27 May 2025 This Week in Health Policy for May 26 Congress is out this week for Memorial Day. This Week in Health Policy will not be published while Congress is out, though health alerts will be issued as events warrant. Reconciliation update. On Thursday (May 22), the House voted 215-214 to pass the Republican-only budget reconciliation bill to extend Tax Cuts & Jobs Act (TCJA) provisions expiring at the end of 2025, provide border security funding, and cut mandatory spending, including through Medicaid changes. Two Republicans voted against the bill and 1 voted "present." Republican leaders were able to secure the near-unanimous support of their members despite persistent concerns among factions of members who felt the approach to deficit reduction taken in the House bill was not sufficient and others who viewed the proposals and attempts to deepen them as too severe. President Trump also intervened to convince members to vote for the "One Big, Beautiful Bill." The bill contains several provisions impacting Medicaid and the Affordable Care Act exchanges, as well as provisions related to pharmacy benefit managers, addressing the IRA's drug price negotiation program's treatment of orphan drugs, expanding availability of ICHRAs, health savings accounts, and other tax-preferred accounts, and more.
House China Select Committee warns of China's AI risks. On Friday (May 23), the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party sent a letter to the Department of Commerce urging the Department's AI Safety Institute to work to address national security risks posed by China's progress in AI, including biological technology. Cassidy blocks Sanders' MFN bill. On Wednesday (May 21), Sen. Bernie Sanders (D-VT), ranking member of the Senate Health, Education, Labor and Pensions (HELP) Committee, reintroduced his Most Favored Nation's (MFN) bill to link US drug prices to those abroad. However, HELP Committee Chair Bill Cassidy (R-LA) blocked Sanders' effort to fast-track the bill through unanimous consent, saying he is working on alternative legislation. MAHA Commission issues report on children's health. On Thursday (May 22), the Make America Healthy Again (MAHA) commission published is first report on children's health. The report provides insight into areas the Trump administration will focus, with sections on ultra-processed food, environmental chemicals, digital tools and physical activity, and drugs and vaccines. As part of the announcement, the US Secretary of Agriculture Brooke L. Rollins announced that she will enable states to submit waivers to remove unhealthy beverages or food from the Supplemental Nutrition Assistance Program, or "SNAP." Trump Admin issues RFI on prescription drug price transparency. On Thursday (May 22), the Departments of Labor, Health and Human Services (HHS), and Treasury issued a request for information seeking public input on how to improve the payer price transparency requirements related to prescription drug prices. The agencies also released an FAQ on the implementation status of the payer price transparency rules and details timeframes and plans to optimize the rule's technical requirements with the goal of reducing duplicate or redundant data, requiring a new Table of Contents file, and creating a more user-friendly experience. The Departments said they expect to issue rulemaking, with the final rule coming by October 1, 2025, and full compliance required by February 2, 2026. CMS updates hospital price transparency guidance. On Thursday (May 22), the Centers for Medicare and Medicaid Services (CMS) updated hospital price transparency guidance in alignment with President Trump's February 25 executive order. The updated guidance requires hospitals to post payer-specific standard charges as dollar amounts in their machine-readable files (MRFs) whenever calculable. This includes the amount negotiated for the item or service, the base rate negotiated for a service package, and a dollar amount if the standard charge is based on a percentage of a known fee schedule. Specifically, CMS said hospitals should discontinue encoding "999999999" in the estimated allowed amount data element and instead use an actual dollar amount. FDA to reject data generated at two Chinese testing firms. On Thursday (May 22), the Food and Drug Administration's (FDA) Center for Devices and Radiological Health sent General Correspondence Letters to two third-party testing companies located in China stating that the agency "will reject those testing facilities' data generated for use in premarket device submissions" in light of evidence that the companies have falsified or had invalid data. CMS to ramp up MA plan audits. On Wednesday (May 21), CMS announced that effective immediately it will conduct Risk Adjustment Data Validation (RADV) audits for all eligible Medicare Advantage (MA) contracts for each payment year and unveiled a plan to leverage new technology and an enhanced workforce of medical coders to complete a backlog of audits for payment years 2018 through 2024. FDA offers new flexibility for drug importation program applications. On Wednesday (May 21), the FDA announced new steps intended to increase states' use of the pathway to import certain prescription drugs from Canada. FDA said states and tribes would be able to draft a proposal for pre-review and meet with the agency to receive feedback before submitting formal proposals for a Section 804 Importation Program. FTC renews drug patent challenges. On Wednesday (May 21), the Federal Trade Commission sent warning letters to several drug manufacturers and informed the FDA that it disputes the appropriateness or more than 200 patient listings in the FDA's Orange Book. The patent listings span 17 different brand-name products and are listings the agency has challenged in the past. CMS Innovation Center unveils ACO REACH updates. On Wednesday (May 21), the Center for Medicare and Medicaid Innovation (Innovation Center) said it will update the ACO REACH model for performance year 2026. CMS said it will make six adjustments to the program including updates to financial benchmarks and risk score formulas. HHS offers initial details into MFN price targets. On Tuesday (May 20), HHS announced that the Most Favored Nation's target price would be based on the lowest price in an OECD country with a GDP per capita of at least 60% of the US GDP per capita. HHS said the MFN would focus on "all brand products across all markets that do not currently have generic or biosimilar competition." The announcement comes after President Trump on May 12 signed his MFN executive order which gives HHS 30 days, from the date of the order, to communicate MFN price targets to drug manufacturers. HHS said officials would highlight commitments from drug companies "in the coming weeks." FDA publishes new framework on COVID-19 vaccines. On Tuesday (May 20), FDA Commissioner Marty Makary and Center for Biologics Evaluation and Research Director Vinay Prasad published a new framework for COVID-19 vaccines in the New England Journal of Medicine. The framework limits the population of people eligible for COVID-19 vaccines to people 65 and older and those ages 6 months to 64-year-old who are at higher risk of severe disease. In addition, FDA recommends COVID-19 vaccine manufacturers conduct post market placebo-controlled studies for healthy people ages 50 to 64 years old. The announcement came days before the Vaccines and Related Biological Products Advisory Committee met on Thursday (May 22) to discuss which strain the COVID-19 vaccine should target in the next respiratory disease season. The panel unanimously recommended the vaccine be monovalent JN.1. Click here to watch the webcast on the new framework. FDA to update REMS website. On Tuesday (May 20), FDA posted a notice that in two weeks it will update its website on risk evaluation and mitigation strategies (REMS) for drugs to reflect REMS changes that have been approved since January 31, 2025. The notice was first mentioned in a court filing in a case challenging HHS' removal of webpages to comply with President Trump's executive orders on DEI and gender ideology. Court challenges. Court cases challenging executive and administrative actions continue to be filed and appealed:
Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies held a hearing on "A Review of the President's Fiscal Year 2026 Budget Request for the Department of Health and Human Services." On Tuesday (May 20), the Subcommittee heard testimony from HHS Secretary Robert F. Kennedy Jr. While Republicans largely spoke in support of HHS' proposed cuts and restructuring plans as a way to address fraud, waste and abuse, some Republicans echoed concerns raised by Democrats about the potential impact of proposed cuts and asked for the Secretary to share more detailed information on the reorganization. Throughout the hearing, Secretary Kennedy said he would be responsive to members' requests but noted ongoing legal activity prevented him from sharing certain details about the reorganization.
Senate Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies held a hearing on "A Review of the President's Fiscal Year 2026 Budget Request for the Food and Drug Administration." On Thursday (May 22), the Subcommittee heard testimony from FDA Commissioner Marty Makary who stated in his opening remarks that the agency is requesting $6.8 billion for 2026, with $3.6 billion coming from industry user fees. The budget request, which was not included in President Trump's skinny budget request for fiscal year 2026, is about a 5.5% reduction from the agency's $7.2 billion budget for 2025. During the hearing, Makary fielded questions on an array of topics, including the FDA's restructuring plans, drug approvals, including those for rare diseases, AI, vaccines, and more. During the hearing, Commissioner Makary assured members that FDA approvals are happening on time and defended his position that scientific researchers have not been impacted by the reduction in force notices. When asked about staff layoffs' impact on facility inspections, Commissioner Makary said they have no backlogs of food inspections but did not mention drug or medical device facility inspections. Commissioner Makary also expressed support for changing the FDA's biosimilar interchangeability designation.
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