INSIDE THE ISSUE

> MHA’s Legislative Priorities
> NIH Cuts Halted Until Friday
> Medicaid Under Attack
> Extending the Extensions
> Flu Cases Spike
> Transition

MONDAY REPORT

Workplace Safety, Finances, and More Head MHA Legislative Priorities

When all tallied, the number of bills filed in the 2025-2026 Massachusetts legislative session – the 194th General Court – will most likely top 8,000. Among those are approximately 28 that MHA secured sponsors for, along with a few dozen more that advance proposals from other healthcare-related interests with which MHA is allied.

Topping MHA’s workforce bills is An Act Requiring Healthcare Employees to Develop & Implement Programs to Prevent Workplace Violence, filed by Rep. John Lawn (D-Watertown) and Sen. Joan Lovely (D-Salem). This bill, supported in partnership with the two largest healthcare labor unions in the state –the Massachusetts Nurses Association and 1199SEIU – takes the necessary steps to ensure worker safety and contains strong enforcement measures.

A number of MHA bills focus on healthcare finance, including An Act to Address the Financial Stability of the Health Safety Net (HSN), which has taken on added importance as the safety net is running shortfalls not seen since before the historic universal coverage reform law in 2006. Currently, while hospitals and insurers are assessed to fund the HSN, hospitals alone must make up any funding shortfall, which this year is expected to exceed $200 million. MHA’s bill would require commercial insurance companies to share in the cost of the shortfalls. The “shared responsibility” bill would also require the state to contribute more to the shortfall.

An Act to Improve Health Insurance Prior Authorization (House) and An Act Relative to Reducing Administrative Burden (Senate), from Rep. Marjorie Decker (D-Cambridge) and Sen. Cindy Friedman (D-Arlington), respectively, attempt to rein in the excessive use of prior authorization by health insurance companies. Among other things, the bills prohibit insurers and utilization review entities from retrospectively denying, revoking, or limiting admissions, procedures, treatments, or services when authorization has already been granted unless approval was based on inaccurate information. In addition to MHA, the Massachusetts Medical Society and Healthcare For All support the prior auth bills.

Other bills focus on supporting reimbursement parity for all telehealth services on par with in-person visits, continuing the state’s reform of the behavioral health system, and, in an often overlooked component of the healthcare system, improving medical transportation and emergency medical services.

In coming weeks and months, Monday Report will focus on specific bills in the MHA priority package as they move through the legislative process.

AG Lawsuit Halts Devastating NIH Cuts – For Now

Last Monday, the United States District Court for the District of Massachusetts issued a nationwide temporary restraining order (TRO) that prohibits the National Institutes of Health (NIH) from carrying out its February 7 order limiting reimbursements to research institutions conducting federally sponsored research.

The Association of American Medical Colleges, American Association of Colleges of Pharmacy, Association for Schools and Programs of Public Health, and the Greater New York Hospital Association, joined by the Conference of Boston Teaching Hospitals (COBTH) sued the federal government last Monday, requesting the TRO. Twenty-two Attorneys General, including Massachusetts AG Andrea Joy Campbell also brought suit against the Trump Administration’s unilateral cut of NIH’s “indirect costs” to universities, medical schools, hospitals, and others engaged in research.

A hearing to make the injunction more permanent, or rescind it, has been set for this Friday, February 21, at 10 a.m. in Boston.

The NIH reimburses institutions for specific research projects’ “direct costs” such as salaries and supplies. Costs that support the institutions’ overall grant-funded research efforts but that cannot easily be assigned to a specific project – such as maintenance of research laboratories, data processing, data security and data storage, laboratory equipment, radiation safety, hazardous waste disposal, and administrative help, among others items – are shared across an institution’s total research program and are reimbursed as “indirect costs” – or more specifically as “Facilities & Administrative” (F&A) costs.

Institutions receive differing percentages of indirect costs related to wages in the research area, the type of research and laboratories needed for that research, and other institution-specific reasons. NIH’s sudden and unexpected notice on February 7 that it would cap such indirect costs at 15% regardless of the institution or type of research sent shockwaves through the sector.

“The Rate Change Notice swept aside the entire regulatory and financial structure underlying federal grants for scientific research, which has been premised on an institution-specific, evidence-based model, for a blanket, one-size-fits-all rule that would drastically cut the rate for reimbursing these costs for virtually every institution,” the research parties wrote in their suit. “Without support through F&A costs, research laboratories would literally go dark for lack of electricity and the needed safeguards within the physical and data infrastructure supporting this research.”

Massachusetts has consistently ranked among the top states in the nation receiving NIH funds, which is a reflection of the commonwealth’s preeminence in healthcare, higher education, and the life sciences.

While the TRO has halted enforcement of the NIH’s February 7 directive, the uncertainty about funds going forward, and the fear that the federal government will attempt to “claw back” agreed-upon funding has roiled the research community.

The commonwealth’s U.S. Senators, Elizabeth Warren and Ed Markey, wrote a letter to the NIH and National Science Foundation saying that “The Trump Administration’s NIH and NSF funding freezes, and changes to basic rules governing government research assistance have had a devastating short-term impact on patients, scientists, workers, and research institutions in Massachusetts, endangering innovation and the economy. The unprecedented actions taken by the Trump Administration will undermine the United States’ research edge—whether through abandoned research projects, staffing shortages, or a ‘brain drain’ in our biotech workforce as young, budding scientists opt for other careers and countries with greater certainty.”

Medicaid Moves Onto the Menu As Congress Advances Competing Budgets

The U.S. Senate Budget Committee advanced a budget resolution last Wednesday by a party-line vote of 11-10, taking the first step in the larger reconciliation debate in support for President Trump’s legislative priorities. The Senate proposal, described as “modest” by Senate Budget Chair Lindsey Graham (R-S.C.), outlines a $342 billion package focused on border security, energy, and defense investments while holding the larger tax cut budget discussions for a later bill.

Budget resolutions do not detail spending cuts or increases, but they do set instructions on topline numbers the authorizing committees must meet in the reconciliation process; the Senate proposal directs committees with health jurisdictions to reduce spending by at least $1 billion to help offset the cost of the package.

Taking a far more expansive approach, the House Budget Committee also released its budget resolution last week. The House proposes a $4.5 trillion package that includes extending the expiring tax cuts, advancing new tax cuts, investing in border security, energy, and defense, and instituting a two-year debt limit increase. Overall, it calls for $1.5 trillion in spending cuts and $880 billion in cuts from the Energy and Commerce Committee whose jurisdiction includes Medicaid and Medicare Part B.

While neither resolution specifically mentions health programs targeted for spending cuts, House Speaker Mike Johnson (R-La.) said that he is “looking for efficiencies in every government program” and that “Medicaid is infamous for fraud, waste, and abuse.” The House Budget Committee released an “options document” in January that included $2.3 trillion over 10 years in Medicaid cuts. Over the past two weeks key Republican leaders have noted support for reforming Medicaid to a per capita cap program, restricting Medicaid provider assessments, implementing mandatory Medicaid work requirements, and revoking numerous Medicaid regulatory policies finalized in the Biden Administration, including the Medicaid state-directed payments rule that allow states to close gaps in payment between Medicaid and other payers by requiring health plans to pay providers according to state-specified rates and methods.

The American Hospital Association responded to the attack on Medicaid, saying it “urges Congress to take seriously the impact of reductions in healthcare programs, particularly Medicaid. While some have suggested dramatic reductions in the Medicaid program as part of a reconciliation vehicle, we would urge Congress to reject that approach. Medicaid provides healthcare to many of our most vulnerable populations, including pregnant women, children, the elderly, disabled and many of our working class.”

Telehealth and Hospital-at-Home Extensions Set to Expire

Adding to the uncertainty surrounding national healthcare priorities is the expiration on March 31 of telehealth and hospital-at-home flexibilities.

At the end of 2024, Congress passed the American Relief Act to fund disaster relief as well as other priorities. Part of that act extended Medicare telehealth waivers that were originally created during the pandemic and subsequently continued, and also extended the Acute Hospital Care at Home program authorization. The extensions run until March 31.

The original telehealth extensions were created during the first Trump Administration, leading some in the telemedicine sector to think they may have an ally in the new administration. In a fact sheet that the administration released last week regarding the Executive Order to establish a “Commission to Make America Healthy Again,” the administration touted its work to fulfill his promise to tackle the healthcare crisis facing America and noted that it had expanded access to telehealth, especially in rural and underserved communities.

The Massachusetts Telemedicine Coalition (tMED) that MHA convened and which represents more than 50 healthcare provider organizations, has been engaging with the state’s Congressional delegation to advance legislation codifying the extensions before the March 31 deadline.

“Without clear guidance from Congress on a long-term approach for telehealth flexibilities, healthcare systems will not be able to invest sufficient resources to allow maximal access to patients,” said MHA’s Senior Director of Virtual Care & Clinical Affairs Adam Delmolino. “We believe that policymakers now have more than enough evidence to see the benefits of telehealth and to consider a permanent pathway to ensure that telehealth continues to be available and accessible.

The hospital-at-home (H@H) model — where patients receive acute level care in their homes, rather than in a hospital — has emerged as an innovative and promising approach to provide high-quality care to patients. A growing body of research shows that H@H is an effective strategy that improves all three components of the value equation — improving outcomes, enhancing the patient experience, and reducing cost. A meta-analysis of 61 studies found that patients that have received hospital-at-home care have a 20% reduction in mortality, while another randomized control trial found that acutely ill patients admitted to H@H through the emergency department were three times less likely to be re-admitted within 30 days than patients who are treated within a hospital’s walls.

Influenza is Spiking in Massachusetts

Incidences of the flu have spiked upwards dramatically in recent week with all regions of the state reporting “Very High” cases.

Roughly 9% of all hospital emergency department visits are associated with influenza, according to data DPH collects from emergency departments. More than 11% of all visits to provider sites are the result of the flu. These are some of the highest levels seen since 2022.

During the ongoing 2024-25 flu season, there have been 139 deaths attributable to influenza, including six pediatric deaths. One hundred seven of those deaths have occurred since the start of the new year.

Transition

U.S. Senators voted 52-48 last Thursday to confirm Robert Kennedy Jr. as Secretary of U.S. Health & Human Services. Republican Sen. Mitch McConnell (R-Ky.) voted against Kennedy, as did all Democrats.

John LoDico, Editor