Kennedy Highlights Rural Health, Avoids ACA Credit Question

Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. testified before the Senate Finance Committee on September 4, focusing on the administration’s new Rural Health Transformation Program. He described it as a major federal investment in rural hospitals, earning support from several Republican senators, though Democratic Senator Bernie Sanders stated it represents a net reduction in funding. The Secretary and Democratic lawmakers sparred over his choice to remove the head of the Centers for Disease Control and his shake-up of the Advisory Committee on Immunization Practices (ACIP), which now has an entirely new membership, with many members sharing RFK Jr.’s skepticism of vaccines. Some Republican Senators did broach the controversial vaccine topic with Secretary Kennedy, highlighting President Trump’s success with Operation Warp Speed and the effectiveness of the COVID-19 vaccine. Finally, Kennedy did not provide a definite position on extending the enhanced Affordable Care Act tax credits, which are set to expire at the end of the year. Insurers are pressuring Congress to act before fall premium notices go out to avoid higher costs for consumers. Moderate Republicans have proposed a one-year extension, and the administration has introduced a hardship exemption allowing some consumers to enroll in catastrophic coverage if the credits lapse. Democrats pressed Kennedy on higher Medicare Part B and Part D premiums from subsidy cuts, but he didn’t explain how seniors might be affected, instead pointing to program oversight efforts (Inside Health Policy, September 4; Fierce Healthcare, September 4).

HHS Expands Access to Catastrophic Plan for Young Americans at Risk of Losing Health Insurance

On September 4, ahead of the expiration of enhanced premium tax credits for marketplace coverage, HHS announced an initiative to expand access to catastrophic health coverage. Such plans are designed to protect consumers from unexpected high medical costs, though they often come with high deductibles. The guidance streamlines access to catastrophic coverage for individuals who are ineligible for advance payments of the premium tax credit (APTC) or cost-sharing reductions (CSRs). Those interested may apply online on Healthcare.gov, through a certified partner, or submit a hardship exemption form by mail beginning November 1 (HHS, September 4; Fierce Healthcare, September 4).

Ten House Republicans Introduce Bill to Extend ACA Tax Credits

With the expiration of enhanced premium tax credits at the end of 2025 approaching, some House Republicans have shown their support for extending the credits. Representative Brian Fitzpatrick (R-PA), the chairman of the Working Family Tax Team, alongside Problem Solvers Caucus Co-Chair Tom Suozzi (D-NY) and a bipartisan group of legislators, has advanced a bill to extend premium tax credits through 2026. Supporters of this move say that it will ensure market stability and premium rates and maintain expanded eligibility for families who earn above 400% of the FPL. The coalition looks to other legislators for support, though many do not see an urgency for immediate action given that the credits do not expire until the end of the year (Politico Pro, September 4; Brian Fitzpatrick, September 4).

CMS and SAMHSA Release SHO on Best Practices for Continuum of Crisis Services

On September 5, CMS released a joint State Health Official (SHO) Letter (SHO-25-004) with the Substance Abuse and Mental Health Services Administration (SAMHSA) to provide guidance on best practices for implementing the continuum of crisis services. This SHO includes information on the essential elements of a continuum of care, like hotlines and mobile crisis and outreach services, and considerations on how to bolster response. Next, the SHO details strategies states can take to provide accessible and timely crisis services, including ways to expand workforce capacity and coordinate across various programs. The letter also highlights how Medicaid and CHIP can be leveraged to cover the cost of these services through State Plans, various waivers, managed care, and presumptive eligibility. This includes information about methods that can be utilized to maximize administrative claiming, claims processing, and fee-for-service rate setting. Finally, the SHO letter describes how states should begin thinking about service and funding coordination as well as best practices to monitor utilization and outcomes of services (Medicaid.gov, September 5).

CMS Investigating Medicaid Spending on Healthcare for Undocumented Immigrants

CMS is implementing probes into Medicaid spending on undocumented immigrants, with the goal of reducing fraud, waste, and abuse, according to public documents obtained by KFF Health News and The Associated Press. The agency has notified at least 6 states — California, Colorado, Illinois, Minnesota, Oregon, and Washington — that it will be reviewing both federal and state payments for medical service and prescription drug claims to ensure financial integrity. Notably, all six states are Democratically led and already provide some healthcare coverage to undocumented immigrants. There are fourteen states plus Washington D.C. that opt to cover children without legal status under Medicaid, with half also providing coverage to adults without legal status. Although CMS has declined to release a full list of states that it intends to investigate, KFF and AP report that it appears the agency is focusing on states that have elected to cover both children and adults. States are allowed to bill the federal government for emergency services and pregnancy care provided to anyone, regardless of immigration status. However, HR 1 will reduce emergency FMAP for services provided to individuals without legal status, among other policies that limit coverage to immigrants with temporary legal status (KFF Health News, September 5).

Make Children Healthy Again Report Officially Released

The official Make Our Children Healthy Again report was released on September 9, detailing recommendations from the MAHA Commission to address its identified causes of chronic childhood disease: poor diet, chemical exposure, lack of physical activity and chronic stress, and overmedicalization. The official report signifies a win for some industry interests, as it does not recommend significant restrictions on farming practices or food production. No additional changes were made in the MAHA report to Medicaid policies. It states that CMS will work with states to establish improved quality metrics for children enrolled in managed care plans as well as enhance prior authorization requirements and other safeguards to prevent the overuse of medications (Politico, September 9).

CMS Issues Guidance to QHPs on Actuarial Value Requirements

On September 5, CMS issued guidance to Qualified Health Plans (QHPs) with an updated timeline to revise their 2026 plans in response to a federal court’s decision to block implementation of certain parts of the Marketplace Integrity and Affordability Final Rule. In the final rule, CMS revised the de minimis range for meeting the actuarial value (AV) requirements of health plans, allowing issuers greater flexibility to meet the AV requirements. However, on August 22, a district court judge blocked implementation of this and other policies that CMS sought to implement for the 2026 plan year. While the Trump Administration is working for a total appeal of the decision, the Department of Justice requested that HHS be able to move forward with the de minimis changes, stating that 80% of issuers on healthcare.gov had utilized the new policy. The DOJ argued that the stay would cause these issuers to refile and negatively impact the open enrollment period, reducing consumer choice. The court has not yet provided a decision to the DOJ. CMS’ new guidance states that plans using the AV ranges in the final rule must be revised and refiled with the agency. The guidance indicates that CMS will finalize its review of revised QHP filings by September 29 (Inside Health Policy, September 8).