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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

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

Study Shows Proliferation Of GLP-1s A new study finds that the number of people prescribed GLP-1 drugs for weight management has skyrocketed over the past five years. FAIR Health’s study finds that just over 2% of adults in the U.S. took a GLP-1 to treat obesity or being overweight in 2024, up from just 0.3% in 2019. For those not diabetic, the percent of such adults increased from 0.03% in 2019 to 0.67% in 2019, or 1,960.9%. While big national providers have sought to expand GLP-1 coverage while de-risking impacts, other plans are discontinuing coverage due to surging costs. A number of Blues are discontinuing obesity-only GLP-1 coverage. In other news, compounders continue filling compounded GLP-1 drugs by arguing individual formulations are allowable. Additional article: https://www.modernhealthcare.com/insurance/bcbs-plans-michigan-massachusetts-glp1-coverage and https://www.healthcaredive.com/news/glp1-obesity-weight-loss-adoption-fair-health/748963/ and https://insidehealthpolicy.com/inside-drug-pricing-daily-news/telehealth-companies-use-loophole-continue-glp-1-sales (Some articles may require a subscription.) #weightlossdrugs #glp1s #healthplans #pbms #drugpricing #branddrugmakers https://www.fiercehealthcare.com/payers/fair-health-heres-how-much-glp-1-prescriptions-obesity-overweight-have-grown-2019 MA Industry Divided On Risk Adjustment Audits

Senate Conservatives Want Deep Cuts Conservative senators are arguing that huge new spending cuts need to be added to the budget reconciliation bill if they are to vote for the package. One lawmaker called the bill a “debt bomb.” At least four senators on the right have raised issues with the long-term implications of more debt and deficits. Deficits will grow from $2.2 trillion a year in FFY 2025 to more than $2.5 trillion in FFY 2035. Many want a return to pre-pandemic levels of spending. The Senate problem is a group of moderates who could sink the bill want fewer Medicaid cuts. Also, a good article on the provider tax reductions and impacts on states and providers. And a good article talking about impacts to younger Americans of losing Medicaid. Additional article: https://stateline.org/2025/05/27/republicans-target-a-tax-that-keeps-state-medicaid-programs-running/ and https://www.healthcaredive.com/news/medicaid-cuts-impact-young-adults-urban-institute/749030/ #budgetreconciliation #trump #congress #medicaid #coverage https://thehill.com/homenews/senate/5316940-trump-bill-fiscal-concerns-republicans CMS To Investigate Illegals On Medicaid Rolls The

More Data Needed On Medicare Advantage Payments While the authors of a Health Affairs Forefront blog appear to be sympathetic to charges that Medicare Advantage (MA) is considerably overpaid, they do admit that more data needs to be shared in order to conclude what many academics find with faulty data. They note that MA now costs about 14% of federal outlays and is projected to grow to 18% by 2034. They repeat the dubious statistic that payments to MA plans exceed by 20% what Medicare would spend in the traditional program. But the authors do note that none of the relevant agencies (the Congressional Budget Office, the Office of Management and Budget, the Medicare Payment Advisory Commission, the Medicare Trustees, or the Centers for Medicare and Medicaid Services Office of the Actuary) has released public assessments of what Medicare spending would be now or in the future, adjusted for health

Senate GOP Looking To Change House Budget Reconciliation Bill Senate Republicans say they’re going to rewrite the 1,116-page budget reconciliation bill the House passed on a tight vote. House Speaker Mike Johnson, R-LA, says the Senate needs to be judicious and make minimal changes to avoid another showdown in the House that could sink the bill. But Senate Majority Leader John Thune, R-SD, said his body will definitely have an imprint on the bill. The Senate is generally far more independent than the House. The ideological split we saw in the House is now emerging in the Senate. Rightist Rand Paul, R-KY, will vote against the bill given the provision that increases the debt limit dramatically. Conservatives Ron Johnson, R-WI, Rick Scott, R-FL, and Mike Lee, R-UT, argue much deeper cuts need to occur. Johnson says the bill has a $2.2 trillion deficit on average each year and the bill

Reconciliation Bill Already Creating Anxiety In Senate As the House budget reconciliation bill moves to the Senate, signs are appearing already of a deep ideological divide over the bill. At least two conservatives, Rand Paul, R-KY, and Ron Johnson, R-WI, have questioned whether they will vote for the bill – Paul due to the debt limit provision and Johnson because of too few spending cuts and surging debt. At the same time, moderates and pragmatic conservatives are pushing for Medicaid reductions to be rolled back. Both Lisa Murkowski, R-AK, and Josh Hawley, R-MO, want Medicaid changes. Susan Collins, R-ME, has also weighed in on Medicaid in the past. There are others, too, who are concerned. As such, the Senate has too few votes to pass the House version due to opponents on each side. See my blog today for more details: https://www.healthcarelabyrinth.com/the-budget-rollercoaster-reconciliation-advances-but-big-debate-looms-in-senate/ . In other news, a Modern Healthcare article

House Passes Reconciliation Bill; On To An Uncertain Fate In Senate (UPDATED 5/22 AM) The House threaded the needle and passed the budget reconciliation bill on a tight 215-to-214 vote. Two Republicans voted against the bill, and one voted present to get the bill to pass. The vote was a result of a marathon session and backroom arm-twisting by President Trump, House Speaker Mike Johnson, and other House GOP leaders. President Trump met with the caucus this week and laid down the law, telling moderates to drop their SALT demands (they did to some degree) and conservatives not to “f—” with Medicaid. The House leaders thread the needle by a mix of further concessions and appealing to party unity. The conservatives wanted additional Medicaid structural changes and accelerated reductions. They were conceded acceleration of work requirements from 2029 to essentially 2027. It is likely impossible for states to do so

HHS Explains MFN Drug Price Approach The Department of Health and Human Services (HHS) issued guidance regarding President Donald Trump’s recent executive order regarding adopting most favored nation (MFN) drug pricing throughout the country. If Big Pharma brand drug makers were not worried before, they should be now. An HHS press release laid out expectations for how drug makers will engage with the order. It notes all brand products that do not currently have generic or biosimilar competition across all markets (lines of business) are covered. It says drug companies must “commit to aligning” their U.S. prices with “the lowest price of a set of economic peer countries.” The peer group is the so-called rich nations as represented by the Organization for Economic Co-operation and Development countries and that have a gross domestic product (GDP) per capita of at least 60% of the U.S. GDP. Big Pharma came out swinging,

House Budget Committee Advances Reconciliation Bill After a high-profile defeat Friday, the House Budget Committee advanced the budget reconciliation bill with $625 billion in Medicaid reductions Sunday night. Four House Freedom conservatives in the GOP caucus voted present to advance the bill, apparently with commitments that changes will be made to the bill. A prominent conservative, Chip Roy, said work requirements would be accelerated. He also mentioned the need for steeper provider tax cuts and a rollback of the enhanced reimbursement for the Medicaid expansion. If all House moderates are on the bill now (a big if), they would likely jump off with steeper Medicaid cuts. Providers and doctors are sounding the alarm on coverage losses, lower state dollars, administrative costs, and red tape. Health policy group KFF published two briefs: one on the 15 states that would be impacted with lower reimbursement if they maintain undocumented immigrants and the