California Governor, Lawmakers At Odds Over Prediction Feds Will Approve Tax On Managed Care Organizations

California Gov. Gavin Newsom didn't include the tax, which helps offset the state's Medicaid costs, in his budget because it requires approval from the Trump administration. Lawmakers were more optimistic, pointing out that the federal government has already approved a similar tax in Michigan. The tax is unusual because many managed care organizations want to keep paying it. The money they send to the state is used to draw down federal cash that's sent back to them for providing coverage to Medicaid recipients. Other Medicaid news comes out of Texas and North Carolina, as well.

The Associated Press: Health Tax Splits California Amid Need For Trump's Approval

California lawmakers are headed toward a confrontation with Gov. Gavin Newsom over whether to keep a tax that can generate nearly $2 billion for low-income health benefits but means approval from the Trump administration amid a feud between state and federal officials. Senate and Assembly budget committees finished their versions of the $214 billion annual budget this week and want to keep a tax on managed care organizations. The companies manage Medicaid plans in California, the joint federal-state program that provides health coverage for the poor and people with disabilities. (5/24)

Dallas Morning News: Texas' Medicaid System Hurt Vulnerable People As Insurers Got Rich. Now Major Reforms Head To Gov. Abbott

In 2016, a foster baby born with severe defects needed constant monitoring from a nurse, to ensure he didn't pull out his breathing tube and choke to death. The insurance company Texas pays to provide that care refused, saving Superior HealthPlan as much as $500 a day. Then the state's appeal system failed D'ashon, deferring to Superior. Months later, as D'ashon's nurses and foster mother warned would happen, the baby tugged out his breathing tube when his nurse wasn't around and suffocated for so long that he's now in a permanent "vegetative state." If bills that passed the Texas Legislature this week had been enacted then, D'ashon might have been saved. (McSwane, 5/27)

North Carolina Health News: Would-Be Medicaid Managed Care Groups Ask Judge For Second Look

North Carolina’s ongoing transition to Medicaid managed care system could screech to a temporary halt if an administrative law judge agrees with rejected managed care groups that the process to select contractors was flawed and unfair. Lawyers for three prepaid health care plans — Aetna Better Health, a commercial managed care company; Optima, a health care group connected to Virginia’s Sentara health care system; and My Health by Health Providers, a provider-led group formed by a dozen of the state’s hospital systems – appeared in administrative law courtrooms in Raleigh this month. All three tried to make the case that each deserved another shot at consideration for a lucrative Medicaid managed care contract. (Ovaska-Few, 5/28)

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