Proposed Medicaid Rule Change Means Less Federal Money For Texas Hospitals

The rule limits what locally generated money can count toward federal matching dollars, and could force some rural hospitals to close.

By Alexandra HartFebruary 11, 2020 12:52 pm

Getting adequate health care in rural Texas can be a challenge. It might become even harder after the Trump administration’s proposed changes to Medicaid rules. If implemented, some hospitals will likely have to cut services or even shut down.

Gwendolyn Wu has been reporting on the story for the Houston Chronicle, and says the rule change has to do with what counts as state and local funds. Local organizations get federal matching dollars to pay for health care for those who qualify for Medicaid. If less local dollars count, that means less federal dollars, and less money altogether to provide health care for those with low incomes. Texas hospital operators estimates the state will lose about $11 billion.

Wu says over 4,000 health care organizations have objected to the rule change.

Rural hospitals could be most affected because a majority of them operate at a loss, Wu says.

“If some of the funding is cut away, they’re estimating that this might mean about $900 million a year in [lost] funding for them,” Wu says.

The rule hasn’t yet gone into effect, and Wu says she doesn’t know when that will happen or if the Centers for Medicaid and Medicare Services will make any changes to it based on the feedback.

“Right now, we’re kind of waiting in limbo,” she says.


Written by Caroline Covington.