PlainBillCongress, translated.Legislation. Context. Public interest.Referred to the House Committee on Energy and Commerce.
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People & committees
Rep. Davids, Sharice [D-KS-3] · D–KS
Legislative record
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Referred to the House Committee on Energy and Commerce.
Introduced in House
Introduced in House
Primary sources
Text links open the official source. We also preserved the text version used in the PlainBill explanation below.
No related bills are listed in this snapshot. This does not establish whether the proposal has appeared in earlier Congresses.
Source last updated: Oct 9, 2026. Consult Congress.gov for the current record.
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PlainBill explanation
Based on the full Introduced in House · 2026-10-05 text. This explanation has not received human editorial review. This overview describes the proposal’s major provisions; it does not establish what its real-world effects would be.
This proposal would change rules for certain Medicaid payments that states direct through managed-care health plans, affecting states, plans, and providers receiving those payments. It would establish a payment cap and transition rules, give states more flexibility in arranging payments, and require detailed payment reporting. It would also repeal two provisions concerning taxes on health care providers and cancel appropriations under one of them.
the total payment rate for such service is limited to 200 percent of the specified total published Medicare payment rate (or, in the absence of a specified total published Medicare payment rate, the average commercial rate in the State).
a State may condition such payment on the utilization and delivery of services outside of the rating period for which the State is seeking written prior approval and require that such payments be reconciled to utilization during such rating period
Beginning January 1, 2027, each State shall, not later than 1 year after the end of each rating period, submit to the Secretary through the Transformed Medicaid Statistical Information System (T–MSIS) (or a successor system) the data described in subparagraph (B), as a requirement for a State plan or State plan amendment that would provide for a State directed payment.
3. Repeal of provisions of Public Law 119–21 related to provider taxes (a) Repeal Sections 71115 and 71117 of Public Law 119–21 are repealed and section 1903(w) of the Social Security Act (42 U.S.C. 1396b(w)) shall be applied as if such sections had not been enacted. (b) Rescission The amounts appropriated under section 71115(c) of Public Law 119–21 are hereby rescinded.
The bill would require the Secretary of Health and Human Services to revise the specified payment regulation. For services furnished during payment-rating periods beginning on or after January 1, 2030, the total payment rate would be capped at 200 percent of the published Medicare payment benchmark, using the state's average commercial rate when no published Medicare rate exists.
The Secretary of Health and Human Services (in this section referred to as the Secretary) shall revise section 438.6(c)(2)(iii) of title 42, Code of Federal Regulations (or a successor regulation), such that, with respect to a payment described in such subsection made for a service furnished during a rating period beginning on or after January 1, 2030, the total payment rate for such service is limited to 200 percent of the specified total published Medicare payment rate (or, in the absence of a specified total published Medicare payment rate, the average commercial rate in the State).
Certain payments would qualify for a gradual transition to the cap. Eligibility would depend on written prior approval, or a good-faith effort to obtain approval as determined by the Secretary, before July 1, 2028, for the first rating period after that date; alternatively, a completed payment-request form called a preprint could have been submitted before this bill's enactment for that period. Starting with the rating period on or after January 1, 2030, qualifying payments would be reduced annually by 10 percent of the preceding period's payment until the specified rate was reached.
In the case of a payment described in section 438.6(c)(2)(iii) of title 42, Code of Federal Regulations (or a successor regulation), for which written prior approval (or a good faith effort to receive such approval, as determined by the Secretary) was made before July 1, 2028, for the first rating period occurring after July 1, 2028, or a payment so described for such rating period for which a completed preprint was submitted to the Secretary prior to the date of enactment of the Long-Term Rural Health Investment Act of 2026, beginning with the rating period on or after January 1, 2030, the total amount of such payment shall be reduced by 10 percent of the amount of any such payment made during the preceding rating period, each year until the total payment rate for such service is equal to the rate for such service specified in subsection (a).
For covered services in rating periods beginning on or after January 1, 2028, revised regulations would let states base payments on services used and delivered outside the period being approved. States could require those payments to be adjusted to reflect service use during the approved period.
The Secretary shall— (1) revise section 438.6(c)(2)(vii)(B) of title 42, Code of Federal Regulations (or a successor regulation), such that, with respect to a payment described in section 438.6(c)(2)(iii) of title 42, Code of Federal Regulations (or a successor regulation), made for services furnished during a rating period beginning on or after January 1, 2028, a State may condition such payment on the utilization and delivery of services outside of the rating period for which the State is seeking written prior approval and require that such payments be reconciled to utilization during such rating period
For covered services in rating periods beginning on or after January 1, 2028, revised regulations would let states withhold part of a plan's final payment rate to make the state-directed payment separately. States could also require Medicaid managed-care organizations and prepaid inpatient or ambulatory health plans to keep part of that rate separate to carry out the payment.
revise section 438.6(c)(6) of title 42, Code of Federal Regulations (or a successor regulation), such that, with respect to a payment described in section 438.6(c)(2)(iii) of title 42, Code of Federal Regulations (or a successor regulation), made for services furnished during a rating period beginning on or after January 1, 2028, a State may withhold a portion of the final capitation rate to pay a medicaid managed care organization, prepaid inpatient health plan, or prepaid ambulatory health plan separately for such payment and may require such an organization or plan to retain a portion of the final capitation rate separately to comply with such payment.
Beginning January 1, 2027, states would have to submit payment data to the Secretary through the federal Medicaid statistical reporting system within one year after each rating period ends. Reporting would be a requirement for a state plan or plan amendment providing for a state-directed payment.
Beginning January 1, 2027, each State shall, not later than 1 year after the end of each rating period, submit to the Secretary through the Transformed Medicaid Statistical Information System (T–MSIS) (or a successor system) the data described in subparagraph (B), as a requirement for a State plan or State plan amendment that would provide for a State directed payment.
Reports would include total state-directed spending by the covered health plans, identifying information specified by the Secretary, amounts paid to individual providers, and amounts the state collected to finance the nonfederal share, broken down by provider type.
(i) The total amount (in dollars) expended by a managed care organization, prepaid inpatient health plan, or prepaid ambulatory health plan for State directed payments during such rating period. (ii) Identifiers, as specified by the Secretary, for enrollees, providers, managed care organizations, prepaid inpatient health plans, and prepaid ambulatory health plans. (iii) Amounts paid to individual providers under a State directed payment. (iv) Amounts collected by the State to fund the non-Federal share of State directed payments, disaggregated by provider type.
Reports would also include procedure and diagnosis codes and the amounts allowed, billed, and paid for covered items or services. Payment information would distinguish the plan's negotiated payment, the state-directed payment, and any other amounts included in the provider's total payment.
(v) Procedure and diagnosis codes for any item or service for which a State directed payment was made. (vi) Amounts allowed, billed, and paid (including the amount that represents the payment amount negotiated by the relevant managed care organization, prepaid inpatient health plan, or prepaid ambulatory health plan, the amount of the State directed payment, and any other amounts included in the total amount paid to the provider) in connection with an item or service for which a State directed payment was made.
From enactment of section 2 through January 1, 2030, the Secretary would have to apply the specified payment regulation as it existed immediately before Public Law 119–21 was enacted.
For the period beginning on the date of enactment of this section and ending on January 1, 2030, the Secretary shall apply section 438.6(c)(2)(iii) of title 42, Code of Federal Regulations, as such section was in effect on the day before the date of enactment of Public Law 119–21.
Section 3 would repeal sections 71115 and 71117 of Public Law 119–21, identified in the bill as provider-tax provisions. It would require the referenced Social Security Act provision to operate as though those sections had not been enacted.
3. Repeal of provisions of Public Law 119–21 related to provider taxes (a) Repeal Sections 71115 and 71117 of Public Law 119–21 are repealed and section 1903(w) of the Social Security Act (42 U.S.C. 1396b(w)) shall be applied as if such sections had not been enacted.
The bill would cancel the amounts appropriated under section 71115(c) of Public Law 119–21. It does not state the dollar amount of that cancellation.
(b) Rescission The amounts appropriated under section 71115(c) of Public Law 119–21 are hereby rescinded.
The supplied actions snapshot, updated October 9, 2026, records introduction in the House and referral to the House Committee on Energy and Commerce on October 5, 2026.
Source snapshot updated 2026-10-09T20:38:26Z. 2026-10-05: Referred to the House Committee on Energy and Commerce. 2026-10-05: Introduced in House
A closer look
Reviewed version: Introduced in House · 2026-10-05. These findings describe provisions and who may benefit; they are not judgments of waste, corruption, or motive.
This review covers the supplied bill text. “None identified” does not rule out provisions in later versions or accompanying reports and disclosures.
Provisions outside the bill’s main subject, or policy changes attached to appropriations.
None identified in the reviewed text
No unrelated provision or policy rider was identified in the complete supplied introduced text. This conclusion is limited to that version and does not establish absence in other versions or accompanying materials.
Spending directed to particular recipients or places outside ordinary competitive or formula-based allocation.
None identified in the reviewed text
No congressionally directed spending for a particular recipient or place was identified in the complete supplied introduced text. This conclusion is limited to that version; formal earmark status cannot be determined for other versions or accompanying materials.
Narrow exceptions, exemptions, or preferential treatment that warrant a closer look.
Findings to examine
The supplied text includes a conditional transition exception within its main payment policy. This classification identifies special treatment, not a judgment about its merits.
Payments meeting specified prior-approval, good-faith-effort, or submission deadlines would receive a gradual transition to the new cap. This provides special transitional treatment for providers receiving qualifying payments, with annual reductions of 10 percent of the preceding period's amount until the required rate is reached.
In the case of a payment described in section 438.6(c)(2)(iii) of title 42, Code of Federal Regulations (or a successor regulation), for which written prior approval (or a good faith effort to receive such approval, as determined by the Secretary) was made before July 1, 2028, for the first rating period occurring after July 1, 2028, or a payment so described for such rating period for which a completed preprint was submitted to the Secretary prior to the date of enactment of the Long-Term Rural Health Investment Act of 2026, beginning with the rating period on or after January 1, 2030, the total amount of such payment shall be reduced by 10 percent of the amount of any such payment made during the preceding rating period, each year until the total payment rate for such service is equal to the rate for such service specified in subsection (a).
Full text preserved for this analysis. Legislative record snapshot: Oct 9, 2026. How PlainBill uses AI