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Association Urges CMS to Withdraw the MFAR

In comments submitted Jan. 31, America’s Essential Hospitals urged the Centers for Medicare & Medicaid Services (CMS) to withdraw in its entirety the proposed Medicaid Fiscal Accountability Regulation (MFAR).

The MFAR proposed rule would significantly impact how states finance the nonfederal share of their Medicaid programs by instituting more rigorous requirements on Medicaid supplemental payments and the arrangements between states, other governmental entities, and providers to finance these payments. The rule also would impose quarterly and annual provider-level state reporting requirements related to the sources of supplemental payment financing and the amounts paid to providers.

In its comments, the association outlined overarching and specific problems with the MFAR that necessitate its withdrawal. The rule threatens longstanding arrangements states rely on to finance their share of the Medicaid program and would undermine the state role in Medicaid by granting the federal government broad, arbitrary discretion to limit states’ ability to fund their own programs. The association is concerned that provisions are broad, sweeping, and impossibly vague, giving states no reliable standards on which to structure their financing arrangements with any level of certainty. Last, CMS appears to have issued this rule without any meaningful analysis of its impact on states, providers, and — most important — Medicaid beneficiaries.

In addition to submitting comments, the association issued a release reiterating the need for CMS to withdraw this damaging regulation.

Contact Senior Director of Policy Erin O’Malley at or 202.585.0127 with questions.


About the Author

Zina Gontscharow is a former senior policy analyst for America's Essential Hospitals.

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