News Briefs: Dr. Oz describes changes he would bring to Medicaid, Medicare Advantage

During his Senate confirmation hearing for the post of CMS administrator, Mehmet Oz, MD, was not asked about his past endorsement of a Medicare Advantage (MA) for All model, in which MA would expand to cover most Americans.

He did sound willing to take action against MA insurers that allegedly overcharge the government through methods such as upcoding.

“It’s something that is addressable,” Oz testified to the Senate Finance Committee on March 14. “I pledge if [I’m] confirmed, now we’ll go after it.”

Several Democrats pressed Oz about what he would do to ensure the viability of Medicaid in the wake of what could be substantial cuts stemming from the ongoing FY25 budget reconciliation process. Republicans in the House and Senate are working on a final package.

Oz said streamlining Medicaid may benefit the core populations traditionally served by the program. He favors work requirements, but he said, “I don’t think you need to use paperwork to [fulfill the] work requirement, and I don’t think that should be used as an obstacle, a disingenuous effort to block people from getting on Medicaid.”

On March 25, the Finance Committee voted 14-13 along party lines to send Oz’s nomination to the full Senate.

Going their own way: Numerous hospitals opt out of Blues settlement

Several large health systems and dozens of other hospitals and healthcare providers are pursuing antitrust litigation against Blue Cross Blue Shield (BCBS) after opting out of a record-setting settlement.

Lawsuits are known to have been filed against the insurer in California, Illinois and Pennsylvania federal court since March 4, the deadline for hospitals to opt out of the $2.8 billion settlement, which culminated litigation that stretched back to 2012 and is said to be the largest healthcare settlement ever for a U.S. private antitrust case.

A clause allows BCBS to terminate the settlement if opt-outs exceed a certain number. But Whatley Kallas, the lead firm representing the plaintiffs in the class action, said the terms are unchanged. Hospitals that have done business with the Blues since 2008 are part of the settlement unless they opted out.

The $2.8 billion fund is set to be reduced by at least $800 million as allocated for attorney fees and expenses and administrative expenses. Of the net amount, 92% is apportioned for hospitals and facilities and 8% for medical providers.

ACA marketplace enrollment likely to decrease under proposed regulations

The Trump administration’s first regulations on the Affordable Care Act (ACA) health insurance marketplaces are projected to reduce enrollment.

Published on March 19, a proposed rule would end open enrollment at healthcare.gov and in state-based exchanges on Dec. 15, a month earlier than in recent years, leaving a 45-day window in which to enroll.

Another aspect would eliminate the monthly special enrollment period for individuals whose household income is below 150% of federal poverty. While much of the rule would take effect in 2026, that policy would begin with the effective date of the final rule (generally 60 days after publication).

Implementing the rule’s various provisions would reduce improper federal spending on advance subsidy payments by at least $11 billion in 2027, CMS said. However, the agency also foresees a reduction in annual enrollment of between 750,000 and
2 million.

In other ACA marketplace news, CMS in February announced it would trim funding for the ACA navigator program by roughly 90%, to $10 million, for 2026. Navigators help prospective enrollees understand their options and enroll in coverage.

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Denial rates for leading ACA marketplace insurers

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Medicaid DSH payment cut again delayed in the final FY25 CR, while physicians express dismay

Hospitals that receive Medicaid disproportionate share hospital (DSH) payments got continued relief from a pending big cut as Congress passed a continuing resolution (CR) to fund the federal government for the remainder of FY25.

The bill, which passed the House on March 11 and the Senate three days later, ensures the three-year, $24 billion cut will not take effect before Oct. 1. Prior to passage of the CR, the cut was slated to begin April 1.

Medicare extenders in the CR include supplementary payments for designated low-volume hospitals and Medicare-dependent hospitals. Authorization for expanded Medicare coverage of telehealth and acute hospital care at home would continue through September, maintaining waivers that have been in place since the pandemic.

Physicians had been hoping their 2.83% Medicare payment cut for 2025 would be lessened in the CR, but no such measure was included.

“Physicians across the country are outraged that Congress’s proposed spending package locks in a devastating fifth consecutive year of Medicare cuts,” Bruce Scott, MD, president of the American Medical Association, said in a written statement.

Price transparency enforcement gets a boost as Trump signs executive order

Hospitals can expect stepped-up enforcement of price transparency rules now that President Donald Trump has signed an executive order (EO) on the topic.

In his Feb. 25 order, Trump noted that his first administration drafted the two sets of regulations requiring providers and insurers to make prices available to healthcare purchasers.

He thinks the Biden administration put insufficient emphasis on the regulations after starting to implement them in 2021, even though enforcement increased in recent years and the templates for hospitals to use in publishing their machine-readable files became more precise.

Within 90 days of the EO, HHS and the Departments of Labor and Treasury are supposed to take steps that include requiring disclosure of actual prices, rather than estimates, and ensuring that price information is better standardized across hospitals and health plans.

The requirement to post actual prices may cause a stir among hospitals, in part because of the time and resources that were required to meet a Jan. 1, 2025, deadline to post estimated allowed amounts.

To date, 24 hospitals have been penalized for noncompliance.

Injunction granted on policy that would hamper funding for teaching hospitals

A federal judge has extended a block on a Trump administration policy that would cap reimbursement for indirect medical research costs at institutions such as teaching hospitals.

Per the Feb. 7 policy issued by the National Institutes of Health, add-on payments as part of research grants would be limited to a 15% rate instead of being negotiated.

The Association of American Medical Colleges, which challenged the policy in federal court, said the change would reduce previously committed funding by $6.5 billion.

The policy was stayed before it could take effect Feb. 10, with a second stay issued Feb. 21. On March 5, the temporary stay was expanded to a full injunction that is set to last until the litigation is resolved.