Amending the Indirect Hold Harmless Threshold of Health Care-Related Taxes. CMS-2452-P

This proposed rule would revise standards for determining whether an indirect hold harmless arrangement exists for a health care-related tax. Effective October 1, 2026, the WFTC legislation generally sets the threshold equal to the applicable percent of net patient revenue attributable to taxes enacted and imposed as of July 4, 2025. Effective October 1, 2027, the WFTC legislation requires a phase down of the hold harmless threshold in expansion States. We propose to sunset a secondary prong to the indirect hold harmless determination. This rule proposes to add a new permissible class to enhance CMS oversight of health care-related taxes. CMS-2452-P