.

Medicaid’s Federal Medical Assistance
Percentage (FMAP), FY2016
Alison Mitchell
Analyst in Health Care Financing
January 5, 2015
Congressional Research Service
7-5700
www.crs.gov
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Medicaid’s Federal Medical Assistance Percentage (FMAP), FY2016

Summary
Medicaid is a means-tested entitlement program that finances the delivery of primary and acute
medical services as well as long-term services and supports. Medicaid is jointly funded by the
federal government and the states. The federal government’s share of most Medicaid expenditures
is called the federal medical assistance percentage (FMAP) rate. The remainder is referred to as
the nonfederal share, or state share.
Generally determined annually, the FMAP formula is designed so that the federal government
pays a larger portion of Medicaid costs in states with lower per capita incomes relative to the
national average (and vice versa for states with higher per capita incomes). FMAP rates have a
statutory minimum of 50% and a statutory maximum of 83%. For FY2016, regular FMAP rates
range from 50.00% to 74.17%. The FMAP rate is used to reimburse states for the federal share of
most Medicaid expenditures, but exceptions to the regular FMAP rate have been made for certain
states, situations, populations, providers, and services.
Some recent issues related to FMAP include changes to the federal matching rate in the Patient
Protection and Affordable Care Act (ACA, P.L. 111-148 as amended) and the disaster-related
FMAP adjustment.
The ACA contains a number of provisions affecting FMAP rates. Most notably, the ACA provides
initial federal matching rates of up to 100% for certain “newly eligible” individuals. Also, under
the ACA, “expansion states” receive an enhanced federal matching rate for certain individuals. In
addition, ACA provided increased federal matching rates for certain disaster-affected states,
primary care payment rate increases, specified preventive services and immunizations, smoking
cessation services for pregnant women, specified home and community-based services, health
home services for certain people with chronic conditions, home and community-based attendant
services and supports, and state balancing incentive payments.
The ACA included a provision providing a disaster-recovery FMAP adjustment for states that
have experienced a major, statewide disaster. Louisiana is the only state that was eligible for the
disaster-recovery adjusted FMAP from the fourth quarter of FY2011 (when the adjustment was
first available) through FY2014. No state met the requirements for the disaster-recovery FMAP
adjustment in FY2015 and FY2016.
This report describes the FMAP calculation used to reimburse states for most Medicaid
expenditures, and it lists the statutory exceptions to the regular FMAP rate. In addition, this report
discusses other FMAP-related issues, including federal matching rate changes in ACA and the
disaster-recovery FMAP adjustment.

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Medicaid’s Federal Medical Assistance Percentage (FMAP), FY2016

Contents
Introduction ...................................................................................................................................... 1
The Federal Medical Assistance Percentage .................................................................................... 1
How FMAP Rates Are Calculated ............................................................................................. 2
Data Used to Calculate State FMAP Rates ................................................................................ 2
Factors that Affect FMAP Rates ................................................................................................ 3
FY2016 Regular FMAP Rates ................................................................................................... 4
FMAP Exceptions ...................................................................................................................... 7
Recent Issues ................................................................................................................................. 11
FMAP Changes in the ACA .................................................................................................... 11
Disaster-Recovery Adjusted FMAP Rate ................................................................................ 12
Conclusion ..................................................................................................................................... 15

Figures
Figure 1. State Distribution of Regular FMAP Rates ...................................................................... 5
Figure 2. FMAP Rate Changes for States from FY2015 to FY2016 ............................................... 6

Tables
Table 1. Current Exceptions to the Regular FMAP Rates for Medicaid .......................................... 7
Table 2. Calculation for Louisiana’s Disaster-Recovery Adjusted FMAP Rate ............................ 13
Table A-1. Regular FMAP Rates, by State, FY2011-FY2016 ....................................................... 16
Table B-1. Past Exceptions to the Regular FMAP Rates for Medicaid ......................................... 19

Appendixes
Appendix A. FMAP Rates for Medicaid, by State ......................................................................... 16
Appendix B. Past FMAP Rate Exceptions..................................................................................... 19

Contacts
Author Contact Information........................................................................................................... 20
Acknowledgments ......................................................................................................................... 20

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Medicaid’s Federal Medical Assistance Percentage (FMAP), FY2016

Introduction
Medicaid is a means-tested entitlement program that finances the delivery of primary and acute
medical services as well as long-term services and supports.1 Medicaid is jointly funded by the
federal government and the states. Participation in Medicaid is voluntary for states, though all
states, the District of Columbia, and the territories choose to participate. Each state designs and
administers its own version of Medicaid under broad federal rules. While states that choose to
participate in Medicaid must comply with all federal mandated requirements, state variability is
the rule rather than the exception in terms of eligibility levels, covered services, and how those
services are reimbursed and delivered. The federal government pays a share of each state’s
Medicaid costs; states must contribute the remaining portion in order to qualify for federal funds.2
This report describes the federal medical assistance percentage (FMAP) calculation used to
reimburse states for most Medicaid expenditures, and it lists the statutory exceptions to the
regular FMAP rate. In addition, this report discusses other FMAP-related issues, including federal
matching rate changes in the Patient Protection and Affordable Care Act (ACA, P.L. 111-148 as
amended) and the disaster-recovery FMAP adjustment.
The Federal Medical Assistance Percentage
The federal government’s share of most Medicaid service costs is determined by the FMAP rate,
which varies by state and is determined by a formula set in statute. The FMAP rate is used to
reimburse states for the federal share of most Medicaid expenditures, but exceptions to the
regular FMAP rate have been made for certain states, situations, populations, providers, and
services.3
The FMAP rate is also used in determining the phased-down state contribution (“clawback”) for
Medicare Part D, the federal share of certain child support enforcement collections, Temporary
Assistance for Needy Families (TANF) contingency funds, a portion of the Child Care and
Development Fund (CCDF), and foster care and adoption assistance under Title IV-E of the
Social Security Act.
An enhanced FMAP (E-FMAP) rate is provided for both services and administration under the
State Children’s Health Insurance Program (CHIP), subject to the availability of funds from a
state’s federal allotment for CHIP. When a state expands its Medicaid program using CHIP funds
(rather than Medicaid funds), the E-FMAP rate applies and is paid out of the state’s federal
allotment. The E-FMAP rate is calculated by reducing the state share under the regular FMAP
rate by 30%.4

1 For more information about the Medicaid program, see CRS Report R43357, Medicaid: An Overview, coordinated by
Alison Mitchell.
2 For a broader overview of financing issues, see CRS Report R42640, Medicaid Financing and Expenditures, by
Alison Mitchell.
3 More detail about the exceptions to the regular FMAP rate is provided under the heading “FMAP Exceptions.”
4 For more information about CHIP, see CRS Report R43627, State Children’s Health Insurance Program: An
Overview, by Evelyne P. Baumrucker and Alison Mitchell.
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How FMAP Rates Are Calculated
The FMAP formula compares each state’s per capita income relative to U.S. per capita income.
The formula provides higher reimbursement to states with lower incomes (with a statutory
maximum of 83%) and lower reimbursement to states with higher incomes (with a statutory
minimum of 50%). The formula5 for a given state is:
FMAPstate = 1 - ((Per capita incomestate)2/(Per capita incomeU.S.)2 * 0.45)
The use of the 0.45 factor in the formula is designed to ensure that a state with per capita income
equal to the U.S. average receives an FMAP rate of 55% (i.e., state share of 45%). In addition, the
formula’s squaring of income provides higher FMAP rates to states with below-average incomes
(and vice versa, subject to the 50% minimum).6
The Department of Health & Human Services (HHS) usually publishes FMAP rates for an
upcoming fiscal year in the Federal Register during the preceding November. This time lag
between announcement and implementation provides an opportunity for states to adjust to FMAP
rate changes.
In the Appendix A to this report, Table A-1 shows regular FMAP rates for each of the 50 states
and the District of Columbia from FY2006-FY2016.
Data Used to Calculate State FMAP Rates
The per capita income amounts used to calculate FMAP rates for a given fiscal year are several
years old by the time the FMAP rates take effect because, as specified in Section 1905(b) of the
Social Security Act, the per capita income amounts used in the FMAP formula are equal to the
average of the three most recent calendar years of data available from the Department of
Commerce. In its FY2016 FMAP calculations, HHS used state per capita personal income data
for 2011, 2012, and 2013 that became available from the Department of Commerce’s Bureau of
Economic Analysis (BEA) in September 2014. The use of a three-year average helps to moderate
fluctuations in a state’s FMAP rate over time.
BEA revises its most recent estimates of state per capita personal income on an annual basis to
incorporate revised and newly available source data on population and income.7 It also undertakes
a comprehensive data revision—reflecting methodological and other changes—every few years
that may result in upward and downward revisions to each of the component parts of personal
income (as defined in BEA’s national income and product accounts, or NIPA). These components
include:

5 Section 1905(b) of the Social Security Act.
6 For example, assume that U.S. per capita income is $40,000. In state A with an above-average per capita income of
$42,000, the FMAP formula produces an FMAP rate of 50.39%; if the formula did not include a squaring of per capita
income, it would instead produce a higher FMAP rate of 52.75%. In state B with a below-average per capita income of
$38,000, the FMAP formula produces an FMAP rate of 59.39%; if the formula did not include a squaring of per capita
income, it would instead produce a lower FMAP rate of 57.25%.
7 Preliminary estimates of state per capita personal income for the latest available calendar year—as well as revised
estimates for the two preceding calendar years—are released in April. Revised estimates for all three years are released
in September.
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• earnings (wages and salaries, employer contributions for employee pension and
insurance funds, and proprietors’ income);
• dividends, interest, and rent; and
• personal current transfer receipts (e.g., government social benefits such as Social
Security, Medicare, Medicaid, state unemployment insurance).8
As a result of these annual and comprehensive revisions, it is often the case that the value of a
state’s per capita personal income for a given year will change over time. For example, the 2011
state per capita personal income data published by BEA in September 2013 (used in the
calculation of FY2013 FMAP rates) differed from the 2011 state per capita personal income data
published in September 2014 (used in the calculation of FY2016 FMAP rates).
It should be noted that the NIPA definition of personal income used by BEA is not the same as the
definition used for personal income tax purposes. Among other differences, NIPA personal
income excludes capital gains (or losses) and includes transfer receipts (e.g., government social
benefits), while income for tax purposes includes capital gains (or losses) and excludes most of
these transfers.
Factors that Affect FMAP Rates
Several factors affect states’ FMAP rates. The first is the nature of the state economy and, to the
extent possible, a state’s ability to respond to economic changes (i.e., downturns or upturns). The
impact on a particular state of a national economic downturn or upturn will be related to the
structure of the state economy and its business sectors. For example, a national decline in
automobile sales, while having an impact on all state economies, will have a larger impact in
states that manufacture automobiles as production is reduced and workers are laid off.
Second, the FMAP formula relies on per capita personal income in relation to the U.S. average
per capita personal income. The national economy is basically the sum of all state economies. As
a result, the national response to an economic change is the sum of the state responses to
economic change. If more states (or larger states) experience an economic decline, the national
economy reflects this decline to some extent. However, the national decline will be lower than
some states’ declines because the total decline has been offset by states with small decreases or
even increases (i.e., states with growing economies). The U.S. per capita personal income,
because of this balancing of positive and negative, has only a small percentage change each year.
Since the FMAP formula compares state changes in per capita personal income (which can have
large changes each year) to the U.S. per capita personal income, this comparison can result in
significant state FMAP rate changes.
In addition to annual revisions of per capita personal income data, comprehensive NIPA revisions
undertaken every four to five years may also influence regular FMAP rates (e.g., because of
changes in the definition of personal income). The impact on FMAP rates will depend on whether
the changes are broad (affecting all states) or more selective (affecting only certain states or
industries).

8 Employer and employee contributions for government social insurance (e.g., Social Security, Medicare,
unemployment insurance) are excluded from personal income, and earnings are counted based on residency (i.e., for
individuals who live in one state and work in another, their income is counted in the state where they reside).
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FY2016 Regular FMAP Rates
Regular FMAP rates for FY2016 (the federal fiscal year that begins on October 1, 2015) were
calculated and published December 2, 2014, in the Federal Register.9 In the Appendix A to this
report, Table A-1 shows regular FMAP rates for each of the 50 states and the District of
Columbia for FY2011 through FY2016. Figure 1 shows the state distribution of regular FMAP
rates for FY2016. Thirteen states will have the statutory minimum FMAP rate of 50.00% (Rhode
Island, Colorado, and Illinois are very close at 50.42%, 50.72%, and 50.89%, respectively), and
Mississippi will have the highest FMAP rate of 74.17%.

9 Department of Health and Human Services, “Federal Financial Participation in State Assistance Expenditures; Federal
Matching Shares for Medicaid, the Children’s Health Insurance Program, and Aid to Needy Aged, Blind, or Disabled
Persons for October 1, 2015 Through September 30, 2016,” 79 Federal Register 71426, December 2, 2014.
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Figure 1. State Distribution of Regular FMAP Rates
FY2016

Source: Department of Health and Human Services, “Federal Financial Participation in State Assistance Expenditures; Federal Matching Shares for Medicaid, the Children's
Health Insurance Program, and Aid to Needy Aged, Blind, or Disabled Persons for October 1, 2015 Through September 30, 2016,” 79 Federal Register 71426, December 2,
2014.
Note: State-by-state FY2016 regular FMAP rates are listed in Table A-1.
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As shown in Figure 2, from FY2015 to FY2016, the regular FMAP rates for 38 states will
change, while the regular FMAP rates for the remaining 13 states (including the District of
Columbia) will remain the same.10
Figure 2. FMAP Rate Changes for States from FY2015 to FY2016


Source: Prepared by CRS using FY2015 and FY2016 regular FMAP rates.
Note: Specific FMAP rate changes for each state are listed in Table A-1.
For most of the states experiencing an FMAP rate change from FY2015 to FY2016, the change
will be less than one percentage point. The regular FMAP rate for 20 states will increase by as
much as one percentage point, and the FMAP rate for 14 states will decrease by as much as one
percentage point.
For states that will experience an FMAP rate change greater than one percentage point from
FY2015 to FY2016, two states will experience an FMAP rate increase of greater than one
percentage point, and two states will experience an FMAP rate decrease of greater than one
percentage point. Hawaii will have the largest FMAP rate increase of 1.75 percentage point
increase with the FMAP rate increasing from 52.23% to 53.98% Nebraska will have the largest
FMAP rate decrease of 2.11 percentage point decrease with the FMAP rate decreasing from
53.27% to 51.16%.
The District of Columbia’s FY2016 FMAP rate was not calculated according to the regular
FMAP formula because the FMAP rate for the District of Columbia has been set in statute at 70%
since 1998 for the purposes of Title XIX and XXI of the Social Security Act. However, for other
purposes, the percentage for the District of Columbia is 50%, unless otherwise specified by law.

10 All the states with no change to their regular FMAP rates from FY2012 to FY2013 receive the statutory minimum
FMAP rate of 50%, and the regular FMAP rate for the District of Columbia is statutorily set at 70%.
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FMAP Exceptions
Although FMAP rates are generally determined by the formula described above, Table 1 lists
current exceptions that have been added to the Medicaid statute and regulations over the years.
Past FMAP exceptions are listed in Table B-1.
Table 1. Current Exceptions to the Regular FMAP Rates for Medicaid
Exception Description Citations
Territories and Certain States
Territories
As of July 1, 2011, FMAP rates for the territories (Puerto
Most recently P.L.
Rico, American Samoa, the Commonwealth of the Northern
111-148, as
Mariana Islands, Guam, and the Virgin Islands) were increased amended by P.L.
from 50% to 55%. Unlike the 50 states and the District of
111-152; SSA
Columbia, the territories are subject to federal spending
§1905(b), 1108(f)
caps. The 55% also applies for purposes of computing the E-
and (g)
FMAP rate for CHIP.
District of
As of FY1998, the District of Columbia’s FMAP rate is set at
P.L. 105-33; SSA
Columbia
70% (without this exception, it would be at the statutory
§1905(b)
minimum of 50%). The 70% also applies for purposes of
computing the E-FMAP rate for CHIP.
Special Situations
Adjustment for
Beginning in CY2011, a disaster-recovery FMAP adjustment is P.L. 111-148, as
disaster
available for states in which (1) during one of the preceding
amended by P.L.
recovery
seven years, the President declared a major disaster under
111-152, P.L. 112-
the Stafford Act and every county in the state warranted at
96 P.L, and 112-
least public assistance under that act and (2) the regular
141; SSA
FMAP rate declines by a specified amount. To trigger the
§1905(aa); 75
adjustment, a state’s regular FMAP rate must be at least
Federal Register
three percentage points less than such state’s last year’s
80501 (December
regular FMAP rate plus (if applicable) any hold harmless
22, 2010)
increase under P.L. 111-5; the adjustment is an FMAP rate
increase equal to 50% of the difference between the two. To
continue receiving the adjustment, the state’s regular FMAP
rate must be at least three percentage points less than last
year’s adjusted FMAP rate; the adjustment is an FMAP rate
increase equal to 25% of the difference between the two.
(Discussed in further detail in “Disaster-Recovery Adjusted
FMAP Rate”..)
Adjustment for
As of FY2006, significantly disproportionate employer
P.L. 111-3 §614; 75
certain
pension and insurance fund contributions will be excluded
Federal Register
employer
from the calculation of Medicaid FMAP rates. This will have
63482 (October
contributions
the effect of reducing certain states’ per capita personal
15, 2010)
income relative to the national average, which in turn could
increase their Medicaid FMAP rates. Any identifiable
employer contributions towards pensions or other employee
insurance funds are considered to be significantly
disproportionate if the increase in the amount of employer
contributions accrued to residents of a state exceeds 25% of
the total increase in personal income in that state for the
year involved. To date, no state has qualified for this
adjustment.
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Exception Description Citations
Certain Populations
“Newly
Since January 1, 2014 states have had the option to expand
P.L. 111-148, as
eligible”
Medicaid coverage to nonelderly, nonpregnant adults at or
amended by P.L.
individuals
below 133% FPL. An increased federal matching rate is
111-152; SSA
enrolled in new provided for services rendered to “newly eligible” individuals
§1905(y)
eligibility group
in this group. The “newly eligible” are defined as those who
through 133%
would not have been eligible for Medicaid in the state as of
FPL
December 1, 2009 or were eligible under a waiver but not
enrolled because of limits or caps on waiver enrollment. The
federal matching rates for “newly eligible” individuals equal:
CY2014-CY2016 = 100%; CY2017 = 95%; CY2018 = 94%;
CY2019 = 93%; CY2020+ = 90%.
“Expansion
Prior to the ACA Medicaid expansion, some states provided
P.L. 111-148, as
state”
health coverage for all low-income individuals using Medicaid
amended by P.L.
individuals
waivers. As a result, these states have few or no individuals
111-152; SSA
enrolled in new who qualify for the “newly eligible” federal matching rate. To
§1905(z)(2)
eligibility group
address this issue, as of CY2014, an increased federal
through 133%
matching rate is available for individuals in “expansion states”
FPL
who were eligible for Medicaid as of March 23, 2010 (P.L.
111-148’s enactment date) in the new eligibility group for
nonelderly, nonpregnant adults at or below 133% FPL.
“Expansion states” are defined as those that, as of March 23,
2010, offered health benefits coverage meeting certain
criteria statewide to parents and nonpregnant childless adults
at least through 100% FPL. The formula used to calculate
“expansion state” federal matching rates is [regular FMAP +
(newly eligible federal matching rate – regular FMAP) *
transition percentage equal to 50% in CY2014, 60% in
CY2015, 70% in CY2016, 80% in CY2017, 90% in CY2018,
and 100% in CY2019+]. Since the formula for the “expansion
state” federal matching rate is based on the regular FMAP
rate, the “expansion state” federal matching rates vary based
on a states’ regular FMAP rates until CY2019, at which point
they will equal the “newly eligible” federal matching rates:
CY2014 = at least 75%; CY2015 = at least 80%; CY2016 = at
least 85%; CY2017 = at least 86%; CY2018 = at least 90%;
CY2019 = 93%; CY2020+ = 90%.
Certain
During CY2014 and CY2015, an FMAP rate increase of 2.2
P.L. 111-148, as
“expansion
percentage points is available for “expansion states” that (1)
amended by P.L.
states”
the Secretary of HHS determines will not receive any federal
111-152; SSA
matching rate increase for “newly eligible” individuals and (2)
§1905(z)(1)
have not been approved to divert Medicaid disproportionate
share hospital funds to pay for the cost of health coverage
under a waiver in effect as of July 2009. The FMAP rate
increase applies to those who are not “newly eligible”
individuals as described in relation to the new eligibility group
for nonelderly, nonpregnant adults at or below 133% FPL.
Vermont is the only state that has been confirmed as meeting
the criteria for the additional FMAP increase for certain
"expansion states."
Certain women For states that opt to cover certain women with breast or
P.L. 106-354, as
with breast or
cervical cancer who do not qualify for Medicaid under a
amended by P.L.
cervical cancer
mandatory eligibility pathway and are otherwise uninsured,
107-121; SSA
expenditures for these women are reimbursed using the E-
§1905(b)
FMAP rate that applies to CHIP.
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Exception Description Citations
Qualifying
States are required to pay Medicare Part B premiums for
P.L. 105-33, most
Individuals
Medicare beneficiaries with income between 120% and 135%
recently extended
program
FPL and limited assets (referred to as “qualifying individuals”), via P.L. 112-240;
up to a specified dollar allotment. They receive 100% federal
SSA §1933(d)
reimbursement for these costs, which are financed at the
federal level by a transfer of funds from Medicare to
Medicaid. This provision has been extended numerous times
and is currently funded through March 31, 2015.
Certain Providers
Indian Health
States receive 100% federal reimbursement for Medicaid
P.L. 94-437; SSA
Service facility
services provided through an Indian Health Service facility.
§1905(b)



Certain Services
Certain
As of CY2013, states that opt to cover—with no cost
P.L. 111-148, as
preventive
sharing—clinical preventive services recommended with a
amended by P.L.
services and
grade of A or B by the United States Preventive Services
111-152; SSA
immunizations
Task Force (USPSTF) and adult immunizations recommended
§1905(b)
by the Advisory Committee on Immunization Practices
(ACIP) receive a one percentage point increase in their
FMAP rate for those services.
Smoking
As of CY2013, states that opt to cover USPSTF preventive
P.L. 111-148, as
cessation for
services and ACIP adult immunizations as noted above also
amended by P.L.
pregnant
receive a one percentage point increase in their FMAP rate
111-152; SSA
women
for smoking cessation services that are mandatory for
§1905(b)
pregnant women.
Family planning
States receive 90% federal reimbursement for family planning
P.L. 92-603; SSA
services and supplies.
§1903(a)(5)
Health homes
As of CY2011, states have an option for providing “health
P.L. 111-148, as
home” and associated services to certain individuals with
amended by P.L.
chronic conditions. They receive 90% federal reimbursement
111-152; SSA
for these services for the first eight quarters that the health
§1945(c)(1)
home option is in effect in the state.
Home and
As of FY2011, states have an option for providing home and
P.L. 111-148, as
community-
community-based attendant services and supports for certain
amended by P.L.
based
individuals at or below 150% FPL, or a higher income level
111-152; SSA
attendant
applicable to those who require an institutional level of care.
§1915(k)(2)
services and
They receive a six percentage point increase in their regular
supports
FMAP rate for these services.
State balancing
During FY2011-FY2015, state balancing incentive payments
P.L. 111-148, as
incentive
are available under certain conditions for states in which less
amended by P.L.
payments
than 50% of Medicaid expenditures for long-term services
111-152, §10202
and supports (LTSS) are non-institutional. Qualifying states
with less than 25% non-institutional LTSS must plan to
achieve a 25% target and can receive a five percentage point
increase in their FMAP rate for non-institutional LTSS; those
with less than 50% must plan to achieve a 50% target and can
receive a two percentage point increase. Federal spending on
these increased FMAP rates is limited to $3 billion during the
period.
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Exception Description Citations
Administrative Activities
Training of
States receive a 75% federal matching rate for costs
SSA
Medical
attributable to compensation or training of skilled
§1903(a)(2)(A)&(B)
Personnel
professional medical personnel, and staff directly supporting
such personnel.
Immigration
States receive 100% federal reimbursement for the cost of
SSA §1903(a)(4)
Verification
implementation and operation of an immigration status
System
verification system.
Fraud Control
States receive 75% federal matching rate for state
SSA §1903(a)(6)
Unit
expenditures related to the operation of a state Medicaid
fraud control unit.
Preadmission
State expenditures attributable to preadmission screening
SSA
Screening
and resident review for individuals with mental illness or
§1903(a)(2)(C)
mental retardation who are admitted to a nursing facility
receive 75% federal matching rate.
Survey and
States receive 75% federal matching rate for state
SSA
Certification
expenditures related to survey and certification of nursing
§1903(a)(2)(D)
facilities.
Managed Care
States receive 75% federal matching rate for state
SSA
Review
expenditures related to performance of medical and
§1903(a)(3)(C)
Activities
utilization review activities or external independent review of
managed care activities.

Claims and
States receive 90% federal matching rate for the design,
SSA
Eligibility
development, or installation of mechanized claims systems
§1903(a)(3)(A) and
Systems
and 75% federal matching rate for operating mechanized
(B); 76 Federal
claims systems. Both federal reimbursement percentages are
Register 21950

subject to certain criteria set by the Secretary of HHS, which
(April 19, 2011)
includes whether the activity is likely to provide more
efficient, economical, and effective administration of claims

processing. CMS published a final rule to amend the
definition of Mechanized Claims Processing and Information
Retrieval systems to include systems used for eligibility
determination, enrollment, and eligibility reporting activities
thereby making the 90% federal matching rate available for
the design, development and installation or enhancement of
eligibility determination systems until December 31, 2015,
and 75% federal matching rate for maintenance and
operations available for such systems beyond that date as
long as certain requirements are met.a
Translation or
Administrative expenditures for translation or interpretation
P.L. 111-3; SSA
Interpretation
services in connection with the “enrollment of, retention of,
§1903(a)(2)(E);
Services
and use of services” under Medicaid receive 75% federal
State Medicaid
matching rate. For CHIP, the increased match is 75%, or the
Director Letter,
state’s E-FMAP rate plus 5 percentage points, whichever is
State Health
higher, and the CHIP increased match is subject to the 10%
Official 10-007,
cap on administrative expenditures. The increased federal
CHIPRA 18, July 1,
matching rate for translation or interpretation services is
2010.
only available for eligible expenditures claimed as
administrative and not expenditures claimed as medical
assistance-related (which receive each state’s regular FMAP
rate).
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Exception Description Citations
General
Remaining state expenditures found necessary for the proper SSA §1903(a)(7)
Administration
and efficient administration of the state plan receive a 50%
federal matching rate.
Source: Congressional Research Service, based on sources noted in the table.
Notes: Unless noted, exceptions do not apply for purposes of computing the E-FMAP rate for CHIP. SSA =
Social Security Act; FPL = federal poverty level; CHIPRA = Children’s Health Insurance Program Reauthorization
Act.
a. In a letter to the American Public Human Services Association and the National Association of Medicaid
Directors from October 28, 2014, CMS stated its intention to issue new regulations that will codify the
availability of the 90% federal matching rate for Medicaid eligibility and enrollment systems on a permanent
basis.
Recent Issues
Some recent issues related to the FMAP rate include FMAP changes in the ACA and the disaster-
related FMAP adjustment.
FMAP Changes in the ACA
The Medicaid provisions in ACA represent the most considerable reform to Medicaid since its
enactment in 1965. The most noteworthy change (which began in 2014)gives states the option to
implement the ACA Medicaid expansion, which expands Medicaid eligibility to all adults under
age 65 with income up to 133% of the federal poverty level (FPL) (effectively 138% of FPL with
5% of FPL income disregard).11 In addition to the ACA Medicaid expansion, the ACA made a
number of programmatic changes to the Medicaid program.12 For instance, the ACA contains a
number of provisions that affect federal matching rates for Medicaid and CHIP discussed below.
ACA Medicaid Expansion. There are three enhanced federal matching rates potentially available
to states that implement the ACA Medicaid expansion: the “newly eligible” federal matching rate,
the “expansion state” federal matching rate, and the additional FMAP increase for certain
“expansion states.”13
Under the “newly eligible” federal matching rate, from 2014 through 2016, states receive a 100%
federal funding for the cost of individuals who are “newly eligible” for Medicaid due to the ACA
Medicaid expansion. This “newly eligible” federal matching rate phases down to 95% in 2017,
94% in 2018, 93% in 2019, and 90% thereafter.

For more information about the ACA Medicaid expansion, see CRS Report R43564, The ACA Medicaid Expansion, by
Alison Mitchell.
12 For more information about the ACA changes to Medicaid, see CRS Report R41210, Medicaid and the State
Children’s Health Insurance Program (CHIP) Provisions in ACA: Summary and Timeline, by Evelyne P. Baumrucker
et al.
13 For more information about these federal matching rates for the ACA Medicaid expansion, see CRS Report R43564,
The ACA Medicaid Expansion, by Alison Mitchell.
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The “expansion state” federal matching rate is available for individuals in “expansion states”
who were eligible for Medicaid on March 23, 2010 and are in the new eligibility group for
nonelderly, nonpregnant adults at or below 133% FPL. The formula14 used to calculate the
“expansion state” federal matching rates is based on a state's regular FMAP rate.
The additional FMAP increase for certain expansion states is an FMAP rate increase of 2.2
percentage points available in CY2014 and CY2015 for “expansion states” that (1) will not
receive the “newly eligible” FMAP rate (i.e., all of the territories) and (2) have not been approved
to divert Medicaid disproportionate share hospital funds to pay for the cost of health coverage
under a waiver in effect as of July 2009 (i.e., all of the territories). The 2.2 percentage point
increase to the FMAP rate is available to match expenditures for all Medicaid enrollees. Vermont
is the only state that has been confirmed as meeting the criteria for the additional FMAP increase
for certain “expansion states.”
Additional Medicaid Changes. As noted in Table 1, ACA also provided—subject to various
requirements—an increased federal matching rate for certain disaster-affected states, primary care
payment rate increases, specified preventive services and immunizations, smoking cessation
services for pregnant women, specified home and community-based services, health home
services for certain people with chronic conditions, home and community-based attendant
services and supports, and state balancing incentive payments.
CHIP. The ACA included a provision to increase the E-FMAP rate by 23 percentage points (not
to exceed 100%) for most CHIP expenditures from FY2016 through FY2019. This would
increase the statutory range of the E-FMAP rate to 88% through 100%. With this 23 percentage
point increase, the federal share of CHIP will be significantly higher, which means states are
expected to spend through their limited federal CHIP funding (i.e., state CHIP allotments) faster
when the enhanced rate takes effect.
It is important to note that the E-FMAP rate is supposed to increase by 23 percentage points in
FY2016 even though FY2015 is the last year federal CHIP funding is provided under current law.
Since CHIP allotment funding is available to states for two years, under current law, there are
expected to be federal CHIP outlays in FY2016 because states will have access to unspent funds
from their FY2015 allotments and unspent FY2014 allotments redistributed to shortfall states (if
any). However, federal CHIP funding is not expected to be sufficient to cover the federal share of
states' CHIP programs for the entire year, especially with the 23 percentage point increase in the
E-FMAP.15
Disaster-Recovery Adjusted FMAP Rate
The ACA added a disaster-recovery FMAP adjustment for states that have experienced a major,
statewide disaster. This adjustment was available to states beginning the fourth quarter of
FY2011.16

14 Expansion state FMAP formula = [regular FMAP + (newly eligible FMAP – regular FMAP) * transition percentage
equal to 50% in CY2014, 60% in CY2015, 70% in CY2016, 80% in CY2017, 90% in CY2018, and 100% in
CY2019+].
15 For more information about CHIP financing, see CRS Report R43627, State Children’s Health Insurance Program:
An Overview, by Evelyne P. Baumrucker and Alison Mitchell.
16 Initially, the disaster-recovery FMAP adjustment was supposed to be available beginning January 1, 2011. However,
(continued...)
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There are two criteria for states to qualify for the disaster-recovery FMAP adjustment. First,
during the preceding seven years, the President must have declared a major disaster under the
Stafford Act in the state where every county in the state was eligible for public assistance from
the federal government. Second, the state’s regular FMAP rate must have declined at least three
percentage points from the prior year’s FMAP rate.17
In the first year a state qualifies for the disaster-recovery adjusted FMAP rate, the FMAP rate
shall be equal to the regular FMAP rate as determined for the fiscal year, plus 50% of the
difference between the current year’s regular FMAP rate and the preceding year’s FMAP rate. For
the second and subsequent years a state qualifies for the adjustment, the FMAP rate shall be equal
to the state’s regular FMAP rate for that year plus 25% of the difference between the current
year’s regular FMAP rate and the preceding year’s disaster-recovery adjusted FMAP rate.
Originally (i.e., as enacted by the ACA), for the second and subsequent years, the FMAP increase
was applied to the prior year’s disaster-recovery adjusted FMAP. However, this caused the state’s
FMAP rate to increase, rather than phase down as intended, each year a state qualifies for the
adjustment. As a result, Section 3204 of the Middle Class Tax Relief and Job Creation Act of
2012 (P.L. 112-96) revised the formula so that for the second and subsequent years the increase
will be applied to the regular FMAP as determined for the fiscal year. This provision had an
effective date of October 1, 2013. The effective date was later amended by Section 100123 of the
Moving Ahead for Progress in the 21st Century Act (MAP-21, P.L. 112-141) to October 1, 2012.
In addition, MAP-21 amended the formula for FY2013 by changing the adjustment factor from
25% to 50% for only FY2013.
Louisiana was the only state that met both requirements for FY2011, FY2012, FY2013, and
FY2014, and no state met the requirements for the disaster-recovery adjusted FMAP for FY2015
and FY2016.18 Table 2 shows the calculation for Louisiana’s disaster-recovery adjusted FMAP
rate for FY2011 through FY2014.
Table 2. Calculation for Louisiana’s Disaster-Recovery Adjusted FMAP Rate
FY2011 to FY2014
First Year of Disaster-Recovery Adjustment

Regular
Difference
Disaster-Recovery
Disaster-Recovery
FMAP
Prior Year FMAP
Rate
in FMAP
Adjustment
Adjusted FMAP
a
Rate
Rate
Increase
Rate

(...continued)
the disaster-recovery adjusted FMAP rate was not available until the fourth quarter of FY2011 due to the six month
extension of the temporary FMAP rate increases provided through the American Recovery and Reinvestment Act of
2009 (P.L. 111-5) and extended by P.L. 111-226.
17 To meet this criterion in the first year, a state’s regular FMAP rate must have declined at least three percentage points
relative to their regular FMAP rate from the preceding year. To meet this criterion in the second and subsequent years,
a state’s regular FMAP rate must have declined at least three percentage points relative to the preceding year’s disaster-
recovery adjusted FMAP rate.
18 Department of Health and Human Services, “Federal Financial Participation in State Assistance Expenditures;
Federal Matching Shares for Medicaid, the Children's Health Insurance Program, and Aid to Needy Aged, Blind, or
Disabled Persons for October 1, 2015 Through September 30, 2016,” 79 Federal Register 71426, December 2, 2014;
Department of Health and Human Services, “Federal Financial Participation in State Assistance Expenditures; Federal
Matching Shares for Medicaid, the Children's Health Insurance Program, and Aid to Needy Aged, Blind, or Disabled
Persons for October 1, 2014 Through September 30, 2015,” 79 Federal Register 71426, January 21, 2014.
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A
B
C = B - A
D = 50% × C
E = A + D
FY2011b
63.61
72.47
8.86
4.43
68.04






Second and Subsequent Years of Disaster-Recovery Adjustment Prior to P.L. 112-96

Prior Year
Regular
Disaster-Recovery
Difference
Disaster-Recovery
Disaster-Recovery
FMAP
Adjusted FMAP
in FMAP
Adjustment
Adjusted FMAP
Rate
Rate
Rate
Increase
Rate

A
B
C = B - A
D = 25% × C
E = B + D
FY2012 61.09
68.04
6.95 1.74
69.78






Special Formula for FY2013

Regular
Prior Year
Difference
Disaster-Recovery
Disaster-Recovery
FMAP
Disaster-Recovery
in FMAP
Adjustment
Adjusted FMAP
Rate
Adjusted FMAP
Rate
Increase
Rate
Rate

A
B
C = B - A
D = 50% × Cc
E = A + Dd
FY2013 61.24
69.78
8.54 4.27
65.51






Second and Subsequent Years of Disaster-Recovery Adjustment After to P.L. 112-96

Prior Year
Regular
Disaster-Recovery
Difference
Disaster-Recovery
Disaster-Recovery
FMAP
Adjusted FMAP
in FMAP
Adjustment
Adjusted FMAP
Rate
Rate
Rate
Increase
Rate

A
B
C = B - A
D = 25% × C
E = A + Dd
FY2014 60.98 65.51
4.53 1.13
62.11
Source: Office of the Secretary, Department of Health and Human Services, “Adjustments for Disaster-
Recovery States to the Fourth Quarter of Fiscal Year 2011 and Fiscal Year 2012 Federal Medical Assistance
Percentage (FMAP) Rates for Federal Matching Shares for Medicaid and Title IV–E Foster Care, Adoption
Assistance and Guardianship Assistance Programs,” 75 Federal Register 80501; December 22, 2010. Office of the
Secretary, Department of Health and Human Services, “Federal Financial Participation in State Assistance
Expenditures; Federal Matching Shares for Medicaid, the Children’s Health Insurance Program, and Aid to Needy
Aged, Blind, or Disabled Persons for October 1, 2012 Through September 30, 2013,” 76 Federal Register 74061,
November 30, 2011; Office of the Secretary, Department of Health and Human Services, “Federal Financial
Participation in State Assistance Expenditures; Federal Matching Shares for Medicaid, the Children’s Health
Insurance Program, and Aid to Needy Aged, Blind, or Disabled Persons for October 1, 2013 Through September
30, 2014,” 77 Federal Register 71420, November 30, 2012.
a. For FY2011, the preceding fiscal year’s regular FMAP rate includes the application of the “hold harmless”
provision under the ARRA temporary FMAP rate increase.
b. Initially, the disaster-recovery FMAP adjustment was to go into effective on January 1, 2011. However, due
to the extension of the ARRA FMAP adjustments, which extended the recession adjustment period to June
30, 2011 (the end of the third quarter of FY2011), no state qualified for the disaster-recovery adjustment
until the fourth quarter of FY2011.
c. The Moving Ahead for Progress in the 21st Century Act (MAP-21, P.L. 112-141) amended the disaster-
related adjusted FMAP formula for FY2013 by changing the adjustment factor from a 25% to a 50%.
d. The Middle Class Tax Relief and Job Creation Act of 2012 (P.L. 112-96) revised the disaster-recovery
adjustment formula so that for the second and subsequent years the increase will be applied to the regular
FMAP for that year rather than the prior year’s disaster-recovery adjusted FMAP rate. Originally, this
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change had an effective date of October 1, 2013, but the Moving Ahead for Progress in the 21st Century Act
(MAP-21, P.L. 112-141) changed the effective date to October 1, 2012.
In the fourth quarter of FY2011, Louisiana met the Stafford Act criteria (due to Hurricane Katrina
and Hurricane Gustav),19 and its regular FY2011 FMAP rate (63.61%) was at least three
percentage points less than its regular FY2010 FMAP rate plus hold harmless from the American
Recovery and Reinvestment Act of 2009 (P.L. 111-5) temporary FMAP rate increase (72.47%).
As shown in Table 2, Louisiana’s regular FMAP rate was adjusted 4.43 percentage points for a
total FMAP rate of 68.04% for the fourth quarter of FY2011.
For FY2012, Louisiana met the Stafford Act criteria (due to Hurricane Katrina and Hurricane
Gustav), and its regular FY2012 FMAP rate (61.09%) is at least three percentage points less than
its FY2011 disaster-recovery adjusted FMAP rate (68.04%). As shown in Table 2, Louisiana’s
FY2012 disaster-recovery FMAP adjustment is 3.48 percentage points, which was applied to the
FY2011 disaster-recovery adjusted FMAP rate for a total FMAP rate of 69.78%.
For FY2013, Louisiana met the Stafford Act criteria (due to Hurricane Gustav), and Louisiana’s
regular FMAP rate for FY2013 (61.24%) is more than three percentage points lower than
Louisiana’s disaster-recovery adjusted FMAP rate for FY2012 (69.78%). As shown in Table 2,
Louisiana’s FY2013 regular FMAP rate was increased by 4.27 percentage points for a total
FMAP rate of 65.51%.
For FY2014, Louisiana met the Stafford Act criteria (due to Hurricane Gustav), and Louisiana’s
regular FMAP rate for FY2014 (60.98%) is more than three percentage points lower than
Louisiana’s disaster-recovery adjusted FMAP rate for FY2012 (65.51%). As shown in Table 2,
Louisiana’s FY2014 regular FMAP rate was increased by 1.13 percentage points for a total
FMAP rate of 62.11%.
Conclusion
The FMAP rate is used to reimburse states for the federal share of most Medicaid expenditures. In
FY2016, thirteen states will have the statutory minimum FMAP rate of 50%, and Mississippi will
have the highest FMAP rate of 74.17%. From FY2015 to FY2016, the regular FMAP rates for 38
states will change, while the regular FMAP rates for the remaining 13 states (including the
District of Columbia) will remain the same.
Exceptions to the regular FMAP rate have been made for certain states, situations, populations,
providers, and services. The ACA added a number of exceptions to the FMAP for “newly
eligible” individuals, “expansion states,” disaster-affected states, primary care payment rate
increases, specified preventive services and immunizations, smoking cessation services for
pregnant women, specified home and community-based services, health home services for certain
people with chronic conditions, home and community-based attendant services and supports, and
state balancing incentive payments.


19 Hurricane Katrina was declared a major disaster under the Stafford Act on August 29, 2005, and Hurricane Gustav
was declared a statewide disaster on September 2, 2008.
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Appendix A. FMAP Rates for Medicaid, by State
Table A-1 shows regular FY2011-FY2016 FMAP rates calculated according to the formula
described in the text of the report (see “How FMAP Rates Are Calculated”). In FY2016, FMAP
rates range from 50% (13 states) to 74% (Mississippi). From FY2015 to FY2016, regular FMAP
rates will decrease for 16 states, increase for 22 states, and remain the same for 12 states and the
District of Columbia. Most of the states (12 states) for which the FMAP rates do not change have
the statutory minimum FMAP rate of 50%, and the FMAP rate for the District of Columbia is
statutorily set at 70%.
Table A-1. Regular FMAP Rates, by State, FY2011-FY2016
Change
FY2015 to
State FY2011a FY2012 FY2013 FY2014
FY2015
FY2016 FY2016
Alabama 68.54
68.62
68.53
68.12
68.99
69.87
0.88
Alaska 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Arizona 65.85
67.30
65.68
67.23
68.46
68.92
0.46
Arkansas 71.37
70.71
70.17
70.10
70.88
70.00
-0.88
California 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Colorado 50.00
50.00
50.00
50.00
51.01
50.72
-0.29
Connecticut 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Delaware 53.15
54.17
55.67
55.31
53.63
54.83
1.20
District of Columbiab 70.00
70.00
70.00
70.00
70.00
70.00 0.00
Florida 55.45
56.04
58.08
58.79
59.72
60.67
0.95
Georgia 65.33
66.16
65.56
65.93
66.94
67.55
0.61
Hawai 51.79
50.48
51.86
51.85
52.23
53.98
1.75
Idaho 68.85
70.23
71.00
71.64
71.75
71.24
-0.51
Illinois 50.20
50.00
50.00
50.00
50.76
50.89
0.13
Indiana 66.52
66.96
67.16
66.92
66.52
66.60
0.08
Iowa 62.63
60.71
59.59
57.93
55.54
54.91
-0.63
Kansas 59.05
56.91
56.51
56.91
56.63
55.96
-0.67
Kentucky 71.49
71.18
70.55
69.83
69.94
70.32
0.38
Louisianac
63.61/68.04
69.78 65.51 62.11 62.05 62.21
0.16
Maine 63.80
63.27
62.57
61.55
61.88
62.67
0.79
Maryland 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Massachusetts 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Michigan 65.79
66.14
66.39
66.32
65.54
65.60
0.06
Minnesota 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Mississippi 74.73
74.18
73.43
73.05
73.58
74.17
0.59
Missouri 63.29
63.45
61.37
62.03
63.45
63.28
-0.17
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Change
FY2015 to
State FY2011a FY2012 FY2013 FY2014
FY2015
FY2016 FY2016
Montana 66.81
66.11
66.00
66.33
65.90
65.24
-0.66
Nebraska 58.44
56.64
55.76
54.74
53.27
51.16
-2.11
Nevada 51.61
56.20
59.74
63.10
64.36
64.93
0.57
New Hampshire
50.00
50.00
50.00
50.00
50.00
50.00
0.00
New Jersey
50.00
50.00
50.00
50.00
50.00
50.00
0.00
New Mexico
69.78
69.36
69.07
69.20
69.65
70.37
0.72
New York
50.00
50.00
50.00
50.00
50.00
50.00
0.00
North Carolina
64.71
65.28
65.51
65.78
65.88
66.24
0.36
North Dakota
60.35
55.40
52.27
50.00
50.00
50.00
0.00
Ohio 63.69
64.15
63.58
63.02
62.64
62.47
-0.17
Oklahoma 64.94
63.88
64.00
64.02
62.30
60.99
-1.31
Oregon 62.85
62.91
62.44
63.14
64.06
64.38
0.32
Pennsylvania 55.64
55.07
54.28
53.52
51.82
52.01
0.19
Rhode Island
52.97
52.12
51.26
50.11
50.00
50.42
0.42
South Carolina
70.04
70.24
70.43
70.57
70.64
71.08
0.44
South Dakota
61.25
59.13
56.19
53.54
51.64
51.61
-0.03
Tennessee 65.85
66.36
66.13
65.29
64.99
65.05
0.06
Texas 60.56
58.22
59.30
58.69
58.05
57.13
-0.92
Utah 71.13
70.99
69.61
70.34
70.56
70.24
-0.32
Vermont 58.71
57.58
56.04
55.11
54.01
53.90
-0.11
Virginia 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Washington 50.00
50.00
50.00
50.00
50.03
50.00
-0.03
West Virginia
73.24
72.62
72.04
71.09
71.35
71.42
0.07
Wisconsin 60.16
60.53
59.74
59.06
58.27
58.23
-0.04
Wyoming 50.00
50.00
50.00
50.00
50.00
50.00
0.00
Number with increase
17 16 12
14
22
22

from previous year
Number stayed the
same from previous
12 14 15
15
13
13

year
Number with
decrease from
22 21 24
22
16
16

previous year
Source: Department of Health and Human Services, Annual Federal Register Notices.
Notes: Reflects FMAP rates calculated using the regular FMAP formula, with exceptions noted below.
a. FY2009-FY2011 FMAP rates do not reflect temporary increases provided under the American Recovery
and Reinvestment Act of 2009 (P.L. 111-5) as amended by P.L. 111-226. In total, states received the
temporary FMAP increase ran for 11 quarters, from the first quarter of FY2009 through the third quarter of
FY2011 (i.e., October 2008 through June 2011).
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b. Section 4725(b) of the Balanced Budget Act of 1997 amended Section 1905(b) to provide that the FMAP
rate for the District of Columbia shall be set at 70% for purposes of titles XIX and XXI and for capitation
payments and DSH allotments under those titles. For other purposes, the percentage for the District of
Columbia is 50%, unless otherwise specified by law.
c. Louisiana's FMAP rate was higher than the regular FMAP rate from the fourth quarter of FY2011 through
FY2014 due to the disaster-recovery FMAP adjustment. In FY2011, Louisiana's FMAP rate was its regular
FMAP rate of 63.61% for the first three quarters of the year, and the disaster-recovery adjusted FMAP rate
that took effect for the fourth quarter of the year was 68.04%. The table reflects the disaster-recovery
adjusted FMAP rates for FY2012 through FY2014, but the regular FMAP rates for those years would have
been 61.09% for FY2012, 61.24% for FY2013, and 60.98% for FY2014. The disaster-recovery FMAP
adjustment is discussed in the text.
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Appendix B. Past FMAP Rate Exceptions
Although FMAP rates are generally determined by the statutory formula described above, Table 1
lists current exceptions that have been added to the Medicaid statute and regulations over the
years, and Table B-1 lists past FMAP exceptions.
Table B-1. Past Exceptions to the Regular FMAP Rates for Medicaid
Exception Description Citations
Territories and Certain States
Alaska
Alaska’s FMAP rate was set in statute for FY1998-FY2000 at 59.80%;
P.L. 105-33
used an alternative formula for FY2001-FY2005 that reduced the
§4725(a); P.L. 106-
state’s per capita income by 5% (thereby increasing its FMAP rate);
554 Appendix F
and was held at its FY2005 level for FY2006-FY2007. These provisions §706; P.L. 109-171
also applied for purposes of computing the E-FMAP rate for CHIP.
§6053(a)
Special Situations
State fiscal relief,
FMAP rates were increased from the first quarter of FY2009 through
P.L. 111-5 §5001, as
FY2009-FY2011
the third quarter of FY2011, providing states with more than $100
amended by P.L.
billion (about $84 billion for the original provision and $16 billion for a 111-226 §201
six-month extension) in additional funds. Al states received a hold
harmless to prevent any decline in regular FMAP rates and an across-
the-board increase of 6.2 percentage points until the last two quarters
of the period, at which point the across-the-board percentage point
increase phased down to 3.2 and then 1.2; qualifying states received an
additional unemployment-related increase. Each territory could
choose between an FMAP increase of 6.2 percentage points along with
a 15% increase in its spending cap, or its regular FMAP rate along with
a 30% increase in its cap; all chose the latter. States were required to
meet certain requirements in order to receive the increase.
Adjustment for
In computing FMAP rates for any year after 2006 for a state that the
P.L. 109-171; 72
Hurricane Katrina
Secretary of HHS determines has a significant number of Hurricane
Federal Register
Katrina evacuees as of October 1, 2005, the Secretary must disregard
3391 (January 25,
such evacuees and their incomes. Although it was labeled as a “hold
2007) and 44146
harmless for Katrina impact,” the provision language required
(August 7, 2007)
evacuees to be disregarded even if their inclusion would increase a
state’s FMAP rate. Due to lags in the availability of data used to
calculate FMAP rates, FY2008 was the first year to which the
provision applied. HHS proposed and finalized a methodology that
prevented the lowering of any FY2008 FMAP rates and increased the
FY2008 FMAP rate for one state (Texas). The methodology took
advantage of a data timing issue that does not apply after FY2008. HHS
had initial y expressed concern that some states could see lower
FMAP rates in later years as a result of the provision, but the final
methodology indicated that there is no reliable way to track the
number and income of evacuees on an ongoing basis and therefore no
basis for adjusting FMAP rates after FY2008. The provision also
applied for purposes of computing the enhanced FMAP rate for CHIP.
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.
Medicaid’s Federal Medical Assistance Percentage (FMAP), FY2016

Exception Description Citations
State fiscal relief,
FMAP rates for the last two quarters of FY2003 and the first three
P.L. 108-27 §401(a)
FY2003-FY2004
quarters of FY2004 were not allowed to decline (i.e., were held
harmless) and were increased by an additional 2.95 percentage points,
providing states with about $10 bil ion in additional funds (they also
received $10 billion in direct grants). Although Medicaid
disproportionate share hospital (DSH) payments are reimbursed using
the FMAP rate, the increase did not apply to DSH. States had to meet
certain requirements in order to receive an increase (e.g., they could
not restrict eligibility after a specified date).
Certain Providers
Primary care
During CY2013 and CY2014, states were required to provide
P.L. 111-148, as
payment rates
Medicaid payments at or above the Medicare rates for primary care
amended by P.L.
services (defined as evaluation and management and certain
111-152; SSA
administration of immunizations) furnished by a physician with a
§1902(a)(13)(C); 77
primary specialty designation of family, general internal, or pediatric
Federal Register
medicine. States received 100% federal reimbursement for
66670.
expenditures attributable to the amount by which Medicare exceeds
their Medicaid payment rates in effect on July 1, 2009.
Source: Congressional Research Service, based on sources noted in table.


Author Contact Information

Alison Mitchell

Analyst in Health Care Financing
amitchell@crs.loc.gov, 7-0152

Acknowledgments
April Grady, former CRS Specialist in Health Care Financing, authored the original version of this report.
Chris Peterson, former CRS Specialist in Health Care Financing, also contributed to the original version of
this report.

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