congress could consider enacting this prototype FMAP formula that targets variable state Medicaid needs, and the GAO will update its report when Congress determines what steps need to be taken with federal shares of state Medicaid.
The FMAP formula was enacted under the American Recovery and Reinvestment Act of 2009 to provide a temporary increase to the federal share of state Medicaid from Oct. 2008 through Dec. 2010. In March 2011, the GAO reported the states' abilities to fund Medicaid was still hampered, especially as Medicaid enrollment grew and state budgets shrunk.
The GAO's new prototype formula could be a "timely and targeted" option for providing more states Medicaid assistance, according to the report. A temporary increase to all states' FMAPs would be triggered automatically when 26 states show a sustained decrease in their employment-to-population ratio.
Congress could consider enacting this prototype FMAP formula that targets variable state Medicaid needs, and the GAO will update its report when Congress determines what steps need to be taken with federal shares of state Medicaid.
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