On June 30, the Pennsylvania Senate (37-13) and the House of Representatives (117-84) passed a $28.05 billion 2010-2011 state budget ( House Bill 2279 ). This budget reflects $200 million, or less than 1 percent, in spending increases over the 2009-2010 budget.

As part of the budget process, the General Assembly passed (on July 3) the Public Welfare Code amendment ( House Bill 254 ) that will modernize the inpatient fee-for-service hospital payment system, restore proposed budget cuts to hospital supplemental payments, establish enhanced hospital payments through Medicaid managed care organizations, and secure additional federal matching Medicaid funds through the establishment of the Quality Care Assessment. This legislation also provides a contribution to the state of $121 million from the Quality Care Assessment for fiscal year 2010-2011 that was critical to the overall state budget passage. The Governor is expected to sign House Bill 254 , along with the General Appropriations Act and other budget-related legislation, into law soon.

The budget includes $850 million that presumes an extension of enhanced federal medical assistance percentage (FMAP), which Congress has yet to approve. In reaching agreement on the budget, lawmakers and the Governor also agreed that they would meet again to discuss budget modifications to address the possible revenue shortfall should Congress not extend the enhanced FMAP or if Congress extends the enhanced FMAP but at a lower percentage. Additional information about the 2010-2011 state budget is available in HAP Memo 10-73 .

HAP will continue to advocate for Congressional action to extend the enhanced FMAP and will carefully monitor how Pennsylvania legislators and the Governor approach adjustments in state spending should enhanced FMAP be modified or not extended as this would have significant implications for Medical Assistance modernization.

• Governor’s 2010-2011 State Budget
  HAP Memo
• PA Hospitals: State Budget Deal Good for Patients and Providers; Medical Assistance Modernization Boosts Financial Stability
  News Release
• Hospital Advocacy Days to Focus on Medical Assistance Modernization and Restoration of Medicaid Supplemental Payments—Your Involvement is Critical
  HAP Memo
• Update on State Budget—Member Action Requested
  HAP Memo
• Governor’s 2010-2011 State Budget Proposal
  HAP Memo
• PA Hospitals: Proposed State Budget Will Threaten Health Care Safety Net, Health Care Jobs
  News Release
• Pennsylvania Hospitals Strengthen Pennsylvania’s Economy
  News Release