Sellers Dorsey Digest

Federal Updates

News

RFK Jr. Sworn in as HHS Secretary, is to Lead MAHA Commission

• On February 13, following a 52-48 Senate vote, Robert F. Kennedy Jr. was sworn in as the Health Secretary of the US Department of Health and Human Services (HHS). Key stakeholders look to RFK to reform PBM practices, affordability of drugs for seniors, and protection of vaccine approval and safety frameworks. In the hours following RFK taking office, President Donald Trump signed an executive order establishing the Make America Healthy Again (MAHA) commission, which will be led by RFK and will investigate the root causes of what it terms “America’s health crisis” with initial focus on childhood chronic disease. Additionally, the commission will look into addressing the current food system and physical and technological effects on health. MAHA’s key policy directives for chronic disease reversal are transparency, research integrity, and preventative healthcare (Fierce Healthcare, February 13; Inside Health Policy, February 13; Fierce Healthcare, February 13).

Employees in Federal Health Agencies Experience Widespread Layoffs

• Over the last week, federal agencies, including several health agencies, terminated the employment of thousands of employees, including some who were on probationary status due to a recent hire or role switch. According to various sources, the Department of Health and Human Services lost up to 5,200 employees across all divisions, including 10% of the Centers for Disease Control and Prevention workforce. Thousands of employees under the National Institutes of Health and the Department of Veterans Affairs also had their employment terminated over the weekend. Probationary employees who are early in the process have fewer protections available to them if their employment is terminated. The terminations follow a February 11 executive order requiring federal agencies to reduce their workforce and meet the administration’s goals of streamlining the federal government and cutting costs. According to the Trump Administration, public health experts, Indian Health Service (IHS) providers, and Centers for Medicare and Medicaid Services (CMS) employees were not included in the cuts, which they anticipate will save $600M annually. However, there are reports of workers from divisions within CMS, including the Center for Medicare and Medicaid Innovation (CMMI) and the Center for Consumer Information and Insurance Oversight (CCIIO), who may have their employment terminated. Additionally, many federal workers from the Administration for Children and Families, Food and Drug Administration, and the Substance Abuse and Mental Health Services Administration have stated on social media that their employment was terminated. The American Federation of Government Employees (AFGE) announced that it would pursue legal action against the Administration over the abrupt terminations (Fierce Healthcare, February 17; Modern Healthcare, February 14; Inside Health Policy, February 14).

CDC Points Towards Asymptomatic Spread of HPAI

• On February 13, the CDC’s “Morbidity and Mortality Weekly Report” indicated that veterinarians had identified three patients in the US with recent infection of HPAI (highly pathogenic avian influenza), two of whom had no contact with animals with the virus. The CDC believes that people infected with the virus may be asymptomatic and are reiterating the importance of utilizing the Department of Agriculture’s milk testing program. As the Trump Administration continues to make staffing cuts within federal agencies, stakeholders are concerned about possible disruptions to an efficient HPAI response. The CDC has reportedly canceled congressional meetings with state officials about the outbreak. There is additional concern surrounding information about “raw milk,” as federal officials have urged the public to not consume unpasteurized milk, but the HHS secretary, Robert F. Kennedy Jr., has made statements regarding the health benefits of consuming “raw milk” (Inside Health Policy, February 14).

Federal Legislation

House GOP Advances Budget Plan Amid Fierce Medicaid Cut Concerns

• The House Budget Committee advanced a budget proposal that establishes an $880B deficit reduction goal for the House Energy & Commerce Committee, the committee which oversees Medicaid, Medicare, and other programs. Republicans on the Committee noted plans to make reductions by addressing abuse, fraud, and waste; Committee Democrats argued cuts would negatively impact the healthcare of Medicaid beneficiaries. During a 12-hour debate, Democrats introduced more than 30 amendments produced for their stated goal of defending Medicaid, Medicare, and the Affordable Care Act, all of which were rejected by the Majority. However, Committee Republicans approved two amendments: one that would restrict the application of tax reductions unless Republicans also cut $2T in expenditures and another adding the Regulations from the Executive in Need of Scrutiny (REINS) Act to the final reconciliation package. The revised budget framework now goes to the full House for a vote before each committee’s savings or spending instructions are finalized. Sellers Dorsey is continuing to advise clients to engage directly with their policymakers about the impact that significant cuts to Medicaid would have on their ability to provide care. (Inside Health Policy, February 14).

State Updates

News

New Jersey Expands PACE Program to Support More Older Adults

• New Jersey is expanding its Program of All-Inclusive Care for the Elderly (PACE) to four more counties – Hunterdon, Morris, Sussex, and Warren – moving closer to making the program available statewide. PACE helps older adults, especially those on Medicare and Medicaid, receive care at home or in community centers instead of nursing homes. The state’s Human Services Department has issued a call to providers to apply to run the program in these areas. Currently, seven organizations operate PACE in 17 New Jersey counties. As the demand for senior care grows, PACE has been expanding across the country, offering services like home care, prescriptions, transportation, and social activities to about 80,000 people in 33 states and Washington, D.C. (Modern Healthcare, February 14).

California Health Plans Create Value-Based Primary Care Initiative

• A collaboration between Blue Shield of California, Aetna, and Health Net aims to enhance primary care in California and reduce physician burnout. The initiative includes a value-based payment structure in which physicians can be paid through several different “tracks” ranging from fee-for-service to per-member per-month payments for certain services. Providers can also receive incentives to support population health through referrals, outreach, assisting transitions of care, data reporting, and more. Physician practices will use a unified data platform to streamline patient information and reduce administrative burden. The initiative plans to track how providers spend the additional funds to determine which investments result in better health outcomes. The Purchaser Business Group on Health’s California Quality Collaborative (CQC) and the Integrated Healthcare Association (IHA) are facilitating the demonstration, which is being monitored by several companies and organizations, including CMS (Fierce Healthcare, February 11).

Colorado to Cut GLP-1 Drug Coverage for its State Employees

• Colorado has joined an increasing number of states that have moved to limit coverage of weight-loss drugs for state employees. On July 1, 2025, Colorado will begin to limit coverage of GLP-1 medications solely for the treatment of Type 2 diabetes, cardiovascular disease, and obstructive sleep apnea. Those who wish to use GLPs for other conditions will have to pay out-of-pocket at approximately $1K/month. Colorado has reportedly seen usage of the drug double every six months from 2023 to 2024, which is driving lawmakers’ view that paying for the drug is unsustainable in the long-term (Colorado Sun, January 23; Health Payer Specialist, February 14).

SPA and Waiver Approvals

SPA AND WAIVER APPROVALS

• From February 13 to February 19, there were no waivers submitted or approved, and no SPAs approved.

Private Sector Updates

News

UnitedHealth Group, Amedisys Plan to Divest Home Health and Hospice Locations to Close Merger

• Looking to close their $3.3B merger, UnitedHealth Group and Amedisys plan to divest numerous home health and hospice locations. UnitedHealth plans to sell at least 128 combined facilities to comply with merger conditions, reducing its market share to 10% of home health services and 4% of hospice services. In November 2024, the Department of Justice sued to block the companies from merging, citing concerns about reduced competition. Last month, UnitedHealth asked the court to dismiss the case but has since withdrawn the motion. The company states that the merger with Amedisys will enhance care continuity and advance value-based care models (Fierce Healthcare, February 12).

Humana Looks to Renew Focus in 2025

• Following a challenging 2024, Humana is taking what CFO Celeste Mellet characterized as a “ruthless” approach to the new year to drive better outcomes for their members and better returns for shareholders. While Humana lost $2.16 per share during the last quarter and $29.2B in revenue, in 2024 they brought in a total of $117.76B, resulting in a 10% year over year increase. In 2025, leadership looks to focus on operational efficiency, increase its individual Medicare Advantage (MA) margin by 3 percent, shift their membership mix to focus on sustainable long-term value, continue in its Prescription Drug Plan (PDP) strategy for which they are expected to see growth of about 200,000 members, continue their litigation against CMS regarding star ratings, and continue its 5-year plan into 2030 for Medicaid D-SNP beneficiaries where they are expected to see approximately 250,000 new members this year (Health Payer Specialist, February 11; Fierce Healthcare, February 11).

CVS Beats Q4 Profit Expectations

• CVS Health Corp.’s stock price surged after it announced higher than expected fourth quarter earnings. Lower than predicted medical expenses at its Aetna insurance business contributed to higher earnings, with adjusted earnings of $1.19 a share, beating analysts’ prediction of 92 cents. CVS recorded robust revenue in all segments despite continued struggles in its drugstore and insurance units, with quarterly revenue amounting to $97.7B. The company also provided 2025 earnings forecast of $5.75 to $6 a share, a bit below analysts’ expectations but otherwise a good benchmark (Modern Healthcare, February 12).

Sellers Dorsey Updates

NEWS

Director of Data Analytics and Visualization Inducted into Tableau Visionary Hall of Fame

• Sellers Dorsey is pleased to congratulate Lindsay Betzendahl, Director of Data Analytics and Visualization, for being inducted into the Tableau Visionary Hall of Fame. Tableau Visionary is a title that honors the Tableau Community’s most distinguished leaders – those who push Tableau to be better for everyone and help innovate with Tableau products through mastery, teaching, and collaboration with others.

Learn more about Lindsay’s exciting accomplishment

LAST CHANCE TO REGISTER
A Decade of Reform: Transforming Child Welfare in California

• Don’t miss your last chance to register for our upcoming webinar on February 26 at 1 PM (EST). California has transformed its child welfare system over the past decade by focusing on innovative strategies to improve access, quality, and outcomes for the state’s children and families. Join top experts in health and human services and child welfare as they discuss opportunities for innovation while diving deep into the role of technology, data sharing, and community-based approaches.

Register today