Insights^

On November 25, 2025, the Centers for Medicare & Medicaid Services (CMS) released a proposed rule that would revise the Medicare Advantage (MA) Program, the Medicare Prescription Drug Benefit Program (Part D), and the Medicare Cost Plan Program for Contract Year 2027 (PY27). The CMS press release can be found here. A CMS fact sheet can be found here.  The 60-day comment period under the Administrative Procedure Act (APA) for the PY27 MA/Part D Proposed Rule ends on January 26, 2026.

MA & PART D: UPDATES TO STAR RATINGS

The MA and Part D Star Ratings program evaluates plan performance on a 1-to-5-star scale across up to 43 measures for MA-PD contracts, 33 for MA-only, and 12 for Part D, covering categories like outcomes, intermediate outcomes, process, patient experience, and access. Ratings are based on CMS administrative data, enrollee surveys, and plan-submitted information. These ratings influence quality bonus payments (QBPs) for MA plans (up to 5-10% added to benchmarks for 4+ star plans), beneficiary rebates (50–70%), marketing rules, and the way consumers are presented plan options in the Medicare Plan Finder.

In keeping with the Trump administration’s effort to deemphasize equity programs, the CY27 proposed rule would eliminate the Biden-era Excellent Health Outcomes for All reward (formerly the Health Equity Index or HEI). This reward – finalized in the 2023 final rule for implementation in CY27 – was intended to incentivize high measure-level performance among enrollees with specific social risk factors (SRFs), such as dual eligibility for Medicare and Medicaid, receipt of the low-income subsidy (LIS), or disability. For CY27, the Biden-era reward would have given plans an HEI score ranging from -1 to 1 based on a subset of measures, and those plans with positive HEI scores would have received a bonus added to their overall Star Rating (0.4 for the top third, 0.267 for the middle third, and 0.133 for the bottom third). As proposed, the CY27 rule would eliminate this construct while retaining the historical reward factor (which similarly rewards plans but emphasizes improvement efforts in clinical care, outcomes, and patient experience across the entire patient population).

Continuing the administration’s deregulation theme, the CY27 proposed rule would also remove 12 measures starting from the 2027 measurement year. Removals would take effect for the 2028- or 2029-Star Ratings, depending on the measure. The measures slated for removal under the CY27 proposed rule include:

• Plan Makes Timely Decisions about Appeals (Part C, 2029)
• Reviewing Appeals Decisions (Part C, 2029)
• SNP Care Management (Part C, 2029)
• Call Center – Foreign Language Interpreter and TTY Availability (Part C, 2028)
• Call Center – Foreign Language Interpreter and TTY Availability (Part D, 2028)
• Complaints about the Health/Drug Plan (Parts C and D, 2029)
• Medicare Plan Finder Price Accuracy (Part D, 2029)
• Diabetes Care – Eye Exam (Part C, 2029)
• Statin Therapy for Patients with Cardiovascular Disease (Part C, 2028)
• Members Choosing to Leave the Plan (Parts C and D, 2029) \
• Customer Service (Part C, 2029) • Rating of Health Care Quality (Part C, 2029)

If finalized, these changes would, in the aggregate, have the practical effect of increasing QBPs to plans. Simulations using 2025 data show 62% of contracts with unchanged ratings, 13% gaining 0.5 stars, 25% losing 0.5 stars, 5% gaining QBP eligibility, and 4% losing it. CMS estimates these shifts in Star Rating status would result in a $13.18 billion net increase in Medicare Trust Fund spending over the 2027–2036 window (0.15% of MA payments). CMS projects that much of that increase (~$7.3 billion) would occur in the CYs 28 and 29.

MA: OPERATIONAL REFORMS

Per President Trump’s executive order (EO) #14192 (“Unleashing Prosperity through Deregulation”), the CY27 proposed rule includes several proposed reforms intended to reduce the regulatory burden on plans and, therefore, the marginal operational costs passed on to beneficiaries by those plans. Proposed changes include:

• Exempting account-based plans from creditable coverage disclosures: Currently, group health plans, including account-based arrangements such as Health Reimbursement Arrangements (HRAs), Flexible Spending Accounts (FSAs), and Health Savings Accounts (HSAs), must disclose their creditable prescription drug coverage status to CMS and Medicare-eligible individuals. CMS proposes amending this section to exclude these plans, as they do not directly offer drug coverage but only reimburse expenses. In practice, this would eliminate redundant paperwork for about 7,049 entities (mostly HR managers), saving approximately 585 hours and $90,266 annually.
• Rescinding mid-year notices for unused supplemental benefits: MA organizations must mail individualized mid-year notices by July 31 detailing unused supplemental benefits from the Evidence of Coverage. The proposal would rescind this requirement entirely. Practically, this reduces administrative burdens, yielding annual savings of $1.36 million in printing/mailing, plus $499,091 in one-time costs for system updates.
• Eliminating health disparities activities in MA quality improvement programs: Under § 422.152(a) (5), MA organizations must incorporate activities to reduce health disparities into their Quality Improvement (QI) programs. CMS proposes removing this requirement.
• Eliminating health equity requirements for MA Utilization Management (UM) Committees: Current rules at § 422.137(c)(5) require a health equity expert on UM Committees, and §§ 422.137(d)(6)– (7) mandates annual health equity analyses of prior authorizations. The proposal would rescind these provisions. In practice, this streamlines committee operations by saving about 6,040 hours and $814,000 annually in data aggregation and posting, enabling focus on core UM functions, but potentially reducing targeted equity reviews for vulnerable populations.
• Waiving the LI NET call center hours requirement: The Limited Income Newly Eligible Transition (LI NET) program currently requires toll-free call centers to be open from 8 a.m. to 8 p.m. in all regions. CMS proposes amending this requirement to limit hours to 8 a.m.–7 p.m. ET, Monday–Friday. This adjustment accounts for low call volumes and 24/7 pharmacy support, saving $800,000–$1 million annually in operational costs.

MA: SPECIAL ENROLLMENT PERIOD REFORMS

The MA program currently includes a Special Enrollment Period (SEP) for enrollees affected by a “significant” provider network change, such as terminations of providers or facilities, where significance is determined, case by case, by CMS and the MA organization based on factors like the scale of the termination. Affected enrollees – those assigned to, receiving care from, or who received care within the past three months from the terminated provider – can switch MA plans or disenroll to Original Medicare, but only if notified of eligibility. MA organizations must send termination notices, but these do not always include detailed SEP information, and separate notifications may be required for eligibility. CMS guidance (but not rules) requires that certain other SEPs, such as those for CMS sanctions, contract violations, or exceptional circumstances, receive CMS approval.

In the CY27 proposed rule, CMS proposes to modify the SEP for provider terminations by renaming it from “Significant Change in Provider Network” and eliminating the “significant” determination requirement, making eligibility automatic for affected enrollees upon any no-cause provider or facility termination. The SEP would begin in the month of eligibility notification and last for two additional calendar months, usable once per network change, with MA organizations assessing eligibility via beneficiary attestations rather than solely through 1-800-MEDICARE. Termination notices would be enhanced to include mandatory details on SEP eligibility, start/end dates, Annual Enrollment Period (AEP), MA Open Enrollment Period (MA-OEP), Medigap guaranteed issue rights, and impacts on employer/union coverage.

Separately, CMS proposes codifying the requirement for prior CMS approval of certain SEPs at §§ 422.66(g), 423.32(k), and 423.36(g), mandating that MA organizations obtain approval via CMS-operated mechanisms (e.g., 1-800-MEDICARE, Online Enrollment Center, or notices) before transmitting elections for specified SEPs like contract violations or sanctions.

MA: REQUESTS FOR INFORMATION (RFIS)

CMS includes several RFIs in the CY27 Proposed Rule to gather public input on enhancing the Medicare Advantage program, including:

• Dually Eligible Individual Enrollment Growth in C-SNPs and I-SNPs: CMS seeks comments on the significant growth in dually eligible individuals enrolling in chronic condition special needs plans (C-SNPs) and institutional special needs plans (I-SNPs) rather than dual eligible special needs plans (D-SNPs). Comments are sought on policy solutions such as requiring State Medicaid Agency Contracts for plans with high dually eligible concentrations (e.g., 60%+), enhancing care coordination requirements, applying D-SNP look-alike limitations, and strategies to encourage C-SNPs focused on mental health or substance use disorders.
• Future Directions in Medicare Advantage Risk Adjustment: CMS solicits input on modernizing the MA program through risk adjustment, including leveraging AI and alternative data sources for nextgeneration models, to promote data transparency, quality improvement, competition, taxpayer savings, and fraud reduction, potentially via programmatic changes or Innovation Center models.
• Future Directions in Medicare Advantage Star Ratings: CMS requests feedback on simplifying and streamlining the Star Ratings program, including reducing timelines from measure development to implementation and shortening the lag between measurement years and payment application to better incentivize quality improvements.
• Quality Bonus Payments in Medicare Advantage: CMS seeks information to refine the QBP structure and its impact on rebates, including options to shorten new-measure implementation timelines, delink bonuses from MA bids through an Innovation Center model, and broader strategies to encourage cost containment alongside enhanced care quality.
• Well-Being and Nutrition: CMS solicits input on tools and policies to improve overall health, happiness, and life satisfaction in MA, including emotional well-being, social connections, self-care, and nutrition strategies like promoting healthy eating, preventive care, and incentives for MA organizations to support long-term beneficiary nutritional habits.
• Marketing and Communications Oversight: CMS seeks comments on modernizing agent/broker regulations and marketing requirements, including redefining the Third-Party Marketing Organizations (TPMO) definition to segment by size, scope, or role; modifying the 5% translation threshold for materials; removing the requirement for CMS approval of Medicare card images in ads; revising testimonial standards for authenticity, substantiation, and disclosures; eliminating outbound enrollment verification and certain mailing statements; reducing call recording retention periods; and broader strategies for accountability, data-driven monitoring using AI, and preventing misleading practices.
• Other Medicare Advantage Program Areas: CMS solicits input on deregulation and simplification across various MA aspects, such as updating medical loss ratio calculations and reporting; streamlining network adequacy reviews, exceptions (including a new “pattern of care” exception), and access standards; enhancing oversight of supplemental benefits design and marketing; revising SNP Model of Care requirements; automating data sharing; and identifying burdensome reporting elements.

PART D: IMPLEMENTING CERTAIN PROVISIONS OF THE INFLATION REDUCTION ACT (IRA) OF 2022

The IRA significantly redesigned the Medicare Part D benefit to lower beneficiary costs, including eliminating the coverage gap phase, reducing the annual out-of-pocket (OOP) threshold starting at $2,000 (with annual indexing based on per capita Part D costs or CPI-U), and removing enrollee cost sharing in the catastrophic phase (setting it to $0 after the OOP threshold is met). It also terminated the Coverage Gap Discount Program (CGDP) and replaced it with the Manufacturer Discount Program (MDP), which requires manufacturers to provide discounts on applicable drugs (brand-name drugs under New Drug Application or Biologics License Application, excluding selected drugs under negotiation) in the initial coverage and catastrophic phases. The IRA granted CMS temporary authority to implement these changes through sub-regulatory program instructions and guidance through 2026. As part of the CY27 rule, CMS proposes to formally codify these reforms through rulemaking. A summary is below.

• CMS proposes to codify the termination of the CGDP for 2027. The CGDP (under which manufacturers provided 70% discounts on applicable drugs for non-LIS beneficiaries in the coverage gap) technically terminated on January 1, 2025, but continues to handle discounts and reconciliations for drugs dispensed before that date. If finalized, these changes would permanently sunset the program, ensuring that no new agreements or discounts apply after 2024.
• CMS proposes establishing a new Subpart AA to codify the MDP for 2027 and beyond, requiring manufacturers to enter agreements covering all labeler codes for applicable drugs, provide 10% discounts in the initial coverage phase and 20% in the catastrophic phase (calculated on negotiated price including dispensing fees, taxes, and units), with phase-ins for specified manufacturers (based on 2021 Part D spending ≥1% or 2.5% for LIS/non-LIS) and small manufacturers (one drug ≥80% of expenditures). Proposed additions include detailed rules on aggregation, acquisitions, terminations, audits, disputes, and civil penalties.
• CMS proposes codifying OOP changes for 2027 and beyond by revising § 423.100 to limit “coverage gap” definitions to 2006–2024, amending § 423.104(d)(4) for pre-2025 applicability, eliminating the initial coverage limit post-2024 (§ 423.104(d)(3)(iii)), setting the reduced OOP threshold at $2,000 for 2025 and indexing it annually (§ 423.104(d)(5)(iii)(G)–(H)), and confirming $0 cost sharing in the catastrophic phase (§ 423.104(d)(5)(i)).

On November 28, 2025, the Centers for Medicare and Medicaid Services (CMS) released the Calendar Year (CY) 2026 Home Health Prospective Payment System Final Rule. A CMS fact sheet can be found here.  The 60-day comment period under the Administrative Procedure Act (APA) for the CY26 Home Health Final Rule ends on January 27, 2026.

UPDATES TO HOME HEALTH AGENCY PAYMENT RATES

The Bipartisan Budget Act (BBA) of 2018 directed CMS to create the Patient-Driven Groupings Model (PGDM), intended to improve reimbursement for all patients eligible for home health benefits and to remove perceived incentives to over-provide therapy services. As part of this system, CMS applies two types of “behavioral adjustments” to ensure budget neutrality and prevent “gaming” that increases payments:

• Prospective adjustments are based on past conduct but are meant to prevent future overpayments. To assess the need for such adjustments, CMS calculates whether the actual expenditures (from two years prior) deviated from the agency’s estimate of what expenditures would have been under the pre–BBA system. CMS has made annual cuts since the start of PDGM. However, the magnitude of those cuts has been such that CMS has typically phased them in over 2 years. This has resulted in a dynamic in which CMS often implements cuts that were partially delayed from the year prior, as well as new cuts to account for “newly discovered” deviations from two years prior.
• Retrospective adjustments are intended to claw back overpayments already made when past conduct led to higher-than-expected payments (i.e., CMS’s prospective adjustments were not sufficient to prevent overpayments relative to the pre-BBA system). Since the start of PDGM, CMS has been keeping a running tally of overpayments, which currently totals ~$5.3b (through CY24; that figure is likely to grow once CY25 and CY26 – the final two years of the PDGM phase-in – are complete).

For CY26, CMS proposed an aggregate -6.4% cut to home health agency payments relative to FY25. Of this, 2.4% represented the CY26 home health market basket update. With respect to the PDGM adjustments, CMS first proposed a permanent prospective behavioral adjustment of -3.7% (-1.8%) attributable to a lingering phased-in cut from CY25 (projected based on CY23 spending) and -1.9% representing a new cut (projected based on CY24 spending). CMS then proposed – despite prior assurances it would not pursue prospective and retrospective cuts simultaneously – an incremental retrospective cut of -4.6% (accounting for ~15% of the amount that needs to be recouped). Finally, CMS proposed a fixed dollar loss (FDL) ratio adjustment of -0.5%.

In the final rule, CMS finalized policies resulting in an overall -1.3% (-$220m) cut to aggregate Medicare payments to home health agencies for CY26 compared to CY25. The net rate update is based on the following:

• 2.4% home health market basket update (unchanged from proposed rule).
• -0.9% permanent prospective PDGM cut (rather than phasing the cut over multiple years as in prior rules, CMS achieved softening by excluding CY23 and CY24 claims data from the permanent adjustment calculation and relying solely on CY20–22 data).
• -2.7% temporary retrospective PDGM cut (softened, but not abandoned, out of concern for provider impact).
• -0.1% FDL ratio cut (softened based on updated claims data).

Although CMS significantly softened the CY26 impact by reducing the permanent behavioral adjustment and lowering the temporary recoupment amount, the deferred over-expenditures from 2023 and 2024 remain outstanding and will need to be addressed in future years. This continues the pattern of recent rules in which significant adjustments are repeatedly deferred rather than fully implemented, causing the cumulative amount owed under PDGM budget-neutrality requirements to grow. Absent Congressional intervention to waive or reform the behavioral offset provisions (as requested by industry stakeholders), these deferred cuts will eventually translate into larger permanent rate reductions or extended temporary recoupments in the out-years, creating ongoing payment uncertainty for home health agencies.

HOME HEALTH QUALITY REPORTING PROGRAM (HH QRP)

The HH QRP is an initiative that requires certified home health agencies to submit standardized data, primarily through the Outcome and Assessment Information Set (OASIS) instrument, to measure and improve the quality of care provided to patients. This program ties data submission compliance to annual payment updates, imposing a 2% reduction in the home health market basket percentage increase for non-compliant agencies, which can result in lower payments than the prior year under certain conditions. The HH QRP aims to enhance care quality, increase transparency for consumers, and promote better health outcomes.

For CY26, CMS proposed removing the COVID-19 Vaccine: Percent of Patients Who Are Up to Date measure and its associated OASIS item O0350, effective for assessments on or after the final rule’s publication date, with the item fully removed from OASIS by April 1, 2026. CMS also proposed eliminating four social determinants of health assessment items related to living situation, food, and utilities, effective for patients discharged on or after April 1, 2026. Additional proposals included revising the reconsideration process for data noncompliance to allow requests demonstrating full compliance and limited extensions for extraordinary circumstances; and updating the Home Health Consumer Assessment of Healthcare Providers and Systems (HHCAHPS) survey with new questions, removals, and adjustments starting with the April 2026 sample month.

CMS finalized the HH QRP proposals without modification.

HOME HEALTH VALUE-BASED PURCHASING (HHVBP) MODEL

The HHVBP Model is a program that adjusts payments to certified home health agencies based on their performance on a set of quality measures, aiming to improve the quality of care provided to beneficiaries. Under this model, agencies receive a total performance score derived from measures in categories such as OASIS-based outcomes, claims-based utilization, and patient experience surveys, which determine payment adjustments ranging from -5% to +5%. The HHVBP Model encourages agencies to enhance care delivery, reduce unnecessary hospitalizations, and promote better patient outcomes by rewarding high performers.

For CY26, CMS proposed updates to the HHVBP Model’s measure set, including the removal of three HHCAHPS survey-based measures (Professional Care of Patients, Communications Between Providers and Patients, and Specific Care Issues) due to planned revisions in the HHCAHPS survey. CMS also proposed adding four new measures: three OASIS-based measures (Improvement in Grooming, Improvement in Toileting Hygiene, and Improvement in Feeding or Eating) and one claims-based measure (Medicare Spending Per Beneficiary-Post-Acute Care Home Health). Additional proposals included adjustments to the weights of measures/categories to reflect the updated set, as well as the addition of a new measure removal factor for measures that are not feasible to implement.

CMS finalized the HHVBP Model proposals without changes from the proposed rule.

FACE-TO-FACE ENCOUNTER REGULATIONS

The face-to-face encounter regulation requires a certifying physician to conduct an encounter with the patient to certify eligibility for Medicare home health services and to establish or review the plan of care. This encounter must occur within specified timeframes, be related to the primary reason the patient requires home health services, and include documentation explaining how the patient’s clinical condition supports homebound status and the need for skilled services.

For CY26, CMS proposed – in compliance with CARES Act revisions enacted by Congress – revising the language at 42 CFR 424.22(a)(1)(v)(A) to allow the face-to-face encounter to be performed by a physician, nurse practitioner, clinical nurse specialist, physician assistant, or certified nurse midwife. CMS also proposed removing 42 CFR 424.22(a)(1)(v)(C), which had limited the encounter to the certifying practitioner or to a physician or non-physician practitioner who cared for the patient in an acute or post-acute facility from which the patient was directly admitted to home health and who is different from the certifying practitioner.

CMS finalized the proposed changes to the face-to-face encounter regulations without modification.

FRAUD, WASTE, & ABUSE REFORMS

CMS and stakeholders have expressed significant concerns about waste, fraud, and abuse in the home health industry, including vulnerabilities to improper payments, abusive billing practices, and unqualified providers entering the program (concerns validated by recent GAO and OIG investigations showing unusually high improper payment rates in home health agencies, particularly in states such as California, Pennsylvania, and Texas). To that end – and given the Trump administration’s intense focus on reducing wasteful federal spending – CMS proposed several revisions to Medicare provider enrollment regulations to strengthen program integrity and address fraud, waste, and abuse, including:

• Expanding the grounds for revocation or denial of enrollment to cover abusive billing patterns, beneficiary attestations that services were not furnished, and modifications to language around prescribing authority for Medicare-covered drugs.
• Expanding the retroactive effective dates for revocations to the onset of noncompliance in additional scenarios, such as lapsed liability insurance for independent diagnostic testing facilities, failure to report required changes, or abusive billing, to enable recovery of improper payments from that date.
• Other reforms, such as requiring providers and suppliers to report adverse legal actions within 30 days, deactivating billing privileges for physicians and practitioners who have not ordered or certified services in 12 consecutive months, and making technical corrections to related regulatory text.

CMS finalized the Medicare provider enrollment provisions as proposed, without modification.

AGENCY REPLIES TO REQUESTS FOR INFORMATION (RFIS)

The proposed rule included four Requests for Information (RFIs) related to the Home Health Quality Reporting Program (HH QRP) and the expanded Home Health Value-Based Purchasing (HHVBP) Model, and the final rule summarized the public comments received. An overview of those RFIs is below.

• Data Submission Deadlines for HH QRP: Commenters generally supported reducing the deadline from 4.5 months to 45 days after the end of the reporting period to enable more timely public reporting and decision-making, though some suggested phased implementation, pilot programs, or alternatives like 60 or 90 days; concerns included increased administrative burden, potential errors, and financial pressures on smaller agencies.
• Digital Quality Measures for HH QRP: Commenters expressed strong support for transitioning to digital quality measures using standards like Fast Healthcare Interoperability Resources to reduce burden and improve quality, with recommendations for phased implementation, funding, technical assistance, APIs, and training; concerns focused on varying IT readiness among agencies and the lack of HITECH-like funding for home health.
• Future HH QRP Quality Measure Concepts: Commenters supported concepts in interoperability (e.g., national standards and federal funding, with barriers like low IT adoption noted), cognitive function (e.g., emphasis on maintenance rather than improvement and limitations of existing OASIS tools), well-being (e.g., evidence-based tools, process measures, and caregiver input, with concerns about scope in short stays), and nutrition (e.g., validated tools like the Malnutrition Composite Score and process measures, though some opposed due to complexity and short timeframes).
• Future HHVBP Measure Concepts: Commenters supported a respecified Falls with Major Injury measure using multiple data sources but raised concerns about reporting accuracy, episodic care, and unintended penalties; for HHCAHPS changes, there was opposition to achievement-only scoring and single-item additions, with preferences for full improvement points and patient-reported outcomes.

On November 19, 2025, the Senate Finance Committee held a hearing on the rising costs of health care. Overall, there was agreement that any reforms need bipartisan support. However, the hearing also featured a clear partisan divide: Democrats advocating for the extension of advance premium tax credits (APTCs), and Republicans suggesting that assistance for consumers should come through health savings accounts (HSAs) and flexible spending accounts (FSAs).

OPENING STATEMENTS

• Chairman Mike Crapo (R-ID)

WITNESS TESTIMONY

• Dr. Douglas Holtz-Eakin, PhD, President, American Action Forum – Testimony
• Mr. Jason Levitis, Senior Fellow, Health Policy Division, Urban Institute – Testimony
• Dr. Brian Blase, PhD, President, Paragon Health Institute – Testimony
• Mr. Bartley Armitage, Citizen – Testimony

MEMBER DISCUSSION

Extension of Advance Premium Tax Credits (APTC)

All Democrats in attendance, as well as Sen. Thom Tillis (R-NC), expressed support for at least a 1-year extension of the APTCs. These senators argued this would allow time for a larger reform process that could explore some of the other options floated in the hearing. Mr. Levitis supported this approach, stating more than once that the current IT infrastructure would not allow time for policy changes other than APTC extension to reach consumers.

Most Republicans in attendance, Chair Crapo (R-ID), Sens. John Cornyn (R-TX), Bill Cassidy (R-LA), Steve Daines (R-MT), Ron Johnson (R-WI), John Barrasso (R-WY), and Roger Marshall (R-KS), opposed the extension. These senators argued that such a measure would only place more money in the pockets of health insurance companies, allow fraud to continue, and perpetuate mistakes created in the Affordable Care Act.

HSAs/FSAs

Republicans, including Chairman Crapo, Sen. Cassidy, and Sen. Marshall, advocated for expanding access to HSAs and providing appropriate funds to fund them. Dr. Holtz-Eakin was supportive of this option but did concede that HSAs would not reach everyone and would not be able to be implemented on a large scale for 2026. Mr. Blase suggested that the money to fund HSAs could come from Cost Sharing Reduction (CSR) funding and would allow consumers greater control, instead of money going directly to health insurance companies. Mr. Blase further stated that he expected a 12% decrease in premium costs if this option were to be implemented.

Sen. Tina Smith (D-MN) asked Mr. Armitage if a check or HSA funding would help relieve the cost burden that he and his family are facing, to which Mr. Armitage replied that it would only help for “a couple of months,” and then he would be back in the same position he was before. When Mr. Levitis was asked his opinion on an HSA option, he was skeptical due to the lack of HSA access for people without insurance and stated that FSAs have been shown to increase health care spending. Sen. Raphael Warnock (D-GA) expressed a similar point, saying that HSAs are not helpful to those who cannot afford to enroll in ACA plans, and the money cannot be used to pay for premiums.

Government Regulation

There were competing opinions about the extent to which the federal government should regulate the health insurance market. On one end of the spectrum, Sen. Bernie Sanders (I-VT) proposed a universal health care, “Medicare for All” model, with a single, government payer system, which Sen. Peter Welch (DVT) agreed with. On the other side, Mr. Blase and Dr. Holtz-Eakin both suggested deregulation of health insurance to increase competition and choice in the private insurance sector. Sens. Cornyn, Johnson, and Barrasso agreed with this approach, saying they wanted to provide more health care shopping options for consumers, which, they argue, would force insurance plans to compete, therefore raising quality and lowering cost.

Other Suggestions

Some other reform suggestions mentioned came from both parties. Sen. Sheldon Whitehouse (D-RI) suggested shifting more to value-based care payments and ending prior authorization practices, which Mr. Levitas agreed with. Sen. Maria Cantwell (D-WA) suggested expanding Basic Health Program options to those within 250% or 300% of the federal poverty line, depending on the state. Sen. Barrasso mentioned reopening other pooling measures, such as the Farm Bureau plans for rural populations, and Sen. Tillis expressed support for catastrophic health plan options.

On November 19, 2025, the House Ways and Means Health Subcommittee held a hearing on modernizing care coordination to prevent and treat chronic disease. There was discussion about ways to combat rising medical costs as well as preserving access to care, especially for populations in need.

OPENING STATEMENTS

• Chairman Vern Buchanan (R-FL-16)
• Ranking Member Lloyd Doggett (D-TX-37)

WITNESS TESTIMONY

• Dr. Michael Hoben, MD, Chief Medical Officer of Population Health Services, Novant Health – Testimony
• Mrs. Allison Reichert, PharmD, Pharmacist, Bode Drug – Testimony
• Dr. Ashish Parikh, MD, Chief Population Health Officer, Summit Health – Testimony
• Mr. Brian Connell, Vice President of Federal Affairs, Blood Cancer United – Testimony

MEMBER DISCUSSION

Extension of the Advance Premium Tax Credits (APTCs)

The most repeated argument made by Democrats in attendance was the need to extend the APTCs for at least 1 more year. Reps. Mike Thompson (D-CA-04), Judy Chu (D-CA-28), and Danny Davis (D-IL-07) all argued that you cannot coordinate care for those without access to it. Subcommittee Ranking Member Lloyd Doggett (D-TX-37) questioned Mr. Connell on what would happen to patients with chronic diseases if their health insurance coverage lapsed due to unaffordable premiums, to which Mr. Connell replied that there is no self-pay option for cancer treatments, and health care costs will increase due to more frequent emergency room visits to manage chronic diseases. Rep. Kevin Hern (R-OK-01) pushed back, stating that costs need to be lowered for all populations, not just those who are on ACA marketplace plans.

The Democrats were also strongly against replacing APTCs with health savings accounts (HSAs). Ranking Member Lloyd Doggett argued that APTCs go directly to pay for health care costs while HSAs can be used to finance other purchases. Rep. Greg Murphy (R-NC-03) rebutted that HSAs give patients greater choice in their health care spending. Rep. Blake Moore (R-UT-01) conceded that HSAs are currently only available for high deductible insurance plans and advocated for the passage of H.R.955, which would allow expanded access to tax-advantaged health savings accounts.

Extension of Telehealth Services

There was bipartisan support for extending and expanding COVID-era telehealth services. Reps. Thompson, Hern, Brian Fitzpatrick (R-PA-01), and Moore all agreed that telehealth options improve access, especially in rural areas and among senior populations, while lowering the cost of care. Mr. Connell, Dr. Hoben, and Dr. Parikh agreed as well, saying that connecting increased care options with lower costs and better continuity of care would keep patients out of emergency rooms.

Expansion of Provider Licensing

Full Committee Chairman Adrian Smith (R-NE-03) expressed support for expanding care options for pharmacists through his legislation H.R.3164, which would allow pharmacists to test and treat for common diseases, such as influenza, without seeing a primary care provider. Dr. Reichert also agreed that including pharmacists as part of the broader care team would help address the needs of patients with chronic diseases. Dr. Reichert stated that federal recognition of pharmacists as providers would preserve access to care, especially for rural and senior populations. Rep. Greg Steube (R-FL-17) was in favor of a similar status for chiropractors, mentioning H.R.539, which would expand Medicare coverage to all chiropractic services, allowing chiropractors to be a larger part of a chronic pain care team.

On November 19, the Department of Homeland Security (DHS) published in the Federal Register a propsoed rule rescinding the 2022 public charge ground of inadmissibility regulations. Public comments are due December 19, 2025. This memorandum presents a high-level summary of the pre-release version of the rule.

I. BACKGROUND AND REGULATORY CONTEXT

The proposed rule represents a significant shift away from the narrower 2022 public charge framework and moves toward a more expansive interpretation similar to the 2019 rule. If finalized, the rule will increase disenrollment, disrupt care, and place significant documentation burdens on Medicaid Plans and members. The proposed rule establishes a transition framework whereby applications filed before the final rule’s effective date follow the existing 2022 rule, and those filed after must comply with the new framework.

II. 8 CFR 103 – PROCEDURAL AMENDMENTS

The proposed rule updates procedural provisions governing DHS adjudications and introduces enhanced oversight structures for public charge bond monitoring and enforcement. The agency proposes revised notice procedures for bond breach, clarified timelines, and increased evidence submission options. These changes formalize the agency’s authority to request additional information regarding an applicant’s financial stability or benefit utilization.

III. 8 CFR 212.21 – DEFINITIONS

The proposed rule expands and clarifies multiple public charge–related definitions, including ‘public benefit’, ‘cash assistance for income maintenance’, and ‘long-term institutionalization’. Unlike the 2022 rule, which excluded most non-cash benefits, the proposed rule opens the door to including programs such as Medicaid, nutritional programs, housing vouchers, and other social supports. The agency requests comment on which non-cash benefits may be considered predictive of future dependence.

IV. 8 CFR 212.22 – PUBLIC CHARGE INADMISSIBILITY FRAMEWORK

The agency reinstates a broad, multi-factor totality-of-the-circumstances test aligned with section 212(a) (4) of the Immigration and Nationality Act. The agency proposes updated evidentiary standards that require detailed disclosures about income, assets, liabilities, credit history, health conditions, household size, and benefit use—including non-cash programs. Applications may be evaluated using weighted negative factors such as benefit receipt, poor health combined with lack of insurance, limited English proficiency, and limited financial reserves. Positive factors may include high income, private health insurance, strong employment history, and education or skills.

Fear of immigration consequences may cause members to disenroll from Medicaid or decline medically necessary services. This poses continuity-of-care risks, affects quality metric performance, and increases costs associated with preventable acute events.

A. Age

The proposed rule reintroduces age as a weighted factor. Applicants at extremes of age may be viewed as higher risk for future dependence. For health plans, this may reduce enrollment among older immigrants seeking Medicaid for chronic care or younger dependents requiring pediatric services.

B. Health

The proposed rule explicitly links negative weight to health conditions requiring ongoing medical treatment without adequate insurance coverage. This may incentivize immigrant members to avoid documenting chronic illnesses or seeking needed specialty care. Plans may see increased emergency utilization and unreported conditions.

C. Family Status

Larger households may be negatively evaluated if resource limitations are present. Immigrant families may avoid enrolling eligible children in Medicaid/CHIP to minimize the appearance of reliance on benefits.

D. Assets, Resources, and Financial Status

Expanded financial documentation may require applicants to disclose assets, debt, liabilities, and remittances. Immigrants may believe that using Medicaid indicates insufficient resources, prompting disenrollment.

E. Education and Skills

Lower education levels or limited English proficiency may be treated as negative predictors of future self-sufficiency. This may affect vulnerable immigrant groups and impact culturally competent outreach efforts by plans.

F. Benefit Use History

The proposed rule seeks comment on including non-cash benefits such as Medicaid, HCBS, WIC, SNAP, or housing assistance. If adopted, immigrant enrollees may fear any interaction with public benefits, disrupting continuity of care and leading to worse outcomes and higher costs.

V. 8 CFR 213 – PUBLIC CHARGE BONDS

The proposed rule revamps the public charge bond system. Bonds may be required where an applicant presents risk of future dependence. The agency defines breach more clearly: benefit receipt during the enforceable period, failure to meet financial obligations, or misreporting. Bond cancellation criteria are also updated, allowing cancellation upon attainment of LPR status, end of enforceability, or proof of financial stability.

VI. FORMS I-485, I-945, AND I-356

The proposed rule adds extensive information-collection requirements to Forms I-485, I-945, and I-356. Applicants must disclose detailed financial data, health insurance arrangements, household composition, and past benefit use. Members may request documentation from their Medicaid plan to prove insurance coverage or non-use of benefits.

Compliance Implication: Members may request documentation from health plans to prove insurance coverage or non-use of benefits. General Counsel should confirm that such documentation requests follow appropriate privacy and HIPAA channels, and that no misleading or legally risky explanations are provided to members about the rule or their benefit usage.

VII. COMMENT TOPICS THE AGENCY SEEKS INPUT ON

The agency seeks comments on the following areas.

A. Which Non-Cash Benefits Should Be Included

1. Whether certain non-cash public benefits (e.g., health benefits, housing assistance, nutrition programs) should count toward a public-charge determination (and if so, which ones).
2. How to define the threshold of benefit use (duration, frequency, value) that signals “dependence.”
3. Whether receipt of benefits by other household members (rather than the applicant) should be considered.

B. Definition of “Public Charge” / “Dependence”

1. How the term “likely at any time to become a public charge” should be defined or clarified.
2. What weight should be given to “primary dependence on government support” versus other factors.
3. How “dependence” should be operationalized (asset depletion, benefit use over time, lack of resources, etc.).

C. Evidence & Documentation Requirements

1. What evidentiary standards applicants should meet (income, assets, liabilities, credit history, employment, insurance, benefit use).
2. How far back and how detailed documentation needs to be (household composition, benefit history, insurance status).
3. Whether and how private health insurance coverage should weigh in as a positive factor or offset other risks.

D. Factor Weighting in the Totality-of-Circumstances Test

1. How to weigh negative factors (e.g., receipt of benefits, poor health, lack of insurance, limited skills/ education, large dependents) and positive factors (e.g., high income, significant assets, private insurance, strong employment history).
2. Whether certain factors should be “heavily weighted” or carry presumptive significance.
3. How to treat mixed factors (e.g., use of benefits + strong employment) in the balancing process.

E. Bond Regime / Public Charge Bonds

1. Under what circumstances a public-charge bond should be required.
2. What counts as “breach” of a bond, what are appropriate cancellation or release criteria, and what monitoring/enforcement mechanisms should apply.
3. How sureties should function, and whether benefit receipt by the applicant should trigger automatic breach or discretionary review.

F. Information-Collection Burden / Form Revisions

1. The estimated burden hours for applicants and sponsors in responding to new form requirements (e.g., expanded fields for assets, liabilities, benefit history, insurance).
2. Whether the forms (e.g., I-485, I-945, I-356) appropriately capture the proposed data without unnecessary complexity.
3. How to streamline or reduce duplication while maintaining integrity of the determinations.

G. Implementation & Transition Provisions

1. How to transition from the current rule to the proposed rule for pending applications, benefit use records, and bond postings.
2. Whether a phased implementation or grandfathering should apply, and how to treat applications filed before the effective date. 3.
3. Whether exceptions or carve-outs should apply to vulnerable populations (e.g., children, immigrants with disabilities, older applicants).

H. Impact on Vulnerable Populations / Equity Considerations

1. How the proposed rule might affect immigrant children, immigrants with disabilities, older individuals, or mixed-status households.
2. Whether the rule would have disparate impact on certain racial/ethnic groups, or income/education strata, and how to mitigate such risks.
3. How chilling effects (fear of benefit use) should be considered in regulatory design and public health/ health-insurance access contexts.