Medicaid Accountability and Care Act of 2012

Representative Bill Cassidy (R-LA) recently introduced HR 5979, the Medicaid Accountability and Care Act of 2012. The bill, if enacted would reduce the match states are required to meet under Title XIX. Currently, a state’s Medicaid expenditure consists of a state match and the federal contribution (also known as FMAP). The FMAP is based on criteria such as per capita income, so generally speaking poorer states are required to contribute less than wealthier states. However, under HR 5979, all states would receive an FMAP of 76% (meaning states would be required to contribute less than 25% to for their state portion of the total Medicaid expenditure).

HR 5979 also breaks down the Medicaid population into specific categories, with payments calculated per-capita, per-category (the elderly, blind and disabled, children, and adults). The bill does not explicitly mention how the IV-E population would be paid for under such a structure. While the increased FMAP is appealing on the surface because it reduces the discrepancies between what states are currently required to match, the bill subsequently prohibits states from using provider taxes or intergovernmental transfers to contribute to the state portion of the match. Under HR 5979, the new FAMP structure would be phased in over 10 years, beginning two years after the date of enactment.

Other proposals to address Medicaid reform in this Congress have suggested block granting this entitlement program, but unlike a block grant, the per capita system would continue to allow for increases in Medicaid enrollment during times of economic hardship. Cassidy has acknowledged that it is unlikely that the bill would move this year, but hopes that in the event that Congress considers entitlement reform in the 113th Congress, that the provisions of this bill could be included.

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