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HHS And Related Health Agencies Will Downsize By 20,000

The Department of Health and Human Services (HHS) will slash an additional 10,000 full-time jobs after laying off or “buying out” about the same number already. Prior to the moves, the agencies collectively had 82,000, so the workforce will be downsized by about 25%. These cuts are in line with the Department of Government Efficiency (DOGE) commission’s workforce optimization efforts and are slated to save the agencies $1.8 billion per year.

HHS is also reorganizing and will cut the department from 28 divisions to 15 and close five regional offices.

Job reductions include:

• 3,500 at the Food and Drug Administration (FDA).
• 2,400 at the Centers for Disease Control and Prevention (CDC).
• 1,200 at the National Institutes of Health (NIH).
• 300 at the Centers for Medicare and Medicaid Services (CMS).

Additional articles: https://www.fiercehealthcare.com/regulatory/rfk-jr-prepares-10000-job-cuts-across-hhs-new-wave-worker-reductions and https://insidehealthpolicy.com/daily-news/hhs-major-new-reorg-includes-agency-mergers-10k-more-job-cuts and https://www.healthcareitnews.com/news/hhs-reduce-workforce-20k-jobs-major-agency-wide-restructure and https://thehill.com/policy/healthcare/5218547-trump-administration-plans-hhs-cuts/ and https://www.medpagetoday.com/washington-watch/washington-watch/114854 and https://www.modernhealthcare.com/labor/hhs-cuts-rfk-jr

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#congress #trump #doge #budgetreconciliation #healthcare #hhs #cms #fda #cdc #nih

https://www.healthcaredive.com/news/hhs-job-cuts-reorganization-rfk-trump/743569

Medicare Advantage Deductibles Surged in 2025

A survey by online broker eHealth finds that the average deductible for a Medicare Advantage (MA) plan in 2025 more than doubled to $315. The average deductible for MA plans during the enrollment period was $315, compared to $132 in 2024, or an increase of 139%. Premiums decreased from $9 per month to $5 per month, but MA plans clearly had to save by increasing deductibles and cost-sharing as well as reducing benefits and footprints.

In other news, Becker’s also reports on the fastest-growing non-profit Blue Cross and Blue Shield plans in terms of MA enrollment. Chartis says Blue Cross Blue Shield non-profit plans accounted for around 30% of MA enrollment growth in 2025. That number does not include for-profit Elevance Health, one of the big national plans which is also a Blues licensee.

Big BCBS plan gainers were BCBSMI, Highmark, and Horizon. Chartis also says that 45% of all enrollment growth in 2025 accrued to BCBS non-profits and other non-profits. BCBS plans added 400,000 MA members for 2025.

Check out the Chartis report here – rich in content: https://www.chartis.com/insights/medicare-advantage-market-growth-slows-amid-intensified-headwinds

Additional article: https://www.beckerspayer.com/payer/the-fastest-growing-bcbs-medicare-advantage-plans-2025/

#medicareadvantage #coverage #cms

https://www.beckerspayer.com/payer/medicare-advantage-deductibles-more-than-double-survey/

Hard-Hitting Study Could Drive Medicaid Budget Cuts

A study by the Paragon Health Institute and the Economic Policy Innovation Center could help drive certain cuts adopted by Republicans during the budget reconciliation process. The study focuses in on California and various ways the authors say the Golden State effectively exploits matching rules and launders money to fund its state share at the expense of the federal Medicaid budget. It also indicates that the schemes provide dollars to cover undocumented immigrants, even though federal law bars enrollment in Medicaid.

The GOP in Congress is known to want to stay away from explicit coverage reductions in Medicaid. But it is looking at reining in the amount states are demanding in match as well as eliminating or at least reducing the use of provider taxes for state match.

Study: https://paragoninstitute.org/wp-content/uploads/2025/03/California-Money-Laundering-Scheme_FOR-RELEASE_V3.pdf

#medicaid #healthcare #coverage #budgetreconciliation

https://thefederalist.com/2025/03/24/red-states-are-paying-for-californias-illegal-aliens-health-care

Trump Aligned Think Tank Wants Drug Price Reductions

America First Policy Institute (AFPI), a conservative think tank friendly with Donald Trump, says the administration should bring back Trump 45’s international reference pricing policy for drugs across federal health programs and in the commercial market. So far, the Trump administration has firmly backed the Medicare drug price law.

The think tank says there are many ways the pricing could be implemented, including via the drug law. The push for commercial application is watershed. AFPI also recommends the Trump administration restrict drug makers’ ability to charge lower prices internationally than in America and use its trade negotiation power to press countries to stop using so-called “freeloading” policies.

(Article may require a subscription.)

#drugpricing #trump #ira #branddrugmakers

https://insidehealthpolicy.com/inside-drug-pricing-daily-news/trump-aligned-think-tank-calls-admin-bring-back-mfn-policy

Former Rep. Burgess Leading Contender For CDC Chief

Former Representative Michael Burgess, M.D., R-TX, is a top choice for Centers for Disease Control and Prevention (CDC) director. Former Rep. Dave Weldon’s nomination was pulled over vaccine skepticism.

Burgess, 74, practiced obstetrics and gynecology before going to Congress in 2003. He chose not to seek re-election in 2024. He is known as a major health policy wonk, supported COVID vaccination, and was an advocate for providers. At the same time, he is a conservative and not in favor of major expansion of government programs. He led the House’s Energy and Commerce Subcommittee on Health. He also headed the GOP Doctor’s Caucus.

Another name that has been floated is Florida Surgeon General Joseph Ladapo, M.D., who is an ardent vaccine skeptic and would be extremely controversial.

#cdc #trump #congress #nominations 

https://www.fiercehealthcare.com/regulatory/former-rep-michael-burgess-md-likely-next-cdc-director-nomination-report

OptumRx Rolls Out Transparent Reimbursement

OptumRx says it is rolling out a new cost-based reimbursement model for pharmacies. It says it expects the change to be a positive one for the more than 24,000 independent and community pharmacies as well as members. Optum said it will begin to roll out the updated models now and intends to have a full implementation in place by January 2028. 

The model will reimburse pharmacies more for dispensing brand-name medicines to address longstanding complaints that expensive prescriptions are losing money for drugstores. The model recognizes that with the penetration of generics, some work must be done to deal with the brand reimbursement problem. This will help stocking of brand drugs.

Pharmacists are skeptical and feel this is an effort to forestall passage of pharmacy benefits manager (PBM) reform.

Additional articles: https://www.modernhealthcare.com/insurance/unitedhealth-optumrx-brand-name-drugs and https://insidehealthpolicy.com/inside-drug-pricing-daily-news/new-optum-rx-pharmacy-pay-model-met-skepticism

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#drugpricing #pbms

https://www.fiercehealthcare.com/payers/optum-rx-overhaul-pharmacy-reimbursement-models

Cigna Closes $3.3 Billion Deal To Sell MA Business

Cigna officially closed its $3.3 billion sale of its Medicare line of business to Health Care Service Corporation (HCSC). The deal includes Medicare Advantage (MA) lives, Medicare Part D lives, its Medicare supplement business, and its CareAllies physician ownership. HCSC jumps to 950,000 members from about 240,000 members. Cigna actually grew MA from about 600,000 to 700,000 in the past year. Cigna CEO David Cordani was known to be frustrated with the lack of profitability in the MA line and wants to focus on services entity Evernorth and the commercial insurance line.

In other news, United’s Optum Rx pharmacy benefits manager (PBM) said it would eliminate up to 25% of reauthorizations, initially focusing on 80 drugs. This amounts to 10% of overall prior authorizations.

Additional articles: https://www.fiercehealthcare.com/payers/cigna-closes-33b-sale-medicare-plans-hcsc and https://www.beckerspayer.com/m-and-a/cigna-hcsc-close-3-3b-medicare-advantage-sale/ and https://www.fiercehealthcare.com/payers/optum-rx-reduce-reauthorizations-80-drugs and https://www.modernhealthcare.com/insurance/optumrx-drug-prior-authorization and https://www.healthcaredive.com/news/optum-rx-eliminate-prior-authorizations/742910/ and https://www.beckerspayer.com/payer/optum-rx-to-eliminate-prior-authorization-for-80-drugs/

(Some articles may require a subscription.)

#cigna #medicareadvantage #hcsc #unitedhealthcare #pbms #priorauthorization

https://www.modernhealthcare.com/mergers-acquisitions/cigna-hcsc-medicare-sale-closed

Trump Administration Sides With Hospitals Over Drug Makers in 340B Lawsuit

The Department of Health and Human Services (HHS) has filed for summary judgment in its favor regarding lawsuits on the 340B program, siding with hospitals over drug makers. This is consistent with the Biden administration. While I am not a fan of brand drug makers, it is clear that hospitals and some other providers are abusing the intent of the program. Trump is on the wrong side of this policy issue.

#340b #drugpricing #branddrugmakers

https://www.fiercehealthcare.com/ai-and-machine-learning/rfk-jrs-hhs-picks-biden-admins-legal-fight-against-340b-rebates

Major Medicare Advantage Advocacy Group Launches Ad Campaign

Better Medical Alliance (BMA), a prominent Medicare Advantage (MA) advocacy group, has launched a seven-figure digital ad campaign in an effort to avoid MA cuts and boost the proposed 2026 rate increase. Not counting risk score trends, MA rates saw a decline in 2024 and 2025. The Biden administration proposed just a 2.3% hike for 2026. This would lead to a third year of benefit cutbacks and geographic footprint reductions. The reductions have been caused by a new risk model that takes about 7% out of rates overall (it is being phased in over three years through 2026) as well as reductions in medical education funding.

BMA notes that both Milliman and PwC estimated medical cost trends in MA increased by 8% from 2023 to 2024. The trend continues into 2025 with the return of utilization. Plans are also facing higher costs in Medicare Part D due to the Biden administration’s and Democrats’ misguided and unfunded reduction in out-of-pocket costs in the Inflation Reduction Act (IRA).

The final rate hike is now at the Office of Management Budget (OMB) for approval and should be released publicly by April 7. MA plans are hopeful that rates are increased despite the spending cut push. This could come in a few ways: an increase in the cost trend, pushing out the final year of the risk model phase-in, and forestalling the phase-in of medical education funding reductions.

The ad campaign could also influence the potential reductions to MA in a budget reconciliation bill. Pressure is mounting to curb overpayments and reform risk adjustment in the program. This is due to commitments to avoid major Medicaid coverage reducions and the sheer size of spending cut targets. I feel like carefully phased-in and targeted risk adjustment reforms are not unreasonable, but also think rate relief is needed in 2026.

Additional articles: https://bettermedicarealliance.org/news/better-medicare-alliance-launches-new-ad-urging-trump-administration-to-protect-medicare-advantage-for-seniors/ and https://insidehealthpolicy.com/daily-news/ma-allies-launch-ad-campaign-cy-2026-ma-rate-notice-hits-omb

(Some articles may require a subscription.)

#medicareadvantage #overpayments #riskadjustment #rates

https://www.modernhealthcare.com/medicare/better-medicare-alliance-ads-medicare-advantage

Oz Dodges Medicaid Cuts But Signals Openness On MA Reductions

Dr. Mehmet Oz, nominee to be administrator of the Centers for Medicare and Medicaid Services (CMS), seems well placed to be confirmed. In a hearing, he dodged most questions on Medicaid cuts but signaled that he might favor reductions to Medicare Advantage (MA) overpayments. I have been saying this for some time now.

Oz said he is in favor of work requirements for Medicaid and removing undocumented individuals. He did not defend the Affordable Care Act (ACA) enhanced premium tax credits set to expire in 2025.

Oz appeared to agree with Sen. Elizabeth Warren, D-MA, and others at several points in the hearing that the MA program needs better reform and oversight, especially on payments. Even Sen. HELP Chairman Bill Cassidy, R-LA, appeared to agree and also raised denial of care by plans, on which Oz concurred.

Oz also said he would defend the Medicare drug price negotiation law in court, is open to international reference pricing for drugs, says pharmacy benefit manager (PBM) reform is needed, and that he has concerns on private equity’s role in healthcare.

Additional articles: https://insidehealthpolicy.com/daily-news/oz-vows-defend-medicare-price-negotiations-court-challenges-open-reference-pricing and https://www.medpagetoday.com/publichealthpolicy/medicare/114668 and https://www.beckershospitalreview.com/hospital-management-administration/dr-oz-vague-on-medicaid-cuts-in-nomination-hearing-6-notes.html and https://thehill.com/homenews/ap/ap-politics/ap-mehmet-oz-senate-hearing-cms/?tbref=hp and https://www.modernhealthcare.com/politics-policy/mehmet-oz-confirmation-hearing-cms and https://www.healthcaredive.com/news/dr-oz-cms-nominee-support-medicaid-work-requirements/742605/

(Some articles may require a subscription.)

#oz #cms #healthcare #coverage #healthcarereform #medicare #medicareadvantage #medicaid #workrequirements #fwa #overpayments #priorauthorization #exchanges #obamacare #pbms #ira #drugpricing #branddrugmakers #privateequity

https://www.fiercehealthcare.com/payers/dr-oz-questioned-over-medicaid-cuts-promises-medicare-advantage-reforms