Issue Brief 10-44
October 25, 2010

The American Recovery and Reinvestment Act of 2009 (ARRA, P.L. 111-5) contained provisions that increase Medicaid grants to states for 27 months by increasing their Federal Medical Assistance Percentages (FMAPs), the share of state programs paid by the federal government. P.L. 111-226, enacted in August 2010, provided a two-quarter phased-down extension of the increased FMAPs included in ARRA, from January 1, 2011-June 30, 2011. The new law also modified the calculation of the ARRA FMAPs for the fourth quarter of federal fiscal year (FY) 2010 and first quarter of FY 2011 (July 1, 2010-December 31, 2010).

This Issue Brief estimates the preliminary first quarter FMAPs for FY 2011 based on the changes included in P.L. 111-226, preliminary state unemployment data for September 2010 published by the Bureau of Labor Statistics (BLS) on October 22, 2010, and the new underlying base FMAPs for FY 2011.