WASHINGTON - Congressman Eliot Engel has urged the House Leadership to include measures that would preserve health care for the poor and uninsured while saving hospitals that are in dire financial condition in the upcoming stimulus package. Engel was joined in his appeal by Congress Members Nita Lowey and Peter King.

In a letter sent to Speaker Nancy Pelosi and Minority Leader John Boehner, the three lawmakers stressed the urgency of the situation considering New York’s tenuous financial standing. 

“Many states such as New York are facing dramatic budget shortfalls and as a result are considering drastic cuts in Medicaid spending to balance their budgets.  Doing so would undermine our health care safety net and will further weaken our state and national economy.  The best way to help the states deal with this crisis is to provide a temporary, but robust increase in the Federal Medicaid Matching Percentage (FMAP).  This was done with great success in 2003-04 and it is desperately needed now to help states limit or avoid any reduction in their Medicaid programs.”

According to Families USA, every dollar of Medicaid spending results in a nearly threefold return for our nation’s economy.  In October, the House passed a $61 billion stimulus plan of public works spending, unemployment benefits, Medicaid help and food stamp assistance for states that was not adopted by the Senate. A similar package will likely be presented in 2009.  Rep. Engel is committed to urging adoption of a similar package with the new 111th Congress – this time with better support from the Senate and support from President-elect Obama. 

The Federal government pays a share of the medical assistance expenditures under each State's Medicaid program. That share, known as the Federal Medical Assistance Percentage, is determined annually by a formula that compares the State's average per capita income level with the national income average. States with a higher per capita income level are reimbursed a smaller share of their costs. By law, the FMAP cannot be lower than 50 percent, or higher than 83 percent.  New York’s share for Fiscal Year 2009 is 50 percent – meaning for every dollar New York spends, the federal government also spends a dollar.