Today, U.S. Rep. Bill Pascrell, Jr. (NJ-09) announced a major development in a years-long process over State reimbursement for Medicaid spending totaling $37.32 million. The Centers for Medicare and Medicaid Services (CMS) concurred with a report from the Office of the Inspector General of the Department of Health and Human Services that found that a number of New Jersey counties contributed more funds to Medicaid than they should have when implementing a provision of the American Recovery and Reinvestment Act (ARRA). CMS determined that these overpayments must be returned to the counties. The counties of Passaic and Hudson contacted Rep. Pascrell for his help in urging CMS to issue a decision.

“I applaud CMS for its decision to reimburse New Jersey counties for Medicaid overpayments they made during the recession," Rep. Pascrell said. “I have been pushing CMS to issue a decision on this situation and help make New Jersey counties whole. I urge the State to act expeditiously to complete this process and redistribute these funds. Counties like Passaic are operating on tight budgets and are more than ready for these funds to be reimbursed."

ARRA included a provision that provided a temporary increase to the federal government’s contribution to Medicaid to help states manage increases in Medicaid enrollment and lost state tax revenues during the recession. From this provision, New Jersey received approximately $2.7 billion in additional federal Medicaid funding from October 1, 2008 through June 30, 2011.

“This ruling from the Centers for Medicare and Medicaid Services could not come at a better time for the County of Passaic,” stated Passaic County Freeholder Pat Lepore, chairman of the Budget Committee. While the final amounts are still being determined, Passaic County is expected to receive more than $12 million in repayments. “As we continue to cut costs while maintaining vital services like those provided at the Preakness Healthcare Center, every dollar counts. I am hopeful that the State of New Jersey will swiftly distribute this money to the County of Passaic as required under the ARRA and thank Congressman Pascrell for his diligent advocacy to ensure Passaic County taxpayers got their fair share of this funding.”

"This is an issue the counties have pursued for several years and the findings of the federal government have validated our cause," said Hudson County Administrator Abe Antun, who also serves as president of the New Jersey Association of County Administrators. "We are grateful to Congressman Pascrell and his office for assisting all of New Jersey's counties in our efforts."

On July 14, 2014, the HHS OIG issued a report entitled “New Jersey Did Not Comply With Recovery Act Requirements for Receiving Increased Federal Medicaid Assistance”. The OIG concluded New Jersey did not comply with certain provisions of the law and, as a result, some New Jersey counties contributed more local funding to Medicaid than they should have. The report recommended that New Jersey redistribute funds to make up for the overpayments. However, CMS needed to make the final determination about whether the repayments should occur and the amounts of the repayments. The final amount that each county will receive is still being determined.