September 5, 2025 • 47 mins
Passed by Congress with razor thin margins, the One Big Beautiful Bill Act (OBBBA) marks the largest Medicaid cut in U.S. history, slashing more than $900 billion over the next ten years, with the CBO estimating more than ten million people losing health insurance by 2034. The implications for providers, legal counsel, and other stakeholders are enormous. Harsh P. Parikh, Partner, Nixon Peabody LLP, Lloyd A. Bookman, Founding Partner, Hooper Lundy & Bookman PC, and Anne Winter, Senior Managing Director, FTI Consulting, discuss the transformative impact that the OBBBA will have on Medicaid. They cover work requirements, beneficiary eligibility and coverage requirements, funding and payment limitations, fraud and abuse provisions, the Rural Health Transformation Program, and what to expect next.
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Episode Transcript
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SPEAKER_00 (00:00):
This episode of AHLA Speaking of Health Law is
brought to you by AHLA membersand donors like you.
For more information, visitAmericanHealthLaw.org.
SPEAKER_03 (00:17):
And hello.
Welcome to the AHLA Speaking ofHealth Law, where today we
unpack the one big beautifulact, a sweeping overhaul
reshaping Medicaid as we knowit.
Passed via budget reconciliationwith razor-thin margins, 51 to
50 in the Senate, 218 to 214 inthe House, this legislation
(00:39):
marks the largest Medicaid cutin U.S.
history, slashing$911 billionover the next 10 years.
CBO estimates that these changeswill result in 10 million people
losing health insurance by 2034.
From new work requirements todramatic funding changes in
rural health innovation, we'llbreak down what matters for
(01:00):
providers, stakeholders, andlegal counsel.
I'm Harsh Parikh, joined by AnneWinter and Lloyd Bookman, and
today, together, we'll guide youthrough what's changing, who's
impacted, and what the futuremay hold for Medicaid.
Quick disclaimer, this podcastis a non-political discussion
(01:21):
recorded on August 27th, 2025.
All views expressed are our ownand do not represent those of
any other organization.
This content is forinformational purposes only and
does not constitute legal adviceor professional advice.
With that, let's get started.
I'm Harsh Parikh, a partner atNixon Peabody.
I work with healthcareproviders, stakeholders, and
(01:43):
managed care organizations tonavigate complex regulatory and
and reinforcement issues,including Medicaid.
Lately, I've been leading NixonPeabody's efforts in helping
clients understand and adapt tothe new law.
Let me pass it over to myco-presenters, Lloyd and Ann.
Lloyd?
SPEAKER_01 (02:00):
Hi, good morning, everybody.
I'm Lloyd Bookman with HooperLundy and Bookman.
I have been a healthcare lawyersince the Carter administration
in 1979, so I've been practicingfor 45 years.
A significant portion of mypractice has involved the
Medicare and Medicaid programswith a heavy emphasis on
Medicaid.
I have advised various statehospital associations concerning
(02:23):
healthcare supplementalpayments, directed payments,
provider fee programs, and havedrafted legislation for a number
of states relating to providerfee programs.
I'm very happy to be here todayand join Ann and Harsh in
presenting this important topic.
Good
SPEAKER_02 (02:39):
morning, everyone.
My name is Anne Winter.
I'm a senior managing directorat FTI Consulting.
I have over 25 years in theMedicaid ecosystem, getting my
start at ACCESS, which is theArizona Medicaid agency where I
led the capitation rate settingand managed care contracting for
much of the program.
And since then, I have been atMedicaid Payers.
(03:02):
I have been head of Medicaidregulatory compliance at CVS
Caremark.
And in the last 10 years I havebeen consulting and I'm really
glad to be here.
SPEAKER_03 (03:14):
Great.
So let's dive in to the firstmain change that the new law
makes, which is a major shiftfor Medicaid expansion adults
ages 19 to 64.
Starting in January 2027, thenew law requires that most of
these adults will need tocomplete and verify at least 80
(03:34):
hours per month of communityengagement.
This includes work, education,volunteering, or a mix to
qualify for coverage andmaintain eligibility.
States must frequently track andconfirm these hours before
enrollment and during regulareligibility checks.
There are some limitedexceptions here for parents with
(03:55):
children under 14, certaindisabled veterans, as well as
certain medically frailindividuals, and states can
grant certain short-termhardship exemptions.
However, failure to comply withthis requirement can lead to
disenrollment, but affectedindividuals have the right to
notice and appeal.
The law sets strict federaloversight, reduced funding for
(04:19):
noncompliance, and expectssignificant operational upgrades
for Medicaid agencies around thecountry to implement these new
so-called work requirements.
To better understand these newrequirements and what they could
mean in practice, and let's lookat how states have used similar
policies before.
What have we learned from thesepolicies, for example, in
(04:41):
Arkansas or Georgia?
SPEAKER_02 (04:44):
Yeah, we have a fairly recent example in
Arkansas, and Georgia actuallyhas an implemented active work
requirement program today.
I think the main lesson learnedin those programs is that, and
to your point that youmentioned, Parsh, is that data
and infrastructure are going tobe key to implementing this
(05:05):
effectively and efficiently.
When Arkansas implemented workrequirements several years ago,
the court shut down the programbecause 18,000 people lost
eligibility within six months.
And a lot of it was due to lackof communication.
The Harvard study on thatprogram mentioned that 70% of
(05:29):
the people that losteligibility, A, didn't think it
applied to them, the workrequirements, or weren't even
aware of it.
In Georgia, they anticipated,they only expanded to 100% of
federal poverty level, but theyanticipated about 240,000 people
would be eligible and sign up.
Only 7,500 actually got throughthe process.
(05:50):
And a lot of it had to do withthe technology and
infrastructure.
So I think, you know, with theserecent lessons, you know, and
the funding that the HHS isgoing to give, I think, you
know, hopefully it will gosmoother.
I want to note there are otherstates that are already in the
process of submitting waivers toCMS to implement work
(06:13):
requirements before JMS.
January 1, 27.
It's like Idaho, Ohio, Arizona,where I live, has a book, a law
in the books that says everyyear they have to submit until
they get approval.
So it'll be interesting to seehow states roll this out early.
And it might be some lessonslearned from some other states.
(06:33):
But I have one question I wantto get your perspectives on is,
as I think about this is thebiggest chunk of that, you know,
911 billion in savings.
is the CBO, interestingly, in2023, did a preliminary scoring
of work requirements forCongress.
And that number was much lower.
(06:55):
It was 109 million.
And they actually, in the letterthey submitted to Congress,
cited the issues with theArkansas program.
So I just wonder, you know, it'sjust interesting to think that
the scoring got higher.
Part of it might be becausethey're including parents of
children over 14.
So anyway, just a Just aquestion I had for you and any
(07:17):
perspective you may have.
SPEAKER_03 (07:19):
Yeah, that's interesting.
And that the numbers aredifferent this time around.
I mean, it could be right thatlayering this requirement on top
of the other pieces of the bill,including the, you know, the
next section we'll get to endwhere sort of there's these new
eligibility determinations,reduced retroactive coverage,
(07:40):
etc.
It's sort of the combination ofthe two that perhaps leads to,
you know, additional savings.
SPEAKER_02 (07:46):
Yeah.
UNKNOWN (07:47):
Yeah.
SPEAKER_03 (07:48):
Lloyd, what's your perspective on this?
I mean, in one way, right, thereis sort of this general feeling
among the legislature that, youknow, folks should be working if
they can.
So why is this a bad thing?
Sounds like, you know, Anne hasprovided some examples of, you
know, experiences in somejurisdictions.
But as a general matter, youknow, what are the implications
(08:09):
of this new requirement?
SPEAKER_01 (08:11):
Well, a couple of things.
One, well, as a practice, CMShas to come up with regular to
implement this requirement byJune 2026.
And the requirement's supposedto be implemented by December
31, 2026 by states with apossibility of a two-year
waiver.
Very concerned that the CMSguidance will be very
(08:34):
restrictive and requiresubstantial documentation that
folks that are Medicaid eligiblejust simply won't be able to
comply with.
And that's a part of whathappened in Arkansas.
So we're very concerned with theloss substantial number of
enrollees, not because eitherthat they're not even engaged in
community activities, but simplybecause they can't get through
(08:55):
the process correctly.
Implications are people who loseMedicaid eligibility still get
sick.
That doesn't mean, losingeligibility doesn't mean you're
not going to need healthcare.
It means you're going to needhealthcare, but if I lose my
Medicaid eligibility, I'm notgoing to go to the best level of
care for what I have.
I'm not going to go to a primarycare doctor.
(09:15):
I'm going to end up in the ER.
And so we're going to see withthis and some of the other
changes.
The fear is that you're going tosee hospitals continuing to
treat more and more uninsuredpatients, losing money, bearing
the cost, states not being ableto come up and support the
hospitals.
And the real fear over the full10-year period that the bill's
(09:37):
in effect been scored for isthat we're going to lose
hospitals, particularly ruralhospitals and emergency
departments.
So that's the big fear.
Last point is I think thisrepresents a whipsawing that we
see every few years.
The Democrats, it seems to me,think healthcare is a right and
(09:57):
they're willing to pay in orderto ensure that there's something
approaching universal coverage.
And that's what we've seen.
Republicans, it seems, thinkhealthcare is a matter of
individual responsibility to alarge extent.
There should be a safety net,but it's up to the individual to
take the steps necessary tocomply with requirements and to
otherwise, if they can possiblyafford it to acquire health
(10:19):
insurance.
So we keep seeing this going,whipsawing back and forth.
And I think it's very concerningfor providers, particularly
providers that treat safety netpatients.
So,
SPEAKER_03 (10:30):
Lloyd, you don't see sort of this leading to more
folks being eligible foremployer-sponsored health care.
It's not sort of taking folksthat are under Medicaid and
shoving them into another, youknow, maybe employer-sponsored
care or some other healthcoverage plan.
It sounds like the real...
expectation here is that folkswill lose coverage.
(10:51):
And as you said, they still havehealthcare needs, just won't
have coverage.
SPEAKER_01 (10:56):
Yeah.
I mean, combining this with theACA retractions to the expansion
programs under, I mean, to theACA, excuse me, to the ACA
exchange programs, you're goingto see folks losing coverage.
I don't think you're going tosee a major shift into
employer-sponsored coverage atall.
SPEAKER_02 (11:16):
And to that point in the Harvard State that on
Arkansas, it showed that, youknow, it did not increase
employer coverage.
You know, people didn't fall offbecause they were going to go
out and get jobs and then get,you know, covered.
That wasn't a result that theysaw.
They were already working.
They just were unable to fillout the application and
(11:37):
paperwork.
SPEAKER_03 (11:39):
Right.
So let's jump into the secondpart of sort of the same issue,
which is the new requirementsimpacting beneficiary
eligibility eligibility andcoverage.
And so, Anne, maybe you can givesome historical perspective on,
you know, what happened toMedicaid eligibility,
enrollment, determinations, etcetera, you know, during COVID,
(12:00):
post-COVID, and that'll sort ofhelp us dive into what the new
law requires.
SPEAKER_02 (12:05):
Yeah, I think we have, you know, a really recent
example of what couldpotentially happen here with the
every six-month redeterminationperiod.
Early 2020, the federalgovernment, you know, announced
a public health emergency.
And as part of that, they gavestates an extra 6.2% in federal
matching dollars, which ispretty significant.
(12:26):
And there were some strings tiedto it.
One of the strings was you couldnot force people to be
redetermined.
And so there was a complete, itwas almost like continuous
eligibility for three years.
And so when the end of the PHEoccurred in March of 2023,
states in April of 23 couldstart doing the redetermination.
(12:47):
And one term of art you hear outthere is it's the unwinding, the
PHE unwinding.
And so states had a certainperiod of time.
They didn't have to do it all atonce.
They could phase it in.
But by the end of the PHE, 94million people were on Medicaid,
and they all had to go throughsome type of process to
determine continuing theireligibility.
(13:11):
And so immediately, 25 millionpeople lost eligibility, and a
lot of them were again, it kindof got back to systems.
Medicaid programs have reallyantiquated systems.
And so, you know, they justbroke down, they froze.
Some states did not use ex partedeterminations where you can go
(13:32):
into the treasury or SNAP tofind, you know, income
eligibility.
So it was really quite adisaster.
But I think, you know, basedupon that, I think states have
that recent experience and Ithink they're going to be able
to hopefully address it betterand more quickly.
I think also, I almost think theOBVBA should be the one big
(13:57):
beautiful technology act becausereally to definitely implement
this technology is going to beso critical and key and even
artificial intelligence andbeing able to process
applications quickly, you know,so you can see the technology
community really kind ofstarting to talk about this and
what, you know, states and plansand providers are going to need
(14:19):
in order to make this asuccessful transition.
Yeah, go ahead.
SPEAKER_03 (14:25):
I'm really glad you brought up the technology piece
because I feel like as we sortof continue this conversation,
that might be something thatisn't really talked about in
terms of ameliorating or perhapsblunting the real impact of some
of these provisions.
If you can get technologicalsolutions to some of these
issues, reducing the paperworkheadaches that led to the issues
(14:49):
in Georgia and Arkansas.
Perhaps, you know, the impact ofthe laws here are not going to
be as concerning as they appear.
SPEAKER_02 (14:58):
Yeah.
SPEAKER_01 (14:58):
I guess one of the questions with respect to
technology solutions is how doyou make those get out to poor
people, Medicaid beneficiaries,enrollees who might not have
high-speed internet, who mightnot be connected, who might not
have...
No broadband in
SPEAKER_02 (15:13):
rural areas,
SPEAKER_01 (15:14):
you know.
Exactly.
SPEAKER_02 (15:15):
Yeah.
SPEAKER_01 (15:16):
So that...
It seems to me that needs to bepart of the solution if we're
going to rely on technologyapplications as a solution to
the problem.
SPEAKER_03 (15:25):
Yeah, no, that makes great sense.
So just jumping into the bill,Ann, as you said, starting in
January 2027, the new lawrequires that instead of once a
year, Medicaid beneficiaries aregoing to be required to confirm
eligibility every six months.
(15:46):
And then the other piece of thelegislation is that retroactive
coverage, so once a beneficiaryis eligible, retroactive
coverage is now limited to onemonth going back rather than
three months.
The last piece here in the lawis its impact on immigrants.
And maybe we'll jump to you,Lloyd, on this.
But big picture, the law limitseligibility for Medicaid to just
(16:09):
U.S.
citizens, certain lawfulpermanent residents, and certain
specific groups.
But it excludes groups likerefugees and humanitarian relief
from eligibility in the Medicaidprogram.
Lloyd, any other thoughts onsort of the implications here of
immigrants?
SPEAKER_01 (16:27):
Yeah, I think you have to look at the retractions
on immigrant eligibility in thebroader context of immigration
enforcement by theadministration and the fear that
folks, particularly undocumentedfolks, have about being at the
being subject to ICE.
(16:49):
And so we're seeing already thatpatients coming into hospitals
who are asked, for example, tofill out information to try to
apply for Medicaid, even today,before all of the heightened
eligibility requirements havekicked in, are reluctant.
Hospitals are getting harder andharder time to enroll folks in
Medicaid programs, includingpeople who are citizens.
(17:09):
They just don't want to giveinformation out.
They're going to get servicesanyway, and they're scared.
So I think we are going to seethat.
And And again, as undocumentedfolks don't get services,
they'll get sicker, be inhospital EDs and lead to that
whole problem.
SPEAKER_03 (17:27):
Yeah, as you said, right?
I mean, it's not that peoplearen't getting sick, they're
just aren't gonna have coverage.
So you're maybe putting them ina position where the condition
gets more and more acute andperhaps we end up spending more
and more healthcare dollars onthat.
Okay, let's jump to sort of thenext big topic.
And Lloyd, I know this has sortof been in your jam for many,
(17:48):
many years and decades, if I maysay so, which is the changes the
law makes to Medicaid fundingand limitations on ways that
Medicaid agencies and states tryto increase the funds that are
available to the state.
SPEAKER_01 (18:04):
Yep.
Thanks, Harsh.
Hospitals and other providerorganizations throughout the
country have been using acombination of provider taxes
and supplemental payments wherethe non-federal share of the
supplemental payments aregenerated by provider taxes for
many years now.
It's become sort of a staple.
(18:25):
It's how state governmentsactually can afford Medicaid.
Right now, 49 states have aprovider tax program.
Whatever you may think of thepolicy merits of a provider tax
program, the fact is that with49 states deeply involved in
provider taxes, it's become anintegral part of how many
(18:47):
Medicaid is funded.
We have it.
And so you can't just throw itout.
The federal government hashated, or CMS, in my opinion,
has not liked provider taxes.
It's been on their hit list fora long time.
How can we reduce it?
But we can't reduce itpolitically because so many
states rely on it, red statesand blue states, states
throughout the country.
(19:07):
So what we see in, and I call itHR1, not the big, beautiful
bill.
What we see in HR1 is an effortto reduce both provider taxes,
not have new provider taxes, andto cut back on state-directed
payments.
The cutbacks to provider taxesare a couple.
(19:29):
One, in order for a provider taxto pass muster under federal
law, it has to be broadly based,it has to be uniform, and it
can't have what's called a holdharmless where the state holds
providers harmless from payingthe tax.
There's a direct hold harmlessand an indirect hold harmless.
There's a safe hold from havinga tax viewed as an indirect hold
(19:50):
harmless where the tax is todate less than 6% of net patient
revenue.
So that's a safe harbor.
A lot of states have been usingthat safe harbor and having
their tax programs go prettyclose to that 6% line.
Well, CMS has done, I mean, theCongress has done a couple of
things.
One, we can't have any newprovider taxes.
(20:10):
So if you don't have a providertax on a particular provider
class or line of services, youcan't put a new one in.
Okay.
Secondly, for expansion statesor existing provider taxes, you
can't have a percentage of netrevenue that is any higher than
the existing percentage.
(20:32):
And secondly, beginning ofOctober 1, let me make sure I
get the date correct here, 2026,the safe harbor percentage goes
down from 6%.
by basically 0.5% a year untilyou get down to 3.5%.
So you're going to have a lot ofstates having their provider tax
(20:56):
availability reduced and capped.
And with fewer provider taxes,either the states are going to
have to kick in more money orwe're going to see reduced
payments to providers.
There's another provision.
That provision is going toaffect many, many states and
many, many provider taxprograms.
There's another provision.
(21:16):
that theoretically is effectiveimmediately.
It was effective on July 5th,which deals with the uniformity
provision.
A lot of states have, not a lotof states, actually seven states
have provider tax programs whereMedicaid utilization is taxed at
a higher rate than otherutilization.
And that helps reduce the numberof providers, frankly, who are
(21:38):
losers under the program.
It's been a staple of theprograms for a number of states
for a number of years.
And it worked because there's astatistical test you can meet
under the federal regulations inorder to have a program be
deemed uniform.
And you can meet the statisticaltest even if you tax Medicaid
utilization more heavily thannon-Medicaid utilization.
(21:59):
CMS hates this.
They've called this a loophole.
They've called it other things.
And the HR1, following on anotice of proposed rulemaking
from CMS that came out in May,HR1 tries to put a stop to this
practice.
and says basically they can'ttax Medicaid utilization at a
(22:21):
higher rate than non-Medicaidutilization.
And the tricky part of that isit's effective July 4th.
It is effective upon theeffective date of HR1.
CMS has the ability to implementa three-year transition period,
up to a three-year transitionperiod, but we haven't seen any
(22:43):
regulations that would, exceptfor the proposed rule that came
out before the bill, So we don'tknow what the transition period
is going to look like.
We don't know if there's goingto be a transition period.
We don't know who it's going toapply to.
And so we have a number ofprovider fee programs that are
in a state of limbo right now,not knowing whether they're
good, bad, indifferent, have tochange.
They'll be given the ability tochange.
(23:04):
It's sort of a scary time forthose programs.
So that's the provider fee side.
Let me move quickly to thestate-directed payment side.
What's a state-directed payment?
State-directed payment is awhere the state directs the
Medicaid managed care plans, theMCOs, what to pay providers.
(23:24):
Often it's, well, you've got topay providers your contracted
rate plus X dollars per day or Ydollars per visit or something
like that.
And most states have directedpayment programs and most of
those programs are financed byprovider taxes.
Well, CMS is restricting orexcuse me, Congress is
(23:48):
restricting through H.R.1, theamounts that can come through
state-directed payments.
So the basic rule, the rule hasbeen that state-directed
payments combined with otherMedicaid payments couldn't
exceed the average commercialrate, which gave folks a lot of
room to go up.
(24:08):
The average commercial rates inmost states are much higher than
total Medicaid payments.
For H.R.1 change, changes theworld there.
Effective immediately, effectiveimmediately, although moved out
to January 1, 2028 for certaingrandfather plans.
(24:31):
And I'll explain what that meansin a minute.
State directed payments can'texceed Medicare rates in an
expansion state, a state that'sexpanded Medicaid under the ACA
and can't, which again, canexceed 110% of Medicare rates in
(24:51):
non-expansion states.
effective October 1, 2028, in agrandfathered, in a state with a
grandfathered plan, thestate-directed payments will
have to be reduced by 10% a yearuntil they get down to Medicare
rates.
(25:13):
In a non-expansion state, it is,again, 10% a year until they get
down to 110% of Medicare rates.
What's a grandfathered plan?
This was a matter of a lot ofdiscussion and back and forth
between the House and theSenate.
But what we ended up with is agrandfather plan is one that has
(25:33):
either been approved before May1, 2025, or a completed
preprint, which is the way astate seeks approval of a
directed payment plan.
A completed preprint seekingapproval was submitted prior to
enactment, prior to July 4,2025.
So if you're grandfathered,You're okay until October 1,
(25:58):
2028.
And after that, you're going tostart seeing your state-directed
payments being reduced by aboutup to 10% a year until you hit
Medicare rates, which is goingto be a large reduction to
state-directed payments in manystates.
And it's going to impactproviders very significantly.
SPEAKER_03 (26:18):
Thank you, Lloyd.
That really complicated piece oflegislation and Medicaid
financing.
I guess, you know, you startedthe conversation discussion
saying, well, put aside themerits of this, the view, I
think, from the feds and a lotof legislatures is these
(26:38):
mechanisms, right, are gamingthe system.
You know, Medicaid is anuncapped benefit.
And this is a way you'recreating distortion among
Medicaid funding principles anddisparities among states.
And so there seems to be, youknow, some concern with these
unique mechanisms and And theysay, once you know one state's
Medicaid program, you know onestate's Medicaid program,
(27:00):
because they're all different,right?
So Anne, maybe you can jump inhere and, you know,
understanding that, you know,there are concerns with these
tools that states have usedhistorically to, you know, get
federal funds for the Medicaidprogram.
But what are other implicationsthat you sort of see as a result
of these financial pressures?
SPEAKER_02 (27:20):
Yeah, I mean, there's so many implications to
this as far as, you know, thewhole safety net system you
know, and potentially guttingit.
And, you know, I, I think all ofus could talk about that, but
I'm going to put my old statehat on.
I did implement a 2% MCO taxhere in Arizona in order to
raise money for providers.
So went through that CMSapproval process back in the
(27:43):
day, but I'm going to, you know,in thinking about having been at
the state and thinking back, youknow, to really 2008, you know,
when we had the economic crash,you know, we're almost in a very
similar position right nowbecause for the first time,
states are starting to feelfiscal pressures on multiple
(28:04):
levels.
They got so much ARPA moneyduring the PHE.
You know, I mean, they werespending money.
They had to spend the money.
Like, it wasn't an option.
And so, you know, there was somuch infrastructure building.
Provider rates were increased inMedicaid.
They had to have home andcommunity-based services
implementation plans to get theextra federal money.
And so, you know, they And nowwith that money is gone, the
(28:29):
ARPA money is gone, you know, sothey have to maintain, you know,
a maintenance of effort of whatthey had built through that, you
know, infrastructure funding.
And now you have the cuts toproviders.
States are going to have to makea really hard decision of, am I
going to backfill that?
And, you know, several statehospital associations funded
Medicaid expansion through theirown provider taxes, you know,
(28:51):
and so there could be a longereven term implication for, you
know, Medicaid expansion, butwe've already seen some states
cut rates across the board.
I mean, Lloyd, you and I weretalking the other day, Idaho 4%,
North Carolina announced a 3%.
And so, you know, is some ofthat cut going to go help fund
(29:14):
the backfill of some of these,you know, taxes?
I don't know.
It's going to be a real jugglinggame.
And again, from sort of aMedicaid regulatory point of
view, is one of the mostimportant and monitored
requirements of managed careorganizations is network
adequacy.
So every state in federal rolehas to establish time and
(29:38):
distance standards for Medicaidpatients based on their
location, where they live, tomake sure they have an adequate
network and access to care.
Well, this is going to probablyhave a big impact on those
network adequacy standards.
And I think all of you haveheard of these ghost networks,
particularly in behavioralhealth where you have a provider
directory on the plan's websiteand you call and they're not in
(30:01):
network.
Well, I don't want to say we'regoing to expand our ghost
networks, but the networkpressures that this is going to
put on is going to be huge forMedicaid beneficiaries just to
get access to care and from aregulatory perspective.
SPEAKER_01 (30:17):
Great points.
To put some dollars on this,just for California, the
California Hospital Associationhas estimated that these cuts to
the direct payments and toprovider taxes combined will be
about a 14% to 30% reduction inpayments to hospitals.
(30:38):
And combined with a potential 4%reduction in Medicare due to
sequestration, the CHA ispredicting a$66 billion to$128
billion reduction in hospitalpayments over the next 10 years.
I don't know how you make thatThat's going to lead to
significant dislocations.
SPEAKER_03 (31:00):
Well, there's one way to make that up, and that's
the Rural Health TransformationProgram.
But before I get to that one, doyou want to touch on the fraud
and abuse provision reallyquickly?
SPEAKER_02 (31:13):
Yeah, just really quickly, there's going to be,
and again, you know, there's atechnology component to this.
There are new provisions toreally make sure that Medicaid
people are alive, you know, areeligible, providers are alive
and properly enrolled inMedicaid programs.
And so there's going to be, Ithink it's 20, 20, 29, when they
(31:35):
implement a new technologysystem, because states right
now, I think I mentionedearlier, these MMS systems are
really old, you know, hard codedand COBOL or something, you
know, a lot of them and statesare trying to modernize, but
they don't necessarily talk toeach other.
So it is true.
People can be enrolled in morethan one Medicaid program.
(31:56):
And so there's going to be newtechnology at the CMS level in
in order to be able, I think, tosee across states to make sure
there isn't duplicateenrollment.
And then the other ones, thefamous death master file and
that DOJ is really excited aboutis states will have to start
(32:18):
checking the death master filequarterly to make sure that all
the Medicaid enrollees arealive.
And also they're gonna startchecking the death master file
as part of the revalidation ofprovider enrollment.
to make sure providers are stillalive.
And so those are some of thesefraud, waste, and abuse
provisions.
SPEAKER_03 (32:40):
Lloyd, do you want to touch on the cost-sharing
piece?
SPEAKER_01 (32:43):
Just really briefly.
Yeah, the HR1 requires states tointroduce cost sharing up to$35.
It's beginning, oh gosh, Iforget the date, beginning
(33:03):
October 1, 2028, again, afterthe election.
But again, up to$35, but there'sno minimum.
It doesn't say how, low the costsharing has to be.
So I'm not quite sure how that'sgoing to be implemented.
If you have a state that's moreliberal, like California or
Massachusetts, can you go awaywith a cost sharing of$1 as
(33:25):
opposed to$35?
There are a variety of servicesthat will be accepted from the
cost sharing, including primarycare services, for example,
which is a good feature.
So I don't know that the cost...
We'll see how the cost sharingprovision is implemented.
Again, since there's no minimum,it's not certain to me exactly
what's going to happen.
SPEAKER_03 (33:45):
Right, and it could be some states implement it, and
the other piece, right, isroutine waivers of cost sharing
is something you don't thinkabout in the Medicaid context,
but it's another issue thatfolks will need to consider.
Okay, let's jump to the RuralHealth Transformation Program,
which does provide somepotential relief in light of
these financial pressures.
(34:06):
The HR1 sets aside$50 billionover five years from 2026 to
2030 to help rural healthcareadapt and innovate.
Each year,$10 billion will bedistributed half equally among
all participating states with anapproved plan and half allocated
based on rural populations andhospital needs.
States are to apply to thisprogram by December 31, 2025
(34:30):
with a detailed plan explaininghow they'll improve rural
access, drive better outcomes,use new technologies, foster
partnerships and stabilize ruralhealth hospital financially.
CMS will review and approveapplications minor progress to
ensure that the funds fulfillthe purpose of the program.
Now, this program is what a lotof legislatures are pointing to
(34:51):
as a way that some of theseimpacts I've been discussing
will be blunted.
So while this program isdesigned to ease the impact of
some of these other Medicaidfunding changes, it's viewed
really as a major new federalinvestment focused on rural
health with the potential tofoster real improvements if used
strategically.
Anne, can you update us on sortof where This program is, as of
(35:14):
today, what are states doing totake advantage of this large
pool of money that's now goingto be available?
SPEAKER_02 (35:22):
Yeah, states are scrambling.
They have to get these plansbuilt and developed, and several
states have requests forinformation, RFIs out there from
all kinds of stakeholders,particularly providers, on how
this should be modeled.
It's not just a replacement ofdish funding or provider taxes,
like you said, Harsh.
(35:43):
It's really transformation, andit has multiple components that
it has to have, includingtechnology.
And so states are really tryingto be thoughtful about it.
Guidance is supposed to come outnext month.
And like you mentioned, theirapplications are due.
I think one of the things is youmentioned there's 50% of the
(36:07):
funding, every state's getequally, but the other 50% is
going to be granted out and notall of it, not every state's
going to be eligible for itpotentially.
And so that's why I think statesare really trying to be
thoughtful about how they dothese applications.
applications because I thinkcorrect me if I'm wrong, it has
(36:30):
to go out to 25% of the states,but not all the states.
And so it's going to be 50% ofthat, 25 billion, it's going to
be very competitive.
So it'll be very, you know,that's why states are really
scrambling to make sure, youknow, they have well thought out
programs.
SPEAKER_01 (36:46):
Hey, Anne, is there, and you're much more up on this
particular provision than I am,are there criterion for CMS to
select states or is there apolitical element?
them into it?
How's that?
I think
SPEAKER_02 (37:00):
that's coming out next month, the guidelines.
Yeah, I think, well, maybe weneed to reconvene next month
after that.
SPEAKER_03 (37:07):
Yeah.
And, you know, the statute hascertain, you know, things that,
you know, that CMS is supposedto focus on as they evaluate
applications.
There are some statutory, butit's pretty loosey-goosey and
they're all oars.
So, you know, depending on howyou craft the application, I
think there's a lot offlexibility and some just
discretion by the agency on whowill meet the criteria.
(37:33):
Lloyd, any other thoughts on theimpact?
I mean, this is 50 billion.
I think we started theconversation with over$900
billion being cut from theprogram.
Do you see this as a way toperhaps blunt some of the
financial stress that are causedby the other provisions that
we've been talking about?
SPEAKER_01 (37:52):
Yeah, although 50 billion sounds like real money,
it does to me.
I think most states, most ruralproviders are looking at it as
the finger in the dike Just notenough.
Too little.
We already have rural hospitalsnationally struggling, most of
whom are in the red.
We've had rural hospitalclosures.
(38:14):
And it's better than not havingthe$50 billion, obviously.
But as Anne explained, it'sgoing to, what, 20% of the
states?
So there'll be winners andlosers and rural hospitals that
don't see the funding.
And it's just not enough.
enough to offset the impact ofHR1.
(38:36):
Yeah.
SPEAKER_03 (38:38):
Okay.
So let's sort of end ourdiscussion with, you know, our
crystal balls and our sort oftakes on what's next.
So maybe, Anne, we'll start withyou.
You know, talk us through, youknow, what you sort of see as
the timeline for implementationand, you know, perhaps one or
two key takeaways for theaudience.
SPEAKER_02 (39:00):
Okay, I got my notes on the timeline because there's
a lot of different components tothat.
So immediate, we've talked aboutsome of the immediate things,
but it's the provider taxfreeze, rural health
applications that we were justtalking about is immediate.
In 2026, immigrationrestrictions, the work
requirement guidance and ruralfunding begins.
(39:21):
2027, a lot happens.
Work requirements begin,six-month redeterminations and
the retroactive coverage limits,28 is the state-directed
payments begin, the reductionsand cost-sharing requirements.
And then as I mentioned in 29,the duplicate enrollment system
should be up and go live.
(39:42):
So here's the thing I would lookto watch for, just having set
capitation rates, having lookedat utilization rates, in working
with Medicaid payers for anumber of years is this bill
really has the potential todestabilize the market.
And as we think about even justwith the PHE unwinding when 25
(40:06):
million people lost coverage,you know, in thinking about the
dual work requirements andsix-month eligibility going
into, you know, people losingeligibility, even temporarily,
that's a lot of that happened inthe unwinding of the PHE.
The capitation rates could Andyou can see this in earnings
reports for all of the bigMedicaid national players.
(40:28):
They're losing money.
Utilization is unpredictable.
State actuaries have a hard timereally predicting the risk going
forward.
And when you take that manypeople, that churn, that
enrollment churn creates thatenvironment.
And then when you also saypeople are going to lose
eligibility because theyshouldn't be eligible, and you
(40:51):
do all this to the safety net,that Lloyd was just talking
about, it's going to be apotential for a lot of
destabilization of healthcaredelivery for a lot of people.
You can already see it in thepremiums for the ACA
marketplace.
Those plans, states are seeing20% premium increases.
(41:11):
And a lot of that's because theythink those advanced premium tax
credits are going to not beextended after January 1.
So they're anticipating they'regoing to lose a lot of
enrollment, probably healthy inAnd so what happens to the
member risk profile?
Probably more expensive.
And so I think we're going tosee a period of rising health
care costs just from increasedrates and reimbursement because
(41:36):
of the risk pool being gutted.
SPEAKER_03 (41:40):
Yeah, really interesting.
Lloyd, thoughts on what's next?
SPEAKER_01 (41:43):
Well, let me take off from what Anne just said,
because I think it's veryinteresting that she's
discussing, well, likely thepremium increases in the
exchange plans and probablylikely premium increases in
commercial plans across theboard to make up for the cost
shift that we'll undoubtedly seeas there's a retrenchment in
Medicaid payments and aretrenchment in enrollment.
(42:04):
But on the flip side, at leastin California, Massachusetts,
and some other states, we haveprograms that are trying to
control costs to consumers ofhealthcare.
California, we have our Officeof Healthcare Affordability that
has adopted cost targets, whichare being implemented to
restrict, for example, how muchhospitals can charge managed
(42:27):
care plans, or at least thegrowth.
And the current target is a 3.5%increase for most hospitals, a
1.8% increase for some others.
And those same targets aresupposed to apply to health
plans and the increase in healthplan premiums.
But as Anne said, we're seeingpremium increase rates at much
(42:47):
higher rates.
So how's that going to work?
If there needs to be a costshift to make up for the lost
revenue that providers are goingto be receiving from Medicaid,
Medicare, but there's no placeto shift.
You can't shift because you'vegot another very
consumer-oriented, not a badidea, notion to try to reduce
(43:08):
costs to consumers.
So I see that as providers andpotentially plants.
And we'll see how that playsout.
I'm also wondering how hospitalsand other provider organizations
are going to, what they're goingto say when they go to the
financing markets.
You know, if you want to float abond issue, what do you put in
your pro forma?
I've had a number of potentialbuyers of hospitals come to me
(43:31):
and say, well, what are we goingto get paid from Medicaid?
I don't know.
And so they have backed out ofof pursuing sales because it's
just so unpredictable.
So I see that as anotherdisruption in the market.
A couple of final words.
I have both a pessimist hat andan optimist hat on.
(43:51):
The pessimist hat is theenrollment is going down.
People aren't going to getcoverage.
Payments are going down.
There's going to be strains inthem.
On the provider community, we'llsee provider closures and all of
that.
And that's a very real, somewhatdark possibility.
Maybe, just maybe, Providerswill be inspired and health
(44:13):
plans and the entire healthcaredelivery system will be inspired
to try to make us moreefficient.
We are the highest cost percapita healthcare system in the
world by far, and we don'tnecessarily get the best
results.
So maybe, just maybe, this willput the squeeze on folks
sufficiently to make us becomemore innovative and develop more
(44:38):
efficient programs with betteroutcomes.
outcomes.
That's, that's my optimist tip.
SPEAKER_02 (44:42):
I was going to ask you, what do you think, do you
think this will help spur morevalue-based care, you know,
value-based payment programs,more systems in that direction
as part of that efficiency?
SPEAKER_01 (44:54):
I think so.
I think it will.
I think payers will be seekingvalue-based solutions to try to,
you know, constrain their,constrain payments and hopefully
improve outcomes.
Yeah.
So, yeah, I think that's right.
SPEAKER_03 (45:13):
I'm glad you entered, Lloyd, on a positive
note, because as Anne sort ofhas been suggesting throughout,
right, there is some promiseahead, right?
AI and smart technology canperhaps streamline operations,
cut costs, and this is the kindof kick that this large program
needs.
Again, trying to be an optimisthere to, you know, improve the
(45:36):
system and have more efficientoutcomes.
A couple of other points on sortof what we might see in the
future.
One, legal challenges, right?
I think there are legalchallenges expected to many of
these provisions, especiallyaround eligibility and the work
requirements.
We talked earlier, you know,we're not sure how, you know,
(45:57):
the merit of those challenges,especially given that this was
congressional action.
Prior challenges were based on,you know, agency action and
perhaps there wasn't enablinglegislation to allow regulators
to do that.
but this is a congressionalaction.
Other things we might see,right, is there's already
discussions about whether theseMedicaid changes can be rolled
(46:20):
back.
Future legislations, I think,Anne, you walked us through the
timeline.
Under the timeline, the hardthings are happening sooner, you
know, but then some of thepotentially politically tough
issues are sort of being, arecoming down the pike.
So there is a chance thatfuture...
legislation or shifts inpolitical leadership, especially
(46:43):
after the upcoming elections,may bring opportunities to
revisit some of these so-calledreforms.
But as you've heard, for now,stakeholders should stay alert
for future guidance, possiblereversals, or adjustments that
could emerge from months ahead.
With that, let's go ahead andend the podcast.
Thank you, everybody, forjoining.
(47:04):
Hope this was a helpful andinformative discussion, and we
look forward to an update in afew months once we see how the
law gets implemented.
Thank you all again.
SPEAKER_00 (47:17):
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AHLA's Speaking of Health Lawwherever you get your podcasts.
For more information about AHLAand the educational resources
available to the health lawcommunity, visit
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And stay updated on breakinghealthcare industry news from
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(47:40):
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UNKNOWN (47:47):
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SPEAKER_03 (00:17):
And hello.
Welcome to the AHLA Speaking ofHealth Law, where today we
unpack the one big beautifulact, a sweeping overhaul
reshaping Medicaid as we knowit.
Passed via budget reconciliationwith razor-thin margins, 51 to
50 in the Senate, 218 to 214 inthe House, this legislation
(00:39):
marks the largest Medicaid cutin U.S.
history, slashing$911 billionover the next 10 years.
CBO estimates that these changeswill result in 10 million people
losing health insurance by 2034.
From new work requirements todramatic funding changes in
rural health innovation, we'llbreak down what matters for
(01:00):
providers, stakeholders, andlegal counsel.
I'm Harsh Parikh, joined by AnneWinter and Lloyd Bookman, and
today, together, we'll guide youthrough what's changing, who's
impacted, and what the futuremay hold for Medicaid.
Quick disclaimer, this podcastis a non-political discussion
(01:21):
recorded on August 27th, 2025.
All views expressed are our ownand do not represent those of
any other organization.
This content is forinformational purposes only and
does not constitute legal adviceor professional advice.
With that, let's get started.
I'm Harsh Parikh, a partner atNixon Peabody.
I work with healthcareproviders, stakeholders, and
(01:43):
managed care organizations tonavigate complex regulatory and
and reinforcement issues,including Medicaid.
Lately, I've been leading NixonPeabody's efforts in helping
clients understand and adapt tothe new law.
Let me pass it over to myco-presenters, Lloyd and Ann.
Lloyd?
SPEAKER_01 (02:00):
Hi, good morning, everybody.
I'm Lloyd Bookman with HooperLundy and Bookman.
I have been a healthcare lawyersince the Carter administration
in 1979, so I've been practicingfor 45 years.
A significant portion of mypractice has involved the
Medicare and Medicaid programswith a heavy emphasis on
Medicaid.
I have advised various statehospital associations concerning
(02:23):
healthcare supplementalpayments, directed payments,
provider fee programs, and havedrafted legislation for a number
of states relating to providerfee programs.
I'm very happy to be here todayand join Ann and Harsh in
presenting this important topic.
Good
SPEAKER_02 (02:39):
morning, everyone.
My name is Anne Winter.
I'm a senior managing directorat FTI Consulting.
I have over 25 years in theMedicaid ecosystem, getting my
start at ACCESS, which is theArizona Medicaid agency where I
led the capitation rate settingand managed care contracting for
much of the program.
And since then, I have been atMedicaid Payers.
(03:02):
I have been head of Medicaidregulatory compliance at CVS
Caremark.
And in the last 10 years I havebeen consulting and I'm really
glad to be here.
SPEAKER_03 (03:14):
Great.
So let's dive in to the firstmain change that the new law
makes, which is a major shiftfor Medicaid expansion adults
ages 19 to 64.
Starting in January 2027, thenew law requires that most of
these adults will need tocomplete and verify at least 80
(03:34):
hours per month of communityengagement.
This includes work, education,volunteering, or a mix to
qualify for coverage andmaintain eligibility.
States must frequently track andconfirm these hours before
enrollment and during regulareligibility checks.
There are some limitedexceptions here for parents with
(03:55):
children under 14, certaindisabled veterans, as well as
certain medically frailindividuals, and states can
grant certain short-termhardship exemptions.
However, failure to comply withthis requirement can lead to
disenrollment, but affectedindividuals have the right to
notice and appeal.
The law sets strict federaloversight, reduced funding for
(04:19):
noncompliance, and expectssignificant operational upgrades
for Medicaid agencies around thecountry to implement these new
so-called work requirements.
To better understand these newrequirements and what they could
mean in practice, and let's lookat how states have used similar
policies before.
What have we learned from thesepolicies, for example, in
(04:41):
Arkansas or Georgia?
SPEAKER_02 (04:44):
Yeah, we have a fairly recent example in
Arkansas, and Georgia actuallyhas an implemented active work
requirement program today.
I think the main lesson learnedin those programs is that, and
to your point that youmentioned, Parsh, is that data
and infrastructure are going tobe key to implementing this
(05:05):
effectively and efficiently.
When Arkansas implemented workrequirements several years ago,
the court shut down the programbecause 18,000 people lost
eligibility within six months.
And a lot of it was due to lackof communication.
The Harvard study on thatprogram mentioned that 70% of
(05:29):
the people that losteligibility, A, didn't think it
applied to them, the workrequirements, or weren't even
aware of it.
In Georgia, they anticipated,they only expanded to 100% of
federal poverty level, but theyanticipated about 240,000 people
would be eligible and sign up.
Only 7,500 actually got throughthe process.
(05:50):
And a lot of it had to do withthe technology and
infrastructure.
So I think, you know, with theserecent lessons, you know, and
the funding that the HHS isgoing to give, I think, you
know, hopefully it will gosmoother.
I want to note there are otherstates that are already in the
process of submitting waivers toCMS to implement work
(06:13):
requirements before JMS.
January 1, 27.
It's like Idaho, Ohio, Arizona,where I live, has a book, a law
in the books that says everyyear they have to submit until
they get approval.
So it'll be interesting to seehow states roll this out early.
And it might be some lessonslearned from some other states.
(06:33):
But I have one question I wantto get your perspectives on is,
as I think about this is thebiggest chunk of that, you know,
911 billion in savings.
is the CBO, interestingly, in2023, did a preliminary scoring
of work requirements forCongress.
And that number was much lower.
(06:55):
It was 109 million.
And they actually, in the letterthey submitted to Congress,
cited the issues with theArkansas program.
So I just wonder, you know, it'sjust interesting to think that
the scoring got higher.
Part of it might be becausethey're including parents of
children over 14.
So anyway, just a Just aquestion I had for you and any
(07:17):
perspective you may have.
SPEAKER_03 (07:19):
Yeah, that's interesting.
And that the numbers aredifferent this time around.
I mean, it could be right thatlayering this requirement on top
of the other pieces of the bill,including the, you know, the
next section we'll get to endwhere sort of there's these new
eligibility determinations,reduced retroactive coverage,
(07:40):
etc.
It's sort of the combination ofthe two that perhaps leads to,
you know, additional savings.
SPEAKER_02 (07:46):
Yeah.
UNKNOWN (07:47):
Yeah.
SPEAKER_03 (07:48):
Lloyd, what's your perspective on this?
I mean, in one way, right, thereis sort of this general feeling
among the legislature that, youknow, folks should be working if
they can.
So why is this a bad thing?
Sounds like, you know, Anne hasprovided some examples of, you
know, experiences in somejurisdictions.
But as a general matter, youknow, what are the implications
(08:09):
of this new requirement?
SPEAKER_01 (08:11):
Well, a couple of things.
One, well, as a practice, CMShas to come up with regular to
implement this requirement byJune 2026.
And the requirement's supposedto be implemented by December
31, 2026 by states with apossibility of a two-year
waiver.
Very concerned that the CMSguidance will be very
(08:34):
restrictive and requiresubstantial documentation that
folks that are Medicaid eligiblejust simply won't be able to
comply with.
And that's a part of whathappened in Arkansas.
So we're very concerned with theloss substantial number of
enrollees, not because eitherthat they're not even engaged in
community activities, but simplybecause they can't get through
(08:55):
the process correctly.
Implications are people who loseMedicaid eligibility still get
sick.
That doesn't mean, losingeligibility doesn't mean you're
not going to need healthcare.
It means you're going to needhealthcare, but if I lose my
Medicaid eligibility, I'm notgoing to go to the best level of
care for what I have.
I'm not going to go to a primarycare doctor.
(09:15):
I'm going to end up in the ER.
And so we're going to see withthis and some of the other
changes.
The fear is that you're going tosee hospitals continuing to
treat more and more uninsuredpatients, losing money, bearing
the cost, states not being ableto come up and support the
hospitals.
And the real fear over the full10-year period that the bill's
(09:37):
in effect been scored for isthat we're going to lose
hospitals, particularly ruralhospitals and emergency
departments.
So that's the big fear.
Last point is I think thisrepresents a whipsawing that we
see every few years.
The Democrats, it seems to me,think healthcare is a right and
(09:57):
they're willing to pay in orderto ensure that there's something
approaching universal coverage.
And that's what we've seen.
Republicans, it seems, thinkhealthcare is a matter of
individual responsibility to alarge extent.
There should be a safety net,but it's up to the individual to
take the steps necessary tocomply with requirements and to
otherwise, if they can possiblyafford it to acquire health
(10:19):
insurance.
So we keep seeing this going,whipsawing back and forth.
And I think it's very concerningfor providers, particularly
providers that treat safety netpatients.
So,
SPEAKER_03 (10:30):
Lloyd, you don't see sort of this leading to more
folks being eligible foremployer-sponsored health care.
It's not sort of taking folksthat are under Medicaid and
shoving them into another, youknow, maybe employer-sponsored
care or some other healthcoverage plan.
It sounds like the real...
expectation here is that folkswill lose coverage.
(10:51):
And as you said, they still havehealthcare needs, just won't
have coverage.
SPEAKER_01 (10:56):
Yeah.
I mean, combining this with theACA retractions to the expansion
programs under, I mean, to theACA, excuse me, to the ACA
exchange programs, you're goingto see folks losing coverage.
I don't think you're going tosee a major shift into
employer-sponsored coverage atall.
SPEAKER_02 (11:16):
And to that point in the Harvard State that on
Arkansas, it showed that, youknow, it did not increase
employer coverage.
You know, people didn't fall offbecause they were going to go
out and get jobs and then get,you know, covered.
That wasn't a result that theysaw.
They were already working.
They just were unable to fillout the application and
(11:37):
paperwork.
SPEAKER_03 (11:39):
Right.
So let's jump into the secondpart of sort of the same issue,
which is the new requirementsimpacting beneficiary
eligibility eligibility andcoverage.
And so, Anne, maybe you can givesome historical perspective on,
you know, what happened toMedicaid eligibility,
enrollment, determinations, etcetera, you know, during COVID,
(12:00):
post-COVID, and that'll sort ofhelp us dive into what the new
law requires.
SPEAKER_02 (12:05):
Yeah, I think we have, you know, a really recent
example of what couldpotentially happen here with the
every six-month redeterminationperiod.
Early 2020, the federalgovernment, you know, announced
a public health emergency.
And as part of that, they gavestates an extra 6.2% in federal
matching dollars, which ispretty significant.
(12:26):
And there were some strings tiedto it.
One of the strings was you couldnot force people to be
redetermined.
And so there was a complete, itwas almost like continuous
eligibility for three years.
And so when the end of the PHEoccurred in March of 2023,
states in April of 23 couldstart doing the redetermination.
(12:47):
And one term of art you hear outthere is it's the unwinding, the
PHE unwinding.
And so states had a certainperiod of time.
They didn't have to do it all atonce.
They could phase it in.
But by the end of the PHE, 94million people were on Medicaid,
and they all had to go throughsome type of process to
determine continuing theireligibility.
(13:11):
And so immediately, 25 millionpeople lost eligibility, and a
lot of them were again, it kindof got back to systems.
Medicaid programs have reallyantiquated systems.
And so, you know, they justbroke down, they froze.
Some states did not use ex partedeterminations where you can go
(13:32):
into the treasury or SNAP tofind, you know, income
eligibility.
So it was really quite adisaster.
But I think, you know, basedupon that, I think states have
that recent experience and Ithink they're going to be able
to hopefully address it betterand more quickly.
I think also, I almost think theOBVBA should be the one big
(13:57):
beautiful technology act becausereally to definitely implement
this technology is going to beso critical and key and even
artificial intelligence andbeing able to process
applications quickly, you know,so you can see the technology
community really kind ofstarting to talk about this and
what, you know, states and plansand providers are going to need
(14:19):
in order to make this asuccessful transition.
Yeah, go ahead.
SPEAKER_03 (14:25):
I'm really glad you brought up the technology piece
because I feel like as we sortof continue this conversation,
that might be something thatisn't really talked about in
terms of ameliorating or perhapsblunting the real impact of some
of these provisions.
If you can get technologicalsolutions to some of these
issues, reducing the paperworkheadaches that led to the issues
(14:49):
in Georgia and Arkansas.
Perhaps, you know, the impact ofthe laws here are not going to
be as concerning as they appear.
SPEAKER_02 (14:58):
Yeah.
SPEAKER_01 (14:58):
I guess one of the questions with respect to
technology solutions is how doyou make those get out to poor
people, Medicaid beneficiaries,enrollees who might not have
high-speed internet, who mightnot be connected, who might not
have...
No broadband in
SPEAKER_02 (15:13):
rural areas,
SPEAKER_01 (15:14):
you know.
Exactly.
SPEAKER_02 (15:15):
Yeah.
SPEAKER_01 (15:16):
So that...
It seems to me that needs to bepart of the solution if we're
going to rely on technologyapplications as a solution to
the problem.
SPEAKER_03 (15:25):
Yeah, no, that makes great sense.
So just jumping into the bill,Ann, as you said, starting in
January 2027, the new lawrequires that instead of once a
year, Medicaid beneficiaries aregoing to be required to confirm
eligibility every six months.
(15:46):
And then the other piece of thelegislation is that retroactive
coverage, so once a beneficiaryis eligible, retroactive
coverage is now limited to onemonth going back rather than
three months.
The last piece here in the lawis its impact on immigrants.
And maybe we'll jump to you,Lloyd, on this.
But big picture, the law limitseligibility for Medicaid to just
(16:09):
U.S.
citizens, certain lawfulpermanent residents, and certain
specific groups.
But it excludes groups likerefugees and humanitarian relief
from eligibility in the Medicaidprogram.
Lloyd, any other thoughts onsort of the implications here of
immigrants?
SPEAKER_01 (16:27):
Yeah, I think you have to look at the retractions
on immigrant eligibility in thebroader context of immigration
enforcement by theadministration and the fear that
folks, particularly undocumentedfolks, have about being at the
being subject to ICE.
(16:49):
And so we're seeing already thatpatients coming into hospitals
who are asked, for example, tofill out information to try to
apply for Medicaid, even today,before all of the heightened
eligibility requirements havekicked in, are reluctant.
Hospitals are getting harder andharder time to enroll folks in
Medicaid programs, includingpeople who are citizens.
(17:09):
They just don't want to giveinformation out.
They're going to get servicesanyway, and they're scared.
So I think we are going to seethat.
And And again, as undocumentedfolks don't get services,
they'll get sicker, be inhospital EDs and lead to that
whole problem.
SPEAKER_03 (17:27):
Yeah, as you said, right?
I mean, it's not that peoplearen't getting sick, they're
just aren't gonna have coverage.
So you're maybe putting them ina position where the condition
gets more and more acute andperhaps we end up spending more
and more healthcare dollars onthat.
Okay, let's jump to sort of thenext big topic.
And Lloyd, I know this has sortof been in your jam for many,
(17:48):
many years and decades, if I maysay so, which is the changes the
law makes to Medicaid fundingand limitations on ways that
Medicaid agencies and states tryto increase the funds that are
available to the state.
SPEAKER_01 (18:04):
Yep.
Thanks, Harsh.
Hospitals and other providerorganizations throughout the
country have been using acombination of provider taxes
and supplemental payments wherethe non-federal share of the
supplemental payments aregenerated by provider taxes for
many years now.
It's become sort of a staple.
(18:25):
It's how state governmentsactually can afford Medicaid.
Right now, 49 states have aprovider tax program.
Whatever you may think of thepolicy merits of a provider tax
program, the fact is that with49 states deeply involved in
provider taxes, it's become anintegral part of how many
(18:47):
Medicaid is funded.
We have it.
And so you can't just throw itout.
The federal government hashated, or CMS, in my opinion,
has not liked provider taxes.
It's been on their hit list fora long time.
How can we reduce it?
But we can't reduce itpolitically because so many
states rely on it, red statesand blue states, states
throughout the country.
(19:07):
So what we see in, and I call itHR1, not the big, beautiful
bill.
What we see in HR1 is an effortto reduce both provider taxes,
not have new provider taxes, andto cut back on state-directed
payments.
The cutbacks to provider taxesare a couple.
(19:29):
One, in order for a provider taxto pass muster under federal
law, it has to be broadly based,it has to be uniform, and it
can't have what's called a holdharmless where the state holds
providers harmless from payingthe tax.
There's a direct hold harmlessand an indirect hold harmless.
There's a safe hold from havinga tax viewed as an indirect hold
(19:50):
harmless where the tax is todate less than 6% of net patient
revenue.
So that's a safe harbor.
A lot of states have been usingthat safe harbor and having
their tax programs go prettyclose to that 6% line.
Well, CMS has done, I mean, theCongress has done a couple of
things.
One, we can't have any newprovider taxes.
(20:10):
So if you don't have a providertax on a particular provider
class or line of services, youcan't put a new one in.
Okay.
Secondly, for expansion statesor existing provider taxes, you
can't have a percentage of netrevenue that is any higher than
the existing percentage.
(20:32):
And secondly, beginning ofOctober 1, let me make sure I
get the date correct here, 2026,the safe harbor percentage goes
down from 6%.
by basically 0.5% a year untilyou get down to 3.5%.
So you're going to have a lot ofstates having their provider tax
(20:56):
availability reduced and capped.
And with fewer provider taxes,either the states are going to
have to kick in more money orwe're going to see reduced
payments to providers.
There's another provision.
That provision is going toaffect many, many states and
many, many provider taxprograms.
There's another provision.
(21:16):
that theoretically is effectiveimmediately.
It was effective on July 5th,which deals with the uniformity
provision.
A lot of states have, not a lotof states, actually seven states
have provider tax programs whereMedicaid utilization is taxed at
a higher rate than otherutilization.
And that helps reduce the numberof providers, frankly, who are
(21:38):
losers under the program.
It's been a staple of theprograms for a number of states
for a number of years.
And it worked because there's astatistical test you can meet
under the federal regulations inorder to have a program be
deemed uniform.
And you can meet the statisticaltest even if you tax Medicaid
utilization more heavily thannon-Medicaid utilization.
(21:59):
CMS hates this.
They've called this a loophole.
They've called it other things.
And the HR1, following on anotice of proposed rulemaking
from CMS that came out in May,HR1 tries to put a stop to this
practice.
and says basically they can'ttax Medicaid utilization at a
(22:21):
higher rate than non-Medicaidutilization.
And the tricky part of that isit's effective July 4th.
It is effective upon theeffective date of HR1.
CMS has the ability to implementa three-year transition period,
up to a three-year transitionperiod, but we haven't seen any
(22:43):
regulations that would, exceptfor the proposed rule that came
out before the bill, So we don'tknow what the transition period
is going to look like.
We don't know if there's goingto be a transition period.
We don't know who it's going toapply to.
And so we have a number ofprovider fee programs that are
in a state of limbo right now,not knowing whether they're
good, bad, indifferent, have tochange.
They'll be given the ability tochange.
(23:04):
It's sort of a scary time forthose programs.
So that's the provider fee side.
Let me move quickly to thestate-directed payment side.
What's a state-directed payment?
State-directed payment is awhere the state directs the
Medicaid managed care plans, theMCOs, what to pay providers.
(23:24):
Often it's, well, you've got topay providers your contracted
rate plus X dollars per day or Ydollars per visit or something
like that.
And most states have directedpayment programs and most of
those programs are financed byprovider taxes.
Well, CMS is restricting orexcuse me, Congress is
(23:48):
restricting through H.R.1, theamounts that can come through
state-directed payments.
So the basic rule, the rule hasbeen that state-directed
payments combined with otherMedicaid payments couldn't
exceed the average commercialrate, which gave folks a lot of
room to go up.
(24:08):
The average commercial rates inmost states are much higher than
total Medicaid payments.
For H.R.1 change, changes theworld there.
Effective immediately, effectiveimmediately, although moved out
to January 1, 2028 for certaingrandfather plans.
(24:31):
And I'll explain what that meansin a minute.
State directed payments can'texceed Medicare rates in an
expansion state, a state that'sexpanded Medicaid under the ACA
and can't, which again, canexceed 110% of Medicare rates in
(24:51):
non-expansion states.
effective October 1, 2028, in agrandfathered, in a state with a
grandfathered plan, thestate-directed payments will
have to be reduced by 10% a yearuntil they get down to Medicare
rates.
(25:13):
In a non-expansion state, it is,again, 10% a year until they get
down to 110% of Medicare rates.
What's a grandfathered plan?
This was a matter of a lot ofdiscussion and back and forth
between the House and theSenate.
But what we ended up with is agrandfather plan is one that has
(25:33):
either been approved before May1, 2025, or a completed
preprint, which is the way astate seeks approval of a
directed payment plan.
A completed preprint seekingapproval was submitted prior to
enactment, prior to July 4,2025.
So if you're grandfathered,You're okay until October 1,
(25:58):
2028.
And after that, you're going tostart seeing your state-directed
payments being reduced by aboutup to 10% a year until you hit
Medicare rates, which is goingto be a large reduction to
state-directed payments in manystates.
And it's going to impactproviders very significantly.
SPEAKER_03 (26:18):
Thank you, Lloyd.
That really complicated piece oflegislation and Medicaid
financing.
I guess, you know, you startedthe conversation discussion
saying, well, put aside themerits of this, the view, I
think, from the feds and a lotof legislatures is these
(26:38):
mechanisms, right, are gamingthe system.
You know, Medicaid is anuncapped benefit.
And this is a way you'recreating distortion among
Medicaid funding principles anddisparities among states.
And so there seems to be, youknow, some concern with these
unique mechanisms and And theysay, once you know one state's
Medicaid program, you know onestate's Medicaid program,
(27:00):
because they're all different,right?
So Anne, maybe you can jump inhere and, you know,
understanding that, you know,there are concerns with these
tools that states have usedhistorically to, you know, get
federal funds for the Medicaidprogram.
But what are other implicationsthat you sort of see as a result
of these financial pressures?
SPEAKER_02 (27:20):
Yeah, I mean, there's so many implications to
this as far as, you know, thewhole safety net system you
know, and potentially guttingit.
And, you know, I, I think all ofus could talk about that, but
I'm going to put my old statehat on.
I did implement a 2% MCO taxhere in Arizona in order to
raise money for providers.
So went through that CMSapproval process back in the
(27:43):
day, but I'm going to, you know,in thinking about having been at
the state and thinking back, youknow, to really 2008, you know,
when we had the economic crash,you know, we're almost in a very
similar position right nowbecause for the first time,
states are starting to feelfiscal pressures on multiple
(28:04):
levels.
They got so much ARPA moneyduring the PHE.
You know, I mean, they werespending money.
They had to spend the money.
Like, it wasn't an option.
And so, you know, there was somuch infrastructure building.
Provider rates were increased inMedicaid.
They had to have home andcommunity-based services
implementation plans to get theextra federal money.
And so, you know, they And nowwith that money is gone, the
(28:29):
ARPA money is gone, you know, sothey have to maintain, you know,
a maintenance of effort of whatthey had built through that, you
know, infrastructure funding.
And now you have the cuts toproviders.
States are going to have to makea really hard decision of, am I
going to backfill that?
And, you know, several statehospital associations funded
Medicaid expansion through theirown provider taxes, you know,
(28:51):
and so there could be a longereven term implication for, you
know, Medicaid expansion, butwe've already seen some states
cut rates across the board.
I mean, Lloyd, you and I weretalking the other day, Idaho 4%,
North Carolina announced a 3%.
And so, you know, is some ofthat cut going to go help fund
(29:14):
the backfill of some of these,you know, taxes?
I don't know.
It's going to be a real jugglinggame.
And again, from sort of aMedicaid regulatory point of
view, is one of the mostimportant and monitored
requirements of managed careorganizations is network
adequacy.
So every state in federal rolehas to establish time and
(29:38):
distance standards for Medicaidpatients based on their
location, where they live, tomake sure they have an adequate
network and access to care.
Well, this is going to probablyhave a big impact on those
network adequacy standards.
And I think all of you haveheard of these ghost networks,
particularly in behavioralhealth where you have a provider
directory on the plan's websiteand you call and they're not in
(30:01):
network.
Well, I don't want to say we'regoing to expand our ghost
networks, but the networkpressures that this is going to
put on is going to be huge forMedicaid beneficiaries just to
get access to care and from aregulatory perspective.
SPEAKER_01 (30:17):
Great points.
To put some dollars on this,just for California, the
California Hospital Associationhas estimated that these cuts to
the direct payments and toprovider taxes combined will be
about a 14% to 30% reduction inpayments to hospitals.
(30:38):
And combined with a potential 4%reduction in Medicare due to
sequestration, the CHA ispredicting a$66 billion to$128
billion reduction in hospitalpayments over the next 10 years.
I don't know how you make thatThat's going to lead to
significant dislocations.
SPEAKER_03 (31:00):
Well, there's one way to make that up, and that's
the Rural Health TransformationProgram.
But before I get to that one, doyou want to touch on the fraud
and abuse provision reallyquickly?
SPEAKER_02 (31:13):
Yeah, just really quickly, there's going to be,
and again, you know, there's atechnology component to this.
There are new provisions toreally make sure that Medicaid
people are alive, you know, areeligible, providers are alive
and properly enrolled inMedicaid programs.
And so there's going to be, Ithink it's 20, 20, 29, when they
(31:35):
implement a new technologysystem, because states right
now, I think I mentionedearlier, these MMS systems are
really old, you know, hard codedand COBOL or something, you
know, a lot of them and statesare trying to modernize, but
they don't necessarily talk toeach other.
So it is true.
People can be enrolled in morethan one Medicaid program.
(31:56):
And so there's going to be newtechnology at the CMS level in
in order to be able, I think, tosee across states to make sure
there isn't duplicateenrollment.
And then the other ones, thefamous death master file and
that DOJ is really excited aboutis states will have to start
(32:18):
checking the death master filequarterly to make sure that all
the Medicaid enrollees arealive.
And also they're gonna startchecking the death master file
as part of the revalidation ofprovider enrollment.
to make sure providers are stillalive.
And so those are some of thesefraud, waste, and abuse
provisions.
SPEAKER_03 (32:40):
Lloyd, do you want to touch on the cost-sharing
piece?
SPEAKER_01 (32:43):
Just really briefly.
Yeah, the HR1 requires states tointroduce cost sharing up to$35.
It's beginning, oh gosh, Iforget the date, beginning
(33:03):
October 1, 2028, again, afterthe election.
But again, up to$35, but there'sno minimum.
It doesn't say how, low the costsharing has to be.
So I'm not quite sure how that'sgoing to be implemented.
If you have a state that's moreliberal, like California or
Massachusetts, can you go awaywith a cost sharing of$1 as
(33:25):
opposed to$35?
There are a variety of servicesthat will be accepted from the
cost sharing, including primarycare services, for example,
which is a good feature.
So I don't know that the cost...
We'll see how the cost sharingprovision is implemented.
Again, since there's no minimum,it's not certain to me exactly
what's going to happen.
SPEAKER_03 (33:45):
Right, and it could be some states implement it, and
the other piece, right, isroutine waivers of cost sharing
is something you don't thinkabout in the Medicaid context,
but it's another issue thatfolks will need to consider.
Okay, let's jump to the RuralHealth Transformation Program,
which does provide somepotential relief in light of
these financial pressures.
(34:06):
The HR1 sets aside$50 billionover five years from 2026 to
2030 to help rural healthcareadapt and innovate.
Each year,$10 billion will bedistributed half equally among
all participating states with anapproved plan and half allocated
based on rural populations andhospital needs.
States are to apply to thisprogram by December 31, 2025
(34:30):
with a detailed plan explaininghow they'll improve rural
access, drive better outcomes,use new technologies, foster
partnerships and stabilize ruralhealth hospital financially.
CMS will review and approveapplications minor progress to
ensure that the funds fulfillthe purpose of the program.
Now, this program is what a lotof legislatures are pointing to
(34:51):
as a way that some of theseimpacts I've been discussing
will be blunted.
So while this program isdesigned to ease the impact of
some of these other Medicaidfunding changes, it's viewed
really as a major new federalinvestment focused on rural
health with the potential tofoster real improvements if used
strategically.
Anne, can you update us on sortof where This program is, as of
(35:14):
today, what are states doing totake advantage of this large
pool of money that's now goingto be available?
SPEAKER_02 (35:22):
Yeah, states are scrambling.
They have to get these plansbuilt and developed, and several
states have requests forinformation, RFIs out there from
all kinds of stakeholders,particularly providers, on how
this should be modeled.
It's not just a replacement ofdish funding or provider taxes,
like you said, Harsh.
(35:43):
It's really transformation, andit has multiple components that
it has to have, includingtechnology.
And so states are really tryingto be thoughtful about it.
Guidance is supposed to come outnext month.
And like you mentioned, theirapplications are due.
I think one of the things is youmentioned there's 50% of the
(36:07):
funding, every state's getequally, but the other 50% is
going to be granted out and notall of it, not every state's
going to be eligible for itpotentially.
And so that's why I think statesare really trying to be
thoughtful about how they dothese applications.
applications because I thinkcorrect me if I'm wrong, it has
(36:30):
to go out to 25% of the states,but not all the states.
And so it's going to be 50% ofthat, 25 billion, it's going to
be very competitive.
So it'll be very, you know,that's why states are really
scrambling to make sure, youknow, they have well thought out
programs.
SPEAKER_01 (36:46):
Hey, Anne, is there, and you're much more up on this
particular provision than I am,are there criterion for CMS to
select states or is there apolitical element?
them into it?
How's that?
I think
SPEAKER_02 (37:00):
that's coming out next month, the guidelines.
Yeah, I think, well, maybe weneed to reconvene next month
after that.
SPEAKER_03 (37:07):
Yeah.
And, you know, the statute hascertain, you know, things that,
you know, that CMS is supposedto focus on as they evaluate
applications.
There are some statutory, butit's pretty loosey-goosey and
they're all oars.
So, you know, depending on howyou craft the application, I
think there's a lot offlexibility and some just
discretion by the agency on whowill meet the criteria.
(37:33):
Lloyd, any other thoughts on theimpact?
I mean, this is 50 billion.
I think we started theconversation with over$900
billion being cut from theprogram.
Do you see this as a way toperhaps blunt some of the
financial stress that are causedby the other provisions that
we've been talking about?
SPEAKER_01 (37:52):
Yeah, although 50 billion sounds like real money,
it does to me.
I think most states, most ruralproviders are looking at it as
the finger in the dike Just notenough.
Too little.
We already have rural hospitalsnationally struggling, most of
whom are in the red.
We've had rural hospitalclosures.
(38:14):
And it's better than not havingthe$50 billion, obviously.
But as Anne explained, it'sgoing to, what, 20% of the
states?
So there'll be winners andlosers and rural hospitals that
don't see the funding.
And it's just not enough.
enough to offset the impact ofHR1.
(38:36):
Yeah.
SPEAKER_03 (38:38):
Okay.
So let's sort of end ourdiscussion with, you know, our
crystal balls and our sort oftakes on what's next.
So maybe, Anne, we'll start withyou.
You know, talk us through, youknow, what you sort of see as
the timeline for implementationand, you know, perhaps one or
two key takeaways for theaudience.
SPEAKER_02 (39:00):
Okay, I got my notes on the timeline because there's
a lot of different components tothat.
So immediate, we've talked aboutsome of the immediate things,
but it's the provider taxfreeze, rural health
applications that we were justtalking about is immediate.
In 2026, immigrationrestrictions, the work
requirement guidance and ruralfunding begins.
(39:21):
2027, a lot happens.
Work requirements begin,six-month redeterminations and
the retroactive coverage limits,28 is the state-directed
payments begin, the reductionsand cost-sharing requirements.
And then as I mentioned in 29,the duplicate enrollment system
should be up and go live.
(39:42):
So here's the thing I would lookto watch for, just having set
capitation rates, having lookedat utilization rates, in working
with Medicaid payers for anumber of years is this bill
really has the potential todestabilize the market.
And as we think about even justwith the PHE unwinding when 25
(40:06):
million people lost coverage,you know, in thinking about the
dual work requirements andsix-month eligibility going
into, you know, people losingeligibility, even temporarily,
that's a lot of that happened inthe unwinding of the PHE.
The capitation rates could Andyou can see this in earnings
reports for all of the bigMedicaid national players.
(40:28):
They're losing money.
Utilization is unpredictable.
State actuaries have a hard timereally predicting the risk going
forward.
And when you take that manypeople, that churn, that
enrollment churn creates thatenvironment.
And then when you also saypeople are going to lose
eligibility because theyshouldn't be eligible, and you
(40:51):
do all this to the safety net,that Lloyd was just talking
about, it's going to be apotential for a lot of
destabilization of healthcaredelivery for a lot of people.
You can already see it in thepremiums for the ACA
marketplace.
Those plans, states are seeing20% premium increases.
(41:11):
And a lot of that's because theythink those advanced premium tax
credits are going to not beextended after January 1.
So they're anticipating they'regoing to lose a lot of
enrollment, probably healthy inAnd so what happens to the
member risk profile?
Probably more expensive.
And so I think we're going tosee a period of rising health
care costs just from increasedrates and reimbursement because
(41:36):
of the risk pool being gutted.
SPEAKER_03 (41:40):
Yeah, really interesting.
Lloyd, thoughts on what's next?
SPEAKER_01 (41:43):
Well, let me take off from what Anne just said,
because I think it's veryinteresting that she's
discussing, well, likely thepremium increases in the
exchange plans and probablylikely premium increases in
commercial plans across theboard to make up for the cost
shift that we'll undoubtedly seeas there's a retrenchment in
Medicaid payments and aretrenchment in enrollment.
(42:04):
But on the flip side, at leastin California, Massachusetts,
and some other states, we haveprograms that are trying to
control costs to consumers ofhealthcare.
California, we have our Officeof Healthcare Affordability that
has adopted cost targets, whichare being implemented to
restrict, for example, how muchhospitals can charge managed
(42:27):
care plans, or at least thegrowth.
And the current target is a 3.5%increase for most hospitals, a
1.8% increase for some others.
And those same targets aresupposed to apply to health
plans and the increase in healthplan premiums.
But as Anne said, we're seeingpremium increase rates at much
(42:47):
higher rates.
So how's that going to work?
If there needs to be a costshift to make up for the lost
revenue that providers are goingto be receiving from Medicaid,
Medicare, but there's no placeto shift.
You can't shift because you'vegot another very
consumer-oriented, not a badidea, notion to try to reduce
(43:08):
costs to consumers.
So I see that as providers andpotentially plants.
And we'll see how that playsout.
I'm also wondering how hospitalsand other provider organizations
are going to, what they're goingto say when they go to the
financing markets.
You know, if you want to float abond issue, what do you put in
your pro forma?
I've had a number of potentialbuyers of hospitals come to me
(43:31):
and say, well, what are we goingto get paid from Medicaid?
I don't know.
And so they have backed out ofof pursuing sales because it's
just so unpredictable.
So I see that as anotherdisruption in the market.
A couple of final words.
I have both a pessimist hat andan optimist hat on.
(43:51):
The pessimist hat is theenrollment is going down.
People aren't going to getcoverage.
Payments are going down.
There's going to be strains inthem.
On the provider community, we'llsee provider closures and all of
that.
And that's a very real, somewhatdark possibility.
Maybe, just maybe, Providerswill be inspired and health
(44:13):
plans and the entire healthcaredelivery system will be inspired
to try to make us moreefficient.
We are the highest cost percapita healthcare system in the
world by far, and we don'tnecessarily get the best
results.
So maybe, just maybe, this willput the squeeze on folks
sufficiently to make us becomemore innovative and develop more
(44:38):
efficient programs with betteroutcomes.
outcomes.
That's, that's my optimist tip.
SPEAKER_02 (44:42):
I was going to ask you, what do you think, do you
think this will help spur morevalue-based care, you know,
value-based payment programs,more systems in that direction
as part of that efficiency?
SPEAKER_01 (44:54):
I think so.
I think it will.
I think payers will be seekingvalue-based solutions to try to,
you know, constrain their,constrain payments and hopefully
improve outcomes.
Yeah.
So, yeah, I think that's right.
SPEAKER_03 (45:13):
I'm glad you entered, Lloyd, on a positive
note, because as Anne sort ofhas been suggesting throughout,
right, there is some promiseahead, right?
AI and smart technology canperhaps streamline operations,
cut costs, and this is the kindof kick that this large program
needs.
Again, trying to be an optimisthere to, you know, improve the
(45:36):
system and have more efficientoutcomes.
A couple of other points on sortof what we might see in the
future.
One, legal challenges, right?
I think there are legalchallenges expected to many of
these provisions, especiallyaround eligibility and the work
requirements.
We talked earlier, you know,we're not sure how, you know,
(45:57):
the merit of those challenges,especially given that this was
congressional action.
Prior challenges were based on,you know, agency action and
perhaps there wasn't enablinglegislation to allow regulators
to do that.
but this is a congressionalaction.
Other things we might see,right, is there's already
discussions about whether theseMedicaid changes can be rolled
(46:20):
back.
Future legislations, I think,Anne, you walked us through the
timeline.
Under the timeline, the hardthings are happening sooner, you
know, but then some of thepotentially politically tough
issues are sort of being, arecoming down the pike.
So there is a chance thatfuture...
legislation or shifts inpolitical leadership, especially
(46:43):
after the upcoming elections,may bring opportunities to
revisit some of these so-calledreforms.
But as you've heard, for now,stakeholders should stay alert
for future guidance, possiblereversals, or adjustments that
could emerge from months ahead.
With that, let's go ahead andend the podcast.
Thank you, everybody, forjoining.
(47:04):
Hope this was a helpful andinformative discussion, and we
look forward to an update in afew months once we see how the
law gets implemented.
Thank you all again.
SPEAKER_00 (47:17):
If you enjoyed this episode, be sure to subscribe to
AHLA's Speaking of Health Lawwherever you get your podcasts.
For more information about AHLAand the educational resources
available to the health lawcommunity, visit
AmericanHealthLaw.org.
And stay updated on breakinghealthcare industry news from
the major media outlets withAHLA's Health Law Daily Podcast,
exclusively for AHLAComprehensive members.
(47:40):
To subscribe and add thisprivate podcast feed to your
podcast app, go toAmericanHealthLaw.org slash
Daily Podcast.
UNKNOWN (47:47):
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