The following is the latest health policy news from the federal government for November 21 through December 4.  Some of the language used below is taken directly from government documents.

Congress

Congress is back in session to discuss the Affordable Care Act tax credits set to end on December 31and other extenders that will expire on January 30, 2026 along with the latest continuing resolution (CR).

Members continue to negotiate potential solutions to the expiring enhanced Affordable Care Act premium subsidies but there is no consensus on whether or how to address the expiring benefit.  Senate Majority Leader Thune (R-SD) will permit Senate Democrats to present their bill for a vote next week and a Republican bill is also expected – though neither measure is expected to gain the 60 votes needed for passage.  Other bipartisan groups in Congress are discussing various proposals and continue to seek a solution that could pass both chambers.  Lawmakers also are debating whether the end of open enrollment on December 15 or the end of the CR on January 30 will be the cutoff for a deal to address the expiring subsidies.

The current CR funds the federal government until January 30, 2026 and there has been little progress on the remaining appropriations bills.  The House has, however, advanced the Hospital Inpatient Services Modernization Act, which would extend the Acute Hospital Care at Home program for five years, signaling Congress’ potential interest in addressing some extenders apart from the spending bill, depending on each program’s cost analysis.

Medicare Regulations for Calendar Year 2026 – Final Regulations

Medicare Outpatient Prospective Payment System and Ambulatory Surgical Center Final Rule for CY 2026

CMS has published its final regulation governing how it will pay for and regulate Medicare-covered outpatient services in CY 2026.  The highlights include:

  • An increase of 2.6 percent in outpatient and ambulatory surgical center rates.
  • A 0.5 percent clawback of overpayments related to improper underpayments in the 340B program from 2018 through 2022 – a much smaller clawback than CMS’s original two percent proposal.
  • A new site-neutral payment policy for the outpatient administration of drugs that will pay 40 percent of the outpatient prospective payment system rate for administering drugs in excepted off-campus provider-based departments.
  • The addition of 276 procedures to the ambulatory surgical center covered procedures list and the removal of 271 codes from the inpatient only list.
  • The phase-out of the inpatient-only procedures list over the next three years.
  • The introduction of more rigorous hospital price transparency requirements.  (CMS has posted resources to help hospitals comply with these requirements.  Find them here.)
  • Changes in the hospital quality reporting and ambulatory surgical center quality reporting programs.
  • Updated Medicare rates for intensive outpatient program services furnished in hospital outpatient departments and community mental health centers.
  • Changes in how Medicare pays for skin substitute products.
  • A notice of CMS’s intent to conduct a Medicare outpatient drugs acquisition cost survey.

Learn more about the 2026 Medicare outpatient and ambulatory surgical center rule from the following resources:

Home Health Prospective Payment System and DMEPOS Final Rule for CY 2026

CMS has published its final regulation governing how it will pay for and regulate Medicare-covered home health services and durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) in CY 2026.  The highlights include:

  • A 1.3 percent decrease of Medicare payments for home health services – far less than the 6.4 percent cut CMS proposed in June.
  • Recalibration of Patient-Driven Groupings Model case-mix weights and updates of low-utilization payment adjustment thresholds, functional impairment levels, and comorbidity adjustment subgroups.
  • Changes in the face-to-face encounter policy addressing which clinicians can perform such encounters.
  • Changes in the home health quality reporting program.
  • Changes in the Home Health Consumer Assessment of Healthcare Providers and Systems (HHCAHPS) survey.
  • New and revised DEMPOS provider enrollment provisions, including retroactive revocations and additional grounds for revocation or deactivation.
  • Changes in DMEPOS accreditation practices to introduce more frequent DMEPOS supplier surveys and reaccreditations and stricter requirements for becoming and remaining a DMEPOS authorizing organization.

Learn more about these and other aspects of the 2026 Medicare home health prospective payment system rule from the following resources:  this CMS fact sheet; a separate CMS fact sheet on changes in the DMEPOS competitive bidding program; and the final home health and DMEPOS rule itself.

End-Stage Renal Disease (ESRD) Prospective Payment System Final Rule for CY 2026

CMS has issued a final rule updating how it will pay and regulate providers under Medicare’s End-Stage Renal Disease (ESRD) Prospective Payment System in calendar year 2026.  Highlights of the final rule include:

  • An increase of 2.2 percent, to $281.71, in Medicare’s ESRD base rate.
  • A routine annual update of the ESRD wage index system.
  • Updates of the outlier system that reduce the fixed-dollar loss amount for pediatric beneficiaries from $234.26 to $162.43 in CY 2026 and the Medicare allowable payment from $59.60 to $50.19.  For adult beneficiaries, the fixed-dollar loss amount will decrease from $45.41 to $14.80 and the Medicare allowable payment amount will decrease from $31.02 to $23.68.
  • Removing 23 questions from the In-Center Hemodialysis Consumer Assessment of Healthcare Providers and Systems (ICH CAHPS) survey.
  • Finalizing the early termination of the ESRD Treatment Choices Model.

Learn more about the final ESRD rule from this CMS fact sheet and the final rule itself.

Newly Proposed Medicare Regulation

Policy and Technical Changes to the Medicare Advantage Program, Medicare Prescription Drug Benefit Program, and Medicare Cost Plan Program for Contract Year 2027

Among the proposed regulation’s highlights are:

  • The streamlining of Star Ratings by removing measures focused on administrative processes or that do not convey variability in quality among plans.
  • The elimination of the “Excellent Health Outcomes for All” measures that were scheduled to take effect on 2027 and would have rewarded Medicare Advantage plans for high performance among members with social risk factors such as low-income, dual eligibility, and disabilities.
  • Introducing a new Medicare Advantage depression screening and follow-up measure that will begin with the 2029 Star Ratings.
  • A Request for Information on how to modernize Medicare Advantage, improve competition, refine risk adjustment, and better align quality incentives to deliver greater value for beneficiaries and taxpayers.
  • Provisions to codify aspects of the Part D program implemented on a temporary basis under the Inflation Reduction Act of 2022, including eliminating the coverage gap phase; establishing a reduced annual out-of-pocket threshold; removing cost sharing for enrollees in the catastrophic phase; updating true out-of-pocket cost calculations, specialty-tier rules, and reinsurance payment methodologies; and implementation of the selected drug subsidy.

Learn more about the proposed rule from this CMS news release; this CMS fact sheet; and the proposed regulation itself.  The deadline for stakeholders to submit written comments about the proposed rule is January 26.

CMS’s New “ACCESS Model”

CMS and its Center for Medicare and Medicaid Innovation (CMMI) have announced the launch of a new model:  the Advancing Chronic Care with Effective, Scalable Solutions Model, or the ACCESS Model.  The ACCESS Model will test an outcome-aligned payment approach in original Medicare to expand access to new technology-supported care options that seek to help people improve their health and prevent and manage chronic disease.  This voluntary model will focus on conditions affecting more than two-thirds of people with Medicare, including those with high blood pressure, diabetes, chronic musculoskeletal pain, and depression.

The ACCESS Model seeks to give patients in original Medicare more options to help them meet their health goals while giving providers new partners to help them manage their patients’ health by introducing a mechanism for paying care organizations for employing technology-supported services.  The program will seek to reward outcomes rather than defined activities, which CMMI believes will give clinicians greater flexibility to deliver technology-supported care in ways that improve patient health.  The ACCESS Model will run for 10 years beginning on July 1, 2026.

Learn more about the ACCESS Model, including about the program’s goals and design and the criteria for participation, from the program’s web page, which also has an FAQ.  CMMI will solicit potential participants through a request for applications that is not yet available.  The program’s web page offers a link to a mailing list to receive notification when the request for applications is released.  For the program’s first year, which will launch on July 1, 2026, the deadline for submitting applications will be April 1.

Centers for Medicare & Medicaid Services
  • In the wake of passage of the continuing resolution that ended the federal government shutdown, CMS received many questions from states and providers about the manner in which survey, enforcement, and certification activities should accommodate the effects of that shutdown.  Now, CMS has sent a memo to state survey agencies sharing those questions and its responses to them.  Find the CMS memo here.
  • CMS has updated its Medicare telehealth FAQ for calendar year 2026.  Find the updated FAQ here.
  • CMS has posted a bulletin explaining the telehealth waiver for hospitals, physicians, and other clinicians participating in the Transforming Episode Accountability Model (TEAM).  Find that bulletin here.  The waiver and other provisions under the program take effect on January 1.
  • Under the current continuing resolution that ended the federal government shutdown, CMS advises that for all hospitals with active Medicare Acute Hospital Care at Home waivers, all inpatients must be discharged or returned to the hospital on January 30, 2026 in the absence of congressional action to extend the program.  CMS will no longer accept waiver requests for participation in the Acute Hospital Care at Home initiative after January 1, 2026.  Find that CMS noticehere.
  • CMS has announced that it will charge an application fee of $750 in calendar year 2026 for institutional providers that are initially enrolling in the Medicare or Medicaid program or CHIP; revalidating their Medicare, Medicaid, or CHIP enrollment; or adding a new Medicare practice location. This fee is required with any enrollment application submitted in 2026.  Learn more from this CMS notice.
  • CMS has posted a bulletin explaining a new edit for the billing of outpatient services for hospice patients.  Find that bulletin here.  The new edit takes effect on April 1, 2026.
  • CMS has posted a bulletin with the annual update of its therapy code list for 2026.  The updated codes affect therapists (physical therapists, occupational therapists, and speech-language pathologists), physicians, certain non-physician practitioners, and other providers billing Medicare Administrative Contractors (MACs) for therapy services.  The bulletin includes new codes and revised code descriptors.  Find it here.  The updated codes take effect on January 1.
  • CMS has published additional details about its survey of hospitals regarding their acquisition costs for separately payable drugs.  This survey is widely believed to be a step toward re-implementing Medicare payment reductions for 340B-acquired outpatient drugs.  Learn more from this CMS notice (note:  clicking this link automatically downloads the notice).
  • CMS has published additional details about its process for negotiating drug prices for 2028 under the Inflation Reduction Act.  Learn more from this CMS notice (note:  clicking this link automatically downloads the notice).
  • CMS has finalized paperwork reduction act changes addressing price transparency requirements that require hospitals to make public a list of their standard charges.  As described in the final 2026 Medicare outpatient prospective payment system rule, the changes take effect on January 1 but will not be enforced until April 1, 2026.  Learn more from this CMS notice (note:  clicking this link automatically downloads the notice).
  • CMS has announced that through the Medicare Drug Price Negotiation Program it has negotiated lower prices for Medicare patients for 15 widely used and high-cost prescription drugs that treat cancer, diabetes, asthma, and other chronic illnesses and that these lower prices, which will take effect in 2027, should generate $12 billion in overall savings while saving Medicare Part D participants $685 million in out-of-pocket costs.  Learn more about the latest round of drug price negotiations from this CMS news release and about the individual drugs and the specific savings projections from this CMS summary.
  • These newly negotiated prices are part of the second cycle of negotiations under the Medicare Drug Price Negotiation Program, which was created by the Inflation Reduction Act of 2022.  Now, CMS has posted its final guidance for the third cycle of those negotiations; find that guidance here.
  • CMS will share certain Medicaid information with the U.S. Department of Homeland Security (DHS) and its Immigration and Customs Enforcement (ICE) agency, consistent with federal laws requiring the provision of information to DHS.  CMS receives information related to immigration status because it is relevant to the Medicaid program, such as for calculating federal Medicaid matching funds for the states.  While CMS had previously stated on its web site that the information it collects regarding individuals will only be used for the administration of its programs and that it will not use immigration status for immigration enforcement purposes, new guidance states that “Federal laws govern the collection, use, and disclosure of CMS information.”  Learn more about this policy, including its underlying rationale, from this CMS notice.  The policy takes effect immediately.
  • CMS has posted a notice announcing its annual adjustment in the amount in controversy (AIC) threshold amounts for Administrative Law Judge (ALJ) hearings and judicial review under the Medicare appeals process. The adjustment, which takes effect for requests filed after January 1, changes the threshold amounts to $200 for ALJ hearings and $1,960 for judicial review.  Find the CMS notice here.
  • CMS has repealed its 2024 regulation that introduced minimum staffing requirements for nursing homes participating in Medicare and Medicaid.  According to CMS, implementing the long-term care facility staffing rule “… disproportionately burdened facilities, especially those serving rural and Tribal communities, and jeopardized patient’s access to care.”  Learn more from this HHS news release and the formal repeal of the regulation.
  • CMS will be expanding its Review Choice Demonstration for Inpatient Rehabilitation Facility (IRF) Services in Texas and California effective March 2, 2026 and May 1, 2026, respectively.  In anticipation of those deadlines, CMS has published other deadlines for new participants to choose how they will be paid under the program.  Find this schedule and more on the Review Choice Demonstration for Inpatient Rehabilitation Facility Services web page.
  • CMS has updated its Electronic Clinical Quality Control Improvement (eCQI) Resource Center with new data on MIPS Value Pathways (MVPs) and Reporting Options pulled from the Quality Payment Program (QPP) website.  Learn more here.
  • CMS has added the following items to its Quality Payment Program resource library.  (Note:  clicking these links may give a prompt to download a file that may be a zip file.)
Department of Health and Human Services
  • HHS has issued a letter to health care providers and organizations reminding them about federal law requiring them to give parents access to their children’s health information.  In addition, HHS directed HRSA to add a grant requirement stating that all funding recipients must comply with all applicable federal and state parental consent laws for any services or care provided to minors at HRSA-supported health centers as a condition of receiving health center program funds.  Find the letter to providers here and learn more about this issue from this HHS news release.
  • HHS’s Substance Abuse and Mental Health Services Administration (SAMHSA) has asked the Office of Management and Budget to approve a new data collection effort to learn more about state-level programs to reduce underage drinking.  SAMHSA envisions a survey of the states and their efforts to reduce underage drinking, but much of the data that states would be asked to submit would come from their various partners in such endeavors, such as community organizations that include providers.  Learn more about the proposed new data collection from this SAMHSA notice.  The deadline for submitting written comments is December 24.
  • HHS’s Office of the Assistant Secretary for Planning and Evaluation (ASPE) has published an issue brief exploring opportunities that technology-enabled care offer to help meet patient and provider needs for high-valued coordinated care to improve health outcomes.  The brief explores literature surrounding existing available technology-enabled care options and economic and payment issues that influence whether this is adopted.  Learn more from the ASPE report “Opportunities for Technology-Enabled Care:  Economic and Payment Issues.”
  • In a new blog post, HHS’s Office of the Assistant Secretary for Technology Policy (ASTP) addresses some of the non-technical challenges to greater health information exchange under the Trusted Exchange Framework and Common Agreement (TEFCA).  Find that commentary here.
  • HHS’s Advanced Research Projects Agency for Health (ARPA-H) will spend up to $100 million on the development of more quantitative measures of mental and behavioral health through its new Evidence-Based Validation & Innovation for Rapid Therapeutics in Behavioral Health (EVIDENT) initiative.  EVIDENT will pursue two foundational components for improving behavioral and mental health care:  more robust data on individual clinical outcomes and patients’ unique responses to novel treatment approaches.  Establishing such objective measures of mental and behavioral health, the agency believes, will accelerate innovative diagnostics and treatments for these disorders.  Learn more about the program and its funding from this ARPA-H announcement, which includes a link to more information about the program and how to pursue funding.  The deadline for submitting questions about the program is December 12 and proposals are due by December 22.
HHS/Office of the Inspector General
  • Medicare payments for continuous glucose monitors and supplies exceeded supplier costs and retail market prices, suggesting that Medicare can save at least tens of millions of dollars in one year, HHS’s Office of the Inspector General (OIG) concluded after a recent audit.  Learn more about the problem CMS identified and how it recommended that CMS correct it from this OIG report.
  • Four of 30 dental providers audited by the OIG did not comply with the terms, conditions, and federal requirements for expending Provider Relief Fund payments, the agency has reported.  Learn more about the extent of the problem the OIG uncovered and its recommendation for recovering this inappropriate spending from this report.
  • Gaps in NIH oversight of medical resources put millions of dollars in funding for other transactions at greater risk of fraud, waste, or abuse, the OIG has concluded after a recent audit.  Learn more about what the OIG found and the steps it recommended to the NIH for addressing this problem from this OIG report.
Medicaid State Plan Amendments

CMS has approved the following state plan amendments for Medicaid and CHIP programs.

  • To Kansas, updating nursing facility rates for state fiscal year 2026.
  • To Arizona, updating the fee schedule effective date for outpatient hospital services.
  • To Arizona, updating the state’s disproportionate share hospital (DSH) pool 5 payment amounts and participant list for the DSH state plan rate year ending 2024.
  • To Florida, updating provisions as authorized in the General Appropriations Act for state fiscal year 2024-2025 and making technical and editorial changes.
  • To Florida, authorizing reimbursement for carved-out drugs at a rate equivalent to the wholesaler or provider actual acquisition cost.
  • To Rhode Island, revising the nursing facility reimbursement methodology by updating the direct care rate component to use the Patient-Driven Payment Model (PDPM) nursing case-mix component in place of the Resource Utilization Group (RUG-IV) methodology.  The state plan amendment also provides for a 5.3 percent rate increase.
  • To Washington, updating the effective date of several Medicaid fee schedules and conversions factors.
  • To Washington, changing the operation status from a Medicaid Recovery Audit Contractor (RAC) exception to the acquisition of a Medicaid RAC.
  • To Texas, updating Community First Choice fees schedules and discontinuing the attendant compensation rate enhancement program.
  • To Nevada, providing mandatory coverage for eligible juveniles who are incarcerated in a public institution post-adjudication of charges.
  • To Minnesota, updating the clinic services benefit pages in the state plan using OMB’s/CMS’s required state plan amendment template.
  • To Louisiana, adding a new targeted case management target group – eligible beneficiaries birth through 25 years of age requiring the use of mechanical ventilation – to the targeted case management Medicaid benefit.
  • To Pennsylvania, updating Attachment 4.19D Part I Supplement I to reflect recent changes made due to the state’s amendment of a data element in its case-mix payment system for nursing facilities and county nursing facilities to use the Patient Driven Payment Model (PDPM) in place of the Resource Utilization Groups, Version III (RUG-III) classification system to set Medical Assistance payment rates for nursing facilities.
  • To Pennsylvania, amending a data element in the state’s case-mix payment system for nursing facilities and county nursing facilities to use the Patient Driven Payment Model (PDPM) in place of the Resource Utilization Groups, Version III.
  • To South Dakota, implementing an inflationary increase to reimbursement rates for home health services.
  • To Missouri, to reimburse ophthalmologists 85 percent of the Missouri Locality 01, 2023 rates.
State-Directed Medicaid Payments

CMS has approved three applications for Medicaid state-directed payments from the state of Arizona.

  • For a uniform increase for the eligible public safety-net hospital established by the state for inpatient and outpatient hospital services for the rating period covering October 1, 2025 through September 30, 2026, to be incorporated into the capitation rate through a separate payment term of up to $522 million.
  • For a uniform increase for inpatient and outpatient hospital services at freestanding children’s hospitals with more than 100 licensed pediatric beds for the rating period covering October 1, 2025 through September 30, 2026, to be incorporated into the capitation rates through a separate payment term of up to $105 million.
  • For a uniform percentage increase, entitled Access to Professional Services Initiative, established by the state for qualified practitioners affiliated with one of the designated hospitals for the rating period covering October 1, 2025 through September 30, 2026, to be incorporated into the capitation rate through a separate payment term of up to $338 million.
HHS Newsletters, Reports, and Videos
  • CMS – MLN Connects – November 26 and December 4
  • CMS – Expanded Home Health Value-Based Purchasing (HHVBP) Model – December newsletter
  • CMS/CMMI – CMMI has posted the seventh annual report and associated materials for its Comprehensive Care for Joint Replacement Model.  Find those materials here, here, here, and here.
  • Agency for Healthcare Research and Quality – AHRQ News Now – November 18, November 25, and December 2
  • HHS/Health Resources and Services Administration (HRSA) – Organ Procurement and Transplantation Network – OPTN Monthly Update – November 2025
  • HRSA has posted a video demonstrating how applicants, grantees, providers, consultants, and technical analysts can log into their HRSA electronic handbooks (EHBs).  Find it here.
  • HRSA has posted three videos on its data warehouse and how interested parties can use it.  One video presents the data warehouse’s new web page, another explains how to navigate the data warehouse, and a third describes how to download from the data warehouse.
  • CDC – Mortality and Morbidity Weekly Report – “Nirsevimab Effectiveness Against Intensive Care Unit Admission for Respiratory Syncytial Virus in Infants – 24 States, December 2024–April 2025,” November 20.
  • CDC – Mortality and Morbidity Weekly Report – Notes From the Field:  Severe Illnesses After Self-Injection of Botulinum Toxin Purchased Online –  New York, Texas, and Wisconsin, 2025,” November 27.
Centers for Disease Control and Prevention (CDC)

The CDC has updated its data on measles cases and outbreaks.  Find the updated data and other measles-related information and resources here.

MedPAC and MACPAC

The Medicare Payment Advisory Commission (MedPAC) and the Medicaid and CHIP Payment and Access Commission (MACPAC) have issued “Beneficiaries Dually Eligible for Medicare and Medicaid,” their annual joint data book presenting information on the demographic and other personal characteristics, expenditures, and health care utilization of individuals who are dually eligible for Medicare and Medicaid.  As the agencies note, dually eligible beneficiaries receive both Medicare and Medicaid benefits by virtue of age or disability and low income.  The design of these programs creates particular challenges for efficient, effective health care delivery and the existence of separate funding streams can create barriers to coordination of care for dually eligible beneficiaries, which in turn can lead to increased costs and poor health outcomes.  These issues are of particular concern because of the significant health needs of many dually eligible beneficiaries and because this group accounts for a disproportionate share of both Medicare and Medicaid spending.  Find the data book here.

Government Accountability Office (GAO)

A GAO review of the advance premium tax credit under the Affordable Care Act suggests a risk of fraud associated with obtaining those credits.  Learn more about what the GAO found when it created fictitious identities and attempted to secure tax credits for the purchase of marketplace insurance from this GAO report.

Congressional Budget Office (CBO)

With recent data suggesting that federal spending on the Medicare Part D benefit, which covers prescription drugs sold in retail settings, will increase much more in 2026 than the CBO and others previously projected, the CBO has issued a call for new research on spending under Medicare Part D.  Learn more about the circumstances that led the CBO to this conclusion and the research it believes would be useful from this CBO commentary.

Stakeholder Events

CDC – 2025 – 2026 Clinical Recommendations for Seasonal Influenza Prevention and Control – December 11

The CDC will hold a webinar for clinicians on Thursday, December 11 at 2:00 (eastern) during which presenters will provide an overview of influenza and discuss recommendations for influenza vaccination, testing, and treatment for people of all ages for the 2025-2026 season.  Go here to learn more about the call and its objectives, the presenters, continuing education credits for participants, and how to participate.

MACPAC – Commissioners Meeting – December 11-12

MACPAC’s commissioners will hold their next public meeting virtually on Thursday, December 11 and Friday, December 12.  Go here to register to participate.

CMS – Healthcare Common Procedure Coding System (HCPCS) Level II public meeting – December 17

CMS will hold a virtual Healthcare Common Procedure Coding System (HCPCS) Level II public meeting on Wednesday, December 17 at 9:00 (eastern) to discuss its preliminary coding, Medicare benefit category, and Medicare payment determinations, if applicable, for new revisions to the HCPCS Level II code set for non-drug and non-biological items and services.  Learn more about the meeting, including how to register and how to participate, from this CMS notice.

AHRQ – Prepping for the Future:  Digital Solutions for Aging Populations – December 17

HHS’s Agency for Healthcare Research and Quality (AHRQ) will hold a webinar on “Prepping for the Future:  Digital Solutions for Aging Populations” on Wednesday, December 17 at 1:30 (eastern).  AHRQ’s presenters will share research on how digital tools can improve health outcomes for older adults, explore barriers to adoption, and discuss strategies to ensure that these technologies are accessible, user-friendly, and effective.  Learn more about the webinar, continuing education credits for participating, and how to register from this AHRQ notice.

HHS/Office of the Assistant Secretary for Technology Policy – ASTP Annual Meeting – February 11-12, 2026

HHS’s Office of the Assistant Secretary for Technology Policy will hold its annual meeting in Washington, DC on February 11-12, 2026.  The meeting will include in-person education and plenary sessions and networking opportunities for the health IT community.  The main stage plenary sessions will also be available for viewing online.  ASTP will soon post information on the meeting’s agenda, how to register, and how to reserve a hotel room through ASTP’s room block.  When it does, that information will be posted here.