Medicaid Amendments

34
26B-3-109
26B-3-113
26B-3-207
26B-3-210
26B-3-506
26B-3-601
26B-3-606
26B-3-707
0
Medicaid Amendments
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Steve Eliason
Senate Sponsor: Keith Grover
LONG TITLE
General Description:
This bill amends provisions related to Medicaid.
Highlighted Provisions:
This bill:
defines terms;
changes the date Medicaid expansion will end if federal matching funds are reduced;
requires the Department of Health and Human Services (department) to end certain
programs that would lead to a reduction in federal matching funds for Medicaid
expansion if the state participated in the program;
requires the department to prepare a proposal if federal matching funds are reduced;
amends provisions related to the targeted adult Medicaid program; and
creates a reporting requirement.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
26B-3-109
Effective
05/06/26
, as renumbered and amended by Laws of Utah 2023,
Chapter 306
26B-3-113
Effective
05/06/26
, as last amended by Laws of Utah 2025, First Special
Session, Chapter 16
26B-3-207
Effective
05/06/26
, as last amended by Laws of Utah 2025, First Special
Session, Chapter 16
26B-3-210
Effective
05/06/26
, as last amended by Laws of Utah 2024, Chapters 250,
439
26B-3-506
Effective
05/06/26
Repealed
07/01/34
, as renumbered and amended by
Laws of Utah 2023, Chapter 306
26B-3-601
Effective
05/06/26
Repealed
07/01/34
, as last amended by Laws of Utah
2024, Chapter 439
26B-3-606
Effective
05/06/26
Repealed
07/01/34
, as renumbered and amended by
Laws of Utah 2023, Chapter 306
26B-3-707
Effective
05/06/26
Repealed
07/01/28
, as last amended by Laws of Utah
2024, Chapter 284
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
26B-3-109
is amended to read:
26B-3-109
Effective
05/06/26
. Medicaid expansion.
(1)
The purpose of this section is to expand the coverage of the Medicaid program to
persons who are in categories traditionally not served by that program.
(2)
Within appropriations from the Legislature, the department may amend the state plan
for medical assistance to provide for eligibility for Medicaid:
(a)
on or after July 1, 1994, for children 12 to 17 years old who live in households below
the federal poverty income guideline; and
(b)
on or after July 1, 1995, for persons who have incomes below the federal poverty
income guideline and who are aged, blind, or have a disability.
(3)
(a)
Within appropriations from the Legislature, on or after July 1, 1996, the Medicaid
program may provide for eligibility for persons who have incomes below the federal
poverty income guideline.
(b)
In order to meet the provisions of this subsection, the department may seek approval
for a demonstration project under 42 U.S.C. Sec. 1315 from the secretary of the
United States Department of Health and Human Services.
(4)
The Medicaid program shall provide for eligibility for
persons as required by
Subsection
26B-3-113(2)
individuals authorized to be enrolled in Medicaid under
Sections
26B-3-113
and
26B-3-210
.
(5)
Services available for persons described in this section shall include required Medicaid
services and may include one or more optional Medicaid services if those services are
funded by the Legislature. The department may also require persons described in
Subsections
(1)
through
(3)
to meet an asset test.
Section 2. Section
26B-3-113
is amended to read:
26B-3-113
Effective
05/06/26
. Expanding the Medicaid program.
(1)
As used in this section:
(a)
"Federal poverty level" means the same as that term is defined in Section
26B-3-207
.
(b)
"Medicaid ACA Fund" means the Medicaid ACA Fund created in Section
26B-1-315
.
(c)
"Medicaid expansion" means an expansion of the Medicaid program in accordance
with this section
and Section
26B-3-210
.
(2)
Subject to Section
26B-3-210
, the department has the authority to implement and
operate Medicaid expansion as approved by CMS and state law.
(2)
(a)
As set forth in Subsections
(2)
through
(5)
, eligibility criteria for the Medicaid
program shall be expanded to cover additional low-income individuals.
(b)
The department shall continue to seek approval from CMS to implement the
Medicaid waiver expansion as defined in Section
26B-3-210
.
(c)
The department may implement any provision described in Subsections
26B-3-210(2)(b)(iii) through (viii) in a Medicaid expansion if the department
receives approval from CMS to implement that provision.
(3)
The department shall expand the Medicaid program in accordance with this Subsection
(3)
if the department:
(a)
receives approval from CMS to:
(i)
expand Medicaid coverage to eligible individuals whose income is below 95% of
the federal poverty level;
(ii)
obtain maximum federal financial participation under 42 U.S.C. Sec. 1396d(b)
for enrolling an individual in the Medicaid expansion under this Subsection
(3)
;
and
(iii)
permit the state to close enrollment in the Medicaid expansion under this
Subsection
(3)
if the department has insufficient funds to provide services to new
enrollment under the Medicaid expansion under this Subsection
(3)
;
(b)
pays the state portion of costs for the Medicaid expansion under this Subsection
(3)

with funds from:
(i)
the Medicaid ACA Fund;
(ii)
county contributions to the nonfederal share of Medicaid expenditures; or
(iii)
any other contributions, funds, or transfers from a nonstate agency for Medicaid
expenditures; and
(c)
closes the Medicaid program to new enrollment under the Medicaid expansion
under this Subsection
(3)
if the department projects that the cost of the Medicaid
expansion under this Subsection
(3)
will exceed the appropriations for the fiscal year
that are authorized by the Legislature through an appropriations act adopted in
accordance with Title
63J, Chapter 1
, Budgetary Procedures Act.
(4)
(a)
The department shall expand the Medicaid program in accordance with this
Subsection
(4)
if the department:
(i)
receives approval from CMS to:
(A)
expand Medicaid coverage to eligible individuals whose income is below
95% of the federal poverty level;
(B)
obtain maximum federal financial participation under 42 U.S.C. Sec.
1396d(y) for enrolling an individual in the Medicaid expansion under this
Subsection
(4)
; and
(C)
permit the state to close enrollment in the Medicaid expansion under this
Subsection
(4)
if the department has insufficient funds to provide services to
new enrollment under the Medicaid expansion under this Subsection
(4)
;
(ii)
pays the state portion of costs for the Medicaid expansion under this Subsection
(4)
with funds from:
(A)
the Medicaid ACA Fund;
(B)
county contributions to the nonfederal share of Medicaid expenditures; or
(C)
any other contributions, funds, or transfers from a nonstate agency for
Medicaid expenditures; and
(iii)
closes the Medicaid program to new enrollment under the Medicaid expansion
under this Subsection
(4)
if the department projects that the cost of the Medicaid
expansion under this Subsection
(4)
will exceed the appropriations for the fiscal
year that are authorized by the Legislature through an appropriations act adopted
in accordance with Title
63J, Chapter 1
, Budgetary Procedures Act.
(b)
The department shall submit a waiver, an amendment to an existing waiver, or a
state plan amendment to CMS to:
(i)
administer federal funds for the Medicaid expansion under this Subsection
(4)

according to a per capita cap developed by the department that includes an annual
inflationary adjustment, accounts for differences in cost among categories of
Medicaid expansion enrollees, and provides greater flexibility to the state than the
current Medicaid payment model;
(ii)
limit, in certain circumstances as defined by the department, the ability of a
qualified entity to determine presumptive eligibility for Medicaid coverage for an
individual enrolled in a Medicaid expansion under this Subsection
(4)
;
(iii)
impose a lock-out period if an individual enrolled in a Medicaid expansion
under this Subsection
(4)
violates certain program requirements as defined by the
department;
(iv)
allow an individual enrolled in a Medicaid expansion under this Subsection
(4)

to remain in the Medicaid program for up to a 12-month certification period as
defined by the department; and
(v)
allow federal Medicaid funds to be used for housing support for eligible
enrollees in the Medicaid expansion under this Subsection
(4)
.
(5)
(3)
(a)
(i)
If CMS does not approve a waiver to expand the Medicaid program in
accordance with Subsection
(4)(a)
on or before January 1, 2020, the department
shall develop proposals to implement additional flexibilities and cost controls,
including cost sharing tools, within a Medicaid expansion under this Subsection
(5)
through a request to CMS for a waiver or state plan amendment.
(ii)
The request for a waiver or state plan amendment described in Subsection
(5)(a)(i)
shall include:
(A)
a path to self-sufficiency for qualified adults in the Medicaid expansion that
includes employment and training as defined in 7 U.S.C. Sec. 2015(d)(4); and
(B)
a requirement that an individual who is offered a private health benefit plan
by an employer to enroll in the employer's health plan.
(iii)
The department shall submit the request for a waiver or state plan amendment
developed under Subsection
(5)(a)(i)
on or before March 15, 2020.
(b)
Notwithstanding Sections
26B-3-127
and
63J-5-204
, and in accordance with this
Subsection
(5)
, eligibility for the Medicaid program shall be expanded to include all
persons in the optional Medicaid expansion population under PPACA and the Health
Care Education Reconciliation Act of 2010, Pub. L. No. 111-152, and related federal
regulations and guidance, on the earlier of:
(i)
the day on which CMS approves a waiver to implement the provisions described
in Subsections
(5)(a)(ii)(A)
and
(B)
; or
(ii)
July 1, 2020.
(c)
The department shall seek a waiver, or an amendment to an existing waiver, from
federal law to:
(i)
implement each provision described in Subsections
26B-3-210
(2)(b)(iii) through
(viii) in a Medicaid expansion under this Subsection
(5)
;
(ii)
limit, in certain circumstances as defined by the department, the ability of a
qualified entity to determine presumptive eligibility for Medicaid coverage for an
individual enrolled in a Medicaid expansion under this Subsection
(5)
; and
(iii)
impose a lock-out period if an individual enrolled in a Medicaid expansion
under this Subsection
(5)
violates certain program requirements as defined by the
department.
(d)
The eligibility criteria in this Subsection
(5)
shall be construed to include all
individuals eligible for the health coverage improvement program under Section
26B-3-207
.
(e)
(a)
The department shall pay the state portion of costs for
a
Medicaid expansion
under this Subsection
(5)

entirely from:
(i)
the Medicaid ACA Fund;
(ii)
county contributions to the nonfederal share of Medicaid expenditures; or
(iii)
any other contributions, funds, or transfers from a nonstate agency for Medicaid
expenditures.
(f)
(b)
If the costs of the Medicaid expansion
under this Subsection
(5)

exceed the
funds available under Subsection
(5)(e)
(3)(a)
:
(i)
the department may reduce or eliminate optional Medicaid services under this
chapter;
(ii)
savings, as determined by the department, from the reduction or elimination of
optional Medicaid services under Subsection
(5)(f)(i)
(3)(b)(i)
shall be deposited
into the Medicaid ACA Fund; and
(iii)
the department may submit to CMS a request for waivers, or an amendment of
existing waivers, from federal law necessary to implement budget controls within
the Medicaid program to address the deficiency.
(g)
(c)
If the costs of the Medicaid expansion
under this Subsection
(5)

are projected
by the department to exceed the funds available in the current fiscal year under
Subsection
(5)(e)
(3)(a)
, including savings resulting from any action taken under
Subsection
(5)(f)
(3)(b)
:
(i)
the governor shall direct the department and Department of Workforce Services to
reduce commitments and expenditures by an amount sufficient to offset the
deficiency:
(A)
proportionate to the share of total current fiscal year General Fund
appropriations for each of those agencies; and
(B)
up to 10% of each agency's total current fiscal year General Fund
appropriations;
(ii)
the Division of Finance shall reduce allotments to the department and Department
of Workforce Services by a percentage:
(A)
proportionate to the amount of the deficiency; and
(B)
up to 10% of each agency's total current fiscal year General Fund
appropriations; and
(iii)
the Division of Finance shall deposit the total amount from the reduced
allotments described in Subsection
(5)(g)(ii)
(3)(c)(ii)
into the Medicaid ACA
Fund.
(6)
(4)
The department shall maximize federal financial participation in implementing this
section, including by seeking to obtain any necessary federal approvals or waivers.
(7)
(5)
Notwithstanding Sections
17-77-201
and
17-77-301
, a county does not have to
provide matching funds to the state for the cost of providing Medicaid services to newly
enrolled individuals who qualify for Medicaid coverage under a Medicaid expansion.
(8)
(6)
The department shall report to the Social Services Appropriations Subcommittee on
or before November 1 of each year that a Medicaid expansion is operational:
(a)
the number of individuals who enrolled in the Medicaid expansion;
(b)
costs to the state for the Medicaid expansion;
(c)
estimated costs to the state for the Medicaid expansion for the current and following
fiscal years;
(d)
recommendations to control costs of the Medicaid expansion; and
(e)
as calculated in accordance with Subsections
26B-3-506(4)
and
26B-3-606(2)
, the
state's net cost of the
qualified
Medicaid expansion.
Section 3. Section
26B-3-207
is amended to read:
26B-3-207
Effective
05/06/26
. Health coverage improvement program --
Eligibility -- Annual report -- Expansion of eligibility for adults with dependent children.
(1)
As used in this section:
(a)
"Adult in the expansion population" means an individual who:
(i)
is described in 42 U.S.C. Sec. 1396a(a)(10)(A)(i)(VIII); and
(ii)
is not otherwise eligible for Medicaid as a mandatory categorically needy
individual.
(b)
"Enhancement waiver program" means the Primary Care Network enhancement
waiver program described in Section
26B-3-211
.
(c)
"Federal poverty level" means the poverty guidelines established by the Secretary of
the United States Department of Health and Human Services under 42 U.S.C. Sec.
9909(2).
(d)
"Health coverage improvement program" means the health coverage improvement
program described in Subsections
(3)
through
(9)
.
(e)
"Homeless":
(i)
means an individual who is chronically homeless, as determined by the
department; and
(ii)
includes someone who was chronically homeless and is currently living in
supported housing for the chronically homeless.
(f)
"Income eligibility ceiling" means the percent of federal poverty level:
(i)
established by the state in an appropriations act
ado
pted

pursuant
to
Title 63J,
Chapter 1, Budgetary Procedures Act
; and
(ii)
under which an individual may qualify for Medicaid coverage in accordance with
this section.
(g)
"Targeted adult Medicaid program" means the program implemented by the
department under Subsections
(5)
through
(7)
.
(2)
Beginning July 1, 2016, the department shall amend the state Medicaid plan to allow
temporary residential treatment for substance use, for the traditional Medicaid
population, in a short term, non-institutional, 24-hour facility, without a bed capacity
limit that provides rehabilitation services that are medically necessary and in accordance
with an individualized treatment plan, as approved by CMS and as long as the county
makes the required match under Section
17-77-201
.
(3)
Beginning July 1, 2016, the department shall amend the state Medicaid plan to increase
the income eligibility ceiling to a percentage of the federal poverty level designated by
the department, based on appropriations for the program, for an individual with a
dependent child.
(4)
Before July 1, 2016, the division shall submit to CMS a request for waivers, or an
amendment of existing waivers, from federal statutory and regulatory law necessary for
the state to implement the health coverage improvement program in the Medicaid
program in accordance with this section.
(5)
(a)
An adult in the expansion population is eligible for Medicaid if the adult meets the
income eligibility and other criteria established under Subsection
(6)
.
(b)
An adult who qualifies under Subsection
(6)
shall receive Medicaid coverage:
(i)
through the traditional fee for service Medicaid model in counties without
Medicaid accountable care organizations or the state's Medicaid accountable care
organization delivery system, where implemented and subject to Section
26B-3-223
;
(ii)
except as provided in Subsection
(5)(b)(iii)
, for behavioral health, through the
counties in accordance with Sections
17-77-201
and
17-77-301
;
(iii)
that, subject to Section
26B-3-223
, integrates behavioral health services and
physical health services with Medicaid accountable care organizations in select
geographic areas of the state that choose an integrated model; and
(iv)
that permits temporary residential treatment for substance use in a short term,
non-institutional, 24-hour facility, without a bed capacity limit, as approved by
CMS, that provides rehabilitation services that are medically necessary and in
accordance with an individualized treatment plan.
(6)
(a)
An individual is eligible for the health coverage improvement program under
Subsection
(5)
if:
(i)
at the time of enrollment, the individual's annual income is below the income
eligibility ceiling established by the state under Subsection
(1)(f)
; and
(ii)
the individual meets the eligibility criteria established by the department under
Subsection
(6)(b)
.
(b)
Based on available funding and approval from CMS, the department shall select the
criteria for an individual to qualify for the Medicaid program under Subsection
(6)(a)(ii)
, based on the following priority:
(i)
a chronically homeless individual;
(ii)
if funding is available, an individual:
(A)
involved in the justice system through probation, parole, or court ordered
treatment; and
(B)
in need of substance use treatment or mental health treatment, as determined
by the department; or
(iii)
if funding is available, an individual in need of substance use treatment or mental
health treatment, as determined by the department.
(c)
An individual who qualifies for Medicaid coverage under Subsections
(6)(a)
and
(b)

may remain on the Medicaid program for a 12-month certification period as defined
by the department. Eligibility changes made by the department under Subsection
(1)(f)
or
(6)(b)
shall not apply to an individual during the 12-month certification
period.
Subject to Subsection
(6)(d)
, if approved by CMS:
(i)
an individual who qualifies for Medicaid coverage under Subsections
(6)(a)
and
(b)

may remain on the Medicaid program for a certification period not to exceed 12
months; and
(ii)
eligibility changes made by the department under Subsection
(1)(f)
or
(6)(b)
do
not apply to an individual during the certification period.
(d)
(i)
The department may not seek approval from CMS to implement Subsection
(6)(c)
unless the executive director determines that CMS is likely to approve a
waiver described in Subsection
(6)(c)
.
(ii)
If the executive director determines CMS is likely to approve a waiver described
in Subsection
(6)(c)
, the department shall apply for the waiver within 120 days of
the determination.
(iii)
When applying for the waiver, the department may alter the length of the
certification period described in Subsection
(6)(c)(i)
as necessary to obtain the
waiver if the length of the certification period does not exceed 12 months.
(7)
The state may request a modification of the income eligibility ceiling and other
eligibility criteria under Subsection
(6)
each fiscal year based on projected enrollment,
costs to the state, and the state budget.
(8)
The current Medicaid program and the health coverage improvement program, when
implemented, shall coordinate with a state prison or county jail to expedite Medicaid
enrollment for an individual who is released from custody and was eligible for or
enrolled in Medicaid before incarceration.
(9)
Notwithstanding Sections
17-77-201
and
17-77-301
, a county does not have to provide
matching funds to the state for the cost of providing Medicaid services to newly enrolled
individuals who qualify for Medicaid coverage under the health coverage improvement
program under Subsection
(6)
.
(10)
If the enhancement waiver program is implemented, the department:
(a)
may not accept any new enrollees into the health coverage improvement program
after the day on which the enhancement waiver program is implemented;
(b)
shall transition all individuals who are enrolled in the health coverage improvement
program into the enhancement waiver program;
(c)
shall suspend the health coverage improvement program within one year after the
day on which the enhancement waiver program is implemented;
(d)
shall, within one year after the day on which the enhancement waiver program is
implemented, use all appropriations for the health coverage improvement program to
implement the enhancement waiver program; and
(e)
shall work with CMS to maintain any waiver for the health coverage improvement
program while the health coverage improvement program is suspended under
Subsection
(10)(c)
.
(11)
If, after the enhancement waiver program takes effect, the enhancement waiver
program is repealed or suspended by either the state or federal government, the
department shall reinstate the health coverage improvement program and continue to
accept new enrollees into the health coverage improvement program in accordance with
the provisions of this section.
Section 4. Section
26B-3-210
is amended to read:
26B-3-210
Effective
05/06/26
. Medicaid expansion.
(1)
As used in this section:
(a)
"Adult in the expansion population" means an individual who:
(i)
is described in 42 U.S.C. Sec. 1396a(a)(10)(A)(i)(VIII); and
(ii)
is not otherwise eligible for Medicaid as a mandatory categorically needy
individual.
(b)
"Discrete program" means a program or benefit that:
(i)
can be closed or ended with minimal impact on other state programs; and
(ii)
receives less than $50 million in state funds annually.
(c)
"Expansion FMAP" means the Federal Medical Assistance Percentage described in
42 U.S.C. Sec. 1396d(y).
(d)
"Federal poverty level" means the same as that term is defined in Section
26B-3-207
.
(b)
(e)
"Medicaid
waiver
expansion"
means an expansion of the Medicaid program in
accordance with this section
means the same as that term is defined in Section
26B-3-113
.
(2)
(a)
Before January 1, 2019, the department shall apply to CMS for approval of a
waiver or state plan amendment to implement the Medicaid waiver expansion.
(b)
The
Medicaid
waiver
expansion shall:
(i)
(a)
expand Medicaid coverage to eligible individuals whose income is below
95%
133%
of the federal poverty level;
(ii)
(b)
obtain maximum
federal financial participation under 42 U.S.C. Sec. 1396d(y)
expansion FMAP
for enrolling an individual in the Medicaid program;
(iii)
(c)
provide Medicaid benefits through the state's Medicaid accountable care
organizations in areas where a Medicaid accountable care organization is
implemented;
(iv)
(d)
integrate the delivery of behavioral health services and physical health services
with Medicaid accountable care organizations in select geographic areas of the state
that choose an integrated model;
(v)
(e)
include a path to self-sufficiency, including work activities as defined in 42
U.S.C. Sec. 607(d), for qualified adults;
(vi)
(f)
require an individual who is offered a private health benefit plan by an employer
to enroll in the employer's health plan;
(vii)
(g)
sunset in accordance with Subsection
(5)(a)
(4)(a)
;
and
(viii)
(h)
permit the state to close enrollment in the Medicaid waiver expansion if the
department has insufficient funding to provide services to additional eligible
individuals
.
; and
(i)
if approved by CMS:
(i)
administer federal funds for Medicaid expansion according to a per capita cap
developed by the department that includes an annual inflationary adjustment,
accounts for differences in cost among categories of Medicaid expansion
enrollees, and provides greater flexibility to the state than the current Medicaid
payment model;
(ii)
limit, in certain circumstances as defined by the department, the ability of a
qualified entity to determine presumptive eligibility for Medicaid coverage for an
individual enrolled in Medicaid expansion;
(iii)
impose a lock-out period if an individual enrolled in Medicaid expansion violates
certain program requirements as defined by the department;
(iv)
allow an individual enrolled in Medicaid expansion to remain in the Medicaid
program for up to a 12-month certification period as defined by the department;
and
(v)
allow federal Medicaid funds to be used for housing support for eligible enrollees
in Medicaid expansion.
(3)
If the Medicaid waiver described in Subsection (2)(a) is approved, the department may
only pay the state portion of costs for the Medicaid waiver expansion with
appropriations from:
(a)
the Medicaid ACA Fund, created in Section
26B-1-315
;
(b)
county contributions to the non-federal share of Medicaid expenditures; and
(c)
any other contributions, funds, or transfers from a non-state agency for Medicaid
expenditures.
(4)
(3)
(a)
In consultation with the department, Medicaid accountable care organizations
and counties that elect to integrate care under Subsection
(2)(b)(iv)
(2)(d)
shall
collaborate on enrollment, engagement of patients, and coordination of services.
(b)
As part of the provision described in Subsection
(2)(b)(iv)
(2)(d)
, the department
shall apply for a waiver to permit the creation of an integrated delivery system:
(i)
for any geographic area that expresses interest in integrating the delivery of
services under Subsection
(2)(b)(iv)
(2)(d)
; and
(ii)
in which the department:
(A)
may permit a local mental health authority to integrate the delivery of
behavioral health services and physical health services;
(B)
may permit a county, local mental health authority, or Medicaid accountable
care organization to integrate the delivery of behavioral health services and
physical health services to select groups within the population that are newly
eligible under the Medicaid waiver expansion; and
(C)
may make rules in accordance with Title
63G, Chapter 3
, Utah Administrative
Rulemaking Act, to integrate payments for behavioral health services and
physical health services to plans or providers.
(5)
(4)
(a)
If
federal financial participation for the Medicaid waiver expansion is
reduced below 90%
the expansion FMAP rate is reduced below 90%
, the authority of
the department to implement
the
Medicaid
waiver
expansion shall sunset
no later
than the next July 1 after the date on which the federal financial participation is
reduced.
on the day after the day the Legislature adjourns sine die from the General
Legislative Session that occurs after the date on which the expansion FMAP rate is
reduced below 90%.
(b)
The department shall commence the process of terminating the Medicaid expansion
waiver and making system changes to implement the termination beginning on the
day Medicaid expansion authority sunsets under Subsection
(4)(a)
.
(c)
Notwithstanding any provision of law, if the department operates or is involved in a
discrete program that will cause the expansion FMAP rate to be reduced for adults in
the expansion population and ceasing involvement or terminating the program would
avoid the rate reduction, the department shall cease any involvement in or terminate
the discrete program causing the reduction before the state would experience the first
reduction in expansion FMAP rate.
(d)
(i)
Within 60 days from the day of a state determination that the expansion FMAP
rate will be reduced below 90%, the department shall create a proposal that
outlines options for how the department may maintain Medicaid expansion within
projected funding.
(ii)
The department shall submit the proposal to the Governor's Office of Planning
and Budget, the Office of the Legislative Fiscal Analyst, the Social Services
Appropriations Subcommittee, and the Executive Appropriations Committee.
(iii)
The department's proposal shall consider the following cost containment efforts
to the extent allowed by federal rules and regulations:
(A)
reducing Medicaid expansion administrative costs, including suspending
hiring of noncritical employees and suspending increasing employee wages,
excluding employee benefits offered to employees state-wide;
(B)
suspending increases to provider payment rates that would be paid for using
general funds or income tax funds;
(C)
reversing provider payment rate increases approved or implemented during
the one-year period immediately before the day of the state determination that
the expansion FMAP rate is reduced if the rate increase is paid for using
general funds or income tax funds;
(D)
suspending the expansion of benefits that are paid for using general funds or
income tax funds;
(E)
eliminating coverage for optional services that are paid for using general funds
or income tax funds;
(F)
eliminating coverage for optional populations included in Medicaid expansion;
and
(G)
closing enrollment to new members.
(b)
(e)
The department shall close the program to new enrollment if the cost of
the
Medicaid
waiver
expansion is projected to exceed the appropriations for the fiscal
year that are authorized by the Legislature through an appropriations act adopted in
accordance with Title
63J, Chapter 1
, Budgetary Procedures Act.
(f)
If the authority for Medicaid expansion sunsets, not more than 90 days after the day
the authority sunsets, the department and the Governor's Office of Planning and
Budget shall provide recommendations to the Executive Appropriations Committee
regarding how any remaining funds in the Medicaid ACA Fund, created in Section
26B-1-315
, should be used.
Section 5. Section
26B-3-506
is amended to read:
26B-3-506
Effective
05/06/26
Repealed
07/01/34
. Hospital financing of health
coverage improvement program Medicaid waiver expansion -- Hospital share.
(1)
The hospital share is:
(a)
45% of the state's net cost of the health coverage improvement program, including
Medicaid coverage for individuals with dependent children up to the federal poverty
level designated under Section
26B-3-207
;
(b)
45% of the state's net cost of the enhancement waiver program;
(c)
if the waiver for the Medicaid waiver expansion is approved, $11,900,000; and
(d)
45% of the state's net cost of the upper payment limit gap.
(2)
(a)
The hospital share is capped at no more than $13,600,000 annually, consisting of:
(i)
an $11,900,000 cap for the programs specified in Subsections
(1)(a)
through
(c)
;
and
(ii)
a $1,700,000 cap for the program specified in Subsection
(1)(d)
.
(b)
The department shall prorate the cap described in Subsection
(2)(a)
in any year in
which the programs specified in Subsections
(1)(a)
and
(d)
are not in effect for the
full fiscal year.
(3)
Private hospitals shall be assessed under this part for:
(a)
69% of the portion of the hospital share for the programs specified in Subsections
(1)(a)
through
(c)
; and
(b)
100% of the portion of the hospital share specified in Subsection
(1)(d)
.
(4)
(a)
In the report described in Subsection
26B-3-113(8)
26B-3-113(6)
, the department
shall calculate the state's net cost of each of the programs described in Subsections
(1)(a)
through
(c)
that are in effect for that year.
(b)
If the assessment collected in the previous fiscal year is above or below the hospital
share for private hospitals for the previous fiscal year, the underpayment or
overpayment of the assessment by the private hospitals shall be applied to the fiscal
year in which the report is issued.
(5)
A Medicaid accountable care organization shall, on or before October 15 of each year,
report to the department the following data from the prior state fiscal year for each
private hospital, state teaching hospital, and non-state government hospital provider that
the Medicaid accountable care organization contracts with:
(a)
for the traditional Medicaid population:
(i)
hospital inpatient payments;
(ii)
hospital inpatient discharges;
(iii)
hospital inpatient days; and
(iv)
hospital outpatient payments; and
(b)
if the Medicaid accountable care organization enrolls any individuals in the health
coverage improvement program, the enhancement waiver program, or the Medicaid
waiver expansion, for the population newly eligible for any of those programs:
(i)
hospital inpatient payments;
(ii)
hospital inpatient discharges;
(iii)
hospital inpatient days; and
(iv)
hospital outpatient payments.
(6)
The department shall, by rule made in accordance with
Title 63G, Chapter 3, Utah
Administrative Rulemaking Act
, provide details surrounding specific content and format
for the reporting by the Medicaid accountable care organization.
Section 6. Section
26B-3-601
is amended to read:
26B-3-601
Effective
05/06/26
Repealed
07/01/34
. Definitions.
As used in this part:
(1)
"Assessment" means the Medicaid expansion hospital assessment established by this
part.
(2)
"CMS" means the Centers for Medicare and Medicaid Services within the United States
Department of Health and Human Services.
(3)
"Discharges" means the number of total hospital discharges reported on:
(a)
Worksheet S-3 Part I, column 15, lines 14, 16, and 17 of the 2552-10 Medicare cost
report for the applicable assessment year; or
(b)
a similar report adopted by the department by administrative rule, if the report under
Subsection
(3)(a)
is no longer available.
(4)
"Division" means the Division of Integrated Healthcare within the department.
(5)
"Hospital share" means the hospital share described in Section
26B-3-605
.
(6)
"Medicaid accountable care organization" means a managed care organization, as
defined in 42 C.F.R. Sec. 438, that contracts with the department under the provisions of
Section
26B-3-202
.
(7)
"Medicaid ACA Fund" means the Medicaid ACA Fund created in Section
26B-1-315
.
(8)
"Medicaid waiver expansion" means the same as that term is defined in Section
26B-3-210
.
(9)
"Medicare cost report" means CMS-2552-10, the cost report for electronic filing of
hospitals.
(10)
(a)
"Non-state government hospital" means a hospital owned by a non-state
government entity.
(b)
"Non-state government hospital" does not include:
(i)
the Utah State Hospital; or
(ii)
a hospital owned by the federal government, including the Veterans
Administration Hospital.
(11)
(a)
"Private hospital" means:
(i)
a privately owned general acute hospital operating in the state as defined in
Section
26B-2-201
; or
(ii)
a privately owned specialty hospital operating in the state, including a privately
owned hospital for which inpatient admissions are predominantly:
(A)
rehabilitation;
(B)
psychiatric;
(C)
chemical dependency; or
(D)
long-term acute care services.
(b)
"Private hospital" does not include a facility for residential treatment as defined in
Section
26B-2-101
.
(12)
"Qualified Medicaid expansion" means an expansion of the Medicaid program in
accordance with Subsection
26B-3-113
(5).
(13)
(12)
"State teaching hospital" means a state owned teaching hospital that is part of an
institution of higher education.
Section 7. Section
26B-3-606
is amended to read:
26B-3-606
Effective
05/06/26
Repealed
07/01/34
. Hospital financing.
(1)
Private hospitals shall be assessed under this part for the portion of the hospital share
described in Section
26B-3-611
.
(2)
In the report described in Subsection
26B-3-113(8)
26B-3-113(6)
, the department shall
calculate the state's net cost of
the qualified
Medicaid expansion.
(3)
If the assessment collected in the previous fiscal year is above or below the hospital
share for private hospitals for the previous fiscal year, the division shall apply the
underpayment or overpayment of the assessment by the private hospitals to the fiscal
year in which the report is issued.
Section 8. Section
26B-3-707
is amended to read:
26B-3-707
Effective
05/06/26
Repealed
07/01/28
. Medicaid hospital
adjustment under Medicaid accountable care organization rates.
(1)
To preserve and improve access to hospital services, the division shall incorporate into
the Medicaid accountable care organization rate structure calculation consistent with the
certified actuarial rate range:
(a)
$154,000,000 to be allocated toward the hospital inpatient directed payments for the
Medicaid eligibility categories covered in Utah before January 1, 2019; and
(b)
within available funds,
an amount equal to the difference between payments made to
hospitals by Medicaid accountable care organizations for the Medicaid eligibility
categories covered in Utah, based on submitted encounter data, and the maximum
amount that could be paid for those services, to be used for directed payments to
hospitals for inpatient and outpatient services.
(2)
(a)
To preserve and improve the quality of inpatient and outpatient hospital services
authorized under Subsection
(1)(b)
, the division shall amend its quality strategies
required by 42 C.F.R. Sec. 438.340 to include quality measures selected from the
CMS hospital quality improvement programs.
(b)
To better address the unique needs of rural and specialty hospitals, the division may
adopt different quality standards for rural and specialty hospitals.
(c)
The division shall make rules in accordance with Title
63G, Chapter 3
, Utah
Administrative Rulemaking Act, to adopt the selected quality measures and prescribe
penalties for not meeting the quality standards that are established by the division by
rule.
(d)
The division shall apply the same quality measures and penalties under this
Subsection
(2)
to new directed payments made to the University of Utah Hospital and
Clinics.
Section 9.
Effective Date.
This bill takes effect on
May 6, 2026
.
3-10-26 3:13 PM