Weekly Health Care Policy Update – March 14, 2025

March 21, 2025

In this update: 

  • Administration Updates
    • Updates on Trump Health Care Nominees
    • Court Rejects Move to Block DOGE Access to Medicare Payment Information
    • HHS Employees Offered $25,000 Buyout
  • Legislative Update
    • Congress Expected to Avert Government Shutdown
  • Federal Agencies
    • CMMI Completes Review of Active Models
    • CMS Issues Proposed Rule on ACA Integrity and Affordability
    • CMS Issues Update on Interoperability and Prior Authorization Rule
    • CDC Will Investigate Alleged Link between Vaccines and Autism
    • CDC Issues Measles Health Advisory
    • NIH to Cancel Grants on Vaccine Hesitancy or Refusal
    • NIH Announces Centralization of Peer Review 
    • HHS OCR Investigates Medical Schools and Hospitals for Race- or Sex-Based Programs
  • Other Updates
    • MedPAC Holds March 2025 Meeting
    • Urban Institute Report Shows Potential Impact of Medicaid Cuts on Hospitals

Administration Updates

Updates on Trump Health Care Nominees 
On March 13th, there were several updates on the nominations of President Trump’s health care appointees: 

  • Dr. Dave Weldon, Centers for Disease Control and Prevention (CDC): Just hours before a scheduled confirmation hearing, the White House withdrew its nomination for Dr. Dave Weldon to serve as head of the CDC. According to a statement from Dr. Weldon, the White House had informed him that there were not enough votes to confirm his nomination, citing Senator Susan Collins (R-ME) and Chair Bill Cassidy (R-LA) of the Senate Health, Education, Labor and Pensions (HELP) Committee. It is unclear whether the White House has a backup candidate. His statement is available here.
  • Dr. Marty Makary, Food and Drug Administration (FDA): On March 13th, the Senate Health, Education, Labor and Pensions (HELP) Committee voted 14-9 to advance Dr. Marty Makary’s nomination to serve as Commissioner of the FDA, with bipartisan support from Senators Maggie Hassan (D-NH) and John Hickenlooper (D-CO).
  • Dr. Jay Bhattacharya, National Institutes of Health (NIH): On March 13th, the Senate Health, Education, Labor and Pensions (HELP) Committee voted 12-11 to advance Dr. Marty Makary’s nomination to serve as NIH Director along party lines.

Court Rejects Move to Block DOGE Access to Medicare Payment Information 
On March 7th, U.S. District Judge Colleen Kollar-Kotelly refused to issue a preliminary injunction blocking employees from the Department of Government Efficiency (DOGE) from accessing Treasury Department systems, including Medicare payment information. This decision stems from a lawsuit filed by retirees and union leaders over concerns about sensitive information. Judge Kollar-Kotelly found that while their concerns were “understandable,” the plaintiffs did not demonstrate “likelihood of an irreparable injury that is ‘beyond remediation.’” In Manhattan, however, a federal judge has barred DOGE from accessing Treasury systems, and this ruling will remain in place. ‘’

HHS Employees Offered $25,000 Buyout 
On March 7th, the majority of the Department of Health and Human Services’ (HHS) 80,000 employees were offered a “voluntary separation incentive payment” (VSIP), with a deadline to respond by March 14th. VSIPs allow agencies that are planning to downsize or restructure to offer payouts of up to $25,000. This offer comes amid vague conversations of deep cuts to staff and a push under the Voluntary Early Retirement Authority (VERA) to offer certain high-ranking officials a retirement plan. Certain employees were not offered the VSIP or were deemed ineligible, including Food and Drug Administration drug and device probationary workers, employees who participated in DOGE’s deferred resignation program, as well as reviewers in the Centers for Drug Evaluation and Research, Biologics Evaluation and Research, and Devices and Radiological Health.

Legislative Update

Congress Expected to Avert Government Shutdown 
On March 13th, Senate Minority Leader Chuck Schumer (D-NY) announced that he would support passage of a GOP-crafted Continuing Resolution (CR) passed by the House of Representatives earlier in the week. The CR passed the House on a largely party-line vote of 217-214, and would fund the government through September. The bill cuts funding for non-defense spending by $13 billion while increasing defense spending by $6 billion. It does not include a “doc pay” fix, but does include other key health extenders:

  • Medicaid Disproportionate Share Hospital Relief: eliminates the Medicaid DSH cuts through September 30th: 
  • Medicare Rural Extenders: extends the enhanced low-volume adjustment program through September 30th and extends the Medicare-dependent hospital program through October 1st; 
  • Medicare Telehealth and Hospital-at-home Extensions: extends telehealth waivers and the hospital-at-home program through September 30th;
  • Work Geographic Index Floor: extends a 1.0 floor on the work geographic practice cost index through October 1st; and
  • Medicare Rural Ambulance: extends add-on payments for ambulance services through October 1st.

In a floor speech, Schumer called the CR “very bad” but that the “potential for a shutdown has consequences for America that are much, much worse.” A number of Democrats in the Senate have announced they will not support the bill, including Senators Hickenlooper (D-CO), Kelly (D-AZ), Ossoff (D-GA), Merkley (D-OR), Murray (D-WA), Sanders (I-VT), Slotkin (D-MI), Warner (D-VA), and Warren (D-MA), many of whom are calling for a clean four-week CR instead. Republicans need 60 votes in the Senate to pass the bill ahead of tonight’s government funding deadline. Votes are expected this afternoon and this evening.

Federal Agencies

CMMI Completes Review of Active Models
On March 12th, the Centers for Medicare & Medicaid Innovation Center (CMMI) announced that they had completed a review of their payment models and would cancel or cease six of them. Otherwise, CMMI said that it has determined “its other active models can meet the Center’s statutory mandate—either as is or with future modification—and therefore will continue moving forward.” These other active models presumably include ACO REACH, the States Advancing AHEAD model. It is unclear whether other announced but not implemented models, such as the TEAM model, will qualify.

CMMI announced an early end to four existing models: 

  • Maryland Total Cost of Care
  • Primary Care First
  • ESRD Treatment Choices, and
  • Making Care Primary.

The decision means the programs will end on December 31st. Three of the four models are within two years of termination, with the notable exception of Making Care Primary, which was slated to run through 2034.

Moreover, CMMI will not pursue implementation of two Biden-era models that have yet to begin: the Medicare $2 Drug List and Accelerating Clinical Evidence. The announcement also notes that CMS is weighing model changes for the Integrated Care for Kids awards.

According to the announcement, these cancellations were informed by data-driven reviews of program spending and quality outcomes, and will save $750 million. The Center currently operates 23 models, with $10 billion in mandatory funding each decade. CMMI plans to announce a new strategy in the near future. The announcement is available here.

CMS Issues Proposed Rule on ACA Integrity and Affordability
On March 10th, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule titled “Patient Protection and Affordable Care Act; Marketplace Integrity and Affordability”. The rule is a response to CMS’ belief that several recent regulatory actions designed to make enrolling in subsidized coverage easier have “severely weakened program integrity,” put consumers at risk of improper enrollments, and increased premiums and associated consumer and taxpayer costs. Several actions CMS proposes in the rule reverse prior CMS rulemaking. Major provisions include revision of standards relating to: 

  • Past-due premium payments: CMS proposes to remove the requirement restricting issuers from attributing premium payment for new coverage to past-due premiums from prior coverage. CMS proposes to allow issuers to attribute past-due premium amounts to the initial premium due to effectuate new coverage; this proposal does not limit issuers to past-due premiums accrued only over the prior12 months.
  • Exclusion of Deferred Action for Childhood Arrivals (DACA) recipients from the definition of “lawfully present”: CMS proposes to remove DACA recipients from the definition of “lawfully present,” thus excluding them from eligibility for enrollment in a QHP and eligibility for premium tax credits (PTCs), cost-sharing reductions (CSRs), or to enroll in a Basic Health Plan (BHP).
  • The evidentiary standard HHS uses to assess an agent’s, broker’s, or web-broker’s potential noncompliance: CMS proposes a new standard, the “preponderance of the evidence” standard, referring to evidence which, compared with evidence opposing it, leads to the conclusion that the fact at issue is more likely true than not. CMS proposes to apply this standard in the process of terminating an agent, broker, or web-broker for cause on FFEs and SBE-FPs.
  • Failure to file and reconcile (FTR): CMS proposes to return to a one-year FTR process, rather than the current, two-consecutive year process. An exchange cannot deem an individual eligible for APTCs if the applicant, or their spouse if married, did not file a federal income tax return and reconcile APTC for a year for which tax data would be utilized for verification of household income and size.
  • Income eligibility verifications for premium tax credits and cost-sharing reductions: CMS proposes to remove the requirement that Exchanges accept an applicant’s or enrollee’s self-attestation of projected annual household income when the IRS confirms there is no tax return data available. This requirement is an exception to a requirement to verify household income with other trusted data sources, which will remain effective should CMS finalize this proposal.
  • Annual eligibility redetermination: CMS proposes to prevent enrollees from being automatically re-enrolled in coverage with APTC that fully covers the premium without taking action to confirm their eligibility information. CMS proposes that in such circumstances, the Exchange must reduce the APTC amount such that the enrollee must pay $5 for the first month and every following month until they confirm or update their eligibility determination.
  • Automatic re-enrollment hierarchy: CMS proposes to remove part of the reenrollment hierarchy which allows and Exchange to move CSR-eligible enrollees from a bronze QHP to a silver QHP, if available in the same product with the same provider network and a lower or equivalent net premium, after application of APTC.
  • Premium payment threshold: CMS proposes to eliminate the option for issuers to establish a fixed dollar or gross percentage-based premium payment threshold, which were established in the 2026 payment notice. This leaves in place the net percentage-based premium payment threshold of 95 percent or higher.
  • The annual open enrollment period: CMS proposes to establish, beginning with the 2026 enrollment year, that the open enrollment period begin November 1 and end December 15 for all Exchanges, including State-based Exchanges. CMS seeks comment on whether it should also prohibit Exchanges from extending open enrollment by applying a blanket special enrollment period.
  • Special enrollment periods: CMS proposes to repeal the monthly special enrollment period (SEP) for APTC-eligible individuals with a projected annual household income at or below 150% of the FPL, and to repeal the ability of such individuals and their dependents to move to a silver plan during this SEP. CMS also proposes to require that all Exchanges conduct pre-enrollment verification of eligibility for a SEP for at least 75% of new enrollments.
  • The premium adjustment percentage methodology: CMS proposes to update the premium adjustment percentage methodology to establish a premium growth measure that includes premium changes in the individual market in addition to employer-sponsored insurance (ESI) premiums for 2026 and beyond. If finalized, values for 2026 premium adjustment percentage (1.67) , maximum annual limitation on cost sharing ($10,600 self-only, $21,200 other than self-only), reduced maximum annual limitations on cost sharing (Silver 94% and 87% AV: $3,500 self only, $7,000 other than self-only; Silver 73% AV: $8,450 self-only, $16,900 other than self-only), and required contribution percentage proposed (8.05%) in this rule would supersede those published in October 2024.
  • Sex trait modification: CMS proposes to prohibit issuers of coverage subject to EHB requirements from providing coverage for sex-trait modification as an EHB.

Comments will be due 30 days after the rule is published in the Federal Register, which is scheduled for March 19th. The announcement is available here, the proposed rule is available here, and the fact sheet is available here.

CMS Issues Update on Interoperability and Prior Authorization Rule 
On March 11th, CMS issued an update on the Interoperability and Prior Authorization final rule, originally released in February 2024. Under the rule, beginning January 1, 2026, state Medicaid and Children’s Health Insurance Program (CHIP) fee-for-service (FFS) programs must send prior authorization decisions within one of two established timeframes: expedited or standard. A number of states have raised concerns over effective implementation on this timeline. CMS is offering states the option to identify any extenuating circumstances or unique challenges to implementation by April 1st for review and potential reconciliation.

The update is available here.

CDC Will Investigate Alleged Link between Vaccines and Autism
On March 7th, the Centers for Disease Control and Prevention (CDC) announced its intent to conduct a large-scale study investigating the alleged connection between vaccines and autism. Dozens of studies, both globally and domestically, have failed to produce a link between the two, including a study of 1.2 million children that Chair Bill Cassidy (R-LA) cited during his questioning of HHS Secretary Robert F. Kennedy Jr. during his confirmation hearing. Kennedy has vowed to revisit data tracking vaccines and autism.

CDC Issues Measles Health Advisory 

On March 7th, the Centers for Disease Control and Prevention (CDC) issued a Health Alert Network (HAN) Health Advisory about the ongoing measles outbreak in Texas and New Mexico. As of March 11th, Texas has reported 223 cases, 29 hospitalizations, and one death; New Mexico has reported 33 cases, no hospitalizations, and one death. The advisory affirms that the measles-mumps-rubella (MMR) vaccination “remains the most important tool for preventing measles,” while offering comprehensive recommendations for health care professionals, state and local health departments, and domestic travelers ahead of the spring travel season.

The announcement is available here.

NIH to Cancel Grants on Vaccine Hesitancy or Refusal 
On March 10th, the National Institutes of Health (NIH) began abruptly terminating over 40 research grants for projects studying vaccine hesitancy and refusal and/or strategies to encourage vaccine uptake, effective immediately. Affected researchers were informed that the award “no longer effectuates agency priorities,” with no recourse for award modification. Many of these projects focus on promoting uptake among racial minorities and hesitant parents for mpox, human papillomavirus, chickenpox, and Covid-19 vaccines, among others. On March 6th, according to reports, the NIH has also requested details on projects involving messenger RNA (mRNA), a target of many vaccine skeptics.

NIH Announces Centralization of Peer Review  
On March 6th, the National Institutes of Health (NIH) announced plans to centralize peer review operations for grants, research, and cooperative agreements. Under this plan, the Center for Scientific Review (CSR) will assume the responsibility for all first-round peer review activity before contracts advance to advisory councils at one of the agency’s 27 institutes and centers (ICs) and the Office of the Director. Currently, ICs coordinate first-round (of two) peer reviews for about 22% of grants, particularly for large-scale clinical trials. The NIH claims that this procedural change will save over $65 million. Science estimates that as many as 300 scientific review officer jobs will be eliminated with some staff moving to the CSR. The proposed centralization is still under review by the Department of Health and Human Services and the Office of Management and Budget.

The announcement is available here.

HHS OCR Investigates Medical Schools and Hospitals for Race- or Sex-Based Programs
On March 7th, the HHS Office of Civil Rights (OCR) announced investigations into four unnamed medical schools and hospitals pursuant to Executive Order (EO) 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity. The investigations are in response to allegations that these institutions “may operate medical education, training, or scholarship programs for current or prospective workforce members that discriminate on the basis of race, color, national origin, or sex.” HHS is encouraging individuals who believe they have been discriminated against on the basis of a protected characteristic to file a complaint with OCR, as part of broader efforts to “restore merit-based opportunities in medicine.” Under this EO, each agency is required to identify “nine potential civil compliance investigations” into institutions operating programs focused on racial and gender minorities.

The announcement is available here.

Other Updates

MedPAC Holds March 2025 Meeting
On March 6th and 7th, the Medicare Payment Advisory Commission (MedPAC) held its monthly public meeting. The Commissioners expressed strong support for Congress updating the physician fee schedule with an annual update reflecting the Medicare Economic Index (MEI), while also improving the accuracy of payment rates with up-to-date data. The Commissioners also expressed support for ongoing independent research into home health care utilization among Medicare Advantage (MA) enrollees. Lastly, the Commissioners requested additional analysis of institutional special needs plans (I-SNPs).

The slides are available here.

Urban Institute Report Shows Potential Impact of Medicaid Cuts on Hospitals 
On March 11th, the Urban Institute released a report on the potential impact of Medicaid cuts on hospitals in all 50 states. The analysis forecasts the consequences of all states dropping Medicaid expansion (triggering each state’s general matching rate for the expansion population, rather than the enhanced Federal Medical Assistance Percentage), finding: 

  • Health Care Spending:  Spending on health care services would decrease, overall, by nearly $80 billion;
  • Uncompensated Care: Overall, spending on uncompensated care would increase by $18.9 billion in 2026 alone;
  • Revenue Loss: Hospitals would face a revenue loss of $31.9 billion, the largest loss of any provider, with an increased burden of uncompensated care ($6.3 billion);
  • Other Sectors: Beyond hospitals, $20.9 billion less would be spent on prescription drugs, $20.7 billion less on other health care services, and $6.4 billion less on office-based physician services; and
  • New York: Hospital spending for the nonelderly would drop 7.8% statewide, 9.9% in Manhattan, and 11.2% in the Bronx.

The report is available here.