RISE summarizes recent regulatory-related headlines.
States file lawsuit over cuts to federal health funds
A coalition of 23 states and the District of Columbia have filed a lawsuit against the Trump administration for abruptly and unlawfully cutting billions of dollars in state health funding. Last month, the U.S. Department of Health and Human Services announced it would claw back more than $11 billion in funding previously allocated to states for public health, mental health, and addiction initiatives.
The attorneys general argue that these sudden and reckless cuts violate federal law, jeopardize public health, and will have devastating consequences for communities nationwide. They are asking the court to immediately stop the administration from rescinding the funding and prevent the breakdown of crucial health services.
The terminated funds, which were allocated by Congress at the height of the COVID-19 pandemic, include $11.4 billion in funding from the Centers for Disease Control and Prevention (CDC) for pandemic preparedness, overdose prevention, and community health programs, as well as $1 billion from the Substance Abuse and Mental Health Services Administration (SAMHSA) for addiction treatment, suicide prevention, and crisis intervention programs.
“The Trump administration’s illegal and irresponsible decision to claw back life-saving health funding is an attack on the well-being of millions of Americans,” said New York Attorney General Letitia James in an announcement. “Slashing this funding now will reverse our progress on the opioid crisis, throw our mental health systems into chaos, and leave hospitals struggling to care for patients. My office is taking immediate action to stop this heartless and shortsighted move and ensure these life-saving programs remain intact.”
Superior Insurance under investigation for using private investigators to spy on customers
Texas Attorney General Ken Paxton has announced an investigation into Superior HealthPlan for allegedly using private investigators to perform surveillance and gather potentially confidential information on lawmakers, journalists, and private citizens with pending insurance claims against the insurance company.
At a public hearing last week before the Texas House of Representatives Committee on Delivery of Government Efficiency (“DOGE”), Superior Insurance CEO Mark Sanders admitted the company hired and directed private investigators to spy on members of the Texas legislature as well as private citizens seeking payment of medical bills. Lawmakers expressed concern that these actions were taken to secure leverage to help the company win future state contracts and to discredit their own customers seeking payment on legitimate insurance claims.
“The allegations concerning Superior’s actions, such as actions that were characterized as potentially blackmailing lawmakers to secure state contracts and surveilling private citizens to avoid paying legitimate claims, are deeply troubling,” said Attorney General Paxton. “I will get to the bottom of this, uncover any illegal activity, and hold bad actors responsible. Justice will be served.”
Sanders was dismissed from his duties as chief executive of Superior HealthPlan after his testimony, the Independent reported.
Report: MA practices threaten health care access in rural communities
The American Hospital Association (AHA) recently released its Health Care Plan Accountability Update, which highlights how certain practices by Medicare Advantage plans are increasing rural hospitals' vulnerabilities and threatening access to care in rural communities.
The report finds:
- Reimbursement well below the cost of care: Traditional Medicare often pays less than the cost of care, and increasingly rural hospitals report that Medicare Advantage plans pay even less—only 90.6 percent of Traditional Medicare rates on a cost basis.
- Diminished access to quality care: Delays, denials, and excessive prior authorization from certain Medicare Advantage plans can hinder timely care: 81 percent of rural clinicians report quality reductions due to insurer requirements, and Medicare Advantage patients face 9.6 percent longer stays before post-acute care compared to similar traditional Medicare patients
- Administrative burdens and payment challenges: Delayed or denied Medicare Advantage payments worsen rural hospitals’ finances and increase administrative burdens. Nearly four in five rural clinicians report higher administrative tasks in five years, with 86 percent seeing negative impacts to patient outcomes.
Bipartisan bill would allow doctors to decide on prior authorizations
Congressman Mark Green, M.D., (R-Tenn.) has re-introduced his bill, Reducing Medically Unnecessary Delays in Care Act of 2025, alongside Doctor Caucus Co-chair Rep. Greg Murphy, M.D. (R-N.C), and the Congressional Democratic Doctors Caucus Co-chair Kim Schrier, M.D. (D-Wash.), to address the use of prior authorization requirements in Medicare, Medicare Advantage, and Part D prescription drug plans.
The bill calls for prior authorization reform in Medicare and Medicare Advantage by requiring that board-certified physicians in the same specialty are the ones who make decisions about patient care and treatment. It would also direct Medicare, Medicare Advantage, and Medicare Part D plans to comply with requirements that restrictions must be based on medical necessity and written clinical criteria, as well as additional transparency obligations.
According to the American Medical Association, 23 percent of physicians report that prior authorization has led to a patient’s hospitalization, while 18 percent report that it has led to a life-threatening event. In the same 2024 survey, 94 percent of physicians believed that prior authorization requirements negatively impacted patient care.
“As a survivor of both colon and thyroid cancer, I know how critical it is to start treatment as soon as possible,” Green said in an announcement. “Prior authorization can be a roadblock that costs lives. Doctors need to be able to make fast, life-saving decisions without a jungle of red tape to cut through…Americans don’t want bureaucrats sitting in on their doctor’s appointments, and they don’t want them to determine their treatment plans.”
DOJ launches Anticompetitive Regulations Task Force
The Department of Justice has established an Anticompetitive Regulations Task Force to advocate for the elimination of anticompetitive state and federal laws and regulations that undermine free market competition and harm consumers, workers, and businesses. The Task Force will surge resources to these efforts and invite public comments to support the Administration’s mission to unwind laws and regulations that hinder business dynamism and make markets less competitive.
As a first step, the Antitrust Division will initiate a public inquiry to identify unnecessary laws and regulations that raise the highest barriers to competition. It will seek information from the public about laws and regulations that make it more difficult for businesses to compete effectively, especially in markets that have the greatest impact on American households, including health care.
Laws and regulations in health care markets too often discourage doctors and hospitals from providing low-cost, high-quality health care and instead encourage overbilling and consolidation, DOJ said in the announcement. These kinds of unnecessary anticompetitive regulations put affordable health care out of reach for millions of American families.
The public will have until May 26 to submit comments at www.Regulations.gov (Docket No. ATR-2025-0001). Once submitted, comments will be posted to Regulations.gov. All market participants are invited to provide comments in response to this inquiry, including consumers, consumer advocates, small businesses, employers, trade groups, industry analysts, and other entities that are impacted by anticompetitive state or federal laws and regulations.
ACA marketplace enrollment has more than doubled since 2020
Enrollment in Affordable Care Act (ACA) Marketplace health plans reached a record 24.3 million people, more than double the total in 2020, with most of the growth occurring in states won by President Trump in the 2024 election, according to a new KFF analysis.
Almost all states have seen increases in enrollment since 2020, including six states where enrollment has more than tripled: Texas (up 255 percent), Mississippi (up 242 percent), West Virginia (up 234 percent), Louisiana (up 234 percent), Georgia (up 227 percent), and Tennessee (up 221 percent). Only New York (down 19 percent), Oregon (down four percent) and the District of Columbia (down three percent) experienced enrollment declines over the past five years.
The growth in enrollment since 2020 has been concentrated in states that President Trump carried in the 2024 election, KFF noted. Those 31 states accounted for 88 percent of the increase in enrollment during the past five years. Put another way, since 2020, enrollment grew by an average of 157 percent in states carried by President Trump but only 36 percent in states carried by former Vice President Harris.
The growth in enrollment since 2020 has been concentrated in states that President Trump carried in the 2024 election, KFF noted. Those 31 states accounted for 88 percent of the increase in enrollment during the past five years. Put another way, since 2020, enrollment grew by an average of 157 percent in states carried by President Trump but only 36 percent in states carried by former Vice President Harris.