Health Care Watch: February 8, 2026
The following Federal Health Policy (FHP) Strategies Weekly Health Care Watch provides a summary of legislative and regulatory health care activities from February 1 – February 7. 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 February 3, the Energy & Commerce Oversight and Investigations Subcommittee held a hearing titled Common Schemes, Real Harm: Examining Fraud in Medicare and Medicaid. The hearing highlighted recent criminal cases and allegations in Minnesota as an example of broader vulnerabilities. Members discussed Medicare and Medicaid fraud as a serious and ongoing issue, debated how fraud allegations are defined and used, and raised concerns about enforcement approaches, intergovernmental coordination, oversight capacity, and the impact of fraud prevention efforts on beneficiaries and state programs.
On February 5, Democratic leaders on the Energy & Commerce Committee sent a letter to Centers for Disease Control and Prevention (CDC) Acting Director Jim O’Neill requesting information about a CDC-funded hepatitis B study in Guinea-Bissau. The letter raised concerns about the study’s ethical framework, scientific design, and the transparency and review of the grant award process, including whether appropriate oversight and coordination occurred. The lawmakers requested a response by February 20.
On February 11, the Ways & Means Committee Republicans are expected to host a closed-door roundtable with the Centers for Medicare & Medicaid Services (CMS) Center for Medicare Director Chris Klomp.
Mark Roman, GOP Staff Director of the Ways & Means Committee, will soon be leaving the committee.
Senate
On February 1, Health, Education, Labor, and Pensions (HELP) Committee Chairman Bill Cassidy (R-LA) sent a letter to Apexus, the sole contractor for the Health Resources & Services Administration’s (HRSA) 340B Prime Vendor Program, requesting information on the company’s role in administering the 340B Drug Pricing Program. The letter seeks details on Apexus’s revenues, fee structures, data controls, relationship with parent company Vizient, engagement with HRSA guidance, and activities related to 340B utilization. The request follows HELP Chairman Cassidy’s ongoing oversight of the 340B program. A response is requested by February 23.
On February 2, Finance Committee Democrats, led by Ranking Member Ron Wyden (D-OR), outlined their priorities to lower prescription drug costs following recent price increases by drug manufacturers. Proposals include expanding Medicare drug price negotiation authority, reducing out-of-pocket costs by addressing intermediary practices, and supporting domestic biomedical innovation. The lawmakers stated that the effort is intended to provide predictability for patients and reduce federal spending associated with prescription drug pricing.
On February 2, HELP Committee Ranking Member Bernie Sanders (I-VT) released a report titled Putting Cures Out of Reach: Trump’s National Institutes of Health examining National Institutes of Health (NIH) research funding and prescription drug pricing. The report found that NIH terminated or froze at least $561 million in research funding across cancer, heart disease, Alzheimer’s disease, and diabetes, including more than 300 clinical trials, and documented declines in new competitive grants for major diseases in 2025 compared to 2024. The report also found that drugs developed with NIH support are sold at lower prices in other countries than in the United States.
On February 3, the HELP Committee held a hearing titled Modernizing the National Institutes of Health: Faster Discoveries, More Cures. The hearing examined ways to modernize the NIH and strengthen American leadership in biomedical research. During the hearing, NIH Director Dr. Jay Bhattacharya discussed potential changes to the NIH grant structure, including delinking research funding from facility support to recognize institutions with lower infrastructure costs. NIH Director Dr. Bhattacharya’s testimony can be found here.
REGULATORY UPDATE
On February 1, the Food & Drug Administration (FDA) began accepting requests to participate in the FDA PreCheck pilot program to strengthen domestic pharmaceutical manufacturing and enhance regulatory predictability. The initiative is intended to streamline assessments of new manufacturing facilities through early engagement, pre-operational reviews, and phased coordination ahead of a specific drug application, with an initial cohort of facilities expected to begin participation in 2026.
On February 2, the U.S. Department of Health & Human Services (HHS) announced a series of funding and policy actions to support substance use disorder treatment, mental health services, and child welfare prevention efforts. The announcements included a $100 million investment to launch the Safety Through Recovery, Engagement, and Evidence-based Treatment and Supports (STREETS) Initiative, a $10 million Assisted Outpatient Treatment (AOT) grant program for adults with serious mental illness, and expanded eligibility for three Medications for Opioid Use Disorder (MOUD) as federally funded prevention services under HHS’ Administration for Children and Families.
On February 2, HHS’ Substance Abuse and Mental Health Services Administration (SAMHSA) distributed $794 million in the first allocation of FY 2026 block grant funding for community-based mental health and substance use prevention and treatment programs. The SAMHSA allocation includes $319 million for the Community Mental Health Services Block Grant supporting adults with serious mental illness and children with serious emotional disturbance, and $475 million for the Substance Use Prevention, Treatment, and Recovery Services Block Grant. Funding was distributed nationwide to states, territories, and select jurisdictions to support local behavioral health service delivery.
On February 2, FDA published an op-ed in the Annals of Internal Medicine recommending long-term follow-up studies for patients receiving CAR-T therapies for autoimmune diseases. The paper, co-authored by Dr. Vinay Prasad, Director of the FDA Center for Biologics Evaluation and Research, advised that extended monitoring be conducted to assess potential risks such as malignancy, fertility effects, and neurologic outcomes, consistent with existing requirements for CAR-T therapies used in oncology. The authors stated that the agency will work with manufacturers on a case-by-case basis to address study design and monitoring approaches.
On February 3, HHS General Counsel Mike Stuart initiated an effort to seek a federal investigation into the Johns Hopkins Hospital and Health System related to its provision of gender-affirming health care to minors. He submitted a referral requesting that the HHS Office of Inspector General (OIG) examine whether the health system is meeting recognized standards of care.
On February 4, the Federal Trade Commission (FTC) announced a proposed settlement with Express Scripts Inc. (ESI), resolving allegations that the pharmacy benefit manager (PBM) used anticompetitive rebating practices that contributed to inflated insulin list prices and higher patient out-of-pocket costs. Under the proposed settlement, ESI agreed to adopt changes to its formulary design, pricing practices, and transparency requirements, including offering plan sponsors options to base patient cost sharing on net drug prices and increasing disclosures related to rebates and broker payments. The proposed settlement will be open for comment for 30 days.
On February 4, FDA confirmed that it removed a consumer-facing webpage that warned about potentially dangerous products and therapies marketed as treatments for autism. According to HHS, the page, which had last been updated in 2019 and described risks associated with therapies such as chelation and hyperbaric oxygen therapy, was retired at the end of 2025 as part of routine website maintenance. FDA did not indicate whether the content will be updated or reissued.
On February 4, CMS released a fact sheet titled 2026 Medicare Accountable Care Organization (ACO) Initiatives Participation Highlights outlining participation levels across Medicare accountable care models. CMS reported that an estimated 14.3 million Medicare beneficiaries are receiving care through ACOs in 2026, up from 13.7 million in 2025, including participation through the Medicare Shared Savings Program and CMS Innovation Center models. The fact sheet also detailed approved applications and enrollment figures for the Shared Savings Program, ACO REACH, Kidney Care Choices, and ACO PC Flex models for the 2026 performance year.
On February 5, CMS released the Maximum Fair Price (MFP) explanations for the 15 Part D drugs selected for negotiation for Initial Price Applicability Year (IPAY) 2027. According to CMS, the documents outline the data that most significantly impacted the determination of offers and counteroffers.
On February 5, the Administration for Community Living (ACL) launched Phase 1 of the ACL Caregiver AI Prize Competition focused on responsible uses of artificial intelligence (AI) to support caregivers and the caregiving workforce. The national competition seeks AI tools that reduce caregiver burden, strengthen care at home and in the community, and protect against biased, unsafe, or harmful uses of the technology. Phase 1 will award up to $2.5 million across as many as 20 winners and includes two tracks addressing caregiver support tools and caregiver workforce tools. More information about Phase 1 is available through the Caregiver AI Prize Competition website.
On February 5, HHS stated in a court filing that it will vacate the existing 340B Rebate Model Pilot Program and consider whether to restart the program through a new administrative process. The filing followed decisions by the U.S. District Court of Maine and the U.S. Court of Appeals for the First Circuit that blocked implementation of the pilot program, which was scheduled to take effect on January 1. HHS indicated that if it proceeds with a new administrative process, it will issue a new notice, invite public comment, and set any effective date no earlier than 90 days after approval of drug manufacturer applications.
On February 6, HHS General Counsel Stuart announced that HHS has formally referred Hims & Hers Health to the Department of Justice (DOJ) to investigate potential violations of federal drug law. The referral follows the company’s February 5 announcement that it would begin offering a compounded oral version of semaglutide, the active ingredient in Novo Nordisk’s Wegovy, at an introductory price of $49 per month. On February 6, FDA also issued a statement announcing their intent to take “decisive steps to restrict GLP-1 active pharmaceutical ingredients (APIs) intended for use in non-FDA-approved compounded drugs that are being mass-marketed by companies - including Hims & Hers and other compounding pharmacies - as similar alternatives to FDA-approved drugs.” Subsequently, on February 7, Hims & Hers reversed course and announced that they would no longer sell the compounded semaglutide pill on their platform.
WHITE HOUSE
On February 3, President Donald Trump signed H.R. 7148, the Consolidated Appropriations Act, 2026, into law, ending a brief partial government shutdown. The legislation includes a number of Medicare extenders, including an extension of telehealth flexibilities through 2027, and number of PBM policy provisions that Congress has considered over several years, including:
Increasing transparency in drug pricing and rebate arrangements affecting patients, plan sponsors, and employers;
Modifying Part D payment structures by separating PBM compensation from drug list prices and requiring rebates to be passed through to plan sponsors; and
Establishing requirements for Part D plan sponsors to contract with any willing pharmacy, including independent pharmacies, rather than limiting participation to pharmacies affiliated with the plan sponsor or insurer.
On February 5, the White House announced the launch of TrumpRx, an online direct-to-consumer platform intended to provide patients access to discounted prescription drugs either directly from manufacturers or at participating pharmacies using downloadable coupons. There are 43 branded medicines currently available through the platform, manufactured by AstraZeneca, EMD Serono, Lilly, Novo Nordisk, and Pfizer, with additional manufacturers and products expected to be added over time. A fact sheet can be found here.
On February 5, news outlets reported that the White House Office of Management and Budget (OMB) directed federal agencies to rescind approximately $1.5 billion in previously awarded health and transportation funding from California, Colorado, Illinois, and Minnesota. According to a White House spokesperson, the directive instructed the Department of Transportation to rescind $943 million in transportation-related funds and CDC to rescind $602 million in state and local public health grants.
RULES AT THE WHITE HOUSE OFFICE OF MANAGEMENT & BUDGET (OMB)
Pending Review
CMS
HHS Notice of Benefit and Payment Parameters for 2027 (CMS-9883); Proposed Rule, 11/14/25
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
Interoperability Standards and Prior Authorization for Drugs (CMS-0062); Proposed Rule; 01/16/2026
Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH) (CMS-6098); Notice; 01/16/2026
Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2027 Rates (CMS-1849); Proposed Rule; 01/22/2026
Independent Dispute Resolution Operations (CMS-9897); Final Rule; 01/29/2026
Strengthening Oversight of Accrediting Organizations (AO), Burden Reduction, and Related Provisions (CMS-3367); Final Rule; 02/04/2026
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
Post approval Pregnancy Safety Studies; Guidance for Industry; Availability; Notice; 8/21/25
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
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
Responding to FDA Form 483 Observations at the Conclusion of a Drug CGMP Inspection: Draft Guidance for Industry; Availability; Notice; 01/27/2026
HEARINGS
House
Energy & Commerce Subcommittee on Health
Lowering Health Care Costs for All Americans: An Examination of the Prescription Drug Supply Chain
February 11, 2026, 10:15am EST; 2123 Rayburn House Office Building
Witnesses: Lori Reilly, Chief Operating Officer, Pharmaceutical Research and Manufacturers of America; John Crowley, CEO, Biotechnology Innovation Organization; John Murphy, CEO, Association for Accessible Medicines; James Gelfand, President and CEO, ERISA Industry Committee; David Marin, President and CEO, Pharmaceutical Care Management Association; Angie Boliver, President and CEO, Healthcare Supply Chain Association; Douglas Hoey, CEO, National Community Pharmacists Association; and Chip Davis, President and CEO, Healthcare Distribution Alliance.
Senate
Special Committee on Aging
The Doctor Is Out: How Washington’s Rules Drove Physicians Out of Medicine
February 11, 2026, 3:30pm EST; 216 Hart Senate Office Building
Witnesses: Alma Littles, M.D., Dean & CAO, Florida State University College of Medicine; Lee Gross, M.D., Founder, Epiphany Health Direct Primary Care; Jeffrey Smith, Incoming Board Chair, Medical Group Management Association (MGMA), and CEO, Piedmont HealthCare; Corey Feist, JCo-Founder and CEO, Lorna Breen Heroes’ Foundation.
REPORTS
Office of Inspector General (OIG)
On February 3, HHS OIG released a report titled Medicare Advantage Industry Segment-Specific Compliance Program Guidance. The guidance, which complements OIG’s General Compliance Program Guidance, provides voluntary compliance recommendations tailored to the Medicare Advantage program.
Government Accountability Office (GAO)
On February 4, GAO released a report titled Funding for Rare Neurodegenerative Disease Research and Access to ALS Investigational Drugs examining federal funding to implement the Accelerating Access to Critical Therapies for ALS Act. GAO found that NIH and FDA awarded approximately $276 million from fiscal years 2022 through 2025 to support ALS and other rare neurodegenerative disease research, including grants to expand access to investigational drugs and a public-private research partnership.
On February 3, GAO released a report titled Oversight Responsibilities and Funding from Fiscal Years 2008 through 2024 examining changes in FDA’s responsibilities, funding, and workforce capacity. GAO reported that FDA’s funding increased over the period, largely driven by user fees, while the agency’s oversight responsibilities expanded to include additional product areas such as tobacco and cosmetics. The report also noted that persistent staffing and resource management challenges have affected FDA’s ability to carry out inspections and other oversight activities.
ADDITIONAL POLICY NEWS
On February 3, the American Society of Plastic Surgeons (ASPS) issued a position statement discussing children and adolescents presenting with gender dysphoria or gender incongruence. ASPS recommends surgeons delay gender-related breast, genital, and facial surgery on youths until they turn 19. HHS leadership subsequently issued statements commending ASPS for their position. The American Medical Association also issued a statement to multiple news outlets stating surgical interventions in minors should be generally deferred to adulthood.
On February 4, the consumer advocacy group Public Citizen sent a letter to the FTC alleging that HHS Surgeon General Nominee Casey Means failed to disclose paid partnerships in connection with health and wellness products promoted through her online platforms. The letter asserts that the alleged nondisclosures occurred repeatedly between January 2024 and August 2025 and may implicate the FTC’s influencer marketing policies, while also mentioning that Means’ financial and ethics filings reportedly disclosed sponsorship and affiliate income to the U.S. Office of Government Ethics.