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House Passes Budget Framework; Healthcare Cuts Heat Up

The House adopted a budget reconciliation bill today with just one GOP defection. House Speaker Mike Johnson and President Donald Trump got three other doubters to convert to “yes.” The vote was 217 to 215. The bill paves the way for final passage down the road but a great deal of work has to occur, with committees now meeting on spending cut targets. This includes $880 billion in healthcare spending cut targets. Johnson and perhaps Trump convinced holdouts that Medicaid rolls will not be cut except for work requirements and if someone is illegally on the program. It may be hard to keep the commitment with a large reduction bogey. The victory was major for Johnson but he now needs to hold all these folks in place as spending cuts are debated in committees.

Meanwhile, healthcare news is heating up due to the possible spending cuts:

  • The Blue Cross and Blue Shield Association (BSCSA) issued a report today that has $1 trillion in healthcare cost reductions over a decade — federal savings of $524 billion, lower private insurance premiums of $389 billion, patient savings of $180 billion. The largest potential area for savings is to adopt site-neutral payments in Medicare, which would save $484 billion over 10 years. I will do a blog on the report next week.
  • A Modern Healthcare article explains work requirements and their history in Medicaid.
  • The Health and Human Services (HHS) Office of Inspector General (OIG) said that Medicare costs of ten common diabetes medications, including GLP-1s, went up by 364% between 2019 and 2023. In 2019, Medicare spent roughly $7.7 billion. In 2023, the cost reached $35.8 billion.
  • Trump plans to sign an executive order to reinforce rules to make healthcare prices more transparent for patients. The order will update agency enforcement policies to make sure healthcare providers and insurers are complying with the rules.
  • Insurers overall had a poor 2024 due to various issues, including poor Medicare Advantage (MA) rates. There were a few exceptions.
  • A Kaiser Family Foundation (KFF) poll finds that Medicaid is viewed favorably by a large majority (77%) of the public and an even larger share of those on the program (84%). Another poll from Hart Research conducted for the nonprofit Families Over Billionaires finds that 71% percent of voters who backed Trump said cutting Medicaid would be unacceptable. 
  • A compound pharmacy trade group has filed a lawsuit against the Food and Drug Administration (FDA) for removing semaglutide, the active ingredient in Ozempic, from its drug shortage list. Many Americans use these generic compounds for weight loss due to the $1,000 plus cost of brands. Still, the generic drug costs can be $200 plus a month.

Additional articles: https://www.fiercehealthcare.com/regulatory/bcbsa-report-addressing-hospital-pharma-costs-could-save-1t-over-next-decade and https://www.modernhealthcare.com/policy/medicaid-work-requirements-gop-budget and https://www.beckerspayer.com/payer/medicare-part-d-spending-on-weight-loss-drugs-surges-364-oig.html and https://www.modernhealthcare.com/policy/trump-healthcare-cost-transparency and https://www.healthcaredive.com/news/health-insurer-medical-costs-climbing-ma-medicaid/740611/ and https://www.kff.org/medicaid/report/the-debate-over-federal-medicaid-cuts-perspectives-of-medicaid-enrollees-who-voted-for-president-trump-and-vice-president-harris/ and https://thehill.com/policy/healthcare/5161953-obamacare-medicare-budget-entanglement/ and https://thehill.com/homenews/house/5163381-democrats-medicaid-gop-budget/ and https://thehill.com/policy/healthcare/5163193-trump-voters-oppose-medicaid-cuts-poll/\ and https://thehill.com/policy/healthcare/5163570-weight-loss-drugs-fda-shortage-list-ozempic-wegovy/

(Some articles may require a subscription.)

#healthcare #trump #congress #budgetreconciliation #medicare #medicaid #coverage #siteneutral #glp1s #weightlossdrugs #drugpricing #branddrugmakers #healthplans #hospitals #pricetransparency

https://www.cbsnews.com/news/budget-resolution-house-vote-mike-johnson-trump-agenda

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More Surprises From Trump On Drug Pricing

Donald Trump’s Centers for Medicare and Medicaid Services (CMS) in late January said it would continue Medicare drug price negotiations. Then, in a Super Bowl interview, Trump bemoaned the cost of GLP-1 weight-loss drugs in America compared with other developed nations. Now, the Trump administration has chosen to defend the Medicare drug price reform law in court.

In a filing Feb. 19, the government agreed with the legal arguments used by the Biden administration and by a lower court.

Trump so far is not what Big Pharma hoped.

#ira #medicare #partd #drugpricing #branddrugmakers

https://www.fiercehealthcare.com/payers/trump-admin-defends-ira-drug-price-negotiation-program-novartis-lawsuit

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Centene and Molina Could Be Hurt By Medicaid Cuts

Medicaid managed care-dominant insurers Centene and Molina could be hurt by Republicans’ plans for cuts to Medicaid. The House GOP has a target of $800 billion in healthcare spending reductions. While President Trump and GOP leaders have promised no dramatic changes to Medicaid, the targets would clearly mean deep reductions. While work requirements and fraud cuts are certain, other impacts could be reimbursement changes at the state level.

Centene is the largest Medicaid managed care insurer with 13 million Medicaid beneficiaries as of Dec. 31. The membership generates 62% of the company’s revenue. Medicaid represents 88% of Molina’s membership and nearly 80% of its revenue for 2024.

(Article may require a subscription.)

#medicaid #managedcare #budgetreconciliation #trump #congress #molina #centene

https://www.modernhealthcare.com/insurance/medicaid-cuts-centene-molina-healthcare

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Trump Limits Public Benefits To Undocumented

President Donald Trump issued an executive order that limits public benefits for undocumented immigrants. It directs each federal agency to identify programs that currently allow undocumented immigrants to receive federal benefits and to comply with the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, which generally prohibits such benefits. The order also mandates the enhancement of eligibility verification systems. It also seeks to limit or bar funding state and local programs that either subsidize illegal immigration or support sanctuary policies.

Fourteen states plus D.C. provide state-funded healthcare coverage to children regardless of immigration status. California is the first state to offer Medicaid coverage to all eligible undocumented individuals.

#trump #immigration #healthcare

https://www.beckershospitalreview.com/legal-regulatory-issues/trump-signs-executive-order-to-end-federal-benefits-for-undocumented-immigrants.html

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Trump Endorses House GOP One-Bill Approach

President Donald Trump came out today in favor of the House GOP’s one-bill approach, surprising the Senate which felt he was taking a wait-and-see, go-slow approach on the issue. The one bill approach has steep spending reduction targets in it. Still, the fate of the House bill is uncertain. Speaker Mike Johnson can afford to lose no more than one vote on the reconciliation bill. Several moderates have expressed concerns on healthcare cuts. Some conservatives are complaining cuts are not deep enough.

While leaders claim healthcare cuts to Medicaid and the Affordable Care Act (ACA) will not disrupt coverage, the savings targets could make that promise difficult to keep. Some conservatives are arguing that reductions in state reimbursement or even how much the federal government contributes should occur, which undoubtedly would impact coverage. Reining in provider taxes could also impact state financing schemes and require them to cover funding with more state budget dollars.

Additional articles: https://www.modernhealthcare.com/providers/medicaid-cuts-home-care-kff and https://insidehealthpolicy.com/daily-news/senate-democrats-blast-trump-endorsing-house-budget-plan-continue-warning-medicaid-cuts and https://kffhealthnews.org/news/article/republicans-medicaid-cuts-congress-state-federal-budgets-insurance-explainer/ and https://thehill.com/homenews/house/5154428-moderate-republicans-oppose-house-budget-resolution/ and https://thehill.com/homenews/senate/5153342-senate-gop-leader-reacts-trump-budget/?tbref=hp and https://www.medpagetoday.com/publichealthpolicy/medicaid/114286 and https://thehill.com/homenews/5153990-house-republicans-budget-resolution-trump-agenda/?tbref=hp

(Some articles may require a subscription.)

#budgetreconciliation #congress #trump #healthcare #coverage #spending

https://www.fiercehealthcare.com/regulatory/medicaid-faces-severe-cuts-new-budget-framework

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Worried About House Vote, Senate Takes Different Path on Budget Reconciliation

On a 50-47 vote, the Senate GOP officially started the process of passing a budget reconciliation bill in a bid to enact a portion of President Trump’s agenda. 

The Senate is taking a two-bill approach to meet President Trump’s objectives, while the House is moving on one big bill. The Senate fears House Speaker Mike Johnson will not have enough votes on his plan because conservatives are demanding deep cuts and others want more moderate ones.

The Senate’s first bill would spend $325 billion to bolster border operations and allow Trump’s deportation plans to be executed as well as boost defense spending and greenlight Trump’s energy plans. The Senate Republicans are planning to use a second reconciliation bill to extend Trump’s 2017 tax cuts. The second bill would include offsetting spending cuts.

#budgetreconciliation #trump #congress #healthcare

https://thehill.com/homenews/senate/5152221-senate-gop-budget-resolution/?tbref=hp

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Study Shows How Obesity Impacts Employer Healthcare Costs

UnitedHealthcare and the Health Action Council have examined how the obesity epidemic has impacted the healthcare costs of employers and how it will continue to do so in the future.

About 75% of adults in the U.S. are either overweight or obese, up from 50% in 1990. Obesity rates have grown fastest among younger adults. The obese population accounts for 46% of the employers’ medical spend. Per member per month costs for obese employees are more than double ($973) than those who were not obese ($421).

Metabolic conditions are common among people with obesity. For workers in their ’50s, diabetes rates are 2.5 times higher among obese individuals. Hypertension rates were three times higher. Those who were obese also had greater rates of behavioral health illnesses.

Study: https://healthactioncouncil.org/media/i5qj3qah/2025-hac-white-paper.pdf

#obesity #glp1s #weightlossdrugs #healthcare #chronicconditions #employercoverage

https://www.fiercehealthcare.com/payers/unitedhealth-hac-study-examines-how-obesity-impacting-employer-health-costs

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Major Staff Cutbacks In Healthcare At Federal Government

The Trump administration has directed agencies to begin laying off probationary employees. The Department of Health and Human Services (HHS) and related agencies are firing up to 5,200 probationary employees as of today. About 1,300 are employed by the Centers for Disease Control and Prevention (CDC) and a sizeable number are with the National Institutes of Health (NIH). There are over 2 million federal employees.

Additional article: https://www.modernhealthcare.com/labor/cdc-layoffs-cuts-trump

(Some articles may require a subscription.)

#hhs #nih #cdc #staffing #layoffs #trump #doge

https://www.fiercehealthcare.com/regulatory/mass-layoffs-hhs-cdc-cuts-1300-probationary-workers-reports-say

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RFK, Jr. Confirmed As Health Chief; Will Chair MAHA Commission

President Donald Trump’s nominee as secretary of Health and Human Services (HHS), Robert F. Kenndy, Jr., was confirmed by the Senate today on a 52-48 vote, with Mitch McConnell being the only GOP senator to not vote yes. All Democrats opposed Kennedy.

Trump also signed a new executive order to establish a Make America Healthy Again (MAHA) Commission. Kennedy will chair the task force, focused on investigating the “root causes of America’s escalating health crisis.” The commission first will address childhood chronic diseases.

In other news, HHS assistant secretaries were also named by Trump. One of them is an anti-trust lawyer with deep background in healthcare mergers.  This could be a clue that the Biden administration’s healthcare anti-trust agenda may not totally go away.

Additional articles: https://www.fiercehealthcare.com/regulatory/trump-creates-maha-commission-chronic-disease-chaired-rfk and https://insidehealthpolicy.com/daily-news/newly-confirmed-hhs-sec-rfk-jr-lead-maha-commission and https://www.modernhealthcare.com/politics-policy/rfk-jr-full-senate-vote-hhs and https://www.healthcaredive.com/news/rfk-jr-confirmed-hhs-secretary-robert-f-kennedy-jr/740054/ and https://insidehealthpolicy.com/daily-news/trump-nominates-two-hhs-asst-secretaries-general-counsel

(Some articles may require a subscription.)

#rfkjr #healthcare #hhs #maha

https://www.fiercehealthcare.com/regulatory/senate-confirms-rfk-jr-head-hhs-52-48-vote

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Healthcare Segments’ Top Priorities

A good article in Fierce Healthcare on the priorities of the various healthcare segments for 2025. Here are the highlights and there will be some battles between the parties.

Hospitals – extending Exchange premium subsidy enhancements, further health plan prior authorization (PA) and utilization management limits, fighting coverage reductions, and maintaining the 340b program substantially as is.

Plans – relief on Medicare Advantage (MA), and PBM reform (most health plans support except those with sister company PBMs).

Providers – a Medicare rate fix, reducing administrative burden, and workforce reform.

Also on the agenda is extending telehealth flexibilities and the hospital-at-home program.

#healthcare #healthplans #hospitals #providers #medicare #exchanges #medicaid

https://www.fiercehealthcare.com/regulatory/healthcare-lobbying-2025-here-are-top-policy-issues-hospitals-payers-docs-and-tech

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