Congressional report estimates CMS changes would cost states $50 billion in federal aid

WASHINGTON According to a congressional report prepared by the Democratic staff on the House Committee on Oversight and Government Reform, proposed changes to Medicaid would cost states about $50 billion in federal aid over the next five years, the Associated Press reported.

"As the economy tips into recession, the last thing we should be doing is taking federal funds from states, especially funds that are supposed to help people with their health and medical expenses," said committee chairman, Rep. Henry Waxman, D-Calif.

Federal officials, though, are arguing that the changes are designed to ensure that providers don’t bill the program for more than costs of providing care and also say that the states pay their fare share of the program.

Tthe proposed new rules include limiting Medicaid public hostpital reimbursement to no more than the cost of providing a particular service. Another would prohibit billing Medicaid for the costs of medical interns and residents.

Overall, the federal government will spend more than $1.2 trillion on Medicaid over the next five years. The administration projects that if all the changes it seeks were enacted, the federal government would save about $13 billion over those five years.