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Medicaid Provider Taxes Raise Private Insurance Premiums, ASPE Finds

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By HEOR Staff Writer

October 21, 2026

Global
ASPE finds Medicaid provider taxes raised employer premiums 1.5 to 1.7 percent. The 2025 WFTC law is projected to cut th

Medicaid provider taxes raise what private insurers pay for hospital care, and a new HHS study puts a number on it. An Office of the Assistant Secretary for Planning and Evaluation (ASPE) brief finds that state hospital provider taxes pushed employer-sponsored insurance (ESI) premiums up by 1.5 to 1.7 percent. The study was presented at the ASPE Health Economics and Policy Forum on 20 October 2026, where the lead author and three panelists discussed the likely effects of the 2025 Working Families Tax Cut (WFTC) law.

Source: ASPE, Financing Medicaid Through Provider Taxes on Hospitals: Spillover Effects on Employment-Based Coverage Premiums (Volkov, Mulligan and Bai, 2026).

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