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AHS tells House Appropriations HR 1 will shift Medicaid funding and reduce provider-tax revenue
Summary
Agency of Human Services officials told the House Appropriations Committee that HR 1 will bar federal Medicaid reimbursements to Planned Parenthood for a year (the state will backfill with general fund), cap and step down provider taxes with multi‑year general‑fund impacts, limit state‑directed payments to Medicare rates, and require more CMS guidance before implementing cost‑sharing changes.
The House Appropriations Committee on Jan. 14 heard Agency of Human Services officials warn that HR 1, the federal budget reconciliation bill passed July 4, 2025, will materially change how Vermont pays for Medicaid and could reduce state revenues. Agency witnesses described an immediate one‑year prohibition on federal Medicaid reimbursements to Planned Parenthood, a multiyear step‑down of hospital provider taxes, new limits on state‑directed payments and a future requirement for expanded cost sharing.
"HR 1, which is the big, beautiful bill that was passed on 07/04/2025," said Ashley Berliner, director of Medicaid policy for the Agency of Human Services, as she outlined the law's main provisions for the committee. Berliner said the first provision to take effect barred Planned Parenthood and similar entities from receiving federal Medicaid reimbursement for one year and that the agency has chosen to "backfill all of the lost federal financial participation with state general fund." She told the…
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