Republicans Say States Are Pulling a Fast One on Medicaid
“Republicans in Congress see a way around the $880 billion budget shortfall they need to fill to extend President Donald Trump’s tax cuts set to expire at the end of the year.
States aren’t going to like it.
To qualify for federal Medicaid dollars, states must also kick in their own matching funds. GOP lawmakers want to stop states from taxing insurers and health care providers to raise that money, a maneuver that would leave states with a $612 billion hole in their budgets over the next decade.
Republican leaders, who are under pressure from some of their rank and file to protect Medicaid, say getting rid of the taxes would not be a funding cut, but elimination of a loophole. They argue that states are inflating Medicaid costs because they kick back the taxes to providers and insurers through higher payment rates — and also sometimes spend the money on items unrelated to Medicaid.
“States and providers scheme so that the provider gets an enormous flow of federal dollars with no state cost exposure,” said Brian Blase, who served in President Donald Trump’s first administration and has pitched restrictions on the state taxes at his think tank, the Paragon Health Institute.”
Read more at Politico.