Healthcare Headlines from the Hill: October Edition

Stay ahead of the latest regulatory shifts and healthcare breaking news with Headlines from the Hill.

In this month’s edition you will find:

• Final Rule update for inpatient rehabilitation facilities.
• Prior Authorization / Medicare Advantage Reforms: 5 of the largest employers support legislation.
• Interstate Barriers to Care: Lifepoint Health founding coalition member.
  

Final Rule update for inpatient rehabilitation facilities.

The Centers for Medicare & Medicaid Services (CMS) announced a six-month period of enforcement discretion for the new initial interdisciplinary team (IDT) meeting requirement finalized in the FY 2027 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Final Rule.

Per the CMS notice, for IRF admissions occurring between October 1, 2026, and March 31, 2027, Medicare Administrative Contractors (MACs) will not deny or non-affirm a claim based solely on the timing of the initial IDT meeting, provided that IDT meetings occur at least once per week throughout the patient's stay. While the new four-day requirement technically remains in effect, CMS will apply the prior weekly meeting standard (in effect prior to FY 2027) for enforcement purposes during this six-month transition period. However, beginning with admissions on April 1, 2027, the four-day initial IDT meeting requirement will be enforced without this flexibility, absent an intervening policy change.

In its announcement, CMS specifically acknowledged stakeholder concerns regarding the limited time available for IRFs to adjust their processes ahead of the October 1 effective date. Lifepoint will continue working closely with CMS during the enforcement moratorium to press for more substantive changes to the IDT requirement, including reconsideration of the “Day Zero” concept that was referenced in the proposed rule and subsequently abandoned.

In sum, the announcement provides that:

• The six-month enforcement discretion applies to IRF admissions from October 1, 2026, through March 31, 2027.
• MACs will not deny or non-affirm claims solely because the initial IDT meeting occurred outside the new four-day timeframe, provided the prior weekly meeting standard is satisfied.
• The four-day requirement remains in effect, and all other applicable IRF coverage and documentation requirements continue to apply.

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Prior Authorization / Medicare Advantage Reforms: 5 of the largest employers support legislation.

Five of the nation’s largest employers—Amazon, Axon Enterprise, Google, Meta and Oracle—have pledged to support federal efforts to streamline prior authorization processes for self-funded employer-sponsored health plans.

The announcement, made by CMS and U.S. Department of Labor, builds on the administration’s broader initiative to modernize prior authorization, reduce administrative burdens and improve timely access to medically necessary care. The hospital federal and state trade associations applauded the commitment while emphasizing the urgent need for meaningful prior authorization reform across Medicaid managed care, Medicare Advantage and commercial health plans.

Besides federal legislation, state legislation is also expected to eliminate:

• Prior authorization requirements for physician-ordered post-acute care at discharge
• Establish 24-hour and 72-hour decision timelines for urgent and nonurgent requests
• Require timely same-specialty physician reviews of denials
• Strengthen insurer accountability through annual reporting requirements.

Lifepoint strongly supports Medicare Advantage Improvement Act (H.R. 8375/S. 4384) -- this bipartisan bill would reform Medicare Advantage prior authorization, claims denials and other plan practices. Neither version has advanced through committee.

The legislation is more likely to move as part of a broader Medicare Advantage accountability package or year-end health package than as a standalone bill and could be combined with other prior authorization proposals. While the employers’ voluntary commitment represents a positive step toward reducing administrative barriers, lasting reform requires enforceable standards that ensure patients receive timely care and hospitals can operate efficiently. Lifepoint will continue advocating for policies that reduce unnecessary delays, preserve hospital capacity and lower healthcare costs for our patients.

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Interstate Barriers to Care: Lifepoint Health founding coalition member.

As part of American Telemedicine Association (ATA) Action’s Cross-State Care Coalition, Lifepoint will be participating in the discussion, “Breaking Down Interstate Barriers to Care” with other health systems, provider organizations, innovators and virtual care leaders to develop and advance practical, bipartisan federal legislation that removes unnecessary barriers to cross-state care and expands patient access.

Founding members include Lifepoint Health, Johns Hopkins Medicine, Access TeleCare, AdventHealth, Clara, MedStar Health, The Ohio State University Wexner Medical Center, Sanford Health, Talkiatry, and Teladoc Health.

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