Medicaid Financing Page: 2 of 7
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Combined federal and state spending on the Medicaid program currently exceeds $300 billion
each year. It is the largest or second-largest item in state budgets, and is second only to Medicare
in terms of federal spending on health care. In 2007, Congress placed temporary moratoriums on
the implementation of four controversial regulations that anticipate large reductions in federal
spending for Medicaid. A war supplemental spending bill enacted in 2008 (P.L. 110-252) further
delayed implementation of these regulations and two others until April 1, 2009. Most recently,
debate has focused on the downturn in the U.S. economy and whether increases in the federal
medical assistance percentage (FMAP, which determines the federal share of most Medicaid
costs) should be included as part of a stimulus package. Stimulus bills containing a temporary
increase failed a motion to proceed in the Senate (S. 3604) and passed the House (H.R. 7110) in
September, and another was introduced in November (S. 3689). Over 10 years, the bills would
increase Medicaid spending by an estimated $19.6 billion, $14.7 billion, and $37.8 billion,
respectively. Additional legislation that would provide a temporary Medicaid FMAP increase was
introduced earlier in 2008 (S. 2586, H.R. 5268, S. 2620, S. 2819).
Congressional Research Service
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Medicaid Financing, report, November 26, 2008; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc806328/m1/2/: accessed February 19, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.