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June 23, 2026
A recent court ruling in favor of Clover Health is leading the feds to recalculate Medicare Advantage’s star ratings for 2026, and analysts at Capstone warn that this “foreshadows [a] volatile direction” for the program.
This article was originally published on Fierce Healthcare.
Author: Darius Tahir | June 23, 2026
Bill Curry, 65, raises cattle on the same land in rural Oklahoma once owned by his father and generations before him. Each quarter, for several years, he has made the 2½-hour drive to Oklahoma City for an epidural in his spine to treat his back pain.
But this year, because of a new Medicare program, Curry has traveled a little more often.
In February, during one trip, he was told unexpectedly that he needed preapproval for the procedure. Then he went again a month or so later to get the injection, for a total of 10 hours on the road. His clinic wanted him to come in a third time, which they had never asked of him before. That appointment was “just to fill out a piece of paper to tell them how you feel again,” Curry said, so he hasn’t gone.
In January, Oklahoma became one of six states to begin a pilot program testing the use of preapprovals in traditional Medicare, the federal health insurance program for people 65 and older or with disabilities. Medicare had previously eschewed the practice — also known as prior authorization — which requires patients or someone on their medical team to seek insurance approval before proceeding with certain procedures, tests, and prescriptions.
Epidurals like Curry’s are among 13 medical services subject to the new program because the Trump administration says they’re prone to fraud or misuse. Powered by artificial intelligence, the program — called the Wasteful and Inappropriate Service Reduction Model, or WISeR — is intended to save the federal government money and protect patients from potentially unsafe or unneeded care.
Yet early reviews from Oklahoma and the other pilot states — Arizona, New Jersey, Ohio, Texas, and Washington — suggest WISeR’s rollout has not been smooth. Patients, doctors, and other healthcare professionals who spoke with KFF Health News say the effort has created confusion, errors, long wait times, and stress. Some described the rollout as “horrendous” and say people enrolled in Medicare in the pilot states are now getting ensnared in the same red tape as those with private insurance.
One key concern is that it all happened too hastily. WISeR was announced in June 2025 and launched in mid-January.
That was “quicker than normal” for the federal government, said Todd Baker, who recently stepped down as CEO of the Ohio State Medical Association. Doctors “just sort of had to figure it out,” added Jeb Shepard, director of policy at the Washington State Medical Association.
Government contractors have also acknowledged the rapid pace. “We’ve had an aggressive rollout from the time of being notified to going live,” said Jeremy Friese, CEO of Humata Health, the vendor for Oklahoma. Tech executives servicing other states have said they were still adding features to their products in the spring.
Abe Sutton, director of the Center for Medicare and Medicaid Innovation, which is administering the program, didn’t comment on the rollout schedule. But he said in a statement that the goal of these reforms is to ensure that prior authorization is efficient, fast, and streamlined.
“The model aims to reduce inappropriate care without delaying appropriate care,” he said.
Mehmet Oz, the leader of the Centers for Medicare & Medicaid Services, told NewsNation in December that they were “rolling out some prior authorization on abused practices.”
“The purpose of these is not to deny care,” Oz continued. “It’s to make sure you get the care you need and deserve, not the care some unscrupulous doctor wants to use on you.”
Medicare has struggled in recent years with suspected fraud associated with particular services. The Department of Health and Human Services’ inspector general warned in September that the program’s spending on skin substitutes, for example, had surged nearly 700% over two years, raising “major concerns about fraud, waste, and abuse.” Skin substitutes are among the 13 therapies currently subject to review under WISeR.
The program also imposes prior authorization requirements for kyphoplasty, a surgery for spinal fractures, which a report by the Medicare Payment Advisory Commission flagged as overused.
Sutton acknowledged, however, that “the percentage of providers committing waste, fraud, and abuse is small.”
Consumers and clinicians largely detest prior authorization. Even as federal health officials test the process for Medicare, the Trump administration is trying to scale it back for those with private insurance. According to a KFF poll conducted in January, 69% of insured adults consider prior authorization a burden for care.
Through WISeR, doctors and their staff log in to online portals to submit medical records that justify the procedures. Using artificial intelligence, the systems quickly approve applications that meet the program’s criteria, Friese, Humata’s chief executive, told KFF Health News. He said there is an “immediate yes” in 88% of cases for which clinical data supports an approval.
CMS has touted the process as one in which decisions are returned within 72 hours. After that, clinicians receive a “universal tracking number,” which allows them to schedule the procedure and get paid. In practice, however, participants say the process is anything but easy.
The University of Washington’s medical system alone had nearly 100 patients waiting earlier this year for epidural injections due to WISeR-related delays, according to an April report from the office of U.S. Sen. Maria Cantwell (D-Wash.) that drew on hospital association data. “Now, patients are subject to delays or denials which did not exist prior to the WISeR Model,” the report said.
Curry, the Oklahoma cattle farmer, said he might go to Kansas for future treatments to avoid the approval process. Dorota Gribbin, a New Jersey-based physical medicine and rehabilitation physician, said that by the time authorization came for one of her patients who needed a back pain procedure, the patient had gone to the hospital for more expensive care.
Jennifer Valle, a precertification and insurance supervisor at Clinical Radiology of Oklahoma, said when it comes to kyphoplasties, there has been a lot of “nitpicking” from reviewers. Other times, information her practice provides to CMS gets overlooked, she said, and reviewers ask for imaging that’s already in the file.
Claims with no problems are supposed to be paid within 15 days, said James Webb, a musculoskeletal radiologist in Tulsa, Oklahoma, who has also been frustrated by the prior approval and reimbursement process for kyphoplasties. “Six- to eight-week delays is what we’ve been seeing,” he said.
“It’s been horrendous,” said Jerry Sobel, a Phoenix-area pain management doctor. “Right from the beginning, there seemed to be no organization.” Sobel said that as of May, he hadn’t gotten paid by Medicare for nine epidurals.
“We continuously monitor operations and work closely with stakeholders to address questions and improve the provider experience,” said Sundar Subramanian, the CEO of Zyter, which has the contract for Arizona.
During an April webinar, another Zyter executive acknowledged a large backlog in payments stretching to January. Those backlogs “are currently being resolved,” Medicare’s Sutton said, without providing further detail.
When asked about other issues — including what doctors suspect are AI-driven errors — Medicare’s Sutton said the agency appreciates “feedback on provider experience.” It will be used “to help providers better understand WISeR processes,” he said.
Although CMS vendors say humans make the final decisions on approvals, doctors and their staffs believe artificial intelligence is playing a large role in the process and that denials are sometimes the result of AI hallucinations that garble or make up information.
One Arizona doctor, who wasn’t authorized by his practice to speak, recalled a denial saying his patient wasn’t eligible for procedures in the thoracic region, or mid-back. The patient needed an injection to the neck. Webb, the Oklahoma radiologist, documented four times that a patient lacked numbness, and yet his WISeR application was still denied, citing numbness, which, in the reviewer’s interpretation, would rule out the spinal surgery procedure.
Friese, Humata’s CEO, said he hasn’t heard about any AI hallucinations.
The process is also raising government costs. With more rejections, more appeals are being filed with Medicare’s administrative contractors. The government pays the contractors to handle the appeals, and Medicare’s Sutton acknowledged that the agency has “accounted for potential changes in the volume of Medicare appeals because of the WISeR program and its associated costs.”
Eighty-four percent of commercial insurers already use AI tools, according to a survey released in 2025 by the National Association of Insurance Commissioners, though they have consistently said AI isn’t used to deny prior authorization requests.
Its use in Medicare risks introducing friction and frustration into the program — and piling costs onto its beneficiaries. Prior authorization saves money for insurers partly by making patients pay a price in wait times and inconvenience, said Miranda Yaver, a University of Pittsburgh health policy researcher studying the technique.
“People will end up getting ensnared in a lot of red tape, having to be on hold, and getting rerouted,” she said. She often wonders whether prior authorization simply shifts costs to patients and doctors, rather than saving them.
Some doctors involved in Medicare’s prior authorization experiment believe it will inevitably expand beyond a few services officials in Washington consider fraud-prone.
“Everybody knows that if this pilot project works, it will be prior auth for basically all procedures,” said Mary Clarke, a family practice physician in Stillwater, Oklahoma. “If they can show that they can save money, then that’s going to be extrapolated and rolled out to other procedures and multiple other things in other states.”
When asked whether CMS is considering expansion of its prior authorization pilot, Sutton said in his statement that there are “currently no changes” considered for the list of services subject to the WISeR program, “but CMS continues to assess whether any changes are warranted.”
Do you have an experience with prior authorization you’d like to share? Click here to tell KFF Health News your story.
KFF Health News Southern correspondent Lauren Sausser contributed to this report.
KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF—an independent source of health policy research, polling, and journalism. Learn more about KFF.
This <a target="_blank" href="https://kffhealthnews.org/medicare/medicare-ai-prior-authorization-wiser-delays-errors/">article</a> first appeared on <a target="_blank" href="https://kffhealthnews.org">KFF Health News</a> and is republished here under a <a target="_blank" href="https://creativecommons.org/licenses/by-nc-nd/4.0/">Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License</a>.<img src="https://kffhealthnews.org/wp-content/uploads/sites/8/2023/04/kffhealthnews-icon.png?w=150" style="width:1em;height:1em;margin-left:10px;">
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This article was originally published on KFF Health News.
Author: MedLearn Media | June 22, 2026
Special Giveaway Kicks Off IPPSpalooza, education designed to Help Healthcare Organizations Move from Final Rule Analysis to Implementation Readiness
Inver Grove Heights, MN, June 23, 2026 — Healthcare organizations across the country are preparing for one of the most significant annual regulatory events they face: implementation of the FY 2027 Inpatient Prospective Payment System (IPPS) Final Rule, affecting hospital reimbursement, coding, quality reporting, compliance, and operational planning.
To help healthcare professionals navigate the changes ahead, ICD10monitor is launching IPPSpalooza 2027, a comprehensive educational initiative dedicated to helping hospitals and health systems identify key regulatory changes, assess operational impacts, and prepare for successful implementation by October 1.
IPPSpalooza begins June 23 with a special giveaway designed to provide healthcare professionals with valauble education and expert guidance as they prepare for FY 2027.
Three winners will be selected to receive:
The giveaway serves as the official kickoff to a season of IPPS-focused education that will include podcasts, breaking news coverage, expert articles, webcast programming, and in-depth analysis from some of healthcare’s leading reimbursement, coding, compliance, and revenue cycle experts.
“The biggest challenge isn’t finding the Final Rule—it’s understanding which changes will affect reimbursement, coding, compliance, and operations, and then translating those changes into action before October 1,” said Angela Kornegor, Senior Vice President of Education.
“IPPSpalooza was designed to help healthcare professionals do exactly that by providing trusted analysis, practical guidance, and expert insight throughout the entire implementation journey.”
Throughout the next few months, ICD10monitor will deliver ongoing coverage of Final Rule developments, helping hospitals and health systems identify key changes, understand potential impacts, and prepare for implementation.
At the center of this effort is the FY 2027 IPPS Masterclass, a comprehensive educational program featuring expert-led sessions designed to help healthcare professionals identify the changes that matter most and develop actionable implementation strategies before the new regulations take effect.
As October 1 approaches, IPPSpalooza will continue providing the resources healthcare professionals need to move from uncertainty to action.
Healthcare organizations interested in participating can visit ICD10monitor.com to enter the giveaway and follow ongoing IPPSpalooza coverage throughout the season.
Because when the Final Rule arrives, preparation isn’t optional. Navigate it with ICD10monitor.
This article was originally published on RACmonitor.
June 22, 2026
Elevance Health is making strides toward a simpler and more streamlined clinical review process through its Health OS platform.
This article was originally published on Fierce Healthcare.
Author: Penny Jefferson, MSN, RN, CCDS, CCDS-O, CCS, CDIP, CRC, CHDA, CRCR, CPHQ, ACPA-C | June 22, 2026
Hospitals have spent years building documentation, coding, utilization review (UR), and quality programs around the inpatient encounter. The chart was reviewed, coded, billed, audited, appealed, and measured largely within a hospital’s four walls.
That framework is no longer enough.
With the Transforming Episode Accountability Model, known as TEAM, and the proposed Comprehensive Care for Joint Replacement Expanded Model, known as CJR-X, the Centers for Medicare & Medicaid Services (CMS) is continuing to move hospitals deeper into episode-based accountability. These models do not simply involve asking whether the procedure was coded correctly or whether the inpatient admission met criteria, but whether the entire episode of care was coordinated, clinically supported, risk-adjusted, and defensible across settings.
For clinical documentation integrity (CDI), coding, UR, quality, case management, revenue cycle, and physician advisor teams, this is a major signal. Documentation integrity is no longer just a back-end billing function; it must be built into the surgical pathway from the beginning.
TEAM is already underway. CMS describes TEAM as a mandatory, five-year episode-based payment model running from Jan. 1, 2026 through Dec. 31, 2030, for selected acute-care hospitals in selected Core-Based Statistical Areas.¹ TEAM applies to original Medicare beneficiaries undergoing one of five surgical categories: lower extremity joint replacement, surgical hip and femur fracture treatment, spinal fusion, coronary artery bypass graft, and major bowel procedures.¹
Each episode begins with the hospital inpatient stay or hospital outpatient procedure and extends through 30 days after the patient leaves the hospital.¹ That matters because the hospital’s accountability does not stop when the patient is discharged; it follows the patient into the post-acute recovery period.
CJR-X is different, but the direction is the same. CMS proposed CJR-X in the Inpatient Prospective Payment System (IPPS) proposed rule for the 2027 fiscal year (FY).²³ If finalized as proposed, CJR-X would expand the prior Comprehensive Care for Joint Replacement model and would begin Oct. 1, 2027.²³ The model would focus on original Medicare beneficiaries undergoing hip, knee, and ankle replacements (also called lower-extremity joint replacements) in the inpatient and hospital outpatient settings.²³
CJR-X would use a longer episode window than TEAM. CMS states that CJR-X would hold participating hospitals accountable for lower-extremity joint replacement episodes, beginning with the procedure and ending 90 days after discharge from inpatient hospitalization or after an outpatient procedure.² CMS also notes that hospitals participating in TEAM would be excluded from CJR-X while TEAM is active.²
For CDI and coding teams, the message is clear. The coded claim still matters, but the larger question is whether the documentation supports the full story of the episode.
That story starts before the procedure. It includes why the patient required surgery, whether inpatient or outpatient care was appropriate, what comorbid conditions increased risk, what complications occurred, what monitoring and treatment were required, what discharge needs existed, and whether the recovery plan was coordinated after discharge.
For CDI professionals, this means the documentation opportunity is not limited to capturing complications and comorbidities or major complications and comorbidities (CCs and MCCs). Accurate severity-of-illness and risk adjustment still matter. But under episode-based models, documentation must also explain why the patient used the resources they did.
A lower-extremity joint replacement patient with chronic kidney disease, heart failure, morbid obesity, diabetes with complications, chronic respiratory disease, malnutrition, frailty, baseline functional limitation, chronic anticoagulation, or poor social support is not the same episode as a healthier patient undergoing the same procedure. The procedure may look similar, but the risk is not.
The documentation must make that difference visible.
This does not mean querying for diagnoses not clinically supported. In fact, these models make clinical validation even more important. If a diagnosis is coded but not substantiated, it creates risk. If a complication is labeled inaccurately, it creates quality risk. If a clinically significant condition is never documented, the record may understate the patient’s complexity.
The goal is not to make the patient chart look “sicker,” but rather to ensure that the record accurately reflects the patient’s condition, treatment, risks, and resource needs.
Coding teams also play a critical role. Episode models depend on accurate identification of the anchor procedure, correct claim assignment, appropriate reporting of secondary diagnoses, and careful distinction between expected postoperative findings and reportable complications.
Coders need clear documentation to distinguish acute blood loss anemia from expected blood loss, postoperative respiratory failure from routine ventilatory support, acute kidney injury from mild transient creatinine changes, and true surgical complications from clinically insignificant findings.
This is where coding and CDI must be tightly aligned. The question cannot be limited to “will this change the DRG?” The better question is, “does the record accurately and defensibly explain this patient’s episode of care?”
UR and physician advisor teams must be part of the same conversation. TEAM and CJR-X both include hospital outpatient procedures, and TEAM also includes inpatient stays.¹² That brings status integrity, medical necessity, and site-of-service documentation directly into the episode accountability discussion.
For planned procedures, the record should support why the selected setting was appropriate. If inpatient status is used, the documentation should explain the patient-specific risk factors, expected intensity of services, anticipated monitoring needs, or clinical barriers that make outpatient management inappropriate.
For urgent or emergent cases, such as hip-fracture repair, the record should clearly describe the acute event, baseline function, comorbidities, perioperative risk, and discharge barriers. These cases are often complex, yet the documentation may remain procedure-focused. If the record only portrays the procedure details the patient’s true severity and resource needs may be lost.
Case management and post-acute partners are just as important. TEAM requires hospitals to refer patients to primary care services to support continuity of care and long-term outcomes.¹ CJR-X is designed to encourage coordination across settings, including transitions from hospitalization or an outpatient procedure through recovery.²
That means that discharge disposition, home health, skilled nursing facility (SNF) placement, rehabilitation needs, durable medical equipment (DME), follow-up appointments, medication changes, caregiver support, and primary care connection all can influence the episode outcome.
Poor transitions can lead to avoidable emergency department visits, readmissions, complications, and increased costs. Strong transitions can support safer recovery and better performance under episode-based accountability.
Quality teams must also be at the table. TEAM quality scoring uses selected measures related to care coordination, patient safety, and patient-reported outcomes. CMS has stated that these measures are used to calculate the Composite Quality Score, which then adjusts TEAM reconciliation amounts based on quality performance.⁴
CJR-X also ties quality to payment. CMS describes a “quality-first principle,” meaning hospitals would need to meet a minimum episode quality level before receiving reconciliation payments. The proposed CJR-X quality measures include complication rate, outpatient hospital visits after surgery, Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS), Outpatient and Ambulatory Surgery Consumer Assessment of Healthcare Providers and Systems (OAS CAHPS), and patient-reported outcome performance measures.²
This is why documentation accuracy matters beyond reimbursement. Documentation that misclassifies complications, misses present-on-admission conditions, fails to describe clinical context, or does not support the patient’s risk profile can affect both payment and quality interpretation.
The biggest mistake hospitals can make is treating TEAM and CJR-X as finance-only initiatives.
Finance may calculate exposure. Analytics may identify included cases. But the work of succeeding under these models sits inside clinical documentation, coding accuracy, care coordination, medical necessity, discharge planning, physician engagement, quality review, and denial prevention.
Hospitals should begin by establishing a cross-functional episode-accountability workflow. The first step is early case identification. Scheduling, surgery, registration, CDI, coding, UR, case management, quality, revenue cycle, and analytics need to know which cases trigger the model, which patients are included, whether the case is inpatient or outpatient, and where the patient is in the episode timeline.
The second step is creating a documentation-focused list for high-risk episode populations. For joint replacement, this may include obesity, diabetes complications, chronic kidney disease, heart failure, chronic lung disease, anemia, malnutrition, frailty, pressure injury risk, anticoagulation issues, prior falls, baseline mobility, and post-acute care needs.
For coronary artery bypass grafting (CABG), documentation should clearly support cardiac acuity, heart failure status, arrhythmia, renal function, shock, respiratory complications, vascular disease, and postoperative events.
For major bowel procedures, teams should watch for sepsis, perforation, obstruction, malnutrition, ostomy status, ileus, acute kidney injury, anemia, infection-related complications, and postoperative recovery barriers.
The third step is aligning query practices with compliance. Queries should remain clinically supported, nonleading, and focused on clarity in documentation. Under episode models, CDI teams should not query only when there is a potential DRG impact. They should also consider whether documentation affects severity, risk adjustment, quality interpretation, medical necessity, discharge planning, and audit defensibility.
The fourth step is strengthening provider education. Surgeons and proceduralists may not think in terms of episode spending, post-acute accountability, quality scoring, risk adjustment, or denial exposure. Education should be practical. Document the reason for the procedure, why the setting was appropriate, patient-specific risk factors, baseline function, complications when they occur, clinically significant comorbidities, and the rationale for post-acute needs.
The message should not be “document more,” but rather “document the clinical reasoning that explains this patient’s episode.”
The fifth step is creating a concurrent or pre-bill review process for high-risk episodes. Hospitals should consider focused review before final billing when there are significant complications, unexpected readmissions, high-cost post-acute use, unclear status, conflicting documentation, or diagnoses that may be vulnerable to clinical validation review.
This is especially important when the record includes terms such as postoperative, expected, complication, clinically insignificant, acute, chronic, resolved, history of, or due to. Those words can change coding, quality, medical necessity, and denial exposure.
Finally, hospitals need metrics. Episode accountability should be tracked by service line, provider, procedure category, payer, discharge disposition, readmissions, emergency department use, complications, query trends, denial trends, medical necessity issues, and documentation gaps.
Without data, organizations will not know whether they have a documentation problem, a coding problem, a care transition problem, a utilization problem, a quality problem, or all of the above.
CMS has reported that the prior CJR model generated $112.7 million in Medicare savings while maintaining quality for more than 98,000 knee and hip replacement patients across 323 hospitals from 2021 through 2023.⁵ CMS also stated that lessons learned from CJR informed the design of TEAM.⁵
That should get our attention.
TEAM and CJR-X are not just payment models, but a preview of where documentation integrity is headed. Hospitals are increasingly accountable for what happens before admission, during the stay, after discharge, and across recovery.
For CDI and coding professionals, this is an opportunity to lead. We understand how clinical language becomes coded data. We understand how documentation affects severity, quality, reimbursement, denials, public reporting, and resource utilization. We also understand the risk of getting it wrong.
The organizations that perform well under episode-based models will not be the ones that chase codes at the end of the stay. They will be the ones who build documentation integrity into the surgical pathway from the beginning.
The future of episode accountability is not just bundled payment. It is a bundled responsibility. CDI, coding, UR, quality, case management, revenue cycle, and physician advisors all own a piece of that story.
This article was originally published on RACmonitor.
Author: Tiffany Ferguson, LMSW, CMAC, ACM | June 22, 2026
The Centers for Medicare & Medicaid Services (CMS) recently issued an Interim Final Rule with Comment (CMS-2454-IFC) implementing the Medicaid Community Engagement Requirement established under Public Law 119-21, referred to by CMS as the Working Families Tax Cut (WFTC) legislation. Beginning no later than Jan. 1, 2027, certain adults ages 19 through 64 will be required to complete at least 80 hours per month of qualifying activities, including employment, education, job training, or community service, as a condition of Medicaid eligibility.
While much of the public discussion surrounding Medicaid work requirements has focused on employment, the more significant operational questions may center on implementation, verification, and access to care. For healthcare organizations, the issue is less about whether beneficiaries should work and more about how states and providers will determine eligibility for work.
The rule applies to non-pregnant adults between the ages of 19 and 64 who are not entitled to Medicare and receive coverage through Medicaid expansion populations or certain Section 1115 demonstrations.
Individuals may satisfy the requirement through multiple pathways. In addition to qualifying activities, beneficiaries may demonstrate compliance through earnings equal to at least 80 times the federal minimum wage, which equates to approximately $580 per month in 2026. Activities may be combined to meet the monthly threshold. States are required to verify compliance with application and renewal. If compliance cannot be verified, states must provide notice and allow beneficiaries 30 calendar days to demonstrate compliance or establish that they qualify for an exemption before denying or terminating coverage. Failure to do so may result in disenrollment, although individuals may reapply at any time.
At initial application, states may require individuals to demonstrate compliance during one to three months preceding enrollment. At renewal, beneficiaries must show compliance for one or more months during the prior eligibility period. These lookback periods introduce an entirely new layer of eligibility complexity.
Congress excluded several populations from the requirement, including pregnant and postpartum individuals, indigenous peoples, certain caregivers, individuals already satisfying Supplemental Nutrition Assistance Program (SNAP) or Temporary Assistance for Needy Families (TANF) requirements, and persons considered medically frail. States may also grant temporary hardship exceptions for individuals receiving inpatient hospital services, traveling for specialized medical care, residing in areas experiencing nationally declared disasters, or living in counties with high unemployment.
Perhaps the most important question raised by the rule is not who must work, but who determines when someone is unable to.
The Interim Final Rule requires states to use all available reliable information, including adjudicated claims and encounter data from the previous 12 months, before requesting additional information from beneficiaries. States must verify not only that a diagnosis exists, but that the condition significantly impairs the individual’s ability to comply with the community engagement requirement. Beginning Jan. 1, 2028, self-attestation for medical frailty may generally be used only once, when claims data are unavailable. Subsequent determinations may require additional documentation. This distinction is critical.
According to the ruling, possessing a diagnosis alone does not automatically establish medical frailty. The rule requires evidence that the condition meaningfully limits the person’s ability to meet the requirement. Consequently, physicians and other clinicians may increasingly be asked to certify not simply the presence of cancer, chronic pain, depression, substance use disorders, or cognitive impairment, but the functional consequences associated with those conditions. This would likely be similar to disability determinations and Family and Medical Leave Act (FMLA) certifications, wherein providers may find themselves completing forms, supplying medical records, and responding to requests from state agencies.
Healthcare organizations are already facing increasing administrative responsibilities; the addition of Medicaid work requirement exemptions introduces another layer of documentation and additional risk of administrative burnout.
Providers may be asked to certify medical frailty or functional limitations, verify temporary inability to work following hospitalization, respond to state requests for information, and/or participate in appeals processes when eligibility is denied. These responsibilities are unlikely to generate reimbursement and may disproportionately affect safety-net hospitals, rural providers, and organizations serving large Medicaid populations.
Although CMS has committed approximately $200 million in grants and announced more than $600 million in private-sector technology support to assist implementation, this is going to be a significant lift to operationalize. Perhaps the greatest concern associated with work requirements is not whether beneficiaries are employed, but whether otherwise eligible individuals may lose coverage because of administrative complexity.
Past experiences with Medicaid work requirements demonstrated that coverage losses often occurred because individuals could not navigate reporting requirements, not because they failed to satisfy them. Individuals with behavioral health conditions, unstable housing, low health literacy, transportation challenges, or limited access to technology may encounter difficulties complying with complex documentation requirements, even when they qualify for exemptions.
Coverage interruptions may result in delayed care, medication nonadherence, increased emergency department utilization, avoidable hospitalizations, and rising rates of uncompensated care for providers.
CMS views the Community Engagement Requirement as a pathway toward economic independence and poverty reduction. Whether these goals are achieved will depend not only on employment opportunities, but also on how effectively states and healthcare systems operationalize the requirements without creating unintended barriers to care.
This article was originally published on RACmonitor.
Author: Maureen Testoni, Esq. | June 17, 2026
There has been a troubling new development involving Eli Lilly and the 340B drug pricing program.
For several months, Lilly has been demanding that hospitals submit millions of lines of claims data for drugs dispensed from hospitals’ own retail and mixed-use pharmacies. Now, the company is threatening to soon deny 340B pricing for hospitals that do not comply.
Earlier this month, Lilly informed the federal government that it had begun sending ultimatum letters to selected hospitals. Those letters informed hospitals that they had just five business days to begin submitting claims data to the company, or risk losing 340B pricing on Lilly drugs. We have confirmed that some hospitals received those notices, and Lilly has indicated that more letters will follow in the coming months.
This is a significant, and 340B Health believes, unlawful, threat. The 340B statute requires drug companies to provide discounted pricing to eligible hospitals. It does not require hospitals to hand over large volumes of patient data to drug companies as a condition of receiving those discounts.
Yet Lilly is attempting to create its own reporting requirements and then attach severe financial consequences to hospitals that do not comply.
We urged the government to take enforcement action. If a drug company can decide on its own that hospitals must hand over the data before receiving 340B pricing, it raises fundamental questions about whether statutory discounts remain statutory discounts or become something companies can withhold whenever they choose.
Lilly claims that two appellate court decisions from several years ago permit the company to take this action. We strongly disagree with that interpretation. Those decisions did not give drug companies unlimited authority to impose whatever requirements they want on 340B hospitals, nor did they authorize companies to terminate 340B pricing because hospitals decline to provide data that federal law does not require them to submit.
Lilly’s actions carry implications well beyond a single company. If Lilly succeeds in withholding 340B pricing based on its own claims-data requirements, other drugmakers will have every incentive to adopt similar policies. In fact, a number of large drugmakers have already adopted Lilly policies, and their deadlines are coming up. Hospitals could find themselves responding to different reporting mandates from multiple manufacturers, creating enormous administrative burden and unlawfully increasing costs for 340B-eligible safety-net hospitals.
Drugmakers claim they need the data for program integrity, asserting that 340B providers are misusing 340B. Yet none have released data to prove that point! They claim 340B has grown significantly over the years, but that has nothing to do with alleged misuse of 340B. Quite the opposite, in fact: 340B applies only to outpatient drugs, and outpatient visits have grown tremendously since the program was enacted in 1992. Expensive specialty drugs, which barely existed in 1992, can now replace the need for heart surgery and other invasive procedures, and make up more than half the drug market. 340B hospitals, with their many specialties, are significant prescribers of these drugs to patients, and their patients include a disproportionate share of low-income individuals who would not otherwise have access to this level of care.
For safety-net hospitals and their patients, the stakes are high. Every dollar lost through denied 340B pricing is a dollar that cannot be used to support patient care, expand services, or serve vulnerable communities.
340B hospitals remain focused on their mission, and 340B Health will continue advocating for federal action to ensure that drug companies follow the law – so hospitals can continue serving the patients who depend on them.
This article was originally published on RACmonitor.
Author: Ronald Hirsch, MD, FACP, ACPA-C, CHCQM, CHRI | June 17, 2026
Today I have three U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) reports to discuss, but first, an update on the Wasteful and Inappropriate Service Reduction (WISeR) program.
Once again, it appears that Congress is not happy with the Centers for Medicare & Medicaid Services (CMS) program to pay artificial-intelligence (AI) companies to use their tools to review prior authorizations for a select list of services; they have added an amendment to the budget bill that would cease all funding for the program. To quote a letter from members of Congress to the U.S. House of Representatives Appropriations Committee, “It is also troubling that WISeR contractors, those actually doing the prior authorization, are compensated via a percentage of the dollar value of the services they deny. This payment mechanism clearly creates a perverse incentive to deny care, putting traditional Medicare beneficiaries at greater risk of not receiving needed care. Prior authorization has long been abused. It is bad for patients and providers.”
Now, to the OIG reports. Last week they released two reports looking at prior authorization denials by Medicare Advantage (MA) plans for care at skilled nursing facilities (SNFs), inpatient rehabilitation facilities (IRFs), and long-term acute-care hospitals (LTACHs). And as you could probably guess, MA plans denied a lot of SNF requests.
Looking at June 2024, a total of 12 percent of all requests were denied. But even more shocking is that if the denial was appealed, 95 percent of the time, the denial was overturned. That includes a 99.7-percent overturn rate for UnitedHealthcare’s (UHC’s) 1,025 SNF denials.
And the numbers are no better for IRFs or LTACHs, with 54 and 65 percent of their respective requests denied. Appeals were also commonly overturned for them, with 36 percent of LTCH denials overturned and 43 percent of IRF denials overturned. And for all three types, it took an average of five days for an appeal to be reviewed, with CMS noting that “unnecessary or avoidable days spent in a hospital can mean a significant financial cost to hospitals that is not separately reimbursable.
Delayed discharges can also negatively affect patients’ psychological and social well-being and contribute to feelings of uncertainty and stress about their recovery and prognosis.”
The OIG made several recommendations to CMS to address these startling findings, but will anything change? Only time will tell.
The third OIG report was the first hospital review we have seen in a while, and Lehigh Valley Hospital in Pennsylvania was the lucky recipient. As usual, the OIG zeroed in on short inpatient admissions, finding an error rate of 42 percent.
I always hope that the OIG will give us worthwhile information on the denied cases, so we can better understand their interpretation of the Two-Midnight Rule, but once again I was disappointed. They gave details of one denied admission: a patient admitted for left-hip and lower-back pain with impaired ambulation.
The enrollee was treated and evaluated by a physician, then was discharged after assessment by an occupational therapist. While we have no other case details, that seems like a weak inpatient admission.
But the cases that Lehigh Valley presented in their rebuttal letter as admissions that should have been approved seemed to meet the case-by-case exception. For me, it once again calls into question the ability of the OIG contractor to properly interpret the rule and apply the correct exception. Because of that, I will continue to advocate for an explicit statement from the physician that the patient’s high risk or high severity or complexity warrants inpatient admission, rather than simply listing the risk or severity factors.
As I discussed last week, we shouldn’t have to alter our behaviors to meet the inappropriate actions of others, but it may just be a reality of our system.
This article was originally published on RACmonitor.
June 17, 2026
While AI spending in healthcare nearly tripled to $1.4 billion in 2025, a typical health
system coordinates dozens of distinct vendors for AI and automation solutions,
ranging from ambient AI scribes to AI-driven prior authorization apps.
This article was originally published on Fierce Healthcare.
June 16, 2026
A final rule updates performance reviews, codifies existing requirements and brings new conflict-of-interest protections for the nine organizations that regularly survey and accredit more than 9,000 providers participating in Medicare.
This article was originally published on Fierce Healthcare.
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