Congress
House Republicans continue to debate what should be included in the reconciliation bill, with no consensus emerging, yet. The leading contender for savings within the health policy realm would be to target large cuts to Medicaid expansion savings either via a per capita cap or reductions in FMAP rate for this population. There is ongoing debate as such a policy would likely result in large increases in uninsured numbers and strain on hospital finances.
Supreme Court
The Supreme Court ruled against a hospital led lawsuit alleging that CMS’s formula around disproportionate share hospital payments underpaid hospitals. While SCOTUS ruled against this particular case it did leave the door open for future lawsuits on this issue. Modern Healthcare has a good summary of the issue and previews future cases on the issue.
HHS Watch
HHS put forth new requirements on vaccine testing. HHS will require placebo testing on new vaccines. The requirements are expected to limit vaccine production, increase cost, and reduce access.
Economy
The US economy shrank 0.3% on an annualized basis in the first quarter of 2025. The negative growth was driven by a surge in imports. This was a surprise as most economists predicted slight growth in the first quarter. These GDP figures do not capture the effects of tariffs that were imposed in April, leading many economists to increase their odds that the US will enter a recession in the next quarter.
