Round ’em up. The Presidential priorities that have everything and nothing to do with each other.

This week has been a healthcare whirlwind. Here’s what I think you need to know

* Most favored nation policy is still kicking around and the company announcements are interesting, but I want to poke around under the hood to see the details.

* Tariffs at 100% are on pause.

* Government shutdown meant a flurry of releases from the Centers for Medicare & Medicaid Services (CMS). We got info on Medicare Advantage utilization management submission info, retail pharmacy network access info, translated model material info, Medicare Prescription Payment plan materials updates (use 2025 materials for now), PDE file layout updates, etc. – Biggest release was on Medicare negotiation for 2028.

* During shutdowns, the Food and Drug Administration can’t take in new user fees so if you have a drug you were about to hit submit on, please hold.

Caught My Eye

Batter Up. Pfizer made a splash this week by being the first pharmaceutical manufacturer to step forward with Most Favored Nation (MFN) pricing in Medicaid, direct to consumer purchasing via to-be-launched TrumpRx and a promise to price new product launches the same in the U.S. as elsewhere, among other concessions. In exchange, Pfizer does not face new section 232 tariffs for three years. More companies are expected to make announcements. I’ve seen press coverage that implies that all of Pfizer’s drugs are part of the Medicaid MFN, but there are ways to read the news releases from the White House and Pfizer and think that maybe it isn’t all? But that could be me looking for trouble.

He’s Not Here. Nothing (yet) on an MFN model from the Centers for Medicare & Medicaid Innovation (CMMI.) If I just jinxed this afternoon, I am really sorry.

Refresh. National Pharmaceutical Council released this brief on cell and gene therapy. Perfect if you’re new to the space or keep losing the thread and need to reset. And once you get caught up, read this JAMA piece on CMS Cell and Gene Therapy Access Model.

Bumpy Road Ahead. We know that millions are expected to lose Medicaid coverage over the next few years because of One Big Beautiful Bill, but what is the health of those that might not be able to meet the work requirements and may not meet an exemption. Research in JAMA suggests that over 40% of these individuals have 3 or more chronic conditions and over 10% were taking 5 or more prescriptions. The exact people you’d want to make sure have insurance.

Supply and Effect. NEJM article on the potential of tariffs to increase costs and reduce availability of generics.

Reviewing the Fundamentals – Affordable Care Act Subsidies

I covered this a few months ago but, given the government shutdown, I thought a tweak and repeat was warranted. What are these subsides that are thought to be worth closing the government for? Well open enrollment runs from November 1, 2025, to January 15, 2026. Beneficiaries must enroll by December 15, 2025, for their coverage to start on January 1, 2026. If these conversations get punted until November, will it be enough time to make it all work?

But let’s take a step back. The Affordable Care Act (ACA), often known as Obamacare, introduced significant reforms to the U.S. healthcare system, including mechanisms to make health insurance more affordable. A key component of this affordability were premium tax credits (PTCs) (subsidies).

Original ACA Premium Subsidies

When the ACA was enacted in 2010, PTCs to help individuals and families with lower and moderate incomes afford health insurance purchased through the Health Insurance Marketplaces.

• Eligibility: Originally, these subsidies were available to households with incomes between 100% and 400% of the Federal Poverty Level (FPL.)
• “Subsidy Cliff”: A significant feature of the original law was the “subsidy cliff.” If a household’s income exceeded 400% of the FPL by even a small amount, they would lose all eligibility for premium tax credits, potentially facing very high full-cost premiums.
• Cost-Sharing Reductions (CSRs): In addition to premium subsidies, the ACA also established CSRs for eligible individuals. These subsidies reduce out-of-pocket costs like deductibles, copayments, and co-insurance for those with incomes up to 250% of the FPL.

Expanded Subsidies (American Rescue Plan Act & Inflation Reduction Act — ARPA)

In response to the COVID-19 pandemic and economic challenges, Congress expanded the subsidies until the end of 2025. These expansions:

• Elimination of the “Subsidy Cliff”: The most significant change was the elimination of the 400% FPL income cap for subsidy eligibility. This meant that even individuals and families with incomes above 400% of the FPL could qualify for subsidies if their benchmark plan premiums would exceed a certain percentage of their income. This was crucial for middle-income individuals who were previously ineligible for any assistance.
• Increased Subsidy Amounts for All Eligible Individuals:
  • For those with incomes between 100% and 150% of the FPL, premiums for the benchmark silver plan were reduced to $0.
  • No one was required to pay more than 8.5% of their household income towards the premium of a benchmark silver plan, regardless of their income level.

These expanded subsidies DOUBLED enrollment in Marketplace Exchange plans to just over 24 million, making coverage significantly more affordable for millions of Americans, particularly those with lower and middle incomes.

Expiration of Expanded Subsidies in 2025

The enhanced premium tax credits provided by the ARPA and extended by the IRA are set to expire at the end of 2025.If they aren’t extended, the “subsidy cliff” will return and the maximum percentage of income that individuals are expected to contribute to benchmark plans will increase. If these expire, it is projected that nearly 4 million people would become uninsured. The Congressional Budget Office says that number increases to almost 6 million by 2034.

And this isn’t some small challenge for beneficiaries. Expiration of the enhanced subsidies is estimated to more than double what subsidized enrollees currently pay annually for premiums— a 114% increase from an average of $888 in 2025 to $1,904 in 2026.

For the Files

When you have a bit of time, do a deeper dive into this AEI report on how tariffs impact healthcare costs.