Congressman Cao Introduces Bill to Help Solve Louisiana’s Looming Medicaid Funding Crisis

On November 6, 2009, Congressman Anh “Joseph” Cao, joined by Louisiana Congressmen Steve Scalise, Rodney Alexander, Bill Cassidy, and Charles Boustany introduced House Bill 4047 calling for the use of historical average per capita income to calculate the Federal Medical Assistance Percentage for the Medicaid program in states affected by federally declared disasters.

The purpose of the bill is to mitigate the effects of the inflow of federal disaster recovery money on the calculation of per capita income used to determine the level of federal Medicaid matching funds.

Absent relief on this issue, Louisiana and other states hit by large disasters face the loss of hundreds of millions of dollars of federal Medicaid matching funds, resulting in the loss or reduction of critical healthcare programs for low- to moderate-income families.

Below is the language of House Bill 4047:

SECTION 1. FMAP CALCULATION FOR DISASTER-AFFECTED STATES.

(a) In General- With respect to a State, for purposes of calculating the Federal Medical Assistance Percentage for a State under section 1905(b) of the Social Security Act, the Secretary shall substitute the average historical per capita income for such State for a year in any instance for which the Secretary, without regard to this section, would use the per capita income for such State for such year if--

(1) in such year, the per capita income for a State exceeds the average historical per capita income by at least 8 percent; and

(2) during such year or any of the 2 previous years, a major disaster was declared in such State by the President under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.).

(b) Average Historical Per Capita Income Defined- For purposes of this section, the term `average historical per capita income' means, with respect to a State, the average annual per capita income for the period beginning with the first year in which the Federal Medical Assistance Percentage was calculated for such State under section 1905(b) of the Social Security Act and ending with the year prior to the year during which the average historical per capita income is applied under subsection (a).