The Implications of New Limits on Medicaid Provider Taxes
Last year’s federal budget reconciliation law, in addition to introducing nearly a trillion dollars in federal health care spending cuts over the next decade, took aim at a tool state governments consider vital in financing their Medicaid programs: provider taxes. For years, states have used provider taxes, typically on some aspect of hospital activity, to help finance their share of their Medicaid programs; currently, 49 of the 50 states have such taxes. Among other benefits, using provider taxes in this manner has enabled states to avoid using more general fund money for this purpose. But the 2025 law imposes new [...]