CMS Withdraws Proposed Medicaid Rule

September 18, 2020

The Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma tweeted a statement on September 14 withdrawing the proposed Medicaid Fiscal Accountability Rule (MFAR). Initially released last November and expected to be finalized this month, the proposed rule would have greatly restricted the use of certain financing mechanisms (e.g., provider taxes and intergovernmental transfers) employed by states to fund their share of Medicaid provider payments, imposed significant limits on Medicaid supplemental payments—such as Upper Payment Limit payments—and limited the Federal approvals of certain financing and supplemental payment arrangements to three years. Additionally, the rule would have imposed significant administrative burdens on states by increasing reporting requirements.

CMS received more than 4,200 public comments on the proposed rule. GNYHA advocated for the withdrawal of the MFAR and we are grateful to CMS for hearing constituent concerns and reversing its decision.