Federal judge smacks down CMS reg limiting Medicaid use

A federal judge based in Washington state has taken the side of hospitals in a dispute over the use of Medicaid reimbursement to subsidize safety-net services. In a move that the judge ruled was "deliberately designed to outfox a clear directive of Congress," CMS planned to issue a rule to tie Medicaid payments to provider-specific costs.

This would mean that states would no longer have the freedom to shift Medicaid dollars to hospitals providing indigent care or money-losing services such as trauma and burn care. However, a coalition of healthcare groups, including the National Association of Public Hospitals and Health Systems, the American Hospital Association and the Association of American Medical Colleges, brought suit to stop the implementation of the proposal. The judge held that the rule conflicted with Congress's intentions regarding Medicaid's design.

To learn more about the dispute:
- read this Modern Healthcare article (reg. req.)