Supplemental Spending Bill Includes Hospital Funding Increase

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Michigan Capitol BuildingThe Legislature passed a fiscal year (FY) 2020 supplemental spending bill that includes $50 million in new funding for Michigan hospitals through the first outpatient Medicaid fee increase since 2002.

The supplemental spending bill, approved March 12 in the House and Senate, also includes $25 million to support the COVID-19 response. It is unclear at this time where those funds will be directed. The MHA will continue to be in regular communication with members about COVID-19 following the announcement of the state’s first confirmed cases March 10.

The $50 million increase to hospital funding will need to be approved by the Centers for Medicare & Medicaid Services (CMS) before going into effect. Once approved, the rate increase will be paid to hospitals retroactively for services provided on or after April 1.

The MHA is currently engaged in advocacy efforts related to the Legislature’s final budget for FY 2021. The governor’s FY 2021 executive budget recommendation released in February included a 21.4% increase in outpatient Medicaid rates in FY 2021 paid for by an increase in state provider tax retention

The MHA will continue to keep members apprised as budget negotiations continue and the lawmakers respond to the COVID-19 pandemic. The MHA will work with legislators and state officials to ensure every Michigander continues to receive the highest quality healthcare in Michigan’s hospitals.  Members with questions may contact Adam Carlson at the MHA.