红领巾瓜报

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April 1, 2026

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Federal Policy News

Fueled By Weekly Health Intelligence

President鈥檚 FY 2027 Budget Set to Signal Healthcare Priorities

This week, Congress is awaiting the President鈥檚 budget request for Fiscal Year (FY) 2027, which will听reportedly be听sent to Congress by Friday, April 3. The President鈥檚 budget request includes spending level recommendations for each agency, as well as proposed new policies which Congress may consider, but is not听required听to adopt. The President鈥檚 budget request and subsequent budget justifications from HHS agencies will provide insight into the Administration鈥檚 priorities for healthcare, including policies to reduce waste, fraud, and abuse, and the continued implementation of the听听as well as information regarding how agencies are currently spending their appropriated funds for FY 2026.听

鈥疶he budget will also provide insight into the Administration鈥檚 effort to reorganize HHS, which was first听听in the FY 2026 budget request to Congress, but听听by Congress in FY 2026 appropriations report language. Further, where the President proposed several spending reductions across HHS for FY 2026, including a 40 percent cut to NIH, Congress听generally increased听funding for HHS agencies, or kept funding level with FY 2025.听

鈥�Traditionally, the HHS Secretary and other HHS agency officials testify before the healthcare authorizing and appropriations committee in support of the President鈥檚 budget request.听

HHS and CMS Launch Federal Healthcare Advisory Committee

On March 26, HHS and CMS听听the members of the inaugural federal Healthcare Advisory Committee. The 18-member committee鈥檚 formation was first听听in August, alongside an open call for nominations from individuals and organizations.听It will provide recommendations to HHS Secretary Robert F. Kennedy Jr. and CMS Administrator Dr. Mehmet Oz on opportunities to improve how care is financed and delivered across Medicare, Medicaid, CHIP, and the health insurance marketplace. Specifically, the committee will provide non-binding recommendations focused on:听

  • 鈥淒eveloping actionable policy solutions to prevent and better manage chronic disease;听
  • Advancing accountability for safety and outcomes while reducing unnecessary administrative burden;听
  • Expanding the use of real-time data to support a higher quality of care, speed up claims processing, and improve quality measurement;听
  • Enhancing care for vulnerable populations, including those served by Medicaid; and听
  • Strengthening Medicare Advantage sustainability, including modernizing risk adjustment and quality measurement.鈥�听

The members selected to be a part of the committee include health care executives, state health officials, and health technology innovators. Notably, multiple members have a background in value-based care. Members will serve two-year terms with meetings open to the public. While the first meeting has not yet been scheduled, the committee is expected to听convene听later this year, with meeting notices and public engagement opportunities to be published in the Federal Register and on the CMS website.听

New Executive Order Restricts DEI Activities in Federal Contracting

On March 26, President Trump issued an听听on 鈥淎ddressing DEI Discrimination by Federal Contractors.鈥� The EO seeks to restrict the ability of federal contractors to engage in 鈥渞acially discriminatory DEI activities,鈥� which the EO defines as 鈥渄isparate treatment based on race or ethnicity in the recruitment, employment (e.g., hiring, promotions), contracting (e.g., vendor agreements), program participation, or allocation or deployment of an entity鈥檚 resources.鈥� The EO directs all executive departments and agencies within听30 days听to ensure that all contracts include a clause prohibiting contractors from engaging in 鈥渞acially discriminatory DEI activities,鈥� and allowing the government to cancel the contract听in the event of听noncompliance.听

The EO also directs OMB to issue guidance to agencies related to the EO and to听identify听鈥渆conomic sectors that pose a particular risk of entities engaging in racially discriminatory DEI activities based on current or past conduct鈥� and to issue further guidance detailing 鈥渂est practices鈥� for contracting with entities in these sectors. Finally, the EO directs all agencies to review and report to the Assistant to the President for Domestic Policy听regarding听its compliance with the EO within听120 days听of its issuance.

FDA Approves First Neurologic Treatment for Hunter Syndrome in Nearly 20 Years

On听March 25, FDA听听Denali Therapeutic鈥檚听Avlayah听(tividenofusp听alfa-eknm), the first treatment, in听nearly 20听years, for neurologic manifestations of Hunter syndrome (Mucopolysaccharidosis type II or MPS II).听Hunter syndrome is a rare genetic lysosomal disorder in which sugar molecules accumulate within the lysosomes of cells, resulting in abnormalities in the skeleton, heart, respiratory system, brain, and other organs and affecting physical and mental development.听Avlayah, an IV infusion administered once weekly, is approved for use in presymptomatic or symptomatic pediatric patients who have not yet developed advanced neurologic impairment. The product received multiple designations to incentivize rare disease drug development, including breakthrough, fast track, priority review, and orphan drug designations. The treatment was approved using the accelerated approval pathway based on a surrogate endpoint 鈥� reduction of cerebrospinal fluid heparan sulfate, which was determined to be听reasonably likely听to predict its clinical benefit. Results from a phase 1/2 single-arm trial of 47 pediatric patients were听submitted, in which听Avlayah听demonstrated a 91 percent average reduction in cerebrospinal fluid heparan sulfate at week 24 with 93 percent of patients achieving levels below the upper limit of normal. Under accelerated approval, FDA requires a company to conduct a听post market听study to confirm clinical benefit. The randomized clinical trial to confirm clinical benefit of听Aylayah听is already more than 95 percent enrolled. FDA also granted Denali Therapeutics a Rare Pediatric Disease Priority Review Voucher (PRV). The approval comes as FDA has rejected several rare disease candidates in recent months, resulting in criticism from patient advocates, drug manufacturers, as well as members of Congress, including Senator Ron听Johnsnon听(R-WI), who previously stated that he planned to investigate FDA rejections of certain candidates for the treatment of rare diseases.

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State policy news

State Policy News

Arizona

Arizona Launches RHTP Website; Grant Opportunities to be Posted April 2026. Arizona Governor Katie Hobbs鈥�鈥痮n March 27, 2026,听that听the state has launched the Arizona Rural Health Transformation Program (RHTP) website.听Arizona will post grant funding opportunities in April 2026, with all opportunities posted by May 2026 and awards expected by Summer 2026.听Year 1 funding is targeted to be fully committed by October 30, 2026. The funding will be administered by the Arizona Health Care Cost Containment System (AHCCCS) in partnership with Arizona Department of Health Services (ADHS) and the Arizona Office of Economic Opportunity (OEO), targeting听786,000 individuals听who live in rural communities. Arizona was awarded $167 million by the Centers for Medicare & Medicaid Services for RHTP.听

Colorado

Colorado听Medicaid Director Kim听Bimestefer Resigns. The Colorado Sun鈥�鈥痮n March 30, 2026, that the Colorado Department of Health Care Policy and Financing Executive Director Kim听Bimestefer听resigned as state lawmakers were preparing a vote of no confidence tied to concerns over program spending and management. The resignation follows heightened scrutiny over a听$1.5 billion听budget shortfall, proposed Medicaid cuts, and听identified听misspending, including improper payments for autism services and transportation billing errors.听

Idaho

Idaho Delays Medicaid Managed Care Implementation to 2030. The Idaho Department of Health and Welfare鈥�鈥痶hat it will delay implementation of comprehensive Medicaid managed care to January 1, 2030.听The department will release more information about the Request for Proposals听timeline at a later date.

Nevada

Nevada Submits SPA to Update FQHC, RHC Medicaid Reimbursement Policies. The Nevada Health Authority听听on March 25, 2026, a State Plan Amendment (SPA) to update Medicaid reimbursement policies for Federally Qualified Health Centers (FQHCs) and Rural Health Clinics (RHCs), with a proposed retroactive date of February 22, 2026. The amendment revises prospective payment system (PPS) rate methodologies to reflect statewide managed care requirements, clarifies use of alternative payment methodologies, and听establishes听processes for supplemental payments when managed care organization payments fall below PPS rates. It also adds provisions related to out-of-state FQHC rate setting and strengthens documentation submission timelines tied to rate review enforcement. State officials听indicated the changes are administrative and not expected to have a fiscal impact.

Ohio

Ohio Launches Phase 2 of FIDE-SNP Implementation. The Ohio Department of Medicaid on April 1, 2026, that Ohio has expanded its Next Generation听MyCare听to 10 new counties as part of Phase 2 of the rollout. The program went live January 1, 2026, in the original 29听MyCare听counties, transitioning out of the financial alignment initiative (FAI) demonstration model to a fully integrated dual eligible special needs plan (FIDE-SNP). The remaining counties will become available by August 1. Under Phase 2,听additional听supports听to improve outcomes will also be available, including enhanced behavioral health services, expanded transportation and mobility supports, and strengthened long-term care and community-based living听assistance. Current statewide plans are Elevance/Anthem, CareSource, and Molina; Centene/Buckeye will not be available for new members in 2026.听

Our Insights

Our Insights

Fueled By Experts Across Our 红领巾瓜报 Companies

红领巾瓜报

Identifying Gaps in a Medicare Advantage Plan鈥檚 Quality Strategy for the Part D Benefit

Medicare Advantage (MA) plans are assuming bigger risk in their Part D benefit spending than in previous years due to recent changes in MA rules. Audits of the program, a requirement to听participate听in MA, will mean that there are increased compliance and operational risks in how plans go about serving their members with the Part D benefit. MA plans need to ensure alignment and collaboration across their organizations and with vendors to听optimize听initiatives in quality and Stars. In this case study, 红领巾瓜报 explains how we use our diverse expertise in the Part D program 鈥� including operations, PBM and vendor oversight, health plan leadership, Stars and quality programs, financial and actuarial analysis, and compliance 鈥� to recommended a series of organizational changes and quality improvements to enable the client to optimize their Part D operations.

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2026 Georgia State of Reform Health Policy Conference | April 15, 2026

The inaugural 2026 Georgia State of Reform Health Policy Conference will be taking place in-person on April 15th,听2026听at the Omni Atlanta Hotel at Centennial Park.听

2026 Michigan State of Reform Health Policy Conference | May 5, 2026

The 2026 Michigan State of Reform Health Policy Conference will be taking place in-person on May 5th,听2026听at the Kellogg Hotel and Conference Center!听Managing constant change in healthcare takes more than听just hard听work. It takes a solid understanding of the legislative process and knowledge about听intricacies听of the healthcare system.听罢丑补迟鈥檚听where听State听of Reform comes in.

2026 Maryland State of Reform Health Policy Conference | May 21, 2026

The 2026 Maryland State of Reform Health Policy Conference will be taking place in-person on May 21st, 2026 at the Baltimore Marriott Waterfront! Managing constant change in healthcare takes more than just hard work. It takes a solid understanding of the legislative process and knowledge about intricacies of the healthcare system. 罢丑补迟鈥檚 where State of Reform comes in.

Wakely

Platinum Plans 鈥� Strategic Design Opportunity or Repeat of Past Mistakes?

The 2027 Actuarial Value Calculator creates听a timely听opportunity for health plans to reintroduce Platinum products鈥攏ot as broad offerings, but as targeted, condition-specific strategies that can materially improve margins on high-cost members already in their population. Historically abandoned due to adverse听selection听and inadequate risk adjustment, Platinum plans can now听leverage听higher premiums, stronger risk transfer dynamics, and reinsurance support to deliver better financial outcomes while enhancing member value. However, success is not automatic: plans must carefully design benefits and networks to avoid repeating past mistakes and unintentionally attracting disproportionate external risk.听听

Plans can leverage Wakely鈥檚 unique datasets and strategic听expertise听to understand when this approach works and how to design a winning Platinum strategy.听

Implications of Proposed NBPP on Bronze Plans

The proposed 2027 NBPP introduces a significant shift in ACA marketplace dynamics by allowing听Bronze听plans with higher-than-standard out-of-pocket maximums, enabling ultra-low actuarial value designs and more aggressive pricing strategies. While these plans may improve affordability and attract healthier members, they also introduce meaningful uncertainty鈥攑remium reductions may outpace claims savings, risk adjustment transfers could shift unpredictably, and metal tier migration may disrupt established enrollment patterns. At the same time, regulatory discretion, potential legal challenges, and operational complexities add further risk to implementation.听

Case Study

Advancing Health System Resilience Through Capacity Assessment

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RFP Calendar

RFP Calendar

RFP Calendar

RFP Release
Proposals Due
Awards
Implementation
DateState/ProgramEventBeneficiaries
Date: February 2026 - DELAYEDState/Program: IllinoisEvent: AwardsBeneficiaries: 2,400,000
Date: March 20, 2026State/Program: Hawaii Community Care ServicesEvent: Proposals DueBeneficiaries: 5,500
Date: April 10, 2026State/Program: Hawaii Community Care ServicesEvent: AwardsBeneficiaries: 5,500
Date: May 1, 2026State/Program: Nevada Children's SpecialtyEvent: Proposals DueBeneficiaries: NA
Date: May 12, 2026State/Program: Nevada CO D-SNPEvent: AwardsBeneficiaries: 88,000
Date: June 24, 2026State/Program: Wisconsin LTC GSR 3Event: AwardsBeneficiaries: 56,000 (all GSR)
Date: Summer 2026State/Program: Illinois Foster CareEvent: RFP ReleaseBeneficiaries: 33,000
Date: July 1, 2026State/Program: Hawaii Community Care ServicesEvent: ImplementationBeneficiaries: 5,500
Date: July 28, 2026State/Program: Nevada Children's SpecialtyEvent: AwardsBeneficiaries: NA
Date: August 2026State/Program: IndianaEvent: RFP ReleaseBeneficiaries: 1,400,000
Date: January 1, 2027State/Program: IllinoisEvent: ImplementationBeneficiaries: 2,400,000
Date: January 1, 2027State/Program: Nevada CO D-SNPEvent: ImplementationBeneficiaries: 88,000
Date: January 1, 2027State/Program: Wisconsin LTC GSR 3Event: ImplementationBeneficiaries: 56,000 (all GSR)
Date: January 1, 2027State/Program: Illinois Tailored Care Management ProgramEvent: ImplementationBeneficiaries: 22,400
Date: July 1, 2027State/Program: Nevada Children's SpecialtyEvent: ImplementationBeneficiaries: NA
Date: January 1, 2028State/Program: Wisconsin LTC GSR 4,6Event: ImplementationBeneficiaries: 56,000 (all GSR)
Date: Fall 2027State/Program: OregonEvent: RFP ReleaseBeneficiaries: 1,200,000
Date: 2028State/Program: North CarolinaEvent: RFP ReleaseBeneficiaries: 2,200,000
Date: 2029State/Program: CaliforniaEvent: RFP ReleaseBeneficiaries: NA
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