RISE summarizes recent regulatory-related headlines and reports.
Government funding bill prevents anticipated Medicare cuts
The spending measure approved by Congress and signed into law this week includes a provision to waive budget rules that would have included Medicare cuts of nearly $500 billion. Modern Healthcare reports that the legislation eliminates the need to offset the Statutory Pay-As-You-Go Act of 2010, or PAYGO’s $3.4 trillion in deficit spending over 10 years. The legislation resets the Office of Management and Budge’s deficit scorecard to zero for the remainder of the year, according to the publication.
Democrats introduce legislation to block Medicare WISeR model
A group of six Democratic lawmakers have introduced legislation that would repeal the Centers for Medicare & Medicaid Services’ Wasteful and Inappropriate Service Reduction (WISeR) model. The Medicare model introduces new prior authorization requirements using enhanced technology in traditional Medicare in six states beginning 2026.
But the model would be dismantled under “The Seniors Deserve SMARTER (Streamlined Medical Approvals for Timely, Efficient Recovery) Care Act,” which is sponsored by Representatives Suzan DelBene (D-Wash.) Greg Landsman (D-Ohio) Ami Bera, M.D. (D-Calif.) Kim Schrier, M.D. (D-Wash.) Mark Pocan (D-Wisc.) and Rick Larsen (D-Wash.)
In an announcement, the lawmakers expressed concern that prior authorization has led to limitations on access to care within Medicare Advantage and the WISeR model would make the problem worse by empowering artificial intelligence to make health care decisions.
States take action against insurer downcoding
Several states are pushing back against attempts by health insurers to “downcode” medical claims by providers, according to Modern Healthcare. The practice reduces claims to lower levels of service if automated systems or reviewers determine documentation does not justify higher level codes that were initially billed. While Arkansas and Virginia have passed laws to limit downcoding, physician groups and lawmakers in Ohio, New York, Connecticut, New Jersey, and Utah are debating similar legislation, the publication reports.
Report provides health plan outlook for 2026
Health insurers will face intensifying competition from employer partners and direct-to-consumer models that may bypass traditional insurers, according to the U.S. Health Insurance Outlook for 2026, an annual report from Numerof & Associates, a strategy and implementation consultancy that is focused on health care organizations navigating industry-wide transition.
“The health care sector is entering 2026 amid a perfect storm of political, financial and operational pressures,” said Rita Numerof, Ph.D., president of Numerof & Associates, in an announcement. “Across the board, organizations are being forced to adapt. To succeed, they must fundamentally rethink their business models to demonstrate value, manage risk and improve outcomes.”
For health insurers, the outlook notes that as political and legislative uncertainty persists, payers must demonstrate value to plan sponsors and consumers, expand risk-based contracting, and invest in AI and analytics to manage cost and performance.