Federal caps on a type of supplemental Medicaid payment could reduce spending in 17 states by amounts equal to 10 to 25 percent of their total annual Medicaid spending, according to a new analysis published in Health Affairs and reported September 9 by Fierce Healthcare. In Nebraska, Louisiana and South Carolina, the projected reduction would exceed a quarter of total Medicaid spending.
The projections cover limits on state-directed payments written into the 2025 federal budget reconciliation law, known as the One Big Beautiful Bill Act. They estimate the effect once the caps apply, not a cut taking effect this year, and the timing depends on federal decisions that are still pending.
