Connecticut General Assembly approves Medicaid rate increases effective July 2025

In a significant move to enhance healthcare access and provider sustainability, the Connecticut State Legislature has introduced House Bill 7191, aimed at increasing Medicaid provider rates. The bill, presented on April 1, 2025, seeks to address longstanding concerns regarding the adequacy of Medicaid reimbursements, which have been criticized for being insufficient to support healthcare providers adequately.

The primary objective of House Bill 7191 is to implement a phased increase in Medicaid provider rates, aligning them more closely with Medicare rates and a five-state benchmark that includes Maine, Massachusetts, New Jersey, New York, and Oregon. Specifically, the bill mandates that by June 30, 2028, Medicaid rates must reach at least 75% of the most recent Medicare rates for comparable healthcare services. For services lacking corresponding Medicare rates, the bill stipulates that rates should be adjusted to reflect an equivalent percentage of the five-state benchmark.

This legislative effort comes in response to a Medicaid rate study commissioned by the Department of Social Services, which highlighted the need for adjustments to ensure that providers can continue to offer essential services to Medicaid recipients. The bill's provisions are set to take effect on July 1, 2025, with annual adjustments thereafter to maintain the established benchmarks.

Debate surrounding House Bill 7191 has been robust, with proponents arguing that the increases are crucial for maintaining a viable healthcare system that serves low-income populations. They emphasize that adequate reimbursement rates are essential for attracting and retaining healthcare providers, particularly in underserved areas. Conversely, some lawmakers express concerns about the financial implications of the bill, questioning the sustainability of funding these increases amid budget constraints.

The economic implications of House Bill 7191 are significant. By improving Medicaid reimbursement rates, the bill aims to bolster the financial health of healthcare providers, potentially leading to enhanced service delivery and better health outcomes for Medicaid beneficiaries. Additionally, the bill could stimulate job growth within the healthcare sector as providers expand their services in response to improved funding.

As the legislative process unfolds, stakeholders from various sectors, including healthcare providers, advocacy groups, and policymakers, will be closely monitoring the bill's progress. The outcome of House Bill 7191 could set a precedent for future healthcare funding initiatives in Connecticut, shaping the landscape of Medicaid services for years to come.