Friday, June 19, 2026

CMS is recalculating star ratings for Medicare Advantage plans for the 2027 plan year following a court loss to Clover Health. The agency lost a lawsuit arguing its methodology for calculating patient experience and access measures was flawed. This recalculation introduces more volatility into the program; star ratings are directly tied to billions in bonus payments to plans. The changes will not result in a 'freebie' for plans, and final ratings are expected later this summer. For practices, this underscores the ongoing instability in the MA market, which can affect network stability and plan participation decisions for the coming year.

Congress is training fire on the AMA over newly implemented maternity billing CPT codes, citing concerns they may lead to coverage gaps or lower reimbursement. The codes, which went into effect this year, are intended to better capture the complexity of obstetric care but are facing scrutiny from lawmakers who say they were rushed and lack sufficient evidence. The investigation could lead to payer pushback or requests for documentation. OB-GYN practices using the new code set should monitor payer bulletins for any policy shifts and ensure documentation robustly supports the medical necessity and complexity billed under the new framework.

CMS requires applicable clinical laboratories to report private payer rate data for the Clinical Laboratory Fee Schedule by July 31, 2026. This mandatory data collection, required under the Protecting Access to Medicare Act (PAMA), is used to set Medicare payment rates for lab tests for the next three-year cycle. Laboratories that meet the reporting threshold and fail to submit data by the deadline face penalties, including a reduction in future Medicare payments. Labs must verify their reporting obligation and prepare to submit data on test volumes and payment rates from January through June 2026.

The Pharmaceutical Care Management Association (PCMA) has filed a lawsuit seeking to exempt pharmacy benefit managers from Illinois's Prescription Drug Affordability Act. The law establishes a state board with authority to set upper payment limits for certain high-cost drugs. PCMA argues the law is preempted by federal ERISA statute and Medicare Part D. The outcome of this case will influence whether similar state-level drug price control efforts can directly regulate PBM operations and payments. If the law is upheld, it could set a precedent for other states, potentially shifting drug cost and formulary dynamics for commercial plans in those markets. Track the case in the U.S. District Court for the Northern District of Illinois.

A new analysis details the 'AI divide' facing rural hospitals, where limited resources and technical expertise prevent adoption of artificial intelligence tools for revenue cycle, clinical decision support, and operational efficiency. This gap exacerbates the financial and operational pressures that have already placed dozens of rural facilities at immediate risk of closure. The report frames AI adoption as a potential survival tool for rural providers, not just a competitive advantage. For practices in or serving rural areas, this signals a deepening bifurcation in the healthcare landscape: system-affiliated or urban clinics may accelerate ahead with AI-driven denials prevention and coding, while independent rural providers fall further behind on the same tools.