BOSTON (SHNS) – August is coming to a close without a deal on a more than $4 billion economic development bill, but an even pricier piece of unfinished state business is set to bump up against an extended deadline in September.

The state’s Medicaid 1115 Demonstration Waiver, which allows the state to tailor its programs by waiving some Medicaid law provisions, was approved by the former Obama administration in November 2016 and set to expire June 30, 2022. The $52.5 billion waiver facilitated a $1.8 billion effort to transition toward accountable care organization models of care and make investments in behavioral health and long-term care services.

The Baker administration submitted a five-year waiver extension proposal in December 2021, and in June 2022, the Centers for Medicare and Medicaid Services (CMS) approved a temporary extension that runs until Sept. 30, 2022. That means the Biden administration could tip its hand in the coming weeks on its level of cooperation with Bay State health care reforms, and the waiver represents a big piece of final health care business for Gov. Charlie Baker, who is not seeking reelection is and set to leave office in early January.

In a June 9 letter, Judith Cash, director of the State Demonstrations Group at CMS, said the federal agency “strongly supports the goals set forth in the state’s extension proposal,” including continued restructuring and the shift toward “accountable, value-based care,” investing in primary care, behavioral health, and pediatric care, advancing health equity and addressing health-related social needs and disparities, supporting the state’s “safety net,” and maintaining near-universal health insurance coverage. The MassHealth program, also commonly referred to as Medicaid, is the largest single program and cost center in the annual state budget.

MassHealth, which is funded by the state and federal governments, accounted for nearly $19.5 billion in spending in the $52.7 billion fiscal 2023 budget that Gov. Baker signed in late July. The waiver, which has evolved through governorships and presidencies, has long been central to the program’s administration, with the Baker administration saying that since 1997 it “has been a critical tool in enabling Massachusetts to achieve and maintain near-universal coverage, sustain the Commonwealth’s safety net, expand critical behavioral health services, and implement reforms in the way that care is delivered.”

Last Thursday, U.S Health and Human Services Secretary Xavier Becerra and CMS Administrator Chiquita Brooks-LaSure issued a letter to governors inviting them to work with CMS and apply for Medicaid 1115 waivers “to provide increased access to care for women from states where reproductive rights are under attack and women may be denied medical care.”