Issue #266
Sellers Dorsey Digest
December 11, 2025
Federal News
AHIP Warns of Fraud Risks as Lawmakers Consider ACA Subsidy Extension
Insurers are urging Congress to extend the ACA’s enhanced subsidies while also adding stronger safeguards to prevent improper enrollment. Their call follows a GAO review showing that investigators were able to obtain marketplace coverage and tax credits using fabricated identities. AHIP says CMS has taken helpful steps to strengthen oversight, but more protections are needed to ensure subsidies go only to eligible individuals. Insurers support measures such as expanding multifactor authentication and improving eligibility checks for people who move between Medicaid and the exchanges. The issue is becoming more urgent because millions could face significant premium increases in 2026 if the subsidies expire. Lawmakers remain divided on how to proceed. Democrats want a straightforward extension to avoid a cost spike, while Republicans are pushing for broader reforms. Senate leaders have agreed to bring a three-year extension to a vote, and bipartisan proposals are still being discussed in the House (Fierce Healthcare, December 5).
HHS Releases Department-Wide Artificial Intelligence Strategy
On December 4, 2025, the U.S. Department of Health and Human Services (HHS) released its new AI Strategy outlining how the Department will integrate artificial intelligence (AI) across its operations, workforce, research, and public health programs. The plan aims to increase efficiency, support innovation, and improve health outcomes while aligning with federal AI directives. The strategy centers on five priorities: governance and risk management, modern infrastructure, workforce development and burden reduction, high-quality research, and modernization of care and public health delivery. Bipartisan lawmakers expressed support, noting AI’s potential to expand access, improve diagnoses, and lower costs when implemented responsibly. A key feature is the “OneHHS” approach, which brings agencies such as CDC, CMS, FDA, and NIH into a unified AI framework to streamline workflows and strengthen cybersecurity. HHS notes that this strategy focuses on internal federal use of AI and represents an early step toward deeper future collaboration with private-sector partners (HHS, December 4).
CDC Vaccine Advisory Votes to Drop Universal Hepatitis B Recommendations for Newborns
On December 5, the Advisory Committee on Immunization Practices (ACIP) voted to withdraw the recommendation that all babies receive the hepatitis B vaccine within 24 hours of birth. Those opposed to the move spoke to the lack of evidence of harm from being given the hepatitis B vaccine at birth and emphasized that the guidelines were never a mandate, but a recommendation for parents. Prior to the CDC’s universal hepatitis B vaccine recommendation, 20,000 newborns a year were infected with the disease, but in recent years that number has shrunk to less than 20 (Inside Health Policy, December 5).
New FDA Pilot Aims to Advance Technology-Enabled Chronic Care
The Food and Drug Administration (FDA) is launching a new pilot program, called TEMPO, to make it easier for patients to access digital health tools that help manage chronic conditions. Instead of requiring full clearance upfront, the agency will let selected manufacturers use their products while they collect real-world data showing how well the devices work. This effort is coordinated with CMS’s ACCESS model so both agencies can learn how technology performs in everyday care and whether it can improve outcomes for people with cardiometabolic, musculoskeletal, or behavioral health needs. The pilot is part of the FDA’s push to support home-based care and speed responsible innovation. Up to ten companies in each clinical area will be chosen starting in 2026. The goal is to modernize oversight, encourage safe digital health development, and expand access to technology-enabled chronic disease management (FDA, December 5).
CMS Releases CIB on Medicaid Community Engagement Requirements
On December 8, CMS released an Information Bulletin (CIB) regarding the new community engagement requirements in the Medicaid program as required by H.R. 1. The CIB provides an overview of the statute including populations that must comply with the requirements, who is excluded, and certain exceptions that are allowed under the law. Throughout the guidance, the agency explained the requirements in plain language. CMS offered one area of interpretation in this preliminary guidance: After enrollment, applicable individuals must meet community engagement requirements for at least one month before their eligibility redetermination, with states having the ability to require more months of compliance. CMS stated that it interpreted the law to mean that states can permit but may not require individuals to demonstrate compliance in consecutive months. However, states have the authority to verify compliance with community engagement requirements more frequently between redeterminations. The agency noted that further guidance on certain topics like MCO involvement and reliable data sources for compliance verification will be forthcoming. CMS must provide additional guidance through formal rulemaking by June 2026 (CMS.gov, December 8).
State News
Illinois Governor Signs Vaccination Protection Bill into Law
Following Governor JB Pritzker’s (D-IL) executive order in September calling on the Illinois Department of Public Health (IDPH) to lead a Statewide Vaccine Access Initiative, on December 2 he signed House Bill 767 into law, giving the department’s director the power to issue immunization guidelines. Based on input from the Illinois Immunization Advisory Committee (IL-IAC), an advisory group made up of public health and medical professionals, the director may also approve vaccinations for both routine and seasonal illnesses (NPR, December 2).
Louisiana DoH Severs Ties with UnitedHealthcare Due to Ongoing Litigation
On December 8, the Louisiana Department of Health announced that it would not renew its $4.2B Medicaid contract with UnitedHealthcare. Currently, the MCO covers about 330,000 of the state’s 1.4 million Medicaid enrollees. The decision leaves less than a month for the department to move enrollees into a new plan, although they estimate that the reassignments will take two weeks. The department plans to use an algorithm to aid in the process of enrolling beneficiaries into a new plan and will try to ensure that families will stay in the same company and that their physicians are in-network to ensure continuity of care. Initially, Aetna Better Health was among the payers whose contracts were set to be cut, but the department later announced that it would be renewing this contract. Enrollees who are unhappy with their reassignments will have 90 days to switch to a different plan. The contract termination is reportedly due to non-compliance with state regulations regarding pharmacy benefit managers. These changes will take effect on January 1, 2026 (Louisiana Illuminator, December 9; Shreveport Times, December 9).
SPAs and Waivers
SPAs
- Services
- Florida (FL-25-0008, effective September 30, 2025): Allows the state to voluntarily enter into value-based purchasing (VBP) arrangements with drug manufacturers.
- Payment
- Guam (GU-25-0002, effective July 1, 2025): Removes language referring to a specific source for average wholesale prices (AWPs) for prescription drugs. Also updates the fee schedules for physical and occupational therapy and prosthetic and orthotic devices.
- Maryland (MD-25-0013, effective July 8, 2025): Adds an eligibility requirement for states looking to receive funds from a pay-for-performance program that disallows nursing facility providers from being identified as failing to pay the quality assessment.
- Massachusetts (MA-25-0021, effective August 15, 2025): Updates payment methodologies for community behavioral health centers (CBHCs) providing mobile crisis intervention and standard and intensive outpatient services.
- Massachusetts (MA-25-0029, effective July 1, 2025): Updates payment methodologies for personal care attendants and transitional living providers.
- New Jersey (NJ-25-0009, effective July 16, 2025): Increases the per diem rate for medical day care providers.
- South Carolina (SC-24-0022, effective October 1, 2024): Adds partial hospitalization programs (PHP) and intensive outpatient programs (IOP) as services provided within outpatient hospitals, in relation to the psychiatric benefit.
State Directed Payment Preprints
- Delaware (Effective January 1, 2026): Renews a uniform percentage increase established by the state for personal care service claims for the rating period covering January 1, 2026 through December 31, 2026, incorporated in the capitation rates through a risk-based rate adjustment.
- Ohio (Effective January 1, 2025): Renews a uniform percentage increase for professional services provided by qualified practitioners affiliated with or employed by an academic medical center, at participating health systems affiliated with a public medical school in the Southwest class established by the state for the rating period January 1, 2025 through December 31, 2025,incorporated into the capitation rates through a risk-based adjustment and a separate payment term.
- New Mexico (Effective January 1, 2025): Renews a uniform dollar increase established by the state for eligible government-owned emergency medical transport providers for the rating period covering January 1, 2026 through December 31, 2026, incorporated in the capitation rates through a separate payment term.
- Ohio (Effective January 1, 2025): Renews a uniform percentage increase for professional services provided by qualified practitioners affiliated with or employed by an academic medical center, at participating health systems affiliated with a public medical school in the Northeast class established by the state for the rating period January 1, 2025 through December 31, 2025, incorporated into the capitation rates through a risk-based adjustment and a separate payment term.
- Arizona (Effective October 1, 2025): Renews a uniform increase provided by the eligible public safety net hospital established by the state for inpatient and outpatient hospital services for the rating period covering October 1, 2025 through September 30, 2026, incorporated into the capitation rate through a separate payment term.
- Delaware (Effective January 1, 2025): Establishes a Minimum Fee Schedule for nursing facility services for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- Rhode Island (Effective July 1, 2025): Renews a uniform increase established by the state for eligible inpatient and outpatient hospital services, for the rating period July 1, 2025 through June 30, 2026, incorporated into the capitation rates through a separate payment term.
- Louisiana (Effective July 1, 2025): Renews a uniform increase for in-state, non-rural providers of inpatient and outpatient hospital services, excluding freestanding psychiatric hospitals, freestanding rehabilitation hospitals, and long-term acute care hospitals, for the rating period, July 1, 2025 through June 30, 2026, incorporated into the capitation rates through a separate payment term.
- Louisiana (Effective July 1, 2025): Establishes a uniform increase for in-state, rural providers of inpatient and outpatient hospital services, excluding freestanding psychiatric hospitals, freestanding rehabilitation hospitals, and long-term acute care hospitals, for the rating period, July 1, 2025 through June 30, 2026, incorporated into the capitation rates through a separate payment term.
- Louisiana (Effective July 1, 2025): Renews a uniform increase for inpatient and outpatient hospital services by eligible in-state hospital providers of long-term acute care, psychiatric services, and rehabilitation services for the rating period, July 1, 2025 through June 30, 2026, incorporated into the capitation rates through a separate payment term.
- Louisiana (Effective July 1, 2025): Amends a uniform dollar increase for pediatric home health nurses established by the state for home health services for the rating period, July 1, 2025 through June 30, 2026, incorporated into the capitation rates through a separate payment term.
- New Jersey (Effective July 1, 2025): Renews a uniform dollar increase for acute care hospitals established by the state for outpatient hospital services for the rating period covering July 1, 2025, through June 30, 2026, incorporated in the capitation rates through a separate payment term.
- New Jersey (Effective July 1, 2023): Amends the uniform increase for inpatient hospital services provided by Mercer County hospitals for the rating period covering July 1, 2023 through June 30, 2024, incorporated in the capitation rates through a separate payment term.
- Arizona (Effective October 1, 2025): Renews a uniform increase for inpatient and outpatient hospital services at freestanding children’s hospitals with more than 100 licensed pediatric beds for the rating period covering October 1, 2025 through September 30, 2026, and incorporated in the capitation rates through a separate payment term.
- Arizona (Effective October 1, 2025): Renews a uniform percentage increase, entitled Access to Professional Services Initiative, established by the state for qualified practitioners affiliated with one of the designated hospitals for the rating period covering October 1, 2025 through September 30, 2026, incorporated into the capitation rate through a separate payment term of up to $388,330,000.
- Florida (Effective October 1, 2024): Renews a uniform dollar increase for publicly owned or operated emergency medical transportation provider services for rating period covering October 1, 2024 through January 31, 2025, and incorporated in the capitation rates through a separate payment term.
- Florida (Effective October 1, 2024): Renews a uniform percentage increase for primary care services and specialty physician services for rating period covering October 1, 2024 through January 31, 2025, and incorporated in the capitation rates through a separate payment term.
- Florida (Effective February 1, 2025): Renews a uniform percentage increase for primary care services and specialty physician services for rating period covering February 1, 2025 through September 30, 2025, incorporated in the capitation rates through a separate payment term.
- Florida (Effective October 1, 2025): Renews a uniform percentage increase for professional services at an academic medical center for rating periods covering October 1, 2024 through January 31, 2025, and incorporated in the capitation rates through a separate payment term.
- Florida (Effective February 1, 2025): Renews a uniform dollar increase for publicly owned or operated emergency medical transportation provider services for rating period covering February 1, 2025 through September 30, 2025, incorporated in the capitation rates through a separate payment term.
- Iowa (Effective July 1, 2025): Renews a Minimum Fee Schedule established by the state for eligible ground emergency transportation services for the rating period covering July 1, 2025 through June 30, 2026, incorporated in the capitation rates through a risk-based rate adjustment.
- Florida (Effective February 1, 2025): Renews a uniform percentage increase for professional services at an academic medical center for rating periods covering February 1, 2025 through September 30, 2025, incorporated in the capitation rates through a separate payment term.
- Maryland (Effective January 1, 2026): Renews a Minimum Fee Schedule for primary care services for the rating period covering January 1, 2026 through December 31, 2026, incorporated in the capitation rates through a risk-based rate adjustment.
- New Hampshire (Effective July 1, 2025): Renews a uniform dollar increase for inpatient and outpatient hospital services to qualifying non-critical access hospitals for rating periods covering July 1, 2025 through June 30, 2026, incorporated in the capitation rates through a separate payment term.
- Nebraska (Effective January 1, 2025): Renews a uniform increase for non-state owned or operated hospitals established by the state for inpatient and outpatient hospital services for the rating period, January 1, 2025 through December 31, 2025, incorporated into the capitation rates through a separate payment term.
- New Jersey (Effective July 1, 2025): Renews a uniform increase for nursing facility services provided by Class II (publicly owned) nursing facilities with greater than 500 licensed beds for the rating period, July 1, 2025 through June 30, 2026, incorporated into the capitation rates through a separate payment term.
- New Hampshire (Effective July 1, 2025): Establishes a uniform dollar increase for inpatient and outpatient hospital services to qualifying hospitals for rating periods covering July 1, 2025 through June 30, 2026, incorporated in the capitation rates through a separate payment term.
- Michigan (Effective October 1, 2025): Renews a uniform dollar increase established by the state for direct care workers providing personal care services to eligible enrollees for the rating period covering October 1, 2025, until September 30, 2026 incorporated in the capitation rates through a risk-based rate adjustment.
- North Carolina (Effective July 1, 2025): Renews a uniform dollar increase for eligible behavioral health inpatient services for the rating period covering July 1, 2025 through June 30, 2026, incorporated in the capitation rates through a risk-based rate adjustment.
- New Jersey (Effective July 1, 2025): Renews a uniform dollar increase for Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) screening services for the rating period covering July 1, 2025 through June 30, 2026, incorporated in the capitation rates through a risk-based rate adjustment.
- Maryland (Effective January 1, 2026): Renews a population-based payment for primary care services for the rating period covering January 1, 2026 through December 31, 2026, incorporated in the capitation rates through a separate payment term.
- New York (Effective April 1, 2025): Renews a uniform dollar increase for eligible inpatient hospital and outpatient hospital services at Government general hospitals, other than those operated by the State of New York or the State University of New York, located in a city with a population of over one million for the rating period covering April 1, 2025, through March 31, 2026, incorporated in the capitation rates through a separate payment term.
- New Mexico (Effective January 1, 2023): Amends a uniform percentage increase established by the state for qualified practitioners who are members of a practice plan under contract to provide professional services at a state-owned academic medical center for the rating period covering January 1, 2023 through December 31, 2023, incorporated in the capitation rates through a separate payment term.
- New Mexico (Effective January 1, 2026): Renews a uniform percentage increase established by the state for qualified practitioners who are members of a practice plan under contract to provide professional services at a state-owned academic medical center for the rating period covering January 1, 2026 through December 31, 2026, incorporated in the capitation rates through a separate payment term.
- Pennsylvania (Effective January 1, 2026): Renews a uniform percentage increase payment arrangement for professional services at an academic medical center for rating periods covering January 1, 2026, through December 31, 2026, incorporated in the capitation rates through a separate payment term.
- Rhode Island (Effective July 1, 2024): Amends a uniform percentage increase of 2.9% per claim for inpatient hospital services for rating period covering July 1, 2024, through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- South Carolina (Effective July 1, 2025): Renews a uniform increase established by the state for physicians providing professional services employed by or under contracts with South Carolina public medical university, academic medical center or its component units, or a South Carolina Area Health Education Consortium (AHEC) Teaching Health System for the rating period covering July 1, 2025 through July 30, 2026, incorporated in the capitation rates through a separate payment term.
- Washington (Effective January 1, 2025): Establishes a value-based pay for performance and population-based payment for behavioral health outpatient services provided by eligible mobile crisis response providers established by the state for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a separate payment term.
- Virginia (Effective July 1, 2025): Renews a uniform percentage increase University of Virginia, Virginia Commonwealth University and Eastern Virginia Medical Center for professional services at an academic medical center for rating periods covering July 1, 2025, through June 30, 2026, incorporated in the capitation rates through a separate payment term.
- Wisconsin (Effective January 1, 2025): Renews a uniform percentage increase established by the State for eligible home and community-based service (HCBS) services for rating periods covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a separate payment term.
- Virginia (Effective July 1, 2025): Amends a uniform percentage increase for inpatient hospital services and outpatient hospital services for rating periods covering July 1, 2024, through June 30, 2025, incorporated in the capitation rates through a separate payment term.
- Vermont (Effective January 1, 2025): Renews a value-based payment arrangement for the Patient-Centered Medical Home (PCMH) PPPM (Per Patient Per Month) Blueprint payment program for the rating periods covering January 1, 2025 through December 31, 2027, incorporated into the capitation rates through a risk-based rate adjustment.
- Wisconsin (Effective January 1, 2025): Renews a uniform dollar increase for eligible ground emergency ambulance services for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- Rhode Island (Effective July 1, 2025): Amends a uniform percentage increase of 2.9% for outpatient hospital services for the rating period covering July 1, 2024, through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- Virginia (Effective July 1, 2025): Renews a value-based payment arrangement for Nursing Facilities for rating periods covering July1, 2025, through June 30, 2026, incorporated in the capitation rates through a separate payment term.
- Wisconsin (Effective January 1, 2025): Renews a Minimum Fee Schedule for home and community-based services for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- Wisconsin (Effective January 1, 2025): Establishes a uniform percentage increase for professional services at an academic medical center for rating periods covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a separate payment term.
- New Mexico (Effective January 1, 2025): Establishes a uniform increase established by the state for Agency-Based Community Benefit services, for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- New York (Effective April 1, 2025): Renews a uniform increase for Critical Access Hospitals as established by the state for outpatient services for the rating period, April 1, 2025 through March 31, 2026, incorporated into the capitation rates through a separate payment term.
- Ohio (Effective January 1, 2025): Renews the Care Innovation and Community Improvement Program established by the state for the rating period covering January 1, 2025 through December 31, 2025, incorporated into the capitation rates through a risk-based rate adjustment and a separate payment term.
- Oregon (Effective January 1, 2025): Renews a uniform increase established by the state for inpatient and outpatient hospital services provided by qualifying public academic health centers for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a separate payment term.
- Pennsylvania (Effective January 1, 2025): Renews a minimum fee schedule for non-public and county nursing facility services for the rating period covering January 1, 2025 through December 31, 2025, incorporated in the capitation rates through a risk-based rate adjustment.
- Pennsylvania (Effective January 1, 2025): Renews a value-based purchasing established by the state for eligible nursing facility services for the rating period, January 1, 2025 through December 31, 2025, incorporated into the capitation rates through a separate payment term.
- Pennsylvania (Effective January 1, 2026): Renews a uniform percentage increase payment arrangement for professional services at an academic medical center for rating periods covering January 1, 2026, through December 31, 2026, incorporated in the capitation rates through a separate payment term.
