On May 11, the House Energy and Commerce Committee released a detailed legislative text and a section-by-section summary of a broad health package affecting Medicaid, the Children’s Health Insurance Program (CHIP), ACA marketplace plans, and Medicare pharmacy benefit manager (PBM) oversight.
While high-profile elements related to Medicaid — such as proposed changes to provider taxes, noncitizen coverage, and Medicaid expansion populations — are drawing significant media attention, the legislation also contains several under-the-radar but consequential policies.
Program Integrity:
The legislation includes multiple provisions aimed at improving data accuracy and curbing waste, fraud, and abuse in Medicaid. These measures target administrative loopholes that have led to inefficiencies and duplicate spending. While these baseline oversight functions existed in different formats, they will now be uniform and codified:
- Dual Enrollment Prevention: Requires a system that prevent individuals from being enrolled in more than one state’s Medicaid program at the same time.
- Quarterly Death File Checks for Providers and Enrollees: States must conduct quarterly checks of both beneficiary and provider records against the Social Security Administration’s Death Master File. While many states already run monthly enrollee checks — particularly in managed care programs — this provision adds providers to the review process, helping further prevent erroneous payments.
- Monthly Termination Checks: States must perform monthly cross-checks to identify providers who have been terminated by HHS or other states. Those flagged will be automatically disenrolled from Medicaid. Although the ACA required disenrollment of terminated providers, this new monthly verification requirement strengthens enforcement.
Regulatory Delays:
The legislative package includes targeted rollbacks or delays of rules introduced under the Biden administration:
- Staffing Standards Moratorium for LTC Facilities: Implementation of federal staffing mandates for long-term care facilities will be delayed until January 1, 2035.
- Delay in Streamlining Medicaid & MSP Eligibility: Proposed changes to streamline eligibility determinations for Medicaid and the Medicare Savings Program (MSP) will be delayed until January 1, 2035.
- Medicaid Enrollment Rule Delay: Delays implementation of the federal rule aimed at streamlining eligibility and enrollment processes for Medicaid, CHIP, and the Basic Health Program until January 1, 2035.
Importantly, despite these delays, the Medicaid access-to-care rules remain intact, signaling continued federal emphasis on strengthening access and equity in care delivery.
Out-of-State Provider Enrollment
A standout provision for providers is the requirement that states create a streamlined enrollment process for out-of-state pediatric providers in Medicaid and CHIP. This change eliminates duplicative screening processes and lowers administrative barriers, making it easier for qualified providers to serve children across state lines.
This is a notable win for pediatric specialists and facilities that frequently treat children referred from other states, especially those with rare or complex conditions, and a step forward in improving continuity of care for medically vulnerable children.
Medicaid DSH Cuts Postponed
The bill postpones the scheduled $8 billion in annual Medicaid Disproportionate Share Hospital (DSH) cuts, originally set to begin in FY 2026, to FY 2029. This extension offers critical financial relief for safety-net hospitals and allows states more time to prepare budget adjustments.
Additionally, Tennessee’s DSH funding — previously set to expire at the end of FY 2025 — is extended through FY 2028, ensuring continued support for the state’s uncompensated care system.
As the legislative process moves forward, stakeholders should monitor implementation timelines, particularly around the program integrity provisions, and begin preparing systems and staff for compliance with new federal mandates.