Thursday, September 3, 2026

An HHS Office of Inspector General audit found Medicare paid at least $408 million for over-the-counter drugs and other ineligible items from January 2023 through June 2025. The audit examined Medicare Advantage and Part D plan payments. The OIG recommended CMS instruct insurers to strengthen payment controls and recover improper payments. While the audit focuses on plan oversight, it signals broader scrutiny of drug category payments. Billing teams for practices that dispense or prescribe high-volume drug categories should monitor payer bulletins for any new coverage or documentation requirements stemming from this finding.

Healthy Blue, a Louisiana Medicaid managed care plan, will terminate its contract with the state effective December 31, 2026. The exit will force an estimated 400,000 Medicaid recipients to select a new plan during the upcoming open enrollment period. Practices with a significant Healthy Blue patient panel must prepare for coverage transitions and potential disruptions in authorizations or claims processing. Update patient insurance verification processes now to identify affected individuals and communicate the need for plan re-selection. Coordinate with Louisiana's Medicaid agency for guidance on continuity of care for patients undergoing active treatment.

Kentucky's governor and managed care organizations are at odds over proposed $330 million in Medicaid payment cuts set for the upcoming fiscal year. The insurers argue the reductions will destabilize the state's safety net and restrict patient access to care. The state contends the cuts are necessary to manage its budget. The conflict points to broader tensions as states reassess Medicaid spending post-pandemic. Monitor Kentucky's budget negotiations in the coming weeks; a finalized cut would impact provider contracts and patient assignment starting July 2027.

UnitedHealthcare's widely reported move to drop prior authorization for 1,700 services starting Oct. 1 is receiving a cautious reception from provider groups. Analysis from MedPage Today notes that while the reduction in administrative burden is welcome, it does little to address the core issue of UHC's market concentration and its power to set narrow network terms. The move comes amid growing scrutiny from state attorneys general and the Department of Justice on insurer practices. For independent practices, the change may streamline some workflows but does not alter the fundamental contracting dynamics with the nation's largest payer.

New data shows approximately 94,000 Virginians have dropped their Affordable Care Act marketplace insurance since 2025. The decline reflects the ongoing impact of the end of enhanced federal subsidies and rising premium costs, which are pushing lower-income individuals out of the commercial insurance pool. This shift increases the number of uninsured and underinsured patients, raising bad debt risk for providers. The trend is likely mirrored in other states that have not expanded Medicaid or instituted state-level subsidies. Practices in Virginia and similar markets should review their patient financial policies and charity care thresholds ahead of the 2027 open enrollment period.