MONDAY MORNING (5/12) UPDATE:

Late last night, the House Energy & Commerce Committee released a draft of their components of the bill, i.e. the pieces affecting Medicaid. You can access a copy of the summary here (PDF). The full bill text can be found at the central Energy & Commerce page.

Several initial thoughts on the text:

• The bill freezes existing provider taxes where they currently stand without any cuts. It also imposes a moratorium on any new provider taxes.

• They capped the retro eligibility for Medicaid at one month from the day of the application, as opposed to the current three months.

• There are quite a few provisions related to the expansion population, including (as expected) work requirements, updated eligibility checks, and other changes to the FMAP formula for those populations.

• The minimum staffing mandate is delayed until 2035. As the rule is mostly dead legally, this is likely more of a bookkeeping move to accrue savings.

• There’s a provision that bans “spread pricing” by PBM’s.

• The bill would authorize $500M to the feds for AI modernization, while banning state regulation of AI models for ten years.

• Not sure in which settings this would apply, but the bill also implements a $35 co-pay for Medicaid services by beneficiaries.

In support of the bill, and likely anticipating pushback from conservatives who are unhappy that the bill doesn't cut enough, Chairman Brett Gutthrie wrote an op-ed in the Wall Street Journal defending the bill.

Meanwhile, Senator Josh Hawley wrote an op-ed urging Republicans to protect Medicaid and not make any cuts whatsoever.

In terms of timing, the bill markup will take place tomorrow (5/13) at 2 PM.

There is no guarantee that the bill will pass as currently written as there are plenty of other moving pieces, in this committee as well as in the tax-writing pieces of the bill, but this is the starting point for the public portions of the debate.

WHITE HOUSE:

The White House focused this week on new trade deals with the United Kingdom and China, rethinking federal oversight and funding of biological research, and working to improve the efficiency of the Federal Register (which is where federal regulations get posted). Four items of indirect interest:

• • The President signed an Executive Order that is designed to incentivize domestic pharmaceutical manufacturing in the United States. Especially for those who partner with pharmacies it’s something to be aware of.

• • Another Executive Order rescinds water pressure standards and looks to roll back energy efficiency standards related to dishwashers, washing machines, and other water regulations. It’s unclear if this will have any impact on commercial settings, but it’s something to monitor.

• • They established a new “National Center for Warrior Independence” in Los Angeles to help homeless veterans get back on their feet. While obviously geared towards veterans specifically in the area, the goal is to help veterans better access their benefits and any necessary care. The order also expressly authorizes a study to see if another center can be brought to New Hampshire. Ultimately, there may be opportunities to better coordinate care with the VA for veterans and potentially hiring opportunities.

• • In celebration of National Nurses Day, they issued a proclamation in support of nurses. In the proclamation, they mentioned refocusing the Public Service Loan Forgiveness program to encourage folks to enter the nursing profession. While sparse on details, this can be a valuable tool to help tackle the workforce shortage.

CONGRESS:

House Republicans continue to struggle with the “Big Beautiful Bill” of Reconciliation. Complicating matters for Speaker Mike Johnson was the Treasury’s announcement (PDF) that the “X-date”, i.e. the date when the US government will hit the debt ceiling, is expected to be in August, adding pressure to get a deal done that includes a debt limit increase, something that conservatives have a real problem with. Recognizing his dwindling options, the Speaker is exploring a smaller spending bill (something conservatives want) and taking FMAP cuts off the table (although this remains up in the airamid conservative pushback). With Congressman Mike Lawler publicly stating he won’t support cuts to provider taxes, and a new CBO report pointing out just how devastating cuts to Medicaid would be for beneficiaries, the political math remains as difficult as ever. Elsewhere in the political world:

• • A strong alternative to Medicaid cuts came from a most unlikely source this week as many progressive Democrats suggested Medicare Advantage as a prime source of real fraud, waste, and abuse and a better choice for Republicans looking for savings. Citing reporting from the Wall Street Journal that found more than $50 billion in fraudulent upcoding, as well as reports from MedPAC that found $83 billion in overpayments to MA programs, the full letter (PDF) is a worthwhile read.

• • With such a wonky policy like provider taxes all the rage, the NY Times did a deep dive on how they work and which states would feel the cuts the most.

• • We should begin to see specific language for the bill this week with the first mark-ups of the tax portions in the Ways & Means committee and the Medicaid components in the Energy & Commerce committee both scheduled for this Tuesday at 2 PM.

• • Is it ever too early to think elections in DC? The constant discussions about Medicaid are shaping up as one of the key issues in early campaigning even as the President is committed to making sure the Republicans keep their Congressional majorities. Along those lines, an early look from Roll Call at the most vulnerable House members.

• • While the focus remains the financial pieces of Reconciliation, there is a strong push by conservatives to include language in the bill that would fundamentally change how regulations are made, passed, and maintained in federal government, and which could have a profound impact on all regulated industries.

AGENCIES:

Late Friday, CMS released an updated guide to the CHOW revalidations process. You can access it here (PDF).

CMS released an updated infographic on how they plan on calculating incentive payment multipliers for the FY2026 value-based purchasing program. It’s available here (PDF).

The Department of Labor announced that they will not be enforcing the Biden-era rule on how to classify independent contractors. The formal bulletin is here (PDF).

Going a little far afield here, but considering how many of you are frequent flyers, and we do monitor agencies, this announcement from the FAA that they are planning on updating the air traffic control system is quite welcome…

FROM THE NOTEBOOK:

• • A good read from Kaiser Health News serves as a reminder that it’s not just SNF’s that benefit from provider taxes. Hospitals, especially in rural areas, are a prime beneficiary of the program too.

• • HealthAffairs suggested several alternatives for healthcare savings that don’t touch Medicaid.

• • California is heading into a deep budget crunch, even before any federal cuts are considered.

• • It looks like many of those cancelled DOGE contracts have come backto life…

• • Minnesota might actually be funding pay raises for their healthcare workers, quite a novel concept!

• • Looks like the United Kingdom wants to bring healthcare jobs back home as the government is limiting the number of immigrant healthcare workers that care homes can hire.