The Regulator

CMS proposes cutting hospitals’ 340B drug payments by nearly 40 percent while shifting imaging scans to lower, physician-office rates, comments due August 31. The Centers for Medicare and Medicaid Services published its Calendar Year 2027 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center proposed rule today, July 7, 2026, cutting the 340B drug payment rate from average sales price plus 6 percent to average sales price minus 33.4 percent, offset budget-neutrally by an 8.44 percent increase to non-drug service payments. The rule also proposes paying physician-office rates for non-contrast imaging, such as X-rays and MRIs, delivered in certain off-campus hospital departments, a change CMS estimates would cut Medicare Part B spending by about 260 million dollars in the first year, including 70 million dollars less in beneficiary premiums. Overall payment rates would rise 2.4 percent for hospitals and ASCs meeting quality reporting requirements. The rule also adds eight botulinum toxin injection codes to the prior authorization list starting July 1, 2027, and opens a request for information on standardizing hospital price transparency data. Confidence: High. Sources: CY 2027 OPPS/ASC proposed rule, Federal Register, CMS fact sheet.

A new Medicare payment code lets primary care doctors bill for coordinating chronic-disease patients referred to outside vendors, live since July 5. CMS’s Innovation Center launched the ACCESS Model, a 10-year test in Original Medicare covering high blood pressure, diabetes, chronic musculoskeletal pain, and depression, three conditions that touch more than two-thirds of Medicare beneficiaries. Participating organizations deliver technology-supported chronic care, and referring primary care and specialist physicians can now bill a new co-management payment for reviewing and coordinating the electronic updates those organizations send back. CMS is accepting applications on a rolling basis through 2033, with the next entry points on August 17 and October 1, 2026. Confidence: High. Source: ACCESS Model overview, CMS Innovation Center.

FDA clears the first gene therapy for 2-year-olds with sickle cell disease, opening a 2.2-million-dollar treatment to 5,500 more patients. The Food and Drug Administration issued a supplemental approval on July 1, 2026, expanding Casgevy, the CRISPR-based gene therapy for sickle cell disease and transfusion-dependent beta thalassemia, down from age 12 to age 2. About 60 percent of Americans with severe sickle cell disease are covered by Medicaid, and state programs already stretched by the drug’s list price, which runs closer to 3 million dollars once four months of hospital conditioning and monitoring are added, will now field requests from far younger patients. CMS’s Cell and Gene Therapy Access Model ties state Medicaid payment to how well the therapy works, with rebates from the manufacturer if outcomes fall short. Confidence: High on the approval; Medium on Medicaid share and all-in cost, which come from state and industry estimates rather than the approval itself. Source: FDA press announcement.

The House Ways and Means Committee voted 25-15 along party lines to force nonprofit hospitals to disclose far more about their community spending. The committee passed the Tax Exempt Hospital Transparency Act, H.R. 9504, on July 1, 2026. The bill would add each hospital’s CMS certification number, and the dollar value and count of financial assistance applications received, granted, and denied, to the IRS Schedule H form nonprofit hospitals already file. Hospitals with more than 100 inpatient beds would have to report spending tied to the top three needs identified in their community health needs assessment, and hospitals with more than 100 million dollars in net patient revenue would additionally disclose advertising spending and 340B program details. The bill still needs a floor vote. Confidence: High. Sources: H.R. 9504 bill history, Congress.gov, Rep. Greg Murphy statement on committee passage.

Two federal courts fought this week over which one gets to decide the FTC’s deceptive-claims case against the group that writes pediatric gender-care guidelines. The Federal Trade Commission, joined by the attorneys general of Texas, Alaska, Iowa, and Nebraska, sued the World Professional Association for Transgender Health in Texas federal court on June 17, 2026, alleging the group misled parents and children about the safety and effectiveness of pediatric gender-transition treatment in violation of the FTC Act. WPATH has its own, separate suit against the FTC pending in Washington, D.C., arguing the agency lacks jurisdiction and that its guidelines are protected noncommercial speech. This past week, FTC and state lawyers asked the Texas judge to bar WPATH from seeking relief anywhere but that court, the Fifth Circuit, or the Supreme Court; the Texas and D.C. judges then consulted and both declined to grant that request, keeping the case pending in both courts for now. Confidence: High on the underlying lawsuit; the forum-fight detail is Medium, drawn from legal reporting rather than a court order we reviewed directly. Sources: FTC press release, case docket, Health Care Litigation Tracker.

Three states moved on pharmacy benefit managers in the same week, and none of them is Florida. Virginia’s S.B. 669 took effect July 1, 2026, banning PBMs from charging electronic claim processing fees, reversing paid claims without written notice, or cutting reimbursement below contracted rates, while requiring PBMs to pass through 100 percent of manufacturer rebates. California’s Department of Managed Health Care closed its window for PBMs to file nonconditional license applications on July 1, 2026, ahead of a January 1, 2027 deadline for every PBM operating in the state to be licensed. Ohio’s H.B. 229, enacted March 31, 2026, builds a standalone PBM licensing chapter with civil penalties up to 15,000 dollars per violation and a decade of required recordkeeping, phasing in for contracts signed or renewed on or after July 1, 2027. Confidence: High. Sources: Code of Virginia, PBM article, California PBM licensing, Department of Managed Health Care, Ohio Revised Code 3957.03.