Michigan Gov. Gretchen Whitmer signed legislation Oct. 7 that aims to preserve the state’s Medicaid funding by maintaining its Insurance Provider Assessment tax.
The new law instructs the state to request a waiver from CMS to continue the tax on insurers at current rates, which generates approximately $630 million annually and helps the state qualify for roughly $1.75 billion in federal matching funds for Medicaid.
If the waiver is altered or terminated by CMS, the state will propose a new tax structure to comply with updated federal regulations.
In July, President Donald Trump signed the “One Big Beautiful Bill Act,” which gradually lowers the maximum cap on Medicaid provider taxes in expansion states and introduces work requirements for Medicaid recipients in 2027.
