Sponsors (17)
Introduced February 11, 2025 by Richard Hudson · Last progress February 11, 2025
The bill increases federal oversight and clarifies matching rules to prevent Medicaid funds being used for ineligible noncitizens—potentially saving taxpayer dollars and improving program integrity—but shifts costs and administrative burdens onto states and risks reducing access to care for noncitizens.
State governments will receive federal funds and clearer federal guidance to build and operate systems ensuring compliance with the matching prohibition, reducing ambiguity about which administrative activities qualify for federal matching.
Low-income eligible Medicaid enrollees and state budgets may benefit because reduced federal reimbursement for administrative costs tied to ineligible noncitizens could free up Medicaid dollars for eligible populations.
Taxpayers and state policymakers will get a comprehensive federal OIG review that improves oversight and transparency of how states finance and separate Medicaid versus noncitizen benefit costs, which could identify improper use of federal funds and inform corrective actions.
Immigrants and uninsured or low-income individuals could face reduced access to health services if states cut programs or administrative support because of lost federal matching funds.
State governments will bear more administrative costs to comply with the changes, which can increase state budgets, force reductions in other services, or shift costs to taxpayers.
States and health care providers may face increased administrative burdens and potential audits to respond to OIG findings, raising compliance costs and overhead for state governments and hospitals.
Based on analysis of 3 sections of legislative text.
Prohibits federal Medicaid matching funds for state administrative costs tied to programs providing benefits to noncitizens lacking satisfactory immigration status, while allowing match for compliance systems and requiring an OIG report.
Prohibits Federal Medicaid matching payments for state administrative costs used to run programs that provide health benefits to noncitizens who are not lawful permanent residents and are ineligible for Medicaid because of immigration status, while still allowing federal matching for costs to build or operate systems that ensure compliance with the prohibition. Requires the HHS Office of Inspector General to report to Congress within 180 days on state practices separating Medicaid vs. non‑Medicaid costs, controls to prevent use of federal funds for those noncitizen benefits, how states finance such programs, and the extent to which those noncitizens receive drugs under Medicaid drug programs and the effect on drug pricing measures.