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As Congress moves closer to passing federal health insurance reform legislation that will put new burdens on the states — including increased Medicaid costs — Maryland is hoping time and money is on its side.

State officials are reviewing the Senate bill passed on Christmas Eve to determine what it means for Maryland.

It is difficult to say exactly how the state could be impacted by the final legislation, which will combine the Senate bill with the House of Representatives' bill passed last month.

But already some states are sharing concerns over a provision in the Senate bill that would give more federal assistance to states that have not expanded their Medicaid rolls than to those that have expanded.

Maryland is included in the latter group. During a 2007 special legislative session, the General Assembly expanded Medicaid coverage to parents with annual incomes up to 116 percent of the federal poverty level — currently $25,578 for a family of four — whose children are enrolled in the Maryland Children's Health Insurance Program. The bill also offered a subsidy for small businesses to provide coverage for low-wage employees.

"It's our hope that the final bill provides some equity for states like Maryland that have provided coverage on a very comprehensive and aggressive basis," said Shaun Adamec, a spokesman for Gov. Martin O'Malley (D), in an e-mail.

New York Gov. David A. Paterson (D) was quoted in a New York Times article this week as saying the Senate bill "punished" New York state for expanding Medicaid coverage.

Under the Senate bill, the federal government would, for the first two years, pay the total cost of expanding Medicaid to those not currently eligible under their state's program. Over the following three years, the federal government would reimburse states that have not expanded coverage at 95 percent of their costs to cover newly eligible Medicaid recipients. States that already have expanded coverage would be paid back at between 80 percent and 95 percent.

Senate Finance Committee Chairman Thomas McLain Middleton said that with the Medicaid expansion not taking place until 2013 under the House bill and 2014 under the Senate bill, time is on Maryland's side.

"The economy will be rebounded by then, and we can take a look at it," said Middleton (D-Dist. 28) of Waldorf.

In the meantime, Middleton hopes the feds will lend a hand to states that will face an additional burden at a time when budgets are being buried by deficits and mounting Medicaid costs.

The health care reform bill passed by the House of Representatives includes a six-month extension in matching federal dollars for Medicaid.

The extension, through June 2011, would mean $384 million in federal aid for Maryland's general fund.

The Senate bill does not extend the federal aid, but does include a provision that would allow states to change Medicaid eligibility levels if Congress does not extend the enhanced match at the end of 2010.

There has been some discussion of providing a two- to six-month expansion in another bill.

"I'm hopeful we will get the full six months," Middleton said. "The economy is showing signs of improving and a six month expansion could be a bridge to recovery for us."