Thursday, July 23, 2026

CMS released a proposed rule to establish clear limits on state-directed provider taxes and fees that fund Medicaid. The rule aims to codify existing restrictions under the OBBBA law, potentially curbing states' ability to levy certain assessments on healthcare providers. This move signals tighter federal scrutiny of Medicaid financing mechanisms that can affect provider reimbursement rates. The proposed rule opens a 60-day comment period. Billing managers for Medicaid-dependent practices should monitor for state-level reactions, as shifts in these funding streams could indirectly pressure future payment rates.

A major bipartisan bill to reform prior authorization in Medicare Advantage plans passed the House Energy and Commerce Committee unanimously. The legislation, which now moves to the full House floor, mandates faster turnaround times for prior auth decisions and requires insurers to publicly report denial rates. For billing teams, this signals potential relief from administrative delays, but the law is not yet final. Monitor the bill's progress and prepare to adjust workflows if it passes, as it would impose new compliance deadlines on MA payers and could shift appeal timelines for denials.

CMS finalized changes to Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS) supplier enrollment and accreditation requirements effective January 1, 2027. The update modifies the supplier enrollment forms and clarifies accreditation standards for certain product categories. Practices that bill for DMEPOS items, including CPAP machines and diabetic supplies, must verify their enrollment information is current and ensure their accrediting body meets the new standards. Update your supplier files now to avoid claim rejections or payment suspensions when the rule takes effect.

Covered California, the state's ACA marketplace, announced an average rate increase of 9.8% for 2027 plans. This marks the largest single-year hike since 2018 and will affect approximately 1.7 million enrollees. Officials cite rising medical costs, particularly for specialty drugs and hospital services, as the primary driver. The increase comes as federal enhanced subsidies enacted during the pandemic are set to expire, potentially creating a 'double hit' for many consumers. Higher premiums on the individual market often push more patients toward high-deductible plans or cause them to drop coverage altogether, increasing bad debt for providers. Practices in California should prepare for potential shifts in patient insurance mix and higher out-of-pocket cost discussions during the 2027 open enrollment period.