Medicare’s fee-for-service (FFS) payment system includes payment policies that support providers’ use of innovative medical device technologies. The continued evolution of these policies is necessary to keep pace with current and future medical innovation. In this report, HMA summarizes models testing the implementation of a newly proposed policy for the hospital inpatient system which aims to eliminate systemic bias that may slow hospitals’ adoption of innovative technologies. HMA concludes that targeted policies that eliminate the use of the hospital wage index to standardize device costs can result in more accurate reimbursement for hospitals and increase beneficiary access to innovative technologies.
1069 Results found.
HMA helps navigate dQM to improve health outcomes
The healthcare industry is undergoing a seismic shift in how quality data are collected and reported, creating opportunities to use digital quality measures (dQM) to significantly improve health outcomes and efficiency. Starting in January 2027, new federal interoperability and prior authorization rules will promote widespread data exchange, enabling full digital quality measurement. Payers and providers must invest early to be well-positioned to undergo major strategic and operational changes to optimize healthcare data and transform their business processes.
This issue brief explains the federal policies and national changes that make digital quality measurement possible, explores challenges facing the health insurance industry, and highlights opportunities for payers and providers.
Our HMA dQM team helps health plans, providers, health & hospital systems, federal, state and local payers such as Medicare and Medicaid navigate the transformation to dQM and broader interoperability—from early planning through strategy development, implementation, and impact evaluation.
Highlights from HMA Analysis of Specialty Services in Medicaid
This week, our In Focus section highlights key insights from a new Health Management Associates (HMA), white paper, Concentration of Specialty Services in Medicaid. Experts from HMA and Wakely, an HMA company, used the national Transformed Medicaid Statistical Information System (T-MSIS) database to learn more about specialty provider networks and examine the provision of specialty services across various states.
The analysis, released in January 2025 with support from the Robert Wood Johnson Foundation, focuses on three representative services that are relatively common, potentially difficult for Medicaid beneficiaries to access, significantly affect quality of life, typically accessed as elective procedures, and unlikely to be provided by other clinicians, such as primary care or mid-level practitioners.
T-MSIS Analysis Overview
T-MSIS analytic files are a comprehensive resource for Medicaid encounter, beneficiary demographics, program enrollment, service utilization, and payment data. Individual states compile their Medicaid claims data and submit monthly files to the Centers for Medicare & Medicaid Services (CMS). As each state submits data individually, numerous state-specific variations occur in data availability and quality. Currently, T-MSIS data are available for 2016−2023. HMA data scientists have permission to use the T-MSIS files for healthcare services research.
This paper examines services in 10 states that met a threshold of data integrity in the T-MSIS dataset for 2022. Other important design aspects of the analysis are as follows:
- The three service procedures included in the analysis are total knee replacement (TKA), cataract removal, and impacted tooth extraction.
- Selected states represented a diverse sample of geographic, socioeconomic, and other demographic factors.
- The analysis includes non-dually eligible adult populations, ages 22−64 years.
- The data cover all services provided in 2022 for each procedure and the providers who rendered the service; facilities are excluded.
Concentration of Specialty Providers
Table 1 summarizes findings about the concentration of specialty services.
The authors further analyzed the provision of services and, building on a previous study, examined network concentration. Findings were as follows:
- When looking at the same procedure across states, no consistent pattern emerged regarding which states had the highest and lowest concentration of services in the top 10/25 percentile of providers.
- However, when looking at the same procedure across multiple states, TKA tended to have the lowest concentration of services among those studied.
- Regardless of procedure and state, the 50 percent of providers with the lowest number of procedures tended to provide fewer than 10 percent of the total services combined.
These findings suggest that the specialty networks within each state are highly nuanced, and state policymakers need to look at individual specialty networks when considering health policy. State policymakers and managed care organizations (MCOs) need to examine each specialty individually to assess the distribution of services and access to care.
Looking Ahead
Timely access to healthcare services is critical for ensuring optimal health outcomes. The report authors’ analysis of T-MSIS data showed significant concentration of selected specialty services among providers, which may affect appropriate access to these services.
The analysis of concentration of specialty services among Medicaid specialty providers can guide MCOs and state policymakers in developing strategies to improve network adequacy, including clarifying the level of network adequacy and developing policies to assess and regulate access to specialty care. Addressing gaps in access to specialty care can contribute to better health outcomes for Medicaid beneficiaries and may be aligned with provisions in value-based contracts.
Connect with Us
Medicaid consumers, providers, MCOs, and states all have an interest in ensuring access to specialty care for Medicaid beneficiaries. The methodology applied in the analysis for the HMA white paper can be applied and adapted for future analysis to monitor network stability and to compare access among various payers.
For details about this analysis, its implications for state and local policies, and additional research using T-MSIS, contact our experts below.
February 12, 2025
In Focus: Highlights from HMA Analysis of Specialty Services in Medicaid
Webinar Replay: Medicaid in Motion – Navigating Post-Election Policy Changes and Opportunities
This webinar was held February 26, 2025.
During this webinar, our experts as discussed the latest developments in Medicaid financing and policy. With Congressional leaders and new U.S. Department of Health and Human Services officials focusing on Medicaid, significant changes are on the table during the budget reconciliation process. These changes create both risks and opportunities for Medicaid stakeholders. Learn what Congress and the Administration are considering and how it impacts Medicaid markets.
Learning Objectives:
- Understand recent and potential federal statutory and regulatory policy changes affecting Medicaid.
- Identify potential impacts of these policy changes on Medicaid programs, payers, healthcare providers, industry, and beneficiaries.
- Explore changes in Medicaid funding structures and reimbursement mechanisms resulting from federal policy updates.
- Discover feasible practices and strategies to adapt to the evolving federal policy landscape.
Supporting New York to improve reproductive health outcomes and equity
HMA Solutions
Supporting New York to improve reproductive health outcomes and equity
New York healthcare providers and community-based organizations will have new opportunities to use state funding to strengthen reproductive healthcare infrastructure and improve the quality of maternity care. Governor Hochul’s proposed FY 2025 budget includes funding to increase access to comprehensive reproductive healthcare, and capital investment for renovations, equipment upgrades, planning, and construction, to help facilities modernize and secure their operations. The proposed budget also provides flexible funding streams for services and increased reimbursement for hospitals that meet new maternal health quality metrics.
HMA can help your organization
Strategically seek funding to meet your goals and increase access to services
Develop successful grant applications that position your organization for long-term success and sustainability in New York’s transforming publicly financed healthcare environment
Implement new programs and services and measure their impact and value
Improve the quality and accessibility of services you offer.
Identify potential partners with whom to collaborate to expand new and existing services
Anticipated opportunities include:
| Proposed in Governor’s Budget | Opportunity Summary |
| Safety Net Transformation Program Funding | Would dedicate additional funding to support partnerships between safety-net hospitals and other healthcare organizations. |
| Reproductive Freedom and Equity Grant Funding | Would distribute $25 million in funding for the program with focus on strengthening access to comprehensive reproductive care. |
| Strengthening of Reproductive Healthcare Infrastructure | Would invest an additional $5 million in the Reproductive Freedom and Equity Grant Fund and security grant funding to expand capital investment support for providers; enables renovations, equipment upgrades, planning and construction to help facilities modernize and secure their operations. |
| Fair reimbursement for Abortion Services | Would invest an additional $20 million to enhance a new flexible funding stream to allow providers to better adapt to the impact of the incoming federal administration and ensure that providers are fairly reimbursed for providing abortions. |
| Safeguarding of Abortion as Emergency Medical Care | Codifies abortion as protected emergency medical care in New York State and requires hospitals to provide this stabilizing emergency medical care, reinforcing access to abortion services when medically necessary. |
| Increase in Hospital Reimbursement for High-quality Maternity Care | Increases Medicaid rates for hospitals that meet maternal healthcare quality metrics. |
| Expansion of Medicaid Coverage for Fertility Treatment | Extends coverage for fertility preservation services to Medicaid members undergoing medical treatments that may lead to infertility and expands eligibility for the Infertility Reimbursement Program. |
HMA’s nationwide team of experts include:
Former state directors of Title X, Title V Maternal and Child Health programs, and the Children’s Health Insurance Program (CHIP)
Former senior officials from the Centers for Medicare & Medicaid Services and the Health Resources and Services Administration
Advocates and former leaders of community-based organizations, foundations, and other programs that support reproductive health
Clinicians with experience providing a full range of reproductive health services
Social workers and behavioral health professionals working to integrate approaches that address social and behavioral health needs
Program development, strategic planning, and technical assistance experts working to implement innovative models of perinatal care and policy change to address social and economic drivers of maternal health
Experts in value-based payment and operations related to innovative models of perinatal care from the payer and provider perspectives
Researchers and evaluators with extensive experience examining the implementation and impact of policy and operational changes
Our Maternal & Child Health Team at HMA
HMA bring together experts from a full spectrum of reproductive health services including policy, clinical, operations, and research. We work with clients to reach shared goals of supporting maternal and child health, expanding access to the full spectrum of reproductive health services, reducing high rates of maternal and infant mortality and morbidity, and addressing deep and persistent racial disparities in birth outcomes and the inequities that drive them. We help clients stay ahead of the curve in publicly funded healthcare by providing technical assistance, resources, decision support and expertise.
Contact our experts:
Heidi Arthur
Principal
Heidi Arthur has over 20 years of experience in delivery system redesign to promote community-based access to health and human … Read more
Jodi Pekkala
Principal
Jodi Pekkala is an experienced health care quality measurement and improvement researcher and consultant with over 15 years dedicated to … Read more
Diana Rodin
Associate Principal
Diana Rodin has more than 15 years of experience conducting policy analysis and program evaluations, providing technical assistance and developing … Read more
Caroline (Carrie) Rosenzweig
Principal
Carrie Rosenzweig is an experienced consultant specializing in health policy analysis, qualitative research, grant writing, and project management. Her research … Read more
Sharon Silow-Carroll
Principal
Sharon Silow-Carroll specializes in health policy research and analysis. She has more than 25 years of experience collaborating with public … Read more
Kate Washburn
Associate Principal
Kate Washburn is a public health and program leader with over 20 years of experience in both public health departments … Read more
Elizabeth Wolff
Principal
Elizabeth Wolff, MD, MPA is a physician executive who utilizes her expertise in population health, quality improvement, and practice operations to … Read more
Could Congress Compromise Ohio’s Budget through Medicaid?
As policymakers engage the state budget process, Medicaid continues to play a critical role. This role is programmatic, serving as the source of coverage for 1 in 4 Ohioans, including as the finance mechanism for half of all births in the state and the primary source of coverage for the elderly and disabled. However, a number of proposals are currently being discussed by the House, including changing how poverty programs are adjusted for inflation, reversing some Medicaid payment expansions, lowering the minimum federal funding rate for Medicaid, making the federal funding rate the same for all Medicaid expansion populations, limiting taxes on Medicaid providers, capping the amount spent per Medicaid enrollee, standardizing how administrative costs are matched, and other unspecified changes to Medicaid funding through Medicaid match. But these proposals can’t be viewed in isolation because the program is deeply intertwined with Ohio’s ability to have a balanced budget, serving a role in reducing direct state spending by enabling the draw down of federal dollars through “FMAP.” But what is FMAP and what happens if Congress fundamentally changes how it’s calculated?
FMAP
The Federal Medical Assistance Percentage (FMAP) is a critical component of Medicaid funding, ensuring that states receive federal support to provide healthcare services to low-income individuals. FMAP is calculated based on a state’s per capita income relative to the national average. States with lower per capita incomes receive a higher FMAP, meaning the federal government covers a larger share of Medicaid costs, while states with higher per capita incomes receive a lower FMAP. The FMAP formula ensures that states with greater financial need, like Ohio, receive more federal assistance. For Federal Fiscal Year (FFY) 2025, Ohio’s FMAP is 64.6%, which means that for every dollar Ohio spends on most Medicaid services, 64.6 cents comes from the federal government. Even then, much of the state share is financed through fees on entities like hospitals, nursing facilities and health insurance companies.
Contextually, Ohio is a “recipient state,” indicating it receives more in federal tax revenue than it collects to finance the program. And, as was noted in the initial testimony offered in the Ohio House, Ohio continues to lag other states in terms of economic growth and has an aging population. As such, the availability and predictability of federal funding is a critical input in future years, particularly in long term care where most of the expense will continue to increase. With Congress deliberating all of these proposals, what could the impact be in Ohio? To illustrate, it may be good to focus on one area: the elimination of enhanced federal funding for those covered by the Medicaid expansion.
Impacts
There has been some discussion during testimony that if the FMAP rate for the expansion population were to change, it could trigger an automatic end to the expansion itself. Importantly, there would be a disproportionate impact in Ohio’s rural counties where expansion coverage rates are higher. In fact, as of December 2024, 362,829 individuals in rural Ohio counties received their coverage through expansion, alone. These individuals, in addition to the 1.1 million others in these Ohio counties, rely on Medicaid for essential healthcare services, including addiction treatment.
In states with expansion, coverage for individuals with SUD has doubled highlighting the importance of maintaining robust funding for these programs. Expansion has also been the primary source of funding for addiction treatment in the state, with Medicaid covering half of all buprenorphine treatments. If expansion were eliminated due to the change in FMAP, the consequences for treatment may mean either a greater obligation on the state to finance those services directly, or, Ohio may exacerbate the opioid use disorder crisis, putting additional strain on our healthcare system, particularly for behavioral health providers.
Conclusion
As we consider the future of Ohio’s Medicaid expansion, it’s essential to recognize the critical role that FMAP plays in sustaining our healthcare system and supporting our state’s economy. Any changes to the FMAP rate must be carefully evaluated to ensure that we do not undermine the progress we have made in expanding access to care and addressing the opioid crisis.
Beyond the immediate impact on healthcare services, changes to FMAP could also have broader economic implications for Ohio. Medicaid represents about 4% of the state’s GDP, playing a vital role in supporting jobs and economic activity. If just 1% of that GDP were suddenly eliminated due to a cut in federal or state funding, the consequences could be severe. A sudden reduction in Medicaid funding could lead to job losses in the healthcare sector, reduced economic activity, reduced labor force participation, and increased financial strain on state and local governments. The ripple effects would be felt across the economy, impacting not only healthcare providers but also businesses and communities that rely on the stability and support provided by Medicaid as well as the budgetary stability it provides to Ohio’s process.
340B Duplicate Discounts: Enforcement Inconsistent and Weak Due to Lack of Data Transparency and Despite Federal Prohibition
At the intersection of the federal 340B Drug Pricing program and the federal Medicaid Drug Rebate Program (MDRP), a potentially large set of Medicaid claims are generating duplicate discounts, which pharmaceutical manufacturers provide to eligible entities such as hospitals and health centers. These two complex federal programs were designed to reduce the costs of prescription drugs for providers that serve low-income patients, but both state Medicaid agencies and federal policymakers have been actively working to eliminate the unintended overlap of these two programs. To gain deeper insights into why duplicate discounts continue to occur, the scope of this concern, and to identify considerations of future policymaking, HMA conducted interviews with Medicaid officials and drug policy experts across several states.
Duplicate discounts occur when for a single sale a manufacturer is required to: (1) prospectively reduce the price of the product (a discount) they sell to a 340B covered entity in advance of the delivery of care to the patient; and (2) provide a retrospective payment (a rebate) to a state Medicaid program or managed care plan under the MDRP after care is delivered to a Medicaid enrollee. When duplicate discounts occur the manufacturer’s product is discounted twice for the same sale, contravening federal law, which prohibits duplicate discounts.
Despite the statutory prohibition, duplicate discounts remain a concern. Both state and federal policymakers have been actively addressing duplicate discounts but have been unable to identify clear and consistent policy solutions that neutralize this inefficiency. On the state level, Medicaid agencies and state legislatures have implemented policies to address duplicate discounts. On the federal level, the Health Resources and Services Administration (HRSA) and the Centers for Medicare & Medicaid Services (CMS) have conducted audits and published best practices for states to eliminate duplicate discounts. Nonetheless, duplicate discounts persist.
To gain deeper insights into how Medicaid agencies navigate duplicate discounts, Health Management Associates (HMA) conducted semi-structured interviews with former and current Medicaid directors and pharmaceutical policy experts in 14 states. Interviewees were asked about the frequency of duplicate discounts, the extent to which Medicaid agencies devote resources to tracking them, the policies states have implemented to address them, and the extent to which state or federal authorities are working to eliminate duplicate discounts.
Based on interviews, four key themes emerged:
- Duplicate discounts remain a problem, the scope of the problem is unclear, and better data collection from covered entities is necessary.
- The opacity and complexity of duplicate discounts create a burden for state Medicaid agencies, influencing the policies they implement, resulting in variable state policy strategies.
- Contract pharmacies add an additional layer of complexity, exacerbating the burden that duplicate discounts create.
- State and federal authorities could take more decisive action to address duplicate discounts.
Policymakers should consider that the environment for addressing duplicate discounts may become more complex in the future, which may increase the need for a federally coordinated policy solution. The complexity of the environment may deepen due to the increasing presence of contract pharmacies, the increasing presence of managed care in Medicaid programs, and the implementation of the drug pricing policies of the Inflation Reduction Act of 2022. Policy action coordinated across the various stakeholders (e.g., HRSA, CMS, state Medicaid agencies, covered entities, and manufacturers) may represent the best opportunity for success in eliminating duplicate discounts.
HMA can help your community prioritize and plan Opioid Settlement Fund expenditures
HMA partners with state, county, and local government entities nationwide to strategically allocate opioid settlement funds, driving impactful solutions for opioid use disorder (OUD) and overdose prevention. Through collaboration with policymakers, engaged stakeholders, and community members, we help clients develop funding priorities that enhance public health outcomes and improve quality of life. Our team has extensive experience working with counties across the U.S. to design and implement effective OUD programs. By fostering partnerships with clients, community advisory boards, and local organizations, we co-create community engagement strategies, tools, and plans that ensure meaningful participation in decision-making and sustainable program success.
We have a successful track record developing strategic expenditure plans for opioid abatement settlement funds that align with key funding priorities to drive measurable improvements in quality of life for individuals experiencing OUD and to implement effective overdose prevention initiatives.
How HMA can help
Community-Driven Fund Allocation – Effective use of opioid settlement funds depends on robust community engagement and feedback, ensuring investments align with local needs and priorities.
Expert Facilitation of Consensus Building – HMA’s unique ability to navigate complex community dynamics enables us to diffuse tensions, validate diverse perspectives, and drive stakeholder alignment for impactful decision-making.
Data-Backed Strategic Planning – Our comprehensive data collection and analysis identify persistent challenges, best practices, and targeted actions across the continuum of care (prevention, intervention, and treatment), culminating in a final report that informs sustainable solutions.
Elevating Community Voices – We prioritize the insights of individuals with lived experience, healthcare providers, and tribal partners to ensure funding priorities reflect the real needs of those affected by OUD.
Blueprint for Sustainable Impact – The expenditure plan serves as a strategic manual for the effective use of opioid settlement funds, integrating state requirements with community-driven priorities to maximize long-term success.
OUR EXPERTISE
With deep expertise in opioid settlement fund expenditure planning and a proven track record of success, HMA is uniquely positioned to help organizations nationwide design and implement effective OUD programs. Our team brings unparalleled experience in strategic planning, community engagement, and policy development, ensuring that funding is maximized for sustainable impact. We leverage strong partnerships and customized engagement strategies to drive data-driven, community-centered decision-making.
For recent examples of our work:
Contact our experts:
Charles Robbins
Principal
Charles Robbins has been transforming communities for the past three decades. His extensive community-based organization career spans healthcare, child welfare, … Read more
Devon Schechinger
Senior Consultant
Devon Schechinger is a leader with extensive experience driving impactful change in behavioral health, housing, public policy, and state and … Read more
Increasing the Cultural and Linguistic Accessibility of Services
HMA Solutions
Increasing the Cultural and Linguistic Accessibility of Services
National Standards for Culturally and Linguistically Appropriate Services (CLAS) in Health and Healthcare frame how to improve healthcare quality and reduce disparities through a whole-person approach. Implementation of the CLAS standards demonstrates respect for individuals and responsiveness to their health needs, cultural beliefs and practices, preferred languages, and other communication needs. These standards guide the provision of high-quality care to people from all cultures and backgrounds, as well as persons with disabilities and rural populations. The 15 CLAS standards focus on governance, leadership, workforce, communication, language access, engagement, continuous improvement and accountability.
Quality
Provide services that are responsive to diverse backgrounds across the US
Equity
Reduce persistent health disparities experienced by racial, ethnic, linguistic, sexual, and gender minorities; persons with disabilities; and rural populations
Experiences of Care
Respect the whole individual and respond to the individual’s health needs and preferences
Cost
Reduce total cost of care by addressing health disparities
WHY CARE ABOUT CLAS?
In 2022, Forbes reported that health inequities cost the US health system $320 billion now and could reach $1 trillion by 2040
Health Inequities Could Cost The U.S. Health System $1 Trillion By 2040, New Report Says
What We Do
Our experts work with states, Certified Community Behavioral Health Clinics (CCBHC), behavioral health organizations, health systems and providers, health plans, and public health organizations to develop CLAS programs, assess gaps in the cultural and linguistic accessibility of services across a system, and provide tailored technical assistance and trainings. Adherence to CLAS standards is required by the Substance Abuse and Mental Health Services Administration (SAMHSA) for initiatives like the CCBHC model due to its positive impact on programming, outcomes, and disparity reduction.
Our CLAS Work
Indiana Statewide Evaluation of Community Mental Health Center (CMHC) CLAS Compliance
HMA completed a comprehensive assessment of Indiana’s 24 CMHCs to evaluate the strengths and needs regarding CLAS standards. We provided coaching, technical assistance, and webinars to support the CMHCs to set goals, build action plans, operationalize CLAS standards, and align CCBHC demonstration preparation and CLAS efforts.
Delaware Division of Substance Abuse and Mental Health (DSAMH) CLAS Training & Mini-Grants
HMA collaborated with DSAMH to develop a strategy to increase cultural responsiveness of substance use disorder (SUD) services. This included implementing a CLAS mini-grant program to provide technical assistance and training for SUD services. We developed and delivered a CLAS “train-the trainer” curriculum for staff, focusing on culturally and linguistically responsive opioid use disorder (OUD) services for African American and Latine communities. We also created a CLAS standards assessment to frame community-based organization and provider improvement strategies.
CCBHC Transformation Projects Across the Country
Disparity reduction is key to the CCBHC model. Nationally, the HMA CLAS team offers technical assistance to states on how to embed CLAS standards into planning grant and demonstration grant applications. For states that have been awarded CCBHC funding, we can provide training on how to incorporate CLAS standards and disparity reduction strategies into various aspects of their operations. These include community needs assessments, advisory boards, policies and procedures, staff training, program operations, state administrative codes, quality improvement and assurance initiatives, as well as data collection and analysis processes.
Our CLAS Approach
HMA’s team tailors its support based on each client’s needs. HMA takes the following general approach to assess and implement CLAS standards:
Assess CLAS standard gaps at organization, system or state level focused on the three CLAS domains: Governance, Leadership and Workforce; Communication and Language Assistance; and Engagement, Continuous Improvement and Accountability
Provide tailored technical assistance and coaching to close gaps drawing on our team’s cultural and linguistic diversity and lived experiences with services that are inaccessible to persons with disabilities, as well as persons from racial, ethnic, linguistic, cultural, sexual, and gender minority groups
Design and facilitate training and webinars to address wide scale gaps. Webinar topics may include – using Continuous Quality Improvement (CQI) processes to reduce disparities; increasing language access through translation and interpretation best practices; how to use community needs assessments to identify disparities; and structuring advisory boards for maximum impact
Assist programs and states in developing a CQI strategy to monitor and adjust initiatives to ensure CLAS and disparity reduction initiatives are making demonstrable change
Contact Our Experts:
Nora Carreras
Associate Principal
Nora Carreras is a proven leader and team builder with expertise in social determinants of health (SDOH) and non-profit management. … Read more
Carmen Daniels Jones
Principal
Carmen Daniels Jones is an accomplished executive with more than 15 years of experience working in the federal government, the … Read more
Rachel Johnson-Yates
Associate Principal
Rachel Johnson-Yates is a licensed mental health and addiction counselor, public speaker, and educator with a demonstrated track record of … Read more
Erica Reaves
Senior Consultant
For more than a decade, Erica L. Reaves has focused her career on expanding access to long-term services and supports … Read more
Leticia Reyes-Nash
Office Managing Principal
Leticia Reyes-Nash is an accomplished, innovative executive leader with 20 years of experience leading policy advocacy, projects, and community engagement, … Read more
Reem Sharaf
Senior Consultant
Reem Sharaf is a licensed clinical social worker and behavioral health leader with 15 years of experience in program development … Read more
Madeleine (Maddy) Shea
Principal
Maddy Shea has a passion for health equity and the federal, state and local cross-sectoral expertise to guide community health … Read more
Doris Tolliver
Managing Principal
Doris Tolliver is a strategic thinker specializing in racial and ethnic equity, organizational effectiveness, change management, and business strategy development. She … Read more
A Closer Look at Gubernatorial Healthcare Priorities: 2025 State of the State Address Overview
This week, our In Focus section examines governors’ healthcare priorities from their 2025 State of the State addresses. This article highlights common themes in addresses delivered between January 6, 2025, and January 16, 2025, and delves into specific proposals in Georgia, Iowa, New York, and Oregon, as analyzed in the Health Management Associates (HMA), Information Services (HMAIS) interim report, 2025 State of the State Overview.
State of the States in the Current Environment
Governors use their State of the State addresses to outline their priorities for the year, giving insight into the agendas and initiatives that their executive branches may pursue independently or in collaboration with their state legislature. These priorities often are informed by the status of the state’s budget, with some governors advancing healthcare proposals that will address budget deficits and others seeking to invest in services and workforce initiatives.
Monitoring governors’ policy priorities and initiatives is especially important in 2025 given the changing federal landscape. The transition in both the administration and Congress will require state leaders to carefully consider the risks and opportunities. As detailed below, governors’ responses will unfold differently across states and markets.
Common Threads
In all, 24 governors delivered a State of the State Address between January 6, 2025, and January 16, 2025. Many gubernatorial leaders have similar areas of priority and concern, with some continuing multiyear initiatives to address unmet behavioral health needs and control healthcare costs. Table 1 identifies the themes emerging from the first group of addresses.
Governors also are considering possible policy changes under the new Trump Administration. For example, some governors reported that their state is looking to strengthen or add Medicaid work requirements to their programs, resuming initiatives that were initially pursued during the first Trump Administration. Though not directly related to healthcare, governors’ decisions to mirror President Trump’s Department of Government Efficiency, with Iowa as an example, could indirectly affect local programs and markets. Other states are considering the implications of possible changes to federal Medicaid funding. A deeper look into the priorities in Georgia, Iowa, New York, and Oregon follows.
Georgia
Gov. Brian Kemp delivered Georgia’s State of the State address on January 16, 2025, during which he focused his healthcare remarks on the state’s Pathways to Coverage Section 1115 demonstration. Georgia’s waiver extends Medicaid coverage to able-bodied adults who earn up to the federal poverty level if they meet certain work requirements. The governor emphasized that he intends to work with the Trump Administration to further advance innovative approaches to healthcare access.
Governor Kemp stated that his administration is making it easier to apply for Medicaid coverage and will submit an amendment to the Centers for Medicare & Medicaid Services (CMS) that would extend the Pathways demonstration for five years beyond the current expiration date of September 30, 2025. The state plans to request several changes to the demonstration, including:
- Changing the reporting requirements for qualified work activities
- Adding more activities that qualify for program eligibility
- Adding a retroactive coverage policy
- Removing premiums and Member Reports Accounts
The governor’s proposed fiscal year (FY) 2026 budget includes $324 million to fully fund projected Medicaid enrollment and utilization growth and $36 million in additional support for pharmacy benefits, including recently approved gene therapy treatments for sickle cell disease.
Iowa
Iowa Gov. Kim Reynolds delivered the Condition of the State Address on January 14, 2025, during which she called for increased Medicaid reimbursement rates for OB/GYNs and primary care physicians who provide care to people with complex pregnancy cases, as well as certified nurse midwives. The governor also said she was in favor of adding doula services as a covered Medicaid benefit. Governor Reynolds is one of several governors who have announced plans to pursue a Section 1115 demonstration for Medicaid work requirements for able-bodied adults.
Governor Reynolds’s proposed FY 2026 budget includes investing $642,000 in newly unbundled Medicaid maternal rates, and more than double investments in five existing state healthcare loan repayment programs. The governor also proposes to establish a Medicaid Graduate Medical Education enhanced payment to draw down more than $150 million in federal dollars for more residency spots in Iowa’s teaching hospitals.
New York
New York Gov. Kathy Hochul delivered her State of the State Address on January 14, 2025, at which time she also released a State of the State Book. Addressing behavioral health is one of her chief priorities, and proposals include:
- Allowing more involuntary commitments for people with severe mental illness
- Developing programs to support youth mental health through after school programs
- Expanding peer support programs
- Improving the diagnostic process for children with complex needs
- Supporting mental wellness in historically marginalized neighborhoods
- Expanding Mobile Medication Units to bring opioid treatments to underserved areas
Governor Hochul intends to expand support for the state’s healthcare safety net. This part of her agenda would provide financial assistance to struggling medical facilities and hospitals through expansion of the state’s Safety Net Transformation Program and participation in the US Food and Drug Administration’s program that allows states to import lower-cost drugs from Canada.
The governor’s proposed $252 billion budget for FY 2026 would allocate $35.4 billion for the state Health Department’s Medicaid budget—a 14 percent increase from last year. Governor Hochul plans to offset some of the spending hike with revenue from the newly approved managed care organization tax, which is expected to raise $3.7 billion to help balance the state budget over three years.
Oregon
Gov. Tina Kotek delivered Oregon’s 2025 State of the State Address on January 13, 2025. The governor has a significant focus on mental health and substance use disorder treatment, as well as housing as an HRSN. Governor Kotek wants to strengthen the behavioral health system and proposed adding new treatment beds, increasing treatment capacity, eliminating backlogs at the state’s health licensing boards to improve access to qualified counselors, improving the provider pipeline, and increasing worker retention. During her speech, the governor also called for improved frontend care coordination to decrease the overflow of people at the Oregon State Hospital.
In addition, the governor intends to work toward improving care for the civil commitment population (i.e., people who are involuntarily detained in a psychiatric hospital) by dedicating permanent supportive housing funds to expanded residences with onsite services. Governor Kotek has directed her team to develop a new intensive permanent supportive housing model to more effectively support people with serious mental health needs.
Governor Kotek’s proposed budget for the 2025−2027 biennium includes $39.6 billion for the Oregon Health Authority, representing a 10.4 percent increase from the approved budget for 2023−2025. This budget includes $29.6 billion for the state Medicaid program and $1.6 billion for the Behavioral Health Division, in addition to $732.4 million for the division from the General Fund.
Connect With Us
HMAIS has prepared a comprehensive report summarizing each State of the State Address, which is available to HMAIS subscribers. The report also examines proposed budgets, highlighting key financial commitments and allocations that underscore these priorities for the upcoming year. The first iteration of the report covers AR, AZ, CO, CT, GA, IA, ID, KS, KY, MA, MT, ND, NE, NH, NJ, NV, NY, OR, RI, SD, VA, VT, WA, and WY. The document will be updated periodically as speeches occur.
Contact our experts below for more information about the report or to connect with one of HMA’s state policy and market experts.