LSMS Capsules | 2025 | Legislative Review

uniform provider taxes on all health plans, hospitals, nursing homes and other providers. These provider taxes must be uniform among providers and plans. This uniformity rule can be waived under strict circumstances and many states have received such waivers. Section 44134 requires all state provider taxes to meet the uniformity rule upon enactment of the legislation. If states cannot immediately meet these requirements, federal funding terminates. The legislation does provide a transition, but it is under the sole discretion of the Secretary of Health and Human Services, which is illusory and unreliable. For many states, the proposal would require increasing taxes on commercial health plans which would force them to increase premiums on employers and individuals purchasing insurance coverage. Medicaid plans on the other hand, often receive indirect benefit as they receive the tax investment back from the state through higher payment rates to safety net providers in plan networks. The uniformity rule will be difficult for states to comply. In states with low proportions of commercially insured individuals restructuring their programs to meet these new requirements will be near impossible without massive tax increases resulting in higher premiums. States unable to comply in such an accelerated time frame will face a fiscal crisis, be forced to cut coverage or raise taxes. We respectfully urge Congress to eliminate this provision in the bill. If it remains, Congress should consider a clear and reliable transition period that gives states time to restructure to come into compliance or wind down programs and services.

4. Cost-Sharing Requirements on Very Low-Income Medicaid Expansion Adults We oppose new cost-sharing mandates on extremely low-income Medicaid enrollees. A $35 copay/visit or a 5% income contribution on an income of $15,600 annually, creates a significant barrier to care. Instead, these individuals, many of whom are chronically ill or disabled, will end up hospitalized, driving up costs. Physicians are rarely able to collect such payments from patients effectively making this a provider pay cut.

We urge Congress to remove this provision.

5. Administrative Barriers to Eligibility and Provider Participation. CBO Score: We are concerned that administrative burdens and frequent paperwork requirements to demonstrate employment status and other components of the program will result in legitimately eligible enrollees losing coverage. Moreover, the bill requires states to verify provider enrollment on a monthly basis which will discourage provider participation.

We urge Congress to reduce redundant administrative burdens that keep legitimately eligible patients and physicians off the program.

State Medical Associations and physicians nationwide urge Congress to reject the harmful cuts to Medicaid. Instead, we encourage you to protect and strengthen Medicaid – a proven, cost-effective safety net that serves 80 million vulnerable Americans.

2. Moratorium and Freeze on Provider Taxes – Section 44132. CBO Score: $87 billion cut.

Thank you for your support of physicians and the patients we serve.

We strongly oppose the proposed moratorium and freeze on provider taxes. This freeze amounts to a long- term funding cut as it will not keep pace with increasing health care costs brought on by inflation, economic downturns, public health crises and natural disasters. States will end up reducing coverage and benefits for Medicaid recipients that diminish care, especially in rural communities. Additionally, the moratorium penalizes states that may seek to adopt a provider tax in the future to maintain access, expand behavioral health services or respond to emergencies like the opioid crisis.

Medical Society of Virginia Michigan State Medical Society Minnesota Medical Association

Sincerely,

Alaska State Medical Association Arkansas Medical Society California Medical Association Colorado Medical Society Connecticut State Medical Society Florida Medical Association Hawaii Medical Association Idaho Medical Association Illinois State Medical Society

Mississippi State Medical Association Missouri State Medical Association

Montana Medical Association Nebraska Medical Association New Mexico Medical Society

We urge Congress to remove this proposal.

3. Payment Limits on State Directed Payments - Section 44133. CBO Score: $80 billion cut.

North Dakota Medical Association Ohio State Medical Association Oklahoma State Medical Association Oregon Medical Association Pennsylvania Medical Society Rhode Island Medical Society South Dakota State Medical Association Tennessee Medical Association

We oppose the proposed Medicare payment cap on the State Directed Payments. The provision will negatively impact public hospitals and physician specialists who care for the most complex and critically ill patients across the country. These limits will reduce access to care which is equivalent to coverage losses. The Medicare physician fee schedule is an inadequate benchmark for state directed Medicaid payments. When adjusted for inflation, Medicare payments have declined by 33% over the past two decades and do not cover the costs to provide care. The Medicare Payment Advisory Commission (MedPAC) and the Medicare Trustees have warned Congress that these inadequate payments are limiting access to care.

Indiana State Medical Association Louisiana State Medical Society Maine Medical Association Massachusetts Medical Society MedChi, The Maryland State Medical Society Medical Association of Alabama Medical Society of Delaware Medical Society of New Jersey Medical Society of the District of Columbia

Texas Medical Association Utah Medical Association Vermont Medical Society

We urge Congress to remove this provision.

Washington State Medical Association West Virginia State Medical Association Wisconsin Medical Society

Medical Society of Virginia Michigan State Medical Society Minnesota Medical Association

Mississippi State Medical Association Missouri State Medical Association Montana Medical Association

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