Governors Make the Case for Help with FMAP – Say Ahhh! A Children’s Health Policy Blog

This last weekend, the nation’s Governors
came together for their annual meeting in Boston where the main topic of
conversation was the economic crisis that continues to cripple state
budgets.  One of the key policies
many of the Governors made a pitch for was an extension of fiscal relief for
strapped states through the extension of increased federal support for Medicaid
(aka FMAP) .  As my colleague Joe
Touschner pointed out in a blog last
month: That
extra support has helped states through one of the worst fiscal crises on
record and has been vital in stabilizing Medicaid coverage for children and
others in families facing job loss.”

My colleague Jocelyn Guyer also blogged about this topic earlier this week and I wanted to follow-up her
comments with another look at why the Governors (and many others) think it is
so critical for Congress to act sooner rather than later on an FMAP
extension.  To do that, I pulled
out a brief that
Jocelyn and I, along with our colleague here at CCF, Martha Heberlein, did back
in 2008 when the economic crisis we are currently in, began.

In this brief, we noted the astonishing progress that
states had made over the last decade in covering uninsured children and
explained that that progress was at risk due to the worsening economic climate
facing states and a dramatic increase in the number of uninsured seeking
coverage through Medicaid and CHIP. 
We cited research from the Urban Institute that found that a one
percentage point rise in the national unemployment rate can be expected to
cause the number of uninsured people to grow by 1.1 million and to increase
Medicaid and CHIP enrollment by one million (including 600,000 children and
400,000 non-elderly adults).

At the time, we considered the implications of this study
if the unemployment rate reached 7.5 percent. Today, we face an unemployment
rate of around 9.5 percent- and the model employed two years ago would suggest
that as a result, the number of people that have lost employer-based coverage
is 11.2 million; 4.7 million have likely enrolled in Medicaid or CHIP and about
5.1 million more people have become uninsured.

In the 2008 brief, we outlined key policies that
lawmakers were considering to assist families through this crisis-
reauthorizing CHIP and temporarily increasing the federal funding for Medicaid
through increasing the FMAP.  CHIP
has been reauthorized, the FMAP was increased until the end of this fiscal year
and health care reform was been signed into law. However, the economic crisis
continues and has likely resulted in millions of more people seeking coverage
through Medicaid and CHIP just when the federal commitment to help states
weather this economic storm appears to be eroding. While help is on the horizon
in 2014 when states will receive new federal support through health reform,
states need help now to meet the unprecedented demand for publicly-funded
health care coverage.  It would be
a mistake for the federal government to turn its back on the states before our
nation has clearly pulled itself out of the recession. 

Scroll to Top