Governors oppose rule that will end IGTs

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Governors are objecting to a pending rule from the Centers for Medicare & Medicaid Services that will eliminate intergovernmental transfers (IGTs), which help states compile more Medicaid funding.

IGTs, which are legal, allow states to pay more than the minimum cost of care to government-owned healthcare facilities, such as nursing homes. In turn, the state receives more matching federal funding. Last year, Congress placed a moratorium on the implementation of the rule, which is set to take effect in coming weeks. The rule will also cut federal Medicaid funding by an estimated $3.8 billion to public and other safety net providers over five years. Governors expressed opposition during their annual winter meeting, which began Saturday.

Also recently, CMS finalized a rule that will set the provider bed-tax limit at 5.5%. The bed tax, which affects all healthcare providers, is another mechanism by which states receive more federal Medicaid funding.