This Week (October 6-10)

The Senate is in session and discussions on ending the government shutdown may continue. House Leadership has designated this week as a "district work period" and no votes are expected in the House.

Senate Special Committee on Aging will hold a hearing on "Bad Medicine: Closing Loopholes that Kill American Patients."

• Date: Wednesday, October 8 at 3:15pm ET
• More information available here.

Senate Judiciary Intellectual Property Subcommittee will hold a hearing on "The Patent Eligibility Restoration Act — Restoring Clarity, Certainty, and Predictability to the U.S. Patent System."

• Date: Wednesday, October 8 at 2:30pm ET
• More information available here.

Senate Health, Education, Labor and Pensions Committee will hold a hearing on "AI's Potential to Support Patients, Workers, Children, and Families."

• Date: Thursday, October 9 at 10am ET
• More information available here.

Last Week (September 29-October 3)

Congressional Highlights

US government shuts down. On October 1, the federal government began shutdown procedures after the Senate failed to gain the 60 votes needed for the House-passed continuing resolution (CR), which would have temporarily extended funding until November 21. Since the shutdown began, the Senate has continued to hold failed votes on both the House-passed CR (H.R. 5371) and a Democrat alternative (S. 2882) that would fund the government through October 31, permanently extend the enhanced Affordable Care Act (ACA) premium tax credits that expire at the end of 2025, repeal the One Big Beautiful Bill Act's (OBBBA) Medicaid cuts, and limit the authority of the Office of Management and Budget (OMB) to withhold appropriations. The top ask from Democrats is now that a CR extend the enhanced ACA premium tax credits, but Republicans, including President Trump, have urged Democrats to pass the House's CR on the promise of future talks related to extending the tax credits. The House is scheduled to return from recess on Tuesday (October 7) and the Senate is expected to hold another vote on the competing CRs on Monday (October 6). So far, congressional leaders and the White House have made no progress toward an agreement that would end the shutdown, but a bipartisan group of senators have been in discussions.

The Congressional Budget Office estimated about 750,000 federal employees could be placed on furlough. HHS' latest contingency plan stated about 41% of staff would be furloughed. Some staff are able to continue working because their programs are already congressionally funded, have enough funds from the previous fiscal year, or are funded by user fees, while others deemed essential may work without pay. For example, Medicare is funded through mandatory appropriations, meaning fee-for-service claims are expected to continue to be processed and paid. Medicaid, which is subject to annual appropriations, is funded through Q1 of FY 2026 as part of Congress' December 2024 funding bill. In addition, HHS said federal marketplace activities will continue, such as eligibility verification, using Federal Marketplace user fee carryover. CMS has stated that some programs like the Federal Independent Dispute Resolution (IDR) process will remain open, but that a prolonged shutdown could cause delays. Certain NIH activities that will not continue include grant peer review meetings, advisory council meetings, issuance of new awards, and program/grants management activities.

In preparation for a shutdown, OMB also directed agencies to create a list of employees working on programs funded by discretionary appropriations that do not align with the president's priorities to be laid off in the case of a shutdown. Though to date, HHS and other Cabinet-level agencies appear unimpacted.

Without a continuing resolution, several health care extenders also expired, including Medicare telehealth waivers that expanded the types of telehealth services eligible for Medicare reimbursement and enabled Medicare patients in urban areas to receive telehealth services in their home. The Acute Hospital Care at Home (AHCAH) waiver, which allows hospitals to provide acute-level care at home, also expired. CMS has instructed Medicare Administrative Contractors to hold telehealth claims for 10 days, and provided guidance states hospitals that continue Acute Hospital Care at Home programs could receive a "plan of correction" which would provide the hospital with 60 days to respond.

Other health extenders that expired include funding for community health centers, the National Health Service Corps, the Teaching Health Center GME program, low-volume and Medicare dependent hospitals, ground ambulance add-on, special diabetes programs, Medicare quality measure selection, and more.

Sen. Sanders issues report on the president's efforts to lower drug prices. On Monday (September 29), Senate Health, Education, Labor, and Pensions Committee (HELP) Ranking Member Bernie Sanders (I-VT) published a report that states since President Trump took office the prices for 688 drugs have increased by a median of 5.5%.

Administrative Highlights

President Trump and Pfizer unveil first Most Favored Nation deal. On September 30, President Trump and Pfizer CEO Albert Bourla announced the first agreement under President Trump's Most Favored Nation's (MFN) executive order. The agreement, which the Administration is working to replicate with other major drug manufacturers, aims to address global price imbalances and ensure the U.S. is not funding innovation for the rest of the world. While the Administration did not share specific details on the new MFN prices, Medicare Administrator Chris Klomp said the MFN price is based on the net price, which is then indexed to a basket of countries, providing a starting point for negotiations. The deal between Trump Administration and Pfizer included five key pillars:

• Direct access for patients. The Administration will "soon" launch a new direct-to-consumer website, expected in early 2026" called TrumpRx, where companies can sell select drugs at either the full MFN price or the lowest price currently available. The direct-to-consumer portal aims to bypass so-called "middlemen," such as pharmacy benefit managers and increase price transparency. As part of Pfizer's deal, the company will sell select drugs at discounted prices through the new portal.
• MFN pricing for Medicaid. Under the deal, Pfizer will offer "virtually all of its portfolio of drugs at MFN prices available to Medicaid in the near future."
• Future proofing fairness. As part of the deal, Pfizer committed that it will not launch new drugs "at a price that is higher than the other wealthy world" across U.S. markets.
• Shared savings. Medicare Administrator Chris Klomp, who led the MFN negotiations with Pfizer, said that the U.S. Department of Commerce and USTR Greer are working to encourage other countries to pay more for existing medications. The Administration aims to use a portion of those higher foreign prices to fund additional R&D and repatriate a portion to offset prices for existing drugs in the U.S.
• Onshoring. As part of the deal, Pfizer has committed to onshoring 100% of the value of imports into the U.S. President Trump said Pfizer has committed to investing $70 billion to restore domestic manufacturing facilities. In exchange, Pfizer will receive a three-year waiver from proposed import tariffs, contingent on fulfilling those commitments.

President Trump signs EO to accelerate research into pediatric cancer. On September 30, President Trump signed an EO that directs federal agencies to double federal investments into pediatric cancer research and develop innovative ways to use advanced technologies, such as AI to improve diagnoses, treatments, cures, and prevention strategies for pediatric cancer. For example, the EO suggests incorporating AI into clinical trials and predictive modelling. The EO also directs federal health agencies to leverage AI in efforts to improve interoperability and maximize the potential for electronic health records and claims data to inform research into care and treatments. On the same day, HHS announced it would increase funding for the Childhood Cancer Data Initiative from $50 million to $100 million.

FDA seeks comment on AI-enabled medical devices. On Monday (September 30), the FDA published a request for information (RFI) related to measuring and evaluating the performance of AI-enabled medical devices. The RFI asks performance metrics and indicators, real-world evaluation methods, post-market data sources and quality management, monitoring and response protocols, user experience, and other best practices. Comments are due December 1, 2025.

CMS issues final guidance for the IRA's drug price negotiations. On Monday (September 30), CMS issued final guidance for the third cycle of the Inflation Reduction Act's (IRA) Medicare Drug Price Negotiation Program. The final guidance details how CMS will incorporate Part B drugs or biologics into the program, implements the OBBBA's orphan drug exclusion, sets requirements for renegotiation-eligible drugs, and more. CMS in the final guidance did not move forward with a plan to change its fixed combination drug policy, noting it may revisit the topic in next year's guidance. CMS will begin its third cycle of drug price negotiations in 2026, with the negotiated maximum fair prices taking effect on January 1, 2028. CMS is scheduled to announce the 15 Part B or Part D drugs selected for negotiation by February 1, 2026, along with any additional drugs selected for renegotiation. Click here for a fact sheet.

CMS issues revised guidance on emergency Medicaid care for aliens. On Monday (September 30), CMS sent state Medicaid directors letters detailing a change in how the agency interprets payments for emergency services provided to "aliens ineligible for full Medicaid benefits." Under the revised policy, CMS will no longer permit states to contract with Medicaid managed care organizations to provide such services. Instead, states must either use the fee-for-service system and claim the federal financial participation (FFP) for the actual services rendered or states may contract with prepaid inpatient health plans (PIHPs) and prepaid ambulatory health plans (PAHPs) on a non-risk basis to cover the costs of claims for the actual services rendered to treat the emergency. CMS said it does not expect to take enforcement action before the start of the first rating period beginning at least one year following the date of publication.

ICYMI: Health Care Highlights From Recess

Trump administration announcement on autism. On September 22, President Trump and HHS Secretary Robert F. Kennedy held a press conference to share new interagency findings and action plans related to autism. As part of the announcement, HHS and FDA highlighted research indicating a potential correlation between acetaminophen use in pregnancy and increased risk of autism. FDA also on September 22 announced a plan to update the safety label for acetaminophen. Kenvue, which manufacturers Tylenol, refutes the findings. As part of the announcement, the Administration also highlighted an initiative to increase access to autism treatments, and the National Institutes of Health Autism Data Science Initiative announced 13 new awards totaling more than $50 million to research autism prevalence, etiology, and treatment. Click here for a fact sheet. Click here for a press release.

Judge strikes down 2023 RADV rule. On September 25, a federal judge ruled in favor of Humana, vacating a 2023 CMS rule that would have increased risk adjustment data verification (RADV) audits of Medicare Advantage plans. The judge said HHS violated the Administrative Procedure Act of 1946 by failing to properly notify insurers that it was changing the audit rules. The Trump Administration, which has outlined plans to build off of the 2023 rule, has not indicated whether it plans to appeal the ruling.

CMS approves temporary Georgia work requirements waiver extension. On September 23, CMS approved an extension of Georgia's Medicaid work requirement waiver through December 31, 2026. CMS stated it will work with Georgia to ensure compliance with the OBBBA work requirements provision, which takes effect January 1, 2027.

Commerce Department launches new Sec. 232 investigations into PPE and robotics. On September 24, the Bureau of Industry Security (BIS) of the Department of Commerce (Commerce) announced that on September 2, it initiated an investigation under Section 232 of the Trade Expansion Act of 1962 to determine the effects on national security of imports of personal protective equipment (PPE), medical consumables, and medical equipment including devices. BIS also announced it initiated a Section 232 investigation to determine the effects on national security of imports of robotics and industrial machinery, and their parts and components. The Commerce Department is now inviting public comments concerning the investigations by no later than Friday, October 17, 2025.

Trump Admin increases H-1B visa fee. Late September 19, President Trump signed a proclamation that increases the fee for a new H-1B visa to $100,000 effective September 21, 2025. In an FAQ issued on September 21 the U.S. Citizenship and Immigration Services clarified the fee applies only to new visas and would not impact renewals. The change is part of a broader effort to reform the H-1B visa program and address concerns that technology companies are abusing the program and favoring low-wage foreign workers over Americans. Health care organizations, which rely on H-1B visa holders to address workforce shortages, have requested exemptions, and Republican Senators Shelly Moore Capito (R-WV) and Joni Ernst (R-IA) have also expressed concern about the impact on rural health care. An international nurse-staffing agency and several unions have filed lawsuits challenging the change.

Reports, Studies, and Journals

• Government Accountability Office: Urban Hospitals: Factors Contributing to Selected Hospital Closures and Related Changes in Available Health Care Services. The report, which was requested by a bipartisan group of senators, highlighted several factors that contribute to hospital closures in urban areas, including financial declines, aging physical infrastructure, declining volume of inpatient admissions, challenges operating independently, poor management practices, and separate ownership interests.
• Government Accountability Office: Health Care Consolidation: Published Estimates of the Extent and Effects of Physician Consolidation. The report found increased consolidation between physician practices and hospital systems, corporate entities, and private equity firms with such consolidation generally resulting in higher Medicare spending, with no change in quality.
• Government Accountability Office: Veterans Health Care: Better Communication Needed to Integrate Management of Medical Facility and Community-Based Care. The report recommends the Veterans Health Administration ensures the Office of Integrated Veteran Care develops a strategy for clear and continuous two-way communication with employees and stakeholders.