In this update:
- Administration Update
- SCOTUS Allows Trump Administration to Continue Mass Layoffs
- Federal Agencies
- HHS Bans Unauthorized Aliens from Accessing Additional Programs
- DOJ and HHS Form New False Claims Working Group
- Internal HHS Memo Shows Grant Termination Strategy
- Medical Groups Sue Secretary Kennedy Over Vaccine Changes
- FDA Publishes Over 200 Complete Response Letters
- Secretary Kennedy Cancels USPSTF Meeting
- Legislative Update
- CDC Nominee Susan Monarez Clears Senate HELP Committee
- New York State Updates
- DOH Issues Guidance for Medicaid Managed Care Plans on Extension of CDPAP Statewide FI Registration Deadline
- DOH Finalizes September 2025 “Minimum Needs” Thresholds for PCS, CDPAS, and MLTC Eligibility
- DOH Adopts Final Regulations on General Hospital Medical Staff Recertification Timeframes
Administration Update
SCOTUS Allows Trump Administration to Continue Mass Layoffs
On July 8th, the Supreme Court issued an order allowing the Trump Administration to move forward with its ongoing agency restructuring and layoffs. A February executive order directed agencies to initiate sweeping “reductions in force” (RIF), but was blocked by a district judge in California with the argument that the order likely violated federal law. Twenty-one agencies, including the Department of Health and Human Services (HHS), were included in this injunction. In this most recent action, SCOTUS moved to lift the injunction and grant the Administration an emergency appeal to enforce the executive order, with one dissenting opinion from justice Jackson. This decision is pending in the Ninth Circuit Court of Appeals. Critically, the Court did not rule on the merits of the executive order, and litigation over the RIF efforts will continue elsewhere. HHS is facing a separate lawsuit in which a district judge temporarily blocked the reorganization efforts.
Federal Agencies
HHS Bans Unauthorized Aliens from Accessing Additional Programs
On July 10th, the Department of Health and Human Services (HHS) announced the formal rescission of a 1998 notice of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) that extended certain federal public benefits regardless of citizenship status. HHS is interpreting the Clinton-era notice as unlawfully allowing exceptions to the law. While immigrants without an approved lawful status are already prevented from accessing most federal benefits, this rescission extends to Head Start, community health centers, community behavioral health clinics, the Title X family planning program, substance use abuse programs and grants, workforce and homelessness services, and others by classifying them as “federal public benefits.” HHS expects that reclassifying Head Start will save $374 million annually. These changes are effective immediately, though HHS is accepting public comment for 30 days.
The announcement states that “the Department is not formally revising the aspects of the 1998 Notice that touch on PROWRA’s verification requirements at this time,” which has generated uncertainty in the provider community about how to comply with the eligibility changes.
The announcement is available here.
DOJ and HHS Form New False Claims Working Group
On July 2nd, the Departments of Justice (DOJ) and Health and Human Services (HHS) announced the formation of a False Claims Act Working Group to combat health care fraud. The Working Group will include senior leadership from HHS legal offices, the Centers for Medicare & Medicaid Services, and the DOJ’s Civil Division. HHS will make referrals to the DOJ across a handful of priority areas, including Medicare Advantage; drug and device rebates, formulary placement, and kickbacks; violations of network adequacy requirements; defective devices; and manipulation of electronic health records (EHR). The Working Group is encouraging whistleblowers to come forward via the HHS hotline.
The announcement is available here.
Internal HHS Memo Shows Grant Termination Strategy
On July 6th, STAT reported on an internal memo from the Office of the General Counsel at the Department of Health and Human Services (HHS) detailing a new legal strategy for terminating grants considered out of line with Trump Administration priorities, in light of recent court losses. The guidance, dated June 25th, directs staff to work with the Office of the General Counsel to ensure that future terminations do not violate court orders, federal statutes, or the Constitution. It stratifies the options for terminating awards from “most to least legal risk” of being successfully challenged and overturned, including (from most to least risk): “non-alignment with agency priorities,” “for cause,” “non-alignment with agency priorities” at the beginning of the next fiscal year, non-compliance, and termination with grantee consent. The guidance also recommends a more thorough “administrative record” documenting rationale and deliberations over terminations.
The original story is available here.
Medical Groups Sue Secretary Kennedy Over Vaccine Changes
On July 7th, six leading medical groups filed a lawsuit against Secretary Kennedy and the Department of Health and Human Services (HHS) writ large over the decision to no longer recommend Covid-19 vaccines for healthy children and pregnant women. The plaintiffs – the American Public Health Association, the American Academy of Pediatrics, the Infectious Diseases Society of America, the American College of Physicians, the Society for Maternal-Fetal Medicine, the Massachusetts Public Health Alliance, and a pregnant woman – argue that this unilateral change, without input from the Centers for Disease Control and Prevention (CDC), was “designed to mislead, confuse, and gradually desensitize the public to anti-vaccine and anti-science rhetoric.” The suit asks the court to order Secretary Kennedy to reinstate the Covid-19 immunization schedules.
FDA Publishes Over 200 Complete Response Letters
On July 10th, the Food and Drug Administration (FDA) published more than 200 decision letters, also known as complete response letters (CRLs), in a step towards increasing transparency. The CRLs published were in response to drug or biologics applications between 2020 and 2024. The move offers a clearer look at both the FDA’s rationale for rejecting applications and the drug or device deficiencies that prevented approval. Moreover, the FDA hopes that sharing potential lessons learned from non-approvals will lead to fewer companies making similar mistakes. The FDA is working to publish more archival CRLs in the future.
The announcement is available here, and the letters are available here.
Secretary Kennedy Cancels USPSTF Meeting
On July 7th, Secretary Kennedy’s office announced that the U.S. Preventive Services Task Force (USPSTF) meeting scheduled for July 10th would be postponed, without citing a reason. The Task Force was set to host one of its three annual in-person meetings to discuss approaches to preventing cardiovascular disease, including diet and physical activity. The move prompted concern that the Task Force could face a sweeping reorganization, as occurred with the Centers for Disease Control and Prevention’s (CDC) Advisory Committee on Immunization Practices (ACIP) last month. On July 9th, over 100 health organizations penned a letter to Congressional health leadership outlining the need to maintain key Task Force safeguards against political overreach. The recent Kennedy v. Braidwood case affirmed the constitutionality of USPSTF and the Secretary’s authority to appoint and remove members at will.
Legislative Update
CDC Nominee Susan Monarez Clears Senate HELP Committee
On July 9th, the Senate Health, Education, Labor and Pensions (HELP) Committee voted to advance the nomination of Susan Monarez to lead the Centers for Disease Control and Prevention (CDC). Monarez was named acting director in January, and has held various federal health technology and biosecurity roles over two decades. The party line, 12-11 vote comes as the agency has faced steep reductions in force with no leader at the helm. Monarez reaffirmed her commitment to vaccines and other public health interventions, while avoiding direct questions about Secretary Kennedy’s leadership. A full Senate vote has yet to be scheduled.
New York State Updates
DOH Issues Guidance for Medicaid Managed Care Plans on Extension of CDPAP Statewide FI Registration Deadline
On July 3rd, the New York State (NYS) Department of Health (DOH) issued guidance to Medicaid Managed Care Plans (MMCPs) regarding the recently amended preliminary injunction for the Consumer Directed Personal Assistance Program (CDPAP). The amended preliminary injunction extends the deadline under which consumers receiving CDPAP need to complete their registration with the Statewide Fiscal Intermediary (FI), Public Partnerships LLC (PPL). Consumers who are not in receipt of CDPAP or not in the process of registering with PPL by August 1st may be issued a Discontinuation of Services Notice.
The guidance outlines additional outreach and education efforts required of MMCPs for consumers currently utilizing a prior FI, consumers with unused CDPAP services, and consumers fully registered with PPL. DOH will provide templates for these communications.
The guidance is available here. Questions may be submitted to StatewideFI@health.ny.gov.
DOH Finalizes September 2025 “Minimum Needs” Thresholds for PCS, CDPAS, and MLTC Eligibility
On June 30th, DOH issued guidance regarding new eligibility requirements for Personal Care Services (PCS), Consumer Directed Personal Assistance Services (CDPAS), and Managed Long Term Care (MLTC) plans. These changes were recommended by the second Medicaid Redesign Team (MRT) and adopted in the State Fiscal Year 2020-21 Enacted Budget. The modified eligibility requirements are expected to save the State approximately $300 million annually.
Starting on or after September 1st, Medicaid Managed Care members (including HIV SNP and HARP members) who are seeking PCS or CDPAS or who would like to transfer to an MLTC plan must meet Minimum Needs Requirements. Individuals currently enrolled in an MLTC plan or authorized for PCS or CDPAS prior to September 1st will be granted Legacy Status and will not be subject to the new requirements at reassessment.
The Minimum Needs Requirements will authorize PCS/CDPAS for individuals who:
- Need at least limited assistance with physical maneuvering with more than two Activities of Daily Living (ADLs); or
- Have a diagnosis of dementia or Alzheimer’s disease and need at least supervision with more than one ADL.
Individuals enrolling into an MLTC or Medicaid Advantage Plus (MAP) plan must meet the Minimum Needs Requirements at initial and subsequent assessments, in addition to the need for Community-Based Long Term Services and Supports (CBLTSS) for more than 120 days. The new requirements do not apply to enrollment in Programs of All-Inclusive Care for the Elderly (PACE) plans; however, PACE enrollees will be granted Legacy Status as applicable, allowing individuals to transfer within MLTC lines of business. In order to retain Legacy Status, the member must be continuously enrolled in the MLTC program, including PACE.
The guidance for MMC plans is available here. The MLTC policy update is available here.
DOH Adopts Final Regulations on General Hospital Medical Staff Recertification Timeframes
On July 9th, DOH adopted final regulations to change the Article 28 general hospital medical staff recredentialing timeframe from every two years to every three years. No changes were made to the final regulations compared to the proposed regulations.
The final regulations are available here.