Medicaid Formula Fairness Act of 2005

H.R. 3335, the Medicaid Formula Fairness Act of 2005, aimed to prevent sharp decreases in federal funding for state Medicaid and Children's Health Insurance Programs (CHIP). The bill proposed a temporary "floor" for the 2006 fiscal year to ensure that no state would see its federal matching rate drop significantly compared to the previous year. Additionally, it sought to change how state wealth is calculated by excluding certain large, one-time employer pension contributions from per capita income measurements, which often made states appear wealthier than they were and resulted in lower federal funding.

For the average citizen, this legislation was designed to stabilize the funding available for healthcare services for low-income families, seniors, and people with disabilities. By preventing sudden cuts to federal support, the bill intended to help states maintain existing benefit levels and eligibility requirements without having to raise state taxes or reduce services to balance their budgets. While the bill was introduced and referred to a subcommittee, it did not advance further to become law.