Category: CMS News

Alternative Headline: CMS Tightens Medicaid Oversight

[MM Curator Summary]: CMS will send states monthly lists of Medicaid enrollees with unverified citizenship status to tighten eligibility enforcement.

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The federal government is continuing efforts to strengthen Medicaid program integrity, announcing Tuesday the Centers for Medicare & Medicaid Services (CMS) will begin providing states new eligibility information.

Starting today, the agency will send monthly enrollment reports containing lists of people with unconfirmed citizenship and immigration status, the agency said in a news release. These individuals were not found in other federal databases such as the Department of Homeland Security’s Systematic Alien Verification for Entitlements program.

The new process will make sure Medicaid or Children’s Health Insurance Program enrollees are citizens, nationals or have a “satisfactory immigration status,” the agency said.

“Medicaid is a lifeline for vulnerable Americans—and I will protect it from abuse,” said Department of Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. in a statement. “We are tightening oversight of enrollment to safeguard taxpayer dollars and guarantee that these vital programs serve only those who are truly eligible under the law.”

States are told they must change an individual’s coverage and enforce eligibility rules after reviewing the cases they receive from the federal government.

The Trump administration has aimed to rein in Medicaid spending and cut waste, fraud and abuse, primarily through the flagship reconciliation bill passed this summer.

Privacy experts sounded the alarm in March when President Donald Trump signed an executive order requiring the HHS to modify guidance that restricted access to unclassified records, after the Department of Government Efficiency, or DOGE, had already accessed sensitive systems at the CMS.

A federal judge told the HHS this week to quit handing sensitive information of Medicaid enrollees over to deportation officials, reported the Associated Press.

https://www.fiercehealthcare.com/payers/cms-seeks-state-compliance-new-medicaid-verification-process

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Alternative Headline: Youth Psych Boarding Rates Vary

[MM Curator Summary]: Over 1 in 10 psychiatric ED visits by youth Medicaid patients involve boarding, with significant variation by state.

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More than one in 10 psychiatric emergency department visits by young Medicaid patients lead to boarding, with rates of boarding varying widely from state to state, according to a recent analysis.

Boarding, or a delay in the time until an ED patient is given an inpatient bed, has been cited as an increasing issue across the country’s EDs. The longer wait for appropriate care not only imposes a potential physical and emotional toll on patients, but can increase the costs of care delivery while increasing stress and personal safety risks for staff.

The “considerable” incidence of boarding outlined in the study is concerning considering that pediatric Medicaid patients already face systemic barriers to timely behavioral healthcare, researchers wrote of their findings in JAMA Health Forum.

The analysis of more than 255,000 ED visits for a primary mental health diagnosis found boarding among more than one in five visits in five states—Iowa, Florida, Maine, North Carolina and Montana, where rates ranged from 27.3% to 21.8%. Substantial variation between these and other states could be due to factors including mental health condition prevalence, Medicaid coverage levels and psychiatric bed capacity, the researchers wrote.

The analysis reviewed Medicaid claims data from 2022 among non-dual Medicaid enrollees aged five to 17 years in 44 states. Boarding was defined as a visit spanning two to six midnights. Longer stays were excluded to minimize the risk of coding errors, which the researchers admitted could have lead to a “more conservative estimate” of boarding frequency and duration.

Overall, 11.9% of psychiatric visits resulted in boarding, which was more prevalent among those with primary diagnoses related to suicide or depressive disorders. The average duration of a stay was 2.1 days across the full sample, with the average length of a boarding event running 4.5 days.

In contrast to the five states over 20%, there were 20 states in which boarding rates were below 10%, led by Arkansas’ 2.7%.

“The substantial state-level differences we observed suggest that state-level policies—including an assessment of the continuum of care that includes inpatient and residential beds, subacute beds, non-ED crisis support, and accessible outpatient care—could play a key role in reducing boarding and its impact on youths and their families,” the researchers wrote. 

https://www.fiercehealthcare.com/providers/considerable-ed-boarding-rates-among-pediatric-medicaid-patients-seeking-psychiatric-care

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Alternative Headline: Subsidies Boost Staffing, Shift Patients

[MM Curator Summary]: Medicaid payroll subsidies raised nursing home staffing but reduced Medicaid patient access as facilities shifted toward Medicare and private-pay residents.

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Five states that used payroll subsidies to drive nursing home staffing increases succeeded, but they also saw nursing homes fill more of their beds with Medicare patients during the same period.

That’s the finding of a new study examining the role of rate add-ons tied to Medicaid census over 13 years.

“Subsidies did in fact induce nursing homes to substantially increase their staffing levels, with the average nursing home increasing their number of direct care worker minutes per resident-day by 7.4%,” Thomas A. Hegland, a senior health and labor economist with the Agency for Healthcare Research and Quality, reported in a study published online ahead of September’s edition of the Journal of Health Economics.

That equated to just over 10 minutes more of per resident-day staffing for each additional dollar of per-resident day subsidies offered in 2010.

But even though the size of the subsidies was linked to the share of Medicaid residents present in a facility, many nursing homes still reduced new Medicaid admissions in favor of “more lucrative” Medicare-covered and private pay patients. 

Each additional dollar in subsidies decreased the Medicaid share of new nursing home admissions by about 1.8 percentage points. Across five states with varying rate add-ons, that led to an 11.5% decrease over the study window. 

“This appears to have been part of a broader shift where subsidy-receiving nursing homes increased their patient turnover rates and shifted toward serving patients with lower overall care needs,” Hegland wrote.

He noted that nursing homes in states with Medicaid payroll subsidies also took on more patients requiring less care, with Activities of Daily Living index scores falling by 2.5% relative to pre-subsidy scores. The states reviewed were not named in an abridged copy of the study reviewed by McKnight’s Long-Term Care News. 

In recent years, more states have considered or implemented Medicaid rate add-ons for quality measure performance or speciality care such as behavioral health. 

But Hegland said policymakers should be aware of the unintended consequences revealed in his study and consider whether the same could occur when adopting other incentives meant to improve quality. He predicted similar reductions in Medicaid patient access could happen where nursing homes face “a substantial gap between Medicaid and other insurers’ payment rates” and when nursing homes are operating at high occupancy levels.

“While nursing home payroll subsidies can be effective tools for increasing nursing home staffing levels and, hopefully thereby, care quality, the broader context of the relatively unique institutional environment in which nursing homes operate can cause nursing homes to respond to the subsidies in a fashion that potentially reduces access to nursing home care among Medicaid enrollees,” he wrote.

https://www.mcknights.com/news/states-created-medicaid-add-ons-to-protect-access-nursing-homes-started-taking-more-medicare-patients-instead/

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Alternative Headline: Health Cuts Spark Maine Outrage

[MM Curator Summary]: Trump’s budget bill, backed by Senate Republicans, is set to slash $400B from health care, risking hospital closures, job losses, and coverage for millions.

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Maine Nurses and advocates rallied outside of Sen. Susan Collins’ Portland office on July 1, 2025, to fight against the proposed health care cuts in Trump’s budget bill. The legislation passed a few days later. Photos courtesy of the Maine State Nurses Association (MSNA).

With hundreds of hospitals on the brink of closure, countless others preparing deep service cuts, and millions of health care workers facing the loss of their jobs, a new report from the health care advocacy group Protect Our Care argues that Congressional Republicans have created a national health care crisis. 

In the report, the group finds that the Trump budget will likely force hundreds of hospitals around the country, including Aroostook Medical Center in Presque Isle and Maine Coast Memorial Hospital in Ellsworth, to close. It also states that more than 15,000,000 Americans will likely lose coverage, and an estimated 477,000 health workers will lose their jobs as a result of Medicaid cuts. 

Advocates say that Sen. Susan Collins’ vote to advance the bill and her off and on efforts to improve it (culminating in a “no” vote that did not impact the close vote and that some see aslargely meaningless) represent a failure to stand up for Mainers. 

In not using her position as chair of the Appropriations Committee to take a stand against the legislation, Maine Democratic Party Executive Director Devon Murphy-Anderson said, “she has cost us our health care. She has cost us freedom. She has cost us the representation that we as Mainers and as Americans deserve.”

Patty Hymanson, a physician and former Maine State representative, also criticized Collins for allowing the bill and its harmful cuts to move forward. 

“The provisions of [Trump’s budget] take slashes to our health care system, raising costs and administrative burdens,” Hymanson said. “… Strains on our health care system already exist and hospitals will likely make difficult decisions. Those who voted for this law to move forward can be held accountable for the harms now.”

The legislation includes the largest cuts to health care in American history. Analysts warn the plan would slash more than $400 billion in critical funding for hospitals, kicking 16 million Americans off their health care, forcing hundreds of hospitals to close or scale back services, and devastating rural economies. Communities would lose access to maternity care, emergency rooms, and lifesaving treatments while thousands of health care workers could lose their jobs.

https://mainebeacon.com/health-care-providers-advocates-call-out-collins-for-supporting-medicaid-cuts-that-will-slash-rural-hospitals-jobs-and-services/

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Alternative Headline: Judge Blocks Medicaid Data Sharing with DHS

[MM Curator Summary]: A judge stopped HHS from giving DHS access to the personal data of all 79M Medicaid enrollees for immigration enforcement.

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WASHINGTON (AP) — A federal judge ordered the nation’s health department to stop giving deportation officials access to the personal information — including home addresses — of all 79 million Medicaid enrollees.

The U.S. Department of Health and Human Services first handed over the personal data on millions of Medicaid enrollees in a handful of states in June. After an Associated Press report identified the new policy, 20 states filed a lawsuit to stop its implementation.

In July, the Centers for Medicare and Medicaid Services entered into a new agreement that gave the Department of Homeland Security daily access to view the personal data — including Social Security numbers and home address — of all the nation’s 79 million Medicaid enrollees. Neither agreement was announced publicly.

The extraordinary disclosure of such personal health data to deportation officials in the Trump administration’s far-reaching immigration crackdown immediately prompted the lawsuit over privacy concerns.

The Medicaid data sharing is part of a broader effort by the Trump administration to provide DHS with more data on migrants. In May, for example, a federal judge refused to block the Internal Revenue Service from sharing immigrants’ tax data with Immigration and Customs Enforcement to help agents locate and detain people living without legal status in the U.S.

The order, issued by federal Judge Vince Chhabria in California, temporarily halts the health department from sharing personal data of enrollees in those 20 states, which include California, Arizona, Washington and New York.

“Using CMS data for immigration enforcement threatens to significantly disrupt the operation of Medicaid—a program that Congress has deemed critical for the provision of health coverage to the nation’s most vulnerable residents,” Chhabria wrote in his decision, issued on Tuesday.

Chhabria, an appointee of President Barack Obama, said that the order will remain in effect until the health department outlines “reasoned decisionmaking” for its new policy of sharing data with deportation officials.

A spokesperson for the federal health department declined to directly answer whether the agency would stop sharing its data with DHS. HHS has maintained that its agreement with DHS is legal.

Immigrants who are not living in the U.S. legally, as well as some lawfully present immigrants, are not allowed to enroll in the Medicaid program that provides nearly free coverage for health services. But federal law requires all states to offer emergency Medicaid, a temporary coverage that pays only for lifesaving services in emergency rooms to anyone, including non-U.S. citizens. Medicaid is a jointly funded program between states and the federal government.

Immigration advocates have said the disclosure of personal data could cause alarm among people seeking emergency medical help for themselves or their children. Other efforts to crack down on illegal immigration have made schools, churches, courthouses and other everyday places feel perilous to immigrants and even U.S. citizens who fear getting caught up in a raid.

“Protecting people’s private health information is vitally important,” Washington state’s Attorney General Nick Brown said in a statement. “And everyone should be able to seek medical care without fear of what the federal government may do with that information.”

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https://apnews.com/article/rfk-jr-medicaid-data-deportation-immigrants-trump-9a6ac84c6c23a608cfc5d343f6433c7f

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Alternative Headline: GOP Eyes Medicare, Medicaid Cuts

[MM Curator Summary]: Republicans, guided by Paragon Health Institute, are weighing further cuts to Medicaid and potentially Medicare as part of a new reconciliation package.

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The briefing will also cover the 340B drug discount program; proposals to even out Medicare payments for outpatient services, known as “site neutral” payments; plans for expanding tax-advantaged Health Savings Accounts for medical expenses; and arrangements that allow employers to reimburse employees for insurance premiums and medical expenses with pre-tax dollars.

Blase, who did not respond to a request for comment, served on the White House National Economic Council during Trump’s first term. He and other conservative health wonks launched Paragon in 2021, and it has rapidly gained influence in GOP policy circles. Former Paragon staffers are now top health aides to Speaker Mike Johnson and President Donald Trump.

Blase will be joined by two other Paragon officials at the RSC briefing: Demetrios Kouzoukas, who is the director of Paragon’s Medicare Reform Initiative, and Gabrielle Minarik, a program manager. Kouzoukas, a former executive in UnitedHealth’s Medicare arm, also served as chief executive of the Medicare program at the Centers for Medicare and Medicaid Services during the first Trump administration.

While Republicans reaped hundreds of billions of dollars of cuts from Medicaid in the One Big Beautiful Bill Act, they stopped short of the more ambitious changes that Blase and conservative lawmakers have advocated. Now, even senior Republicans acknowledge their options for new spending offsets are drastically limited, and both Medicaid and Medicare are likely to emerge as tempting targets as talks proceed. “It’s clear we’re scraping the bottom of the barrel for cuts,” said one Republican with direct knowledge of the early conversations around a second GOP-only package.

But any push to further slash federal health care spending — let alone the politically explosive issue of Medicare changes — is likely to be met by fierce pushback by vulnerable House Republicans as well as some more conservative-leaning members. Some Senate Republicans, meanwhile, are deeply skeptical a second reconciliation package would have enough support to pass — especially absent a major, unifying centerpiece akin to the tax cuts embedded in the first package.

https://www.politico.com/news/2025/08/13/house-medicaid-cuts-brian-blase-00508181?mkt_tok=NzczLU1KRi0zNzkAAAGcTbNO3wCRve5AJuhmmKmgBmfAwvg1aHbDRE6LMKFaUiUyVd0KCKK-X9Kz-12uUL_yil1UhZVdx-zV18V0LB9ukhbsefOAbBNhTXCeNWgqM6E

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Alternative Headline: Medicaid Cuts Endanger Ex-Prisoners

[MM Curator Summary]: Medicaid cuts and new work requirements under the Big Beautiful Bill could strip coverage from formerly incarcerated people, increasing deaths and recidivism.

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Over the past 15 years, formerly incarcerated people have greatly benefited from expansions to Medicaid healthcare coverage. Those gains are now at risk in the face of an estimated $1 trillion in federal spending cuts outlined in President Donald Trump’s One Big Beautiful Bill Act. Experts who spoke to The Marshall Project warn that the lost coverage will lead to unnecessary deaths.

Medicaid coverage is especially important for people post-release, because incarceration can wreck their health. One long-term study published in 2021 that investigated the mortality consequences of incarceration using national data found that imprisonment decreased the life expectancy of a 45-year-old person by 13%.

Dr. Shira Shavit, the co-founder of the Transitions Clinic Network, which provides care to people post-incarceration, has seen the toll of imprisonment on her patients.

“Carceral systems are not really set up to be healthcare systems,” she said, before pointing to the conditions often found in jails and prisons, such as overcrowding and inadequate treatment for chronic diseases, mental health, and opiate use disorder. The poor health that people develop on the inside follows them when they get out, and can worsen as they struggle to access consistent health care.

As an example, Shavit pointed to a patient she’d recently treated after prison. He was enrolled in Medicaid in the wrong county, and fixing the error caused him to miss three months of lifesaving cancer treatments.

Since Shavit co-founded Transitions in San Francisco in 2006, she has seen successive federal efforts to try to expand health care coverage and close the gaps for her post-incarceration patients.

The expansion of Medicaid under President Barack Obama’s 2010 Affordable Care Act, was the first major advance in access to care. According to the U.S. Government Accountability Office, the act made health insurance available to 80% to 90% of formerly incarcerated people who had previously been ineligible. Shavit noted that President Joe Biden’s administration gave states permission to enroll incarcerated people in Medicaid prior to their release. “This allows people to get care that might not have been historically provided as they were leaving incarceration, like medications for opiate use disorder,” Shavit said.

Interruptions to care can be deadly. One widely cited study on people released from the Washington State Department of Corrections between 1999 and 2003 found that they faced a risk of death almost 13 times higher than other state residents, largely due to the risk of drug overdose. Grim realities like these have Shavit fearing the fallout from the Big Beautiful Bill, which the Congressional Budget Office estimates will increase the number of uninsured people nationwide by more than 10 million over the next decade.

“This pulling back on access to Medicaid post-release is really a step backwards,” Shavit said.

The most consequential change to Medicaid in the new bill are work requirements, which go into effect on Dec. 31, 2026 and drive the largest share of expected cuts to the program. Under the new requirements, Medicaid enrollees older than 19 will have to demonstrate that they’ve been employed, or are participating in forms of “community engagement,” such as community service, for at least 80 hours in the month prior to health coverage. To maintain coverage, they’ll need to re-certify their work status at least every six months.

Wanda Bertram, a communications strategist for the Prison Policy Initiative, an advocacy non-profit focused on mass criminalization, believes these stipulations are especially burdensome for the formerly incarcerated, who face stigma when trying to get hired. “Our data says that 27% of people who have been to prisons are unemployed, meaning they want to work, but they cannot find work,” Bertram said. By comparison, the nation’s unemployment rate is 4.2%.

Michigan University law professor Mira Edmonds says many formerly incarcerated people are working, just not in jobs that would fulfill the requirements in the new legislation. Because their criminal record worsens employment impediments like racial discrimination and incomplete schooling, “the jobs that they can get are on the black or gray market, under the table,” Edmonds said. Those jobs are inconsistent and can’t reliably provide references.

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The new law does have some carve outs that could blunt the impact on incarcerated people, most notably a pause on work requirements for three months after a person has been released from prison. There are also exemptions from work requirements for people with proof of a qualifying condition, such as substance use disorder or a developmental disability.

But Shavit says that the three-month pause is not enough time to find your footing after prison. “It is so difficult to manage the needs and requirements from probation and parole in those first few months. People have to pick and choose where their priorities lie and are often very confused about how to navigate the systems,” she said.

Lily Roberts, the managing director of inclusive growth for the progressive nonprofit Center for American Progress, believes these exclusions are almost as onerous as the work requirements. The exclusions call for paperwork and doctor’s visits — all while people are dealing with their health issues. Roberts added that the red tape is likely self-defeating, if the point is to promote employment. “People who are healthy get a better job, and they stick with it for longer,” she said.

Trump officials like Dr. Mehmet Oz, administrator for the Centers for Medicare and Medicaid Services, tout work requirements as an opportunity for beneficiaries to “show they have agency over their future” and as a way for the federal government to fight “waste, fraud, and abuse.”

But Andy Schneider, a research professor for the Center for Children and Families at Georgetown University with more than 50 years of experience working with Medicaid, believes the requirements are just a tactic to “make states walk away from adults covered under the ACA Medicaid expansion.”

Something similar is already happening in Georgia, which implemented Medicaid work requirements in 2023 through a program called Pathways. The program was pitched as a way to get people coverage and get them back to work. But according to a recent investigation by ProPublica and The Current, Pathway’s enrollment has been 75% lower than initially estimated, in part because of the onerous process and the state not having enough people to help with sign-ups. At the start of this year, there were thousands of applications still being processed. And more than 40% of the people who started applications gave up.

“It’s diabolical to make cuts that you know are going to make it harder for people who were otherwise eligible to access these programs,” Roberts said. “This doesn’t incentivize people to get a job. It incentivizes people to quit trying.”

Schneider, the Georgetown researcher, believes that formerly incarcerated people across the country will be especially vulnerable to losing coverage due to the work requirements’ paperwork. But he said states will also suffer — even if some of those states want to continue covering the scores of formerly incarcerated people who were eligible for Medicaid under the ACA. “On a day-to-day basis, it’s the states that are gonna have to administer all this paperwork and ultimately, they’re going to have to outsource that work to private companies,” Schneider predicts.

In Georgia, Deloitte Consulting has been paid more than $50 million for software the state uses to help verify work requirements. According to reporting by ProPublica and the Current, users of Deloitte’s application have had issues with their info disappearing and their progress being erased.

“The point is the red tape,” Schneider said of work requirements. “It’s designed to make it more painful.”

Bertram, from the Prison Policy Initiative, agrees that work requirements are not being instituted to fight fraud. “When you think about it, you realize that you can’t cash in and sell your Medicaid on the black market,” she said. “The idea that people would be personally profiting off their Medicaid coverage is just totally out of whack.”

Instead of fighting crime, Bertram believes that rolling back access will create more crime. That’s because, according to research by the Prison Policy Initiative, states that expanded Medicaid have seen lower recidivism — the number of formerly incarcerated people who commit new offenses. One study found that in those states, the recidivism rate of “multi-time offenders with violent offenses” was as much as 16% lower during the first two years after they left prison, compared to states that did not expand health coverage between 2010 and 2016.

“The consequence of these requirements is going to be that more people end up arrested and in jails and in prisons, which has its own cost,” Bertram said of the Big Beautiful Bill mandates. “This bill is a transfer of public spending away from healthcare and towards incarceration, which I think is in line with the Trump administration’s explicit priorities.”

https://www.themarshallproject.org/2025/08/09/medicaid-prison-health-care

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Alternative Headline: Medicaid Cuts Threaten Kids

[MM Curator Summary]: Medicaid cuts and shifting eligibility rules threaten children’s access to therapies, devices, and health care that support school success.

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Advocates worry confusion over shifting rules will make children miss out on tablets, glasses, hearing aids and therapy that help in the classroom.

Speech therapist Anne Marie Carey sits on the rug at Galvin Therapy Center west of Cleveland, Ohio with toddler Ryin Johnson holding a tablet while she places a bright plastic ring on a rod.

“I have some more,” Carey says to the 2 1/2 year old, picking up another ring. “Should we put it on? I’m gonna do it with you.”

She takes Ryin’s hand and presses a finger to the tablet so a recorded voice says “More,” before adding the second ring to the cone.

“More!” Carey calls out. “I got more. Yay!”

This activity is more than just a game. Ryin has autism and is nonverbal, so he also receives behavioral therapy. His attention often drifts as he and Carey interact.

But the tablet, once Ryin can use it himself, is a tool that may unlock his ability to communicate and learn when he starts preschool in the fall. It might even help him eventually speak.

“Right now it’s still pretty early on,” said his mother Deanna Szente, a delivery driver from Avon Lake, Ohio. “Because he’s two and a half, we’re having high hopes, but they are preparing him… if he does not.” 

Deanna Szente is thankful Medicaid pays for her son Ryin’s behavior and speech therapy, but worries if she can keep coverage for him and what will happen to other children if recent cuts to Medicaid remain. (Photo by Patrick O’Donnell, The 74)

Ryin’s therapies, tablet and the TouchChat program are all funded by Medicaid — and examples of how the government program, a major source of health care for low-income families, also supports children’s ability to learn and do well in school.

Medicaid also covers such school-related items as eyeglasses, hearing aids, and microphones for teachers to use to communicate with children with hearing difficulties.

Other devices and care, such as inhalers for asthma and dental coverage provided by Medicaid help make sure kids don’t miss school and add to the chronic absenteeism problems hurting kids academically.

But Medicaid faces massive cuts starting in 2027 as part of President Donald Trump’s “Big Beautiful Bill.” Cuts to Medicaid and to the accompanying Children’s Health Insurance Program (CHIP) will likely total about a trillion dollars over the next 10 years, according to estimates.

Backers of Trump’s bill say it is much-needed welfare reform that will keep people on Medicaid who really need it, while kicking off those that don’t and can work to have insurance.They also stress that students with disabilities like Ryin are not targets of the cuts.

But how the cuts will affect Ryin and other young children is still unclear: The impact will vary by state, since each has its own version of Medicaid, with different rules for eligibility and benefits, and each state contributing different amounts of money. Differences are so great that a family of four qualifies in some states earning less than $45,300 a year, while other states allow annual income of more than $96,000.

As Medicaid dollars shrink and as rules shift and grow more complicated, child advocates worry students like Ryin are more likely to slip through the cracks and miss out on interventions that are crucial to their ability to learn. They also worry the Trump administration’s removal of some backstops that keep kids on Medicaid even as parents bounce on and off it create additional danger for children.

All of which filters down to how well kids can do in the classroom.

“If the cuts are coming and if kids lose services, it can be very impactful on their learning,“ said Patricia Endley, president of the National Association of School Nurses.

Georgetown University’s Center for Children and Families researchers also raised concerns about students losing coverage and medical care that helps them in school. The center pointed to multiple studies showing students read better if they qualify for Medicaid or even if parents have Medicaid coverage that reduces family stress and frees up income.

Other studies show students covered by Medicaid have higher graduation rates and adult earnings than those that go without health coverage, Georgetown officials report.

Elisabeth Burak, senior fellow at the Georgetown center, worries that as rules change and grow more confusing, parents might not enroll their children or let coverage expire.

“We know that a lot of these kids will roll on and off of coverage,” Burak said.

“They might have been enrolled for a little bit of time at some point during the year, but they dropped off because the mail didn’t reach them, or there was paperwork that their parents didn’t know about, or maybe their parent might have lost coverage and that somehow the renewal paperwork didn’t get to them,” she said.

Beyond just the common-sense idea that healthier kids do better in school or life, researchers and advocates identified several tangible ways student learning could be hurt if students lose coverage:

• Kids might miss out on early screening that catches disabilities before reaching school age. While Ryin might keep Medicaid because of his disability, being eligible for Medicaid allowed him to get checkups that identified his autism and allowed him to start treatment before preschool.

Though school district preschools can catch students’ disabilities, church-based or private preschools might not. Parents may need private therapy for their children.

“We have a lot of preschoolers… who attend community preschool or no preschool, and who come to our place for help,” said Carey, Ryin’s speech therapist. “Parents notice something’s not clicking…and they come here.”

• Children might have to wait until school for vision tests and might not ever afford eyeglasses. In addition, students may not have hearing aids to absorb words and language patterns.

“They’re going to have difficulty learning those important speech sounds and strategies to be able to follow classroom conversations,” said Caroline Bergner, director of health care policy for Medicaid for the American Speech-Language-Hearing Association.

•  Children may not have inhalers so they can deal with asthma in the classroom. Researchers have found asthma to be a major cause of students missing school – nearly 13 million school days a year nationally — and of students having to repeat grades.

That’s all on top of family disruptions and stress if kids keep Medicaid but parents lose it under the new rules.

Endsley also worries about students struggling if they lose dental care.

“You might say, ‘well, what does your teeth have to do with learning?’ ” she said. “Well, if you have an impacted tooth, or if you’re having tooth pain, you absolutely cannot learn… if you’re sick or if you have a chronic disease… Having access to daily medications keeps kids in school. It really is all interconnected.”

Defenders of the bill say opponents are being overly dramatic, noting that benefits for disabled children are not being directly cut. Well-publicized requirements that adults work in order to keep coverage don’t apply to parents since they don’t kick in until children turn 19. And they say the cuts make Medicaid sustainable by trimming people that don’t need it.

Others, including Cato Institute researcher Michael Cannon, argue that limiting Medicaid’s growth is necessary for the federal budget.

“When Republicans propose that Medicaid grow at 3% annually instead of 4.5%, Democrats suddenly act like cutting waste means everyone will die,” he wrote.

Even child care advocates worried about the plan can’t say which children would lose coverage or how many and when.

They instead see risks in the confusion of shifting rules that states – and parents – will have to watch carefully.

A big reason is that Medicaid eligibility isn’t the same for children and adults, so children can still keep coverage even if parents start earning more money and lose their coverage. Parents may not realize that and let their children’s coverage lapse.

Endsley, who worked as a school nurse in Maine, said parents often don’t know how to apply for Medicaid for their kids.

“They’ll say, ‘Well, yeah, I just can’t figure it out’,” she said. “So sometimes a school nurse will help them navigate through the process, or refer them to an insurance navigator. I’ve even made a home visit to help a parent who didn’t have a computer work out the forms.“

“The whole system application process can be complicated, and what I see is kids slipping through the cracks,” she said.

There are some existing safety nets to prevent kids bouncing on and off coverage: Children keep coverage for a full year each time their eligibility is approved. Eight states — Colorado, Minnesota, New Mexico, New York, North Carolina, Oregon, Pennsylvania and Washington — went further the last few years and extended that “continuous coverage” for young children until they turn 3 or 6 to create more stability.

But the Trump administration announced July 17 it would no longer let states extend coverage beyond a year.

Bruak called that decision a “kicker” on top of the cuts.

“That could really impact the stability of family and kids coverage,” she said.

Meanwhile, Szente is talking regularly with child care advocates to stay on top of changes so she can do what it takes to keep all three of her children covered.

“I’m terrified,” Szente said. “I’m scared for when my son gets older, what we’re going to have to do to be able to make sure that he can go see a doctor. And I’m scared for my older two, if I’m still going to be able to provide Medicaid for them.”

This story was produced by The 74, a non-profit, independent news organization focused on education in America.

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https://ohiocapitaljournal.com/2025/08/15/trump-medicaid-cuts-could-cost-kids-coverage-that-aids-learning/

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Alternative Headline: Hospitals Face Medicaid Squeeze

[MM Curator Summary]: Medicaid payment limits from the One Big Beautiful Bill will slash hospital revenues, drive service cuts, and accelerate rural hospital closures amid rising uncompensated care costs.

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Hospitals are putting major expansion projects on hold and bracing for service cuts as new limits on Medicaid state-directed payments threaten to squeeze already tight finances. 

Making matters worse, many hospitals will see their revenue and margins decline as millions of Americans lose health coverage and uncompensated care costs rise under the recently enacted budget reconciliation package, dubbed the One Big Beautiful Bill.

The law restricts new Medicaid state-directed payments, financial arrangements allowing states to make supplemental payments to healthcare providers for services covered under managed care contracts. It caps such payments at 100% of Medicare rates in Medicaid expansion states and 110% in non-expansion states, while gradually cutting existing payments above those levels starting in 2028. 

The changes will slash federal Medicaid spending by $149 billion over 10 years, according to health policy research firm KFF.

State-directed payments enable states to mandate that Medicaid managed care plans compensate providers at specific rates, which have been benchmarked against commercial insurance rates that can be double or triple what Medicare pays. The payments have become a critical revenue source, totaling more than $100 billion in annual Medicaid spending nationwide.

As state-directed payments are cut, hospitals will also have to contend with a rise in the uninsured population, which is expected to increase by 10 million under the legislation and add $433 billion to hospitals’ uncompensated care costs from 2025 to 2034.

Safety-net hospitals will be especially vulnerable because they treat large numbers of Medicaid and uninsured patients.

“Our member hospitals are really going to be in double jeopardy over the next few years,” said Beth Feldpush, senior vice president of advocacy and policy at America’s Essential Hospitals, which represents more than 350 safety-net providers. “Their uncompensated care costs are going to rise because people are still going to come to them for treatment, and once they’re uncovered, a lot of those costs are just going to end up as uncompensated care costs for our hospitals.”

The bigger picture

The state-directed payment cuts, which are the third-largest source of federal Medicaid savings in the reconciliation package, come as congressional watchdogs raise concerns about the rapid growth and transparency of state-directed payments. 

The Medicaid and CHIP Payment and Access Commission, which advises Congress on Medicaid payment policy, has called for better oversight, noting that “it’s not clear the extent to which state directed payments have made meaningful improvements in access” to care. 

MACPAC has also raised concerns about states using creative financing schemes that could inflate federal Medicaid funding without states having to invest their own resources.

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Hospitals say state-directed payments are an important source of funding, especially for providers in rural and underserved communities with a large share of Medicaid patients, because the program typically reimburses significantly less than Medicare or commercial insurance. 

Providers or facilities that care for a lot of Medicaid patients rely on a patchwork of funding streams, including state-directed and disproportionate share hospital payments, to shore up their balance sheets, hospitals say.

“Beyond just supporting day-to-day operations, these programs have been truly transformative in communities across the country,” Feldpush said. “Those are the communities that are on the edge for healthcare access as it is — in these small towns or rural counties, they are really at risk of losing healthcare in those areas if this all moves forward.”

Limited state options

States can try to replace the lost federal funding, but many are constrained by their budgets. Although the new limits on state-directed payments will cut 14% of total federal Medicaid spending over 10 years, some states, such as Louisiana, Illinois, Nevada and Oregon, face spending reductions of 19% or more.

Many financing arrangements exist because states don’t have enough general funds to support their Medicaid programs fully.

“It’s going to be incredibly challenging for states to backfill that funding because states typically aren’t sitting around with a lot of cash available to them,” Feldpush said.

States will likely need to make tough choices, including cutting provider payment rates, eliminating optional benefits or limiting Medicaid eligibility, according to Avi Herring, managing director at Manatt Health.

Hospitals rework their plans

Hospital executives are already revising their strategic plans as financial pressure mounts. Expansion projects and new facilities will be the first to face cuts as providers try to preserve cash for the operational challenges ahead, Feldpush said.

“The first thing they’re going to do is pull back on new spending,” she said. “If they had a plan in place to open a new outpatient cancer center or expand a clinic in a certain neighborhood, those are the types of projects that they’re probably looking at now and maybe making decisions that they need to hold off on.”

The impact will vary widely by provider and state, with some hospitals potentially losing millions in annual revenue. 

For-profit hospital chains are projecting hundreds of millions in losses. Universal Health Services said cuts to state-directed payments and other provisions could cost it between $300 million to $400 million by 2032. Tenet Healthcare, another large operator, expects about $1.1 billion to $1.2 billion in the payments for 2025.

Rural hospitals are especially at risk, with 44% already operating in the red, according to KFF.

In Kansas, 87% of rural hospitals already operate at a loss, despite receiving state-directed payments, with 47 of them being vulnerable to closure. If payments were reduced to 100% of Medicare rates, hospitals in the state would see a decline of up to 21% in Medicaid payments, according to the Commonwealth Fund.

“This legislation will limit access to care for all rural patients by ending health care coverage for rural residents nationwide and putting financial strain on rural facilities who care for them,” National Rural Health Association CEO Alan Morgan said in a July statement.

Providers are working with states to ensure that existing payments qualify for “grandfathering” under the law, which would allow them to continue at current levels before the reductions start in 2028.

“In the short term, providers are working in collaboration with states to ensure CMS will grandfather their SDPs under the law,” Herring said. “In the medium-to-long term, providers are concerned that the impact of the SDP reductions — along with other provisions like work requirements and reductions to the allowable provider tax threshold — will make it much more difficult for them to sustainably serve Medicaid enrollees.”

Congress appropriated $50 billion for the newly created Rural Health Transformation Program to shore up rural provider finances. However, rural providers argue that the funding, which accounts for 37% of the estimated loss of federal Medicaid funding in rural areas, won’t be enough to maintain access to care.

“NRHA is concerned that the Rural Health Transformation Program, dedicated to offset the Medicaid cuts on rural communities, will fall short of addressing the other provisions in this legislation,” Morgan said.

Snowballing financial pressure

If the financial squeeze gets worse, hospitals will move beyond freezing expansion to cutting existing services, Feldpush said. 

Providers may close clinics in areas with high uncompensated care costs, eliminate wraparound services like social workers, or take beds offline if they can’t afford adequate staffing.

“If the financial situation is really as bad as we anticipate, then they would have to look at where they might have to pull back on services in their community,” Feldpush said. “The first step is not expanding. The second step is pulling back on what you have. And then ultimately, if none of those things work and the hospital is still in really dire financial straits, that’s when you see hospitals closing.”

It’s not just hospitals that will feel the pinch. Nursing facilities, where Medicaid pays for more than 60% of residents, and behavioral health providers that rely heavily on state-directed payments could also cut back on services.

The financial pressure will intensify over time, with 76% of the reductions from the bill expected to occur in the final five years through 2034.

For hospitals already operating on thin margins, the combination of reduced Medicaid payments and increased uncompensated care costs could prove unsustainable, potentially triggering a wave of service reductions and facility closures in communities that can least afford to lose access to healthcare.

“Ultimately, the cuts will reduce Medicaid funding to providers, which is likely to limit access to care for Medicaid patients,” Herring said.

https://www.healthcaredive.com/news/hospitals-prepare-for-149b-cut-to-medicaid-state-directed-payments/757309/

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Alternative Headline: 340B and New Health Law

[MM Curator Summary]: Hospitals, lawmakers, and regulators are advancing new legal, legislative, and pilot program changes around the 340B program amid the enactment of the One Big Beautiful Bill Act.

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The AHA, joined by several other national groups representing 340B hospitals, Aug. 8 urged the Health Resources and Services Administration to extend the…

The AHA today filed an amicus brief in the U.S. Court of Appeals for the D.C. Circuit, defending the Department of Health and Human Services’ decision to…

The Department of Health and Human Services today issued a notice announcing a 340B Rebate Model Pilot Program as a voluntary mechanism for qualifying drug…

The recently enacted One Big Beautiful Bill Act will bring big changes to health care. AHA President and CEO Rick Pollack joined me for a Leadership Dialogue…

Rep. Doris Matsui, D-Calif., and Sen. Peter Welch, D-Vt., today introduced the 340B Patients Act, AHA-supported legislation that would codify 340B providers‘…

The Congressional Budget Office today released its estimate of the budgetary effects of the One Big Beautiful Bill Act, as enacted. CBO projects the law will…

https://www.aha.org/news/headline/2025-08-13-cms-releases-2025-2026-medicaid-managed-care-rate-development-guide

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