Temporary Increase for Quarters in FY 2003 and FY 2004

SUMMARY: The revised Medicaid "Federal Medical Assistance Percentages" (FMAP) for the last 2 calendar quarters of Fiscal Year 2003 and the first 3 calendar quarters of Fiscal Year 2004 have been calculated pursuant to Title IV of the Jobs and Growth Tax Relief Reconciliation Act of 2003. These revised Federal Medical Assistance Percentages replace the percentages previously published for the applicable quarters during Fiscal Year 2003 (Federal Register, November 30, 2001) and Fiscal Year 2004 (Federal Register, November 15, 2002). This notice announces the revised Federal Medical Assistance Percentages that we will use in determining the amount of Federal matching for State medical assistance (Medicaid) expenditures under Title XIX, effective only for the 2 calendar quarters from April 1 through September 30, 2003, and the 3 quarters from October 1, 2003 through June 30, 2004. The table gives figures for each of the 50 States, the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands. Programs under Title XIX of the Act exist in each jurisdiction. The percentages in this notice apply to State expenditures for most medical services only for the last 2 quarters of Fiscal Year 2003 and the first 3 quarters of Fiscal Year 2004.

Federal Medical Assistance Percentages are normally used to determine the amount of Federal matching for State expenditures for assistance payments for certain social services including Temporary Assistance for Needy Families (TANF) Contingency Funds, the federal share of Child Support Enforcement collections, Child Care Mandatory and Matching Funds for the Child Care and Development Fund, Foster Care Title IV-E Maintenance payments, and Adoption Assistance payments, and State medical and medical insurance expenditures for Medicaid and the State Children's Health Insurance Program (SCHIP). However, the temporary increases in the Federal Medical Assistance Percentages under the Jobs and Growth Tax Relief Reconciliation Act of 2003 affect only Medicaid medical expenditure payments under Title XIX. The percentages in this notice do not apply to disproportionate share hospital payments, payments under Title IV or XXI of the Act, or any payments under Title XIX that are based on the enhanced FMAP described in section 2105(b) of such Act. In addition, the statute provides separately for Federal matching of administrative costs, which is not affected by the Jobs and Growth Tax Relief Reconciliation Act of 2003.

Section 401 of the Jobs and Growth Tax Relief Reconciliation Act of 2003 provides for a temporary increase of the Medicaid FMAP. The provisions permit a maintenance of Fiscal Year 2002 FMAP for the last 2 calendar quarters of Fiscal Year 2003 for a State whose 2003 FMAP as calculated pursuant to section 1905(b) of the Act is less than its 2002 FMAP, and a maintenance of Fiscal Year 2003 FMAP for the first 3 calendar quarters of Fiscal Year 2004 for a State whose 2004 FMAP as calculated pursuant to section 1905(b) of the Act is less than its 2003 FMAP. In addition, after adjusting FMAP due to the maintenance of the 2002 or 2003 FMAP where applicable, each State is eligible to receive a 2.95 percentage point increase for each of the last 2 calendar quarters of Fiscal Year 2003 and the first 3 calendar quarters of Fiscal Year 2004.

There are conditions that a State must meet in order to receive the 2.95 percentage point FMAP increase for the last 2 calendar quarters of Fiscal Year 2003 and the first 3 calendar quarters of Fiscal Year 2004. Eligibility under its Medicaid State plan (including any waiver under title XIX of the Social Security Act or under section 1115 of the Act) can be no more restrictive than the eligibility under such plan or waiver as in effect on September 2, 2003. If any State has restricted eligibility under its Medicaid State plan (including any waiver under title XIX of the Social Security Act or under section 1115 of the Act) after September 2, 2003, it will become eligible for the 2.95 percentage point increase in its FMAP in the first calendar quarter (and subsequent calendar quarters) in which the State has reinstated eligibility that is no more restrictive than the eligibility in effect on September 2, 2003. These rules do not affect States' flexibility with respect to benefits offered under their Medicaid State plan (including any waiver under title XIX of the Social Security Act or under section 1115 of the Act).

In addition, in order to receive the 2.95 percentage point FMAP increase, in the case of a State that requires political subdivisions within the State to contribute toward the non-Federal share of expenditures under the State Medicaid plan, the State cannot require that such political subdivisions pay a greater percentage of the non- Federal share of such expenditures for the last 2 calendar quarters of Fiscal Year 2003 and the first 3 calendar quarters of Fiscal Year 2004, than the percentage that was required by the State under such plan on April 1, 2003.

In addition to the increases in FMAP, Title IV of the Jobs and Growth Tax Relief Reconciliation Act of 2003 increases the amounts of Medicaid payments to territories pursuant to section 1108 of the Social Security Act by 5.90 percent of such amounts, for the last 2 calendar quarters of Fiscal Year 2003 and the first 3 calendar quarters of Fiscal Year 2004.

The Jobs and Growth Tax Relief Reconciliation Act of 2003 also provides $10 billion for other temporary state fiscal relief payments based on population. These payments are under the jurisdiction of the Secretary of the Treasury, and are not reflected in the Federal Medical Assistance Percentages.

EFFECTIVE DATES: The percentages listed will be effective only for the last 2 calendar quarters of Fiscal Year 2003 and the first 3 calendar quarters of Fiscal Year 2004.

FOR FURTHER INFORMATION CONTACT: Adelle Simmons or Robert Stewart, Office of Health Policy, Office of the Assistant Secretary for Planning and Evaluation, Hubert H. Humphrey Building, 200 Independence Avenue, SW., Room 442E, Washington, DC 20201, (202) 690-6870.

(Catalog of Federal Domestic Assistance Program No. 93.778: Medical Assistance Program)

Dated: June 12, 2003.
Tommy G. Thompson,
Secretary of Health and Human Services.

Revised Federal Medical Assistance Percentage (Title IV of Jobs and Growth Tax Relief Reconciliation Act of 2003)

[Temporary Increase in Medicaid FMAP for the last 2 Quarters of FY 2003 and First 3 Quarters of FY 2004]

[FR Doc. 03-15274 Filed 6-13-03; 8:45 am]

BILLING CODE 4150-05-P