As the Senate returns, internal rifts over Medicaid policy are putting Republican leadership to the test. At the same time, HHS is tightening enforcement on transparency rules and floating controversial nutrition reforms. States are battling over PBM reform in the courts, while industry players brace for both tech disruption and new public health scrutiny. Let’s dive in.

In this week’s Nimitz Health:

• Federal News: GOP infighting over Medicaid heats up, Trump tightens price transparency rules, and RFK Jr. sets his sights on Big Food.

• State News: Arkansas and Georgia face high-profile legal fights over PBM ownership and arbitration practices.

• Industry News: HHS pulls Moderna vaccine funding, hospitals embrace robots, and alcohol giants brace for global health crackdowns.

WHO’S HAVING EVENTS THIS WEEK?

Wednesday, June 4th

• Senate HELP Committee: “Hearings to Examine the Reauthorization of the Over-The-Counter Monograph Drug User Fee Program” at 10am. Watch here.

Thursday, June 5th

• House Appropriations Interior, Environment, & Related Agencies Subcommittee: “Indian Health Service Budget Hearing” at 1:30pm. Watch here.

NEWS DRIVING THE WEEK

Federal News

Senate Republicans face internal divisions as they prepare to advance a reconciliation package that includes major Medicaid reforms. Led by Sen. John Thune, leadership is pressing for provisions that would cap Medicaid spending and tighten eligibility — proposals likely to alienate “Medicaid moderates” in the caucus who hail from states that expanded coverage under the ACA. Thune has reportedly told colleagues that “there’s no room for freeloaders,” reflecting the urgency among conservatives to rein in entitlement growth, even at the risk of intraparty friction.

Meanwhile, House Republicans are sounding the alarm over potential pharmaceutical tariffs under consideration by the Commerce Department. In a letter led by Reps. Nicole Malliotakis and Greg Murphy, 20 GOP members of the Ways and Means Committee urged the administration to narrowly target China, warning that broader measures could lead to drug shortages and price hikes that affect U.S. patients.

On the regulatory front, the Trump administration rolled out a robust update to its hospital and insurer price transparency rules. The new guidance requires that hospitals post actual prices rather than estimates and clarifies compliance expectations for insurers, including on prescription drug costs. The multi-agency push, stemming from a February executive order, is aimed at correcting what the administration claims was “inadequate enforcement” under Biden. Agencies are also soliciting public input on how to improve transparency enforcement frameworks moving forward.

Finally, HHS Secretary Kennedy’s “Make America Healthy Again” platform is turning its focus to Big Food. New initiatives include proposed SNAP restrictions on sugary drinks and ultra-processed snacks, plans to eliminate artificial food dyes, and the rollout of dietary guidelines that ban added sugar. Advocates argue the changes are long overdue, while critics accuse Kennedy of politicizing nutrition science and overreaching federal authority.

State News

In Arkansas, CVS Health and Cigna have filed a federal lawsuit seeking to overturn a newly passed law banning pharmacy benefit managers (PBMs) from owning pharmacies. The companies argue that the law violates federal ERISA regulations and would dismantle the current delivery model used by major health plans. The lawsuit signals escalating tensions as more states introduce similar PBM restrictions in an effort to curb drug prices and vertical consolidation.

Georgia has become the focal point of an unusual legal dispute involving the No Surprises Act. Elevance Health has sued several local providers, alleging they manipulated the independent dispute resolution (IDR) system by submitting bundled and ineligible claims, inflating arbitration awards by as much as 900%. The case could influence future guidance on how the arbitration process is administered nationwide.

Industry News

In a surprise decision, HHS canceled nearly $590 million in pandemic preparedness funding earmarked for Moderna’s avian flu mRNA vaccine. Despite encouraging early trial data, the administration deemed further investment “not scientifically or ethically justifiable.” Moderna says it will pursue alternative paths for the vaccine’s development.

Alcohol industry leaders are scrambling to respond to what they fear is a mounting “tobacco moment.” Following the WHO’s declaration that there is “no safe level” of alcohol consumption and new calls from U.S. officials for cancer warnings on labels, beverage giants are pivoting to a messaging campaign focused on the “social benefits” of moderate drinking. Industry groups are lobbying aggressively to prevent new regulations ahead of updated U.S. dietary guidelines and a major UN health meeting this fall.

And finally, in hospitals nationwide, automation is expanding from surgical suites to supply closets. Service robots like Moxi are increasingly deployed to handle deliveries and logistical “busy work,” saving nurses hours of time daily. With staffing shortages at crisis levels, these robots are being embraced by clinical staff, a rare win for health tech that doesn’t come with clinical decision-making baggage.

FOR FUN

Calling all theatre nerds! Les Misérables is coming to the Kennedy Center June 11th-13th. Get your tickets here.

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