Long-Term Rural Health Investment Act of 2026
Sponsored By: Representative Davids, Sharice [D-KS-3]
Introduced
Summary
Caps state-directed Medicaid payments at 200% of Medicare or the State’s average commercial rate. This bill would reshape how states design and report state-directed payments, add tighter definitions and reconciliation rules, and undo recent provider-tax provisions.
Show full summary
- States would face a hard cap on state-directed payments at 200% of a specified Medicare rate or the state-average commercial rate. Grandfathered payments would be reduced by 10% each year until they meet the new cap.
- Medicaid managed care organizations, prepaid inpatient health plans, and prepaid ambulatory health plans would see new payment mechanics. The bill would let states withhold part of a final capitation rate to pay an SDP separately and require reconciliation tied to historical utilization.
- States would have to submit detailed SDP data to the Transformed Medicaid Statistical Information System (T-MSIS) beginning in 2027, within one year after each rating period. Required data include total SDP dollars, provider and enrollee identifiers, amounts paid to providers, and procedure and diagnosis codes. The bill would also repeal provider-tax provisions from Public Law 119-21 and rescind the related appropriation.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 0 benefits, 1 costs, 3 mixed.
Caps and phase-down for Medicaid payments
If enacted, the bill would cap certain State-directed Medicaid payments at 200% of a benchmark rate for services in rating periods starting January 1, 2030. The benchmark would be the published total Medicare rate when available or the State’s average commercial rate if no Medicare rate exists. If enacted, previously approved qualifying payments (or those with completed preprints or good-faith prior-approval efforts by specified cutoffs) would be reduced by 10% each year starting with rating periods on or after January 1, 2030 until they match the new cap.
States get more control over payments
If enacted, the bill would let States condition State-directed payments on service use outside the rating period for which approval is sought and require reconciliation to actual use during the rating period. If enacted, the bill would let States withhold part of a plan’s final capitation rate and pay the State-directed amount separately, while requiring plans to retain a portion separately to comply. If enacted, the bill would also require the Secretary to apply an earlier version of the relevant Medicaid rule from enactment through January 1, 2030.
Repeal Medicaid provider-tax rules
If enacted, the bill would repeal sections 71115 and 71117 of Public Law 119-21 and direct that section 1903(w) of the Social Security Act be applied as if those sections had not been enacted. The repeal would take effect on enactment. If enacted, the bill would also rescind the amounts appropriated under section 71115(c) of Public Law 119-21.
New reporting rules for Medicaid payments
If enacted, each State would have to submit detailed State-directed payment data starting January 1, 2027. If enacted, reports would be due within one year after each rating period and sent through the Transformed Medicaid Statistical Information System (T-MSIS). The data would include total SDP spending; identifiers for enrollees, providers, and plans; amounts paid to individual providers; State collections for the non-Federal share by provider type; procedure and diagnosis codes; and amounts allowed, billed, and paid.
Sponsors & CoSponsors
Sponsor
Davids, Sharice [D-KS-3]
KS • D
Cosponsors
There are no cosponsors for this bill.
Roll Call Votes
No roll call votes available for this bill.
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