Gov. Jennifer Granholm has joined with 41 other governors in asking Congress to extend the increase in federal matching funds for Medicaid that was built in to the American Recovery and Reinvestment Act (ARRA), also known as the stimulus package, that was passed last year.
In a letter addressed to the leadership in the U.S. House and Senate, the bipartisan group of governors asked for the enhanced federal matching funds to be extended for six months to help the states deal with increased demand for Medicaid.
On behalf of the nation’s governors we write to request your assistance in protecting jobs and speeding economic recovery by extending the American Recovery and Reinvestment Act’s (ARRA) enhanced federal match for Medicaid (FMAP) for two additional quarters.
Unfortunately, the length and depth of the recession means states and territories will continue to face significant budget shortfalls long after the enhanced FMAP provisions expire at the end of this calendar year.
States and territories are in the process of finalizing budgets for FY 2011 that our legislatures will be considering over the next several months. Timely passage of an extension of ARRA’s enhanced FMAP would greatly assist us in maintaining services and further stabilizing the economy.
To maximize the positive impact of FMAP enhancements on the economy, Congress should also modify ARRA’s existing maintenance of effort (MOE) provisions. Restoring flexibility to manage our Medicaid programs and enact common sense reforms is critical to ensuring the program’s ongoing and future stability.
Governors appreciated the inclusion of enhanced FMAP provisions in ARRA. We are committed to encouraging job creation and speeding recovery and urge you to work with us by extending FMAP enhancements and restoring state flexibility over Medicaid as soon as possible.
Because of high unemployment over the last couple years, Michigan has 1.8 million residents receiving Medicaid benefits, the highest number in history, and this at a time when state revenue continues to decline year after year. The increased matching funds helped balance the FY 2010 budget last fall, but unless Congress extends that provision there will be no additional funds available for next year’s budget.