July 4, 2025
Funds

States snag $9 billion in Medicaid funds as GOP weighs new limits


Bob Herman covers health insurance, government programs, hospitals, physicians, and other providers — reporting on how money influences those businesses and shapes what we all pay for care. He is also the author of the Health Care Inc. newsletter. You can reach Bob on Signal at bobjherman.09.

Hospitals, physician groups, and nursing homes across 15 states will receive billions of dollars in extra Medicaid funding this year thanks to federal health care officials signing off on new agreements.

In almost all of the new agreements, states will pay health care providers average commercial prices to treat Medicaid patients — a boon for providers that often decry Medicaid as one of their worst-paying insurers.

The influx of recently approved Medicaid funds, known as state directed payment arrangements, highlights how the industry and state leaders of all political stripes have tapped a lucrative well within Medicaid. And the race is on to get more agreements across the finish line before Congress or the White House intervenes. 

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