The Weekly Round-Up of US Health and Insurance Regulation

This Week’s Dose

• Trump administration officials head to Capitol Hill to testify on FY 2027 budget priorities. US Department of Health and Human Services (HHS) Secretary Kennedy testified before three committees this week, with four more hearings on deck for next week.
• House Committee on Oversight and Government Reform discusses fraud in federally funded programs run by states. Members discussed efforts to improve program oversight, integrity, and accountability.
• House Energy and Commerce Health Subcommittee reviews public health legislation. Members from both parties expressed strong support for the reauthorization of multiple public health bills focused on tick-borne illnesses, breast cancer detection and education, ALS research and access to therapies, stem cell transplantation, and expansion of school-based health centers.
• Senate HELP Committee examines factors contributing to drug pricing.  Democratic and Republican members discussed the need to address anti-competitive practices in the pharmaceutical industry.
• House Ways and Means Health Subcommittee holds field hearing on healthcare modernization. Members discussed how modernizing healthcare delivery and incentivizing innovation could help prevent chronic disease and improve patient outcomes.
• CMS releases FY 2027 IPPS proposed rule. The fiscal year (FY) 2027 Inpatient Prospective Payment System (IPPS) proposed rule released by the Centers for Medicare & Medicaid Services (CMS) updates Medicare payment policies and quality reporting programs relevant for inpatient hospital services and proposes to nationalize a model relating to joint replacement.
• CMS, ONC issue Interoperability Standards and Prior Authorization for Drugs proposed rule. The Office of the National Coordinator for Health Information Technology (ONC) and CMS proposed rule outlines electronic prior authorization (ePA) requirements for payers for drugs and includes five requests for information (RFIs).
• CMMI extends ACCESS application deadline, announces accepted applicants. The CMS Innovation Center’s (CMMI) Advancing Chronic Care with Effective, Scalable Solutions (ACCESS) Model has accepted more than 150 organizations and extended its application deadline to May 15, 2026, to allow additional participants to apply ahead of the July 5, 2026, launch.

Congress

Trump administration officials head to Capitol Hill to testify on FY 2027 budget priorities. 

Following the Trump administration’s recent release of its FY 2027 budget request, cabinet secretaries and other administration officials began to make the rounds on Capitol Hill this week, testifying before committees of jurisdiction to defend the spending and policy priorities set forth in the budget request. This included testimony by Office of Management and Budget (OMB) Director Vought before the House and Senate Budget Committees, along with HHS Secretary Kennedy’s first three (of seven) appearances before relevant committees.

The morning of April 16, 2026, Secretary Kennedy testified before the House Ways and Means Committee, where Democrats questioned his qualifications and vaccine-related messaging while raising concerns about proposed research cuts, and Republicans highlighted Secretary Kennedy and HHS’ efforts to improve nutrition, transparency, and patient choice. Discussion focused on rural health funding and safeguards, Medicare coverage for preventive services, support for accelerating access to breakthrough technologies, debate over vaccine policy and National Institutes of Health (NIH) funding, and calls to fully implement the No Surprises Act, as Kennedy emphasized HHS initiatives under the Make America Healthy Again (MAHA) agenda.

That afternoon, Secretary Kennedy appeared before the House Appropriations Labor-HHS Subcommittee, where Democrats raised concerns about withheld appropriated funds, staffing decisions, and proposed funding cuts, while Republicans voiced support for the MAHA agenda and called for stricter policies on abortion-related funding. Members on both sides emphasized the importance of sustained NIH funding, with discussion focusing on delays in disbursing funds to programs like the 988 line, HHS staffing changes, and broader concerns over potential impacts of funding reductions, as Kennedy highlighted ongoing efforts to address chronic disease, drug pricing through Most Favored Nation policies, and nutrition initiatives.

On April 17, 2026, Secretary Kennedy gave testimony at the House Committee on Education and Workforce where Democrats questioned his leadership and past statements on autism, vaccines, and research, while Republicans supported his focus on chronic disease prevention and nutrition reforms.

. Discussion centered on pharmacy benefit managers (PBMs) and prior authorization barriers, concerns over proposed cuts to mental health and NIH research funding, and the need to address the opioid crisis, as Kennedy highlighted efforts tied to the MAHA agenda, including drug pricing transparency and new maternal health pilot programs.

Next week, Secretary Kennedy is scheduled to testify before the House Energy and Commerce Committee, the Senate Appropriations Labor-HHS Subcommittee, the Senate Finance Committee, and the Senate Committee on Health, Education, Labor, and Pensions (HELP).

House Committee on Oversight and Government Reform discusses fraud in federally funded programs run by states. During the hearing, Republican committee members asked witnesses about what tools states have to ensure program integrity in programs like Medicaid and Social Security and how accountability at senior leadership levels is maintained to prevent fraud, while Democrats emphasized the need for program oversight and expressed concerns about the administration’s firings and budget cuts toward inspectors general. The four hearing witnesses emphasized that state leaders must acknowledge the fraud within their programs and set forth various solutions on how to ensure states can conduct better oversight of their programs. The hearing included testimony from the US Government Accountability Office (GAO), whose testimony outlined the scale and complexity of fraud across federal programs, estimating annual losses between $233 billion and $521 billion based on FY 2018 – 2022 data, and highlighted challenges in prevention due to decentralized program delivery, data limitations, and coordination barriers between federal and state agencies. More information can be found in the full report and report highlights.

House Energy and Commerce Health Subcommittee reviews public health legislation. The committee reviewed legislation introduced by committee members in a number of public healthcare areas. Expert witnesses provided feedback on the bills. This was very much a bipartisan hearing with strong support for the various bills from members from both sides of the aisle:

• H.R. 4348, to reauthorize the Kay Hagan Tick Act, and for other purposes, which would reauthorize federal efforts to improve research, prevention, and education related to tick-borne diseases.
• H.R. 4541, Young Women’s Breast Health Education and Awareness Requires Learning Young Act (EARLY) Act Reauthorization of 2025, which would reauthorize programs to educate young women and providers about breast health and early detection.
• H.R. 3747, Accelerating Access to Dementia and Alzheimer’s Provider Training (ADAPT) Act, which would expand provider training to improve early diagnosis and care for patients with dementia and Alzheimer’s disease.
• H.R. 8209, School-Based Health Centers Reauthorization Act of 2026, which would reauthorize funding for school-based health centers to expand access to care for children and adolescents.
• H.R. 5160, Stem Cell Therapeutic and Research Reauthorization Act of 2025, which would reauthorize and support cord blood and stem cell research and treatment programs.
• H.R. 8205, Accelerating Access to Critical Therapies for ALS Reauthorization Act of 2026, which would reauthorize initiatives to support research and access to treatments for ALS.
• H.R. ____, Nutrition Education and Chronic Disease Prevention in Community Health Centers Act of 2026, which would support nutrition education and chronic disease prevention services in community health centers.
• H.R. 8201, Expanding Community Access to Health Services Act, which would amend the Public Health Service Act to require community health centers to provide behavioral and mental health and substance use disorder services.
• H.R. ____, Digital Health Screeners Act of 2026, which would codify Food and Drug Administration (FDA) guidelines that exclude low-risk products, such as wearable devices like fitness trackers, from regulation as medical devices, provided they do not make claims related to diagnosing or treating diseases.

Senate HELP Committee examines factors contributing to drug pricing.  During the hearing, Republican committee members emphasized the need for more competition in the pharmaceutical market and highlighted how recent executive actions, including TrumpRx, are working to lower drug prices. Democrat committee members discussed patent reforms that could curb anti-competitive practices and raised concerns that the administration’s tariffs will further increase drug prices and that TrumpRx will mislead patients. Witnesses and members broadly recommended that Congress act to increase transparency across the drug pricing system.

House Ways and Means Health Subcommittee holds field hearing on healthcare modernization. During the hearing, held at the Lake Erie College of Osteopathic Medicine in Bradenton, Florida, Republican committee members emphasized the high healthcare spending in the United States and increasing rates of chronic diseases, emphasizing the need for better prevention policies, including enhanced screenings, improved access to technology, and healthy eating. Witnesses and members specifically highlighted how expanded access to innovative technologies, including telemedicine, digital pathology, and robotic surgery technology, can help prevent and treat chronic illnesses, particularly for people living in rural areas. Rep. Horsford (D-NV), the sole Democrat committee member in attendance, raised concerns with the increases in healthcare costs and the rising uninsurance rate, while urging members to work in a bipartisan fashion to enact reforms to improve health access, affordability, and outcomes.

Administration

CMS releases FY 2027 Medicare IPPS proposed rule. On April 10, 2026, CMS issued the proposed IPPS rule. Key takeaways from the proposed rule include:

• Payment amount: CMS proposes a 2.4% increase in operating payment rates for general acute care hospitals paid under the IPPS that successfully participate in the Hospital Inpatient Quality Reporting (IQR) Program and are meaningful electronic health record (EHR) users. This reflects a projected FY 2027 hospital market basket increase of 3.2%, less a 0.8 percentage point productivity adjustment.
• Comprehensive Care for Joint Replacement Expanded (CJR-X) Model: CMS proposes to nationalize the Comprehensive Care for Joint Replacement (CJR) demonstration that ran from 2016 through 2024. If finalized, all hospitals billing Medicare Parts A and B would be required to participate in either the CJR-X model or the Transforming Episode Accountability Model (TEAM) for lower-extremity joint replacement episodes among Medicare fee-for-service beneficiaries.
• Uncompensated care payment and supplemental payments: Proposed uncompensated care payment and supplemental payment for FY 2027 totals $7.563 billion, a 3.3% decrease from the FY 2026 total of $7.821 billion.
• Graduate medical education (GME): CMS is proposing requirements to prohibit unlawful discrimination by GME programs and to modify the criteria for identifying new residency programs for purposes of direct GME and indirect medical education payments.
• New technology add-on payments (NTAPs): CMS proposes to eliminate the alternate pathways for new technology add-on payments under IPPS and the transitional pass-through under the Outpatient Prospective Payment system, requiring medical devices with breakthrough device designation (BDD) to meet the same eligibility criteria as non-BDD technologies.

Comments on the proposed rule are due by June 9, 2026. More information on the proposed rule can be found in a CMS fact sheet.

CMS, ONC issue Interoperability Standards and Prior Authorization for Drugs proposed rule. On April 10, 2026, CMS and ONC issued a proposed rule to apply interoperability standards and ePA requirements for drugs, impacting Medicare Advantage (MA) organizations, Medicaid and Children’s Health Insurance Program (CHIP) programs, and qualified health plan (QHP) issuers on the federally-facilitated exchanges (FFEs).

Key takeaways from the proposed rule include:

• ePA requirements: Beginning October 1, 2027, CMS/ONC proposes impacted payers to implement and maintain a Prior Authorization (PA) API to facilitate ePA for drugs covered under a medical benefit. This change would align Prior Authorization API standards for drugs with those for non-drug items and services.
• Fast Healthcare Interoperability Resources (FHIR) standard for PA-related transactions: CMS/ONC proposes adopting HL7 FHIR standards and implementation guides (IGs) for referral certification/authorization and eligibility transactions, and the Da Vinci Clinical Data Exchange (CDex) IG for attachments. Compliance would be required within 24 months of the final rule’s effective date (36 months for small health plans).
• Payer reporting of application programming interfaces (API) endpoints: Impacted payers would be required to report interoperability API endpoints, FHIR capability statements, and technical documentation URLs to CMS for centralized publication. Reporting would be required within 60 days of the final rule (or before covering patients for new payers), with updates required within one week of changes and annual verification. CMS also proposes an alternative reporting pathway using the National Directory of Healthcare Providers & Services IG Endpoint Profile.
• Timeframes for PA decisions for drugs: Beginning October 1, 2027, Medicaid and CHIP programs and managed care entities would be required to make PA decisions within 24 hours. QHP issuers on the FFEs would be required to decide within 72 hours for standard requests and 24 hours for expedited requests, and all impacted payers would need to provide specific reasons for denials.
• Timeframes for PA decisions for non-drug items and services: QHP issuers on the FFEs would be required to make decisions within 7 calendar days for standard requests and 72 hours for expedited requests.
• Updated health IT standards: ONC proposes adopting updated interoperability standards and sunsetting older versions by January 1, 2028. CMS would require use of current (unexpired) standards without needing additional rulemaking, allowing flexibility to adopt newer versions.

The proposed rule also includes five standalone RFIs:

• Electronic event notifications for value-based care and care coordination: CMS seeks feedback on use and content of patient-event notifications, the types of providers and entities receiving patient-event notifications, technical approaches to patient-event notifications, and enforcement and complementary policy approaches, such as ways to leverage the Trusted Exchange Framework and Common Agreement (TEFCA) network.
• Increasing healthcare resiliency: CMS seeks feedback on how it can leverage its authorities to supplement regulations and guidance from other agencies to address cyber threats. This RFI focuses on cybersecurity, standards and technologies, and point-to-point connections.
• Improving implementation of payer application programming interface technology: CMS seeks feedback on steps it could take to improve oversight of payer APIs, as well as opportunities to leverage existing programs to help ensure that API technology used by payers meets CMS’ technical requirements.
• Step therapy: CMS seeks feedback on ways to streamline the step therapy process through technology and data sharing and how technology may facilitate step therapy determinations and improve current step therapy processes.
• Laboratory tests and durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) items: CMS seeks feedback on how PA for laboratory tests and DMEPOS items impact patient care and provider burden and what can be done to mitigate that burden.

More information on the proposed rule can be found in a CMS fact sheet and the press release. Comments are due by June 15, 2026.

CMMI extends ACCESS application deadline, announces accepted applicants. CMMI announced that more than 150 health care organizations had been accepted to participate in the launch of the voluntary ACCESS model, which aims to expand technology-enabled care for chronic conditions among Medicare beneficiaries. CMS noted that many of the accepted participants are new to serving Medicare patients. In the same press release, CMS announced the extension of the application deadline to May 15, 2026, to allow additional organizations time to apply and broaden participation ahead of the model’s July 5, 2026, launch. Applications received after May 15, 2026, will be considered for a January 1, 2027, start. More information on ACCESS can be found on the request for applications and the ACCESS model website. 

Quick Hits

• President Trump nominates CDC Director. On April 16, 2026, Erica Schwartz, MD, JD, MPH, former rear admiral in the Public Health Service Commissioned Corps and U.S. Coast Guard Chief Medical Officer, was nominated for the role of Director of the Centers for Disease Control and Prevention (CDC). She most recently served as Deputy Surgeon General during the first Trump administration and during the transition to the Biden administration. Her confirmation will require approval from the Senate.
• Senators Wyden and Whitehouse question DHS access to FPLS database. Senators Wyden (D-OR) and Whitehouse (D-RI) wrote to HHS Secretary Kennedy requesting answers by April 30, 2026, regarding reports that HHS may share sensitive data from the Federal Parent Locator Service (FPLS) with the Department of Homeland Security (DHS) for immigration enforcement, raising legal and privacy concerns about misuse of information intended to support child welfare.
• HELP Chair Cassidy releases healthcare agenda infographic. Sen. Cassidy (R-LA) released his Money and Value for Patients (MVP) agenda, outlining goals to approve healthcare affordability. The MVP agenda includes expanding TrumpRx and access to safe and nutritious foods and giving money directly to patients to help cover their out-of-pocket health costs.

Next Week’s Diagnosis

Congress will be in session next week, when HHS Secretary Kennedy will return to the Hill for continued budget hearings with the House Energy and Commerce Committee, the Senate Appropriations Labor-HHS Subcommittee, the Senate Finance Committee, and the Senate HELP Committee. The House Ways and Means Committee will hold a hearing on Medicare fraud, and the House Education and Workforce Committee will hold a hearing on PBMs

On the regulatory front, we await the federal independent dispute resolution operations rule and the final Notice of Benefit and Payment Parameters for 2027.