Missouri likely to curb hospital Medicaid payments

JEFFERSON CITY | Gov. Jay Nixon's administration wants to curb an arrangement that has given hundreds of millions of dollars of extra Medicaid payments to hospitals.

A former official at the Department of Social Services tells The Associated Press that the agency created the hospital payment plan as a way to "soften the impact" of the 2005 Medicaid cuts.

But the department now says the move has resulted in "inflated estimates" of the number of hospital patients covered by Medicaid, which has led to overpayments.

A proposed rule published last week would change the way the state calculates hospital Medicaid payments. The change is projected to reduce Medicaid payments to hospitals by $139 million annually.