Weekly StateVitals Update: Volume 63 (April 6, 2026)
National
Federal Investigation into Undocumented Medicaid Enrollees Yields Limited Results. In August, the U.S. Department of Health and Human Services sent states the names of hundreds of thousands of Medicaid enrollees to determine if they were ineligible due to their immigration status. Seven months later, findings reported this past week by news outlets in five states (CO, OH, PA, TX, and UT) have revealed very little evidence of any widespread problem of ineligible enrollees.
Colorado’s and Pennsylvania’s Medicaid agencies checked 79,000 names in total and found that no one needed to be terminated.
Ohio’s Department of Medicaid reviewed the names of 65,000 enrollees and terminated coverage for 260 people.
Texas’ Department of Human Services checked 28,000 Medicaid enrollees and disenrolled 77 individuals.
Utah’s Department of Workforce Services reviewed 8,000 enrollees and decided to terminate coverage for 42 enrollees.
As part of the enrollment process, states already check the immigration status of potential enrollees to determine if they are eligible for coverage. The reviews ordered by HHS served as an additional verification of enrollees’ citizenship or immigration status for enrollees for whom the Centers for Medicare and Medicaid Services (CMS) could not confirm through federal data sources. In Ohio, the majority of the requested names were those of U.S. citizens. Of the 65,000 names, the state already had information confirming that 53,000 belonged to citizens, 11,000 had the appropriate immigration status, and the remaining 1,000 were assigned caseworkers for further review. While only 5 states provided information, CMS instructed all 50 states and the District of Columbia to provide verification checks. As it stands, CMS continues to send states lists of names to verify every few months, albeit fewer than the initial batch in August.
Colorado
Head of Colorado Department Overseeing Medicaid Resigns. Last Monday, Governor Jared Polis (D) announced that the Department of Health Care Policy and Financing (HCPF) Executive Director, Kim Bimestefer, would resign on April 10. HCPF oversees the state’s Medicaid program, which has come under fire amid recent waste discoveries and major cuts to the state’s Medicaid budget. Before Gov. Polis announced Director Bimestefer’s resignation, the Senate was preparing to debate a resolution of no confidence in her, urging Governor Polis to remove her as executive director. Senator Kyle Mullica (D-Thornton) led the resolution, and although 26 out of 35 senators had signed on in support, no one introduced it this session. In late February, the Department of Health and Human Services Office of Inspector General (HHS OIG) issued an audit of the state’s Medicaid program. In the audit, HHS OIG officials determined that the program had made at least $77.8 million in improper payments for services for children with autism. As a result, HHS OIG mandated the state repay the federal government $42.6 million and conduct periodic reviews of payments to autism centers offering applied behavior analysis therapy. Notably, this problem is not limited to Colorado: following HHS OIG audits, other states, including Indiana, Maine, and Wisconsin, have also been ordered to return federal funds for autism therapy for similar billing issues.
In addition to the improper billing for applied behavior analysis therapy, state Medicaid officials recently stated they had been overpaying contracted transportation providers for wheelchair-using patients. While state officials did not determine the cost to the Medicaid program, they noted that correcting the billing guidance error in November would save the state $33 million in the current fiscal year. These costs are critical; currently, the state faces a $1.5 billion budget shortfall for the upcoming fiscal year.
Joint Budget Committee Staff Drafts State Budget with Significant Medicaid Cuts. Last Wednesday, the Joint Budget Committee (JBC) Staff completed its draft of the state budget, which includes significant Medicaid cuts to address an approximate $1.5 billion shortfall. The committee voted to cut Medicaid reimbursement rates by 2%, with exemptions for maternal health, neonatal intensive care, and pediatric autism care providers, the latter of which had already received a payment cut. Additionally, the JBC voted to limit coverage on Cover All Coloradans, a program that extends coverage to children and pregnant women who are ineligible for Medicaid due to their immigration status, but would be eligible otherwise. The new limits would cap coverage at 25,000 children and reduce the eligibility cutoff from 19 to 18. Moreover, the panel suggested ending enrollment if costs are on pace to surpass $96 million next fiscal year. It is expected that the budget bill will be introduced in the near future, and additional analysis on the proposed cuts can be found here when it is up for committee discussion and consideration.
US Supreme Court Rules Against Colorado’s Ban on Conversion Therapy. On Tuesday, the Supreme Court ruled 8-1 that the First Amendment prohibits states from using their licensing power to limit the topics therapists and other professionals can discuss with their clients. The case, Chiles v. Salazar, covered Colorado’s 2019 law that prohibits licensed counselors from engaging in conversion therapy with minors. Kacey Chiles, a licensed counselor and practicing Christian, brought the case. She said her counseling is sometimes informed by her faith and that she wished to offer talk therapy to minors who want to reduce feelings of same-sex attraction or feel more comfortable in their bodies.
Justice Neil Gorsuch wrote the majority opinion, noting that the state’s ban “censors speech based on viewpoint,” something which represents an “egregious assault” on commitments to free thought and speech made by the First Amendment. Justices Elena Kagan and Sonia Sotomayor wrote a separate concurring opinion that the Colorado law allowed some counseling on sexual orientation and gender identity, but prohibited other professional approaches. Justice Kagan suggested that a complete ban on therapy targeting a person’s sexual orientation or gender identity may be lawful, unlike Colorado’s approach. As the sole dissenter, Justice Ketanji Brown Jackson argued that the majority opinion unwisely interfered with states’ regulation of the practice of medicine and similar professions. In their ruling, the majority of the Justices stated the 10th Circuit Court should have applied strict scrutiny, a more stringent standard of review, when determining whether Colorado’s ban violates the First Amendment as applied to Ms. Chiles. Thus, the court reversed the 10th Circuit’s ruling upholding the ban and sent it back to the appeals court to examine under the stricter standard.
Idaho
State to Delay Medicaid Managed Care Implementation. Recently, the Idaho Department of Health and Welfare released a notice on their Medicaid managed care transition home page announcing a delayed implementation date to January 1, 2030. Originally, when the state passed HB 345 in March of 2025, the expectation was that Idaho would transition from a fee-for-service model to a managed care model by January 1, 2029. The Department noted in its announcement that it will share additional information about the Request for Proposal at a later date and time, once that information becomes available.
Governor Little Approves Restoring Funds to Medicaid Mental Health Programs. Last Thursday, Governor Brad Little (R) signed SB 1446 into law, reinstating funds for the Assertive Community Treatment program and peer support services. The funding decision is in response to four patients passing away in the three months since the legislature cut the mental health mobile treatment program. This rate is much higher than the previous 18-month period before the cut, when one patient passed away. Notably, the move to reinstate funds for the cut mental health programs stands out as an exception among other funding decisions this past session. During the recently adjourned session, legislators reduced reimbursements to Medicaid disability providers and maintained cuts to several other health care programs to avoid a budget shortfall.
Maryland
Legislature Passes Legislation to Establish Protections for Emergency Abortions. Last week, the legislature passed SB 169 to establish requirements for hospitals with regard to emergency pregnancy-related medical conditions. The bill would establish requirements and prohibitions related to the treatment and transfer of a patient who has an emergency pregnancy-related condition and requires a hospital to allow the termination of a pregnancy if the patient’s treating healthcare practitioner determines it is medically necessary to stabilize the patient. The proposed law is intended to mirror the federal Emergency Treatment and Active Labor Act (EMTALA), which requires hospitals with emergency departments to provide stabilizing care to patients with a medical emergency, and follows a trend of blue states codifying similar protections for emergency abortions following the U.S. Supreme Court’s dismissal of a case concerning the EMTALA in 2024 and the Trump Administration’s rescission of EMTALA abortion guidance. The bill now heads to Governor Wes Moore (D), who is expected to sign the bill.
Mississippi
Legislature Sends Bill to Ban Abortion-Inducing Drugs to Governor. This past week, lawmakers passed HB 1613, which would make it unlawful to knowingly or intentionally create, sell, barter, transfer, manufacture, distribute, dispense, prescribe, or possess with knowledge or intent to create, sell, barter, transfer, manufacture, distribute, dispense, or prescribe an "abortion-inducing drug." The bill specifies that the definition of abortion-inducing drug does not apply to drugs that may be known to cause an abortion but are prescribed for other medical indications, such as chemotherapeutic agents and diagnostic drugs, or are used in the course of lawful medical care, including the treatment of miscarriage, ectopic pregnancy, fetal demise, induction of labor, and management of postpartum complications. The bill proposes imprisonment for violations and authorizes the Attorney General to bring civil action to enjoin a violation and recover civil penalties. The bill passed the legislature along party lines and now heads to Governor Tate Reeves (R), who is expected to sign the bill.
Nevada
Health Authority Submits Amendment to Update Medicaid Reimbursement Policies. Recently, the Nevada Health Authority submitted a State Plan Amendment to update the State Plan Rate Methodology for Rural Health Clinics (RHCs) and Federally Qualified Health Centers (FQHCs). If approved, the amendment would clarify when to use alternative payment methodologies, update prospective payment system (PPS) rate methodologies to align with statewide managed care requirements, and create processes for supplemental payments when managed care organization payments fall below PPS rates. Additionally, the amendment adds documentation submission timelines for rate-review enforcement and includes language on out-of-state FQHC rate-setting. The SPA has a proposed retroactive date of February 22, 2026.
New Mexico
Senate Republicans Request Fraud, Waste, and Abuse Committee. Last Tuesday, all Republican members of the New Mexico Senate co-signed a letter to request an interim legislative committee on fraud, waste, and abuse (FWA) across state government. The committee would provide briefings to legislators and the public on audits and investigative reports made by the Office of the State Auditor. Additionally, Republicans argue the committee would allow legislators to identify patterns of FWA, evaluate the effectiveness of corrective actions, and develop budget and legislative fixes. The request comes in response to a letter from the state auditor in February that expressed concerns about $4.2 million of potential misappropriated funds in the Children, Youth, and Families Department. Looking ahead, legislators wrote they intend to introduce bills next session to formalize their effort to tackle FWA in the state.
North Carolina
State Treasurer and SEANC Request Supreme Court to Revisit Certificate-of-Need Law. This past Wednesday, State Treasurer Brad Briner and the State Employees Association of North Carolina filed a joint brief urging the Supreme Court to revisit the state’s certificate-of-need (CON) law. The same day, the John Locke Foundation and University of North Carolina School of Law Professor John Orth filed a separate brief asking the Supreme Court to revisit the law as well. These briefs follow a years-long effort and challenge by ophthalmologist Dr. Jay Singleton to the state’s CON laws. In October 2024, the North Carolina Supreme Court issued a unanimous ruling requiring a trial court to conduct a broad trial to determine whether the state’s CON laws are unconstitutional. In December 2025, the Trial Court upheld the constitutionality of the CON law, prompting Dr. Singleton to file a notice of appeal in January and additional paperwork to move the case back to the Supreme Court in March. At issue is Dr. Singleton’s complaint that he could perform a certain cataract surgery for $1,800 while the local hospital charges $6,000 for the same procedure. However, the ophthalmologist contends he is prohibited from purchasing the equipment necessary to perform the procedure because CON rulings have been issued stating that only the hospital may perform such a procedure in the defined geographic area.
South Dakota
Legislators to Learn About Emergency Services, Native American Health Care, and Disability Services for Next Session. After the Legislature adjourned this past week, lawmakers announced their summer study plans for the months ahead. As part of the summer studies, a task force was created by the Legislature to study the creation of Indian Medicaid managed care entities. The idea was originally proposed as a pilot by the Rosebud Sioux Tribe in January. The concept is that tribes in South Dakota could contract with the state to pull down federal matching Medicaid dollars into a pool for health care delivery, similar to a traditional Medicaid managed care system. The Tribes could then establish their own entity that could negotiate with off-reservation providers and then coordinate the care of their enrolled members. The Department of Social Services will lead the Task Force through November 2028 to determine whether such a program is feasible and to consider any initial implementation.
At the same time, the Legislature will see a summer study focused on creating a Developmental Disability Service Delivery Committee. The Committee will review and determine the efficacy of the state’s Medicaid waiver programs, which enable elderly or disabled individuals to receive Medicaid coverage services while in their homes instead of institutional settings. Finally, the state will establish a task force to examine what are financially sustainable options for counties and cities to support emergency medical services, if they’re designated as an essential service. Notably, there has been a push in recent years for the state to recognize emergency medical services as essential under state law. That change has yet to happen.
State Awards $7.8 million in Opioid Settlement Grants. This past Thursday, Governor Larry Rhoden (R) announced that the state would award over $7.8 million in opioid settlement transformative grants to address community resource gaps. This funding is for the second round of grants, worth up to $2 million, following the state's switch to a three-tiered funding framework. The 10 funded projects focused on expanding behavioral health services, increasing access, and strengthening the healthcare workforce. Looking ahead, the state is projected to receive approximately $70 million in settlement funds through 2038.
Tennessee
House of Representatives Set for Vote on CON Reform Measure This Week. This week, it is expected that the House of Representatives will take a final vote on HB 819. The measure would remove Certificate of Need (CON) requirements from acute care hospitals. The movement on HB 819 follows movement on the companion bill, SB 1369, which passed the Senate during the last full week of March and has been engrossed and sent to the House for consideration. The move comes as the state has been considering CON reform for the past multiple sessions, and a financial incentive is in play, given CON removal is a positive scoring criterion for states in being awarded Rural Health Transformation Fund grant dollars.
Virginia
Contraception Bills Officially Enrolled and Sent to the Governor’s Desk. This past week, the Legislature procedurally enrolled both HB 6 and SB 361 and sent them to Governor Abigail Spanberger’s (D) desk for signature. HB 6 establishes a state right to obtain and engage in utilizing contraceptives. The measure also provides a statutory right for providers to provide contraceptives and related information if within their scope of practice. The measure authorizes civil actions that consumers may take if their rights are infringed upon. Notably, in SB 361, health insurers are required to provide coverage for contraceptive drugs and devices, including over-the-counter. The measure also establishes guardrails for how insurers may provide such coverage, including a limitation on cost-sharing and potentially burdensome restrictions or delays as defined in law. On both bills, the Governor’s deadline for action is April 13.
Washington
Pharmaceutical Companies Sue Washington over 340B Drug Pricing Law. Last week, Governor Bob Ferguson (D) signed SB 5981 into law. The same day, two pharmaceutical companies filed a lawsuit, arguing they will lose millions of dollars once the law takes effect. The law itself would prohibit drug manufacturers from restricting contract pharmacy access or requiring access to claims, utilization, purchasing, or other data as a condition for hospitals to benefit from 340B drug discounts. Additionally, the law authorizes covered entities or the Attorney General to file civil actions against manufacturers and related third parties for violating this act. Notably, several states (including Hawaii, North Dakota, Oklahoma, Rhode Island, Vermont, and 15 others) have filed similar laws prohibiting drug manufacturers from limiting the use of contract pharmacies in the 340B program. Across the nation, district and circuit courts' rulings on these laws have varied. Some courts have upheld several states’ laws, including those of Louisiana, Hawaii, and Minnesota. Contrastingly, the 4th Circuit Court recently upheld a request for a preliminary injunction for West Virginia’s 340B contract pharmacy law.
West Virginia
4th Circuit Court Upholds Preliminary Injunction on West Virginia 340B Law. Last Tuesday, the U.S. Court of Appeals for the 4th Circuit upheld a preliminary injunction issued by the District Court for West Virginia to block the enforcement of SB 325. The law prohibited drug manufacturers from restricting any 340B-authorized location’s access to 340B drugs or requiring claims data as a condition for delivery. The Circuit Court held that SB 325 is preempted by federal law because it rewrites the “bargain” that Congress made with manufacturers and interferes with the Department of Health and Human Services' enforcement role. This decision contrasts with earlier rulings by the 5th and 8th Circuits, which upheld laws in Louisiana and Arkansas, respectively.
