Federal Government Remains Shut Down, CRs Fail to Pass

On October 6, the Senate failed to pass a continuing resolution (CR) for the fifth time, leaving the federal government in a shutdown. Only two Democratic Senators and one Independent voted for the House-approved CR, which would fund the government until November 21. On the other hand, Republicans failed to pass a Democratic CR, which included key policy priorities for the party: a permanent extension of the enhanced premium tax credits and restrictions on executive authority to rescind Congressionally approved funding. The majority leaders argue that they are willing to negotiate on healthcare once the government is funded. Democratic leaders are insistent on a “bipartisan negotiation” that includes healthcare in any CR that opens the government. Open enrollment for the Affordable Care Act Marketplace begins on November 1, a point that Democratic lawmakers have underscored (Politico, October 6).

States Have Potential to Add Additional Exemption for Work Requirements

A recent KFF analysis highlighted a key exemption in H.R.1’s new work requirements mandate states may consider as they begin implementation: individuals living in counties with high unemployment rates. The law allows an exemption for Medicaid enrollees who live in counties where unemployment is at least 8.5%, or 1.5 times the national unemployment rate. However, states must choose to apply for this exemption, and the federal government can set a limit on how long a county can be exempted. KFF’s analysis predicts that this exemption could impact millions of Medicaid enrollees, roughly 7% of enrollees who are subject to work requirements. The Supplemental Nutrition Assistance Program offers a similar exemption to its own work requirements. However, 18 states did not offer this option in 2023 (Modern Healthcare, October 3; KFF Health News, September 29; KFF, September 29).

CDC Updates Vaccine Policies Amid Push for Individual Decision-Making

The CDC, under Acting Director and Deputy HHS Secretary Jim O’Neill, approved the Advisory Committee on Immunization Practices’ (ACIP) recommendations on Oct. 6, endorsing an individual-based decision-making approach for the COVID-19 vaccine rather than a broad recommendation. The guidance advises individuals to consult their doctors about whether to receive the vaccine. This shift allows the Vaccines for Children (VFC) Program to continue covering COVID-19 vaccines while also removing VFC coverage for the combined measles, mumps, rubella, and varicella (MMRV) vaccine. O’Neill said the change restores “informed consent” and encourages personalized discussions between providers and patients. Under the new policy, COVID-19 vaccines remain covered by Medicare, Medicaid, CHIP, ACA-regulated plans, and VFC, though FDA approval now limits their use to adults 65 and older or those with risk factors. O’Neill also approved splitting the MMRV vaccine into separate MMR and varicella shots for young children, citing increased seizure risks with the combination vaccine. However, experts warn that requiring two injections could further reduce measles vaccination rates amid rising outbreaks. Over 1,500 cases have been confirmed in the U.S. this year, including a recent outbreak in South Carolina and a fatal infant case in Canada (Inside Health Policy, October 6).

Trump Administration Considers Tightening Social Security Disability Qualifications

The Trump administration is developing a proposal to tighten access to Social Security disability benefits, particularly for older applicants. The plan would remove or raise the age threshold currently used to assess whether people over 50 can adapt to new types of work, a change that could significantly narrow eligibility. Officials also intend to introduce a modern occupational database to replace the decades-old job listings used in disability determinations. Policy analysts estimate that if the new rule reduces eligibility by 10%, roughly 750,000 people could lose benefits over the next decade, cutting about $82B in total payments. Experts warn that many older applicants denied disability would likely turn to early retirement, resulting in permanently lower Social Security income. The administration frames the change as a modernization effort aimed at improving accuracy and efficiency, while critics, including disability advocates and Democratic lawmakers, argue it would disproportionately harm older and low-income Americans. The Social Security Administration is expected to release the proposal through the federal rulemaking process, allowing for public comment before final adoption. The agency is also weighing reversal of a Biden-era expansion of Supplemental Security Income (SSI) eligibility, which could lower payments for about 400,000 beneficiaries who share housing or food support. Together, the proposed adjustments reflect a broader push to tighten eligibility and reduce costs across Social Security’s disability and income-support programs (Washington Post, October 5).

Federal District Judge Denies Suit to Stop Final Rule on ACA Enrollment and Eligibility

On October 1, US District Judge Nathaniel Gorton of Massachusetts ruled against 21 state attorneys general in State of California, et al. v. Kennedy, a lawsuit seeking to block the ACA enrollment and eligibility final rule that has the potential to increase uncompensated care costs, declines in enrollment, and increase administrative costs for states upon regulation compliance. The rule also contains a provision that would prohibit gender-affirming services from being added as an essential health benefit (EHB). Judge Gorton argues that the plaintiffs were unable to prove that the implementation of said provisions would cause irreparable harm and that HHS’ actions in creating the regulation were not found to be arbitrary or capricious. Experts believe implementation of the rule could lead to higher out-of-pocket costs for millions across the US. Although the fight over this rule is not over however, as this ruling potentially causes a circuit split due to an injunction in a US District Court in Maryland in August that blocked seven provisions (Modern Healthcare, October 3; Inside Health Policy, October 3).

JAMA Study Finds Clinical Characteristics of Those at Risk of Losing Medicaid

A new study in Journal of the American Medical Association (JAMA) examines the clinical characteristics of adults that are at risk of losing their Medicaid coverage following work and community engagement requirements. CBO estimates that approximately 5 million adults are at risk of losing Medicaid. While some vulnerable groups are explicitly exempt under law, many enrollees may fall through the cracks due to documentation requirements and varying definitions of medical frailty, as its definition is up to a state’s discretion. In their surveyed population of Medicaid enrollees ages 20-64 who worked less than 20 hours per week, JAMA found that 41% of beneficiaries had three or more chronic conditions. Additionally, 20% of participants experienced conditions such as obesity, hypertension, arthritis, and depression (Healthcare Dive, October 6 ; JAMA, October 1).