H 8405Health Insurance

Human Services - Medical Assistance - Long-Term Care Service and Finance Reform - Assisted Living Community Medicaid Rates

This bill creates an automatic, annual inflation-based increase to Medicaid payments for assisted living facilities starting in 2026.

Introduced

Population
Affected

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Introduced Apr 3, 2026Committee House Finance

Plain-English Summary

This bill requires the state to automatically increase the amount of money it pays to assisted living facilities for Medicaid patients every year. Starting on July 1, 2026, these payments will go up based on the annual inflation rate for the Northeast region, as measured by the Consumer Price Index. These increases will happen automatically without needing yearly approval from the state legislature. The state can still choose to give larger increases if it wants to, but the inflation-based increase is guaranteed.

For younger readers

Medicaid is a government program that helps pay for healthcare for people who don't have a lot of money. Sometimes, older people or people who need extra help live in places called "assisted living facilities." This bill makes a rule that the amount of money the government pays these places for helping Medicaid patients will automatically go up a little bit every year. The increase is based on how much the prices of everyday things go up, which is called inflation. This rule starts in the year 2026.

Who & Where It Applies

Impacted groups

Assisted living facility operatorsMedicaid recipients in assisted livingState taxpayersExecutive Office of Health and Human Services (EOHHS)Assisted living healthcare workers

Impacted communities

All

Constitutional & Fiscal Check

None Likely. The bill simply adjusts state Medicaid reimbursement rates and does not implicate free speech, due process, or protection from unreasonable searches and seizures. The legislature has the constitutional authority to direct state agency spending and establish funding formulas.

Estimated cost

Amount unknown

Estimated revenue

None

Bill Analysis

Both viewpoints

For Progressives

Ensures that facilities providing vital care to low-income Medicaid recipients receive stable, inflation-adjusted funding, preventing cuts to essential services for vulnerable populations.
Bypasses the need for annual political battles over funding by making the increases automatic, protecting the social safety net from austerity measures or budget cuts.
Supports the ongoing viability of assisted living communities that accept Medicaid, potentially improving access to care and living conditions for the elderly and disabled who rely on government assistance.
Mandates automatic budget increases for private assisted living businesses without tying the extra funds to mandatory wage increases or better benefits for the frontline healthcare workers employed there.
Locks in funding formulas that could divert limited state Medicaid resources away from other critical public health programs or community-based care initiatives.
Focuses strictly on financial reimbursement rates for facility operators rather than introducing new regulatory standards to ensure the quality of care or equity for the residents actually receiving the services.

For Conservatives

Provides financial predictability and protection against inflation for private assisted living businesses, allowing them to operate with more stable revenue streams.
Reduces government bureaucracy and legislative red tape by making the rate adjustments automatic, eliminating the need for annual lobbying and budget negotiations.
Encourages private facilities to continue accepting Medicaid patients by ensuring reimbursement rates keep pace with the rising costs of doing business in the Northeast region.
Creates an automatic, mandatory increase in government spending that bypasses the annual legislative appropriation process, reducing fiscal oversight and control over the state budget.
Expands the financial footprint of the taxpayer-funded Medicaid program, permanently locking the state into higher entitlement spending regardless of broader economic conditions or revenue shortfalls.
Relies on a broad regional inflation metric (CPI-U for the Northeast) that may overstate actual local cost increases, potentially overpaying facilities at the taxpayers' expense.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 19 additions

SECTION 1. Chapter 40-8.9 of the General Laws entitled "Medical Assistance — Long- Term Care Service and Finance Reform" is hereby amended by adding thereto the following section: 40-8.9-10. Assisted living community Medicaid rates -- Annual cost-of-living adjustment.

(a) Beginning July 1, 2026, and annually thereafter, the executive office of health and human services (EOHHS) shall apply an automatic cost-of-living adjustment (“COLA”) to the Medicaid reimbursement rates paid for assisted living services provided pursuant to this chapter.

(b) The annual COLA shall be equal to the percentage increase, if any, in the Consumer Price Index for All Urban Consumers (CPI-U), Northeast Region for the most recently completed calendar year, as published by the United States Bureau of Labor Statistics.

(c) The COLA adjustment shall be applied uniformly across all Medicaid-assisted living rate tiers including, but not limited to, acuity-based or service-level rate categories.

(d) The COLA required under this section shall be applied automatically and shall not be subject to annual appropriation approval, rate rebasing, or discretionary adjustment by the executive branch, except as otherwise expressly provided by law.

(e) Nothing in this section shall be construed to prohibit the general assembly from authorizing additional rate increases or rate restructuring beyond the COLA provided in this section.

(f) The EOHHS shall promulgate any rules and regulations necessary to implement this section, including alignment with federal Medicaid requirements and state plan amendments, if required.

SECTION 2. This act shall take effect upon passage and shall apply to Medicaid assisted living rates effective July 1, 2026.