How Trump's Push for Medicaid Transparency Could Worsen Rural Hospital Crisis

Small rural hospital administrators are concerned that if the changes go through, they may have to close, one expert said.

Donald Trump and Seema Verma appear during a 2018 panel
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The Trump administration is in the final stages of proposing a change to Medicaid that it says will increase financial transparency by hospitals, but health care advocates say will cause vulnerable hospitals to close and hurt Medicaid beneficiaries, NBC News reports.

In an effort to increase transparency, the administration’s rule will require hospitals and states to share more data about the funds they receive through Medicaid, but at the same time it will lead to a decrease in Medicaid’s federal matching dollars by redefining what is considered to be public funds.

The federal government typically matches what those hospitals generate in public funds — including money from state, city and county taxes — as part of its agreement with states, but this rule would reduce hospital supplemental payments and limit state Medicaid financing by creating standards that critics say are vague and go beyond the agency's authority.

Ultimately, the shift could reduce national Medicaid funding from $37 billion to $49 billion annually and cause hospitals to lose $23 billion to $31 billion in annual Medicaid payments, according to the American Hospital Association.

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