Regents briefed on federal Medicaid cuts in final reconciliation law and potential impacts on UC Health

University of California federal and health policy staff told the Health Services Committee that the federal reconciliation law signed July 4 makes the single largest cut to Medicaid in history and will materially affect UC Health and California hospitals through multiple mechanisms, including freezing and phasing down state-directed payments, changing provider tax rules and imposing new eligibility and reporting requirements.

“[The reconciliation bill] makes the largest cut to Medicaid in history by cutting spent Medicaid spending by a trillion dollars over a decade,” Tam Maher, AVP of Health Policy and Regulatory Affairs, said during the federal policy update. Kent Springfield, director of health and clinical affairs in federal government relations, described UC advocacy efforts in the preceding months to educate members of Congress and oppose proposals that would have worsened the impact.

Why it matters: UC hospitals rely heavily on Medi‑Cal supplemental and directed payments and on certain state provider taxes to finance…