Trump administration rejects California’s healthcare tax

The Trump administration says it will not allow California to collect a key health-care tax on managed-care organizations, a decision that could cost the state nearly $2 billion a year for low-income benefits.

The news does not immediately affect California’s budget because the state did not plan to receive that money this year or the budget year that begins July 1. But it could cost California $1.2 billion in the fiscal year that begins July 1, 2021, California Department of Finance spokesman H.D. Palmer said. That number increases to $1.9 billion after that.

“The Administration will continue its ongoing discussions with federal Medicaid officials on this issue,” Palmer said. “Consistent with the federal government’s prior approvals of similar financing waivers, we believe and expect that we can reach an agreement that allows this type of financing to continue.”

Click here to read the full article from Modern Healthcare

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