SEC. 2. EXTENSION OF MORATORIUM ON IMPLEMENTA-
TION OF RULE RELATING TO THE FEDERAL- 
STATE 
FINANCIAL 
PARTNERSHIP 
UNDER 
MEDICAID AND SCHIP AND ON FINALIZATION 
OF A RULE RELATING TO THE TREATMENT 
OF GRADUATE MEDICAL EDUCATION UNDER 
MEDICAID. 
(a) FINDINGS.—Congress makes the following find-
ings: 
(1) A proposed rule was published on January 
18, 2007, on pages 2236 through 2248 of volume 
72, Federal Register, and a rule purporting to final-
ize that rule was published on May 29, 2007, on 
pages 29748 through 29836 of volume 72, Federal 
Register (relating to parts 433, 447, and 457 of title 
42, Code of Federal Regulations). This rule would 
significantly change the Federal-State financial part-
nership under the Medicaid and the State Children’s 
Health Insurance Programs by— 
(A) imposing a cost limit on payments 
made under such programs to governmentally 
operated providers; 
(B) limiting the permissible sources of the 
non-Federal shares required under such pro-
grams and the types of entities permitted to 
contribute to such shares; and 
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(C) imposing new requirements on partici-
pating providers and States under such pro-
grams. 
(2) A proposed rule was published on May 23, 
2007, on pages 28930 through 28936 of volume 72, 
Federal Register (relating to parts 438 and 447 of 
title 42, Code of Federal Regulations) that would 
significantly change the scope of permissible pay-
ments under Medicaid by removing the ability for 
States to make payments related to graduate med-
ical education. 
(3) Permitting these rules to take effect would 
drastically alter the Federal-State financial partner-
ship in Medicaid and the State Children’s Health In-
surance Programs, undermine the discretion tradi-
tionally accorded States, and have a negative impact 
on States, providers, and beneficiaries in the fol-
lowing manner: 
(A) Implementation of the rule regarding 
the Federal-State financial partnership would 
force billions of dollars of payment reductions 
to providers, thus hampering the ability of im-
pacted providers to provide essential services in-
cluding allowing those providers to be ready 
and available for emergency situations and to 
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provide care to the increasing numbers of unin-
sured. 
(B) Implementation of the rule regarding 
graduate medical education would force billions 
of dollars in payment reductions to teaching 
hospitals, thus hampering the ability of those 
providers to provide essential services including 
the education of the next generation of medical 
professionals despite a shortage of medical pro-
fessionals. 
(4) By including a one-year moratorium in the 
U.S. Troop Readiness, Veterans’ Care, Katrina Re-
covery, and Iraq Accountability Appropriations Act 
of 2007, Congress intended to forestall administra-
tive action to allow itself time to assess the proposals 
and consider alternatives that would not negatively 
impact States, providers, and beneficiaries. 
(5) After Congressional approval of the morato-
rium contained in the U.S. Troop Readiness, Vet-
erans’ Care, Katrina Recovery, and Iraq Account-
ability Appropriations Act of 2007, the Centers for 
Medicare & Medicaid Services on May 25, 2007, 
submitted for publication its final rule, which was 
not significantly different from the January pro-
posed regulation. 
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(6) The publication of a final rule in May re-
garding the Federal-State financial partnership was 
not anticipated by Congress and accelerates the neg-
ative impact on States, providers, and beneficiaries, 
thus undermining the intent of the moratorium 
passed by Congress. 
(7) The publication of a proposed rule in May 
regarding graduate medical education was not an-
ticipated by Congress and undermines the intent of 
the moratorium passed by Congress. 
(8) Extension of the moratorium is necessary to 
effectuate Congressional intent. 
(b) 
EXTENSION
OF
PROHIBITION.—Section 
7002(a)(1) of the U.S. Troop Readiness, Veterans’ Care, 
Katrina Recovery, and Iraq Accountability Appropriations 
Act of 2007 (Public Law 110–28), is amended by striking 
‘‘1 year’’ and inserting ‘‘2 years’’. 
Æ 
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