The bipartisan bill to help states deal with the Medicaid funding crisis was offered as an amendment to the Greater Access to Affordable Pharmaceuticals Act (GAAP) to provide fiscal relief to states through an increase in the Federal Medical Assistance Percentage and block grant funds. In the event that the GAAP is not considered by the House of Representatives this year, it is necessary to attach the amendment to another piece of legislation that is likely to pass both the Senate and the House in order for the relief to be made law and thereby applicable.
"In July, I joined with Senators Nelson (D-NE), Rockefeller (D-WV), and Smith (R-OR) to try to help our states through the most severe fiscal crisis since the 1980s and to protect the patients and communities that have to shoulder the burden of dramatic budget cuts," said Senator Collins. "When the Senate overwhelmingly passed our legislation, the message we sent to our Nation's most vulnerable individuals and to our states was clear - we will stand beside you through these difficult times. It is now time for the Senate to make good on its promise."
The amendment provides about $9 billion in total fiscal relief to the states under a reasonable bipartisan approach that would include:
• Temporary Increase in Federal Medicaid Matching Rates. The amendment would provide about $6 billion to states through an increase in the Federal Medical Assistance Percentage (FMAP). $54 million would be allocated to Maine.
• Temporary State Fiscal Relief Grants. The amendment would provide $3 billion to states in fiscal relief grants through Title XX that could be flexibly used for a variety of social services programs. The grants would be available to the states through September 30, 2004 and would constitute a funding stream separate from existing Title XX grants.
"Since July, when I first introduced this legislation, the fiscal situation facing our states has deteriorated further," said Senator Collins. "As they enacted their fiscal year 2003 budgets, states had to address a combined shortfall that exceeded $50 billion. Early fiscal year 2003 data from several states shows that the situation is worsening as revenues continue to come in well below their expected levels. States already have made substantial budget cuts and continue to look at programs like medicaid, education, and child care for low-income working families to balance their budgets. We are well beyond the point where belt-tightening and cutting corners will bring state budgets back into balance. The situation is dire, and we must help."