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Republicans In Stealth Mode On Coverage Cuts, But They Are Real

The GOP pivoted from an overt ACA repeal in 2017 to stealth policy changes today, but the budget reconciliation bill still will reduce coverage. A number of readers and listeners have contacted me to have me help sort out the number of Americans who will be uninsured if the House-passed budget reconciliation also clears the Senate. After all, they note, didn’t President Donald Trump, House Speaker Mike Johnson, and other GOP officials promise no coverage cuts in healthcare, at least in Medicaid? It is a great point and here is my take on it. First, we need a little history. Back in 2017 under Trump 45, the president and a GOP Congress explicitly set out to repeal insurance coverage by substantially gutting the Affordable Care Act (ACA). A repeal bill passed the House, but a skinny one failed in the Senate when Sen. John McCain, R-AZ, returned from his terminal

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June 6, 2025

Say This Three Times: Healthcare Cut Consternation Republican senators are weighing in with leadership regarding concerns with the “Big Beautiful Bill.” Moderates are concerned about spending cuts to Medicaid and the Supplemental Nutrition Assistance Program (SNAP). Budget hawks are demanding more deficit and debt reduction and want the House compromise on state and local tax (SALT) deductions undone. The conservatives also want $200 billion in reductions to Medicare in the area of fraud, waste, and abuse (FWA). There are at least two hard “No’s” on the conservative side. There are other conservatives very concerned and looking for more reductions. On the moderate and pragmatic conservative side, there are a number of senators very concerned about reductions. The House version of the bill would not be able to pass in the Senate as written based on probable numbers of negative votes on either side of the ideological divide. At least 4

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June 5, 2025

Big Beautiful Bill Update Another update on the Big Beautfiul Bill as it seeks to work its way through the Senate. A number of major developments today. A new brief from America’s Essential Hospitals says the Medicaid reductions could mean an increase in hospital uncompensated care of $42.4 billion. The Paragon Health Institute, a conservative think tank with major influence in the administration, is urging the Senate to make changes in the bill to go deeper in terms of cuts and reform. It says lawmakers should make changes in the following areas: Republicans in the Senate are looking at making cuts in Medicare to offset Medicaid cuts or add to overall savings. The likely targets are Medicare Advantage (MA) plan risk adjustment upcoding as well as potentially site neutral payment reform. The Better Medicare Alliance opposes any reduction in MA. Paragon recommended Medicare reforms that could save $712 billion, including

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CMS To Audit All Plans On Risk Adjustment

Risk Adjustment Data Validation (RADV) bombshell should worry Medicare Advantage (MA) plans In a bombshell announcement, beginning immediately the Centers for Medicare and Medicaid Services (CMS) will audit all eligible Medicare Advantage (MA) plans for each payment year in all newly initiated audits and invest additional resources to expedite the completion of audits for payment years (PYs) 2018 through 2024. MA opponents and a bipartisan group of lawmakers have raised issues with what they view as immense overpayments, some of which are tied directly to risk adjustment scoring. CMS says risk adjustment overpayments are about $17 billion a year. CMS’ completed audits for PYs 2011–2013 found between 5% and 8% in overpayments. Richard Kronick and his colleagues at the University of San Diego find that risk scores are 18.5% greater in MA in 2021, amounting to $33 billion. The Medicare Payment Advisory Commission (MedPAC) estimates the risk scoring overpayment figure could

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June 4, 2025

Of Musk, Trump, Medicaid, Medicare, The ACA, And The Uninsured The budget reconciliation saga continues a day after Elon Musk attacked the bill as “a disgusting abomination.” The president leapt into action, trying to convince Senate conservatives to support the package with promises of later spending cuts. The bill hit another pothole today with a new Congressional Budget Office (CBO) score that said the bill will mean more than $1 trillion in cuts over a decade. This is higher due to the last-minute changes made in the House to obtain enough conservatives to pass the bill. The biggest hit comes in Medicaid, with a revised reduction of $864 billion. Work requirements save $344 billion after the House accelerated the provision to no later than December 21, 2026. What’s more, the CBO projects that the Medicaid cuts and other healthcare reductions in the bill will lead to 10.9 million people becoming uninsured, including 7.8 million who

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June 3, 2025

Elon Musk Drops Bomb On Budget Reconciliation Just as Elon Musk exited Washington, the world’s richest man dropped a bomb on Donald Trump’s Big Beautiful Bill by calling it “a disgusting abomination.” Rightists in the Senate were already agitated by the increase in the deficit and debt as well as what they see as a lack of deep spending cuts, but Musk’s remark has egged the conservatives on. Sens. Rand Paul, R-KY, Ron Johnson, R-WI, Rep. Mike Lee, R-UT, and Rick Scott, R-FL, have all raised issues with the deficits and debt. Lee and Paul backed Musk after his comments went viral. On the other hand, at least four moderates and pragmatists in the Senate GOP caucus have expressed concern about Medicaid cuts. Normally conservative Josh Hawley has expressed major misgivings with Medicaid cuts and he said that Trump told him Monday that the final bill would not have Medicaid cuts. That

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June 2, 2025

Major Healthcare Changes At HHS, CMS Centers for Medicare & Medicaid Services (CMS) Deputy Administrator Stephanie Carlton, laid out the agency’s major priorities, which include: More details on the president’s FFY 2026 budget proposal continue to show major reductions to various agencies — an $18 billion cut to the National Institutes of Health (40%), a $3.6 billion cut to the Centers for Disease Control (CDC) (43%), and a $409 million cut to the Food and Drug Administration (FDA) (11%). A number of new initiatives prioritized by health chief Robert F. Kennedy, Jr. are funded along with restructuring tied to the new agenda. Additional articles: https://insidehealthpolicy.com/daily-news/advocates-blast-proposed-cuts-nih-cdc-research-programs and https://www.healthcaredive.com/news/hhs-2026-budget-nih-cuts-trump-healthcare/749510/ (Some articles may require a subscription.) #hhs #cms #rfkjr #nih #fda #cdc https://www.fiercehealthcare.com/regulatory/cms-deputy-stephanie-carlton-lays-out-agency-priorities-0 Budget Reconciliation Questions Continue On Meet the Press, Speaker Mike Johnson, R-LA, defended work requirements and claimed that projections from his own budget office are wrong when it said 4.8

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Managed Care Is Hitting Yet Another Conversion Cycle

A number of chapters in my book, The Healthcare Labyrinth (available at this site and through leading booksellers), tell the story of American healthcare’s conversion from a fee-for-service system to managed care. The truth is that the conversion has not yet fully matured. We still have an over-reliance on traditional transaction payments, which promotes a cost spiral as well as hurts quality attainment. So, the conversion is still in flight and so far I see four so-called conversion cycles of managed care, with the latest hitting just recently. With each cycle, we seem to make some progress toward a better system, but find major barriers still exist. Let’s take a look at the four conversion cycles and where we are headed. I have put together a quick reference table to help illustrate managed care’s maturation over time. Birth of Managed Care – 1970s to 1990s Description/Challenges – The traditional, fee-for-service

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May 30, 2025

More Fallout From Budget Reconciliation The saga over the House reconciliation bill and what the Senate will do continues. Republicans in swing or moderate districts returned home to town halls with tough questions from their constituents about Medicaid and other social service cuts as well as the fact that deficits will increase under the bill. A healthcare policy group KFF issue briefer allocates the Congressional Budget Office’s federal spending reductions and enrollment losses across the states. The CBO’s latest cost estimates say the bill would reduce federal Medicaid spending by $723 billion over the decade timeframe and that the number of uninsured would increase by 7.6 million due to those cuts. KFF finds that the biggest reduction areas in Medicaid are: Federal cuts to states represent 11% of federal spending on Medicaid over the period. By state, the cuts range from 5% in Wyoming, Alabama, and Wisconsin to 15% in

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May 29, 2025

FDA Commissioner Says Cost-Cutting Could Hurt Generic Introductions President Trump’s first Food and Drug Administration (FDA) Commissioner, Scott Gottlieb, made a great point in an opinion piece at statnews.com.  Gottlieb says that Trump did a tremendous job introducing generics swiftly under his first few years in office. Reductions at FDA now could be a boon for brand drug makers as generic approvals will be further backlogged and allow brand makers to effectively maintain a monopoly after patents expire. (Article may require a subscription.) #drugpricing #generics #brands #branddrugmakers #fda https://www.statnews.com/2025/05/28/fda-division-policy-development-generic-drugs-doge-cost-cutting-trump-glp-1s/ PBMs Sue Arkansas Over Ownership Law Pharmacy benefit management managers Express Scripts and CVS Health are suing Arkansas officials to challenge a law that bars PBMs in the state from owning pharmacies. Additional article: https://www.fiercehealthcare.com/regulatory/arkansas-governor-signs-bill-barring-pbms-owning-pharmacies (Some articles may require a subscription.) #pbms #drugpricing #pharmacies https://www.modernhealthcare.com/legal/express-scripts-cvs-health-arkansas-pbms Healthcare Costs For Average Person Went Up 6.7% in 2025 The  Milliman Medical Index (MMI), which

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