Weekly Legislative Update March 24-30, 2025

Table of Contents

1. DC and Federal Update
2. No Surprises Act & TinC
3. Cybersecurity, AI, & Tech
4. The States
5. The Industry

Highlights

• CMS nominee Dr. Oz outlines three ways to reform healthcare
• Telehealth survives via last week’s budget bill
• TinC data challenges examined
• Medi-Cal’s budget woes continue
• Minnesota AG settles with Mayo Clinic
• MA supplemental benefits underutilized

DC and Federal Update

Agencies

Dr. Oz, President Trump’s nominee to head up CMS, faced his confirmation hearing last Friday, March 14, with coverage from NYT,? AP and HealthcareDive. Oz suggested three ways to reform the healthcare system:

1. Give patients more information to navigate the system. This is a nod to the president’s recent Executive Order on price transparency and the broader policy of consumer-driven healthcare.
2. AI can be used to ease doctors’ administrative burdens, and
3. Combat waste, fraud and abuse in the system.

Oz also noted in his hearing that he supports Medicaid work requirements. A new report examines the potential effects of Congress enacting work requirements for Medicaid expansion enrollees and found that between 4.6M and 5.2M adults would lose coverage in 2026.

• The enrollment dip would not necessarily because of a lack of eligibility but rather due to bureaucratic barriers such as confusion about requirements, lack of awareness, and reporting difficulties.

Congress

Last week, we reported on the continuing resolution (CR) to fund the gov’t passing in the House. It has since been passed by the Senate as well and was signed into law by Pres. Trump. The funding patch runs through Sept. 30.

• As a reminder, the CR contains several health provisions, including extension of key telehealth waivers, extension of funding for quality measure endorsement, input, and selection, and other measures.
• The CR did not include a fix to the 2.8% cut in Medicare payments to physicians, which took effect in Jan., nor does it include any cuts to the Medicaid program, both of which appear slated for a future spending bill. Additional CR analysis from Politico here.?

No Surprises Act (NSA) & TinC

A new KFF brief examines issues/challenges that users may encounter when using reported price transparency data as required by TinC. Key findings include:

• Unlikely (ghost) rates reported for providers that do not provide the service.
• Challenges identifying rates for hospitals and differing rate structures across payers.
• For more on TinC data challenges and recommendations to "help unlock its full potential,” check out this new Health Affairs article.

Cybersecurity, AI, & Tech

A pilot program at Stanford Health Care and Tampa General Hospital is testing a new smartphone app that records patient encounters, drafts notes, and fills in EHR fields for nurses at the health systems.

Mass General Brigham is partnering with Best Buy to develop a new app to facilitate the health system’s hospital-at-home program.

The States

Medi-Cal's budget woes continue as officials told the California Legislature this week that the state needs another $2.8B to be able to pay providers through the end of the fiscal year.

• Last week, the agency indicated it also needed a $3.4B loan to make critical payments, totaling $6.2B in spending above the projected budget.
• The agency reported that the increase is due to higher-than-expected spending, increased pharmacy costs, and growth in enrollment.

New York’s healthcare community is grappling with a 2024 transparency bill that technically took effect last fall. Described as the first of its kind, the law prohibits requiring patients to sign consent-to-pay forms before they receive medical treatment.

• NY’s health dept ended up delaying implementation of the law indefinitely as physician groups stated it would raise payment issues, logistical problems, and is asking them to provide information they often don’t know. Patient advocates disagree and call the current practice “unfair.”

The Vermont Legislature is considering two bills that increase hospital oversight and limit how much hospitals are authorized to charge for care amidst statewide double digit premium increases, hospital service downgrades, and bankruptcy threats.

• VT has some of the highest average premium prices for individual marketplace plans – more than double the national average.
• VT payers say high hospital and drug costs are to blame, while a recent report found that the state’s hospitals need as much as $3B in subsidies to remain solvent. The state’s top hospital network has cut entire departments at its hospitals.
• VT is considering 2 bills (here and here) that would give Green Mountain Care Board, the state’s health care regulator, the ability to oversee hospital prices, obtain data and make changes to hospital governance.

The Industry

Minnesota’s AG settled with Mayo Clinic this week, finally ending the multiyear dispute over the health system’s debt collection practices. The AG’s office investigated the system over complaints that it was suing patients over unpaid debt that should have qualified for financial assistance and “actively dissuading” patients from seeking help.

• Mayo Clinic stated that it has already made changes to its practices, including spending over $170M in financial assistance last year (double what it spent in years prior).
• Several states, including Washington and Pennsylvania, have proposed bills tackling medical debt in some capacity during the 2025 session.
• The federal Consumer Financial Protection Bureau’s (CFPB’s) finalized rule to remove medical debt from all credit reports is currently frozen under the new administration and facing several lawsuits about its constitutionality.

Optum Rx announced it is eliminating up to 25% of reauthorization requirements for 80 different drugs.

• Removing reauthorizations for these drugs will mean “easier access to medications for consumers, less work for pharmacists and physicians and a simplified system” overall.

?A new JAMA study found that weight loss drugs such as Wegovy and Zepbound are not cost-effective at their current prices.

• According to the study, the average cost per month for Wegovy is around $700 and $520 for Zepbound, but to be considered cost-effective they would need to be cut to $127 per month and $361, respectively.
• This comes amidst reports of skyrocketing employer and govt program costs to cover the high demand for the drug.

This update is solely for informational purposes and should not be relied upon as legal advice.