July 30, 2025
This week's roundup:
- In Focus: CMS and Tech Leaders Unite to Build a Patient-Centric Digital Health Ecosystem
- In Focus: Streamlining Healthcare with AI: The Administration鈥檚 Plan and What Comes Next
- In Focus: 60 Years of Medicaid and Medicare Impact: From Milestones to Momentum
- Arkansas Law Banning PBM-Owned Pharmacies Temporarily Blocked by Federal Judge
- Minnesota Suspends Medicaid Funding to Housing Providers Amid Fraud Allegations
- Nevada Names Ann Jensen Medicaid Director
- New Hampshire Enacts 90 Day Notice Law for Medicare Advantage Market Changes, Exits
- South Dakota to Withdraw Section 1115 Medicaid Work Requirements Demonstration Proposal Following New Federal Requirements
- States Sue Trump Administration Over Planned Parenthood Funding Blockade
- Trump Signs Executive Order Calling for Institutionalization of Homeless Individuals With SMI
- Priority Health Expands to Wisconsin with Acquisition of Group Health Cooperative of Eau Claire
In Focus
CMS and Tech Leaders Unite to Build a Patient-Centric Digital Health Ecosystem
The White House and Centers for Medicare & Medicaid Services (CMS), on July 30, 2025, new commitments from leading technology 鈥攊ncluding Amazon, Apple, Google, OpenAI, and Anthropic鈥攖o create a smarter, more secure, and patient-centered digital health ecosystem. At the Make Health Tech Great Again event, CMS unveiled voluntary criteria for trusted data exchange across networks, electronic health records (EHR), and tech platforms, emphasizing interoperability, personalized tools, and reduced provider burden.
This announcement echoes many of the priorities laid out in Leavitt Partners鈥� road map鈥攁 federal policy and industry blueprint for modernizing patient and provider access to health data. The priorities outlined at today鈥檚 White House event and the administration鈥檚 recent regulatory announcements closely reflect the multisector road map鈥檚 recommendations. A recent webinar hosted by Leavitt Partners, an 红领巾瓜报 Company, explored how the recommendations are shaping federal policy and creating strategic opportunities for early adopters.
What鈥檚 Next
红领巾瓜报 (红领巾瓜报) experts, including those with Leavitt Partners, will delve further into the new initiative and considerations for the healthcare industry in an upcoming Weekly Roundup.
Streamlining Healthcare with AI: The Administration鈥檚 Plan and What Comes Next
On July 23, 2025, the Trump Administration , a comprehensive federal strategy designed to position the United States as the global leader in artificial intelligence (AI). The plan, developed in accordance with 14179, outlines over 90 policy initiatives across three strategic pillars: Accelerating Innovation, Building AI Infrastructure, and Leading International AI Diplomacy.
Healthcare and Medicaid Impacts
CMS AI-Enabled Prior Authorization Pilot
The AI Action Plan explains the Centers for Medicare & Medicaid Services (CMS) plan to launch a six-year pilot to improve, streamline, and where possible, automate prior authorizations using AI. Consistent with the AI Action Plan, CMS on June 27, 2025, announced a new Innovation Center model, the Wasteful and Inappropriate Service Reduction (WISeR) Model. WISeR will test ways to improve the prior authorization process relative to Original Medicare鈥檚 existing processes. This initiative is expected to dramatically reduce approval times鈥攆rom days to, potentially, minutes in some cases 鈥� while easing administrative burdens for providers and improving access to timely care for beneficiaries. CMS will evaluate the pilot using metrics such as efficiency gains, cost savings, satisfaction levels, and decision accuracy.
Enhanced Fraud Detection and Program Integrity
CMS will also expand its use of AI to detect and prevent fraud, waste, and abuse (FWA) in Medicaid and Medicare. By leveraging predictive analytics and real-time data, the agency aims to identify anomalies and improper payments before they occur鈥攅nhancing program integrity and public trust.听 CMS is also encouraging state Medicaid agencies to bolster its investments in FWA systems, and enhanced federal funding continues to be available for such investments.
Regulatory Streamlining and Innovation Incentives
The plan calls for removing outdated regulatory barriers to AI adoption in healthcare. Proposed measures include revising compliance requirements and offering financial incentives or preferential funding access to states that foster innovation-friendly environments. While specifics are pending, states are encouraged to modernize regulations to support AI adoption.
Key Differences from Prior Administration鈥檚 AI Policy
The following table outlines key differences between the Biden and Trump administrations’ approaches to AI policy:
Considerations for Healthcare Organizations and Partners
Medicaid agencies, healthcare providers, and industry stakeholders should track the next wave of federal actions to implement the AI Action Plan and the healthcare sector鈥檚 response. Data from pilot initiatives will inform future federal policy decisions on broader AI deployments within Medicaid administration. In addition, healthcare organizations will need to remain nimble as variability may emerge in how states pursue regulatory changes to align with federal incentives under the Action Plan.
Sector specific considerations include:
Health Plans: 听Plans should proactively pursue initiatives such as AI-driven prior authorization, claims adjudication, fraud detection, and member engagement to improve their operations, their position in the markets in which they operate, and ideally, their performance. This effort will require significant investments in information technology, new workflows, and continuous quality improvement initiatives, staff training, enhanced compliance protocols, and a culture that embraces AI. In addition, plans must implement robust AI oversight mechanisms that incorporate the necessary level of transparency, avoid bias, and are appropriate across all functions that use AI, including population health analytics, member engagement, care management, prior authorization management, claims processing, and fraud detection.
State Government: States will face pressure to modernize health and human services regulatory frameworks to align with federal requirements and access federal incentives. Moreover, states should proactively pursue initiatives that improve the operations of health and human services agencies with a particular focus on improving program design, oversight, and evaluation functions. In addition, agencies should assess current rules regarding AI and consider how to support AI adoption while safeguarding desired outcomes and accountability.
Health Systems and Providers: Providers can benefit from reduced administrative overhead, improved care delivery, and the use of AI to augment the ability of providers to diagnose and treat patients. Providers will have to adapt to new workflows that incorporate use of AI, ensure data quality, and monitor data for unintended consequences such as unintended bias. In addition, providers must incorporate AI literacy training to align with federal expectations and remain competitive in a deregulated, innovation-driven landscape. Providers will also have to implement robust compliance protocols.
Looking Ahead
The signals a substantial shift toward streamlined regulatory approaches and expanded AI deployment in Medicaid and broader healthcare administration. Stakeholders should anticipate federal guidance updates, pilot program evaluations, and further clarifications regarding state incentives in the months ahead.
To discuss the implications of the AI Action Plan or for further policy analysis, contact 红领巾瓜报 experts Juan Montanez, Jim McEvoy, or Rula Othman.
60 Years of Medicaid and Medicare Impact: From Milestones to Momentum
This week, the nation celebrates two major milestones: the 60th anniversary of the Medicaid and Medicare programs and 40 years of 红领巾瓜报鈥� (红领巾瓜报鈥檚) commitment to advancing healthcare and improving lives. As we look ahead, 红领巾瓜报 is investing in human-centered strategies, digital tools, and analytics to help our clients and partners build a healthier future鈥攁ll topics that will be discussed at the , October 14鈥�16 in New Orleans, LA.
October 14鈥�16 | New Orleans
The 红领巾瓜报 National Conference is a three-day immersive experience designed to equip healthcare leaders with the insights and tools to adapt and lead in a changing landscape.
As new federal priorities unfold, this year鈥檚 conference, , will feature insights from healthcare leaders on how organizations can respond to change, align with new expectations, and strengthen their impact. With early鈥慴ird registration ending Thursday, July 31, 2025, here鈥檚 our 鈥淲eekly Roundup鈥� of what we鈥檝e shared so far鈥攁nd why you won鈥檛 want to miss the 红领巾瓜报 National Conference in New鈥疧rleans.
红领巾瓜报鈥檚 National Conference offers an immersive, three鈥慸ay experience that combines strategic insight, peer collaboration, and interactive learning.
Networking & Community
- Welcome Reception at a landmark New Orleans venue
- Facilitated breakfast discussions, coffee conversations, and evening receptions
- Networking lunch and dedicated breaks to keep ideas flowing
Big Picture Plenary Sessions
- Opening keynote Asa Hutchinson, Arkansas鈥� 46th Governor, on policy, politics, and a vision for healthier communities
- Expert panels unpacking transformative shifts in Medicaid and Medicare, value鈥慴ased care, behavioral health innovation, and cross鈥憇ector population health strategies
- A closing conversation on government鈥檚 evolving role in healthcare innovation with nationally recognized leaders , Executive Vice President and Chief Community Health Officer, Kaiser Permanente, and , Secretary, Louisiana Department of Health
Workshops
- Policy & Trends: Medicare Advantage reforms, Medicaid work requirements, digital health guardrails, and 988 crisis care expansion
- Use Cases & Responses: Operational strategies for payment reform, community resilience investments, digital health success stories, and coordinated care solutions for complex behavioral health needs
红领巾瓜报 Roundup
Arkansas
Arkansas Law Banning PBM-Owned Pharmacies Temporarily Blocked by Federal Judge. The Associated Press听听on July 28, 2025, that a federal judge has temporarily blocked Arkansas from enforcing a new law that would ban pharmacy benefit managers (PBMs) from owning pharmacies, the first such law in the country. The law, signed by Governor Sarah Huckabee Sanders and originally set to take effect August 5, was challenged by CVS and Express Scripts, who argued it unfairly targeted out-of-state companies. The judge agreed, citing discrimination concerns, and issued a preliminary injunction. Arkansas Attorney General Tim Griffin plans to appeal the ruling.
Minnesota
Minnesota Suspends Medicaid Funding to Housing Providers Amid Fraud Allegations. KARE 11听听July 28, 2025, that Minnesota Governor Tim Walz has suspended Medicaid payments to 50 of the largest providers in the state鈥檚 Housing Stabilization Services (HSS) program following evidence of fraud. The state Department of Human Services flagged these providers after identifying billing anomalies through data analysis and investigations. State officials now designate HSS providers as 鈥渉igh risk,鈥� triggering stricter enrollment, oversight, and surety bond requirements to enroll or revalidate. The program, initially projected at $2.6 million annually, has grown to over $100 million.
Nevada
Nevada Names Ann Jensen Medicaid Director. Health Payer Specialist听听on July 29, 2025, that Nevada has selected Ann Jensen to be the state Medicaid director. Jensen previously served as innovation officer for Medicaid. The former Medicaid director Stacie Weeks is now director of the new Nevada Health Authority.
New Hampshire
New Hampshire Enacts 90 Day Notice Law for Medicare Advantage Market Changes, Exits. Health Payer Specialist听听on July 25, 2025, that New Hampshire has enacted a law requiring health insurers, including Medicare Advantage plans, to provide a 90 day notice to the state insurance department before exiting the market, altering CMS contracts, withdrawing from a county, or making major benefit changes. The legislation addresses concerns over abrupt Medicare Advantage exits that left seniors unprepared and aims to improve transparency and consumer support.
South Dakota
South Dakota to Withdraw Section 1115 Medicaid Work Requirements Demonstration Proposal Following New Federal Requirements. South Dakota Searchlight听听on July 23, 2025, that the state Department of Social Services will be withdrawing its Section 1115 demonstration proposal to implement Medicaid work requirements now that federal work requirements became law with the passage of H.R. 1. The federal Medicaid work requirements bar any state waivers if they are more lenient than the federal law, which requires able-bodied adults on Medicaid to work or volunteer at least 80 hours per week and requires more frequent eligibility checks. South Dakota鈥檚 proposal did not specify a number of hours that enrollees would have to work, and it only would have checked eligibility on an annual basis. All states must implement Medicaid work requirements by the end of 2026.
National
States Sue Trump Administration Over Planned Parenthood Funding Blockade. The Hill听听on July 29, 2025, that 22 states and the District of Columbia have filed a lawsuit against the U.S. Department of Health and Human Services (HHS) over a provision in H.R. 1 that bars Medicaid funding from going to clinics that offer abortion services. The lawsuit argues that not funding these clinics, namely Planned Parenthood, will deny low-income Americans necessary services like cancer screenings and treatment for sexually transmitted infections, cause problems among the healthcare infrastructure with closing clinics, and increase healthcare costs. The coalition behind the lawsuit is seeking a court order declaring the cuts unconstitutional. Planned Parenthood has also filed a lawsuit over the provision, and a federal judge听granted听a temporary injunction in July 2025 to block the Trump administration from enforcing the cuts, which HHS has appealed.
Trump Signs Executive Order Calling for Institutionalization of Homeless Individuals With SMI. NPR听听on July 24, 2025, that President Trump has signed an executive order aimed at managing homelessness. The order calls for policy changes to make it easier to remove homeless encampments, enforce encampment bans, and get homeless individuals into behavioral health treatment, including involuntary commitments of individuals that are deemed a risk to themselves or others to long-term institutional settings. It also aims to shift federal funding away from housing first policies to prioritize treatment in facilities that require sobriety, and calls on the departments of Health and Human Services (HHS) and Housing and Urban Development to prioritize areas that are actively policing drug use and encampments to the fullest extent of the law when assessing federal grant programs. The Substance Abuse and Mental Health Services Administration (SAMHSA) would need to ensure that grants issued for harm reduction do not 鈥渇acilitate illegal drug use.鈥�
Industry News
Priority Health Expands to Wisconsin with Acquisition of Group Health Cooperative of Eau Claire. Michigan-based Priority Health听听on July 24, 2025, an agreement to become the governing member of Group Health Cooperative of Eau Claire, which serves over 61,000 members across Medicaid, Medicare, commercial, and state employee plans in Wisconsin. The deal, expected to close by year-end 2025, follows Priority Health鈥檚 2024 acquisition of Physicians Health Plan of Northern Indiana, bringing its total footprint to four states: Michigan, Indiana, Ohio, and Wisconsin.
RFP Calendar
Actuaries Corner
.听The final tally from the nonpartisan budget scorekeeper estimates the law will decrease federal healthcare spending by $1.1 trillion over the next decade.听Editor’s Note:听Of the $1.1 trillion in projected healthcare spending cuts, $326 billion comes from implementing work requirements, $149 billion from limiting state-directed payments, and $191 billion from freezing provider taxes. These changes along with the large increase in the uninsured population are expected to significantly impact rural hospitals and providers that depend heavily on Medicaid reimbursement.
Discover other developments in the Wakely Wire .
红领巾瓜报 News & Events
Wakely Free Guide
Wakely, an 红领巾瓜报 Company, offers supports for providers, from fully outsourcing a data, actuarial, or financial function to very specialized expertise for a niche problem. We’ve developed a new RADV Strategy Guide that explores RADV Audit Impacts to Provider Risk Agreements.
In May, CMS announced that ALL Medicare Advantage (MA) plans will face mandatory RADV audits starting with the 2019 plan year鈥攁nd the financial impact on risk-bearing providers could be substantial.
NEW THIS WEEK ON 红领巾瓜报 INFORMATION SERVICES
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红领巾瓜报IS Medicaid Market Overviews, Reports, and Data
- Updated Section 1115 Medicaid Demonstration Inventory
- Updated 红领巾瓜报 Federal Health Policy Snapshot
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- Updated Tennessee Overview
A subscription to 红领巾瓜报 Information Services puts a world of Medicaid information at your fingertips, dramatically simplifying market research for strategic planning in healthcare services.
If you鈥檙e interested in becoming an 红领巾瓜报IS subscriber, contact Andrea Maresca at听[email protected].