A bill to amend title XIX of the Social Security Act to clarify the circumstances under which a hold harmless provision does not exist with respect to a broad-based health care related tax.

Amends title XIX (Medicaid) of the Social Security Act (SSA) with respect to the determination of the amount to be paid to a State, in particular the reduction of the total medical assistance the State expended during a fiscal year by any revenues the State or local government receives from a broad-based health care related tax (such as a provider assessment program, or tax on hospitals) if a hold harmless provision is in effect with respect to the tax. (Current law declares that such a hold harmless provision is in effect if the Secretary of Health and Human Services determines that the State or local government imposing the tax provides even indirectly for any payment, offset, or waiver that guarantees to hold taxpayers harmless for any portion of the costs of the tax; in effect, a guarantee that a taxpaying hospital will receive back from Medicaid the amount of funds the hospital paid to the State in provider taxes.) Declares that the State shall not be considered to have provided an indirect guarantee to hold taxpayers harmless (and so the Federal Medicaid payment to the State shall not be determined upon a total State Medicaid expenditure that is reduced by the amount of provider taxes) if the tax is applied at a rate that produces revenues that do not exceed six percent of the revenues received by the taxpayers (hospitals) for the fiscal year involved.