A bill to provide for an automatic increase in the federal matching rate for the Medicaid program during periods of national economic downturn to help States cope with increases in Medicaid costs.

SECTION 1. AUTOMATIC INCREASE IN THE FEDERAL MEDICAL ASSISTANCE 
              PERCENTAGE DURING PERIODS OF NATIONAL ECONOMIC DOWNTURN.

    (a) National Economic Downturn Assistance FMAP.--
            (1) In general.--Section 1905 of the Social Security Act 
        (42 U.S.C. 1396d) is amended--
                    (A) in subsection (b), in the first sentence--
                            (i) by striking ``and (4)'' and inserting 
                        ``(4)''; and
                            (ii) by inserting ``and (5) with respect to 
                        each fiscal year quarter other than the first 
                        quarter of a national economic downturn 
                        assistance period described in subsection 
                        (y)(1), the Federal medical assistance 
                        percentage for any State described in 
                        subsection (y)(2) shall be equal to the 
                        national economic downturn assistance FMAP 
                        determined for the State for the quarter under 
                        subsection (y)(3)'' before the period; and
                    (B) by adding at the end the following:
    ``(y) National Economic Downturn Assistance FMAP.--For purposes of 
clause (5) of the first sentence of subsection (b):
            ``(1) National economic downturn assistance period.--A 
        national economic downturn assistance period described in this 
        paragraph--
                    ``(A) begins with the first fiscal year quarter for 
                which the Secretary determines that for at least 23 
                States, the rolling average unemployment rate for that 
                quarter has increased by at least 10 percent over the 
                corresponding quarter for the most recent preceding 12-
                month period for which data are available (in this 
                subsection referred to as the `trigger quarter'); and
                    ``(B) ends with the first succeeding fiscal year 
                quarter for which the Secretary determines that less 
                than 23 States have a rolling average unemployment rate 
                for that quarter with an increase of at least 10 
                percent over the corresponding quarter for the most 
                recent preceding 12-month period for which data are 
                available.
            ``(2) Eligible state.--A State described in this paragraph 
        is a State for which the Secretary determines that the rolling 
        average unemployment rate for the State for any quarter 
        occurring during a national economic downturn assistance period 
        described in paragraph (1) has increased over the corresponding 
        quarter for the most recent preceding 12-month period for which 
        data are available.
            ``(3) Determination of national economic downturn 
        assistance fmap.--
                    ``(A) In general.--The national economic downturn 
                assistance FMAP for a fiscal year quarter determined 
                with respect to a State under this paragraph is equal 
                to the Federal medical assistance percentage for the 
                State for that quarter increased by the number of 
                percentage points determined by--
                            ``(i) dividing--
                                    ``(I) the Medicaid additional 
                                unemployed increased cost amount 
                                determined under subparagraph (B) for 
                                the quarter; by
                                    ``(II) the State's total Medicaid 
                                quarterly spending amount determined 
                                under subparagraph (C) for the quarter; 
                                and
                            ``(ii) multiplying the quotient determined 
                        under clause (i) by 100.
                    ``(B) Medicaid additional unemployed increased cost 
                amount.--For purposes of subparagraph (A)(i)(I), the 
                Medicaid additional unemployed increased cost amount 
                determined under this subparagraph with respect to a 
                State and a quarter is the product of the following:
                            ``(i) State increase in rolling average 
                        number of unemployed individuals from the base 
                        quarter of unemployment.--
                                    ``(I) In general.--The amount 
                                determined by subtracting the rolling 
                                average number of unemployed 
                                individuals in the State for the base 
                                unemployment quarter for the State 
                                determined under subclause (II) from 
                                the rolling average number of 
                                unemployed individuals in the State for 
                                the quarter.
                                    ``(II) Base unemployment quarter 
                                defined.--
                                            ``(aa) In general.--For 
                                        purposes of subclause (I), 
                                        except as provided in item 
                                        (bb), the base quarter for a 
                                        State is the quarter with the 
                                        lowest rolling average number 
                                        of unemployed individuals in 
                                        the State in the 12-month 
                                        period preceding the trigger 
                                        quarter for a national economic 
                                        downturn assistance period 
                                        described in paragraph (1).
                                            ``(bb) Exception.--If the 
                                        rolling average number of 
                                        unemployed individuals in a 
                                        State for a quarter occurring 
                                        during a national economic 
                                        downturn assistance period 
                                        described in paragraph (1) is 
                                        less than the rolling average 
                                        number of unemployed 
                                        individuals in the State for 
                                        the base quarter determined 
                                        under item (aa), that quarter 
                                        shall be treated as the base 
                                        quarter for the State for such 
                                        national economic downturn 
                                        assistance period.
                            ``(ii) National average amount of 
                        additional federal medicaid spending per 
                        additional unemployed individual.--In the case 
                        of--
                                    ``(I) a calendar quarter occurring 
                                in fiscal year 2012, $350; and
                                    ``(II) a calendar quarter occurring 
                                in any succeeding fiscal year, the 
                                amount applicable under this clause for 
                                calendar quarters occurring during the 
                                preceding fiscal year, increased by the 
                                annual percentage increase in the 
                                medical care component of the consumer 
                                price index for all urban consumers 
                                (U.S. city average), as rounded up in 
                                an appropriate manner.
                            ``(iii) State nondisabled, nonelderly 
                        adults and children medicaid spending index.--
                                    ``(I) In general.--With respect to 
                                a State, the quotient (not to exceed 
                                1.00) of--
                                            ``(aa) the State 
                                        expenditure per person in 
                                        poverty amount determined under 
                                        subclause (II); divided by--
                                            ``(bb) the National 
                                        expenditure per person in 
                                        poverty amount determined under 
                                        subclause (III).
                                    ``(II) State expenditure per person 
                                in poverty amount.--For purposes of 
                                subclause (I)(aa), the State 
                                expenditure per person in poverty 
                                amount is the quotient of--
                                            ``(aa) the total amount of 
                                        annual expenditures by the 
                                        State for providing medical 
                                        assistance under the State plan 
                                        to nondisabled, nonelderly 
                                        adults and children; divided by
                                            ``(bb) the total number of 
                                        nonelderly adults and children 
                                        in poverty who reside in the 
                                        State, as determined under 
                                        paragraph (4)(A).
                                    ``(III) National expenditure per 
                                person in poverty amount.--For purposes 
                                of subclause (I)(bb), the National 
                                expenditure per person in poverty 
                                amount is the quotient of--
                                            ``(aa) the sum of the total 
                                        amounts determined under 
                                        subclause (II)(aa) for all 
                                        States; divided by
                                            ``(bb) the sum of the total 
                                        amounts determined under 
                                        subclause (II)(bb) for all 
                                        States.
                    ``(C) State's total medicaid quarterly spending 
                amount.--For purposes of subparagraph (A)(i)(II), the 
                State's total Medicaid quarterly spending amount 
                determined under this subparagraph with respect to a 
                State and a quarter is the amount equal to--
                            ``(i) the total amount of expenditures by 
                        the State for providing medical assistance 
                        under the State plan to all individuals 
                        enrolled in the plan for the most recent fiscal 
                        year for which data is available; divided by
                            ``(ii) 4.
            ``(4) Data.--In making the determinations required under 
        this subsection, the Secretary shall use, in addition to the 
        most recent available data from the Bureau of Labor Statistics 
        Local Area Unemployment Statistics for each State referred to 
        in paragraph (5), the most recently available--
                    ``(A) data from the Bureau of the Census with 
                respect to the number of nonelderly adults and children 
                who reside in a State described in paragraph (2) with 
                family income below the poverty line (as defined in 
                section 2110(c)(5)) applicable to a family of the size 
                involved (or, if the Secretary determines it 
                appropriate, a multiyear average of such data);
                    ``(B) data reported to the Secretary by a State 
                described in paragraph (2) with respect to expenditures 
                for medical assistance under the State plan under this 
                title for nondisabled, nonelderly adults and children; 
                and
                    ``(C) econometric studies of the responsiveness of 
                Medicaid enrollments and spending to changes in rolling 
                average unemployment rates and other factors, including 
                State spending on certain Medicaid populations.
            ``(5) Definition of `rolling average number of unemployed 
        individuals', `rolling average unemployment rate'.--In this 
        subsection, the term--
                    ``(A) `rolling average number of unemployed 
                individuals' means, with respect to a calendar quarter 
                and a State, the average of the 12 most recent months 
                of seasonally adjusted unemployment data for each 
                State;
                    ``(B) `rolling average unemployment rate' means, 
                with respect to a calendar quarter and a State, the 
                average of the 12 most recent monthly unemployment 
                rates for the State; and
                    ``(C) `monthly unemployment rate' means, with 
                respect to a State, the quotient of--
                            ``(i) the monthly seasonally adjusted 
                        number of unemployed individuals for the State; 
                        divided by
                            ``(ii) the monthly seasonally adjusted 
                        number of the labor force for the State,
        using the most recent data available from the Bureau of Labor 
        Statistics Local Area Unemployment Statistics for each State.
            ``(6) Increase in cap on payments to territories.--With 
        respect to any fiscal year quarter for which the national 
        economic downturn assistance Federal medical assistance 
        percentage applies to Puerto Rico, the Virgin Islands, Guam, 
        the Northern Mariana Islands, or American Samoa, the amounts 
        otherwise determined for such commonwealth or territory under 
        subsections (f) and (g) of section 1108 shall be increased by 
        such percentage of such amounts as the Secretary determines is 
        equal to twice the average increase in the national economic 
        downturn assistance FMAP determined for all States described in 
        paragraph (2) for the quarter.
            ``(7) Scope of application.--The national economic downturn 
        assistance FMAP shall only apply for purposes of payments under 
        section 1903 for a quarter and shall not apply with respect 
        to--
                    ``(A) disproportionate share hospital payments 
                described in section 1923;
                    ``(B) payments under title IV or XXI; or
                    ``(C) any payments under this title that are based 
                on the enhanced FMAP described in section 2105(b).
            ``(8) Additional requirement for certain states.--In the 
        case of a State described in paragraph (2) that requires 
        political subdivisions within the State to contribute toward 
        the non-Federal share of expenditures required under section 
        1902(a)(2), the State shall not require that such political 
        subdivisions pay for any fiscal year quarters occurring during 
        a national economic downturn assistance period a greater 
        percentage of the non-Federal share of such expenditures, or a 
        greater percentage of the non-Federal share of payments under 
        section 1923, than the respective percentage that would have 
        been required by the State under State law in effect on the 
        first day of the fiscal year quarter occurring immediately 
        prior to the trigger quarter for the period.''.
            (2) Effective date; no retroactive application.--The 
        amendments made by paragraph (1) take effect on January 1, 
        2012. In no event may a State receive a payment on the basis of 
        the national economic downturn assistance Federal medical 
        assistance percentage determined for the State under section 
        1905(y)(3) of the Social Security Act for amounts expended by 
        the State prior to January 1, 2012.
    (b) GAO Study and Report.--
            (1) Study.--The Comptroller General of the United States 
        shall analyze the previous periods of national economic 
        downturn, including the most recent such period in effect as of 
        the date of enactment of this Act, and the past and projected 
        effects of temporary increases in the Federal medical 
        assistance percentage under the Medicaid program with respect 
        to such periods.
            (2) Report.--Not later than April 1, 2011, the Comptroller 
        General of the United States shall submit a report to Congress 
        on the results of the analysis conducted under paragraph (1). 
        Such report shall include such recommendations as the 
        Comptroller General determines appropriate for modifying the 
        national economic downturn assistance FMAP established under 
        section 1905(y) of the Social Security Act (as added by 
        subsection (a)) to improve the effectiveness of the application 
        of such percentage in addressing the needs of States during 
        periods of national economic downturn, including 
        recommendations for--
                    (A) improvements to the factors that begin and end 
                the application of such percentage;
                    (B) how the determination of such percentage could 
                be adjusted to address State and regional economic 
                variations during such periods; and
                    (C) how the determination of such percentage could 
                be adjusted to be more responsive to actual Medicaid 
                costs incurred by States during such periods, as well 
                as to the effects of any other specific economic 
                indicators that the Comptroller General determines 
                appropriate.

Summary: Amends title XIX (Medicaid) of the Social Security Act to authorize an automatic increase in the federal medical assistance percentage (FMAP) for any eligible state during periods of national economic downturn.

Directs the Comptroller General to analyze and report to Congress on previous periods of national economic downturn, including the most recent one, and the past and projected effects of temporary increases in the Medicaid FMAP with respect to them.