Review of the Calculation of Additional Medicaid Funding Awarded Under the American Recovery and Reinvestment Act

For the first two quarters of fiscal year (FY) 2009, CMS calculated the additional Medicaid funding awarded under the American Recovery and Reinvestment Act (ARRA) in accordance with Federal law. The ARRA provides fiscal relief to States to protect and maintain State Medicaid programs in a period of economic downturn. For the recession adjustment period (October 1, 2008, through December 31, 2010), the ARRA provides approximately $87 billion in additional Medicaid funding based on temporary increases in States' Federal medical assistance percentages (FMAP). For the first two quarters of FY 2009, CMS calculated and made available to States approximately $15.2 billion in additional funding.

To calculate the additional funding for each State and the District of Columbia, CMS used the reported actual or estimated expenditures, deducted the expenditures identified in section 5001(e) of the ARRA (to which the increased FMAPs do not apply) if the State reported the expenditures, and multiplied the remaining expenditures by the correct percentage-point increase in the FMAP. Consequently, this report contains no recommendations.