Congressional omnibus package funds Puerto Rico Medicaid program for 5 years

Congressional legislators decided Tuesday to continue financing Puerto Rico’s Medicaid program, and have reportedly structured its funding plan so that federal money can flow to the island for the next five years. If the funding was not bridged with Congressional action, more than a million low-income islanders would have faced the possibility of losing at least some of their health care benefits.

Congress reached the deal as part of an omnibus appropriations package designed to help finance Puerto Rican operations and programs through the end of the 2023 fiscal year, which ends Sept. 30 next year.

The new package allocates more than $17.6 billion of Medicaid funding to the island for the next five years and secures the U.S. government’s portion of Puerto Rico’s costs. The island has a historically high poverty rate that far exceeds that of the U.S. states, but has received significantly less dollar for dollars than even Mississippi, which is the poorest state in the union. 

Supporters of the package say it was of critical importance to the island because without it, the U.S. government portion of Medicaid costs paid to Puerto Rico would return to pre-pandemic numbers, leaving San Juan having to pick up the tab. It would have also resulted in a decreased allotment for the island’s Medicaid program.

The package will purportedly help “Puerto Rico avoid its looming Medicaid funding cliff,” according to Senate Majority Leader Chuck Schumer who worked alongside Cuban American Sen. Bob Menendez to negotiate a resolution.

Schumer added that “the record levels of funding provided in the bill will allow us to expand access to care for our fellow American citizens on the island and ensure long-term stability for Puerto Rico’s hospitals, providers and health care system.”

Menendez argued that that the new omnibus package “will provide Puerto Rico with federal dollars that will enable the island to make critical investments that will help stabilize their health care system, retain health care providers, and improve access and quality of care for all of its residents.”

As a protectorate of the United States, Congress has to consider how it structures federal funding to the island because territories such as Puerto Rico and Guam are not American states that can receive adjustable, open ended funding. Their funding is fixed with ceilings, but sometimes government spending can exceed the budget, especially in times of crises.

Puerto Rico has received about $3 billion annually for its Medicaid program based on how the Centers for Medicare and Medicaid Services calculated the funding cap, 7.5 times the $400 million amount it received before COVID-19 started.

The new omnibus package is designed to give a Medicaid allotments to the island based on the expected annual rise in inflation totaling $3.28 billion for the 2023 fiscal year, $3.33 billion for fiscal year 2024, $3.48 billion for fiscal year 2025, $3.65 billion for fiscal year 2026 and $3.83 billion for fiscal year 2027.

If the bill ultimately fails, Puerto Rico’s aid for the medical program will revert back to its current standard of $400 million.

Some legislators have questioned the calculations from the Centers for Medicare and Medicaid Services, referring to a Government Accountability Office report that said the $3 billion figure for last fiscal year was unauthorized.