Commissioners at the December 14 meeting of the Medicaid and CHIP Payment Access Commission (MACPAC) were presented with research findings from recent efforts to uncover the full scope of provider-level payments for Medicaid-funded services. The primary focus was on complex funding arrangements through provider taxes and intergovernmental transfers (IGTs) which allow states to fund portions of the non-federal share of Medicaid payments. This analysis was requested to assist in understanding correlations between Medicaid payments and Medicaid programmatic goals like access and quality.

In the 10-year period between 2008 and 2018, state general fund contributions to Medicaid expenditures dropped seven percentage points and provider taxes grew ten percentage points as a portion of the non-federal share. These trends show cost shifting for Medicaid to providers, local governments, and the federal budget as increased state-share dollars are used to draw down additional federal funding. With significant interest from commissioners, researcher Robert Nelb noted various data shortfalls and data collection challenges including inter-provider payment transfers, tax or IGT funds that weren’t distributed by the state to the provider classes from whom they were collected, challenges tracking tax costs within provider systems, difficulties identifying IGTs from patient revenues vs. other sources.

More interest and further analysis of this is forthcoming for the commission. This is of interest as significant portions of some providers’ Medicaid revenues are funded and allocated through IGTs or provider taxes.

Additional information will be shared as it is available.