Medicaid Management Improvement Act of 1992 - Establishes a State Medicaid Advisory Panel to review proposed regulations affecting the Medicaid program under title XIX of the Social Security Act and make recommendations to the Secretary of Health and Human Services for changes in such regulations appropriate to take into account the concerns of State and local governments in the operation and financing of the Medicaid program. Requires the Panel to review, and make recommendations to the Secretary about, State requests for waivers of requirements applicable to State plans approved under the Medicaid program.

Gives States the option of delaying implementation of new program requirements until the Secretary promulgates final regulations.

Expresses the sense of the Congress that if a State is required by future legislation to provide for additional services, eligible individuals, or otherwise incur additional costs under its Medicaid program, the Federal Government shall provide for full payment of any such additional costs for at least the first two years in which such requirement applies.

Sets a deadline for actions on waiver applications.

Changes the formula that determines the States' Medicaid matching ratio from the current system based on per capita personal income to a system based on the States' fiscal capacity.

Revises State Medicaid plan provisions to enforce the use of: (1) parental health insurance coverage of children by absent parents; and (2) garnishment of the income of individuals who have been ordered to cover the medical costs of a Medicaid-eligible individual and have received payment for such costs from a third party but have not used them to make appropriate reimbursements.