Skip to Content

Notice

Implementation of Section 5001 of the American Recovery and Reinvestment Act of 2009 for Adjustments to the Third and Fourth Quarters of Fiscal Year 2009 Federal Medical Assistance Percentage Rates for Federal Matching Shares for Medicaid and Title IV-E Foster Care, Adoption Assistance and Guardianship Assistance Programs

Document Details

Information about this document as published in the Federal Register.

Published Document

This document has been published in the Federal Register. Use the PDF linked in the document sidebar for the official electronic format.

Start Preamble

AGENCY:

Office of the Secretary, DHHS.

ACTION:

Notice

SUMMARY:

This notice finalizes the methodology for calculating the higher Federal matching funding that is made available under Section 5001 of the American Recovery and Reinvestment Act of 2009 (ARRA), and provides the final calculation of the adjusted Federal Medical Assistance Percentage (FMAP) rates for the third and fourth quarters of Fiscal Year 2009 (FY09). Section 5001 of the ARRA provides for temporary increases in the FMAP rates to provide fiscal relief to States and to protect and maintain State Medicaid and certain other assistance programs in a period of economic downturn. The increased FMAP rates apply during a recession adjustment period that is defined as the period beginning October 1, 2008 and ending December 31, 2010.

DATES:

Effective Date: The percentages listed are for the third quarter of FY09 beginning April 1, 2009 and ending June 30, 2009 and for the fourth quarter of FY09 beginning July 1, 2009 and ending September 30, 2009.

A. Background

The FMAP is used to determine the amount of Federal matching for specified State expenditures for assistance payments under programs under the Social Security Act. Sections 1905(b) and 1101(a)(8)(B) of the Social Security Act (“the Act”) require the Secretary of Health and Human Services Start Printed Page 64698to publish the FMAP rates each year. The Secretary calculates the percentages using formulas set forth in sections 1905(b) and 1101(a)(8)(B), and from the Department of Commerce's statistics of average income per person in each State and for the nation as a whole. The percentages must be within the upper and lower limits given in section 1905(b) of the Act. The percentages to be applied to the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Northern Mariana Islands are specified separately in the Act, and thus are not based on the statutory formula that determines the percentages for the 50 States.

Section 1905(b) of the Act specifies the formula for calculating FMAP as follows:

The FMAP for any State shall be 100 per centum less the State percentage; and the State percentage shall be that percentage which bears the same ratio to 45 per centum as the square of the per capita income of such State bears to the square of the per capita income of the continental United States (including Alaska) and Hawaii; except that (1) the FMAP shall in no case be less than 50 per centum or more than 83 per centum, and (2) the FMAP for Puerto Rico, the Virgin Islands, Guam, the Northern Mariana Islands, and American Samoa shall be 50 per centum.

Section 4725 of the Balanced Budget Act of 1997 amended section 1905(b) to provide that the FMAP for the District of Columbia for purposes of titles XIX (Medicaid) and XXI (CHIP) shall be 70 percent. The Medicare Improvements for Patients and Providers Act of 2008 (Pub. L. 110-275) amended the FMAP applied to the District of Columbia for maintenance payments under title IV-E programs to make it consistent with the 70 percent Medicaid match rate.

Section 5001 of Division B of the ARRA provides for a temporary increase in FMAP rates for Medicaid and title IV-E Foster Care, Adoption Assistance and Guardianship Assistance programs. The purposes of the increases to the FMAP rates are to provide fiscal relief to States and to protect and maintain State Medicaid and certain other assistance programs in a period of economic downturn, referred to as the “recession adjustment period.” The recession adjustment period is defined as the period beginning October 1, 2008 and ending December 31, 2010.

On August 4, 2009, we published a notice with a comment period that described the methodology for calculating the increased Federal matching funding made available under ARRA. (74 FR 38630.) In this issuance, we consider the single comment we received on that prior notice, and set forth the final methodology and FMAP rates for the third and fourth quarters of Federal fiscal year 2009.

B. Calculation of the Increased FMAP Rates Under ARRA

Section 5001 of the ARRA specifies that the FMAP rates shall be temporarily increased for the following: (1) Maintenance of FMAP rates for FY09, FY10, and first quarter of FY11, so that the FMAP rate will not decrease from the prior year, determined by using as the FMAP rate for the current year the greater of any prior fiscal year FMAP rates between 2008-2010 or the rate calculated for the current fiscal year; (2) in addition to any maintenance increase, the application of an increase in each State's FMAP of 6.2 percentage points; and (3) an additional percentage point increase based on the State's increase in unemployment during the recession adjustment period. The resulting increased FMAP cannot exceed 100 percent. Each State's FMAP will be recalculated each fiscal quarter beginning October 2008. Availability of certain components of the increased FMAP is conditioned on States meeting statutory programmatic requirements, such as the maintenance of effort requirement, which are not part of the calculation process.

Expenditures for which the increased FMAP is not available under title XIX include expenditures for disproportionate share hospital payments, certain eligibility expansions, services received through an IHS or Tribal facility (which are already paid at a rate of 100 percent and therefore not subject to increase), and expenditures that are paid at an enhanced FMAP rate. The increased FMAP is available for expenditures under part E of title IV (including Foster Care, Adoption Assistance and Guardianship Assistance programs) only to the extent of a maintenance increase (hold harmless), if any, and the 6.2 percentage point increase. The increased FMAP does not apply to part D of title IV-E (Child Support Enforcement Program).

For title XIX purposes only, for each qualifying State with an unemployment rate that has increased at a rate above the statutory threshold percentage, ARRA provides additional relief above the general 6.2 percentage point increase in FMAP through application of a separate increase calculation. For those States, the FMAP for each qualifying State is increased by the number of percentage points equal to the product of the State matching percentage (as calculated under section 1905(b) and adjusted if necessary for the maintenance of FMAP without reduction from the prior year, and after applying half of the 6.2 percentage point general increase in the Federal percentage) and the applicable percent determined from the State unemployment increase percentage for the quarter.

The unemployment increase percentage for a calendar quarter is equal to the number of percentage points (if any) by which the average monthly unemployment rate for the State in the most recent previous 3-consecutive-month period for which data are available exceeds the lowest average monthly unemployment rate for the State for any 3-consecutive-month period beginning on or after January 1, 2006. A State qualifies for additional relief based on an increase in unemployment if that State's unemployment increase percentage is at least 1.5 percentage points.

The applicable percent is: (1) 5.5 percent if the State unemployment increase percentage is at least 1.5 percentage points but less than 2.5 percentage points; (2) 8.5 percent if the State unemployment increase percentage is at least 2.5 percentage points but less than 3.5 percentage points; and (3) 11.5 percent if the State unemployment increase percentage is at least 3.5 percentage points.

If the State's applicable percent is less than the applicable percent for the preceding quarter, then the higher applicable percent shall continue in effect for any calendar quarter beginning on January 1, 2009 and ending before July 1, 2010.

Puerto Rico, the Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands, and America Samoa can make a one-time election between (1) a 30 percent increase in their cap on Medicaid payments (as determined under subsections (f) and (g) of section 1108 of the Social Security Act), or (2) applying the increase of 6.2 percentage points in the FMAP plus a 15 percent increase in the cap on Medicaid payments. There is no quarterly unemployment adjustment for Territories. As a result, we are not addressing the Territories or Commonwealth in this document, and will instead work with them separately and individually.

C. Response to Public Comments on Methodology

Only one comment was received in response to the request for public comments on the methodology set forth in the August 4, 2009 Notice. The commenter supported the methodology set forth in the August 4, 2009 Notice for the calculation of the ARRA increased FMAP. In light of the absence Start Printed Page 64699of any issues raised through public comment, the methodology for calculating the adjusted FMAPs will remain as it was set forth in the August 4, 2009 Notice.

D. Adjusted FMAPs for the Third and Fourth Quarters of 2009

ARRA adjustments to FMAPs are shown by State in the accompanying table. The hold harmless FY09 FMAP is the higher of the original FY08 or FY09 FMAP. The 6.2 percentage point increase is added to the hold harmless FY09 FMAP. The unemployment tier is determined by comparing the average unemployment rate for the three consecutive months preceding the start of each fiscal quarter to the lowest consecutive 3-month average unemployment rate beginning January 1, 2006. The unemployment adjustment is calculated according to the unemployment tier and added to the hold harmless FY09 FMAP with the 6.2 percentage point increase.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

Carrie Shelton or Thomas Musco, Office of Health Policy, Office of the Assistant Secretary for Planning and Evaluation, Room 447D—Hubert H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 20201, (202) 690-6870.

(Catalog of Federal Domestic Assistance Program Nos. 93.558: TANF Contingency Funds; 93.563: Child Support Enforcement; 93-596: Child Care Mandatory and Matching Funds of the Child Care and Development Fund; 93.658: Foster Care; 93.659: Adoption Assistance; 93.090: Guardianship Assistance; 93.769: Ticket-to-Work and Work Incentives Improvement Act)

Start Signature

Dated: November 20, 2009.

Kathleen Sebelius,

Secretary.

End Signature

ARRA Adjustments to FMAP Q3 & Q4 FY09

StateFY08 original FMAPFY09 original FMAPHold harmless FY09Hold harmless FY09 FMAP with 6.2%pt increase1st & 2nd Quarter FY09 FMAP unemployment adjustment3rd Quarter FY09 FMAP unemployment adjustment3-month average unemployment ending June 2009Minimum unemploymentUnemployment differenceUnemployment tierUnemployment adjustment Q4 FY094th Quarter FY09 FMAP unemployment adjustment
Alabama67.6267.9867.9874.1876.6477.519.63.36.311.53.3377.51
Alaska52.4850.5352.4858.6858.6861.128.26.02.25.52.4461.12
Arizona66.2065.7766.2072.4075.0175.938.23.64.611.53.5375.93
Arkansas72.9472.8172.9479.1479.1480.466.94.82.15.51.3280.46
California50.0050.0050.0056.2061.5961.5911.44.86.611.55.3961.59
Colorado50.0050.0050.0056.2058.7861.597.53.63.911.55.3961.59
Connecticut50.0050.0050.0056.2060.1960.197.84.33.511.55.3961.59
Delaware50.0050.0050.0056.2060.1961.598.03.34.711.55.3961.59
District of Columbia70.0070.0070.0076.2077.6879.2910.55.45.111.53.0979.29
Florida56.8355.4056.8363.0367.6467.6410.23.36.911.54.6167.64
Georgia63.1064.4964.4970.6973.4474.429.64.35.311.53.7374.42
Hawaii56.5055.1156.5062.7066.1367.357.22.25.011.54.6567.35
Idaho69.8769.7769.8776.0778.3779.187.72.84.911.53.1179.18
Illinois50.0050.3250.3256.5260.4861.889.94.45.511.55.3661.88
Indiana62.6964.2664.2670.4673.2374.2110.44.46.011.53.7574.21
Iowa61.7362.6262.6268.8268.8268.825.63.71.95.51.8970.71
Kansas59.4360.0860.0866.2866.2868.316.84.02.88.53.1369.41
Kentucky69.7870.1370.1376.3377.8079.4110.55.45.111.53.0879.41
Louisiana72.4771.3172.4778.6780.0180.016.53.53.08.52.0880.75
Maine63.3164.4164.4170.6172.4074.358.34.43.911.53.7474.35
Maryland50.0050.0050.0056.2058.7860.197.13.43.711.55.3961.59
Massachusetts50.0050.0050.0056.2058.7860.198.34.43.911.55.3961.59
Michigan58.1060.2760.2766.4769.5870.6814.16.77.411.54.2170.68
Minnesota50.0050.0050.0056.2060.1961.598.23.94.311.55.3961.59
Mississippi76.2975.8476.2982.4983.6284.249.36.03.38.51.7584.24
Missouri62.4263.1963.1969.3971.2473.278.84.74.111.53.8873.27
Montana68.5368.0468.5374.7376.2977.146.23.23.08.52.4177.14
Nebraska58.0259.5459.5465.7465.7467.794.82.82.05.52.0567.79
Nevada52.6450.0052.6458.8463.9363.9311.34.27.111.55.0963.93
New Hampshire50.0050.0050.0056.2056.2058.786.63.43.28.53.9960.19
New Jersey50.0050.0050.0056.2058.7861.598.84.24.611.55.3961.59
New Mexico71.0470.8871.0477.2477.2478.666.43.52.98.52.2079.44
New York50.0050.0050.0056.2058.7860.198.24.33.911.55.3961.59
North Carolina64.0564.6064.6070.8073.5574.5110.94.56.411.53.7174.51
North Dakota63.7563.1563.7569.9569.9569.954.23.01.200.0069.95
Ohio60.7962.1462.1468.3470.2572.3410.75.35.411.54.0072.34
Oklahoma67.1065.9067.1073.3074.9474.946.33.33.08.52.5375.83
Oregon60.8662.4562.4568.6571.5872.6112.05.07.011.53.9672.61
Pennsylvania54.0854.5254.5260.7263.0564.328.14.33.811.54.8765.59
Rhode Island52.5152.5952.5958.7963.8963.8911.94.87.111.55.1063.89
South Carolina69.7970.0770.0776.2778.5579.3611.85.56.311.53.0979.36
South Dakota60.0362.5562.5568.7568.7570.645.02.72.35.51.8970.64
Tennessee63.7164.2864.2870.4873.2574.2310.54.56.011.53.7574.23
Texas60.5659.4460.5666.7668.7668.767.14.42.78.53.0969.85
Utah71.6370.7171.6377.8377.8379.985.42.52.98.52.1579.98
Vermont59.0359.4559.4565.6567.7169.967.33.53.811.54.3169.96
Virginia50.0050.0050.0056.2058.7861.597.02.84.211.55.3961.59
Washington51.5250.9451.5257.7260.2262.949.14.44.711.55.2262.94
West Virginia74.2573.7374.2580.4580.4581.708.44.24.211.52.6083.05
Wisconsin57.6259.3859.3865.5865.5868.778.84.44.411.54.3169.89
Wyoming50.0050.0050.0056.2056.2056.205.22.82.45.52.5858.78
Start Printed Page 64700 End Further Info End Preamble

[FR Doc. E9-29248 Filed 12-7-09; 8:45 am]

BILLING CODE 4210-01-P