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Blog

Navigating the Government Shutdown: Safeguarding the RHT and 鈥淢ake Rural America Healthy Again鈥� Initiatives

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As of October 1, 2025, federal budget negotiations have led to a temporary government shutdown, prompting healthcare leaders to monitor potential impacts on programs administered by the Centers for Medicare & Medicaid Services (CMS). While federal agencies have contingency plans in place, to date CMS has not announced any potential impacts, including to the timelines for the application and award dates for the Rural Health Transformation (RHT) Program.

State governments and healthcare leaders should continue to develop and prepare to submit their applications for the RHT program, which provides a significant opportunity to revitalize rural healthcare infrastructure through strategic investments in access, workforce, innovation, and technology.

Strategies for States to Efficiently Develop Winning Applications

To maintain momentum and optimize their resources during this period of uncertainty in federal government funding and operations:

1. Strengthen Internal Coordination

  • Establish cross-agency working groups to manage RHT program planning and execution
  • Use internal policy 量子资源s to interpret the Notice of Funding Opportunity (NOFO) guidance and align initiatives with CMS priorities

2. Leverage Existing Data and Evidence

  • Use state-level health data to identify high-impact areas for investment
  • Prioritize initiatives that align with the RHT program鈥檚 five strategic goals:
    • Prevention and chronic disease management
    • Sustainable access
    • Workforce development
    • Innovative care models
    • Technology innovation

3. Utilize Project Management Tools

To support strategic planning and initiative tracking, 量子资源 (HMA) is offering a free RHT Project Management Tool. This resource helps states:

  • Organize and manage initiative development
  • Cross-reference projects with NOFO categories
  • Track progress and performance metrics
  • Facilitate collaboration across stakeholders

Access the RHT Project Management Tool from HMA:

Complete the form to download
the RHT Project Management Tool

Engage with CMS Resources Proactively

States and their partners can continue to refer to key CMS resources:

States can also submit questions to [email protected].

Final Thoughts

While the government shutdown presents challenges for many federal programs, it remains unclear whether there will be any direct impact on CMS鈥檚 engagement with states regarding the Rural Health Transformation Program. Regardless of federal circumstances, this moment highlights the value of state-level leadership and innovation. By leveraging tools like HMA鈥檚 project management platform and aligning with CMS鈥檚 strategic goals, states can continue advancing rural health transformation and position themselves for success, even in uncertain times.

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Big changes ahead for ACA marketplace plan enrollment and premiums

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With changes to ACA subsidies included in H.R. 1, the healthcare industry could face the biggest change since the passage of the ACA.

Health insurance coverage is likely to be disrupted by changes in ACA marketplace financing, particularly due to the projected reductions in ACA subsidies, as well as the impacts of eligibility and enrollment changes in Medicaid. At a recent HMA webinar, our ACA marketplace 量子资源s detailed a number of challenges that health plans participating in the ACA will face in the coming months and years due to these new policies, and some of the thinking behind ways that plans can take action now while Congress debates whether to extend any of the subsidies. 

The webinar touched on areas including:

  • How the recent policy and funding changes will affect strategic planning, longer term goals, and 2027 plan year rate setting;
  • Actuarial analysis/rate setting/risk adjustment insights from HMA鈥檚 actuaries;
  • Changes likely to occur in plan and marketplace operations in both state exchanges and on the healthcare.gov federal platform;
  • The importance of effective communications to avoid creating consumer confusion, and ideas on stakeholder engagement strategies;
  • And, how all of this will impact workforce/access to care, and the likelihood of changes to in-network care

The ACA marketplace is bracing for impacts for the 2026 plan year, depending upon potential Congressional actions in the remaining months of 2025.  In May 2025, CMS put out a rate filing bulletin for plan year 2026 that gave technical directions for submissions and urging states and issuers to be prepared to react to Congressional action. This was a signal that the administration anticipated potential policy changes between May when they put this out and the rate filing window in the fall.

This is reminiscent of the ACA changes that happened in 2017, when there was litigation around cost-sharing reduction (CSR) subsidies that needed to be appropriated. (This was during the 鈥渞epeal and replace鈥� debate in Congress, in that same July-August timeframe.) When repeal efforts failed in Congress, the Administration decided not to pay CSRs, necessitating a bipartisan agreement to address this new financing issue.  Changes to CSRs were dropped from this year鈥檚 law but could be addressed before the end of the year in upcoming appropriations bills in Congress.

鈥淎CA plan strategies need to change to ensure that they are considering different outcomes in the market composition and competitor changes to pricing strategies. Expect more policy changes and potential for market churn, making pricing difficult in 2027 given the limited information on what happens in 2026.鈥� – Michelle Anderson

A recent Wakely report analyzing the early draft of HR 1 before passage () details estimated reductions in the individual market enrollment with potential reduction anywhere from 47 to 57% or 11.2 to 13.6 million enrollment enrollees by 2028. The attrition estimates include the loss of both federally subsidized individuals, as well as the unsubsidized due to premium increases. This paper was quoted in a recent NY Times piece,

鈥淐hanges are coming for Healthcare.gov and state marketplace consumers in 2026. The (likely) expiring enhanced premium tax credits, as well as provisions within HR 1 and the Marketplace Integrity and Affordability rule will all be rolled out to marketplace consumers this coming Open Enrollment. In addition to the marketplaces, state departments of insurance, issuers, enrollment assistance professionals, and other stakeholders will play a critical role in helping consumers navigate the coming eligibility and affordability changes.鈥� – Zach Sherman

Impacted marketplace consumers need to be made aware of these coming changes. States and issuers should undertake a broad, aggressive, and coordinated communication effort around the overall rate changes. Ensuring consumers understand how their net premium is changing due to expiring enhanced premium tax credits as well as the other operational changes will be crucial to their ability to stay covered. We expect to see considerable consumer plan switching this coming open enrollment as a result. Some consumers may need to buy-down to silver or bronze plans to be able to afford to maintain their coverage. Marketplaces will need to ramp up customer service and navigation support. States with reinsurance programs or premium subsidies should consider ramping up funding to mitigate the affordability gaps that are likely to occur.

鈥淚t’s really important for folks in the ACA marketplace community to be active when it comes to policymaking and advocacy.鈥�&苍产蝉辫; 鈥� Liz Wroe

These issues are part of the government funding debates underway right now as a government shutdown looms. Depending upon the outcome with the September funding deadline, or the possibility of a supplemental funding bill this year, these ACA marketplace issues could be addressed in several sets of negotiations.  Now is the time to talk to your state officials, insurance commissioners, associations and contacts in the Federal government to ensure they have a good understanding of how these ACA marketplace changes will impact coverage in your state.

To hear the full discussion, you can find the replay and materials for the ACA webinar here, and download the full Wakely paper at .

Blog

Navigating the Post-Subsidy Cliff – Mitigating Premium Increases After Enhanced ACA Subsidies Expire

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As the end of 2025 approaches, the future of enhanced premium subsidies for Affordable Care Act (ACA) Marketplace coverage remains uncertain. These subsidies, extended by the Inflation Reduction Act (IRA), are set to expire December 31, 2025. Without congressional action, millions of Americans will face a sudden and significant increase in out-of-pocket premium costs, reintroducing the 鈥渟ubsidy cliff鈥� and raising the percentage of income that they will need to direct toward health insurance premiums. More than 16 million consumers who now receive subsidies will be affected, making this a critical issue for policymakers, payers, and consumers.

A new  from Wakely, an HMA Company, offers a timely and detailed analysis of the potential impacts and strategic considerations for stakeholders navigating this uncertain terrain.

How ACA Subsidies Are Calculated: The Mechanics Behind Premiums

The white paper explains that advance premium tax credits (APTCs) are designed to cap a household鈥檚 health insurance premium contribution at a specific percentage of income. The calculation is based on household income, size, the cost of the benchmark Second Lowest Cost Silver Plan (SLCSP), and age. The expiration of enhanced subsidies will revert contribution percentages to higher levels, increasing costs for all income brackets.

Premium Shock: Quantifying the Impact of Subsidy Expiration

Wakely鈥檚 analysis shows that the expiration of enhanced subsidies will result in a substantial increase in monthly premium contributions. For example, a hypothetical single 40-year-old at 150 percent of the federal poverty level (FPL) will see monthly premiums jump from $0 to $81.97 in order to keep the same plan.

Mitigation Strategy: Buying Down to the Lowest Cost Silver Plan

Consumers may offset part of the premium increase by switching from the SLCSP to the Lowest Cost Silver Plan (LCSP). The difference in premiums between these two plans translates directly into monthly savings, independent of income. In Raleigh, NC, a hypothetical 40-year-old could save $53.03 per month by buying down, mitigating about two-thirds of the premium shock. For older consumers, the savings are even greater; however, in highly competitive markets like Charlotte, NC, the premium gap鈥攁nd the savings鈥攚ill be much smaller, offsetting only a modest portion of the increase.

Consumer Savings

After applying the buy-down strategy, the net premium increase for a hypothetical single 40-year-old at 150 percent of the FPL in Raleigh will be $28.94 per month rather than $81.97 without mitigation. Depending on age and location, consumers can offset 37鈥�100 percent of the premium increase in less competitive markets, but only 7鈥�28 percent in highly competitive ones.

Market Dynamics: Why Local Competition Matters

The effectiveness of mitigation strategies depends on local market dynamics and competition. In markets with fewer carriers and larger premium gaps, consumers have greater opportunities to offset premium increases. In competitive markets, options are more limited. The paper notes that the 2026 landscape may shift due to carrier exits and price changes, underscoring the need for ongoing monitoring and adaptive strategies.

Recommendations for Payers, Regulators, and Brokers

  • Payers听should consider product design strategies that create meaningful premium gaps between Silver plans, where actuarially justified, to maximize consumer savings.
  • Regulators听can collaborate with insurers to support these strategies and, in state-based Marketplaces, may play an active role in limiting Silver offerings that erode premium gaps.
  • Brokers and Carriers听may want to market Bronze plans as a last-resort coverage option, as some consumers can access Bronze plans for free, which is preferable to going uninsured.

 Connect with Us

Wakely is experienced in all facets of the healthcare industry鈥攆rom carriers to providers to government agencies. Wakely actuarial and policy 量子资源s continually monitor and analyze potential changes to inform healthcare organization strategies and advance effective solutions to propel their success.

For questions about this analysis or to discuss strategies for navigating the post-subsidy cliff, contact听our 量子资源 below.

Blog

MAHA Children’s Health Strategy Report: Driving a New Era for Child Health Policy

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The September 2025 release of the “” marks a pivotal moment in the Trump Administration鈥檚 effort to address childhood chronic disease. Building on the work of the Make America Healthy Again (MAHA) Commission鈥攅stablished by in February 2025 and led by US Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr.鈥攖he Strategy Report provides a proposed road map for federal, state, and local action.

The MAHA child-focused Strategy Report is already driving the Trump Administration鈥檚 healthcare agenda. Though the report sets ambitious goals, public health entities, state governments, and other 量子资源s have raised concerns that several recommendations run counter to established scientific research or lack sufficient evidence.

In this article, 量子资源 (HMA) 量子资源s highlight the areas of focus in the Make Our Children Healthy Again Strategy Report and offer specific recommendations, initiatives, and considerations for stakeholders. Earlier editions of In Focus have addressed the commission鈥檚 formation, initial assessment, and the administration鈥檚 growing focus on childhood health (Spotlight on Development of President Trump鈥檚 Children鈥檚 Health Strategy).

Key Components of the MAHA Strategy

Advancing Critical Research to Drive Innovation

The strategy identifies broad areas of research to inform healthy outcomes and positions HHS to direct initiatives in collaboration with the US Food and Drug Administration (FDA), the Centers for Disease Control and Prevention (CDC), and other agencies. Examples include:

  • Support the MAHA Chronic Disease Initiative, advance the Real-World Data Platform linking data from claims, electronic health records (EHRs), and wearables
  • Establish a working group on mental health diagnosis and prescription, led by several HHS agencies, to focus on SSRIs (selective serotonin reuptake inhibitors), antipsychotics, mood stabilizers, and stimulants
  • Study food for health, with the National Institutes of Health (NIH) Office of Nutrition coordinating research initiatives across HHS and the US Departments of Agriculture and Veterans Affairs (VA)
  • Identify opportunities to strengthen the use of repurposed drugs for chronic disease
  • Address vaccine injury data collection and analysis, as well as mental health research focused on screen time and prescription practices

Realigning Incentives and Systems to Drive Health Outcomes

The report recommends improvements to transparency and efficiency in regulatory processes to address nutrition, fitness, pharmaceuticals and vaccines, and care delivery and payment to address chronic disease. Specific initiatives include:

  • Updating the Dietary Guidelines for Americans and developing an 鈥渦ltra-processed food鈥� definition
  • Promote breastfeeding through the Special Supplemental Nutrition Program for Women, Infants, and Children
  • Updating hospital food service nutrition guidance
  • Developing options to get 鈥淢AHA boxes鈥� of healthy food to Supplemental Nutrition Assistance Program (SNAP) enrollees
  • Support states with SNAP waivers to encourage healthy food purchases among SNAP participants
  • Enhance oversight of direct-to-consumer pharmaceutical advertising and develop a new vaccine framework
  • Establish Medicaid managed care quality metrics for nutrition coaching and fitness, and work with states to develop prescribing safeguards for school-age children
  • Promote evidence-based prevention and wellness initiatives and restructure agencies to reduce conflicts of interest

Increasing Public Awareness and Knowledge

Major campaigns will involve:

  • Launching the “Make American Schools Healthy Again” initiative to assist states with promoting physical activity and nutrition in schools
  • Expanding education on environmental exposures, fluoride, and pesticide safety
  • Increasing awareness of opioid dangers, vaping, and screen time impacts
  • Training school and library staff to respond to opioid overdoses

Fostering Private Sector Collaboration

The strategy emphasizes the administration鈥檚 work to advance private sector partnerships aligned with MAHA priorities, including partnerships to achieve the following:

  • Improve nutrition in government-funded programs (schools, VA hospitals, prisons)
  • Support community-led initiatives to reduce chronic disease in children

Key Considerations for Partners and Stakeholders

Early engagement is critical as federal agencies begin implementing over 120 recommended actions.

States, providers, health plans, and community organizations should identify how their current approaches to children鈥檚 health could align with the MAHA initiative and strategy report, as well as where these new ideas might conflict with present policies. This assessment will identify opportunities to maximize new federal funding opportunities and additional resources.

Progress toward the Strategy Report鈥檚 specific goals will require coordinated efforts across agencies, sectors, and communities. Stakeholders should consider how and when to engage in research, policy development, and public awareness campaigns outlined in the report.

Connections to Trump Administration Priorities and Broader Opportunities

The report鈥檚 recommendations are already influencing federal agency actions and are driving congressional hearings and new legislation at the federal and state levels.

The US Department of Agriculture鈥檚 (USDA), for example, is working with states to approve SNAP waivers to restrict the purchase of junk food with federal benefits. HMA 量子资源s are tracking the SNAP waiver actions, and as of September 2025, a total of 12 states have received USDA approval for waivers that restrict the purchase of soda, candy, and other unhealthy foods with SNAP benefits. Other states are considering similar waivers, and the USDA is providing technical assistance to support these efforts.

The FDA has enhanced oversight of direct-to-consumer pharmaceutical advertising, including new enforcement activities and rulemaking on drug safety disclosures in ads. This approach aligns with MAHA recommendations and Trump Administration priorities for transparency and consumer protection.

HHS is also pursuing a new vaccine framework; however, states retain significant authority over school-based immunization requirements, and several are considering alternative approaches or maintaining broader vaccine recommendations than those outlined in the MAHA report. Recent legislative actions in some states seek to shift authority for determining school-based immunization requirements solely to the legislature, reflecting ongoing debate and federal-state dynamics.

Connect with Us

As implementation of the Make Our Children Healthy Again Strategy Report advances, all stakeholders must be ready to engage, partner, innovate, and drive change that will shape the future of child health.

HMA guides state and local government, providers, plans and other partners through the multi-pronged strategies and recommendations in the report as well as the complexities of federal funding opportunities, such as the new Rural Health Transformation Program. We are helping state and local policymakers plan for MAHA and Trump Administration priorities, which includes guidance on how to leverage innovative approaches like SNAP waivers to promote healthy food access for children and families.

With deep 量子资源ise in policymaking and operational management, HMA consultants are enabling states and their partners to accelerate their work, build sustainable models for child health improvement, and position themselves to take advantage of new federal, state, and local policy opportunities driven by the MAHA report. To discuss questions about the impact of the report contact our 量子资源s below.

Blog

Rural Health Transformation Program Represents a One-Time Opportunity to Reshape Rural Care

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The Centers for Medicare & Medicaid Services (CMS) has officially opened the window for the (RHTP)鈥攁 $50 billion federal initiative designed to stabilize and transform rural health systems across the country. This one-time opportunity allows states to submit a comprehensive plan that could redefine how rural communities access care, manage chronic conditions, and sustain their healthcare infrastructure.

As outlined in our earlier In Focus article, , RHTP represents one of the most significant federal investments in rural health in decades.

Applications must be signed by governors and submitted by November 5, 2025, and awards are expected by December 31, 2025, providing states with a very narrow window to act.

The remainder of this article explains key aspects of the RHTP application, including the evaluation and scoring aspects. Notably, the structure of the scoring system will reward states that are already aligned with these , as well as those willing to implement new initiatives or make state policy changes to achieve alignment.

Program Overview and Funding Structure

Created under HR.1, the 2025 Budget Reconciliation Act, the RHTP allocates $10 billion annually from federal fiscal year (FY) 2026 to FY 2030, totaling $50 billion over five years. Funding is split into two tranches:

  • Tranche 1 (Baseline funding): $25 billion distributed evenly听across all states with approved applications.
  • Tranche 2 (Workload funding): $25 billion distributed based on CMS scoring criteria, which include:
    • The percentage of the state population in rural census tracts
    • The proportion of rural health facilities in the state
    • The financial and operational status of hospitals
    • Other factors explained in the RHTP application notice

States must submit a single, one-time that covers the full five-year period. Stand-alone provider applications will be declined. Hence, states must coordinate across agencies, providers, and stakeholders to develop a unified transformation strategy.

Importantly, this award is not a grant; rather, it is a cooperative funding agreement, which means CMS will play an active role in oversight and collaboration. States must be prepared to meet higher standards of accountability, transparency, and performance monitoring. According to the RHTP application, continued funding requires states to demonstrate satisfactory progress toward implementing their plan.

Application Requirements and Strategic Priorities

To be eligible for funding, states must submit a Rural Transformation Plan that addresses eight core priorities as follows:

Within these core priorities, state plans must propose activities that address several specific issues.

Technical Factor Weighting for Workload Funding Reflects Federal Policy Priorities

CMS outlines the eligibility criteria for baseline funding and the scoring components for workload funding. Baseline funds will be distributed equally among states, while workload funding will be based on each state’s rural facility and population score as well as their technical score. Evaluators will score technical factors based on state policy actions and initiative-based plans for each state.

The technical factors, and the weighting of these factors, in the RHTP application are not just neutral scoring mechanisms; rather, they are closely linked to the Trump Administration鈥檚 health policy priorities.

  • Weighting Structure: The RHTP funding is split evenly between baseline funding (50%) and workload funding (50%). Although baseline funding ensures all states receive support, the workload funding is directly tied to technical scores that reflect how well a state鈥檚 plan aligns with federal objectives and demonstrates readiness to implement transformative change that furthers federal objectives.
  • Scoring Criteria: Technical factors, such as rural population share, facility density, hospital financial status, scope of proposed activities, administrative capacity, stakeholder engagement, evaluation framework, and especially alignment with federal priorities, all contribute to the overall score. States that have already adopted or are willing to adopt federal policy priorities are positioned to score higher and receive more funding.
  • Annual Recalculation: CMS will recalculate each state鈥檚 technical score and workload funding annually to incentivize ongoing alignment with federal priorities and measurable progress toward transformation goals.
  • Alignment with Federal Priorities: One of the explicit scoring factors is 鈥淎lignment with Federal Priorities,鈥� which measures the degree to which a state鈥檚 plan supports CMS goals for rural health transformation and sustainability. Under the Trump Administration, these priorities may include promoting value-based payment models, encouraging technology adoption, advancing adoption of Supplemental Nutrition Assistance Program (SNAP) food restriction waivers that prohibit the purchase of non-nutritious items, availability of integrated care plans for the Medicare-Medicare dually eligible population, reporting of full Medicaid T-MSIS data, and align policies with federal guidance on short-term limited duration insurance plans.

Preparing for What Happens Next: Implications for States, Providers, and Health Plans

The RHTP offers a rare opportunity to reshape rural healthcare. But success will require strategic coordination and a commitment to long-term change. States in the short and long term should consider include:

  • Identifying stakeholders who will be involved: Hospitals, rural health clinics, federally qualified health centers (FQHCs), behavioral health providers, and community organizations must be part of the planning process.
  • Reexamining priorities: States will need to reconcile competing needs across regions and provider types, balancing infrastructure investments with service delivery redesign.
  • Understanding infrastructure needs to support their project: Technology, workforce, and models of care must be strengthened to support long-term transformation.
  • Designing evaluation frameworks: States must include robust performance monitoring and reporting mechanisms to meet CMS expectations and secure future funding.

Providers and other stakeholders should also prepare to align with state strategies. Examples include:

  • Participating in regional partnerships
  • Adopting new care models and payment arrangements
  • Investing in technology and workforce development
  • Contributing data and insights to support evaluation efforts

The scoring structure also incentivizes states that may not yet be fully aligned to implement new initiatives or make policy changes that would improve their technical scores and secure greater funding. States and their partners will need to be united on the goals and initiatives, disciplined about implementing and evaluating the plans based on data informed reports, nimble and willing to make strategic pivots based on feedback and experiences.

Connect With Us

States that are already aligned with Trump Administration priorities鈥攕uch as those with established value-based payment models, short-term limited duration plan options, preferred technology infrastructure, or strong rural hospital support policies鈥攁re positioned to be rewarded in the scoring and funding process.

量子资源 (HMA), is actively supporting states in developing compliant and compelling RHTP applications. Our advisory services include:

  • Strategic assessments and stakeholder engagement
  • Program design and grant writing
  • Implementation support and technical assistance
  • Actuarial support
  • Evaluation and performance monitoring

We help clients navigate the complexities of federal funding, align transformation goals with community needs, and build sustainable models for rural care delivery. For details about the RHTP, including the HMAIS State Action Tracker, contact HMA 量子资源s below.

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Building Bridges: Key Insights from the 2025 HCBS Conference and What They Mean for Your Organization

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This week, our In Focus features insights from the team of 量子资源 (HMA) 量子资源s who attended the . Over a handful of days, aging and disability leaders, state officials, health plans, providers, and advocates gathered to explore strategies to transform long-term services and supports. The event celebrated advances in cross-sector collaborations, evidence of program value, seamless access to care for older adults and people with disabilities, member engagement, and integrated care plans for dually eligible individuals.

HMA participants identified seven cross-cutting themes that are reshaping the aging and disability landscape. We examine how these themes connect to ongoing federal policy changes and provide actionable guidance for stakeholders looking to stay ahead of the curve in this evolving field.

Key Cross-Cutting Themes from the Conference                 

Executive Leadership Is Making the Difference

State leaders are developing new partnerships to continue progress toward meeting the needs of people with disabilities and aging adults across the lifespan. The conference showcased the significant progress that states have made by engaging governors and cabinet-level leaders. Pennsylvania’s aging department, for example, though small, leverages lottery funding and executive support to coordinate across departments and various strategic planning initiatives such as their multisector plan for aging.

North Carolina鈥檚 policy leadership in the governor’s office has been instrumental in aligning aging goals across state agencies such as the Department of Commerce on workforce initiatives and Department of Transportation which includes specific older adult needs in its planning.

Tennessee exemplified this approach by merging its Commission on Aging and Disability with the Department of Intellectual and Developmental Disabilities to establish g.

This executive engagement enables what Kathy Greenlee, former ACL Administrator, emphasized: building partnerships beyond traditional aging and disability networks including connections with children and families programs that share common goals around caregiver support and prevention.

Technology Is Extending Human Capacity, Not Replacing It

Technology took centerstage as one of the major solutions to providing personalized caregiver supports and extending the capacity of human services. States are embracing AI (artificial intelligence)-powered tools for routine tasks like call transcription and resource database management, while maintaining human oversight for complex client interactions.

The most successful approaches recognize what highlighted, “High tech won’t replace the need for high touch, but high touch is in short supply.” Technology networks can stretch caregiver capacity, but the human element remains essential. The next generation of service professionals must be tech-savvy integrators who combine digital tools with caring relationships. Key technological advances include digital and virtual coaching platforms, AI precision analytics for risk identification, and “home intelligence” systems that support aging in place. Success, however, depends on ensuring these tools enhance rather than replace human connection.

Direct Care Workforce Crisis Demands Immediate Action

Leading states are not just attempting to manage workforce shortages; they are working on comprehensive workforce infrastructure solutions. Wisconsin’s Certified Direct Care Professional program enrolled over 3,400 workers in its first year, reduced turnover rates, and created a statewide registry where employers actively recruit graduates. Michigan developed four-level stackable credentials that transform direct care into respected career pathways.

States are deploying integrated workforce platforms that combine multiple solutions, including worker registries that promote workforce access and transparency, learning management systems that strengthen development through credentialing, and job matching that enhances access to quality care, and data insights that support evidence-based decisions.

Missouri demonstrates effective stakeholder engagement through its Direct Support Worker Advisory Panel, where 15 workers provide feedback on rates, documentation, scheduling, and professional development while being compensated in developing the solutions, for example, by including them in official advisory entities.

Forward-thinking organizations are breaking down silos through cross-sector partnerships. Area Agencies on Aging and Centers for Independent Living are cross-training workers to serve both populations, effectively expanding the available workforce capacity. Technology integration scales solutions through online, self-paced training that accommodates work schedules and diverse learning needs, while states use federal funding and Medicaid rate increases to boost wages and implement recognition strategies that elevate professional status.

Evidence-Based Investment Strategies

States shared the power of systematic, data-driven approaches to secure aging and disability investments. Ohio’s disciplined four-step process鈥攊dentify priorities, determine evidence-based interventions, quantify return on investment, and operationalize results鈥攔esulted in

Under this reframing, aging can now be seen as an opportunity rather than a burden. States are building ecosystems and partnerships to enhance reach and effectiveness. This positions aging investments as competing priorities capable of delivering measurable returns. with career ladder pathways exemplifies how evidence-based workforce strategies can address critical shortages while improving quality.

The Urban Institute’s research on benefit uptake reveals that nearly 9 million older adults are eligible for programs they don’t receive. Success factors include coordinated state agencies, streamlined applications, community trust-building, and staff training鈥攁ll areas where evidence-based approaches can guide improvement.

Holistic Support for Caregivers and Care Members

The conference emphasized a fundamental shift from viewing caregivers as invisible helpers to recognizing them as partners who require comprehensive support. Key elements for achieving caregiver-driven outcomes include providing support, guidance, and assistance while measuring burden, resilience, satisfaction, and finally, the intent to remain in home settings. , reflecting growing recognition of how caregiver skill-building adds value. This holistic approach extends to addressing the question of who replaces the family caregiver, as older adults increasingly live alone. The answers rest with the development of new partnerships with retailers, pharmaceutical companies, and employers, plus technology that enables remote family support.

Cross-Sector Collaborations: Systems Integration as Survival Strategy

Breaking down silos that have historically separated aging, disability, children and families, and health services resonated throughout the conference. Kentucky observed that states struggle with multiple uncoordinated plans, each with different goals and measures.

Several states have demonstrated successful integration strategies, such as aligning funding streams, creating shared governance structures, and using common metrics across traditionally separate systems. North Carolina’s approach of embedding aging considerations in transportation planning and commerce workforce development shows how integration can extend beyond human services.

From a federal perspective, integration has support. As Greenlee noted, the Administration for Children, Families, and Communities includes “communities” in its title as a signal of broader inclusion. States that build partnerships across these traditionally separate areas will be better positioned for future federal funding and policy changes.

MLTSS as a Critical Vehicle for Whole-Person Care

Managed Long-Term Services and Supports (MLTSS) programs are evolving an infrastructure for providing coordinated and integrated care delivery care. As this transformation occurs, states must have adequate oversight capacity to manage MLTSS programs effectively.

Effective MLTSS programs can help people early enough to prevent nursing facility placement by integrating all services including medical, behavioral, and HCBS and social supports through capitation. Plans should allocate resources to support provider technological investments that facilitate improved care coordination. This technological support becomes essential to maintaining the high-touch, personalized services that MLTSS members require while achieving the scale necessary for program sustainability.

Policy Connections: From Conference Themes to Federal Action

These conference themes reflect broader federal policy shifts, including:

  • New funding must be used more strategically. The $10 billion annually for rural health transformation (2026鈥�2030) can also create opportunities to integrate aging services into the broader health infrastructure.
  • Resource constraints sparks innovation. As the Administration for Community Living faces resource constraints with significant staff reductions, states must be more proactive and resourceful in developing innovative programs.
  • Advocacy must be timed. Upcoming budget cycles require strategic timing for advocacy efforts.

The Road Ahead for Stakeholders

Organizations across the aging and disability ecosystem must prepare for a more integrated, technology-enhanced, and evidence-driven environment. Success will require executive leadership, strategic partnerships, and measurable value.

State Agencies

  • Engage executive orders establishing aging as a priority across all state departments.
  • Developing systematic evidence-based investment strategies that quantify return on investment for aging initiatives, using Ohio’s four-step methodology as a template.
  • Building partnerships beyond traditional aging and disability networks, including with children and family services, workforce development, and transportation agencies.
  • Implementing workforce development strategies that include investing in credentialing and tech-enabled training, and cross-sector partnerships to address to strengthen the direct care workforce.

Health Plans and Payers

  • Implementing holistic caregiver support programs that combine digital tools with human coaching, measuring outcomes like burden reduction and care member satisfaction.
  • Leveraging new Medicare coding opportunities for ADL/IADL supports to pay for evidence-based caregiver training and skill-building programs.
  • Partnering with technology companies to deploy AI-powered risk identification tools while maintaining human oversight for member interactions.
  • Investing in provider technology infrastructure that enables better care coordination and supports MLTSS program effectiveness.

Providers and Community Organizations

  • Developing technology-enhanced service delivery that extends human capacity while preserving personal connection, following the “high tech, high touch” principle.
  • Pursuing evidence-based training and credentialing programs with clear career pathways.
  • Building partnerships with non-traditional allies like retailers, pharmaceutical companies, and employers to expand aging-in-place support networks.
  • Participating in workforce development initiatives that create shared worker pools across aging and disability services.

Technology Vendors

  • Developing AI-powered tools that enhance rather than replace human service delivery, focusing on routine tasks like documentation and risk assessment.
  • Creating integrated platforms that support cross-system coordination between aging, disability, health, and family services.
  • Building home intelligence systems that enable remote family caregiving and professional monitoring while preserving independence and dignity.
  • Designing workforce development platforms that support credentialing, job matching, and career advancement tracking.

Moving Forward Together

The 2025 HCBS Conference revealed a field that is embracing innovation and integration. States leading this transformation share common characteristics: executive leadership, evidence-based investment strategies, technology that enhances human connection, holistic support approaches, and systems that collaborate to break down traditional silos.

The path forward requires strategic planning, rigorous evaluation, cross-sector partnerships, and sustained political will. Organizations that can integrate evidence-based approaches with compassionate care, leverage technology to extend human capacity, build partnerships that transcend traditional boundaries, and develop sustainable workforce solutions, will be best positioned to serve the growing population of older adults and people with disabilities.

Connect with Us

The HCBS Conference highlighted significant momentum toward integrated service delivery, evidence-based investment, and technology-enhanced care. Stakeholders should expect continued federal policy evolution, including new funding opportunities and partnership requirements in the coming years. Organizations that wait will miss critical opportunities. HMA works with state agencies, health plans, providers, and community organizations to design and implement aging and disability initiatives. We help clients engage executive leadership, develop evidence-based business cases, deploy appropriate technology solutions, build cross-sector partnerships, and create sustainable workforce development strategies. To discuss how these trends affect your organization and explore next steps, contact our featured 量子资源s below.

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States Begin to Engage with the Rural Health Transformation Program

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The Rural Health Transformation Program (RHTP) established in H.R. 1 represents one of the most significant federal investments in rural healthcare in decades. With $50 billion allocated between fiscal years 2026 and 2030, the program is designed to stabilize and transform rural health systems nationwide by supporting infrastructure, workforce development, and innovative care delivery models.

Administered by the Centers for Medicare & Medicaid Services (CMS), the RHTP requires each state to submit a one-time application detailing a comprehensive rural health transformation plan. These plans must address eight core priorities, including improving access and outcomes, leveraging technology, fostering regional partnerships, and ensuring long-term financial solvency for rural entities. The Centers for Medicare & Medicaid Services (CMS) has posted the , with application materials expected to become available in mid-September and state submissions due in late fall 2025.

The 量子资源s at 量子资源, including our Information Services team (HMAIS), are tracking several state-level indicators and actions, including lead state agency points of contact, regulatory and public comment deadlines, and links to official notices. Following are the key takeaways from HMAIS State Action Tracker鈥攁 living resource for HMAIS subscribers, which will be updated with federal and state-level details such as state-selected RHTP categories and award amounts.

Initiative Alignment and Partner Engagement: Common Themes Across States

As of early September 2025, at least 15 states have begun structured intake to inform initiatives and uses of the RHTP funding鈥攔equests for information (RFIs), surveys, town halls, webinars鈥攚ith others maintaining a planning posture pending release of CMS鈥檚 application template.

Common themes and approaches emerging from these activities include:

  • Category-aligned input.听States are encouraging stakeholders to align proposals with the statute鈥檚 eligible activities (e.g., access, outcomes, technology/prevention, partnerships, workforce, data/IT, solvency). Examples include:
    • 听requires submissions to identify which of the nine categories are addressed and to discuss outcomes and sustainability.
    • Delaware and听听use structured prompts to sort feedback by activity type.
  • Pre-guidance tools.听States like听听听and听听are using RFIs and statewide surveys to gather ideas and identify viable projects before CMS guidance is finalized.
  • Tech-enabled care.听New and expanded uses of technology are topics of interest to states that are seeking ideas on how to maximize investments in remote monitoring, artificial intelligence (AI)/robotics, data/analytics, and IT/cybersecurity as eligible investments for improving access to services, healthcare delivery, and workforce support. For example:
    • 听explicitly references technology-enabled care models.
    • 听and听听highlight health IT/cybersecurity and value-based purchasing.
  • Local coordination.听States are encouraging regional partnerships/community hubs and rebalancing or right sizing service lines to match local demand.听听and听听emphasize right sizing service lines and coordinated care across the continuum of pre-hospital, emergency, acute inpatient, outpatient, and post-acute services.听听solicitation prioritizes regionally coordinated partnerships and explicitly calls out right sizing the care continuum as a focus area.听听highlights strengthening partnerships between rural hospitals and other providers as a required component of the state plan.
  • Sustainability and value-based readiness.听States are asking how projects will be sustained after federal funding ends and how these can support and sustain alternative payment models.听听and听听request implementation details and financial durability plans.听听prompts discussion of how proposals enable care coordination and payment reform.

Looking Ahead

The emerging national landscape for RHTP initiatives is mixed. Early state movers and their engaged partners are building momentum and reducing execution risk, while others are preserving flexibility until additional federal guidance arrives. States waiting on CMS鈥檚 template may face challenges in coordinating stakeholders and finalizing priorities before the application deadline.

For providers and community-based organizations (CBOs), now is a critical time to engage. These organizations are uniquely positioned to shape state applications by sharing on-the-ground insights, identifying unmet needs, and proposing scalable, sustainable solutions. Participating in state RFIs, surveys, and town halls allow providers and CBOs to inform how funding is prioritized and deployed.

To prepare for the RHTP resources and support, healthcare organizations should:

  • Monitor state-level engagement opportunities and respond to RFIs or surveys with clear, category-aligned proposals
  • Build or strengthen partnerships with other local organizations to demonstrate regional coordination
  • Assess internal capacity to implement and sustain projects beyond the federal funding window
  • Document outcomes and financial models that support long-term viability and alignment with value-based care

Connect with Us

To support transparency during this fast-moving period, HMAIS has launched the RHTP State Action Tracker, a centralized resource for curating each state鈥檚 actions, agency leads, deadlines, and links to official notices. The tracker will be updated as CMS guidance is released and as states fill in details, such as selected categories and award amounts. For details about the RHTP, including the HMAIS State Action Tracker, contact HMA 量子资源s听below.

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Federal Shifts and the Potential Impacts on Healthcare Quality Oversight

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This week, our听In Focus听section explores how recent federal shifts鈥攑articularly under the Trump Administration鈥攁re reshaping healthcare quality oversight. 量子资源 (HMA) has published several analyses on the 2025 Budget Reconciliation Act (H.R. 1, formerly known as the One Big Beautiful Bill), Title IV of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA), and the 2025 Centers for Medicare & Medicaid Services (CMS) Quality Conference. Together, these federal changes and the policy priority shifts described at the Quality Conference, have implications for monitoring and oversight of healthcare quality for publicly insured, commercially insured, and uninsured individuals.

In this article, HMA 量子资源s highlight potential areas for state Medicaid programs, healthcare organizations, and other industry partners to watch for as the rollout of new policies and programs begins to affect programs that monitor quality and creates the imperative to develop new oversight mechanisms.

Overview of Key Federal Policy Shifts

2025 Budget Reconciliation Act/H.R. 1

In July 2025, President Trump signed H.R. 1, the sweeping budget reconciliation legislation that directly affects publicly financed health coverage. Notable policy changes with quality implications include:

  • Mandatory six-month redetermination and community engagement for select populations
  • Stricter rules on healthcare-related provider taxes and state-directed payment policies
  • Elimination of Affordable Care Act (ACA) subsidy eligibility for certain lawfully present immigrants
  • An end to conditional eligibility for ACA subsidies, as well as passive re-enrollment
  • Required compliance with community engagement and work policies

Personal Responsibility and Work Opportunity Reconciliation Act of 1996

On July 10, 2025, the US Department of Health and Human Services () and other agencies, redefined 鈥渇ederal public benefits鈥� to exclude individuals with 鈥渦nsatisfactory immigration status鈥� from certain healthcare programs. Examples include Certified Community Behavioral Health Clinics (CCBHCs), Community Health Centers/Federally Qualified Health Centers (FQHCs), grant-funded programs administered by the Substance Abuse and Mental Health Services Administration (SAMHSA), and Title X Family Planning.

2025 CMS Quality Conference

During the 2025 , Centers for Medicare & Medicaid Services (CMS) Administrator Dr. Mehmet Oz and senior CMS officials, emphasized CMS鈥檚 and HHS鈥檚 evolving priorities under the Trump Administration. Notable priorities include empowering patients with data, reducing waste and tackling fraud, focusing on prevention, and transitioning to digital quality measures.

Quality Oversight Impacts

Key impacts on quality monitoring programs resulting from these federal changes and evolving priorities include:

Budget constraints elevate monitoring and value-based care metrics. Reduced Medicaid funding and tighter payment rules heighten the need for real-time monitoring of value-based care metrics to ensure financial sustainability in the changing market, optimize reimbursement.

Enrollment changes challenge quality tracking. Tighter eligibility and enrollment policies are expected to decrease enrollment in Medicaid (particularly among the adult expansion population) and the Affordable Care Act Marketplace program. Frequent redeterminations may cause coverage gaps and churn, distorting quality measure denominators and complicating performance tracking 鈥� especially for preventive and chronic care metrics.

Specifically, as the population mix in publicly funded programs changes or as gaps in enrollment exceed the 30鈥�45-day continuous enrollment criteria for many quality measures, the eligible population/denominators of quality measures will likewise fluctuate. Populations that lose coverage or churn on and off eligibility rolls can result in differential impacts for various quality measures (e.g., healthier individuals losing coverage affects prevention measures more than measures of chronic disease care).

Although performance on value-based care quality measures will have increased importance, the ability to track and trend performance will be increasingly challenging. Healthcare organizations will benefit from forecasting potential changes to patient mix and volume and real-time monitoring and improvement opportunities.

Rise in uncompensated care requires new quality monitoring. H.R. 1 changes that reduce eligibility, paired with PRWORA changes that limit treatment for certain individuals who receive public benefits, are likely to lead to increases in the uninsured population and inhibit access to preventive care. These populations tend to use emergency departments more often for health issues that could have been treated earlier or more effectively in outpatient settings, yet quality oversight is limited for populations that receive care outside of publicly or commercially funded programs. New mechanisms for quality oversight鈥攁nd funding of those mechanisms鈥攚ill be needed to monitor the health of these populations.

New programs and priorities warrant updated monitoring. H.R. 1鈥檚 Rural Health Transformation Program and CMS鈥檚 dual-track quality measurement approach (鈥渢reating illness鈥� versus 鈥渕aintaining health鈥�) necessitate a reevaluation of current metrics and monitoring systems.

Implementation of digital quality measures will support these efforts when fully implemented. The accelerated movement toward digital quality measurement and interoperability may create an imperative for healthcare organizations to make the shift. For example, the transition to digital quality measures will be necessary to ensure real-time oversight and improvement of quality measures, population health analytics, maximizing value-based care payments and efficiencies needed to effectively respond to federal changes. At the same time, healthcare organizations will need strategies to effectively deploy digital quality and interoperability within and across their organizations to not just comply, but to maximize their capabilities.

Connect with Us

HMA works with state agencies, payers, health systems, and providers to assess and implement quality systems, value-based care programs, performance improvement and digital health. To discuss how federal changes will affect your organization鈥檚 quality programs, contact our featured 量子资源s below.

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Building Rural Health Together: Reflections from the Ohio Rural Health Association Conference

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Earlier this month colleagues from 量子资源 (HMA) attended the 2025 Ohio Rural Health Association Conference. The gathering brought together providers, policymakers, and advocates from across the state to discuss one of the most pressing issues of our time: the future of rural health care in an uncertain policy and financial environment.

At a moment when federal funding and regulatory debates dominate the headlines, what stood out most was the energy and commitment among local leaders to work together on practical solutions. The challenges facing rural communities are profound鈥攈ospitals and clinics strained by reimbursement shortfalls, workforce shortages threatening access, and shifting payer dynamics creating new administrative burdens. Yet the conversations throughout the conference were grounded in resilience and collaboration, demonstrating that sustainable solutions begin at the community level.

Spotlight on Collaboration

HMA was honored to contribute to this dialogue through three sessions focused on core issues shaping rural care.

  • Kenneth Cochran, DSc, RN, FACHE, drew on his deep leadership experience as a former Ohio hospital CEO to highlight the urgency of workforce development. With projections of a 187,000-physician shortfall by 2037, Ken outlined integrated workforce strategies鈥攁pprenticeships, housing partnerships, and a culture of continuous learning鈥攖hat can help stabilize rural hospitals and strengthen community health infrastructure.
  • Courtney Smith, RHIT, CCS, shared two critical perspectives. First, she unpacked the growing strain of Medicare Advantage in rural communities, where reimbursement often falls short and administrative requirements delay patient care. Second, she explored the complexities of Medicaid revenue cycle management, offering actionable steps rural providers can take鈥攆rom leveraging technology and analytics to streamlining wrap-around payment reconciliation鈥攖o maintain stability in an unpredictable environment.
  • Jennifer Shaw, Senior Consultant, co-presented on best practices for navigating payer relationships with Courtney. She underscored how rural providers can use data to strengthen negotiations and how collaboration across hospitals, clinics, and associations creates the leverage necessary to ensure fair treatment in contracting and payment.

These discussions demonstrated the value of having clinical, operational, and policy perspectives at the table. Each HMA colleague brought not only technical 量子资源ise but also a deep appreciation for the lived realities of rural providers, ensuring our sessions were rooted in practicality.

A Landscape in Flux

The national policy context reinforces the importance of this work. Recent debates in Washington over rural health funding underscore just how fragile the financial footing of many hospitals and clinics can be. While the outcome of federal policy is uncertain, what is clear is that communities cannot afford to wait.

As HMA has noted in our broader work on rural health, effective solutions hinge on collaboration across sectors and levels of government. Whether it鈥檚 building workforce pipelines, ensuring fair payment, or streamlining operations, progress requires alignment among providers, payers, policymakers, and communities themselves.

Moving Forward

The Ohio Rural Health Association conference was a reminder that even in uncertain times, there is a powerful foundation for innovation and problem-solving when rural providers work together. HMA is proud to support these efforts, bringing decades of experience in Medicaid policy, health system transformation, and rural health strategy to bear for our partners.

As we look ahead, one lesson stands out: the path forward for rural health will not be written in Washington alone. It will be forged in places like Ohio, where providers, leaders, and communities are building practical, collaborative solutions every day.

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Executive Order Addressing Homelessness: The Federal Shift Toward Institutionalization

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President Trump signed an executive order (EO), , on July 24, 2025, signaling a significant shift in federal homelessness policy and the requirements for organizations that use federal dollars to address homelessness in their communities. The order emphasizes public safety and prioritizes institutionalization and mandatory treatment over housing first approaches.

The administration asserts that 鈥渢he overwhelming majority of these individuals are addicted to drugs, have a mental health condition, or both鈥� and calls for transitioning homeless individuals into long-term institutional settings through civil commitment for 鈥渉umane treatment.鈥� Below, 量子资源 (HMA) outlines key elements of the EO, including provisions, key stakeholder considerations, and potential strategies to maintain care continuity amid federal changes.

Key Elements of the Executive Order

End of Housing First: The EO discontinues support for the Housing First model, directing federal agencies to prioritize mandatory treatment. The Department of Housing and Urban Development (HUD) Secretary is directed to take steps requiring treatment participation as a condition of HUD program participation.

Support for Civil Commitment Infrastructure: The federal government will assist state and local governments with technical guidance, grants, and other resources to implement civil commitment, institutional treatment, and step-down treatment standards. The Attorney General and US Department of Health and Human Services (HHS) Secretary are instructed to pursue reversal of legal precedents that restrict civil commitments for individuals with mental illness who pose risks or are unable to care for themselves.

Restructuring Federal Programs: The EO directs HHS, HUD, and the Departments of Justice (DOJ) and Transportation (DOT) to review discretionary grants and restructure programs to ensure compliance with the new guidelines, as outlined below.

  • HHS Substance Abuse and Mental Health Services Administration (SAMHSA) grants will no longer support harm reduction or safe consumption efforts and has听听a 鈥淒ear Colleague鈥� letter clarifying which services will be funded; for example, naloxone distribution can be funded, but clean syringe distribution cannot.
  • HUD will exclusively, where permissible, fund programs for women and children and revise regulations to exclude registered sex offenders.
  • Some emergency law enforcement funds may be allocated for encampment removals.

Expanded Roles: The EO directs HHS to leverage the use of federally qualified health centers (FQHCs) and Certified Community Behavioral Health Clinics (CCBHCs) to reduce homelessness and ensure federal funds support crisis intervention and comprehensive behavioral health services. In addition, the Attorney General is directed to prioritize funding for the expansion of drug and mental health courts.

Notably, federal grants will prioritize jurisdictions and states that enforce laws against open drug use, urban camping, urban loitering, and urban squatting. Grant recipients must also share certain health-related data with law enforcement, as permitted by law.

Considerations for Stakeholders

States, local governments, and county jurisdictions must assess housing and homeless programs that use federal funding streams. They must consider the implications of their current program activities and, where possible, realign programs with new requirements. They may gain access to new funding for treatment beds, drug and mental health courts, crisis response, and law enforcement support but risk losing funding for those programs that use harm reduction or housing first models. Local governments could face increased jail overcrowding and legal challenges related to civil commitments and data sharing. Early examination of current programs, particularly HUD and crisis programs, as well as early planning, will be essential.

Providers may need to restructure services to comply with the new mandates, including collaboration with crisis/removal entities and law enforcement and expanded reporting. Emergency department and inpatient facilities may see increased demand, especially from uninsured individuals.

State behavioral health authorities and other stakeholders can benefit from forming advisory councils to develop ethical frameworks for civil commitments, as well as consider providing training for providers and law enforcement and propose revisions to state statutes and regulations

Homeless individuals are likely to experience increased policing, institutionalization, and loss of access to non-mandated services and housing.

What Happens Next

Federal agencies are now responsible for implementing the EO, revising grant programs, issuing guidance, and shifting funding priorities toward enforcement and institutional treatment. These changes will redefine compliance for local governments and service providers.鈥�

Health and housing organizations must quickly assess the implications of this policy shift. Strategic collaboration across sectors, including behavioral health, housing, law enforcement and judicial systems, will be essential to maintain care continuity and protect individual rights.

Connect with Us

HMA鈥檚 housing and homelessness and behavioral health 量子资源s are closely monitoring the evolving federal policy landscape and legal developments. We are tracking federal funding shifts, priorities, and opportunities across HHS, HUD, DOJ, and DOT, helping stakeholders align their programs with new priorities to enhance eligibility and impact.

For details about federal agency implementation of the EO and downstream effects, contact our featured 量子资源s below.

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Addressing the Growing Crisis in Older Adult Behavioral Health

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Imagine a 77-year-old man named Don who lives alone in his small apartment after his wife, Marcia, suddenly died a year ago. She had been his constant companion and long-time caregiver, making sure he took his medications for diabetes and bipolar disorder. Now he is socially isolated, lonely, and depressed. When he neglects to eat, his blood sugar levels tend to drop, and he becomes light-headed. He won鈥檛 call his doctors then; he doesn鈥檛 want to bother them. Besides, it was his wife who used to communicate with his doctors and psychiatric team about any concerns. Without her, he doesn鈥檛 have much motivation to do anything.

Don illustrates several U.S. demographic and epidemiologic trends:

He is a 鈥淏aby Boomer鈥� driving the ongoing aging of this country. Within the next 20 years, the number of Americans aged 65 and over will exceed the number of those under 18. The population of working age, including those available to care for older adults, will decline by 5 percent. As a result, the emerging care gap between the numbers of Americans who need care and those who can provide it will greatly increase.

Like greater numbers of older Americans, he has at least two chronic illnesses, adversely affecting his overall functioning and quality of life. According to a 2025 Centers for Disease Control research summary, chronic conditions put him at risk for higher healthcare costs[1]. The combination of chronic physical and mental health conditions will likely mean very high health care costs.

Like increasing numbers of older Americans, he has a behavioral health disorder. About 25% of older adults have a diagnosable mental, substance use, and/or cognitive disorder. These conditions are often exacerbated by social isolation and loneliness, which is associated with increased rates of both mental and physical health problems.

Unfortunately, about half of older adults with mental or substance use disorders do not get treatment or are treated by primary health care providers who have limited training in addressing geriatric psychiatric concerns. As a result, only about a third of people who get treatment receive what is “minimally鈥� adequate treatment. Only about half of those who get treatment from mental health professionals receive adequate care.

The low utilization by older Americans of behavioral health services reflects several access challenges including: 

  • Access to providers who are clinically, culturally, linguistically, and generationally competent are in short supply. The shortages are most acute for rural residents. There is also a shortage of geriatric mental health professionals participating in the Medicare program.
  • Service access is also problematic. Many treatment programs are in hard-to-reach locations. There is also a tremendous shortage of services in home and community settings, due to workforce shortages.
  • Discrimination including stigma and ageism, plus the lack of awareness about mental illness and the effectiveness of treatment result in reluctance to seek or accept behavioral health services.

Unlike many of his contemporaries suffering from a behavioral health condition, Don does have long-standing behavioral health treatment which has been effective for most of his lifetime for managing his bipolar disorder. But without his wife鈥檚 support, his attendance and adherence have faltered. He now needs other sources of support and guidance, as well as more intensive treatment, or he faces several major risks:

  • He may wind up being taken by ambulance to hospital emergency rooms for falls. *
  • He may be admitted to the hospital for broken bones, diabetic complications, or even a stroke or heart attack.
  • He may deteriorate further and become unable to care for himself, eventually transferring from a hospital to a long-term care facility.
  • He may suffer premature death.

Older Americans, like Don, need not suffer injury and decline in addition to grievous loss. With the right systems of behavioral health, supported by care coordination and person-centered care plans, they can recover, adapt, and remain in their homes, as most Americans prefer.

HMA has the 量子资源ise to create and strengthen those systems of care. To learn more about How HMA Can Help.

[1] Watson KB, Wiltz JL, Nhim K, Kaufmann RB, Thomas CW, Greenlund KJ. Trends in Multiple Chronic Conditions Among US Adults, By Life Stage, Behavioral Risk Factor Surveillance System, 2013鈥�2023. Prev Chronic Dis 2025;22:240539. DOI:

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Medicaid Managed Care Profitability: Navigating Margin Pressures and Regulatory Shifts in 2024

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This week, our In Focus section highlights findings from 量子资源 Information Services鈥� (HMAIS鈥檚) review of 2024 statutory filings submitted to the National Association of Insurance Commissioners (NAIC). These filings provide a nationwide view of Medicaid managed care plan profitability and medical loss ratios (MLRs) across 221 plans operating in 39 states, the District of Columbia, and Puerto Rico.

These data build upon and offer additional context to a previous  conducted by HMA and Wakely, an HMA Company, of increasing post-pandemic financial pressures driven by acuity increases resulting from the continuous eligibility unwinding and increases in behavioral health and home and community-based services access and utilization.

Medicaid Managed Care Underwriting Gains and Losses

As state Medicaid programs have increasingly moved from fee-for-service to managed care, a foundational assumption has been that efficient managed care organizations (MCOs) reduce waste and deliver high quality, cost-effective healthcare services. This transition has made Medicaid plan performance and sustainability a central focus for policymakers and actuaries alike.

Medicaid capitation rates must be actuarially sound, which means they must be projected to cover all 鈥渞easonable, appropriate, and attainable costs,鈥� including medical administrative costs, plus a margin for insurance risk, even for nonprofit plans. According to the Society of Actuaries 2024 , average underwriting margins in Medicaid rates ranged from 0.35 percent to 3.15 percent, with a consistent average between 1.2 percent and 1.3 percent.

However, actual results often deviate from projections for reasons that may be challenging to predict. Rate setting is an inherently forward-looking process, and even with conservative assumptions, unexpected shifts in enrollment, acuity, or service utilization can lead to significant deviations from projected results. Retrospective reviews show variability in margins over time (see Figure 1).

Figure 1. Historical Medicaid MCO Net Gains/Losses, 2012鈥�2024 (39 States, DC)

Based on HMAIS鈥檚 analysis, Medicaid MCOs sustained modest but steady gains from 2012 through 2017. After a decline between 2016 and 2019, margins rebounded to approximately 3 percent until 2022, narrowed in 2023 to 1.9 percent, and turned negative in 2024 at -0.9 percent.

For the first time in over a decade, more plans experienced losses than gains in 2024 (see Figure 2), with only 42 percent reporting positive margins, down from the decade high of 84 percent in 2022. This shift raises critical questions about sustainability and participation in Medicaid managed care.

Figure 2. Medicaid Managed Plans Likelihood of Gain, 2012鈥�2024 (39 States, DC)

The 鈥淟ikelihood of Gain鈥� chart tracks the percentage of Medicaid managed care plans reporting an underwriting gain each year from 2012 to 2024. For most years, the likelihood that a plan posted a gain was relatively high, typically between 60 percent and 80 percent. The probability reached a recent peak in 2022, with 84 percent of plans reporting gains, and remained elevated in 2023 (74 percent). In 2024, however, the likelihood of gain dropped sharply to just 42 percent, the lowest level in the 12-year period.

Risk Corridors, Medical Loss Ratios, and Structural Policy Shifts

MLRs show the portion of plan revenue spent on medical care as compared with the costs to operate the plan and the underwriting gain or loss described previously. When MLRs rise or fall, it can be an indication that medical cost trends experienced by health plans differ from the assumptions used by state rate setting actuaries. High MLRs are the key driver of underwriting gains, and low MLRs are associated with higher profitability. All states report MLRs to the Centers for Medicare & Medicaid Services (CMS), and some enforce minimum MLRs with a remittance provision, requiring plans to return funds if their MLR goes below a certain level.

Risk corridors are another tool that states use to manage financial volatility. These mechanisms share gains or losses between plans and states when results deviate significantly from pricing assumptions, offering protection to MCOs and the state alike, in contrast to minimum MLR provisions with a remittance provision, which only protects the state. During the COVID-19 pandemic, many states implemented or expanded risk corridors to recoup overpayments because of lower utilization. Some risk corridors were set retroactively鈥攁 practice CMS now prohibits.

In 2024, MLRs reached a decade high of 90.8 percent, as indicated by HMAIS鈥檚 analysis. Driving this increase were heightened utilization rates, increased enrollee acuity, and the end of continuous Medicaid coverage protections in 2023. As healthier, lower-cost members left Medicaid, plans were left serving a more complex population with higher per-member costs. Inflation in medical costs鈥攅specially for behavioral health and home and community-based services鈥攁dded more pressure. Delayed or avoided care during the COVID-19 pandemic may also have played a role, as members sought more services in 2022鈥�2024, resulting in a surge in utilization greater than what was priced into rates.

Many states put risk corridors in place to stabilize margins from 2020 to 2022, which may have contributed to the tight band of outcomes around the high underwriting gains in that period. However, many states have been  them for 2024, 2025, and 2026. Without these protections, plans may face greater exposure to underpayment in 2025 and 2026 if cost trends continue to outpace rate assumptions.

What to Watch

Rate setting conversations between states and plans for 2026 are happening now, and in many cases they are quite challenging. In addition to meeting actuarial soundness requirements, states also must balance their budgets, and some may be facing limitations on their traditionally used tools.

Looking ahead, it will be increasingly important that states and plans partner to find cost savings that can ensure the program鈥檚 long-term sustainability.

A subscription to HMAIS provides access to comprehensive financial intelligence on Medicaid managed care. Far beyond surface-level snapshots, HMAIS delivers health plan-level financial performance metrics, enrollment trends, and state policy developments that directly shape rate setting and operational strategy. Whether you鈥檙e a state official, health plan executive, or policy strategist, HMAIS provides the financial clarity and policy context needed to anticipate regulatory shifts, benchmark performance, and make confident, data-driven decisions.

For questions about the analysis discussed in this article, contact our 量子资源s below.

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