Key Themes from 2025 and Predictions for 2026  

2025 brought key changes to health policy across the board. As HPN does each year, we have summarized key updates from 2025 and shared our predictions on likely developments and what to watch in 2026. 

Medicaid

H.R. 1

Major changes to Medicaid were rolled out in July as part H.R. 1. PCG subject matter experts provided a summary of the Medicaid provisions; some provisions are already in effect while others phase in over time through 2028. 

Following passage of the legislation, the Centers for Medicare and Medicaid Services (CMS) launched a website on the “Working Families Tax Cut Legislation” and has rolled out some initial guidance, including a Centers for Centers for Medicaid and CHIP Services (CMCS) Informational Bulletin (CIB) and slide deck, which both provide general information on the Medicaid and CHIP provisions contained in H.R. 1 and lay out plans for future guidance and rulemaking. The webpage also includes initial guidance on state directed payment and provider tax changes and links to more information regarding rural health and community engagement, both of which are detailed further below. 

Community Engagement 

Prior to the passage of H.R. 1, HPN provided insight to the Community Engagement Requirements (also known as “Work Requirements”) under consideration at the state and federal level – a provision that ultimately was included in H.R. 1. PCG also published a toolkit to assist states as they navigate implementation, including operations considerations. 

CMS launched a dedicated webpage on the H.R. 1 Community Engagement Requirements (CERs) and – in follow-up to its November CIB, which is outlined above and includes information regarding the CER provisions – CMS published a subsequent CIB and slide deck dedicated to CERs in early December. This recent guidance provides clarity around who must comply, population exemptions, qualifying activities, state outreach requirements, and implementation timelines. The CIB also addresses the funding that will be available to states to support implementation – with $100 million to be distributed equally among states and $100 million to be distributed to states based on each state’s share of individuals subject to CERs. This is in addition to the enhanced federal financial participation (FFP) Medicaid match funding for certain costs associated with upgrades to Medicaid IT systems. 

Looking forward, states face significant operational and policy challenges in implementing the H.R. 1 CERs by the end of 2026. They must conduct extensive, effective outreach to Medicaid enrollees well in advance, while simultaneously building new administrative infrastructure and workforce and updating IT systems to track compliance and verify qualifying activities with existing data. From a policy standpoint, states will need to submit a State Plan Amendment (SPA) to CMS, which is expected to release a template in mid-year. Future CMS guidance will be critical in providing guardrails, resources, and expectations to help states navigate these changes. States should take full advantage of the forthcoming grant opportunities, as planning for and implementing these new requirements will place additional strain on state budgets. 

Rural Health Transformation Program  

Among the earliest H.R 1 provisions requiring state attention was the Rural Health Transformation Program (RHTP), which provides $50 billion nationwide to fund state rural health initiatives related to: 

• • Prevention and chronic disease management 

• • Ensuring access to services, including behavioral health and substance use disorder treatment 

• • Promoting use of technology and telehealth 

• • Improving health care quality and outcomes 

• • Development of innovative payment models 

• • Workforce development   

In addition to sharing an overview of the opportunity, HPN highlighted particular opportunities for support of Emergency Medical Services following publishing of the Notice of Funding Opportunity. CMS has launched a dedicated webpage with information about the RHTP. 

All 50 states submitted funding applications by the deadline; PCG subject matter experts created “Rural Health Transformation Program:  Summary of State Applications “- a summary of publicly available applications for use by states and policy makers to utilize as they start thinking about implementation. With 50% of the funds allocated by an assessment of the applications, states now eagerly await the funding decisions by the end of the month. 

Looking forward to 2026, once states learn how much funding they will receive, they will turn toward implementation. Importantly, failure to meet proposed milestones each year will impact funding for future years, so states will need to ensure that implementation remains as close to schedule as possible. 2026 will also provide an opportunity for states to learn from each other’s proposals and to collaborate on strategizing and lessons learned as desired. It will also provide an opportunity to start identifying best practices to inform future planning. 

Other Changes to Medicaid under H.R. 1 

Beyond these provisions are significant changes to Medicaid funding, payments, eligibility, and coverage. States will be at the frontline of implementing some of those changes, including related to enrollment and redetermination timelines, eligibility standards and monitoring requirements, provider tax and state directed payment parameters, changes to eligibility standards for long-term care and home and community-based services, and new cost-sharing requirements.  

As we enter 2026, it will be incumbent on states to continue working on both the changes to state authorities (such as Medicaid State Plans and regulations) and operations (such as systems changes) necessary to implement these changes as we enter 2026 and on an ongoing basis over several years. 

Health-Related Social Needs

Following a steady stream of activity seeking to address Health-Related Social Needs (HRSNs) at the state and federal levels in previous years, we saw that – not surprisingly – slow down significantly following the federal administration change at the beginning of 2025. As HPN shared in March, the new administration retracted significant HRSN guidance, leaving questions about the impact on HRSN guidance broadly. While it has been quiet at the federal level, both in regards to guidance and decisions regarding pending HRSN Section 1115 Waivers since, states are continuing to determine how to move forward on these issues.  

Looking forward, recalibration at the state level will likely continue being the theme in 2026. HPN shared innovative approaches to advancing HRSN efforts solely at the state level from New Jersey last month. In the absence of opportunities through Medicaid waivers, states may increasing look to collaboratives and quality programs to promote these priorities.  

Private Insurance

Premium and Subsidy Changes and Section 1332 Waivers

This fall brought a razor focus on the Affordable Care Act Advance Premium Tax Credits (APTCs), as debate over renewing the “enhanced APTCs” (that were authorized through the American Rescue Plan Act and Inflation Reduction Act and are set to expire at the end of 2025) became the center of the federal government shutdown. Compounding the uncertainty of the enhanced APTCs were announcements of record high premium increases for 2026. 

Looking forward, though efforts continued into December in Congress, it is unlikely the enhanced APTCs will continue into 2026, though the baseline APTCs will remain in place. Notably the Exchange Open Enrollment Period ends in less than a month, meaning even if a last-ditch effort were to succeed, it is hard to know how many people would be aware of the change in time to make coverage decisions factoring in the enhanced APTCs.  

In the new year and beyond, the impact of the expected end to enhanced APTCs and the premium increases will play out, most directly as we measure the impact on coverage rates, market stability, and, as a result, likely further premium increases into future years. Indirectly, this will also impact state Section 1332 Waivers – both because of APTCs decreasing and coverage rates declining, states are likely to receive less “Pass-through Funding” tied to federal savings in APTC costs resulting from the waiver programs. In 2026 we will begin to see if states will rethink these waivers as a result.  

Federal and State Policy Changes

H.R. 1’s impact extends beyond Medicaid. In regards to healthcare, there were also provisions impacting private insurance, including related to eligibility for the ongoing APTCs, cost sharing, and plan levels. Also this summer the CMS released updated market rules related to standards for Qualified Health Plan (QHP) and Exchange and APTC eligibility and enrollment. However, portions of the rule remain in limbo as they are subject to legal challenge. 

As we enter 2026, all eyes are on the justice system to see how that challenge plays out and whether the challenged provisions will survive: 

• • A $5 monthly premium for individuals in fully-subsidized plans that do not apply for updated eligibility determinations.  

• • Allowing QHP carriers to deny coverage for individuals who previously failed to pay premiums.  

• • Allowing Exchanges to deny eligibility for APTCs for individuals that fail to file taxes.  

• • Imposing additional eligibility verification requirements.  

• • Expanding de minimis actuarial value (AV) ranges for QHP plan levels.  

While expectations are that there will be fewer changes at the federal level as planning begins for plan year 2027, that may hinge on the outcome of the case. 

Meanwhile, states are also likely to continue pursuing innovative options to strengthen their insurance markets. We have seen increased activity around provider network adequacy, which is likely to continue into 2026. Similarly, states continue to grapple with the right policy approach to prescription drug coverage. Increased focus is being paid to GLP-1s as possible drivers of increased premiums. On the other hand, an increasing number of states are looking at carrier prior authorization practices with a critical eye to ensure they are being used appropriately. States are also likely to consider what actions they can and will take to address rising premiums and what may be declining coverage rates.  

Behavioral Health Assessments

States continue to seek strategies for right-sizing capacity to address behavioral health needs. In 2025 PCG subject-matter experts hosted a webinar on behavioral health continuum assessments, what these assessments entail and how they can be used to build an understanding of and strategy for addressing mental health and substance use disorder needs within communities. Based on the assessments, states can more effectively allocate resources, tailor public health strategies, and enhance the overall quality of life for their residents by systematically evaluating the behavioral health needs of diverse populations.  

As we enter 2026, we can expect to see even more interest in actionable data to support ever-growing demands for behavioral health services. Given the high prevalence of increasingly complex mental health and substance use disorder treatment demand, states are grappling with ways to ensure access to care. To meet these gaps, states need coordinated, comprehensive state-level, cross agency planning. We will also be watching for the impact federal policy changes may have on access to behavioral health services.  

EMS The Future of EMS and Ambulance Care After a Pivotal 2025

As we reflect on the past year in the EMS world, a few key takeaways stand out. 2025 brought significant policy changes and financial challenges, but it also opened doors for innovation and collaboration. Agencies navigated rising costs and evolving Medicaid reimbursement rules while exploring new care models like Treatment in Place and mobile integrated health. Programs such as Medicaid Ambulance Supplemental Payment Program (ASPP) funds continued to provide critical support, and initiatives like the Rural Health Transformation Program created opportunities for workforce development and technology adoption.  

As we look ahead to 2026, EMS providers have a chance to build on these lessons, strengthen sustainability, and deliver care in ways that better meet the needs of every community. Click here to read more.  

PCG clinical and subject matter experts will continue to track and provide updates on all of these issues in the coming year!