A wage pass-through is a string attached to a rate. The legislature or the Medicaid agency raises what it pays a provider agency, and it requires some share of that increase to show up in workers' pay. Without the string, a higher fee schedule can be absorbed by overtime, insurance, rent, or margin. With the string, the agency has to show that wages moved.
The design arguments are always the same. What percentage has to be passed through. Which job titles count, and whether supervisors and self-directed workers are in the class. Whether benefits count as wages. How soon the raise has to appear. How the state will audit it, and what happens if an agency cannot produce the payroll records. A pass-through with no audit is a press release.
It is not the same tool as a wage floor. A floor sets a minimum hourly rate no matter what just happened to the fee schedule. A pass-through only moves money when there is an increase to move. A state can do both: a floor for the lowest paid hour, and a pass-through so that this year's rate increase does not stop at the executive director. A state can also do neither, and leave the wage inside the agency's discretion.
Rate studies often assume a wage and then build a rate around it. A pass-through is how lawmakers try to make that assumption true after the rate is published. Providers argue about the percentage when the study's wage and the funded rate were already far apart. You cannot pass through dollars the appropriation never included.
This desk treats a pass-through as a claim that can be checked. The check is the payroll, not the bill language.