The new regulation could blow a $2B hole in the AHCCCS Budget & undo Medicaid expansion
CMS is proposing a set of new wide-ranging regulations that would change the way states can pay for their share of Medicaid costs including supplemental payments. The proposed “Medicaid Fiscal Accountability Rule” will have profound implications for the ways in which States finance Medicaid programs and pay for Medicaid services. It basically changes the ways states can finance the state share of Medicaid costs (including provider taxes like our hospital assessment that pays for Medicaid expansion).
AHCCCS put together a Summary Document that details how the proposed new regulations could impact Arizona’s Medicaid program. Their comment letter is 4 pages long and outlines the challenges the new rule would pose in Arizona.
CMS says that they’re proposing the new rule to “address states’ increasing reliance on donations, taxes, or other financing strategies that CMS perceives mask or circumvent current Medicaid rules regarding how states are permitted to generate the state portion of the Medicaid match.”
In my opinion, CMS (Seema Verma) wants to force states to finance their match with unpopular taxes so states can’t raise that match and instead cut eligibility and/or services.
One thing is certain with the proposed new Rules… it’ll be a game changer in terms of how states are able to finance their portion of Medicaid programs (likely including our hospital provider assessment which pays for the state match for our Medicaid expansion). CMS even concedes that they don’t know how the new Rule will play out in states or how it will affect the real people that rely on Medicaid services.
The comment period ended yesterday (we turned in comments) and the final rule will be announced in the coming months.
