Medicaid Matters Weekly is a blog series aimed to be a trusted source for timely updates, insights and expert guidance on the ever-changing landscape of Medicaid, with a special focus on long-term care. Each week we’ll highlight critical developments, how they impact your clients, and offer practical tips to keep your planning strategies sharp and your clients protected.
A Breakdown of the LTC Medicaid Provisions Affected in the Bill
With the president’s desired July 4th deadline looming, the Senate narrowly passed Trump’s One Big Beautiful Bill on July 1, 2025, sending an amended version back to the House of Representatives for another vote. The vote was 50 to 50, with Vice President Vance casting the tie-breaker vote to confirm.
Now, the amended bill heads back to the House where no democrats are expected to vote in favor of it. Let’s take a look at the changes the Senate made, specifically those affecting long-term-care Medicaid.
1. Reporting Requirements – The current Medicaid program calls for Medicaid recipients to recertify annually. This recertification process is to prove that they have remained eligible and are still eligible for ongoing Medicaid payments. The House and Senate both would require recipients to recertify twice per year, rather than just annually going forward. This will impose burdens on not only applicants, but also the State agencies who are already struggling to keep up with applications and recertifications.
2. Home Equity Limits – Under both the House and Senate versions of the bill, Medicaid would cap home equity limits at a flat $1,000,000 and would not be adjusted for inflation going forward. Current limits range from $730,000 to $1,097,000.
3. Provider Taxes – Provider taxes are a rather complicated way that states decrease their share of Medicaid costs in favor of receiving more federal funds. The way it works is the state imposes taxes on health care providers. The funds raised from the taxes go toward the state’s share of costs. However, since the overall cost of care is raised by these taxes, that increases the FMAP (federal medical assistance percentage) – which is the amount of matched funds the federal government contributes toward each state.
The House bill aimed to freeze provider taxes at current rates, preventing states from establishing new (heightened) provider taxes. The Senate introduced a more complicated system – it wants to incrementally lower provider taxes from 6% to 3.5% by 2032, in expansion states (currently 40 states that expanded Medicaid under the Affordable Care Act). The reason expansion states are relevant is that the federal government covers 90% of the cost for expansion enrollees (and only 50-80% of non-expansion enrollees).
The Senate also introduced a new $25 billion fund that seeks to help rural hospitals, due to concern about them being most adversely affected by the changes to provider taxes.
4. Retroactive Medicaid Coverage – Currently, Medicaid allows a three-month retroactive window, allowing otherwise eligible applicants to receive benefits for the time three months prior to their application date. Both the House and Senate versions of the bill would limit this retroactive window to just 30 days.
5. Minimum Staffing Requirements – Biden-era legislation imposed minimum staffing requirements on skilled nursing facilities, in an effort to improve health outcomes and ultimately save lives. The House-passed bill prevented Medicaid from imposing those limits altogether, while the Senate scaled back the limitation ever so slightly. The Senate amended the bill to state the staffing requirements were not enforceable, but added “until October 1, 2034” allowing eventual imposition of the rules.
6. Home & Community Based Services – The House made no changes or references to current Home and Community Based Services (HCBS) programs. However, the Senate looks to allow states to expand their HCBS waiver programs to extend to applicants who do not need an institutional level of care, as currently required. The Senate’s amendment also includes $50 million and $100 million in federal funding to help states implement this expanded program in 2026 and 2027, respectively, with no new waivers being approved before July 1, 2028.
We will keep an eye on any changes not approved or further edited by the House in coming days. We will wait to see whether the House meets the president-imposed July 4th deadline. As changes continue to roll in, we will keep you updated because Medicaid Matters.
