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!