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July 2008

Federal Medicaid Regulations Delayed

On June 30, President Bush signed into law a supplemental appropriations bill that will delay implementation of six Medicaid regulations that were issued by the Centers for Medicare and Medicaid Services (CMS). Officials at CMS claimed that these regulations were aimed at limiting fraud and abuse, but some state policymakers argued that they would limit reimbursement for legitimate services for Medicaid beneficiaries and that they would have a negative impact on state budgets.

The regulations that will be delayed until April 1, 2009 would have:

  • Reduced or prohibited Medicaid reimbursements for public hospitals;
  • Prohibited certain reimbursement for teaching hospitals;
  • Narrowed Medicaid coverage for rehabilitation services;
  • Narrowed Medicaid coverage for school-based administrative and transportation services;
  • Limited Medicaid coverage for case management services; and
  • Restricted how states raise funds for Medicaid via intergovernmental transfers.[i]

The policies laid out in the August 17, 2007 letter related to the State Children’s Health Insurance Program are not slated to be delayed. These policies limit states’ abilities to cover children and their families in households with incomes above 200 percent of the federal poverty level (FPL).

[i]  According to the July 7 BNA Health Policy Report