The Week Ahead

Washington is looking forward to a three-day weekend, as the nation gears up to celebrate 250 years of independence. However, there’s still a lot going on in the health care space. Medicare payment rules are being reviewed, House conservatives are making a push for health care reform in Reconciliation 3.0, and a 340B reform discussion draft has been published. So, let’s get into it. Welcome to the Week Ahead!

The Administration

Minds may be focused on summer, but it’s also rules season for the Centers for Medicare and Medicaid Services (CMS) as the agency works with the Office of Management and Budget (OMB) to release both proposed and finalized versions of several of the payment rules for calendar (CY) and fiscal year (FY) 2027. The CY27 Physician Fee Schedule proposed rule and CY27 Hospital Outpatient Prospective Payment System (HOPPS) proposed rule are usually released in early to mid-July. We expect the CY27 PFS to acknowledge the statutory end of the 2.5% pay bump that Congress provided for physicians through the 2025 reconciliation bill, which is certain to prompt renewed calls from physician groups for both a short-term fix and longer-term reform of how the PFS rate is calculated. It will also be important to see if CMS responds to concerns about other controversial provisions of the CY26 PFS final rule, such as the -2.5% efficiency adjustment and the reductions to the practice expense portion of the reimbursement calculation for facility-based services. For the CY27 HOPPS proposed rule, we expect CMS to continue its multi-year phase-out of the inpatient-only list and propose a larger 340B conversion factor offset than CY26. CMS may also propose differentiated skin-substitute rates based on Food and Drug Administration (FDA) regulatory categories. These expectations are based on CMS comments included in the CY26 HOPPS final rule fact sheet. CMS and OMB are also still working on releasing the FY27 Hospital Inpatient Prospective Payment System (IPPS) final rule and the FY27 Inpatient Psychiatric Facility (IPF) Prospective Payment System (PPS) final rule, which we expect in late July-early August.

Meanwhile, speculation continues as to who will be President Trump’s next nominee for Food and Drug Administration (FDA) Commissioner. A few names have reportedly emerged as finalists, although the White House has not confirmed this report. Reported finalists include Dr. Heidi Overton, who currently serves as deputy director of the White House Domestic Policy Council, Dr. Jeffery Vacirca, who is the CEO of the board of New York Cancer & Blood Specialists, and Stephen Ferrara, who previously served as Chief Medical Officer for the Navy and the Central Intelligence Agency (CIA). A June 24 report from RBC Capital Markets also listed John Crowley, CEO of the Biotechnology Innovation Organization (BIO), and current acting commissioner Kyle Diamantas as top candidates. Crowley’s appointment would be a big win for pharmaceutical companies and could go a long way in repairing the administration’s relationship with the sector.

In other nomination news, President Trump has announced Chris Klomp will be nominated for Deputy Secretary of Health and Human Services. Klomp has been on the rise after becoming Chief Counselor of HHS in February. This role will require Senate confirmation, but he has already cleared one hurdle: approval from Senate HELP Committee Chair Bill Cassidy (R-LA), who has expressed his support on social media.

The Senate

The Senate has left town until July 13, but right before packing his bags, Senate HELP Committee Chair Cassidy dropped a discussion draft to reform the 340B Drug Pricing Program. The proposed changes aim to prevent duplication of drug discounts, create reporting requirements on how 340B revenue is being used, and impose a sliding fee scale for low-income patients. The discussion draft shows that Chair Cassidy is not taking it easy despite his lame duck status. However, it’s unclear how much progress he can make before his term ends.

The House

Whispers about Reconciliation 3.0 are getting louder again, this time focusing on potential health policy inclusions. House Freedom Caucus members authored a letter to Speaker of the House Mike Johnson (R-LA-4) calling for “health care freedom reforms”, such as expanding access to health savings accounts (HSAs) and strengthening federal price transparency requirements. However, like everything else in the House these days, passage of a third reconciliation bill is complicated by President Trump’s demands to pass his election bill, the SAVE America Act. Speaker Johnson has proposed including a grant program in a third reconciliation package to fund state efforts to implement portions of the SAVE America Act. While this could preemptively meet the Byrd Rule in the Senate, which requires measures passed through reconciliation to have a budgetary impact, it may leave both hardline conservatives (who want full passage of the SAVE America Act) and certain Senate Republicans (who have voiced concerns about the SAVE America Act) unsatisfied.

Additionally, the Ways and Means Committee is looking to take another run at a bill requiring additional transparency from nonprofit hospitals, after it was pulled from a previous Committee markup. The legislation, as previously proposed, would require nonprofit hospitals to meet new transparency requirements when filing their Form 990 with the Internal Revenue Service each year. Our conversations on the Hill indicate that Committee Republicans are still working through the process of incorporating stakeholder feedback and hope to move on it soon.

Also on our radar, the House Majority Leader’s schedule for the week of June 29 incudes H.R. 5347, the Health Care Efficiency Through Flexibility Act. This bill would preserve existing accountable care organization (ACO) quality reporting collection types through performance year (PY) 2029, bar CMS from deeming an ACO’s data “unrepresentative” solely because some participants couldn’t submit via the chosen collection type (subject to certain requirements) and establish an optional digital quality measure pilot (PY 2028–2032) with reporting relief for participants.

Looking ahead: House Democrats are gearing up for future possibilities if they retake the chamber in the midterm elections. Party leadership has established 5 Cost of Living working groups to discuss possible policies to address affordability, which will be the number 1 priority if Democrats win back control of the chamber, according to Minority Leader Hakeem Jeffries (D-NY-8). The Health working group will be headed by Reps. Alexandria Ocasio-Cortez (D-NY-14) and Terri Sewell (D-AL-7) and aims to develop policy recommendations to lower health care costs and expand access. The materials produced by the working group will likely form the backbone of Democratic health policy and signal the changes Democrats will try to enact if they regain control of the House.

House Health Care Hearings This Week

• House Veterans’ Affairs Health Subcommittee legislative hearing on health care legislation
• House Financial Services markup of the Securing Facilities for Mental Health Services Act
• House Education and Workforce HELP Subcommittee hearing on direct contracting

There You Have It

The 4^th of July is almost here, and with it the United States is celebrating the 250^th anniversary. About 45% of Americans were also alive for the 200^th celebrations. If you were there, let us know what you remember about it. Make it a great week!

Congress granted President Trump’s wish, just in time for his 80^th birthday, by sending him the immigration enforcement reconciliation legislation he’s been asking for. Now, President Trump has a new wish, a third reconciliation package to include defense funding and the SAVE America Act. However, Congressional Republicans have differing views on the likelihood of making this wish come true. So, let’s get into it. Welcome to the Week Ahead!

The Administration

The grace period for hospital price transparency is over, according to a notice published on social media by the Department of Health and Human Services (HHS). According to the notice, HHS has sent warning letters  to over 500 hospitals for noncompliance with price transparency requirements since enforcement went into effect on April 1, 2026. The notice and warning letters make it clear that the administration is trying to show that they are making strides in improving health affordability. However, it’s not clear from the notice what additional steps will be taken by the administration to ensure compliance.

On June 8, the District of Massachusetts vacated the Trump administration’s $100,000 fee on new H-1B applications as an unlawful tax. The administration appealed this, and it has been temporarily stayed until a ruling by the U.S. Court of Appeals for the 1^st Circuit. That stay is conditioned on the administration filing a motion to stay no later than June 18, 2026. Whether this fee remains in place has implications for the health care workforce, as many foreign-born physicians, who often fill critical gaps in the health care system, rely on the H-1B visa pathway.

The Senate

Reconciliation 3.0 is off to a rocky start in the Senate as Republican leadership disagrees on whether it is possible at all. Senate Majority Leader John Thune (R-SD) shared that he remains open to the possibility, especially for additional military funding. On the other hand, Senate Appropriations Committee Chair Susan Collins (R-ME) and Senate Appropriations Defense Subcommittee Chair Mitch McConnell (R-KY) are more skeptical about 3.0, cautioning officials not to rely on a 3^rd package to supplement lower funding levels during the normal appropriations process.

In non-reconciliation news, the first stage of the Democratic health care working groups has concluded. The three groups, focused on long-term care, health insurance, and prescription drugs, finished holding their open office hours and will next move to releasing Requests for Information and position papers on their topics according to our conversations on the Hill. These working groups are important to watch for what Democratic leaders may be looking to do if they retake the Senate in November.

Health Care Hearings This Week

The Senate Health, Education, Labor and Pensions (HELP) Committee is scheduled to consider several health care bills on June 17, spanning from organ transplants and drug competition to reauthorizing public health programs, most of which have House companions. Surprisingly absent from the list is S. 4189, the INSULIN Act, which would cap the monthly cost of insulin at $35 for patients with commercial insurance and was reportedly going to be included But don’t count it out yet, bill sponsor Sen. Jeanne Shaheen (D-NH) recently announced that the legislation has reached the 60-vote threshold for passage.

Also on the docket for June 17, the Senate Aging Committee will be holding a hearing on China’s impact on seniors’ health, finances, and security with Commissioners from the U.S.-China Economic and Security Review Commission. The Committee has already held multiple hearings on the security of the pharmaceutical supply chain and the dangers of reliance on foreign countries, including China. Based on this, we expect the topic to come up again at the upcoming hearing.

The House

The House is out until after the Juneteenth holiday, but Republican conversations about Reconciliation 3.0 are still happening. Measures targeting fraud in public health programs are still being viewed as a pay for by some members. However, House Energy and Commerce Health Subcommittee Chair Morgan Griffith (R-VA-9) told reporters that health care systems “need to adjust to the changes we’ve already made.” And then there are concerns from moderates and those in tight races about doing anything that could be seen as limiting access to benefits so close to the November midterms.

There You Have It

It was an exciting weekend for sports fans, as the NBA Finals and the Stanley Cup finals crowned their winners. Here at Chamber Hill Strategies, we have strong opinions about which games we preferred to tune in to. So, have you been watching hockey, basketball, or both? Let us know. Make it a great week!

The summer sprint is on, as lawmakers stream back from the Memorial Day recess. Senate Republican leaders are searching for a way to pass the immigration-enforcement funding reconciliation bill after bolting before recess over concerns about the “anti-weaponization” fund. At the same time, calls for a third reconciliation package to address issues such as affordability and health care show no signs of fading. Meanwhile, the administration is down to the wire on its long-awaited guidance on Medicaid work requirements. So with that, let’s get into it. Welcome to the Week Ahead! 

The Administration 

All eyes are on the Centers for Medicare and Medicaid Services (CMS), which faces a June 1 statutory deadline to issue the interim final rule implementing H.R. 1’s Medicaid community engagement (a.k.a. work) requirements. States and stakeholders are watching closely as the interim final rule has made its way through the Office of Management and Budget (OMB) and is expected to be released imminently. It will fill critical gaps left by December’s preliminary guidance, including how to define and verify the medical frailty exemption. States are also eagerly awaiting this information as they have precious little runway to retool their systems before the January 1, 2027, implementation date. Once the interim rule lands, expect a wave of stakeholder reactions and plenty of midterm-year messaging on both sides. 

Turning now to the Food and Drug Administration (FDA), it’s been nearly a month since Marty Makary resigned under pressure, and Kyle Diamantas stepped in as acting commissioner. The White House has yet to finalize even a formal shortlist of potential permanent replacements. Additionally, the confirmation calendar for health nominees is already crowded, with the Senate still needing to act on President Trump’s nominees for director of the Centers for Disease Control and Prevention and Surgeon General. President Trump is also no stranger to leaving certain agencies with temporary leaders. All of this suggests Diamantas may be in for a longer stint as acting commissioner than initially reported.  

The Senate 

Senate Republican leaders already knew that passing the immigration-enforcement reconciliation package would be tricky. However, the vote math has gotten even trickier after incumbent Sen. John Cornyn (R-TX) was defeated by state Attorney General Ken Paxton in the May 26 GOP primary runoff. Cornyn joins Sen. Bill Cassidy (R-LA), who lost his own primary in May, on a growing roster of departing and lame-duck members with little incentive to fall in line with the President’s agenda, a dynamic that could complicate any party-line whip count. This is especially true since the Republican Conference also includes moderate members such as Sens. Susan Collins (R-ME) and Lisa Murkowski (R-AK), who have been willing to buck Republican leadership and President Trump on items they see as going too far. However, the core of the caucus is likely to gravitate back toward Trump, given the relative political safety proximity to POTUS provides through election cycles. This is one example of the challenges Senate Republican leadership is facing when it comes to moving reconciliation 2.0, let alone 3.0.  

At the Finance Committee, pharmacy benefit manager (PBM) reform may get a second act. February’s funding law already delivered a first tranche, including delinking pharmacy benefit manager pay from drug prices in Medicare Part D and new transparency and rebate pass-through rules for Part D and employer plans. Our conversations on the Hill suggest there may be interest in taking further action on PBM reform. One avenue they could explore is expanding PBM reforms to Medicaid plans. Given the limited time for legislating before the midterms, we would expect any additional PBM reforms to be included in a larger bipartisan legislative package, perhaps at the end of the year. 

Health Care Hearings This Week 

• June 3: Senate HELP Committee hearing on gender transition procedures on minors 
• June 3: Senate Homeland Security Permanent Subcommittee on Investigations hearing on the impacts of the COVID-19 vaccine 
• June 3: Senate Aging Committee hearing on the human cost of foreign drugs 

The House 

Both the Energy & Commerce (E&C) and Ways & Means (W&M) Committees have held a series of hearings on addressing health care affordability, and we’ve been told GOP leaders both want to keep working in this space.    

On the E&C side, we’re hearing of growing interest in addressing price transparency. This could take the form of legislation to strengthen price transparency requirements for insurers and providers, as President Trump called for in his “Great Healthcare Plan.”  

Over at W&M, legislation to increase the amount of information that not-for-profit hospitals have to report on their tax returns appears to still be alive after a discussion draft was released and then pulled from a recent markup of other legislation. The discussion draft would require non-profit hospitals to report on their spending on community benefits, charity care, advertising, quality improvement, non-clinical programming, and more. It’s important to note that any effort to increase the reporting requirements faces fierce resistance from the American Hospital Association, and we’ve been told that committee Democrats are also resisting the bill.  

Health Care Hearings This Week 

• June 2: House Rules Committee meeting of FY 27 FDA appropriations bill  
• June 3: House Oversight Committee hearing on examining HBCS fraud
• June 4: House Judiciary Subcommittee on Courts, Intellectual Property, Artificial Intelligence, and the Internet hearing on medicines and IP 
• June 5: House Appropriations Labor-HHS Subcommittee markup of the FY27 Labor-HHS appropriations bill 

There You Have It 

Summer is (unofficially) here! What summer plans are looking forward to? Let us know. Whatever’s on your agenda, make it a great week!