DELMARVA- Maryland Attorney General Anthony G. Brown is co-leading a coalition of 24 attorneys general challenging a proposed federal rule that the group says could put Medicaid funding at risk and interfere with state regulation of health insurance.
The coalition, which includes Delaware and Virginia’s Attorneys General, filed a comment letter with the Centers for Medicare & Medicaid Services, opposing the proposal. The agency is part of the U.S. Department of Health and Human Services and oversees the federal Medicaid program.
According to the coalition, the proposed rule would change how the federal government treats certain state taxes, fees and other payments when calculating Medicaid funding.
The attorneys general argue that the Centers for Medicare & Medicaid Services is trying to impose restrictions beyond what Congress authorized. They say the changes could affect state taxes and payments involving health insurers, potentially reducing federal Medicaid contributions while also affecting state oversight of insurance companies and Affordable Care Act health exchanges.
The coalition raised four primary concerns.
The attorneys general contend the proposal would improperly penalize states for certain payments collected from health insurers, apply restrictions from a 2025 federal law more broadly than Congress intended, alter criteria established in federal law and create significant new reporting requirements.
Under the proposal, states could also be required to reconstruct financial records dating to mid-2025 and establish new reporting systems, according to the coalition.
“States are already stretched thin funding health coverage for their residents,” the coalition wrote. “This rule adds new federal overreach and red tape on top of that, without adequate legal justification.”
The coalition is asking the Centers for Medicare & Medicaid Services to withdraw the proposal or make significant changes before finalizing it.
