CMS issues guidance on health care-related taxes in Medicaid
By HME News Staff
Updated 10:28 AM CST, Mon November 17, 2025
WASHINGTON – The Centers for Medicare & Medicaid Services (CMS) has issued preliminary guidance for states on how to implement new federal requirements on health care-related taxes in Medicaid. In line with changes made under the Working Families Tax Cuts legislation, the agency will generally prohibit new or increased health care-related taxes and end financing practices that previously allowed certain states to inappropriately draw down federal matching funds. These provisions are projected to save taxpayers more than $200 billion over the next 10 years, CMS says. “CMS is restoring the federal-state partnership by ensuring that Medicaid dollars are spent responsibly, transparently, and in service of the beneficiaries who depend on this program for their health and dignity,” said CMS Administrator Dr. Mehmet Oz. “While closing a loophole that some states were taking advantage of to shift billions in costs onto federal taxpayers, we have crafted policy that gives states time to transition as the new tax limits are implemented.”
For more go here: https://www.medicaid.gov/medicaid/downloads/providertax_dcl_11142025.pdf
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