Reconciliation Bill
Discussions continued this week between the Senate and House on their major reconciliation bill. The two sides continue to differ on approach, which is delaying a unified agreement. Politico reported that the two sides will attempt to bridge the divide before the upcoming Easter recess. All signs point to a bill not passing before late summer/fall.
One of the major sticking points between the House and the Senate is on the size of Medicaid funding cuts. A number of different pieces have been published in recent days to influence the debate.
- One change being debated in the reconciliation bill is a cap on provider taxes to finance state Medicaid financing. KFF released a helpful overview of Medicaid and provider taxes and the potential implications to capping them.
- State Directed Medicaid Payments – Axios reported that the Paragon Institute, a highly influential think-tank connected to the Trump Administration, released a piece calling cuts to state-directed Medicaid Payments.
HHS/CMS
- A Senate panel approved of Mehmut Oz’s nomination for CMS Administrator. The full Senate is expected to approve of Oz’s nomination next week.
- HHS announced that there would be mass layoffs. Overall HHs expects to layoff an additional 10,000 employees to the approximately 10,000 who have opted to leave since the start of the Trump Administration. The majority of the cuts would be focused on the FDA/CDC/NIH although CMS would also experience cuts.
Tariffs
President Trump announced that he intended to put tariffs on imported drugs, biotech, and device industry goods in April. This potentially would affect about $303 billion dollars’ worth of goods. These tariffs could result in significant increases in costs that ultimately could flow to insurers and consumers.
AVC
CMS released an updated version of the Actuarial Value Calculator for 2026. The changes tie to the proposed changes in the Program Integrity Rule such as expanded de minimis ranges and a higher maximum out of pocket.
