Health and Human Services Secretary Kennedy announced the agency’s voluntary “Make Hospital Food Healthier Pledge” last week, encouraging hospitals to serve healthier food to patients. Hospitals that take up the pledge would make commitments to eliminate deep-fried foods, limit sugar-sweetened beverages and added sugar in meals, emphasize whole grains, and limit ultra-processed foods among other promises. According to HHS, following the pledge and aligning their food service practices with the Dietary Guidelines for Americans will help hospitals improve patient outcomes, reduce complications, and encourage healthy communities. HHS has not yet named any organizations that have signed the pledge (Fierce Healthcare, July 9; HHS, n.d.).
On July 9, HHS announced that, through the Advanced Research Projects Agency for Health (ARPA-H), it will award $160M to seven teams at hospitals and research institutions conducting therapy research for metabolic, blood, immune, bone marrow, childhood epilepsy, heart and skin issue related diseases. The project is known as Treating Hereditary Rare Diseases with In Vivo Precision Genetic Medicines, or THRIVE, and will be led by Children’s Hospital of Philadelphia, UC Berkeley, St. Jude Children’s Research Hospital, Broad Institute, Massachusetts General Hospital, Stanford University, GEMMABio and Profluent Bio (Inside Health Policy, July 10).
On July 14, 2026, CMS issued an informational bulletin directing states to redetermine Medicaid and Children’s Health Insurance Program eligibility for beneficiaries affected by the Department of Homeland Security’s termination of parole programs for Cubans, Haitians, Nicaraguans, and Venezuelans, as well as other case-by-case parole terminations. States must identify affected beneficiaries, reverify their current immigration status or category through the Systematic Alien Verification for Entitlements program, and determine whether they qualify under another eligible status or category before reducing or terminating coverage. Prior verification responses are not automatically updated when an individual’s status changes, so states must submit new verification requests and are encouraged to regularly use the Department of Homeland Security’s Status Change Report to identify certain affected beneficiaries. States must consider all other bases of eligibility, including emergency Medicaid, and provide advance notice and appeal rights before taking adverse action. The bulletin also addresses the effect of losing satisfactory immigration status on continuous eligibility and postpartum coverage periods and notes that separate statutory changes taking effect October 1, 2026, will affect federal payment for full Medicaid and CHIP benefits for certain noncitizens (CMS, July 14).
CMS proposed reforms to Medicare’s physician payment and value-based care programs aimed at expanding accountable care organizations, modernizing physician payment, reducing administrative burden, and shifting the program’s focus toward preventive care. For accountable care organizations, the proposal would increase financial incentives for new and existing participants, establish more predictable spending benchmarks, simplify reporting and technology requirements, and beginning April 1, 2027, allow certain organizations to reduce or eliminate beneficiary cost sharing for select services. These changes build on the program’s recent performance, as 75% of the 476 participating accountable care organizations earned $4.1B in shared savings in 2024 while generating approximately $2.5B in net Medicare Trust Fund savings.
The proposal would also update the Physician Fee Schedule to better align payments with the complexity and resources required to deliver care, account for efficiencies when multiple services are provided during the same encounter, increase payment transparency, and strengthen oversight of billing practices. As part of the same shift toward value-based care, traditional Merit-based Incentive Payment System reporting would end after the 2028 performance year, with clinicians transitioning to specialty-focused MIPS Value Pathways beginning in 2029. CMS also proposed new pathways for diabetes, hypertension, and hospital-based care, specialty-specific core measures beginning in 2027, and revisions to Alternative Payment Model incentive payments intended to prevent an estimated $2.38B in windfall payments over the next decade. Stakeholders may submit comments on the proposed changes before CMS finalizes the rule (CMS, July 14).
CMS released preliminary results for the ACO REACH model’s program year 2024 (PY2024). The agency found that the demonstration, which is set to expire at the end of this year, improved quality, decreased utilization, and decreased spending among the Original Medicare population. The model served more than 2.5M Medicare beneficiaries in PY2024 through 115 ACOs. In PY2024, ACO REACH saw gross spending decline by 2.2%, or $706.1M, across all three types of ACOs: Standard, High Needs, and New Entrant ACOs. After accounting for financial incentives and payments to ACOs, net spending increased by 0.2%, or $55.3M, in PY2024. All three ACO types improved quality and utilization measures in PY2024, reducing hospitalizations and increasing timely follow-up after acute flareups of chronic conditions. Of the 115 ACOs participating in ACO REACH only 19, or 17%, saw net losses, with the remaining 96, or 83% of ACOs generating savings. With ACO REACH ending its ten-year demonstration period on December 31, the CMS Innovation Center will transition to a new model, the Long-Term Enhanced ACO Design (LEAD), on January 1, 2027. The agency plans to build upon ACO REACH and incentivize a broader mix of healthcare providers to participate in accountable care arrangements through LEAD (Fierce Healthcare, July 10; CMS Innovation Center, n.d.).
ACA marketplace premiums could increase sharply again in 2027, with insurers requesting a median rate increase of 14% across preliminary filings reviewed in 16 states and Washington, D.C. Most proposed increases fall between 10% and 20%, while 20 insurers are seeking increases above 20% and none have proposed lowering premiums. The 2027 median request is the second-highest since 2018, following an 18% median proposed increase for 2026 that ultimately resulted in a 20% finalized increase. Insurers attributed the requests to a less healthy enrollment pool following the expiration of enhanced premium tax credits, continued growth in hospital, physician, prescription drug, and labor costs, including spending on GLP-1 medications, and uncertainty tied to recent federal marketplace changes. CMS also recently finalized a rule expanding access to lower-cost plans and strengthening eligibility verification requirements, but the rule was issued after some insurers had already developed their proposed rates. Insurers have until July 15 to submit their 2027 rate filings. If approved, the increases would bring typical marketplace premium growth since 2025 to more than 33% (Healthcare Dive, July 8).
HHS has postponed the final HIPAA Security Rule update from May 2026 to July 2027, delaying what would be the first major revision to the rule in more than a decade. The proposal would apply to providers, health plans, and business associates and would require safeguards such as encryption, multifactor authentication, network segmentation, annual penetration testing, more detailed risk assessments, and regularly tested incident response plans. The delay follows substantial industry opposition, with nearly 5,000 comments submitted and more than 100 healthcare organizations urging HHS to withdraw the proposal because of its cost and implementation demands. A separate update to the HIPAA Privacy Rule remains on track for release in August and is expected to focus on patient access, information sharing, care coordination, and reducing administrative burden (Fierce Healthcare, July 10).
Arkansas’ Department of Human Services confirmed that Centene will not participate in ARHOME, the state’s Medicaid expansion program, starting in 2027. Currently, Centene operates three out of the six health plans that provide coverage to expansion enrollees, covering about one-third of the 211,000 ARHOME participants. The remaining three plans are operated by BlueCross Blue Shield. Centene’s enrollees will be transferred to other plans (Arkansas Advocate, July 6).
On July 13, Missouri Governor Mike Kehoe signed House Bill 2372 into law, a wide-ranging bill that aims to improve healthcare access and affordability, including many policies targeting maternal and reproductive health. The legislation will expand the state’s doula services under Medicaid, covering 16 visits throughout pregnancy, birth, and postpartum. Previously, coverage was restricted to six visits. Medicaid beneficiaries under the Show Me Healthy Babies program will also be able to access free childbirth education classes. Individuals with private insurance will be able to receive an annual supply of contraceptives starting January 1. Additionally, private insurers will be required to cover blood pressure monitoring equipment for pregnant and postpartum individuals.
Finally, the law will broaden the scope of Missouri’s Pregnancy-Associated Mortality Review Board to include tracking the level of prenatal and postnatal care received by those who died during birth or postpartum, studying the state’s maternal healthcare deserts, and making recommendations to address the racial inequities in maternal mortality. According to Governor Kehoe, HB 2372 is a key aspect of the state’s Rural Health Transformation Program (Missouri Independent, July 13).
On July 2, Wellpoint announced its exit from D.C.’s managed care program, effective August 1. The decision follows discussions with D.C.’s Department of Health Care Finance, and the payer will collaborate with providers and community organizations to support a smooth transition and continuity of care. Current enrollees will automatically be assigned to AmeriHealth Caritas DC. Individuals who are unhappy with the auto enrollment will have until January 31, 2027, to select MedStar Family Choice (Becker’s Payer Issues, July 9).
New York wants to use approximately $2.1B in remaining federal waiver funds to keep its Medicaid health-related social needs program operating through April 2028, followed by a transition to monthly managed care payments. The broader five-year extension would preserve services addressing food insecurity, housing instability, and other non-medical needs without requesting additional federal funding. Since the initiative launched in January 2025, about 1.3 million Medicaid enrollees have been screened, with roughly half reporting at least one unmet need, and nutrition services accounting for about 70% of program spending.
To support its request, New York pointed to a similar North Carolina initiative that reduced Medicaid spending by $164 per enrollee per month and argued that additional time is needed to demonstrate improvements in health outcomes and cost savings. Federal approval may be difficult given the Trump administration’s more restrictive approach to Medicaid funding for non-medical services, and the state is not seeking to continue a separate $692M workforce initiative that CMS has indicated would not be approved. Public comments are due August 21, and New York plans to submit its final application by September 30, ahead of the current waiver’s March 31, 2027, expiration (Politico, July 13; Politico, July 8).
