Medicaid Indian Health Act of 2005 - Amends title XIX (Medicaid) of the Social Security Act to: (1) apply 100% of the federal medical assistance percentage (FMAP) to services furnished to an Indian by an urban Indian health program; (2) prohibit the imposition of premiums, deductibles, copayments, and other cost-sharing on Indians; (3) prohibit recovery against estates of Indians; (4) require consultation with Indian tribes prior to approval of "Section 115" waivers; (5) provide for the treatment of medical expenses paid by or on behalf of an Indian by an Indian health program as medical care costs for purposes of determining medically needy eligibility; and (6) give states the option to exempt Indians from reductions in eligibility or benefits.
Requires a Medicaid managed care organization contracting with an Indian Health Service (IHS) facility or program that is not a federally-qualified health center or a rural health clinic to provide payment at the highest level and amount that it would make for the services if they were furnished by a provider that is not an IHS facility or program.