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Health-care-related Taxes: Medicaid MCO Compliance with Hold-Harmless Requirement

Many States finance a portion of their Medicaid spending by imposing taxes on health care providers. A health-care-related tax is permissible if the tax, among other standards, avoids hold-harmless arrangements which return collected taxes directly or indirectly to taxpayers. OIG currently is reviewing State tax programs for hospitals and nursing homes to test for compliance with the hold-harmless requirement. We will determine if health-care-related tax programs for managed care organizations (MCOs) meet Federal hold-harmless requirements in 42 CFR § 433.68 by examining the tax programs in large States that tax MCOs.

Announced or Revised Agency Title Component Report Number(s) Expected Issue Date (FY)
Nov-16 Centers for Medicare & Medicaid Services Health-care-related Taxes: Medicaid MCO Compliance with Hold-Harmless Requirement Office of Audit Services W-00-17-31515 2018