Senate approves Medicaid tax change; Snyder has concerns

Oct 20, 2016

Health care
Credit flickr.com / flickr.com

The Michigan Legislature's approval of a change in how health insurers are taxed to help fund Medicaid sets up a showdown with Gov. Rick Snyder.

The Republican-led Senate voted overwhelmingly Thursday to continue a tax on Medicaid managed care organizations, shift funding around and more quickly end a tax on health insurance claims.

It's the latest in Michigan's long-running attempts to not run afoul of the federal government, which has indicated the Medicaid managed care tax should expire.

The legislation is headed to Snyder.

A spokesman for state budget director John Roberts says he's opposed because he "wants to avoid creating unnecessary risks and pressures on future budgets."

If the federal government rejects the plan, Michigan could lose hundreds of millions in annual revenue.