Obama Signs Bill Providing State Aid for Medicaid

On Tuesday, President Obama signed into law the Education Jobs and Medicaid Assistance Act, (H.R. 1586), (pdf) a bill that will provide $16.1 billion in assistance to states to fund Medicaid payments through the first half of 2011. An additional $10 billion will be allocated to state and local governments to cover teacher salaries. In essence, the bill will extend the temporary increase in the Federal Medical Assistance Percentage (FMAP) through June 2011. According to the White House’s statement of administrative policy, this provision “will provide critical assistance to States to help them maintain their Medicaid programs during a period of high enrollment growth and reduced State revenue.”

After being summoned back to Washington from its summer recess, the House of Representatives passed the bill by a 247-161 margin earlier in the day. The Senate had approved this measure, which was introduced as a substitute amendment (S. A. 4575) to the FAA Air Transportation Modernization and Safety Improvement Act, before it adjourned on Friday for the remainder of August.

In order to offset the cost of this assistance, the legislation will, among other things, provide an exception to the exclusion of certain payment and rebates for inhalation, infusion, instilled, implanted or injectable drugs that are not generally dispensed through retail community pharmacies for purposes of calculating the Medicaid average manufacturer price (AMP). An overview of the bill can be found here.

This entry was written by Ilyse Schuman.