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$12 Billion in Medicaid Funds Restored to Texas Hospitals, Ending Impasse with the Feds

The restoration ends a near year-long dispute and helps hospitals avoid losing $27 million a day, officials said.

  • On Thursday, Governor Abbott announced nearly $12 billion in Medicaid funding will be restored to Texas hospitals, ending a year-long impasse over matching funds for the state's healthcare system.
  • The dispute began late last year over questions regarding how Texas raises more than $4.2 billion in taxes; the Centers for Medicaid Services halted supplemental funding on Sept. 1, threatening hospitals with $27 million in daily losses.
  • Texas Hospital Association CEO John Hawkins said the restoration averted a crisis for the "Texas healthcare safety net," enabling hospitals to focus on "saving lives and caring for Texans."
  • Calling the agreement a "major victory for Texas patients," Abbott thanked the Trump Administration and the Centers for Medicaid Services for ensuring Texans retain access to critical medical care.
  • Two weeks earlier, Abbott sent a letter to Health Secretary Robert F. Kennedy Jr. describing the funding hold as an "economic gun to Texas," an intervention that helped resolve the impasse.
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$12 billion in Medicaid funds restored to Texas hospitals, ending impasse with the feds

It was not immediately clear when the funds would be transferred. Hospitals were slated to lose $27 million a day​.

·New York, United States
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CBS News broke the news in New York, United States on Thursday, September 17, 2026.
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