This letter supports a demonstration grant application from HL Consulting and JH Cohn, LLP to test procedural changes and innovative technology for hospital reimbursements through Medicaid. The goal is to save state and federal budgets. The letter proposes using objective, data-driven procedures for cost report audits and implementing technologies already used for Medicare that have not been applied to Medicaid cost reporting. This could benefit and serve recipients of long-term healthcare programs while reforming healthcare reimbursement regulations.