Weekly Health Care Policy Update – May 9, 2025

May 16, 2025

In this update: 

  • Administration Updates
    • President Trump Submits Budget Request
    • President Trump Swaps Nominees for Surgeon General
  • Legislative Update
    • Lawmakers Call on RFK Jr. to Restore Public Comment
  • Federal Agencies
    • Trump Administration Sides with Biden in Abortion Pill Case
    • CFPB Asks Courts to Vacate Rule Barring Medical Debt from Credit Scores
    • DOJ Sues Three Medicare Advantage Insurers
    • NIH Issues Guidance Banning Subawards to Foreign Institutions
    • Vinay Prasad to Lead FDA Center for Biologics Evaluation and Research
    • CCIIO Issues Bulletins on 2026 Rate Filing and Plan Offering
  • Other Updates
    • Twenty State AGs Sue HHS Over Restructuring
    • NBER Paper Shows Medicaid Expansion Increased Enrollment and Reduced Mortality
  • New York State Update
    • DOH Updates the Medical Orders for Life-Sustaining Treatment (MOLST) Form

Administration Updates

President Trump Submits Budget Request
On May 2nd, President Trump submitted his discretionary budget recommendations to Congress for fiscal year (FY) 2026. Presidential budget recommendations largely serve as messaging documents, providing a sense of an administration’s priorities. Congressional appropriators have no obligation to abide by any President’s budget requests.
 
This budget requests $93.8 billion for the Department of Health and Human Services (HHS), a significant drop from the Department’s FY 2025 funding of $127 billion. The budget also outlines the President’s plan to restructure the department, eliminating some agencies and programs entirely, and cutting funding for others. Of note, the President recommends a $674 million reduction in funding for Centers for Medicare & Medicaid (CMS) Program Management, a 17% reduction from FY 2025. CMS uses these funds for a variety of purposes across the agency.
 
Submission of the President’s budget marks the beginning of the FY 2026 appropriations process which will include committee hearings, markups, and floor consideration of appropriations bills, should Congress succeed in moving funding bills through the regular order.
 
The budget request is available here.
 
President Trump Swaps Nominees for Surgeon General 
On May 7th, President Trump announced a new nominee for U.S. Surgeon General, Dr. Casey Means. A graduate of Stanford Medical School, Dr. Means left surgery without finishing her training and is now a best-selling author and wellness influencer. Her work centers on metabolic health and nutrition. Her brother, Calley Means, is a prominent advisor to Secretary Kennedy. Together, Dr. Means and her brother have been outspoken critics of the pharmaceutical and food industries, some vaccines, and alleged corruption at the Food & Drug Administration (FDA). President Trump’s first nominee, Dr. Janette Nesheiwat, withdrew her nomination following scrutiny surrounding her medical credentials.

Legislative Update

Lawmakers Call on RFK Jr. to Restore Public Comment 
On May 1st, Democratic Senators and Representatives introduced twin resolutions calling on the Trump Administration to restore public comment on matters pertaining to the Department of Health and Human Services (HHS) business. On February 28th, HHS submitted a policy statement to the Federal Register that would rescind the Richardson Waiver, which required HHS to use notice and comment rulemaking rules and regulations for matters relating to public property, loans, grants, benefits, or contracts.
 
While the resolution lacks statutory standing to reverse HHS’ decision to rescind the waiver, it adds public pressure on the Administration. The Association of American Medical Colleges (AAMC), National Rural Health Association (NRHA), Children’s Hospital Association (CHA), American Academy of Family Physicians (AAFP), American College of Obstetricians and Gynecologists (ACOG), and American Academy of Pediatrics (AAP), among others, joined in support of the resolution.
 
The resolution is available here, and the list of supporting organizations is available here.

Federal Agencies

Trump Administration Sides with Biden in Abortion Pill Case
On May 5th, the Department of Justice (DOJ) filed to dismiss a lawsuit regarding regulatory changes and access to mifepristone. In its motion to dismiss the case, the DOJ echoed concerns from the Biden Administration, arguing that the case does not meet the legal standard to be heard in the Northern District of Texas, given that the plaintiffs (three attorneys general) represent Missouri, Idaho, and Kansas. In this largely technical move, experts surmise that the Trump Administration is buying time before adopting a legal and regulatory strategy around medication abortion for his second term. To date, Food and Drug Administration (FDA) Commissioner Dr. Marty Makary has not released plans to roll back regulatory flexibilities for or the approval of mifepristone.
 
The filing is available here.
 
CFPB Asks Courts to Vacate Rule Barring Medical Debt from Credit Scores
On April 30th, Consumer Financial Protection Bureau (CFPB) joined two trade groups in requesting that a judge in the Eastern District of Texas vacate a Biden-era medical debt rule. The rule, issued by the CFPB on January 7th, would ban medical debt from credit reports and bar lenders from considering medical debt history in lending decisions. The rule was expected to improve the credit scores of approximately 15 million Americans by an average of 20 points.
On the day the rule was finalized, the two trade groups (Cornerstone Credit Union League and the Consumer Data Industry Association) sued to block the rule’s implementation. Now, rather than defending the rule, the CFPB, which has been battered by reduction in force efforts, is siding with the plaintiffs and arguing that it exceeds the Bureau’s authority.
 
DOJ Sues Three Medicare Advantage Insurers 
On May 1st, the Department of Justice (DOJ) announced a suit against three of the largest Medicare Advantage (MA) insurers (Aetna, Anthem, and Humana) and three insurance brokerages (eHealth, GoHealth, and SelectQuote) over an alleged scheme to steer older adults into MA plans. Initiated in 2021 after claims from an eHealth whistleblower, the lawsuit claims that the MA plans paid “hundreds of millions of dollars” in kickbacks to the brokerages in exchange for directing eligible beneficiaries between 2016 and 2021. Additionally, the suit claims that Aetna and Humana also pressured brokers to not enroll beneficiaries with disabilities, citing cost. This amounts to a violation of both Medicare and federal disability protections. Lastly, the brokerages allegedly blocked out competing insurers if they did not pay enough.
 
Representatives from the insurers and brokerages have denied these allegations. This lawsuit joins existing efforts by Congress to increase oversight over brokerage practices. Finance Committee Ranking Member Senator Ron Wyden has released several reports documenting deceptive marketing and financial incentives.
 
The announcement is available here.
 
NIH Issues Guidance Banning Subawards to Foreign Institutions
On May 1st, the National Institutes of Health (NIH) announced that it would no longer allow subawards to foreign institutions, a change that will cause immediate disruptions to ongoing research projects. Given that many NIH grants fund research with international components, recipients commonly distribute subawards to another institution or organization to carry out a specific part of the project. Rather than allowing subawards, the NIH plans to roll out a new grant structure for “linked awards,” which the NIH will have more oversight into. Until this new policy takes effect, no later than September 30th, the NIH will not issue any new or continuing awards if it includes a subaward to a foreign entity. The Trump Administration cites national security and transparency concerns.
 
The new guidance is available here.
 
Vinay Prasad to Lead FDA Center for Biologics Evaluation and Research
On May 6th, FDA Commissioner Marty Makary announced that Dr. Vinay Prasad will lead the Center for Biologics Evaluation and Research (CBER). A hematologist-oncologist by training, Dr. Prasad most recently served as a professor at the University of California, San Francisco. Like other members of the Department of Health and Human Services (HHS) leadership, Dr. Prasad has been a vocal critic of the government’s response to Covid-19 and policies surrounding vaccination. This announcement comes about a month after former CBER head, Dr. Peter Marks, resigned. Biotech stocks fell following the announcement.
 
The announcement is available here.
 
CCIIO Issues Bulletins on 2026 Rate Filing and Plan Offering
On May 2nd, Peter Nelson, Deputy Administrator and Director of the Center for Consumer Information and Insurance Oversight (CCIIO) at the Centers for Medicare and Medicaid Services (CMS), issued two bulletins regarding plan year (PY) 2026 plan offerings and rate filing. Regarding plan offerings, CMS encourages states to consider requiring issuers that load qualified health plan (QHP) premiums to compensate for the lack of cost-sharing reduction (CSR) reimbursement to offer and market unloaded plans that are exclusively available outside the Exchange. The bulletin notes that the current guidance is intended “to prepare for the possibility of the continued absence” of appropriated CSR payments to issuers.
 
Regarding rate filing, the bulletin notes that potential Congressional action could affect PY 2026 individual market rates. These potential actions include appropriating CSR funding, extending enhanced premium tax credits, doing neither, or doing both. The bulletin directs all issuers that are permitted to load premiums to specify the actual CSRs the issuer paid for enrollees for PY 2024 in the Actuarial Memorandum submitted with the PY 206 rate filing. Issuers must also specify the load amount, how it was determined, and explain how revenue collected from the load amount compares to the CSR amount it expects to provide to enrollees in PY 2026.
 
CMS notes the rate filing submission and final determination deadlines remain unchanged. Issuers must submit rate filing justifications to CMS and the state by the state deadline (no later than July 16th) and states using state-based Exchanges must work with CMS to finalize rate filings by October 15th.
 
The bulletin related to plan offerings is available here, and the bulletin related to rate filing is available here.

Other Updates

Twenty State AGs Sue HHS Over Restructuring
On May 5th, 20 state attorneys general filed a suit against the Trump Administration over the ongoing restructuring of the Department of Health and Human Services (HHS). The plaintiffs allege that the Administration’s actions bypass Congress, are “arbitrary and capricious,” and violate the Administrative Procedure Act, Appropriations Clause, and the separation of powers. The suit seeks injunctive relief and a reinstatement of programming cut in the restructuring, asking the U.S. District Court for the District of Rhode Island to block undue firings and reverse the reorganization.

The complaint is available here.

NBER Paper Shows Medicaid Expansion Increased Enrollment and Reduced Mortality 
On May 2nd, the National Bureau of Economic Research (NBER) released a working paper titled “Saved by Medicaid: New Evidence on Health Insurance and Mortality from the Universe of Low-Income Adults.” The authors found that Medicaid expansions: 

  • increased enrollment by 12 percentage points;
  • reduced the mortality of the low-income adult population by 2.5 percent, suggesting a 21 percent reduction in the mortality hazard of new enrollees; and
  • are cost effective, with direct budgetary costs of $5.4 million per life saved and $179,000 per life-year saved.

On the whole, the researchers estimate that lack of health insurance explains between five and 20 percent of the mortality disparity between high- and low-income Americans.

The paper is available here.

New York State Update

DOH Updates the Medical Orders for Life-Sustaining Treatment (MOLST) Form
On May 2nd, the New York State (NYS) Department of Health (DOH) announced the revision of the Medical Orders for Life-Sustaining Treatment (MOLST) Form. The MOLST form (and the electronic “eMOLST” form) records a patient’s preferences for life-sustaining treatments, such as CPR, ventilation, and other interventions. MOLST is intended for patients with serious health conditions who: 

  • Want to avoid or receive any or all life-sustaining treatment;
  • Reside in a long-term care facility or require long-term care services; and/or
  • Might die within the next year.

The MOLST form is one method for documenting a treatment preferences concerning life-sustaining treatment – providers may choose to use other forms. However, under State law, MOLST is the only authorized form for documenting both a nonhospital do not resuscitate (DNR) and a nonhospital do not intubate (DNI) order. In addition, the form is beneficial to patients and providers as it provides specific medical orders and is recognized and used in a variety of health care settings. Previous versions of the MOLST paper and electronic forms are still valid if patients present with an older version of the medical order.

The DOH press release is available here. Additional information regarding the MOLST, including the form, supporting checklists for specific populations (e.g., people with intellectual/developmental disabilities, people without health care proxies), FAQs, and instructions are available here.