House committee substitute to the 1st edition removes the content of the previous edition and replaces it with the following. Makes conforming changes to the act's titles.

Appropriates $190 million in nonrecurring funds and associated receipts for 2025-26 from the Medicaid Contingency Reserve to the Department of Health and Human Services, Division of Health Benefits (DHB), to adjust Medicaid funding to account for projected changes in enrollment, enrollment mix, service and capitation costs, and federal match rates, as well as implementation of the Children and Families Specialty Plan in December 2025.

Instructs the four listed local management entities/managed care organizations (LME/MCOs) to make intergovernmental transfers to DHB in an aggregate amount of $18,028,217 for both the 2025-26 and 2026-27 years. Specifies that the due date and frequency of the intergovernmental transfer required by the act will be determined by DHB. Specifies the amounts that each of the four individual LME/MCOs is required to make in each fiscal year. Specifies that in the event that a county disengages from an LME/MCO and realigns with another LME/MCO during the 2025-27 biennium, DHB has the authority to reallocate the amount of the intergovernmental transfer that each affected LME/MCO is required to make under the act, taking into consideration the change in catchment area and covered population, provided that the aggregate amount of the transfers received from all LME/MCOs in each year of the fiscal biennium is achieved.

Effective retroactively to July 1, 2025.