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Summary of Select Health Care Bills from House Energy and Commerce Committee Markup

On July 20-21, 2026, the House Energy and Commerce Committee held a markup that included several pieces of legislation related to Medicare Advantage, health care price transparency, and illicit drugs. The Improving Seniors’ Timely Access to Care Act, along with several other bills, were incorporated by an amendment into the larger Lower Costs, More Transparency Act. All the bills passed unanimously, except for the Prices on the Wall Act. Democratic members of the Committee opposed this bill because of concerns that the bill’s requirements would cause confusion for patients and deter them from seeking care. You can see a list of select bills included in the markup below, along with any notable discussion and the vote tallies.

OPENING STATEMENTS

SELECT LEGISLATION INCLUDED IN THE MARKUP

H.R. 2004, Tyler’s Law (Reps. Ted Lieu (D-CA-36) and Robert Latta (R-OH-5)), to direct the Secretary of Health and Human Services to issue guidance on whether hospital emergency departments should implement fentanyl testing as a routine procedure for patients experiencing an overdose.

  • The bill passed out of Committee by a vote of 46-0

H.R. 9390, the Prices on the Wall Act (Rep. Mariannette Miller-Meeks (R-IA-2)), to require hospitals, ambulatory surgical centers, and labs to post the discounted cash price in dollar amount on the wall for each service they provide.

  • Ranking Member Pallone stated that while he supports price transparency, he has strong concerns that implementation of the bill will be impractical, will cause more confusion for patients, and will deter patients from seeking care. Ranking Member Pallone highlighted H.R. 9393, the Lower Costs, More Transparency Act, as a more useful approach to price transparency.
  • The bill passed out of Committee by a vote of 24-21, along party lines, with Republicans voting for the bill and Democrats voting against it.

H.R. 9393, the Lower Costs, More Transparency Act of 2026 (Reps. Guthrie (R-KY-2) and Pallone (D-NJ-6)), to require hospitals, surgical centers, labs, and imaging providers to post prices and require health plans to disclose negotiated rates, cost-sharing estimates, and pharmacy benefit manager (PBM) spread pricing.

  • Chairman Guthrie offered an amendment, which was adopted by voice vote, to include the following legislation as part of this bill:
    • H.R. 9397, the Premium Transparency Act (Reps. August Pfluger (R-TX-11) and Nathanial Moran (R-TX-1)), to ensure health insurer accountability through publishing of overhead costs and claim payments.
    • H.R. 9396, the Prior Authorization Accountability Act (Rep. Craig Goldman (R-TX-12)), to require insurers to display which services were subject to prior authorization, the percentage of requests approved or denied, and the average amount of time between the request submission and determination.
    • H.R. 3514, Improving Seniors’ Timely Access to Care Act of 2025 (Reps. Mike Kelly (R-PA-16) and Suzan DelBene (D-WA-1)), to require plans to establish, and evaluate the implementation of, an electronic prior authorization.
    • H.R. 9392, the Medicare Advantage Cost Transparency Act (Reps. Diana DeGette (D-CO-1) and John Joyce (R-PA-13)), to require the inclusion of certain information in Medicare Advantage encounter data.
    • H.R. 5243, to require each Medicare Advantage plan to submit eligibility for supplemental benefits, types of benefit categories offered, and data on utilization of and payments for such benefits (Rep. Jennifer McClellan (D-VA-4)).
  • The amendment pushed back dates for certain provisions within these bills. For example, the amendment changed the Improving Seniors’ Timely Access to Care Act so the prior authorization requirements would be in effect for any applicable item or service during a plan year beginning on or after January 1, 2029, instead of January 1, 2028, for the electronic prior authorization program and January 1, 2027, for the transparency requirements.
  • Rep. Jake Auchincloss (D-MA-4) spoke positively of the amendment but requested that the Committee consider more pharmacy benefit manager (PBM) reforms.
  • Rep. John James (R-MI-10) offered an amendment to include H.R. 5582, the Patients Deserve Price Tags Act, as he believes that would improve price transparency for consumers more than H.R. 9393. However, the amendment was withdrawn.
  • The Lower Costs, More Transparency Act, as amended by Chairman Guthrie, was passed out of Committee by a vote of 45-0.
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Summary of Hearings on Pharmaceutical Supply Chain Security and Biomedical Innovation

On July 15, 2026, the House Select Committee on China, the House Energy and Commerce Health Subcommittee, and the Senate Aging Committee held hearings on the Federal Research Security Enterprise, the role of the Food and Drug Administration (FDA) in biomedical innovation, and foreign control of America’s drug supply. The hearings provided useful context on how members of these committees view the issues surrounding drug development and the threats posed by overreliance on foreign countries for the nation’s pharmaceutical supply chain.

HOUSE SELECT COMMITTEE ON CHINA HEARING ON THE FEDERAL RESEARCH SECURITY ENTERPRISE

Opening Statements

Witness Testimony

Member Discussion

Throughout the hearing, members from both parties expressed concerns that the Chinese Communist Party is exploiting American taxpayer-funded research by leveraging universities, labs, and researchers to accelerate their own developments. Questions centered around research security protocols and the impact of funding and workforce cuts.

Research Security Protocols

Republicans focused on how the Department of Energy (DOE), National Institutes of Health (NIH), and National Science Foundation (NSF) utilize the Restricted Entity List to protect American advancements from foreign entities. Chairman John Moolenar (R-MI-2) opened by asking the witnesses about the current policies at their respective agencies for ensuring federal funding does not fund research involving entities on the list. Dr. Keiser described NSF’s Dear Colleague Letter from July 8 notifying the research community of a forthcoming policy to prohibit entities from using NSF funds to collaborate with entities on the restricted parties lists. However, Dr. Keiser said they are waiting on the comment period to finalize before moving forward. Dr. Valdez and Mr. Ison explained that NIH and DOE do not have their own policy, but they are actively reviewing NSF’s and have a series of risk mitigations in place. Rep. Darin LaHood (R-IL-16) and Rep. Ashley Hinson (R-IA-2) asked Mr. Ison to go into more detail about the current DOE guidance in place. He explained that they use physical and cyber security, counterintelligence, and a layered approach to assess conflict of interest and prior commitments. Mr. Ison further stated that they have an escalation clause to bring any findings to the correct federal office should they find high-risk influence.

Funding and Workforce

Democrats largely used their time to highlight funding and workforce cuts at NSF, DOE, and NIH. Ranking Member Ro Khanna (D-CA-17) and Rep. Tom Suozzi (D-NY-3) asked whether the witnesses were concerned about workforce and funding cuts affecting their agencies. Dr. Keiser explained that NSF has had 5 employees choose to leave since 2024, and they are currently working on rebuilding and ensuring all the research community takes responsibility for safe research practices. Dr. Valdez stated that NIH security team has not experienced any cuts, but she understands there have been cuts elsewhere. Mr. Ison explained DOE is executing the President’s budget and is adequately addressing security concerns.

HOUSE ENERGY AND COMMERCE HEALTH SUBCOMMITTEE HEARING ON FDA’S ROLE IN BIOMEDICAL INNOVATION

Opening Statements

Witness Testimony

Member Discussion

There was bipartisan support for increasing patient access to clinical trials as well as concerns about the impacts of drug research and development overseas. There was also bipartisan concern raised about uncertainty at the FDA and how it may be hurting pharmaceutical innovation.

Risks of Reduced US Innovation

There were bipartisan concerns raised about the impacts of drug research and development moving overseas, specifically to China. Full Committee Chairman Brett Guthrie (R-KY-2) asked what was risky about the US failing to remain competitive in clinical trials. Dr. Verst highlighted that while clinical trials are needed, the US also needs to encourage translational science and collaboration with biotech companies to ensure research and development remains domestic. Full Committee Ranking Member Frank Pallone (D-NJ-6) asked how important it was for the US to support biomedical innovation. Dr. Hwang highlighted that almost every new drug application includes research supported by the NIH and that increased Chinese investment will shift clinical trials overseas. Rep. Buddy Carter (R-GA-1) wanted to know which policies can ensure the US holds on to its competitive edge. Dr. Verst highlighted Operation TrialBlazer, a plan from the Department of Health and Human Services (HHS) to maintain U.S. leadership in early clinical research and development, and the importance of ensuring cooperative work across federal agencies.

Health Subcommittee Vice Chair Diana Harshbarger (R-TN-1) and Rep. Kim Schrier (D-WA-8) were especially worried about the effects of foreign-generated clinical data on drug safety and development. Dr. Hwang noted that foreign governments often have different data standards and that the FDA should be empowered to inspect foreign clinical sites to ensure US data standards are upheld. Ms. Winckler highlighted that when data is collected domestically, local researchers have a much better understanding of the product and better control of data procedures. Mr. Bollyky shared that foreign data needs to be scrutinized and held to high standards.

Clinical Trials

There was bipartisan support for increasing patient access to clinical trials, especially for those from rural areas and underrepresented populations. Subcommittee Chairman Morgan Griffith (R-VA-9) asked how to get more rural care sites involved in clinical trials. Ms. Winckler emphasized the positive impacts of hub-and-spoke models in allowing rural providers to engage their patients in clinical trials without many of the administrative burdens that follow trial design, as well as the potential positive impacts of remote patient monitoring technologies.

Reps. Raul Ruiz (D-CA-25) and Robin Kelly (D-IL-2) wanted to highlight the importance of diverse patient populations in clinical trials and how to best ensure minority communities are represented. Ms. Winckler shared that often the challenge is that community providers are not aware of what clinical trials their patients are eligible to participate in. Dr. Verst emphasized that diversity in clinical trials is critical for good science and results in increased success for drugs and that community physicians need increased support for improving the process of referring their patients to potential clinical trial investigators. Dr. Kowalski highlighted that Breakthrough T1D mandates representative trials with clear methods to ensure representation as part of its grant-agreement process. Rep. Kat Cammack (R-Fl-3) questioned how to improve the underrepresentation of women in clinical trials. Ms. Winckler suggested that clinical trial designs should be clear about how sponsors plan to address potential sex-based differences in their participant mix. Rep. Troy Balderson (D-LA-2) asked the panel what actions they would like to see Congress take to improve enrolling patients in clinical trials. Dr. Verst emphasized that guidance on patients’ access and standard of care for clinical trials, as well as the need for simple trial designs, are the most critical steps that Congress could take.

Federal Rulemaking

Multiple Democratic members took the opportunity to express concerns about the potential impacts of a rule proposed by the Office of Management and Budget (OMB) that expands agencies’ authority to suspend or terminate discretionary grant awards if it is determined that the grant no longer aligns with agency priorities or national interest. Subcommittee Ranking Member Diana DeGette (D-CO-1), as well as Reps. Lori Trahan (D-MA-3) and Troy Carter (D-LA-2) all asked witnesses to explain how this proposed rule could affect the grantmaking and peer review process. Dr. Kowalski highlighted that merit-based peer review is imperative for science and drives clinical benefits. Dr. Hwang shared that the proposed rule could potentially disrupt current clinical trials and could make it much harder for international collaboration and argued the proposed rule should be withdrawn.

FDA Uncertainty and the Impact on Drug Development

Members highlighted the ongoing uncertainty at the FDA. Rep. Debbie Dingell (D-MI-6) asked Dr. Kowalski if companies shared concerns about getting new therapies approved by the FDA. Dr. Kowalski shared that he is aware of multiple companies making contingency plans to get therapies approved in other countries if they cannot reach agreements with FDA regulators.

Reps. Tom Kean (R-NJ-7), Jake Auchincloss (D-MA-4), and Kevin Mullin (D-CA-15) asked for witness input on how to improve the FDA and modernize FDA processes. Ms. Winckler said we should encourage use of and conversations with patients about clinical trial endpoints as well as clarifications from the FDA on how to operationalize hub and spoke models. Ms. Winckler also emphasized the need for consistent messaging across the FDA, Congress, and stakeholders about what is expected during the drug development process. Dr. Verst shared that biotech companies are looking for greater certainty, clarity, and guidance on FDA processes.

Other Topics
  • Rep. John Joyce (R-PA-13) discussed H.R. 9000, the SCREEN for Type 1 Diabetes Act, which would help ensure patients are properly screened for Type 1 diabetes. Dr. Kowalski voiced his support for the bill.
  • Rep. Nick Langworthy (R-NY-23) asked about opportunities to reduce the use of animal models and encourage the adoption of new approach methodologies (NAMs). Dr. Verst shared that NAMs can speed drug development and that the FDA should provide guidance on their use.

SENATE AGING COMMITTEE HEARING ON FOREIGN CONTROL OF AMERICA’S DRUG SUPPLY CHAIN

Opening Statements

Witness Testimony

Member Discussion

Throughout the hearing, members from both parties expressed alarm that foreign ownership and investment, particularly from China, have created hidden vulnerabilities across the pharmaceutical and biotechnology supply chain, extending beyond visible drug ingredients to clinical trial data, corporate ownership structures, and biomanufacturing capacity. Committee Chairman Rick Scott (R-FL) and Committee Ranking Member Kirsten Gillibrand (D-NY) both emphasized that current law is not sufficient to identify these risks, and members discussed the newly introduced Pharmaceutical Investment Oversight and Accountability Act as a first step toward addressing the gap.

Foreign Investment and CFIUS Oversight Gaps

Chairman Scott, Ranking Member Gillibrand, and Sen. Elizabeth Warren (D-MA) announced the Pharmaceutical Investment Oversight and Accountability Act, which would require the Federal Trade Commission (FTC) and the Committee on Foreign Investment in the United States (CFIUS) to report annually to Congress on foreign investment in pharmaceutical manufacturing and related technologies. Ms. Nikakhtar testified that CFIUS jurisdiction does not extend to most greenfield investments and joint ventures, board seats obtained without an equity stake, or licensing and data-access deals that involve no investment, and that many qualifying transactions are simply never filed for review. She recommended a presumption of denial for Chinese biotech transactions that do fall under CFIUS jurisdiction and urged Congress to pass legislation to close the greenfield and joint-venture gap. Senator Warren pressed Ms. Nikakhtar on why biotech acquisitions continue to escape review despite 2018 reforms expanding CFIUS’s scope; Ms. Nikakhtar attributed the gap to voluntary filing, executive branch self-limiting of its own authority, and China’s use of legal counsel to structure deals around CFIUS jurisdiction.

Supply Chain Dependency and Weaponization Risk

Chairman Scott and Mr. Ezell highlighted that China controls 94% of the key starting materials (KSMs) for amoxicillin, 74% of heparin, and effectively all of the KSMs for common blood pressure medications, and that nearly 700 medicines approved for use in the United States depend on at least one upstream input produced solely in China. Dr. Doshi warned that “Made in America” labeling can mask upstream dependency on Chinese-sourced KSMs and active pharmaceutical ingredients (APIs). Mr. Ezell, Ms. Nikakhtar, and Mr. You each warned that China is positioning these chokepoints as leverage over the United States, comparable to its dominance in rare earths and critical minerals, and could restrict supply at a time of its choosing.

Biotech Innovation and Clinical Trial Data

Mr. You testified that clinical trial data generated by American patients in FDA-authorized trials can legally flow to Chinese-linked companies with no federal agency able to stop it, citing FDA-cleared Chinese CAR-T cell therapy startups whose U.S. trial data feeds back into Chinese drug development while U.S. companies license and Medicare reimburses the resulting products. Dr. Doshi added that China’s looser regulatory requirements for first-in-human trials let American pharmaceutical companies obtain de-risked clinical data faster from Chinese assets than from domestic ones, a dynamic that has driven $53 billion in U.S. licensing deals with Chinese biotech over the past five years that now account for one-third of new drug pipelines. Mr. Ezell and Mr. You both flagged Chinese “brand obfuscation,” citing BGI’s Complete Genomics and WuXi AppTec as companies with undisclosed ties to the Chinese Communist Party (CCP) and the People’s Liberation Army (PLA) that operate within the U.S. pharmaceutical supply chain.

Legislative and Policy Responses

Senator Warren discussed her broader Pharmaceutical Supply Chain Defense and Enhancement Act, which would pair the Pharmaceutical Investment Oversight and Accountability Act’s investment transparency requirements with greater use of federal procurement power to build sustained domestic demand for allied-sourced medicines. Witnesses recommended complementary measures, including passage of the Biotech Investment National Security Act (BINSA), expanded export controls on biological materials and data, “clear labels” legislation to expose upstream KSM and API dependencies, tariff and reimbursement incentives favoring allied inputs, and a Manufacturing USA institute for critical minerals and APIs. Several witnesses urged deeper coordination with allies, including South Korea, Mexico, and India, to diversify away from Chinese-controlled inputs.

Other Topics
  • Senator Warren asked how two recent Chinese decrees, 834 and 835, could affect U.S. regulators’ ability to inspect Chinese API facilities. Mr. Ezell warned the decrees create legal risk for any U.S. company operating in China and urged Congress to insist on continued inspection access and to properly resource the FDA’s foreign inspection program.
  • Senator Warren also asked which federal agency should be accountable for mapping foreign ownership across the drug supply chain. Dr. Doshi called for a White House-level coordinating body to combine FDA, Commerce, and Customs data, while Ms. Nikakhtar argued that any new designation authority should be structured, like CFIUS determinations, to be non-litigable.
  • Senator Jon Husted (R-OH) asked what the offshoring of pharmaceutical manufacturing has cost the United States in engineering and manufacturing talent, drawing a parallel to the semiconductor industry. Mr. Ezell and Ms. Nikakhtar agreed that the U.S. lost significant manufacturing talent and investor expertise in other sectors, but noted that biotech talent can still be rebuilt if reinvestment continues.
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Week Ahead: The Messi Calendar

Soccer fans had a Messi-filled weekend, and Congress is shaping up to have a messy week of its own. As congressional committees continue to work through legislation and nominations, House Republican leadership is looking to push a budget resolution, the NDAA, a stock trading ban, and a continuing resolution ahead of their August recess. But can they get it all done before the whistle blows? Let’s get into it. Welcome to the Week Ahead!

The Administration

The Centers for Medicare and Medicaid Services (CMS) is counting down to July 31, when the comment period for the interim final rule that implements the Medicaid work requirements put in place by the One Big Beautiful Bill Act closes. The rule’s provisions are legally in effect on that day (although states are not mandated to have their operational programs until January 1, 2027). 25 states, plus the District of Columbia, have challenged some of the agency’s interpretations of requirements under H.R. 1, the most notable being the narrow medical frailty exemption, arguing that the 2-part test goes beyond a plain language reading of the statute and puts vulnerable individuals with significant health care needs at risk of losing their coverage.

Meanwhile, the Trump administration is continuing its focus on the visa system, imposing more restrictions on the green card process. The State Department is considering adding a $100,000 bond to green card applications to “ensure immigrants are financially self-sufficient,” according to spokesperson Tommy Pigott. If the bond were to go into effect, it could be a significant barrier to nurses and medical technicians applying for a green card abroad as well as act as a deterrent for international medical graduates who apply outside the country. At the same time, the Department of Homeland Security has issued a final rule rescinding the 2022 regulation on public charge determinations that allowed authorities to consider only a green-card applicant’s use of cash benefits when determining whether the applicant would be a “public charge”. This change would mean that authorities could consider use of benefits, including Medicaid, in decisions about green card applications. Advocates have raised concerns that this would cause immigrants to avoid using programs like Medicaid, thus delaying care and ultimately forcing more individuals to rely on emergency room care.

The Senate

It’s a packed week for the Senate Committee on Health, Education, Labor, and Pensions (HELP). First up is the Committee’s executive session on a variety of health care bills on July 22. One of those bills is S. 4189, the INSULIN Act of 2026, which would cap the cost of insulin at $35 per month for individuals with private health insurance. This bipartisan bill is being co-led by Sen. Susan Collins (R-ME) and has eight other committee members as cosponsors. Also on the docket is S. 2355, the Patients Deserve Price Tags Act, which is being led by HELP Committee members Sens. Roger Marshall (R-KS) and John Hickenlooper (D-CO). While the House Energy and Commerce and Ways and Means Committees have passed a number of health price transparency bills, the Patients Deserve Price Tags Act stands apart mainly on employer access to claims data. Other bills being considered include legislation on country-of-origin prescription labeling, access to generic medications, and food safety.

On July 23, the Senate HELP Committee will be voting on the nominations of Dr. Erica Schwartz, to be Director of the Centers for Disease Control and Prevention (CDC), and Sean Kaufman, to be Assistant Secretary of Preparedness and Response (ASPR). During the nomination hearing on July 15, sparks flew as HELP Chairman Bill Cassidy (R-LA) pressed both nominees on their view of vaccines and whether they would be influenced by political pressures. Several senators on the committee, including Sens. Lisa Murkowski (R-AK), Andy Kim (D-NJ), Tim Kaine (D-VA), Tammy Baldwin (D-WI), and John Hickenlooper (D-CO), told reporters on July 16 they were undecided on how they will vote. This complicates the path forward as the nominees will need the support of all Republicans on the Committee if all Democratic members oppose their nominations.

Other Health Care Hearings This Week

  • July 22: Senate Indian Affairs Committee meeting to consider the nomination of Mark Cruz to be Indian Health Service Director

The House

House Republican leaders are hoping for a hat trick as they look to advance the resolution necessary for a third budget reconciliation package. The House Budget Committee has set up the shot by passing a resolution that calls for $95 billion in spending for the military, aid for farmers, and election measures. Although it also included a provision allowing for additional funding for the Health Care Fraud and Abuse Control Program, there were no instructions for the Committees with jurisdiction over Medicare and Medicaid. Despite the movement on the resolution, challenges still remain. These challenges include a thin majority in the House, limited floor time, and concerns from fiscal hawks who will want to offset the price tag, as well as from more moderate Republicans who may have issues with either funding tied to the Iran war or the election measures. And that’s just in the House. Some Senate Republicans, such as Sens. Rick Scott (R-FL) and Bill Cassidy (R-LA) have also voiced their concerns about the need for pay-fors.

At the same time, House Republicans have released the text for a Continuing Resolution (CR) that would fund the government at fiscal year 2026 levels through December 4, 2026. Speaker of the House Mike Johnson (R-LA-1) has plans to put the bill on the floor before they leave town. Although the CR does not include health care extenders (such as community health center funding and Medicare add-on payments) it does include funding for Indian Health Service staffing and facilities as well as  funding for the Supplemental Nutrition Program for Women, Infants, and Children (WIC), which is currently set to lapse on September 30, 2026. The House is also slated to consider thirteen health care bills. These include bills to reauthorize public health programs and to address needs for specific diseases and conditions. They also include a bill directing the Food and Drug Administration (FDA) to publish a final rule allowing non-animal testing in drug approvals, a bill clarifying Medicare payment rules for manual wheelchairs, and a bill allowing for the Secretary of Labor to suspend Federal Employees’ Compensation Act payments to medical providers convicted of fraud.

As the House deals with all this, the House Energy and Commerce Committee is holding a markup of various bills on July 20, including bills related to illicit drugs and health price transparency, that have passed out of the Health Subcommittee.

Other Health Care Hearings This Week

  • July 21: House Education and Workforce markup, including a bill to classify certain health care professionals serving in temporary roles as independent contractors
  • July 22: House Oversight Committee markup, including a bill to address concerns about certain pharmacy benefit manager (PBM) practices within the federal employee health insurance system

There You Have It

The World Cup has finally ended, with Spain emerging as the victors. Were you happy with the final game? Let us know. Make it a great week!

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Calendar Year 2027 Medicare Physician Fee Schedule Proposed Rule

On July 14, 2026, the Centers for Medicare & Medicaid Services (CMS) released the Calendar Year (CY) 2027 Medicare Physician Fee Schedule (PFS) Proposed Rule. The CMS press release can be found here. A fact sheet from CMS is available here. A separate fact sheet on the Medicare Shared Savings Program (MSSP) proposals can be found here. The 60-day comment period under the Administrative Procedure Act (APA) for the CY27 PFS proposed rule ends on September 14, 2026.

CONVERSION FACTOR

As part of the rule, CMS proposes a CY27 conversion factor (CF) of $33.17 for Alternative Payment Model (APM) participants, known as Qualifying Participants (QPs), a -1.19% decrease ($0.40) from the CY26 QP CF of $33.57. For non-qualifying participants (non-QPs), the aggregate proposed CF is $32.84, reflecting a -1.68% decrease ($0.56) from the CY26 non-QP CF of $33.40. A summary of the components of those aggregate payment updates is below.

  • Under the Medicare Access and CHIP Reauthorization Act (MACRA) of 2015, the statutory update for CY27 is 0.75% for QPs and 0.25% for non-QPs. These are the same bifurcated statutory updates that first took effect in CY26 and that are intended to incentivize clinician participation in Advanced APMs.
  • The one-year 2.50% CF increase provided by the One Big Beautiful Bill Act (OBBBA), which CMS refers to in the rule as the Working Families Tax Cut (WFTC) legislation, applies only to CY26 and expires at the end of this year. The expiration of that adjustment functionally imposes a 2.50% payment reduction under the PFS relative to CY26, absent further congressional action.
  • The proposed CFs also include an estimated positive 0.53% adjustment to account for proposed changes in the work relative value units (RVUs) for certain services. The combination of the statutory updates, the expiration of the WFTC increase, and the work RVU adjustment produces the net negative CF updates described above.

E/M VISITS FURNISHED DURING GLOBAL SURGICAL PERIODS

CMS proposes reducing payment when a separately identifiable office/outpatient evaluation and management (E/M) visit is furnished by the same physician (or a physician in the same group practice) on the same day as a procedure with a 0-, 10-, or 90-day global period. Under the proposal, the most expensive service (whether the surgical procedure or the E/M visit) would be paid at 100% of its rate, and all other surgical procedures or E/M visits furnished that day would be paid at 50%. CMS advanced a similar proposal in the CY19 PFS proposed rule but did not finalize it at that time. In the CY27 rule, the agency reiterates its view that efficiencies exist when the same physician or group furnishes an E/M service in conjunction with a global procedure and that the current methodology therefore duplicates payment.

E/M VISIT COMPLEXITY ADD-ON (G2211)

In the CY21 PFS final rule, CMS finalized separate payment for the office/outpatient E/M visit complexity add-on code, HCPCS code G2211. Implementation was delayed by statute and took effect for CY25. For CY27, CMS proposes two changes to this policy.

  • CMS proposes converting G2211 from a stand-alone add-on code into a modifier (placeholder modifier MOD1) appended to the associated E/M base code. The modifier would increase payment for the associated E/M code by 16% rather than providing a flat dollar amount, maintaining an equal percentage increase across all E/M levels.
  • CMS also proposes a second modifier (placeholder modifier MOD2) available only to practitioners participating in a Medicare Shared Savings Program (MSSP) Accountable Care Organization (ACO) or serving as Participant Providers in a Long-term Enhanced ACO Design (LEAD) Model ACO. The MOD2 modifier would increase payment for the associated E/M visit by 32% to recognize the additional costs of longitudinal care, including total cost of care accountability and aligned quality reporting. Use of MOD2 would be voluntary and billable for all beneficiaries served by the practitioner, not only ACO-assigned or ACO-aligned beneficiaries. Claims submitted with MOD2 would be included in MSSP beneficiary assignment calculations, historical benchmark expenditures, and performance year expenditures.

PRACTICE EXPENSE

CMS describes a multi-year effort to transition the practice expense (PE) methodology away from reliance on American Medical Association (AMA) survey data and toward more objective, routinely updated, and auditable cost data. The agency states that the surveys underlying current PE values suffer from low response rates and significant discrepancies with alternative empirical data sources. The CY27 rule contains several proposals in furtherance of that transition.

  • CMS proposes phasing out the portion of the PE methodology that anchors aggregate specialty-level PE RVUs to practice expense per hour (PE/HR) survey data from 2007 or earlier, known as the indirect practice cost index (IPCI). The phase-out would occur over a two-year transition, with half of the measured IPCI variation applied in the first year and none in the second year.

  • In place of the stabilizing effect of the old survey data, CMS proposes a new PE stabilization adjustment that would cap year-over-year increases or decreases in a code’s PE RVU at 5%. The cap would not apply to new, revised, or revalued codes, and it would be applied prior to the separate statutory phase-in that limits total RVU reductions to 19% per year.

  • CMS proposes allocating indirect PE using both work RVUs and clinical labor RVUs for all services, except codes with 010- and 090-day global periods. Under current policy, that combined allocation approach applies only to services billable with professional and technical components.

  • CMS proposes equalizing the facility and non-facility PE RVUs for nursing facility E/M visits (CPT codes 99304 through 99310, 99315, and 99316). This change addresses an unintended consequence of the site of service payment differential finalized in the CY26 final rule, under which payment for these visits varied based solely on whether the beneficiary was in a Part A skilled nursing facility stay.

  • CMS is seeking comment on the broader facility versus non-facility site of service differential, including how indirect costs vary for physicians employed by hospitals, health systems, or other entities. The agency specifically asks whether the current 50% indirect PE allocation for facility-based services is accurate for hospital-employed physicians or whether a lower allocation (potentially 0%) would be appropriate, and whether a new HCPCS modifier should be created to identify employed physicians.

REMOTE MONITORING

CMS proposes several changes to payment for remote physiologic monitoring (RPM) and remote therapeutic monitoring (RTM) services. The agency proposes requiring that RTM services be furnished only to established patients, requiring practitioners to furnish a separately reportable initiating visit in association with the onset of RPM or RTM services, and allowing payment only when the services are performed by clinical staff employed by the practice rather than by contractors. CMS also proposes updating the valuation of these services to reflect its understanding that monitoring devices may now be available at lower cost than initially estimated. Finally, CMS is seeking comment on bundling the RPM and RTM CPT codes into four new HCPCS G-codes, an approach the agency states would address recommendations from recent HHS Office of Inspector General (OIG) reports.

GLOBAL SURGERY DATA COLLECTION

CMS proposes pausing the global surgery data collection required by section 523 of MACRA. The agency states that several years of collected data show that post-operative visits assumed within 10- and 90- day global surgical packages are frequently not occurring, even though providers continue to be paid for those visits under the current bundled payment policy. CMS also states that the current data collection requirements may impose undue burden on practitioners. CMS is posting a public-use file that displays imputed RVUs for 10- and 90-day post-operative visits using an arithmetic approach. The agency is soliciting comments on expanded data collection, alternative data sources, and revaluation strategies for global surgical services in future rulemaking.

LIMITS ON MEDICARE ELIGIBILITY FOR CERTAIN INDIVIDUALS

CMS proposes regulations implementing section 71201 of the WFTC legislation (OBBBA), which amended the Social Security Act to limit Medicare eligibility to four groups. Those groups are U.S. citizens or nationals, lawful permanent residents, individuals granted Cuban and Haitian entrant status, and individuals lawfully residing in the U.S. under a Compact of Free Association. The proposed regulations would incorporate the newly specified eligibility groups, establish procedures for terminating coverage for individuals found ineligible, provide applicable appeal rights, and set out enrollment options for individuals who later gain or regain eligibility.

MEDICARE PRESCRIPTION DRUG INFLATION REBATE PROGRAM

The rule proposes updates to the Part B and Part D drug inflation rebate programs established under the Inflation Reduction Act of 2022 (IRA). Among other items, CMS proposes clarifying which Consumer Price Index for All Urban Consumers (CPI-U) data are used to determine benchmark values for subsequently approved drugs when CPI-U data for the relevant month are unavailable, clarifying the definition of “first marketed date,” and clarifying that certain skin substitutes would not be excluded from the definition of a Part B rebatable drug. Separately, CMS proposes requiring providers and suppliers that are 340B covered entities to submit specified claim-level data elements to the Medicare Part D Claims Data 340B Repository for covered Part D drugs dispensed with a 340B discount, beginning with claims with dates of service on or after January 1, 2027.

CLINICAL LABORATORY FEE SCHEDULE (CLFS)

CMS proposes conforming regulatory changes to implement CAA, 2026 amendments to the CLFS. The changes would update the data collection and reporting requirements for clinical diagnostic laboratory tests (CDLTs) as well as the phase-in of payment reductions based on private payor rate data. The next data reporting period for CDLTs that are not advanced diagnostic laboratory tests runs from May 1, 2026, through July 31, 2026, based on applicable information collected from January 1, 2025, through June 30, 2025. Beginning in CY27, payment reductions resulting from the private payor rate data would be subject to a phase-in cap of up to 15% per year through CY29.

AMBULATORY SPECIALTY MODEL (ASM)

The CY26 PFS final rule established the ASM, a mandatory alternative payment model administered through the CMS Innovation Center that focuses on specialists treating Medicare beneficiaries with heart failure and low back pain. The model runs from 2027 through 2031, with the first performance year beginning January 1, 2027, and payment adjustments applied two years after each performance year. Participating specialists are assessed individually (at the Taxpayer Identification Number/National Provider Identifier (TIN/NPI) level) across four performance categories, which are quality, cost, improvement activities, and Promoting Interoperability. Performance relative to peers treating the same condition determines two-sided adjustments to Medicare Part B payments ranging from -9% to +9% in the first two payment years (2029 and 2030) and gradually increasing to 12% by the final payment year (2033).

In the CY27 rule, CMS proposes a series of technical refinements to the model that would take effect at its start. Key proposals include adding an administrative claims-based imaging quality measure for low back pain, replacing the low back pain patient-reported outcome measure with a functional status outcome process measure, adjusting quality measure benchmarking and scoring policies, adding a quality scoring incentive for voluntary submission of patient-reported outcome data, incorporating a rural scoring adjustment, and aligning the model’s Promoting Interoperability requirements with proposed MIPS changes. CMS also proposes participant-level flexibilities, including exceptions for participants affected by TIN changes or specialty redesignations, an option to terminate participants under certain circumstances, an option to submit improvement activities data at the individual or group level, and revisions to collaborative care arrangement requirements.

QUALITY PAYMENT PROGRAM (QPP)

The proposed rule includes significant changes to the QPP. Most notably, CMS proposes sunsetting traditional Merit-based Incentive Payment System (MIPS) reporting beginning with the CY29 performance period (2031 payment year). At that point, MIPS Value Pathways (MVPs) would become the only MIPS reporting option for clinicians not reporting through the APM Performance Pathway. Additional QPP proposals include:

  • Adding three new MVPs focused on diabetic disease, hypertension, and hospitalist care, which would bring the MVP inventory to 30 pathways.
  • Establishing a CY27 quality measure inventory of 180 measures, reflecting 20 measure removals, 10 measure additions, and 43 substantive changes. CMS also proposes creating a new “MIPS core measure” designation and requiring clinicians to report at least one core measure in place of the current outcome or high priority measure requirement, with an exemption for small practices.
  • Updating the improvement activities inventory by adding six new activities (including a new Advancing Health and Wellness subcategory aligned with the Make America Healthy Again initiative), modifying five activities, and removing eleven activities.
  • Revising the Promoting Interoperability category, including removing the Security Risk Analysis measure and restructuring the Electronic Prior Authorization measure so that it is optional (and worth bonus points) for CY27 before becoming required in CY28 alongside a new required Electronic Prior Authorization for Prescription Drugs measure.
  • Applying Qualifying Participant (QP) status at the TIN/NPI level under which the clinician achieves that status and modifying the QP thresholds in accordance with the CAA, 2026.

MEDICARE SHARED SAVINGS PROGRAM (MSSP)

The CY27 PFS proposed rule includes numerous updates to the MSSP, including:

  • Rebalancing financial incentives across risk tracks, including raising the shared savings rate for Level E of the BASIC track from 50% to 60%, lowering the maximum weight of the positive regional benchmark adjustment for ENHANCED track ACOs from 50% to 35%, raising the prior savings adjustment scaling factor from 50% to 75%, risk adjusting the 5% cap on upward benchmark adjustments, and adding a new growth adjustment that rewards ACOs for bringing clinicians and beneficiaries new to value-based care into the program.
  • Adding a guardrail to the Accountable Care Prospective Trend (ACPT) component of the benchmark update factor so the ACPT is no more than 1 percentage point below (or 1.5 percentage points above) observed national expenditure growth. The lower guardrail would apply retroactively to ACOs with 2024 through 2026 start dates, and CMS is delaying performance year 2025 financial reconciliation until November 2026 to implement the change if finalized.
  • Allowing ACOs, upon CMS approval of an implementation plan, to reduce or eliminate Part B cost sharing for beneficiaries beginning April 1, 2027 (excluding durable medical equipment, prosthetics, orthotics, supplies, and prescription drugs), while removing the prepaid shared savings payment option due to low uptake.
  • Modifying the beneficiary assignment methodology for performance year 2028 and beyond, including excluding primary care charges billed through non-ACO taxpayer identification numbers from assignment calculations.
  • Streamlining quality and certified electronic health record technology (CEHRT) requirements, including extending the MIPS Clinical Quality Measures collection type and its reporting incentive, creating a new Medicare electronic Clinical Quality Measure (eCQM) collection type, reducing the APP Plus quality measure set to eight measures, and replacing the current Promoting Interoperability reporting requirement with a simplified three-option CEHRT use attestation.

REQUESTS FOR INFORMATION (RFIS) AND COMMENT SOLICITATIONS

As part of the proposed rule, CMS issued several RFIs and comment solicitations, seeking stakeholder feedback on issues including:

  • How CMS might redesign primary care valuation to support a shift toward preventive medicine, covering three topics, which are reconsidering relative primary care payment under the PFS, understanding the payment implications of incorporating technology into primary care, and establishing prospective primary care payment within the MSSP and potentially Original Medicare more broadly.
  • How to address duplicate laboratory testing and imaging resulting from siloed diagnostic results, including potential actions to improve result sharing and interoperability across care settings.
  • Whether and how the facility versus non-facility site of service differential should be refined, including the appropriate indirect PE allocation for hospital-employed physicians.
  • How to improve data collection and valuation accuracy for global surgical packages, including potential revaluation strategies for future rulemaking.
  • Whether the RPM and RTM code families should be restructured into bundled HCPCS G-codes.
  • The anticipated timeline, milestones, and implementation considerations for transitioning to FHIR-based digital quality reporting across the QPP and other CMS quality programs.
  • The influence of the American Medical Association’s (AMA) CPT coding system and RUC valuation process on physician payment policy, including questions about the AMA’s licensing monopoly, conflicts of interest in service valuation, and potential alternatives for data collection and payment recommendations.
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Crunch Time

There are only 8 more days left with both the House and the Senate in session before the August recess, and Congress has a lot on its plate. The top of the list includes fiscal year 2027 appropriations bills, Republican hopes for Reconciliation 3.0, and dealing with renewed conflict in Iran. Overshadowing it all is the unexpected death of Senate Budget Committee Chairman Lindsey Graham (R-SC). Let’s get into it. Welcome to the Week Ahead!

The Administration

The Department of Health and Human Services (HHS) postponed the U.S. Preventive Services Task Force’s meeting for the fourth time in the past year, citing an “unprecedented” volume of applications from prospective members. The delay follows a broader overhaul of the task force’s membership. In May, HHS removed chair John Wong and vice chair Esa Davis, and the agency has been soliciting nominations for a new slate of members. Given the pattern of repeated delays over the past year, it will be important to see if HHS names new task force members or sets a new meeting date in the coming weeks, and whether congressional Democrats and advocacy groups, who have previously pushed back on changes to the task force, respond to this latest postponement.

Meanwhile, the White House is once again focusing on the H-1B visa program with new a Department of Labor (DOL) investigation into visa fraud. Vice President Vance announced the new effort, following court challenges to the $100,000 H-1B fee imposed by the Trump administration in September 2025. The initiative will focus on checking underpayment of foreign workers, layoffs of qualified Americans, and labor trafficking. While much of the focus has been on the information technology industry, it will be important to pay attention to how the investigation impacts the health care workforce, which includes a significant number of H-1B visa holders.

The Senate

The passing of Sen. Graham has major implications for the Senate’s agenda, as he chaired the Senate Budget Committee, which would be responsible for drafting instructions for a third reconciliation bill. Sen. Ron Johnson (R-WI) is the most senior Republican on the Committee without an existing chairmanship, is next in line for the post and his office has said he is “prepared to serve.” Sen. Johnson is a staunch fiscal hawk who previously called for cuts during the debates over the first reconciliation package. This suggests he may demand cuts to offset the price tag of a third package. Sen. Graham’s passing also means that, until his temporary replacement is named and until Sen. Mitch McConnell (R-KY) returns, the Republican majority is down to 51 Senators.

The Senate Health, Education, Labor, and Pensions (HELP) Committee is looking to start filling in the gaps in federal health policy leadership with a nomination hearing on July 15. Up for review are Sean Kaufman to be Assistant Secretary for Preparedness and Response (ASPR) and Dr. Erica Schwartz to be Director of the Centers for Disease Control and Prevention (CDC). The nomination hearings indicate that HELP Committee Chairman Bill Cassidy (R-LA) is willing to work with the Trump administration to move forward with their picks despite losing his primary in May. Also, on his to-do list are nomination hearings for the US Surgeon General and the yet-to-be-announced Director for the Food and Drug Administration (FDA). And that’s assuming that Dr. Schwartz lasts longer than her predecessors’ 29 days!

We are also tracking a July 14 Senate Judiciary Committee hearing on how the debate over what products are eligible for patents impacts genetic medicine. Our conversations on the Hill indicate that the hearing will be focused on S. 1545, the Patent Eligibility Restoration Act of 2025 (PERA). If this bill were to eventually become law it would make it easier for diagnostic methods, genetic testing applications, and personalized-medicine inventions built around genetic material to be patented.

Other Health Care Hearings This Week

  • July 15: Senate Armed Services Personnel Subcommittee hearing on the Tricare pharmacy program
  • July 15: Senate Aging Committee hearing on foreign ownership and control in America’s drug supply chain

The House

House Republican leadership is returning to Washington after failing to advance appropriations bills before the July 4th recess. The House Rules Committee is scheduled to consider a rule on July 13 that would include the national security and Department of State appropriations legislation (along with a Veterans bill with a variety of health care provisions). However, it remains to be seen if House Republican leadership can overcome the efforts by some House Republicans to halt floor action unless progress is made on the SAVE America Act. At the same time, there continues to be interest in reconciliation 3.0 in the House, with some calling for provisions to enact health care priorities such as expanding access to health savings accounts and strengthening federal price transparency requirements. House Speaker Mike Johnson (R-LA-4) reportedly met with members of the House Budget Committee on July 12. Despite this movement, hurdles such as a thin Republican majority and dwindling days on the calendar make a third reconciliation package a tall order.

While the House as a whole deals with all these priorities and more, the House Energy and Commerce Health Subcommittee is set to examine America’s leadership in biomedical innovation and the FDA’s role in drug development on July 15. Based on our conversations on the Hill, we expect the hearing to include a focus on how the US can improve the drug research and approval process to be competitive with China, as well as drug user fee reauthorization.

Other Health Care Hearings This Week

  • July 14: House Education and Workforce Committee hearing on the impact of DEI on medical schools
  • July 15: House Select Committee on China hearing on the federal research security enterprise

There You Have It

Movies are a great way to take shelter from the summer heat, and July is setting up to have a lot of options between the new live-action Moana, The Odyssey, the next Spider-Man, and more. Is there one that you are looking forward to? Let us know. Make it a great week!

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