Health Care Watch: January 19, 2026
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from January 12 – January 17. Where available, hyperlinks are included to the relevant documents. Please let us know if you have any questions or would like additional information on the items below.
LEGISLATIVE UPDATE
House
On January 13, Rep. Neal Dunn (R-FL) announced he will retire from Congress at the end of this term. Rep. Dunn, a urologist, serves on the Energy & Commerce Committee and is a member of the Doctors Caucus.
On January 14, the House passed legislation to fund the Departments of State and Treasury through October 1 by a 341–79. The bill would fund the Internal Revenue Service, the federal judiciary, and the Federal Trade Commission, and includes $9.4 billion in global health funding.
On January 14, Rep. Paul Tonko (D-NY), co-chair of the Congressional Addiction, Treatment, and Recovery Caucus, led a bipartisan House letter to Department of Health & Human Services (HHS) Secretary Robert F. Kennedy, Jr, seeking clarification on the cancellation of nearly $2 billion in grants administered by the Substance Abuse & Mental Health Services Administration (SAMHSA). HHS reinstated the funding later that same day.
Senate
On January 14, the Health, Education, Labor, and Pensions (HELP) Committee held a hearing titled Protecting Women: Exposing the Dangers of Chemical Abortion Drugs. The hearing examined the safety, regulation, and use of medication abortion drugs. Members discussed reported adverse events, existing Food & Drug Administration (FDA) oversight, and broader implications for patient safety and public health policy.
On January 15, the HELP Committee unanimously advanced legislation to expand access to and awareness of lung cancer and prevention, examine hospital testing of fentanyl overdoses, require HHS to develop a cybersecurity plan for rural hospitals, and update manufacturer reporting requirements for contaminated infant formula.
As of January 16, a bipartisan group of Senators had agreed on a policy to extend the enhanced Affordable Care Act (ACA) premium tax credits. Senators involved these negotiations have not resolved key disagreements, including abortion-related funding provisions.
The Senate is in recess until January 26.
REGULATORY UPDATE
On January 9, a federal judge granted the Federal Trade Commission’s (FTC’s) request to block Edwards Lifesciences’ proposed acquisition of JenaValve Technology. The FTC argued the transaction would reduce competition in the market for transcatheter aortic valve replacement systems intended to treat aortic regurgitation, noting the companies are the only two conducting U.S. clinical trials for the technology.
On January 11, the FDA announced it is formalizing and communicating greater regulatory flexibility in its oversight of chemistry, manufacturing, and control (CMC) requirements for cell and gene therapies. The FDA stated the approach reflects existing flexibilities under current regulations and is intended to guide review of development strategies leading up to Biologics License Application (BLA) submissions while maintaining standards for product safety, purity, and potency.
On January 12, the FDA published draft guidance outlining recommendations for the use of Bayesian statistical methodologies in clinical trials for drugs and biologics. The guidance describes how Bayesian approaches may be used to support trial design, interim analyses, subgroup analyses, and primary inference, including incorporation of prior information such as historical clinical data or real-world evidence. The FDA stated the guidance fulfills a commitment under the Prescription Drug User Fee Act (PDUFA) VII and is seeking public comment.
On January 12, the Centers for Medicare & Medicaid Services (CMS) released a fact sheet reporting that 22.8 million consumers had selected health insurance coverage for the 2026 plan year through the ACA Marketplaces since open enrollment began on November 1, 2025. CMS reported 15.6 million plan selections through HealthCare.govand 7.2 million through state-based exchanges, including 2.8 million new enrollees and 20 million consumers who were actively or automatically re-enrolled.
On January 12, CMS announced that the White House Office of Management and Budget (OMB) approved the Information Collection Request for the Medicare Drug Price Negotiation Program for Initial Price Applicability Year 2028. CMS stated it will select up to 15 high-expenditure, single-source drugs by February 1, with manufacturers required to submit negotiation data by March 1. CMS also indicated members of the public may optionally submit evidence regarding selected drugs and therapeutic alternatives during the same period.
On January 12, HHS notified the U.S. Court of Appeals for the First Circuit that it will withdraw its appeal of a preliminary injunction issued by the U.S. District Court for the District of Maine on December 29, which halted implementation of the 340B Drug Pricing Program rebate pilot program. In its filing, HHS stated it will return the challenged approvals to the agency for reconsideration, leaving in place existing requirements that manufacturers provide covered entities with up-front 340B discounts. The pilot program will remain on hold during the agency’s reconsideration.
On January 13, SAMHSA announced a $231 million funding opportunity to support administration of the 988 Suicide & Crisis Lifeline. The funding will support the national 988 network administrator overseeing more than 200 local crisis contact centers providing call, text, chat, and American Sign Language videophone services.
On January 13, the HHS notified thousands of organizations that discretionary grants supporting substance use disorder treatment and mental health services administered through SAMHSA were being terminated due to a realignment of agency priorities. On January 14, HHS reversed course and reinstated the grants following significant pushback.
On January 13, HHS and the Centers for Disease Control and Prevention (CDC) announced the appointment of Adam Urato, M.D. and Kimberly Biss, M.D., two obstetrician-gynecologists, to Advisory Committee on Immunization Policy (ACIP) following the committee’s reconstitution in June 2025.
On January 14, the FDA released a shared set of principles to inform future policy on the use of artificial intelligence (AI) in drug development. The document outlines 10 guiding principles addressing areas such as defining context of use, applying risk-based validation and oversight, documenting data provenance and model development, managing system performance over time, and ensuring transparency and explainability across the drug product life cycle.
On January 15, CMS released its Fiscal Year 2025 Improper Payments Fact Sheet reporting improper payment estimates across Medicare, Medicaid, the Children’s Health Insurance Program, and Affordable Care Act programs. CMS reported a decline in Medicare Fee-for-Service improper payments to 6.55% ($28.83 billion), while improper payment rates increased for Medicare Advantage, Medicare Part D, Medicaid, and CHIP, largely due to insufficient documentation rather than fraud or abuse. CMS noted that increases in Medicaid and CHIP reflect the resumption of eligibility redeterminations and provider revalidation following the COVID-19 public health emergency.
WHITE HOUSE
On January 12, AbbVie announced a voluntary most favored nation (MFN) agreement with the Trump administration, largely mirroring similar agreements made by large manufacturers. Under the agreement, AbbVie stated it will provide lower prices in Medicaid; make several of its medications including its drug for chronic inflammatory and autoimmune conditions HUMIRA, eye drop medications ALPHAGAN and COMBIGAN, and hypothyroidism drug SYNTHROID directly available to consumers at lower prices through TrumpRx; and commit $100 billion in U.S.-based research, development, and capital investments over the next decade. AbbVie also indicated the agreement provides exemptions from tariffs and future pricing mandates, with additional terms remaining confidential.
On January 15, President Trump called on Congress to enact his comprehensive healthplan called The Great Healthcare Plan. The proposal requests that Congress codify the administration’s MFN policy but “grandfather” the voluntarily negotiated MFN agreements between manufacturers and the administration, expand the availability of verified safe pharmaceutical drugs for over-the-counter purchase, prohibit PBM kickbacks, redirect ACA subsidies directly to patients, and mandate stricter transparency standards for insurers and providers regarding pricing, revenue, and claim denials.
RULES AT THE WHITE HOUSE OFFICE OF MANAGEMENT & BUDGET (OMB)
Pending Review
CMS
Amendments to Rules Governing Organ Procurement Organizations (CMS-3409); Proposed Rule; 8/21/25
Ensuring Safety through Domestic Security with Made in America PPE and Essential Medicine Procurement by Medicare Providers and Suppliers (CMS-1516); Pre-rule; 9/12/25
HHS Notice of Benefit and Payment Parameters for 2027 (CMS-9883); Proposed Rule, 11/14/25
Preserving Medicaid Funding for Vulnerable Populations – Closing a Health Care-Related Tax Loophole (CMS-2448); Final Rule, 11/17/25
Advance Notice of Methodological Changes for Calendar Year (CY) 2027 for Medicare Advantage (MA) Capitation Rates and Part C and Part D Payment Policies; Notice; 12/04/25
Amending the Indirect Hold Harmless Threshold of Health Care-Related Taxes (CMS-2452); Proposed Rule, 12/31/2025
Administrative Simplification: Adoption of Standards for Health Care Attachment Transactions and Electronic Signatures (CMS-0053); Final Rule, 01/09/26
FDA
Evaluating the Safety of Antimicrobial New Animal Drugs with Regard to their Microbiological Effects on Bacteria of Human Health Concern; Guidance for Industry; Notice; 7/10/25
Postapproval Pregnancy Safety Studies; Guidance for Industry; Availability; Notice; 8/21/25
New and Revised Draft Q&As on Biosimilar Development and the Biologics Price Competition and Innovation Act; Draft Guidance for Industry; Availability; Notice; 11/26/25
New Clinical Investigation Exclusivity (3-Year Exclusivity) for Drug Products: Questions and Answers; Draft Guidance for Industry; Availability; Notice; 12/01/25
Substances Generally Recognized as Safe; Proposed Rule; 12/01/25
Minimal Residual Disease and Complete Response in Multiple Myeloma: Use as Endpoints to Support Accelerated Approval; Notice; 12/05/25
Medical Devices with Indications Associated with Weight Loss--Premarket Considerations; Guidance for Industry and Food and Drug Administration Staff; Availability; Notice; 12/18/25
General Considerations for the Use of New Approach Methodologies; Draft Guidance for Industry; Availability; Notice; 01/09/25
HEARINGS
House
Energy & Commerce Health Subcommittee
Lowering Health Care Costs for All Americans: An Examination of Health Insurance Affordability
January 22, 9:45 AM EST; 2123 Rayburn House Office Building
Witnesses: Stephen Hemsley, CEO, UnitedHealth Group; David Joyner, President and CEO, CVS Health Group; David Cordani, President, CEO, and Chairman of the Board, Cigna Health Group; Gail Boudreaux, President and CEO, Elevance Health; and Paul Markovich, President and CEO, Ascendiun
Ways & Means Committee
Full Committee Hearing with Health Insurance CEOs
January 22 , 2:30 PM EST; 1100 Longworth House Office Building
Witnesses: Stephen Hemsley, CEO, UnitedHealth Group; David Joyner, President and CEO, CVS Health Group; David Cordani, President, CEO, and Chairman of the Board, Cigna Health Group; Gail Boudreaux, President and CEO, Elevance Health; and Paul Markovich, President and CEO, Ascendiun
ADDITIONAL POLICY NEWS
On January 12, approximately 15,000 nurses represented by the New York State Nurses Association (NYSNA) began a strike at Montefiore Medical Center, New York-Presbyterian, and the Mount Sinai Health System. The nurses are seeking wage increases tied to inflation, enforcement of staffing protections negotiated in prior contracts, and new contract provisions related to artificial intelligence and workplace violence. New York state officials said the Department of Health will monitor hospital operations during the strike to ensure patient safety and continuity of care.
On January 12, JAMA Internal Medicine published a study finding that U.S. skilled nursing facility (SNF) operating capacity declined by approximately 5% between 2019 and 2024. The study found that staffing shortages and operational constraints amplified the impact of facility closures and bed reductions, with rural counties experiencing steep declines of 15% or more. Areas with larger declines reported longer hospital lengths of stay and increased travel to admitting SNFs.
On January 13, Epic Systems, along with several of its health system customers, filed a lawsuit in federal district court against Health Gorilla, a clinical data platform and qualified health information network (QHIN) under the federal Trusted Exchange Framework and Common Agreement (TEFCA), and its customers. The lawsuit alleges Health Gorilla engaged in improper access and monetization of patient medical records.
On January 13, the National Family Planning and Reproductive Health Association (NFPRHA), along with the American Civil Liberties Union (ACLU), voluntarily dismissedits federal lawsuit challenging the withholding of Title X family planning funds following HHS’ restoration of tens of millions of dollars in previously withheld grants to Planned Parenthood affiliates and other family planning service sites. The funds had been temporarily withheld beginning in 2025 while the department reviewed compliance with federal requirements. Although the Title X funds were restored retroactively, there is ongoing litigation over the provision to bar Medicaid funds for Planned Parenthood and other reproductive-health providers in the One Big Beautiful Bill.
On January 13, California, Colorado, Delaware, Illinois, Michigan, Minnesota, Nevada, New York, Oregon, Rhode Island, Vermont, and Washington filed a lawsuit challenging a Trump administration policy that conditions federal health and education funding on compliance with an executive order restricting the use of funds related to what the administration calls “gender ideology.” The states argue the HHS grant requirement is unlawful and exceeds the agency’s authority by effectively altering Title IX standards and congressional spending decisions.
On January 14, data from the Kidney Transplant Collaborative showed that the number of deceased kidney donors declined for the first time in more than a decade, falling from 15,937 in 2024 to 15,274 in 2025. The decline contributed to a year-over-year decrease in total kidney transplants despite an increase in living donor transplants and a lower kidney discard rate.
On January 15, Kaiser Permanente agreed to pay $556 million to resolve allegations brought by the Department of Justice related to Medicare Advantage risk adjustment practices. According to the settlement announcement, the government alleged that Kaiser Permanente submitted diagnosis codes for conditions that were not supported by medical records, resulting in higher payments from CMS. Kaiser Permanente did not admit liability as part of the settlement, which resolves multiple whistleblower lawsuits.