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Wednesday, July 29 · 20 stories
- Federal Policy
AHRQ Grant Spending Down 95% Despite Congressional Appropriation
The Agency for Healthcare Research and Quality has spent less than $15 million of its $345 million fiscal year 2026 appropriation on grants and has not issued new grants in over a year. The agency typically funds health services research including quality measurement, patient safety, and care delivery studies that inform Medicaid program design and quality initiatives. The spending freeze affects research that state Medicaid agencies and managed care plans rely on for evidence-based policy development, quality improvement, and payment reform.
- Industry
HHS Launches Behavioral Health Pledge as Optum Signs On First
HHS is introducing a behavioral health pledge on July 29, 2026, to advance mental health and addiction care nationwide, bringing together payers and medical associations in Washington, D.C. Optum will be the first private-sector company to sign the pledge, according to CEO Patrick Conway, and is simultaneously rolling out new behavioral health products. The pledge aims to expand access to mental health and substance use disorder services across the healthcare system. This represents a coordinated public-private effort to address behavioral health access gaps that affect Medicaid programs, which cover a disproportionate share of Americans with serious mental illness and substance use disorders.
- Legal
Hospice Fraud Scrutiny Raises Concerns About Patient Access and Regulatory Overreach
Health policy researchers and hospice providers warn that heightened fraud enforcement and negative attention on the hospice industry could lead to overly restrictive regulations that limit patient access to end-of-life care. The concerns emerge as federal enforcement actions against fraudulent hospice operators have intensified. While stakeholders acknowledge fraud exists and requires intervention, they caution that broad-brush regulatory responses could penalize compliant providers and restrict legitimate hospice utilization. The tension reflects ongoing challenges in Medicaid and Medicare hospice program integrity.
- Federal Policy
Senator Kim Introduces MediKids Act for Universal Child Health Coverage
Sen. Andy Kim (D-NJ) introduced S. 5037, the MediKids Act, to establish guaranteed healthcare coverage for all children in America. The bill was cosponsored by four Democratic senators and referred to the Senate Finance Committee. No timeline for committee consideration has been announced. If enacted, the legislation would significantly expand federal health coverage for children beyond current Medicaid and CHIP eligibility thresholds, affecting state program design and federal-state financing arrangements.
Tuesday, July 28 · 19 stories
- Industry
Flourish Health Raises $26M Series A for In-Home Youth Mental Health Services
Flourish Health, a youth mental health provider offering in-home visits for young people with serious, complex behavioral health needs, raised $26 million in Series A funding led by B Capital, F-Prime, and Cherryrock Capital. The round brings total funding to $46 million. The company provides home-based care through specialized workers for youth with high-acuity mental health conditions. This expansion comes as states increasingly contract with specialized behavioral health providers to serve high-need Medicaid populations, particularly children with serious emotional disturbance.
- Federal Policy
ACA Marketplace Enrollment Drops 15% After Enhanced Premium Tax Credits Expire in 2026
ACA Marketplace enrollment declined nationwide in 2026 for the first time in seven years following the expiration of temporary enhanced premium tax credits, with all states except New Mexico experiencing enrollment losses. Enrollment fell 15% on the federal marketplace (HealthCare.gov), while state-based marketplaces saw smaller declines averaging 6%, particularly in states that partially offset the federal subsidy loss with state funds. The enhanced subsidies, which had driven enrollment growth since their introduction, expired at the end of 2025.
- Industry
UHS Says Talkspace Acquisition Will Expand Outpatient Behavioral Health Capacity
Universal Health Services executives stated the pending Talkspace acquisition will address two key obstacles to outpatient behavioral health growth: access to virtual care and therapist capacity for post-discharge patients. UHS CFO Steve Filton described Talkspace as providing both a virtual delivery platform and a larger therapist network to serve patients transitioning from inpatient settings. The acquisition, announced earlier in 2026, is positioned as an accelerant for UHS's outpatient behavioral health expansion strategy. This reflects ongoing consolidation in behavioral health delivery and growing emphasis on virtual care integration.
- Legal
D.C. Circuit Upholds CMS Authority to Retain MA Survey Data in Star Ratings
On July 14, 2026, the D.C. Circuit Court of Appeals affirmed a district court ruling that upheld CMS's decision to retain survey data used in Medicare Advantage star ratings, rejecting Alignment Healthcare's challenge that the agency acted arbitrarily by refusing to discard the data. The decision reinforces CMS's discretion in administering the star ratings methodology and handling plan-specific data challenges. While this case involves Medicare Advantage rather than Medicaid managed care, it establishes precedent for CMS's authority over survey-based quality measurement systems that parallel those used in Medicaid managed care quality rating systems in multiple states.
- Federal Policy
CMS Proposes Removing 638 Additional Procedures from Medicare Inpatient-Only List for 2027
CMS proposed removing 638 procedures from the Medicare Inpatient Only List in the CY 2027 OPPS/ASC Proposed Rule, effective January 1, 2027. This follows removal of 285 procedures in CY 2026. The broader scope includes surgical services beyond the 2026 focus on musculoskeletal procedures. The removals affect whether procedures must be performed in inpatient settings or can shift to outpatient settings under Medicare payment rules.
- Federal Policy
HHS OIG Audits Department AI Governance Framework for Federal Compliance
The HHS Office of Inspector General has initiated an audit examining whether the Department of Health and Human Services has established adequate governance for developing and deploying artificial intelligence tools across its operations. The audit will assess compliance with federal requirements, including National Institute of Standards and Technology AI risk management standards and departmental policies. The review covers AI governance structures affecting HHS agencies including CMS. The audit's scope and timeline for completion have not been publicly specified.
- Federal Policy
CMS Proposes Mandatory 340B Claims Data Reporting for Medicare Part D
CMS published the 2027 Physician Fee Schedule proposed rule on July 16, proposing to make 340B claims data reporting mandatory for covered entities participating in Medicare Part D, converting what was previously a voluntary submission. The proposal would require 340B covered entities to submit Part D claims data to the Medicare Part D Claims Data 340B Repository starting in 2027. This change affects hospitals, federally qualified health centers, and other 340B covered entities that dispense drugs under Medicare Part D, requiring new compliance infrastructure and potentially increasing administrative burden for entities that have not voluntarily reported to date.
- State Policy · NM
New Mexico Reports Doubled Postpartum Visits After 2022 Medicaid Extension
New Mexico Department of Health reported that its 2022 Medicaid postpartum coverage extension doubled medical visits among new mothers, according to preliminary evaluation results. The extension, implemented in 2022, expanded postpartum Medicaid coverage beyond the standard 60-day period. State officials cite the increased utilization as evidence the policy may help reduce maternal mortality. The evaluation is ongoing and final results have not been released.
- Industry
Centene Reports $1B Profit in Q2, Raises 2026 Earnings Outlook
Centene swung to more than $1 billion in profit in the second quarter of 2026, marking a significant turnaround for the managed care giant. The company raised its full-year 2026 earnings outlook for the second time this year following what its CFO described as "fantastic" results. The strong performance comes after previous quarters of financial challenges and represents improved operational execution across Centene's health plan portfolio, which includes substantial Medicaid managed care operations in multiple states.
- Federal Policy
CMS Electronic Prior Authorization Requirements Take Effect January 1, 2027 for Medicare Advantage and Medicaid Managed Care
On January 1, 2027, Medicare Advantage organizations, Medicaid managed care plans, CHIP managed care entities, and federally facilitated exchange QHP issuers must support electronic prior authorization through standardized APIs under CMS's 2024 Interoperability and Prior Authorization final rule. The rule requires impacted payers to enable providers to determine prior authorization requirements, submit requests, and receive approval decisions electronically through EHR integration, using standardized HL7 FHIR-based workflows. The rule does not eliminate prior authorization or change medical necessity criteria — it standardizes the electronic exchange of prior authorization information between providers and health plans. Hospitals should engage EHR vendors and health plans now to prepare workflows, test systems, and train staff before implementation.
- State Policy · IN
Indiana Imposes Six-Month Enrollment Moratorium on HCBS Waiver Providers Effective August 1
Indiana received CMS approval to implement a statewide provider certification and enrollment moratorium for multiple Home- and Community-Based Services (HCBS) 1915(c) waiver provider types. The moratorium takes effect August 1, 2026, and will initially remain in place for six months. The action halts new HCBS provider certifications and enrollments across Indiana's waiver programs during this period. Indiana Medicaid managed care organizations will be unable to contract with new HCBS providers in the affected categories while the moratorium is in effect, potentially limiting network expansion and member access to services.
- Managed Care · CT
Connecticut Hospitals Redesign Emergency Departments for Behavioral Health Crises
Hospitals in Connecticut are redesigning emergency rooms to better accommodate patients experiencing behavioral health crises. Physicians and hospital leaders report the specialized units create calmer, more therapeutic environments compared to traditional ERs. The redesigns address growing demand for mental health crisis services in emergency settings. The changes affect how Medicaid managed care organizations coordinate behavioral health emergency services and may influence network adequacy and crisis stabilization requirements.
- Industry
Tenet Raises 2026 Outlook Despite $65M ACA Exchange Loss in Q2
Tenet Healthcare raised its full-year 2026 financial outlook after absorbing a $65 million loss from instability in ACA marketplace enrollment during the second quarter. The hospital operator reported less severe impacts than some competing health systems facing similar exchange headwinds. The revised guidance suggests Tenet expects to offset ACA-related losses through other revenue streams for the remainder of the fiscal year. While ACA exchange disruption affects hospital uncompensated care and payer mix, the story centers on investor-oriented financial performance rather than direct Medicaid program operations.
- Federal Policy
CMS Publishes Q2 2026 Quarterly Listing of Medicare and Medicaid Program Issuances
CMS published its quarterly compilation of manual instructions, regulations, and Federal Register notices issued between April and June 2026 for Medicare, Medicaid, and other CMS-administered programs. This is a routine administrative notice that compiles previously issued guidance and rulemakings from the quarter into a single reference document. The listing provides a consolidated index of policy issuances for stakeholders tracking program changes. This quarterly publication serves as an administrative record and reference tool rather than announcing new policy.
- State Policy · AL
Alabama Democratic Gubernatorial Nominee Jones Calls for Medicaid Expansion
Former U.S. Senator Doug Jones, now the Democratic nominee for Alabama governor, delivered a policy speech Monday calling for Medicaid expansion alongside other reforms including a lottery vote and broader government participation measures. The speech outlined what Jones described as 'three real opportunities' for Alabamians, with Medicaid expansion positioned as part of his health policy agenda. Alabama remains one of the states that has not expanded Medicaid under the Affordable Care Act. The policy positions represent a traditional Democratic platform in a state where Medicaid expansion has faced consistent Republican opposition.
- Federal Policy
CMS Proposes Home Health Enrollment Changes to Reduce Fraud and Improper Payments
On July 1, 2026, CMS proposed enrollment-related policy changes under the Home Health Prospective Payment System aimed at reducing improper Medicare payments and protecting beneficiaries. The proposed rule introduces new enrollment requirements and fraud deterrence measures for home health providers. While the rule targets Medicare home health providers, states with Medicaid home health programs or 1915(c) waiver programs providing home and community-based services may see similar enrollment standards adopted or referenced in future Medicaid guidance. CMS has not specified a comment deadline or effective date in the summary provided.