CMS has proposed a rule to end states’ ability to exploit health care-related tax loophole

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Mehmet Oz, Administrator for the Centers for Medicare & Medicaid Services | https://upload.wikimedia.org/wikipedia/commons/thumb/7/74/CMS_Admin_Dr_Mehmet_Oz.png/500px-CMS_Admin_Dr_Mehmet_Oz.png

CMS has proposed a rule to end states’ ability to exploit health care-related tax loophole

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Dr. Mehmet Oz announced that the Centers for Medicare & Medicaid Services (CMS) are partnering with states to strengthen Medicaid by aligning incentives more effectively.

According to a post on X from CMS, the agency has proposed a new rule aimed at closing a loophole that allowed states to exploit healthcare-related taxes. This regulatory step is expected to save taxpayers over $30 billion within five years, delivering reform and safeguarding federal funds.

In a recent CMS press release, Dr. Oz said, "States are gaming the system--creating complex tax schemes that shift their responsibility to invest in Medicaid and rob federal taxpayers... This proposed rule stops the shell game and ensures federal Medicaid dollars go where they're needed most -- to pay for health care for vulnerable Americans who rely on this program, not to plug state budget holes or bankroll benefits for noncitizens."


Dr. Oz announcement on X | https://x.com/DrOzCMS/status/1922386431772590462

According to an April 2025 Harvard-Harris Poll, 69% of voters support "undertaking a full-scale effort to find and eliminate fraud and waste in government expenditures," compared to 31% who favor slashing $1 trillion in government spending. Additionally, a majority of voters believe the U.S. should work toward balancing its budget, reducing government expenditures, and conducting a comprehensive review of current spending.

DOGE is described as a federal agency focused on optimizing government spending, reducing waste, and ensuring accountability in contract management. By reviewing expenditures and canceling non-essential contracts, DOGE aims to improve fiscal responsibility and enhance the effectiveness of public resource allocation.

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