News from the South - Alabama News Feed

Republicans target a tax that keeps state Medicaid programs running

Published

2 months ago

May 28, 2025

Staff Editor

alabamareflector.com – Shalina Chatlani – 2025-05-28 12:01:00

Republicans target a tax that keeps state Medicaid programs running

by Shalina Chatlani, Alabama Reflector
May 28, 2025

This story originally appeared on Stateline.

The tax and spending bill the U.S. House approved last week targets a strategy states have used to boost the Medicaid dollars they get from the federal government. The measure would cap or freeze the taxes states levy on medical providers, potentially leaving states with major holes in their Medicaid budgets.

As a result, states would face the choice of either replacing the lost federal money with state dollars, scaling back services or providing coverage to fewer people.

Medicaid is a joint state-federal program, primarily for people with low incomes. For the traditional Medicaid population — children and their caregivers, people with disabilities and pregnant women — the federal government matches state Medicaid spending on a sliding scale, ranging from 50% for the wealthiest states to 77% for the poorest ones.

GET THE MORNING HEADLINES.

Consider a state that gets half of its Medicaid funding from the federal government. If that state collects $100 million by taxing providers, it can use $50 million of the revenue to draw down $50 million in federal matching funds, which it can use to expand Medicaid coverage to more people. Then it can take the remaining $50 million in revenue and use that money to draw down $50 million in federal dollars to pay providers more for caring for Medicaid patients.

Forty-nine states — all but Alaska — use the strategy. In 2018, the most recent year for which data is available, states relied on provider taxes to fund 17% of their Medicaid spending, up from 7% in 2008, according to the U.S. Government Accountability Office.

As part of their effort to cut federal Medicaid spending by roughly $625 billion over the next decade, House Republicans have proposed capping the state provider taxes and freezing them in place, preventing states from raising them or implementing new ones in response to inflation. Under current law, states can levy taxes of up to 6% on tax providers’ net revenue. The GOP measure also would add work requirements for Medicaid recipients, a step that would save money by reducing the rolls.

A report from the Congressional Budget Office, the bipartisan research arm of Congress, says eliminating the taxes entirely could save the federal government hundreds of billions of dollars over the next decade.

Many conservatives say the taxes are an accounting trick that allows states to draw down money from the federal government without having to front their true share of the Medicaid program. Some have even called the provider taxes a “money laundering” scheme.

“States are gaming the system — creating complex tax schemes that shift their responsibility to invest in Medicaid and rob federal taxpayers,” Dr. Mehmet Oz, the administrator of the federal Centers for Medicare & Medicaid Services, said in a May 12 news release.

Brian Blase, president of the Paragon Health Institute, a conservative policy group that is working with Republicans to formulate Medicaid cuts, described provider taxes as “a way that states and providers can rip off the federal government.”

“States need to have some accountability for the spending in their programs,” Blase said.

But advocates of these taxes, including state Medicaid directors and even the hospitals that pay the taxes, describe them as legal and legitimate financial tools that have helped providers cover essential services and states fund their Medicaid programs for years. The result of eliminating these taxes or freezing them, they say, will be hospital closures and service cuts.

“We don’t like to pay these taxes, but the alternative is resources or access to care aren’t there for that community,” said Jason Pray, vice president of legislative affairs at America’s Essential Hospitals, an association representing about 350 hospitals. “The state would more than likely have to then tax individuals to make up for that, to keep the services at the same level and keep the resources at the same level.”

Blase said the provider taxes allow hospitals to make windfall profits from the additional federal matching funds that flow back to them, representing a type of “corporate welfare.”

But Pray said often hospitals in his association are losing money. By allowing states to boost payments to hospitals and other providers that serve Medicaid patients, he said, the tax enables hospitals to stay open in the long run, not garner a windfall.

Pray also noted that in the past, support for the taxes has been bipartisan.

“Republicans for years have shown they support provider taxes and have understood the value of them,” he said.

Republicans for years have shown they support provider taxes and have understood the value of them.

– Jason Pray, vice president of legislative affairs at America’s Essential Hospitals

Edwin Park, a research professor at the Georgetown University McCourt School of Public Policy, pointed out that some hospitals pay the tax and don’t get much back, because they serve few Medicaid patients. The hospitals that benefit most are the so-called safety net hospitals that do care for many low-income patients, he said.

Park said he is worried that once the strategy is off the table, states will have to cut their Medicaid spending to balance their budgets.

Jay Ludlam, deputy secretary for North Carolina Medicaid, is worried about that, too. In North Carolina, Ludlam said, almost all of the tax revenue the state collects from providers helps pay for Medicaid services.

“The money goes to providers when they provide services. It’s not special. It’s just another way that states tax themselves and put money into the program,” Ludlam told Stateline. “If it means that there’s going to be less money in Medicaid … we’ll have to cut eligibility, cut benefits, cut provider rates, in order to maintain the program.”

Stateline reporter Shalina Chatlani can be reached at schatlani@stateline.org.

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org.

YOU MAKE OUR WORK POSSIBLE.

SUPPORT

Alabama Reflector is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Alabama Reflector maintains editorial independence. Contact Editor Brian Lyman for questions: info@alabamareflector.com.

The post Republicans target a tax that keeps state Medicaid programs running appeared first on alabamareflector.com

Note: The following A.I. based commentary is not part of the original article, reproduced above, but is offered in the hopes that it will promote greater media literacy and critical thinking, by making any potential bias more visible to the reader –Staff Editor.

Political Bias Rating: Center-Left

The content presents a detailed examination of a Republican-led proposal to cap or freeze Medicaid-related provider taxes, highlighting potential consequences for state Medicaid funding and healthcare services. It includes perspectives from both conservative policymakers critical of the tax strategy and advocates who emphasize its necessity for funding care, with an emphasis on the potential harm to vulnerable populations if these taxes are restricted. While the article is fairly balanced, it leans slightly center-left by focusing on the risks of cuts to Medicaid and the impact on hospitals serving low-income communities, framing Republican policy efforts as threats to access and services.

Up Next

Woman Paralyzed After Tree Lands on Her Car | May 28, 2025 | News 19 at 5 p.m.

Don't Miss

WKRG News 5 This Morning Mobile Parks and Recreation Pools and Programs

News from the South - Alabama News Feed

No one knows whether Trump’s $50B for rural health will be enough

Published

2 days ago

July 20, 2025

Staff Editor

alabamareflector.com – Anna Claire Vollers – 2025-07-20 07:01:00

by Anna Claire Vollers, Alabama Reflector
July 20, 2025

Congress set aside $50 billion for rural hospitals and medical providers to allay fears over the billions more in historic cuts to federal health care spending that President Donald Trump signed into law on Independence Day.

But is that bandage big enough to save struggling rural hospitals?

“I have more questions than I have answers,” said Alan Morgan, CEO of the National Rural Health Association, a nonprofit policy group. “No one has those answers yet.”

GET THE MORNING HEADLINES.

Morgan noted that the new money for rural health, to be spent over five years, is far less than the $155 billion in rural Medicaid spending cuts over 10 years, as estimated by KFF, a nonprofit health policy and research group.

Experts, hospital leaders and lawmakers on both sides of the aisle fear that Trump’s signature legislation will particularly gut rural hospitals and clinics, which see an outsize share of patients who are insured through Medicaid, the federal-state public health insurance for people with low incomes. The new law slashes more than $1 trillion from Medicaid over the next 10 years to help pay for tax cuts that disproportionately benefit the wealthy.

The $50 billion addition was an effort by Republican leaders in Congress to win the votes of colleagues within their party who initially balked at supporting such steep cuts to Medicaid and other health services.

In the U.S. Senate, the rural program helped secure the vote of Alaska moderate Republican Sen. Lisa Murkowski, who expressed concern about the law’s impact on health care in her state. About 1 in 3 Alaskans are insured through Medicaid.

Jared Kosin, the president and CEO of the Alaska Hospital & Healthcare Association, said he’s deeply frustrated with the new law’s gutting of Medicaid funding, which he thinks will wreak lasting damage on Alaskans. And Republicans sidestepped potential solutions by just throwing money into a program, he said.

“It’s frustrating in the public realm when decisions like this are made fast and, frankly, carelessly,” he said.

“The consequences are going to fall on us, not them.”

More than half of the law’s cuts to funding in rural areas are concentrated in 12 states with large rural populations that expanded Medicaid under the Affordable Care Act to cover more people, according to KFF: Illinois, Kentucky, Louisiana, Michigan, Minnesota, Missouri, New York, North Carolina, Ohio, Oklahoma, Pennsylvania and Virginia.

Some GOP lawmakers in Congress have heralded the $50 billion rural program as a health care victory. But it’s still unclear which hospitals, clinics and other providers would receive money and how much.

How it works

The Rural Health Transformation Program will dole out $10 billion annually from fiscal years 2026 through 2030.

States must apply for their funding by the end of this year, submitting a detailed plan on how it would be used.

The law outlines some ways that states can use the money, according to an analysis of the legislation from the Bipartisan Policy Center:

Making payments to rural hospitals to help them maintain essential services such as emergency room care or labor and delivery.
Recruiting and training rural doctors, nurses and other health workers.
Bolstering emergency medical services such as ambulances and EMTs.
Using new technologies, including telehealth.
Providing opioid use disorder treatment and mental health services.
Improving preventive care and chronic disease management.

Half of the $10 billion each year will be distributed evenly across states that have applied for it. The other half can be distributed by the administrator of the federal Centers for Medicare & Medicaid Services — currently Dr. Mehmet Oz — at his discretion, based on a state’s rural population and rural health facilities.

Although the program doesn’t replace the amount states are likely to lose, Morgan said it’s still an opportunity to rethink how rural health care is funded. He’d like to see states given flexibility in how they’re able to use the funds, and he hopes they focus on keeping rural communities healthy through preventive care while still helping hospitals keep their doors open.

“If done correctly, it could really change the future course for rural America,” Morgan said. “That is such a tough ask, though.”

Hardest hit

Kentucky could take the biggest hit from the new law’s reduction in rural Medicaid funding, losing an estimated $12 billion over 10 years, according to a KFF analysis.

The state’s Medicaid department is still waiting for additional federal guidance to understand how the state’s program will be affected, Kendra Steele, spokesperson with the Kentucky Cabinet for Health and Family Services, told Stateline in a statement.

“Over 1.4 million Kentuckians rely on Medicaid — including half of all children in our state, seniors and more vulnerable populations — and the passage of legislation on the federal level will have serious impacts for those individuals, rural health care and hospitals and local economies,” she wrote.

Even with the new program, states across the country will have to reevaluate their budgets in light of the cuts, said Hemi Tewarson, executive director at the National Academy for State Health Policy, a nonpartisan group that supports states in developing health care policies.

“Every region is slightly different and there’s not a one-size-fits-all approach,” she said. “Hospital ownership varies [as well as] the types of services that are critical for the community where they’re located. They have to think about new ways to provide those services in a context with fewer resources.”

About 44% of rural hospitals are operating in the red, according to a KFF analysis of Rand Hospital Data, a higher share than the 35% of hospitals in urban areas.

‘Rural at heart’

Prior to the bill’s passage, Oz attempted to reassure U.S. House Republicans that their districts could get money from the program even if they weren’t specifically rural, Politico reported earlier this month.

We’re all rural at heart when it comes to money.

– Alan Morgan, CEO of the National Rural Health Association

Pennsylvania Republican U.S. Rep. Rob Bresnahan said money would begin flowing to his district as early as the beginning of next year, telling the Wilkes-Barre Times Leader earlier this month that he met with Trump, Oz and others to secure pledges that hospitals in his district could access the fund. He represents the northeastern corner of Pennsylvania, which includes suburban and rural areas, as well as the cities of Scranton and Wilkes-Barre.

Though the legislation includes guidelines on which facilities or areas qualify as “rural,” Morgan, of the National Rural Health Association, expects a mad dash from lawmakers and providers to claim rural status in order to get a piece of the funding.

“That’s going to be a huge issue — defining who’s rural,” Morgan said. “We’re all rural at heart when it comes to money.”

Stateline reporter Anna Claire Vollers can be reached at avollers@stateline.org.

Stateline is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Stateline maintains editorial independence. Contact Editor Scott S. Greenberger for questions: info@stateline.org.

The post No one knows whether Trump’s $50B for rural health will be enough appeared first on alabamareflector.com

Political Bias Rating: Center-Left

The content provides a detailed critique of recent federal legislation that cuts Medicaid funding, especially highlighting its adverse effects on rural hospitals and health care providers. It presents concerns from health experts and policymakers, many of whom emphasize the insufficiency of allocated funds and the disproportionate impact on vulnerable populations. The article underscores the negative consequences of tax cuts favoring the wealthy at the expense of rural health funding, positioning itself by taking a more critical stance toward Republican-led budget decisions. However, it balances the narrative by including perspectives from moderate Republicans and bipartisan efforts, contributing to a center-left orientation that advocates for stronger support of public health without overt partisan demonization.

News from the South - Alabama News Feed

Heat dome leads to excessively hot weather and storms in Alabama’s forecast

Published

3 days ago

July 18, 2025

Staff Editor

www.youtube.com – WVTM 13 News – 2025-07-18 22:28:23

SUMMARY: Gadsden and northern Alabama saw tropical downpours this week, generating fog‑laden skies around Hensley Mountain along the Coosa River. Friday topped out around 89°F in Birmingham. Saturday’s forecast calls for a high near 91°F with spotty afternoon and evening storms—30–40% rain chances in the north, less southward. Sunday will feature scattered, widely spaced downpours with highs ranging from mid‑80s in wet areas to low‑90s elsewhere, like Bessemer (94°F) and Chelsea (92°F). A strong ridge building next week will bring much hotter, drier air and likely a heat advisory from Monday through Thursday. Meanwhile, a possible Ohio Valley derecho and a Gulf disturbance are being monitored.

Heat dome leads to excessively hot weather and storms in Alabama’s forecast

Subscribe to WVTM on YouTube now for more: https://bit.ly/2jvAaUD

Get more Birmingham news: http://www.wvtm13.com
Like us: https://www.facebook.com/WVTM13/
Follow us: https://twitter.com/WVTM13
Instagram: https://www.instagram.com/wvtm13/

Source

News from the South - Alabama News Feed

Mobile teen sends close to 100 care packages to deployed U.S. troops — with more to come

Published

3 days ago

July 18, 2025

Staff Editor

www.youtube.com – WKRG – 2025-07-18 15:41:15

SUMMARY: Sixteen-year-old Abby Turner of Mobile, Alabama, is spreading kindness through her nonprofit, Bright Boxes, by sending care packages to deployed U.S. troops. Inspired by her desire to make a difference, Abby and her family manage every aspect of the project from home—designing logos, organizing supplies, and packing boxes with items like socks, sunscreen, and Chapstick. So far, 96 packages have been shipped through Operation Support Our Troops America. Abby is now expanding her efforts to create 50 boxes for patients at the Ronald McDonald House. Her mission is to bring relief, inspiration, and hope to as many people as possible.