The following is the latest health policy news from the federal government for September 12-18.  Some of the language used below is taken directly from government documents.

Congress
  • Funding for the federal government expires on September 30.  Members of Congress have not yet coalesced around a plan to fund the federal government when the new federal fiscal year begins on October 1, with House Republican and Democratic leaders releasing competing legislative texts for a short-term continuing resolution (CR).
    • House Republicans have proposed a CR to last through November 21 with very few anomalies, or policy changes, outside of regular spending.  Importantly, the Republican bill includes the expiring health care extenders – delays to Medicaid DSH cuts, telehealth and Acute Hospital at Home program flexibilities, the low-volume hospital adjustment program, and others – for the duration of the CR.
    • Democratic leaders Senator Schumer and Majority Leader Jeffries have proposed a CR through October 31 that also includes the health care extenders for the length of the CR but adds a permanent extension of the Affordable Care Act’s enhanced premium tax credits and would repeal the health care provisions of H.R. 1, the reconciliation bill that passed earlier this year.

House leaders plan to bring the Republican bill to the floor for a vote on Friday, September 19.  If it passes, this would enable the Senate to take up the bill next week.  While it is possible – though not guaranteed – that House Republicans can pass a CR without Democratic support, any bill that that goes to the Senate will require 60 votes to pass.  This means that even if all Republicans support the bill, it will still require the support of at least seven Democrats.  Democratic leaders intend to use their proposed CR to force Republicans to enter into negotiations on the spending bills.

  • 141 House members have signed a bipartisan letter to House leadership urging them to include in expected spending legislation a measure delaying cuts in Medicaid DSH allotments to the states scheduled to take effect on October 1.  As noted above, ASH supported this effort by sending a message to all House members asking them to sign onto the letter and by asking ASH members to contact their House members directly.  Find the bipartisan House letter here.
Rural Health Transformation Program

CMS has unveiled details on how states can apply to receive funding from the $50 billion Rural Health Transformation Program to strengthen health care across rural America.  This program is designed to empower states to transform the existing rural health care infrastructure and build sustainable health care systems that expand access, enhance quality of care, and improve outcomes for patients.  CMS invites all 50 states to apply for funding to address each state’s specific rural health challenges.  The program has five strategic goals:  to improve the health of residents of rural areas; sustainable access; workforce development; innovative care; and tech innovation.  The $50 billion program funding will be allocated to approved states over five years, with $10 billion available each year beginning in FY 2026.  Funding is available only to states, not to providers, although states may choose to involve providers in their applications and programs.  Applications must come from a state government agency or office and include a letter of endorsement signed by the governor.

Half of the Rural Health Transformation Program funding will be evenly distributed to all states with an approved application and the other half will be awarded to approved states based on individual state metrics and applications that reflect the greatest potential for and scale of impact on the health of rural communities.  The deadline for states to apply is November 5.  There is only one opportunity to apply for funding and one application period for this program.  CMS will announce awards by December 31.  Learn more from this CMS news release; the Rural Health Transformation web page; and CMS’s formal notice of funding opportunity, the web page for which has attachments.  In addition, CMS will hold webinars for applicants for Rural Health Transformation Program grants on Friday, September 19 at 3:00 (eastern) and on Thursday, September 25 at 3:00 (eastern).  Go here to participate in the September 19 webinar and go here to register to participate in the September 25 webinar.

Centers for Medicare & Medicaid Services
  • CMS and HHS’s Substance Abuse and Mental Health Services Administration (SAMHSA) have sent a memo to state health officials detailing best practices for implementing a continuum of crisis services, notably those involving behavioral health and substance use disorders, under Medicaid and CHIP.  Learn more from this CMS guidance letter.
  • CMS has published a quarterly update of its fee schedule for durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS).  The updates it presents take effect October 1.  Find the bulletin here.
  • CMS has introduced minor technical revisions of a recent bulletin presenting its billing for laboratory-specific collection travel allowance policy, which takes effect next April.  Find the revised bulletin here.
  • CMS has updated its National Coverage Determination (NCD) dashboard to reflect current lists of open NCDs, finalized NCDs, pending transitional coverage for emerging technologies topics, and accepted NCD requests.  Find the updated dashboard here.
  • The CMS Hospital Quality Reporting System is currently doing research on electronic measures and is looking for quality staff/directors and IT staff who would be willing to talk about their experiences with data collection and submissions for the eCQMs.  CMS also is interested in gathering views about Fast Healthcare Interoperability Resources (FHIR).  Learn more about what the program seeks and how to participate from this CMS notice.
  • CMS has posted updated materials for the long-term care hospital (LTCH), inpatient rehabilitation facility, and skilled nursing facility quality reporting programs.  Learn more from this CMS notice.
  • A CMS campaign to help finance improvements in nursing home staffing with the proceeds from civil money penalties, originally expected to begin in the spring, has been delayed but the agency still intends to move forward with this effort in partnership with the states.  Learn more from this CMS letter to governors.
  • CMS has added the following items to its Quality Payment Program resource library.  (Note:  clicking these links automatically downloads PDF files.)
Department of Health and Human Services
  • HHS’s Health Resources and Services Administration (HRSA) has sought approval from the Office of Management and Budget for a new data collection instrument to support its 340B Rebate Model Pilot Program as a voluntary mechanism for qualifying drug manufacturers to implement 340B ceiling prices on selected drugs for covered entities.  This information collection request includes the collection of 340B Rebate Model Pilot Program plans from drug manufacturers; the collection of reports from drug manufacturers for evaluation of the pilot program and for overall 340B program surveillance; and the collection of data submitted by covered entities to manufacturers to request rebates.  Learn more from this HRSA notice.  The deadline for stakeholders to submit comments about the proposed data collection is November 12.
  • A new HRSA study concludes that home visiting services improve family well-being.  According to the study, direct interaction between home visitors and families had statistically significant, long-term positive effects on maternal and family well-being outcomes by the time children reached kindergarten.  Those positive outcomes included improvements in families’ economic circumstances, reduced family conflict and violence, better maternal mental and behavioral health, and strengthened parent-child interactions.  Learn more from this HRSA news release, which includes a link to the report.
  • HHS’s Office for Civil Rights has initiated an investigation to probe the alleged use of race-based criteria in the provision of scholarships by a recipient of HHS funding in its programs or activities.  The Office of Civil Rights opened this compliance review based on information it received about an HHS-funded national organization that administers a legal scholarship program that may violate Title VI of the Civil Rights Act of 1964.  Learn more from this HHS news release.
  • HHS’s Office of the Assistant Secretary for Planning and Evaluation (ASPE) has published a report on its longitudinal analysis of medical and long-term services and supports use among Medicare patients as reported in its national health and aging trends study.  Find that report here.
  • ASPE looks at changes in the utilization of personal care services among Medicaid beneficiaries from 2019 to 2020 in a new report  Find it here.
  • In a new report, ASPE examines the impact of certified community behavioral health clinics on children, youth, and their families.  Find that report here.
HHS Office of the Inspector General  
  • The Patient Safety Organization (PSO) program administered by HHS’s Agency for Healthcare Research and Quality (AHRQ) has fallen short in facilitating patient safety learning and improvement on a national scale.  According to HHS’s Office of the Inspector General (OIG), while PSOs have helped some hospitals and health systems improve, they still face challenges that hold the program back from achieving its objectives.  Learn more about what the OIG found in its audit and the steps it recommends for addressing those shortcomings from the report “The Patient Safety Organization Program:  Key Barriers Impeding Nationwide Progress Toward Reducing Patient Harm in Hospitals.”
  • The OIG has issued a favorable opinion about an arrangement in which a company operationalized and makes financial contributions to a foundation and the foundation provides grants to families of children receiving a particular type of therapy.  Find that advisory opinion here.
  • Nursing homes failed to report 43 percent of falls with major injury and hospitalization among their Medicare-enrolled residents, the OIG reports after a recent audit.  Learn more about the OIG’s findings and recommendations from this report.
  • HHS’s OIG has updated its audit work plan.  Find the update here.
Medicaid State Plan Amendments

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

  • To Wyoming, updating inpatient hospital reimbursement to remove provider categories receiving DRG base rates and specific categories for which policy adjustors are applied.
  • To Massachusetts, updating the methods and standards used by the state for payment for restorative services.
  • To Massachusetts, increasing rates for psychologists.
  • To Massachusetts, adding licensed mental health counselor and licensed marriage and family therapist to the other practitioners’ service provider types.
  • To Texas, updating the Medicaid family planning services fee schedule with a proposed effective date of April 1, 2025.
  • To Texas, updating the physicians and other practitioners program fee schedules.
  • To Kansas, updating physician services and reimbursement rates.
  • To North Carolina, updating the 1915 authority.
  • To Utah, removing provisions for the national initiative to educate parents on the dangers of shaken baby syndrome because funding for this initiative was cut during the 2025 general session of the Utah legislature.
  • To Utah, removing provisions for transitional outpatient payments because funding for these payments to providers was cut during the 2025 general session of the Utah legislature.
  • To Oregon, removing the September 30, 2025 end date for the medication-assisted treatment option for opioid use disorder.
  • To New Jersey, adding mandatory coverage for eligible juveniles who are inmates of a public institution post-adjudication of charges and adding targeted case management services for eligible juveniles.
  • To Maryland, updating plan of care requirements in the state’s targeted case management benefit for children and youth with serious mental illness.
  • To Georgia, updating the state Medicaid plan to reflect federal requirements for third-party liability.
  • To Michigan, providing for mandatory coverage for eligible juveniles who are incarcerated in a public institution post-adjudication of charges.
  • To North Dakota, increasing the personal needs allowance.
  • To Arizona, adjusting the inpatient hospital APR-DRG newborn policy adjustor to account for increases in the newborn screening fee.
HHS Newsletters, Reports, and Videos
  • CMS – MLN Connects – September 18
  • AHRQ News Now – September 16
  • HRSA – HRSA posted a video of the webinar it held last week to explain the process for applying for National Health Service Corps’ service loan repayment program for students.  Find the video and a transcript of the webinar here.
  • CMS Center for Clinical Standards & Quality – August Townhall webinar (with transcript)
  • Assistant Secretary for Technology Policy (ASTP) – “TEFCA:  Accelerating Government Benefits Determination for a Better Tomorrow” – blog post, September 16
  • CDC – Morbidity and Mortality Weekly Report – “Influenza-Associated Hospitalizations During a High Severity Season – Influenza Hospitalization Surveillance Network, United States, 2024–25 Influenza Season” – September 11
Food and Drug Administration (FDA)

The FDA has launched an interactive tool designed to facilitate the public’s ability to query real-time adverse event data on cosmetic products.  The platform enables users to download report listings or data sets, with reports being updated daily to include the most recent submissions.  Learn more from this FDA news release and this FAQ.  Find the new public dashboard here.

National Institutes of Health (NIH)

The NIH has launched an effort to reduce the rate of preventable stillbirths in the U.S.  Investigators will develop tools, devices, and other technologies that have the potential to affect diagnosis and prevention efforts relevant to stillbirth, which occurs in one in 160 deliveries in the U.S.  Learn more from this NIH news release.

Medicare Payment Advisory Commission (MedPAC)
  • MedPAC has submitted formal comments to CMS in response to CMS’s proposed rule on the payment systems for hospital outpatient departments and ambulatory surgical centers for CY 2026.  Among its recommendations, MedPAC:
    • Reiterates its call for the redirection of Medicare disproportionate share (Medicare DSH) money to qualified hospitals under MedPAC’s own Medicare Safety-Net Index and the addition of $4 billion to that pool of money.
    • Recommends changes in the construction of CMS’s wage index system.
    • Calls for caution in the phase-out of the Medicare inpatient-only list for surgical procedures and additions to the ambulatory surgical center covered procedures list.
    • Expresses support for expanded use of site-neutral payments for drug administration services that are delivered in excepted off-campus provider-based departments.

Learn more about these and other MedPAC recommendations in response to CMS’s proposed outpatient prospective payment system from this MedPAC comment letter to CMS.

  • MedPAC has submitted formal comments to CMS in response to CMS’s proposed physician fee schedule rule for CY 2026.  Among its recommendations, MedPAC calls for physician payments that better target clinicians who treat low-income patients.  Learn more about why, and about MedPAC’s recommendations on how to update practice expense adjustments more effectively, payments for urgent care center services, efficiency adjustments, the use of outpatient prospective payment system data for rate-setting, and more from this MedPAC comment letter to CMS.
Congressional Budget Office (CBO)
  • A CBO analysis of the estimated effects on federal deficits and health insurance coverage that would occur if the following changes to current law were enacted on September 30, 2025 has concluded that:
    • Permanently expanding the premium tax credit structure as provided in the American Rescue Plan Act of 2021 and later extended through calendar year 2025 in the 2022 reconciliation act, would increase the deficit by $350 billion from 2026 to 2035 and the number of people with health insurance by 3.8 million in 2035.
    • Nullifying a final rule published in June 2025 by HHS related to the health insurance marketplaces established by the Affordable Care Act would increase the federal deficit by $40 billion from 2026 to 2035 and the number of people with health insurance by 300,000 in 2035.
    • Repealing sections of the 2025 reconciliation act related to the health insurance marketplaces would increase the deficit by $272 billion from 2026 to 2035 and the number of people with health insurance by 2.9 million in 2035.

Learn more from the CBO report “The Estimated Effects of Enacting Selected Health Coverage Policies on the Federal Budget and on the Number of People With Health Insurance.”

  • The CBO has prepared a presentation describing the basis for its estimate of how the Medicaid state directed payments provisions in the 2025 reconciliation act, which lowered the upper limit for state directed payments, will affect federal direct spending for Medicaid.  That estimate found that these payments totaled $102 billion in fiscal year 2024, accounting for 21 percent of Medicaid managed care spending.  Find the CBO presentation here.
  • The CBO has prepared a presentation that reviews how it estimated the budgetary effects of three provisions in the 2022 reconciliation act related to prescription drugs:  drug price negotiation in Medicare, the Medicare inflation rebate, and the redesign of the Medicare Part D benefit.  CBO describes how recent developments affect the agency’s assessment of the effects of each of those provisions and poses unanswered questions for which the agency will seek insights from its own panel of health advisors.  CBO also comments on its continuing efforts to understand the effects of these provisions on the development of new drugs.  Learn more from this CBO presentation.
Government Accountability Office (GAO)
  • Under federal Medicaid law, states may test new approaches for delivering health care services through Medicaid demonstrations programs that may include otherwise ineligible spending.  Policy requires demonstrations to be budget neutral for the federal government and not to raise its costs.  In 2022, policy changes permitted states to include the costs for some services for which Medicaid does not typically pay and this increased demonstration spending by billions of dollars.  The GAO has examined this issue and in a new report documents what it found and offers recommendations for addressing the problems it identified.  Learn more from the GAO report “Medicaid Demonstrations: Action Needed to Address New Cost Concerns.”
  • With the FY 2026 budget reconciliation bill introducing mandatory work requirements for many Medicaid participants, the GAO has published a report presenting information on administrative spending associated with the state of Georgia’s implementation of its own Medicaid work requirements.  Learn more about what the GAO learned and what improvements it recommends from this GAO report.
American Medical Association (AMA)

The AMA has released its 2026 current procedure terminology (CPT) code set, which includes 288 new codes.  Additions include new codes for digital health services; codes that reflect the continued emergence of technology that enables providers to collect and analyze patients’ health care data; new codes for AI services; new codes that reflect innovative approaches to providing hearing device services; an update and modernization of codes involving lower extremity revascularization; and updates to several code appendixes, including for behavioral health services.  Learn more from this AMA news release.

Stakeholder Events

CMS – Rural Health Transformation Program Applicants Webinar – September 19 and 25

CMS will hold webinars for applicants for Rural Health Transformation Program grants on Friday, September 19 at 3:00 (eastern) and on Thursday, September 25 at 3:00 (eastern).  Go here to participate in the September 19 webinar and go here to register to participate in the September 25 webinar.

HHS Office of Minority Health – September 25

HHS’s Office of Minority Health is holding a two-part webinar on sickle cell disease.  Part 1, on clinical trials and transformative therapies, was held last Thursday.  Part 2, on innovations and advances in sickle cell disease gene therapies, will be held on Thursday, September 25 at 2:00 (eastern).  Learn how to register to participate in the September 25 event from this Office of Minority Health notice.

Agency for Healthcare Research and Quality – Prepping for the Future: Digital Solutions for Aging Populations Webinar – October 8

HHS’s Agency for Healthcare Research and Quality (AHRQ) will hold a webinar on digital solutions for aging populations on Wednesday, October 8 at 2:30 (eastern).  Presenters will discuss how tools such as remote monitoring, telehealth, and personalized health apps are transforming care for older adults by enabling timely interventions, improving access, and supporting independence and can help improve health outcomes, overcome adoption barriers, and ensure older adults benefit from accessible, user-friendly, and effective digital solutions.  Go here to register to participate and for additional information about the webinar and continuing education credits for a variety of health care professionals.

MedPAC – Commissioners Meeting – October 9-10

MedPAC’s commissioners will hold their next public meeting virtually on Thursday, October 9 and Friday, October 10.  An agenda and registration information are not yet available but when they are they will be posted here.