CMS Moves to Shut Down Medicaid Loophole—Protects Vulnerable Americans, Saves Billions

The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that would close a Medicaid tax loophole exploited by states to inflate federal payments to states, and free up state funds for non-Medicaid purposes.  Some states have exploited these tax loopholes to take money from federal taxpayers and then simultaneously spent “state” money on new benefits for illegal immigrants. This regulatory move is projected to save taxpayers more than $30 billion over five years and continues CMS’ work in ensuring this vital safety net continues to be available for the country’s most vulnerable populations in the future.