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We’ve reached the week of the March 14 deadline for when the current continuing resolution to keep the government open expires. Meanwhile, the House and Senate remain far apart on budget reconciliation, the Senate continues churning President Trump’s nominees, and the White House seeks to clarify Elon Musk’s role in the administration. So, with that, let’s get into it. Welcome to the Week Ahead!
The Administration
To say Elon Musk’s Department of Government Efficiency (DOGE) has disrupted Washington is about as much of an understatement as saying Elon Musk is a car salesman. From prompting mass protests to filling up the chairs in town hall meetings across the country, DOGE is making itself known. But there are still a lot of questions about what DOGE’s role is. President Trump sought to clarify that role with a Truth Social post in which he praised DOGE but also said he was instructing DOGE to work with cabinet secretaries to be “very precise” about future staffing decisions, stating a preference for the “scalpel” rather than the “hatchet.”
We don’t know how things will play out if Musk and cabinet secretaries disagree about distinguishing the scalpel from the hatchet. We do know that DOGE continues to disrupt things in Washington, and we don’t expect that to change. Case in point, the Department of Health and Human Services (HHS) sent most of its employees a $25,000 buyout offer. Responses are due March 14.
In non-DOGE news, we are watching the Office of Management and Budget (OMB), which as of March 7, has received 7 rules including hospital inpatient, inpatient psych, inpatient rehab, skilled nursing, hospice, Medicare Advantage, and the Affordable Care Act Health Insurance Exchange Marketplace. That last one could set off a firestorm if it makes major changes to the Marketplace that are seen as weakening protections put in place by the Biden administration to help people sign up, or stay on, ACA plans.
The Senate
All eyes are on Dr. Mehmet Oz’s nomination hearing on March 14 for the Centers for Medicare and Medicaid Services (CMS) Administrator. Expect questions about DOGE and access to agency data to be a top question from Democrats. Additionally, Medicare Advantage should come up, given his past support of the program as a Senate candidate.
The Senate HELP Committee is cranking through its noms. The Committee will vote on Dr. Jayanta Bhattacharya for National Institutes of Health (NIH) and Dr. Martin Makary for the Food and Drug Administration (FDA) on March 13, giving them a shot at being confirmed by the Senate before their recess week of March 17. Additionally, the Committee will consider the nomination of Dr. David Weldon to be Director of the Centers for Disease Control and Prevention (CDC) on March 13. Watch for vaccine policy to dominate this hearing, including a review of Dr. Weldon’s past statements about the possible connections between certain vaccines and autism.
Another hearing to watch this week is the Senate Special Committee on Aging March 12 hearing on “breaking the cycle of senior loneliness.” Pay attention to any comments related to the administration’s recent Medicaid bulletin pulling back on health-related social needs.
The House
House Republicans unveiled bill text for a continuing resolution (C.R.) to keep the government funded through the rest of the fiscal year (September 30). The bill also extends certain health care policies, including telehealth flexibilities, through September 30. Notably, the bill does not include anything to address physicians’ concerns about Medicare reimbursement cuts. The House Rules Committee is scheduled to meet to consider the bill on March 10, and House Speaker Mike Johnson (R-LA) is planning to have the House vote on the bill on March 11. The Speaker can only lose one Republican if Democrats unite against the bill. Two Republicans, Reps. Thomas Massie (R-KY) and Tony Gonzalez (R-TX), have expressed opposition to the C.R., but the bill does have the support of House Freedom Caucus Chair Andy Harris (R-MD). House Democratic leadership has expressed opposition to the bill, but individual Democrats could decide to vote for the bill if the alternative is shutting down the government.
A bill also must pass in the Senate with 60 votes before it makes it to the President’s desk. A big question that remains unanswered is if passage of a “full-year C.R.” triggers mandatory spending cuts under the Fiscal Responsibility Act (FRA) of 2023 (1% below FY 2023 appropriations). It will be up to the Congressional Budget Office (CBO) and the Office of Management and the Budget (OMB) to report on any breaches of the FRA’s enforcement caps.
We are also tracking some House health care hearings scheduled for March 11. The House Ways and Means Health Subcommittee is holding a hearing on access to post-acute care and the House Veterans’ Affairs Health Subcommittee is a holding a legislative hearing on 15 bills.
There You Have It
NCAA basketball’s Selection Sunday is coming up on March 16. Who are you rooting for? Will you be filling out a bracket? Let us know. Make it a great week!
Medicaid, the joint federal and state program that provides health care for low-income individuals, has long been a critical part of the U.S. health care system. Over the years, states have explored various mechanisms to increase the flexibility and efficiency of Medicaid spending. In 2016, the Centers for Medicare and Medicaid Services (CMS) created a new option to pay providers according to specific rates known as directed payments. Since 2016, states have greatly increased their use of directed payments. Now, lawmakers are asking: Should Medicaid directed payments continue as they are, or do they need stricter oversight?
History of Medicaid Directed Payments
In 2016, CMS created directed payments to allow states to pay providers according to specified rates and methods. The payments were originally designed to require Managed Care Organizations (MCOs) to pay providers a certain amount. In practice, directed payments allow Medicaid funds to be used in ways that are not directly tied to traditional reimbursement methods, such as fee-for-service (FFS). This flexibility has enabled states to target resources where they believe they will have the most impact, such as for certain population groups or in areas with pressing health care needs.
These payments have drawn attention and controversy, particularly regarding their transparency and potential for misuse. According to the Medicaid and CHIP Payment and Access Commission, directed payment use increased from 23 states in 2016 to 37 in 2020 – growing from 65 distinct payment agreements to 230. In 2024, total state spending on directed payments was $110 billion, an amount much greater than on each of the two largest types of FFS supplemental payments – disproportionate share hospital (DSH) and upper payment limit (UPL) payments. The largest beneficiaries of state-directed payments are hospitals, particularly rural and safety-net hospitals.
Critics argue that directed payments can lead to distortions in the allocation of resources, favoring certain providers or services over others, potentially undermining the program’s goals of equity and efficiency.
The Pros of Medicaid Directed Payments
- Increased Flexibility: Directed payments give states more leeway in how they allocate Medicaid funds, enabling them to target specific health care challenges. This can be particularly beneficial in addressing local health disparities or funding innovative models of care delivery.
- Potential for Cost Savings: When states can direct payments toward cost-effective health care solutions, they may see savings. For example, incentivizing preventive care or effective chronic disease management can reduce the need for more expensive emergency care or hospitalizations.
- Focus on Quality of Care: Directed payments can also be tied to quality metrics, encouraging health care providers to focus on improving patient outcomes. This can incentivize better care practices, which may lead to healthier patient populations in the long run.
The Cons of Medicaid Directed Payments
- Potential for Misallocation: Critics argue that Medicaid directed payments can lead to the misallocation of resources. Without proper oversight, funds could be directed toward specific providers or services based on political influence or lobbying efforts rather than public health needs.
- Lack of Transparency: Directed payments can sometimes operate behind closed doors, making it difficult for the public to track how funds are being spent. This lack of transparency raises concerns about accountability and fairness in how Medicaid dollars are distributed.
- Inequity in Access: Directed payments could disproportionately benefit certain providers, particularly those with more political influence or better access to state decision-makers. This could lead to inequities in care access, particularly in underserved or rural areas where providers may have less sway in shaping payment decisions.
Cost Cutting Measures in the New White House and Congress
The House-passed budget places limits on state directed payments (SDPs), with an estimated savings of $25 billion. It would also limit Medicaid provider taxes, lowering the safe harbor from 6% down to 2%, creating savings of $175 billion. Lowering provider taxes also lowers the amounts used for state directed payments, as many states use the provider tax to fund SDPs.
Ultimately, Medicaid directed payments are likely to remain a contentious issue, as the balance between state flexibility and federal oversight remains a key point of contention in U.S. health care policy. The pressure is high to create some type of savings on the federal level, even if the result is to handicap states’ ability to shore up safety-net and rural hospitals.
Yep, we are using the title of the great Charles Dickens’ novel to describe the Senate and House this week. Their visions for a budget are vastly different and they need to come together to make “one big, beautiful bill.” Will they choose “the age of wisdom” or “the age of foolishness?” It’s all in the eyes of the beholder, isn’t it? With that, let’s get into it. Welcome to the Week Ahead!
The Administration
SOTU? Nope…it’s actually called a joint address to Congress. President Trump will address a joint session of Congress on March 4, marking his first major speech since beginning his second term. (While often referred to as a State of the Union (SOTU), a president never delivers an official SOTU address in the first year of a new term.) President Trump is expected to outline his administration’s policy priorities, including recent plans to impose new tariffs on imports from China, Mexico, and Canada, as well as his approach to foreign relations, particularly concerning Ukraine.
We are wondering about what scooby-snacks the President will hand out this year. Recall previous made-for-television addresses where he would announce special awards to gallery attendees….
Democrat response… who’s the party’s next rising star? Senator Elissa Slotkin of Michigan, who previously served in the House and flipped a red district in 2018 before narrowly winning her Senate seat in a state that Trump also carried, will deliver the party’s response. She will highlight alternative policy perspectives with a focus on kitchen-table issues and protecting Medicaid and Medicare. The speech is often a launching pad for a rising star to spotlight party priorities and establish a national presence.
Overturning 50 years of precedent, HHS posted a policy that exempts from public comment matters related to “agency management or to public property, loans, grants, benefits, or contracts,” calling the process inefficient to the operation of the Department. Notice and public comment will continue for all matters required by statute.
Connect the dots with a DOGE executive order for a 30-day sprint to review and reduce Federal contracts, grants, and loans related to immigration, law enforcement, the military, public safety, and the intelligence community.
DOGE is coming for you, HHS. Think CMMI contracts, HRSA grants and loans, NIH.
The Senate
Order up, it’s health care nominations in the Senate. We will hear from Jayanta Bhattacharya, nominee to head the National Institutes of Health on March 5, and Dr. Marty Makary to lead the Food and Drug Administration on March 6.
What should we expect? For NIH, hot topics will include the slashing of indirect costs for researchers, job eliminations in the federal government, and what the research agenda will be for the administration. For FDA, well yes, vaccine safety and efficacy, but don’t forget about the drug and device approval process, supply chain and US manufacturing of drugs, and the controversial lab-developed test rule.
And don’t forget (how could we) that the government funding runs out March 14, and the health care extenders at the end of March. While Republicans and Democrats were working to complete their FY 2025 bills, it’s looking increasingly likely another continuing resolution is in the offing. This time, the extension would run through September 30 with another extension. Riding along would be the health care extenders through September 30 and December 31.
Senate hearings this week
- March 5: Senate HELP confirmation hearing of Jayanta Bhattacharya for NIH
- March 6: Senate HELP confirmation hearing of Jayanta Bhattacharya for NIH
- (and don’t forget March 6-7 is MedPAC)
The House
The hard work of hammering out a budget bill begins. While the Speaker delivered “one big, beautiful bill,” he signaled his support for the Senate Republican leadership’s approach to taxes. Can Speaker Johnson get his fiscal hardliners on board? Senate and House Republican leaders will be meeting this week (and beyond) to determine how best to craft a budget resolution that achieves the President’s domestic agenda AND pass both chambers.
Don’t forget, they must pass the same budget, then the committees have to figure out which policies to fit the budget, then both chambers have to pass that whole budget reconciliation package. The Speaker has stated his goal of delivering a final reconciliation package to the President in May.
One person to keep an eye on is Rep. Elise Stefanik (R-NY) as Senate Republicans have yet to confirm her for the U.S. Ambassador to the United Nations. Her vote has been an important one for Speaker Johnson as Republicans have 2 vacancies in Florida that will not be filled until early April. But with the world scene heating up, how much longer the White House is willing to wait for her nomination is unclear.
In an effort of bipartisanship, the House will take up the Chronic Disease Flexible Coverage Act . Sponsored by Reps. Vern Buchanan (R-FL) and Jimmy Panetta (D-CA), the bill would codify an IRS policy stating that employers who offer high-deductible health plan coverage for their employees the option of including pre-deductible coverage for chronic illnesses.
There You Have It
Did you know that A Tale of Two Cities is considered historical fiction? We in DC feel sometimes we are both working on history and fiction at the same time! What’s your favorite genre? Let us know! Make it a great week!
The Trump administration has put vaccine policy back in the spotlight. With changes in leadership and executive orders multiplying, everyone wants to know – where are we going?
Vaccine Mandates – Where Are We?
Military Vaccine Mandates
President Trump has signed executive orders aimed at reinstating service members who were discharged for refusing COVID-19 vaccinations. The measures include restoring rank and providing back pay. While some argue this move is necessary to rectify unfair dismissals, others like the National Institute of Health (NIH) worry about its implications for military readiness and health protocols.
Educational Institutions
In a recent executive order, President Trump directed the Department of Education to withdraw federal discretionary funding from educational institutions – schools and universities – requiring students to have a COVID-19 vaccine to attend in-person classes. This policy marks a stark departure from previous public health initiatives that aimed at curbing vaccine-preventable diseases in educational settings. Experts warn that such measures could lead to lower vaccination rates among school-aged children, increasing the risk of outbreaks.
Health Care Workers
The Trump administration has not yet issued any executive orders relating to health care workers and their vaccination status. Health care workers are advised to receive several vaccines, including Hepatitis B, flu, COVID-19, varicella, MMR, Tdap/Td, and meningococcal. While some states require health care employers to offer the flu vaccine, it is not mandatory. The Occupational Safety and Health Administration (OSHA) mandates that employers offer the Hepatitis B vaccine to workers with occupational exposure. The Centers for Disease Control and Prevention (CDC) recommends annual flu shots, COVID-19 vaccines, and other immunizations to prevent outbreaks in health care settings.
A New Dose of Debate: Vaccine Policy Issues on the Horizon
Secretary of Health and Human Services Robert F. Kennedy, Jr.
Secretary of Health and Human Services Robert F. Kennedy, Jr. made his case during his confirmation hearings that he is not anti- or pro-vaccine but pro-safety. Although he didn’t win over the vote of Senate Democrats, he did win the crucial vote of Sen. Bill Cassidy (R-LA), a physician by training, and chair of the powerful Senate HELP Committee. Sen. Cassidy remained clear that Sec. Kennedy promised him that he would uphold the public health value of vaccines.
Make America Healthy Again Commission
Speaking of Sec. Kennedy, he will head the newly formed “Make America Healthy Again Commission,” an effort to bring high-level attention to and government collaboration on preventing chronic diseases in children. While the Commission could have addressed vaccine safety and vaccine mandates for children, the executive order establishing the effort does not mention vaccines.
ACIP Panel Is Delayed
The Advisory Committee on Immunization Practices, a group of health experts who develop recommendations on the use of vaccines at the CDC, recently announced a delay in one of their regular meetings. The committee, which meets only three times a year, explained that the delay was due to the need for additional time for public comment. The delay came days after Sec. Kennedy stated he would investigate if childhood vaccine and anti-depressant medications are linked to chronic disease. The committee’s meeting agenda is set to cover numerous vaccines including meningococcal, influenza, and chikungunya.
Who is Calling the Shots?
The nominations of Dr. Dave Weldon as the CDC Director and Dr. Marty Makary as the Federal Drug Administration (FDA) Commissioner have raised concerns among public health experts due to their critical or skeptical views on vaccine mandates.
Weldon, a former congressman and medical doctor, has questioned the safety of vaccines and has been particularly outspoken on the now-debunked view that vaccines can cause autism. Makary, a surgeon and author, opposed vaccine mandates and some other public health measures during the COVID-19 pandemic.
If confirmed, their leadership could signal a shift in public health strategy, potentially moving away from stringent vaccine mandates toward a more flexible and individualized approach. This change may result in revised communication strategies, potentially altering public perception and compliance with vaccine recommendations. These approaches to vaccine communication and policy could dramatically influence compliance rates and overall public health outcomes
Implications for the Public and Health Care Providers
Public Health Outcomes
One of the major concerns about rolling back vaccine mandates is the potential resurgence of vaccine-preventable diseases.
In 2024, Oregon experienced its most significant measles outbreak since the early 1990s, with 31 confirmed cases—the highest in over three decades. All cases occurred among unvaccinated individuals, predominantly children under 18. The Oregon Health Authority noted that the first cases were identified in June, with no new cases reported after August 11, 2024. As children returned to school and the respiratory virus season approached, health officials emphasized the critical importance of vaccination.
Historically, school vaccine mandates played a crucial role in eliminating diseases like measles in the U.S. If vaccination rates decline, outbreaks of diseases once thought to be under control could become a pressing public health crisis.
Health Care Providers
Lower vaccination rates could result in increased health care utilization as preventable diseases reemerge, placing a significant strain on hospitals and providers. A surge in vaccine-preventable illnesses may lead to overcrowded emergency departments, higher hospitalization rates, and increased demand for intensive care services, stretching already limited resources. Additionally, as health systems allocate more time and funding to managing outbreaks, routine and elective care may be disrupted, further compromising patient outcomes.
The Vaccine Gamble Ahead
The election of President Trump and the confirmation of Sec. Kennedy signal a new era for vaccine policy in the US. Further review of vaccine safety and efficacy, as well as a potential reversal of decades of public health initiatives, seems like the future. As the FDA and CDC heads go through the confirmation process and get installed in their agencies, it seems like the future is now.
