Stay ahead of the latest regulatory shifts and healthcare breaking news with Headlines from the Hill.
In this month’s edition you will find:
- Inpatient Rehabilitation Review Choice Demonstration set to expand in 2026.
- Inpatient Rehabilitation Facility Priority Issues: AHA committee meeting update.
- Rising healthcare costs: Senate Finance Committee Hearing on enhanced Advance Premium Tax Credits.
Inpatient Rehabilitation Review Choice Demonstration set to expand in 2026.
On December 1, CMS announced that it will be officially expanding the inpatient rehabilitation facility (IRF) Review Choice Demonstration (RCD) to both Texas and California in the first half of 2026.
When does the RCD expansion take effect?
For IRFs in Texas:
- RCD reviews officially begin on March 2, 2026.
- The Choice Selection period for Texas IRFs will run from January 15 – February 13, 2026.
For IRFs in California:
- RCD reviews officially begin on May 1, 2026.
- The Choice Selection period for California IRFs will run from March 16 – April 14, 2026.
All IRFs physically located in the two expansion states who also bill to Novitas Jurisdiction JH (for Texas) or Noridian Jurisdiction JE (for California) for Medicare claims will be subject to the RCD. If an IRF is located in either state but bills to another MAC or Jurisdiction (i.e., if your hospital is part of a larger system headquartered in another state with consolidated billing), you will not be subject to the RCD during this phase. Only Medicare FFS claims, not Medicare Advantage or other payers, will be included in RCD reviews.
In partnership with AMRPA, Lifepoint will continue to push back on this decision, particularly given the current affirmation rates and the recent letter from nearly every member of the House Texas Republican delegation last week calling for the demonstration’s termination. Lifepoint will continue to supply updates as this plan for expansion continues.
Learn more on how to prepare for RCD in your state.
Inpatient Rehabilitation Facility Priority Issues: AHA committee meeting update.
Russ Bailey, President - Rehabilitation Services at Lifepoint Health and the American Hospital Association (AHA) Post-acute Care Steering Committee met with Rachel Dolin, House Ways and Means Committee Minority Staff to discuss issues impacting for post-acute care providers and the following AHA committee priority issues:
- IRF Review Choice Demonstration – Continue to work on preventing further expansion of demo and encourage early termination in existing states.
- Medicare Advantage: Prior Authorizations & Network Adequacy -- Ensure proper access for MA beneficiaries by stopping use of inappropriate criteria and other behavior that delays and denies access to post-acute care.
- Medicare Market Basket -- Improve annual payment updates to better reflect increasing cost of care.
- Home Health PPS Payment Reductions -- Limit budget neutrality cuts due to PDGM implementation
- Medicare Post-Acute Transfer Rules -- Prevent changes in payment policy that will disincentive.
- Outpatient Therapy -- Ensure access to intensive outpatient therapy for both Fee-for-Service and MA beneficiaries.
- Medicare Star Ratings for IRF -- Discourage development by demonstrating lack of utility, lack of credibility of singular star system due to post-acute care facility characteristics.
- SNF Oversight -- Reduce reliance on Special Focus Facility program.
- Post-acute Care Value-based Purchasing Programs (HH, SNF) -- Advocate for programs to pay out highest possible percentage of withhold and uses equitable methodology.
Rising healthcare costs: Senate Finance Committee Hearing on enhanced Advance Premium Tax Credits.
The Senate Finance Committee held a hearing titled, “The Rising Cost of Health Care: Considering Meaningful Solutions for All Americans.” Testifying before the committee were Douglas Holtz-Eakin, President, American Action Forum; Jason Levitis, Senior Fellow, Health Policy Division, Urban Institute; Brian Blase, President, Paragon Health Institute; and Bartley Armitage, Advocate.
The discussion focused on the expiration of enhanced Advance Premium Tax Credits (eAPTCs) and potential reforms or alternative solutions.
- Chairman Mike Crapo (R-ID) highlighted bipartisan consensus on the realities of rising premiums and out-of-pocket healthcare costs for Americans. He warned that the Affordable Care Act (ACA) and temporary eAPTCs mask price increases and exacerbate fraud, arguing that extensions would not solve underlying problems.
- Chairman Crapo called for solutions, including directing aid through Health Savings Accounts (HSAs), expanding tax deductions, funding cost-sharing reduction (CSR) subsidies, investing in innovation and reintroducing pharmacy benefit manager (PBM) reform to lower drug costs.
- Ranking Member Ron Wyden (D-OR) countered that funding cuts and perpetuating insurance company abuses have increased costs for Americans. He noted the upcoming end of open enrollment and called for a clear extension to tax credits, warning that Congress will be unable to devise a plan by the end of the year.
- Ranking Member Wyden also urged cracking down on PBMs and fraud to protect consumers from abusive insurance brokers.
The committee will continue to consider potential reforms or alternative solutions to the eAPTCs. The Senate is expected to vote on how to address eAPTCs by mid-December.
