14 April 2025 This Week in Health Policy for April 14 The House and Senate will be in recess until the week of April 28. When Congress returns, House Republicans will begin work on drafting a reconciliation package and identifying health care payfors to include. The House Energy and Commerce Committee also is expected to hold a markup of health care bills on Tuesday, April 29. This Week in Health Policy will not publish while Congress is adjourned. House and Senate clear hurdle to reconciliation process. On Thursday (April 10), the House voted 216-214 to pass the Senate's updated FY2025 budget resolution, clearing the path for using the reconciliation process to pass a bill to extend Tax Cuts & Jobs Act (TCJA) provisions expiring at the end of 2025 with only Republican votes. The Senate-passed resolution requires a lower level of spending cuts and uses a current policy baseline, which eliminates the requirement to offset the cost of the TCJA extensions. While it leaves the House reconciliation instructions unchanged — requiring $2 trillion in deficit reduction as a condition to include a full $4.5 trillion in tax cuts it mandates only nominal savings ($4 billion) from Senate committees. For example, the budget resolution instructs the Senate Finance Committee, which has jurisdiction over Medicaid, to increase the deficit by $1.5 trillion over 10 years, whereas the House Energy and Commerce Committee, which has jurisdiction over Medicaid, is directed to reduce spending by $880 billion. Senate Majority Leader John Thune (R-SD) offered public assurances that GOP Senators are on board with the spending cut targets House Republicans set when they passed their budget instructions February 25. Both the House and Senate have adjourned for a two-week recess, after which, Republicans will be writing a tax bill that also will likely include military spending, energy policy, border security investments, and health care spending cuts — which are needed to offset the cost of the tax cuts. This week, House Energy and Commerce Committee Chair Brett Guthrie (R-KY), who is tasked with coming up with $880 billion in spending cuts, said the Committee could target policies to reduce fraud, waste, and abuse in Medicaid; create Medicaid work requirements; and adjust the federal payment for state Medicaid expansion populations. However, the Committee may also have to look elsewhere for savings with several items on the table, including Medicare site-neutral payments, state provider taxes, Affordable Care Act subsidy reform, and more. House Democrats raise concerns about tariffs and health care. On Wednesday (April 9), a group of 26 House Democrats sent a letter to the Trump administration expressing concern about the impact of tariffs on the medical supply chain, including crucial drugs already in shortage. Trump nominees. On Thursday (April 10), the Senate voted 5 — 46 to confirm Mark Meador, a partner at law firm Kressin Meador Powers and former antitrust counsel to a Republican senator, as the newest commissioner of the Federal Trade Commission. The confirmation brings the number of Republican commissioners to three, while the two Democratic commissioners continue to fight their dismissals in court. CMS issues FY 2026 Inpatient and Long-Term Care Hospital Payment Proposed Rule. On Friday (April 11), the Centers for Medicare & Medicaid Services (CMS) issued the fiscal year (FY) 2026 proposed rule for the Hospital Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) Prospective Payment System, which includes a 2.4% payment bump for acute care hospitals. CMS estimates the overall impact of the rule would increase acute care hospital IPPS payments by about $4 billion in FY 2026, including a $1.5 billion projected increase in Medicare uncompensated care payments to disproportionate share hospitals. CMS noted that under current law additional payments for Medicare-Dependent Hospitals (MDHs) and low-volume hospitals will expire on September 30, 2025, and requires Congress to act to further extend those payments. In the wake of court rulings, CMS proposed to discontinue the low wage hospital index policy. CMS in the rule proposed several changes to hospital quality reporting programs and pay for performance programs, including the removal of health equity and social needs-related measures. CMS also proposed several updates to the Transforming Episode Accountability Model (TEAM) set to begin on January 1, 2026. In the rule, CMS includes a request for information on approaches and opportunities to streamline regulations and reduce burdens on those participating in the Medicare program, as well as a request for information on the anticipated approach to FHIR-based electronic clinical quality measure (eCQM) reporting in quality reporting programs and the potential use of FHIR-based patient assessment instrument reporting for inpatient psychiatric facilities. The rule will be open for comment through June 10. Click here for the proposed rule. Click here for the press release. Click here for the fact sheet. CMS issues FY 2026 hospice proposed payment rule. On Friday (April 11), CMS issued the FY 2026 Hospice Payment Rate Update Proposed Rule. In the rule, CMS proposed increasing payments to hospices by 2.4%, or $695 million for FY 2026, compared with FY 2025, as well as increasing the hospice cap amount for FY 2026 to $35,292.51. CMS also included RFI's on ways to streamline regulations and reduce burdens on those participating in the Medicare program, as well as RFIs on future quality measure concepts for the Hospice Quality Reporting Program. CMS is accepting public comments on the proposals until June 10. Click here for CMS' fact sheet and here for the proposed rule. CMS issues FY 2026 Inpatient Psychiatric Facilities proposed payment rule. On Friday (April 11), CMS issued the FY 2026 Inpatient Psychiatric Facilities (IPF) Prospective Payment System Proposed Rule. In the rule, CMS proposed increasing IPF payments by 2.4%, or $70 million, for FY 2026, compared with FY 2025. CMS proposed updates to the IPF facility-level adjustment factors for teaching status and rural location and updated the regression model used to determine IPF PPS payment adjustments to reflect costs and claims data for FY 2020, 2021, and 2022. CMS proposed updates to the IPF Quality Reporting Program, including removing measures related to health equity, health care worker COVID-19 vaccination rates, and social drivers of health. CMS also included RFI's on ways to streamline regulations and reduce burdens on those participating in the Medicare program. CMS is accepting public comments on the proposals until June 10. Click here for CMS' fact sheet and here for the proposed rule. CMS issues FY 2026 Inpatient Rehabilitation Facility proposed payment rule. On Friday (April 11), CMS issued the FY 2026 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Proposed Rule. In the rule, CMS proposed increasing payments to IRFs by 2.6%, or $295 million for FY 2026, compared with FY 2025. In addition, CMS proposed to update the outlier threshold to maintain outlier payments at 3.0% of total payments. CMS also proposed updates to the IRF Quality Reporting Program, including removing measures related to health care worker COVID-19 vaccination rates and social drivers of health. CMS also included RFI's on ways to streamline regulations and reduce burdens on those participating in the Medicare program, as well as RFIs on future measures on interoperability, nutrition, delirium and well-being; advancing digital quality, and more. CMS is accepting public comments on the proposals until June 10. Click here for CMS' fact sheet and here for the proposed rule. CMS issues FY 2026 Skilled Nursing Facility proposed payment rule. On Friday (April 11), CMS issued the FY 2026 Skilled Nursing Facility (SNF) Prospective Payment System Proposed Rule. In the rule, CMS proposed increasing payments to SNFs by 2.8%, or $ 196.5 million for FY 2026, compared with FY 2025. CMS proposed updates to the Patient Driven Payment Model ICD-10 code mappings and the SNF Quality Reporting Program, including removing data elements related to Social Determinants of Health. CMS also proposed updates to the Value-based Purchasing Program, including the removal of the program's Health Equity Adjustment. The proposed rule also includes RFI's on ways to streamline regulations and reduce burdens on those participating in the Medicare program, as well as RFIs on future measure concepts and data submission deadlines. CMS is accepting public comments on the proposals until June 10. Click here for CMS' fact sheet and here for the proposed rule. ACA tax credit reconcile notices. On Friday (April 11), CMS sent a notice saying the agency in mid-April will begin to send ACA exchange enrollees and tax filers failure to file and reconcile (FTR) recheck notices for plan year 2025. The notice says individuals or households who receive an FTR research notice should file their federal income tax return and reconcile their Advance Premium Tax Credit (APTC) for the applicable tax years. RFK Jr. publishes op-ed on HHS restructuring. On Thursday (April 10), HHS Secretary Robert F. Kennedy Jr. published an op-ed in the New York Post, that discusses the HHS reorganization and efforts to reform the department around the Make America Healthy Again movement. The op-ed said HHS would share more details on the restructuring in June. To date, little information has been shared publicly on the HHS layoffs and restructuring, with media reports providing insights into some of the most impacted agencies and offices. CMS outlines future vision of CMS. On Thursday (April 10), CMS Administrator Mehmet Oz published a policy agenda outlining his vision for the agency. Oz said he aims to "modernize Medicare, the Marketplaces and Medicaid, so Americans get the care that they want, need, and deserve," including access to personalized solutions to help people manage their care and navigate the health care system, hold providers accountable for health outcomes and improve their access to patient data, eliminate fraud, waste, and abuse, and transition the health care system to focus on preventive care. FDA unveils shift away from animal testing. On Thursday (April 10), the FDA announced plans to replace animal testing used in developing monoclonal antibody therapies and other drugs with new approach methodologies (NAMs) data, including AI-based models to predict drug behavior and side effects and testing on lab-developed human organ-like structures. The FDA said it will begin implementation of the new approach immediately and encouraged NAM data be included in investigational new drug applications. The agency within the next year also plans to launch a pilot program allowing select monoclonal antibody-based drug developers to use a primarily non-animal-based testing strategy in close coordination with FDA. CMS ends federal match for non-Medicaid programs. On Thursday (April 10), CMS notified states that the agency informed states it will not approve new or extend existing requests for federal dollars on designated state health programs (DSHPs) and designated state investment programs (DSIPs) that do not align with the administration's Medicaid parameters. The notice cites as examples grants to reduce health insurance costs for childcare providers, funding for non-medical in-home services, such as housekeeping, diversity in medicine initiatives, and high-speed internet for rural health providers. HHS says gender dysphoria not an enforceable disability for nondiscrimination. On Thursday (April 10), HHS clarified that a Biden-era non-discrimination on the basis of disability rule's language including gender dysphoria as a disability to be not enforceable because the language was included in the preamble and not the regulatory text. Federal judge strikes down Biden-era nursing home staff rule. On Monday (April 7), a US District Court for the Northern District of Texas judge ruled that the Biden administration's final rule requiring nursing homes to meet more stringent staffing requirement exceeded congressional authority, citing the Supreme Court's Loper Bright decision. House Republicans had been considering the repealing the rule legislatively as a payfor to offset the costs of a reconciliation package. Trump pauses reciprocal tariffs. On Wednesday (April 9), President Trump issued a 90-day pause on the additional country-specific tariff rates on countries detailed in Annex I (Annex-I.pdf), with the exception of China which continues to face a cumulative 145% tariff rate. The 10% universal tariffs remain in effect as do the sector exemptions for pharmaceuticals and semiconductors, as well as those subject to ongoing Sec. 232 investigations, including copper and lumber articles. The higher individual tariffs are expected to be paused until at least July 9. Trump Admin takes new actions on deregulation. This week, the White House took several actions related to streamlining the regulatory environment:
Senate HELP Committee postponed a markup that was scheduled to include a pediatric cancer bill. The hearing, originally scheduled for Wednesday (April 9), has been postponed to a future date.
On Thursday (April 10), the Committee held a hearing during which members heard from a panel representing technology and security experts, AI companies, and academics. During the hearing, members spoke of the impact of AI in health care, including the potential for AI to improve health care and streamline administrative tasks and the need to ensure AI has appropriate safeguards.
House Oversight and Government Reform Committee held a hearing on "Restoring Trust in FDA: Rooting Out Illicit Products." On Wednesday (April 9), the committee heard from a panel of witnesses representing policy experts, academics, non-profits, and a former FDA official. During the hearing, Republicans spoke of the need to reform the FDA, while Democrats spoke critically about recent FDA layoffs and restructuring plans. Members from both sides of the aisle raised concerns about overreliance on foreign countries as part of the US drug supply chain.
House Energy and Commerce Committee held a markup that includes health legislation. On Tuesday (April 8), the Committee advanced 20 bills, including the Promoting Resilient Supply Chains Act of 2025 (HR 2444), which aims to bolster supply chain resiliency for critical industries, and passed by a vote of 50-1.
House Ways and Means Health Subcommittee will hold a hearing on "Lowering Costs for Patients: The Health of the Biosimilar Market." On Tuesday (April 8), the Health Subcommittee held a hearing during which members heard from a panel representing health care providers, advocates, and researchers who spoke about the need to address barriers to biosimilar entry and use, including addressing pharmacy benefit manager (PBM) rebates and Medicare physician reimbursement for biosimilars. Witnesses were divided on the impact of the Inflation Reduction Act's (IRA) drug price negotiation program on biosimilar innovation.
Government Accountability Office: Drug Shortages: HHS Should Implement a Mechanism to Coordinate Its Activities. The report details the ways in which FDA is working to address drug shortages and provides recommendations for ways HHS could improve its drug shortage activity coordination across agencies. Health Affairs: Estimated Impact Of Medically Tailored Meals On Health Care Use And Expenditures In 50 US States. The study found that medically tailored meals for patients with diet-related diseases and limitations in activities of daily living, covered by Medicaid, Medicare, or private insurance generated net cost saving in the first year in forty-nine states.
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