JACKSON, Miss. (WJTV) – Gov. Tate Reeves (R-Miss.) announced the federal approval of the first component of his Medicaid reimbursement reform plan.

The governor announced the reforms in September 2023. According to Reeves, the reforms are estimated to generate approximately $700 million for hospitals across the state.

“This plan is going to strengthen our state’s healthcare system and I’m glad that we could get it done for the people of Mississippi,” said Reeves. “This is the product of meetings with a range of medical professionals and healthcare leaders, and I’m truly thankful to all of them for helping to get us to today.”

Under the proposal, approved by the Centers for Medicare and Medicaid Services (CMS), hospitals will be reimbursed near the average commercial rate for services provided through the managed care delivery system, which has been considered the federal ceiling for Medicaid reimbursements in managed care.

In total, Reeves said this component of the plan will generate approximately $600 million for Mississippi hospitals.

A second component of the plan supplementing Medicaid hospital payments in the fee-for-service delivery system is still awaiting approval from CMS.

The governor said the Mississippi Division of Medicaid is taking steps to deliver the first round of payments to hospitals in the coming weeks. The effective date of the approval is retroactive to July 1, 2023.