CMS has not approved about $9.8 billion in Texas Medicaid directed payments for the fiscal year that began September 1, most of it hospital CHIRP funding

The Texas Tribune reported August 31, 2026 that federal officials are withholding approval of about $9.8 billion in Texas Medicaid supplemental payments for the fiscal year that began September 1, most of it in the Comprehensive Hospital Increase Reimbursement Program (CHIRP); the Texas Hospital Association says hospitals are losing $27 million a day, and the Tribune reports Harris Health could receive at least $258 million less.

The dispute is over how local jurisdictions calculate the hospital taxes that draw the federal match: HFMA reported that a September 3 CMS letter said the concerns must be resolved before approval, and that the Texas Health and Human Services Commission asked CMS on September 9 not to tie approval to those separate financing discussions.

According to HFMA, CHIRP accounts for more than $9.1 billion of the total, and the other withheld programs help fund Medicaid services provided by medical groups and rural health clinics. The reporting names no FQHC or health-center payment; any effect on Texas health centers would be indirect, through referral capacity, since the hospital association warns of cuts to service lines such as NICU and labor and delivery if approvals stay withheld.