A number of groups representing the health care industry have begun actively lobbying Congress to extend enhanced Medicaid funding to states. 

If successful, the Medicaid Federal Medical Assistance Percentage, which provided an extra $87 billion to states as part of the economic stimulus package, would extend the enhanced funding for an extra six months. 

Without an extension, the current enhancement in funding will expire January 1, 2011.

Organizations active in the lobbying include the American Hospital Association, Federation of American Hospitals, National Association of Children’s Hospitals, and the National Association of Public Hospitals and Health Systems.

The groups are concerned that without the additional funding, states will be forced to reduce Medicaid costs through reductions in eligibility and benefits, as well as by lowering provider payment rates. 

Both the House and Senate have approved separate measure to extend the enhanced payments, but neither has taken up the other’s bill.

Last week, House leadership introduced the American Jobs and Closing Tax Loopholes Act of 2010, intended to address expiring tax and health policy provisions, including extension of Medicaid payments and a suspension in pending cuts in Medicare payments to physicians.

The House had intended to act on the measure quickly and send it to the Senate for consideration, but concerns over deficit spending and changes in the bill to the 72 hour Medicare rule delayed action.