Here’s how it works: Millions of Americans take home less money after government skims off the top of their earnings (taxes) while an equal number of Americans don’t pay taxes at all. Complicit employers under threat of punishment send the juice to Washington so 435 people (Congress) and their bureaucrat lackeys can have their way with it. In this instance, it’s decided to gift $12,000,000,000 to Texas hospitals in order to turbocharge payments from yet another taxpayer funded gift (Medicaid).
Meanwhile back at the ranch, with what’s left of their paychecks, working Texans struggle to afford health insurance that’s so bad they can’t afford to use it either while 435 people and their bureaucrat lackeys enjoy the best health insurance money can buy paid for by the people who can least afford it.
$12 billion in Medicaid funds restored to Texas hospitals, ending impasse with the feds
The announcement ends a nearly year-long dispute with the Centers For Medicare and Medicaid Services over the funding to Texas hospitals, which were slated to lose $27 million a day.
by Terri Langford Sept. 17, 2026 – Texas gets back $12 billion in hospital Medicaid funds from feds
Nearly $12 billion in Medicaid funding to Texas hospitals will be restored, Gov. Greg Abbott said Thursday, ending a near year-long impasse between Texas and the federal government.
“This funding is a major victory for Texas patients,” Abbott said in a statement. “It authorizes nearly $12 billion for hospitals, physicians, rural clinics, nursing facilities, and behavioral health providers that serve patients in every region of our state. Emergency rooms will stay open, rural families will retain local care, and Texans will have access to the treatment they need. I thank CMS and the Trump Administration for helping ensure Texans get the medical care they need.”
Related Story
Texas hospitals say they’re losing $27 million a day in Medicaid funding
Aug. 31, 2026, 8:34 p.m. Central
The halt of the funds began on Sept. 1, the beginning of the state’s new fiscal year. It marked the first time the Centers for Medicare and Medicaid Services had stopped the supplemental funding to Texas hospitals since the funding began in 2014. It was not immediately clear when the funds would be transferred to Texas hospitals, which was slated to lose $27 million a day.
“We can breathe a little easier today. The Medicaid crisis hanging over our heads has been averted. We are deeply grateful to Gov. Abbott, state and federal leaders who listened, took our concerns seriously and acted with urgency to protect Texas patients,” said John Hawkins, president and CEO of the Texas Hospital Association. “Hospitals can focus on what they do best – saving lives and caring for Texans. Our gratitude cannot be overstated.”
Abbott’s announcement comes two weeks after The Texas Tribune reported that the governor’s office had stepped in last month, according to a letter he sent Health Secretary Robert F. Kennedy Jr. in which he called the move to hold onto the money an economic gun to Texas. The funding helps hospitals close the gap between their Medicaid reimbursements and the actual costs they incur for treating low-income Texans.
The dispute began late last year over questions about how Texas raises more than $4.2 billion in taxes to access those federal funds.
Disclosure: Texas Hospital Association has been a major financial supporter of The Texas Tribune. The Texas Tribune is a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in our journalism. Find a complete list of them and more information about our financial and disclosure policies here.
⏳ It’s almost time for The Texas Tribune Festival, Sept. 24–26 in downtown Austin. Go beyond the headlines with 250+ speakers and 100+ sessions digging into democracy under pressure, the battle for Texas, the future of education, AI, energy and more. There’s still a seat waiting for you. Get your tickets today!
TribFest 2026 is presented by JPMorganChase.
Terri Langford is the Tribune’s health services reporter based in Austin. Langford is a veteran journalist, having worked at the Florida Times Union, The Associated Press, The Dallas Morning News, the… More by Terri Langford