This bill mandates that managed care organizations reimburse health care providers for gross receipts taxes incurred while providing services to Medicaid recipients. Specifically, when a health care provider enters into a contract with a managed care organization for Medicaid reimbursement, the organization is required to reimburse the provider for all applicable gross receipts taxes. Additionally, the managed care organization must provide documentation that clearly separates the Medicaid reimbursement amount from the gross receipts taxes paid to the provider.

The bill also defines key terms, including "managed care organization" as entities eligible for risk-based prepaid capitation agreements to deliver health care services, and "Medicaid" as the federal-state program governed by specific titles of the federal Social Security Act. The provisions of this act are set to take effect on January 1, 2026.