Ohio's and Michigan's Sales and Use Taxes on Medicaid Managed Care Organization Services Do Not Meet Broad-Based Requirement 

If a State taxes Medicaid managed care organizations (MCOs), the tax must extend to both Medicaid and non-Medicaid MCOs (i.e., be broad based) to comply with Federal requirements. At the time of our audit in 2016, two States did not meet Federal requirements stating that taxes on MCOs be broad based. Specifically, Ohio and Michigan continued to tax only Medicaid MCOs under their sales and use tax programs. Ohio stated that it would work with the Centers for Medicare & Medicaid Services (CMS) to address changes that might need to be made to its tax.