Podcast - Recent Federal Developments in Healthcare Transparency

Morgan Ribeiro: Welcome to Counsel That Cares. This is Morgan Ribeiro, the host of the podcast and a director in the firm's healthcare practice.

Since early 2025, with the Trump Administration taking office, there has been an extensive push for healthcare fraud, waste and abuse. Just a lot of eyeballs on the healthcare industry, where there could be improvement for patient care, for pricing, for quality, transparency. Along with all of these efforts, today we're going to specifically focus on healthcare transparency, and this movement is building momentum really with a desire to give patients, employers, payers, regulators, policymakers, all of these stakeholders greater visibility into areas that have historically been rather opaque. We're looking at, as I said earlier, we had a pricing quality and even ownership and control of healthcare organizations. It feels like we've really reached this point where the scrutiny is quite frankly pretty high, and I think there's few things that really get bipartisan support like this topic.

So today we're really going to focus on three areas. One being transparency around ownership structures, particularly private equity and corporate owners. The second being the current agenda in Congress to ensure that nonprofit hospitals have really verified their tax-exempt status. There's a lot of money on the line there. And third, the anticipated uptick in congressional investigations that target these healthcare organizations.

So for this conversation, I have gathered three of my Holland & Knight colleagues who focus their time working with clients on issues related to healthcare transparency. Jordan Brossi is a policy advisor in the firm's Washington, D.C., office, Chris Armstrong is a partner in the D.C. office and John Saran is a partner in our Chicago office.

Before we jump into the meat of this conversation, I want to welcome my guests and allow them to introduce themselves. And first, Jordan and Chris and John, welcome to the show.

Jordan Brossi: I can kick us off. Jordan Brossi, senior public affairs advisor in our Washington, D.C., office within the federal affairs group. I focus on healthcare and life sciences. Really looking forward to the conversation today.

Morgan Ribeiro: Thanks Jordan. Chris?

Christopher Armstrong: I'm Chris Armstrong. I'm a partner in the Washington office as well. I co-lead our team that's focused on investigations by Congress. It's been about 12 years on the Hill running investigations, often into tax and healthcare. So, [I'm] excited to be here today.

Morgan Ribeiro: Thanks Chris. And John?

John Saran: Yeah. Thanks Morgan. I'm a Healthcare Transactions partner based in Chicago. I pretty much do everything in healthcare, so I work with operators, private equity firms, lenders and everyone looking to invest, lend into, operate, et cetera, in the healthcare industry. More recently, focused on the federal and state scrutiny of healthcare consolidation. I was a part of some of the first few transactions that went through state review and have followed the developments very closely. We spoke with regulators, spoke with associations and really been a part of these trends over the last few years.

Morgan Ribeiro: Awesome. Well, wonderful. I look forward to everyone sharing your perspective on this conversation. I first want to start with a big picture to better understand how you define the current temperature in D.C. as it relates to healthcare and the need for regulation and legislation, addressing ownership, pricing, quality and other efforts around transparency. So Jordan, I'll kick that to you.

Jordan Brossi: Thanks Morgan. To kind of start us out on the temperature and what's happening in Congress, I think it's really important to keep in mind that timing is really of the essence here. Next week, the House and the Senate are going to return. They've been out for the July 4th holiday. But next week could be the very last week if there's any congressional activity happening, at least for the House, until September. The temperature in D.C. has not only been over 100 degrees for the past couple of days and has recently just cooled off, but the election season is really what's going to be heating up, and that leaves a really limited number of legislative days for comprehensive action, particularly on healthcare legislation.

All of that being said, transparency, particularly as it relates to hospitals, is front and center right now, as well as the linkage between how additional transparency could improve healthcare affordability. That continues to be another factor that Congress is very focused on. We just saw a House Committee on Energy and Commerce Subcommittee on Health markup that featured those areas of focus within Congress on transparency, particularly as it relates to ownership and pricing disclosures, which I know we'll get into more of the substance on here shortly. But these themes are really consistent across the chambers.

There's similar interest in transparency within the Senate with Republicans, including Senate Health, Education, Labor and Pensions Chairman Bill Cassidy as well as Senator Marshall, who could be a potential person to take over from Senator Cassidy. This is really shared not only between the chambers, but also, again, between the parties. This is a significant area of common interest. With the election again being on the horizon, this could be something that's pushed until later this year, but the committee's action is certainly going to continue, whether it's next week before they leave or upon their returns in September right before the election. I imagine we'll see a resurgence of focus on healthcare and transparency and an advancement of the policies that they want to see moving before the end of this year.

Morgan Ribeiro: Great. Thanks for that. And Chris? Any other thoughts you have just in terms of the overall temperature that seems to be rising both literally and figuratively in D.C., but particularly around this topic.

Christopher Armstrong: I think that's exactly right. I think the temperature here is high, except I'd like to just comment on how. As I look at oversight investigations, there's often like two ends of a spectrum. On one end, it is extremely hot, extremely timely. It's the topic of the day. On the other end is a slow burn, issues that aren't actually going away. It's not the news of the day, although it has interest in both houses and on both sides of the aisle. I think that's where we are right now. I think that adds a lot of risk. I think one thing that Congress for the past years has learned – I think the next one will learn – is that legislating is hard. It takes a lot of time. Oversight, it's easy. It's easy to launch a letter. It's easier to hold a hearing. So that's where I'm looking, and that's what I'm expecting much more activity as well.

Morgan Ribeiro: That's really helpful. John, what about you? The federal component is one thing, but as you mentioned earlier, it's, where we've seen the most activity and where it's easy to get some traction is at the state level.

John Saran: Right. And I think we'll talk a little bit about specific federal laws. I mean, the general result in this space is that the federal bills didn't go anywhere. But we'll talk about some more recent developments there. And I think there was a shift in 2024 when some states had started to think about healthcare consolidation and how they regulate it. But 2024 was a really bad year for getting those laws passed. Then you had the national election, administration change and with that, the change in leadership in the FTC. And going into that, there was this perception that private equity was in the crosshairs. Private equity was sort of scrutinized for their involvement in the healthcare industry. But then when that change happened, that scrutiny had just broadened generally to the healthcare industry. It wasn't necessarily, and if you just look at the remarks of the new FTC chairman, it's more of looking for general antitrust issues across the board and all stakeholders, not private equity specifically. And so given that shift, there was a sense by the states that, OK, well, maybe there may not be a focus on private equity or corporate practice medicine or these things at the federal level. And so maybe we need to now take some of the rubrics that were put out in those proposed federal bills and then start proposing state laws. And so 2025, we saw something like 30 bills proposed across several different states. I would say about eight or so were successful, many were not.

And then you fast forward to this year. And sort of the after effect, right, of sort of a second year of that result. And you know, we're pretty much at the end of the state legislative season, and it was a really bad year for getting these laws passed. There were only about five states that got laws passed. If you look at new states on the board, very few. I know we're waiting for Illinois' governor here to sign updates to their existing bill. But there were many more bills that failed to move forward. And I can imagine that, right, if you've tried multiple years in a row, expended resources, time, effort, at some point, it may end.

And actually, one development came up, and I know we've got an amazing DSO team here, dental support organization team here that works with the dental industry. North Carolina, which historically has been one of the greatest, I would say, state for scrutiny of healthcare transactions in the dental space, they actually just changed their law to no longer review management arrangements between DSOs and dental practices. And so that's almost like a reversal of some of these trends that we're seeing. So it's just very interesting if we look at the last few years.

Morgan Ribeiro: Great. Thank you for that. And I want to piggyback on something that you just said, John. You know, while the feds have not been very active or very focused on, I think they've been focused on the oversight of ownership and healthcare, but not really able to get much done. We have seen an uptick in activity, even just over the last few weeks, that may shift that. Congress is currently advancing a pretty major legislative push, and it's headlined by the Lower Costs, More Transparency Act, which is H.R. 9393. And this was introduced by Representatives Brett Guthrie and Frank Pallone. This sweeping package is moving through multiple committees right now, including Energy and Commerce, Ways and Means, and Education and the Workforce. Jordan, can you tell us more about this bill and others that demonstrate to us that Congress is focused on this topic of ownership again.

Jordan Brossi: Yes. Thank you, Morgan. As I mentioned, one of the more recent markups that have been held in a committee of jurisdiction that oversees Medicare-specific [issues] to Energy and Commerce, Medicaid and other parts of the federal healthcare system, the Energy and Commerce Committee's Subcommittee on Health held a markup at the end of June, which featured a mix of different healthcare bills that were really focused on transparency and affordability. As you called out, the major package the committee is pursuing is the Lower Costs, More Transparency Act of 2026. As some of our listeners might recall, the House had previously passed the Lower Cost, More Transparency Act of 2023, which featured new transparency requirements across a lot of the healthcare sector, touching on hospitals, insurers, providers, but that bill didn't make it anywhere into the Senate. So this is a revisit and kind of improvement upon a really long-term bipartisan effort. While some transparency requirements and other reforms to different parts of the healthcare system did make it across the finish line separately in February and have now been signed into law as part of a larger spending package, Congress is now refocusing its attention on this same transparency bill that had so much bipartisan support across not only the Energy and Commerce Committee but also what we refer to as the tri-committees, including Ways and Means and Education and Workforce in the House.

So a couple major provisions that are in the Lower Costs, More Transparency Act, again, they touch on transparency across all different parts of the healthcare ecosystem, including expanded price disclosure requirements for hospitals. Hospitals under this proposal would be required to publicly post standard charges for each item and service in a consumer-friendly manner, using plain language descriptions of items and services, gross charges versus discounted cash price, payer-negotiated charges and names of associated third-party payers. This would extend to clinical diagnostic lab tests, imaging tests, ambulatory surgical centers, pharmacy benefit managers. All of those pieces are touched upon by this legislation. There would also be some enhanced compliance and enforcement authorities for the Department of Health and Human Services, including sticks in the form of potential civil monetary penalties. And the lists of hospitals that aren't in compliance, should this bill be enacted, would be made public by HHS. So there's significant accountability across all of those linkages. There's also self-service tools because a lot of the focus on this bill comes from the need for transparency to arm consumers with the information they need to make informed choices about their health services, compare, and also have transparency be a way to lower costs. This bill, coming out of the committee, was agreed to by a voice vote, specifically the subcommittee, excuse me, and it has strong bipartisan support, seeing as every member of the community agreed to move it forward.

Now, one interesting discussion point I would be remiss not to highlight that came up during that committee activity was discussion around a bill that would make changes to healthcare ownership policies, specifically. Ranking member of the Subcommittee on Health Congresswoman Diana DeGette, Democrat from Colorado, she offered an amendment that would have added to the Lower Costs, More Transparency Act certain ownership disclosure requirements. Now her amendment is based off of a bill that had been previously introduced by two bipartisan members of Congress, including Congresswoman Jan Schakowsky, Democrat of Illinois, and Congressman Gus Bilirakis, Republican from Florida. So this is really, again, notable because it's a bipartisan policy being put forward for consideration. The specific ownership disclosure requirements are really wide-ranging, and I just want to touch on some of the provisions now. It would make mandatory the reporting of information related to healthcare ownership for a variety of different healthcare entities, position-owned practices with more than 25 physicians for one year, physician practices owned by hospitals, health plans, private equity companies or venture capital firms, ambulatory surgical centers, independent freestanding emergency department centers. So touching on again, more facilities than just freestanding hospitals. The data that would be required to be reported includes data on mergers, acquisitions, changes in ownership that happened in the previous year, names, addresses, business structure, and what's really notable as well is any other information with respect to ownership that could be determined by the secretaries. So that opens up a really wide range of information that could be pulled on.

Now, there's significant discussion that happened on the amendment, including comments, which again, I'm using the word notable a lot here because there's a significant bipartisan agreement. You had Republican members who not only agreed to continue working on the bill as it moves towards potentially being included in another full committee markup, which would be the next step in the process, but also you had a Republican member on the committee who said this is something that needs to be done. Now that's something really significant and really finite that entities should monitor really closely. Now I view it really likely, whether it's later this month before they leave or in September when they return, that this will come back up, and I imagine it will be a push to ultimately include this as part of the larger package.

One other bill that's worth noting that I know we'll discuss as we get into tax-exempt hospitals. Yes, John.

John Saran: Yeah. Just before you get there, I mean, if something like that were to be passed, it would be significant, right? I mean I just mentioned, right, states have struggled to pass these transaction bills, these ownership disclosure bills. I mean, generally it is concentrated on the coasts. I'm not surprised, right, Pacific Coast, New England, there's a few Midwestern states, but some of that's even more limited. If something is passed on the federal level, these concepts that we're talking about would be across the board, and it's not just ownership, which if you're in Medicare or Medicaid you're used to doing normally, but mergers and changes of ownership. Maybe it won't necessarily bog down transactions with review periods prior, but you still will have to talk about all of these things in these submissions. It could be public and who knows, maybe they could ask for things like financial statements, right, almost turning it into like a mini public company. So this would be significant with like a federal override to do something that states have really struggled to do over the last few years.

Jordan Brossi: One other bill that I want to note, just given attention in committee of jurisdiction through the Ways and Means Committee, is the Tax-Exempt Hospital Transparency Act, which is H.R. 9504, which would require hospitals to submit certain information every year as part of their tax filing process. Now, I find this bill notable in comparison. You have the previous bill in Energy and Commerce that's focused on transparency of ownership changes, etc., various applications to health plans, but this is going after the long-standing nonprofit status for hospitals, which has been a major focus of the committee, particularly in Ways and Means given their jurisdiction over the ax code to ensure that entities that do have a 501(c)(3), etc., designation are actually meeting their need. Now a couple notable requirements just to flag as part of this bill would place specific requirements on hospitals depending on a certain threshold of revenue that they generate or a certain number of beds that they have. The legislation is also an effort to pursue transparency through the 340B Drug Pricing Program, which has again been another really key area of focus for both Republican and Democratic members in both chambers. I'll come back to the additional provisions on that bill later, but I did just want to highlight that bill to underscore another bill that's moving forward and has already been advanced by the Ways and Means Committee, meaning it's kind of full steam ahead. So with that, I'll pause.

Morgan Ribeiro: Well done, Jordan. There's a lot of activity there that you just summarized, and we will be watching closely to see sort of how these things evolve over the next couple of months. As we've noted here, you know, the federal level has been pretty quiet over the last few months, but, and the last couple of years, and therefore the states have been busy enacting laws or attempting to enact laws that increase the oversight of mergers, acquisitions and restructuring in the healthcare sector. And a lot of these laws, at least on the surface, are aimed at protecting community access, reducing costs and regulating the influence of private equity and management companies.

So John, you've been very focused on tracking this over the last couple of years. As you noted earlier, last year, most of these efforts were not successful. But just curious to get from your perspective, you know, key trends as you're seeing this in state legislatures and the bills that have been passed over the last 12 to 24 months.

John Saran: Yeah. Thanks Morgan. I mean, I think one thing we saw in 2025 and now we're seeing in 2026, is that states are starting to think of, it's not, you know, broader than just, OK, maybe one particular stakeholder in the industry, or maybe we're just going to focus on transaction reporting. I mean, if you look at the state bills that were introduced in the last two years, it has been the full spectrum of different ways to regulate, scrutinize and learn about healthcare consolidation. And that can come in the form of transaction reporting, ownership disclosures, corporate practice of medicine restrictions, right? If you can study and sort of put parameters on the way transactions are structured. Noncompete restrictions, I know there was a discussion on the federal level. States kind of took that back with some of these proposals, you know, putting restrictions in place. And even we saw moratoriums, at least in one state or so. And these states, and what you found in each of the states for the proposals, was a highly tailored application of those concepts. So if one state maybe suffered a large system health failure, they would propose a bill that would essentially try to stop that from happening again. And that would maybe be one or two elements of those that I just described.

There's been a recent trend of looking at real estate investment trusts and sale of lease-back transactions and how corporate entities engage with nonprofits and hospitals on that front. But I think the states that were able to get bills passed ultimately, they usually look a lot different from what they started out to be, especially if they were meant to sort of address some of these, you know, let's say, bad results in their states. But like I said, we're kind of winding down this year, and I think it's getting harder and harder for states to pass these measures. You're seeing greater participation in the market, in the industry, people are speaking up. And if you look at the bills that were passed this year, in some cases, the states had taken almost three years to get something over the line, and it was maybe about 30 percent of what initially was proposed.

Morgan Ribeiro: Great. Thanks John. I mean, I think we'll continue to see that until we, you know, see what's happening at the federal level too.

So Chris, I want to turn it over to you. Your focus, as you mentioned earlier, represents healthcare clients in congressional investigations and hearings. For the remainder of this congressional session and into the next, with Democrats could potentially gain control of one or both chambers, the healthcare industry should expect heightened congressional investigations across a broad set of issues. And regardless of these outcomes, the sector will remain a consistent target of oversight driven largely by affordability concerns that span across a number of different stakeholders, insurers, providers, manufacturers, intermediaries, and they're likely to shape investigative priorities in both parties. So I want to hear from you. I know we've done some reporting on our end. What do you see as the areas that are most likely to draw investigative focus along with specific lines of inquiry?

Christopher Armstrong: Sure. On a macro level, all of the above, right? I think we tend to focus a lot on investigations that are more about politics or the topic of the day. This as a topic is a constant, right? You know, in the current Congress, you know, we saw oversight of PBMs, we saw oversight about a lot of healthcare issues. If you look after the midterms, you know, it's not going away at the same time.

In terms of the specific lines of inquiry, I would look at prices — if that's hospitals, if that's insurers, if that's drug makers or others. I think pricing is always going to be a topic. A topic I'm watching as well is compliance with existing law, especially for price. Medical billing is a top issue as well. Consolidation, private equity is of interest, as is the use of AI. All those topics are, you know, I talk to a lot of oversight members on the Hill and, you know, all these are the topics that are popping up over and over again. So that's why we're expecting a lot of activity on all of the above.

Jordan Brossi: And Chris, if I can just join in there, I think particularly if you look at what could happen if there's a Democratic majority in, let's just take the House based on historical patterns. The chamber, the lower chamber typically flips in the midterms against the president's party because it's the time where voters can go and give an assessment of how the current president is doing by voting for or against a sitting member. So let's just assume if history serves that the House will become a Democratic majority. A lot of the lines of focus and kind of road map, if you will, for Democratic members who are currently ranking members on committees of jurisdiction, a lot of those members have already started to lay out where they want to go. You've seen Congressman Robert Garcia, Democrat from California, lay out a specific and entirely healthcare-focused report from his staff on where he might seek to go related to vaccines, etc. The same can be said for other committees that have put out reports. We just saw one that was published by Democratic leaders on maternal healthcare and the impact on maternity care in the United States. So a lot of those efforts are already laid out in reports. So I think they have a very clear idea of within pricing, etc., that they want to go with specific policies they'll focus on, too.

Christopher Armstrong: Exactly right.

Morgan Ribeiro: All right. So now onto the debate around tax-exempt hospitals, which Jordan noted earlier. Tax exemption from hospitals is not a new topic inside healthcare. In fact, we've seen this sort of bubble up in Washington over the last couple of years. None of those sorts of discussions have gotten legs and really gone anywhere, but lately they've drawn outside attention from regulators and the media, who seem to be asking, "Do these not-for-profit hospitals actually deserve their tax breaks?" Like I said earlier, there's a lot of money on the line here, too, and I think some of that is around what these hospitals are actually making and are they actually putting out their community benefit reports and demonstrating that the tax exemption is warranted. So Jordan, what can you tell us about the bills that are being discussed around this topic?

Jordan Brossi: Yes. Of course. And I do want to bring us back to the kind of Tax-Exempt Hospital Transparency Act, which I mentioned earlier, is a key bill to watch given the progress that's been made through committee. But I do want to share just a bit more about the nitty-gritty provisions of the legislation to showcase just how impactful it might be. So a couple key provisions, as I mentioned, a tax-exempt hospital would be required to file under the bill. Certain information is part of its process of filing its tax returns every year, specifically under Section 6033 of the Internal Revenue Code. Now there would be different requirements for hospitals of a certain size, a certain patient revenue that's generated. But a couple items that every hospital that's tax-exempt would have to file would include a description of the organization and how it's addressing needs that have been identified in a recent community health assessment. And if something isn't being met, why [inaudible] audited financial statements, the value of financial assistance they're providing to consumers. Essentially to your point, Morgan, how are you serving your community in line with your tax-exempt status and kind of why do you deserve to keep it? For large tax-exempt hospitals, which in the bill are defined as those with more than 100 staffed inpatient beds, not including critical access hospitals or rural emergency hospitals, those facilities and entities would be required to report additional details for each of their hospital facilities operated by the organization, including three priority health needs: amount of spending, amount spent on quality improvement or non-clinical programming, or again, there's a bit of a deference to the agency, such community benefits as the secretary may prescribe.

For high-revenue tax-exempt hospital organizations, which is defined as those with net patient revenue of more than $100 million, again, not to include critical access to hospitals or rural emergency hospitals, those hospitals, under that definition, would be required to report on advertising information, specific and specified health service line information for covered entities, again, bringing it back to 340B, the, quote, "specific" federal 340B drug discount program information, including number of individuals, insurance type, the drugs dispensed or administered through covered outpatient drugs in a taxable year. There's reporting requirements, there's a GAO, Government Accountability Office report, that would be required, which, much like what we saw through the Energy and Commerce Committee discussion on ownership disclosure, a lot of this appears to be table setting for potential future action moving forward, which is something that I, again, think is what makes this bill the most noteworthy.

Now, before I turn it back to you, Morgan, I do think it's also important to highlight again that there's bipartisan interest, at least looking at disclosure information, not so much on this particular Ways and Means bill, which some Democrats in committee raised concerns with. But again, a lot of the Republican perspective and view on this issue is that transparency is a way you can reduce prices. Whereas on the flip side, Democrats think that you can't do transparency within a silo. You need to pair or follow it up with additional comprehensive action to lower the cost of healthcare, that transparency alone, essentially, is not going to solve it. Now, all of that being said about this particular tax-exempt reporting bill, Congress is paying attention to all parts of the supply chain and healthcare ecosystem. So that in mind, I do think keeping that difference in maybe thinking between the two parties is really important, as these items move forward, for stakeholders to keep in mind.

Morgan Ribeiro: Thanks Jordan. Chris, anything that you want to weigh in on that? I know you've definitely been eyeing this issue for some time now in conjunction with other colleagues across the firm. Just anything in terms of tax exemption, obviously there was a hearing at the end of April that featured hospital CEOs, not just tax-exempt hospitals, but I think that was certainly a focus of those discussions.

Christopher Armstrong: Yeah. That was a very interesting hearing in part because the arguments between Republicans and Democrats were in large part not about the underlying issue, except about a process, about the tax bill, about kind of other things. And so it showed me that, as a topic, it has pretty broad support. And I just want to echo, you know, this is not a new issue. So I first worked on the Senate Finance Committee, which was 19 years ago — which is a weird thing to verbalize, 19 years ago, it was a long time — and this was already an issue. At the time, we launched inquiries of, I don't know, a couple dozen hospitals asking about exactly this issue. And so it's been around that long, if not longer, and the same thing when I worked on Ways and Means. I think what's changed now is, you know, at the time it was politically extremely hard because there's a hospital in every district. It has a lot of jobs. It was a very hard issue to attack, and it seems like that's evolved in a way that's at least entirely new to me in the past couple of years, and so that's why I think this is such an issue worth watching.

Morgan Ribeiro: Perfect. All right. So I want everyone to get their crystal ball out. I know that you've mentioned a little bit about this already in terms of what the next couple of months look like, but how does this play out? Does it really happen this time? Whether or not that's the push towards transparency or doing something around tax-exempt hospitals. I'll kind of go to each of you individually and want to get your thoughts on this. And then, John, from your perspective, you've obviously been tracking the states really closely. Will we continue to see that momentum in the next legislative sessions? Jordan, I'll start with you.

Jordan Brossi: Yeah. Thank you. The Lower Costs, More Transparency Act, again, I'm going back to 2023, took a number of years to pass just the House and have certain parts of the reform signed into law. So I don't think, as Chris just said, none of these focuses are going to go anywhere. I think it's going to remain at the top of Congress' list. While there is a bit of trepidation based on how contested this upcoming election is going to be, I think that might be one of the major impediments, because I think there's a sentiment that members don't want to necessarily support something that will help the other side. That's kind of the lens that they're thinking through. So while it might not be, you know, next week, I think it will happen in the kind of months that we have ahead. And just given that divergence in Congress, I do think it's also important to think about the federal regulators, because where Congress might be constrained and maybe a little bit unable to act in certain realms, federal agencies like CMS are absolutely not. Those regulators are going to stay in their positions, either until the president asks them to leave or when they choose to do so on their own accord. In the interim, they're going to lean on absolutely every regulatory lever they can to spur changes, again, where Congress might not be able to.

Just two quick examples of where that's already playing out. Just as of last week, the CMS released the proposed Hospital Outpatient Prospective Payment System rule, which again governs payment and policies for a lot of hospital outpatients and other facilities, but there's a couple major changes in this proposed rule that are really significant, one of them being an expansion of site-neutral policies to include certain imaging services without contrast. In the proposed rule, CMS proposes to pay the equivalent of a specific rate for imaging services that are completed in off-campus hospital departments. With that change, CMS estimates Medicare Part B could save up to $260 million in the first year alone. Now, site-neutral policies are something that's been considered by Congress as part of the affordability agenda, but has not advanced due to some disagreement and pushback, so that's a good example of where CMS as a federal agency is moving forward where Congress is not. Another example just really quickly is on CMS, including in that same proposed rule, requests for information on how to better standardize and improve hospital price transparency data. So again, I find it really important that where Congress is not able to act, it's so critical to always monitor the federal agencies because they will move forward in absence of Congress doing so.

Morgan Ribeiro: Very helpful. Chris, what about you?

Christopher Armstrong: Yeah, so my crystal ball is not great at legislation, although, you know, if I have to place a bet, it's always on Congress not being able to act. So I'm going to start there. I think the one thing I see, though, is that hearings and letters are the part Congress is actually very good at. So that's what I'm expecting in my crystal ball.

Morgan Ribeiro: Excellent. And John?

John Saran: Yeah. So I mentioned this year was not a great year for states. You had probably over a dozen state bills that stalled. I could see some of those coming back or being reintroduced, maybe with some items cut or compromises made. So we'll kind of see there. I don't know how many new states will come on board, maybe one or two, but I expect to see the same type of process play out.

I think, though, states that have laws on the books with new regulations, and there's, like Massachusetts just finalized their regulations for their laws. California is trying to finalize their regulations for their law this year. Colorado just put out new regulations for the dental side. I could see implementation and scrutiny from that happening. We're already seeing it in Oregon and California. In Oregon, we did not have a government enforcement action, but we had a private right of action under their corporate practice of medicine bill. We'll see sort of what happens with Oregon next. California, in the last six weeks or so, we have seen two large settlements with the California attorney general, focusing on advertising, corporate practice of medicine and other related issues. And, you know, given midterms, given it's a state election year there, given that there were two settlements within a very short period of time, I could see continued enforcement. And for both Oregon and California, those enforcement matters are just a recognition. Those bills are real. The time for sticking your head in the sand and just hoping that the storm passes is over. You need to get your arrangements sorted out and you need to have good documentation because we're now, you know, we're seeing actual enforcement by state enforcement bodies and then also, you know, commercial parties where there are private rights of action.

Morgan Ribeiro: And John, you just sort of touched on something that I wanted to have a sort of a closing conversation here, which is on the practical side of this, right? I'm a healthcare organization, I'm an executive or I'm an investor in a number of different healthcare platforms. What do I do right now? From a practical standpoint, I mean, you mentioned obviously getting your house in order and being prepared for more of these reporting laws. I know we've certainly had discussions in the past, too, about just being proactive in your communication and telling your story and whether or not that's with just generally with your community or, you know, if you look at being a tax-exempt hospital, your community benefit report and sharing that widely and loudly. But curious to hear from all of you on what do you do in this current environment where the temperature is rising?

John Saran: I'm happy just to kind of give a brief. So work with your lawyers to make sure all of your legal documents are up to date and comply with the statutes. You don't want any easy foot faults. Second, have, as you mentioned, the practical side of it, where, just using corporate practices as an example, if you're supposed to have all the clinical decisions housed within and be made by the clinicians, that's great, it can't be a text message, right? You need to have actual documentation, actual records of these, you know, decisions being made so that when you do get scrutinized, you're able to actually provide the documentation and show that evidence that you do in fact, you know, comply with the overarching frameworks.

And honestly, one thing you mentioned is tell your story. There's still to this day a lot of one-sided narratives out there. I mean, I just saw a report recently that said, you know, take a look at all the private equity-backed joint ventures with hospitals and health systems. And my reaction is like, so what? They need capital too, right? And there were some case studies mentioned in that report. But, you know, I would encourage those organizations that were highlighted to kind of share their side of the story and others to do the same because otherwise what you get is just one narrative in a vacuum.

Morgan Ribeiro: Jordan or Chris, anything else to add to that?

Jordan Brossi: I can go next. I can't emphasize this enough. And Morgan has heard me say this before. So for her sake, I'm sorry to repeat myself. But one thing that I think healthcare leaders and their organizations should do is keep in mind the fact that regardless of how Congress looks next year after the election, there's more than 60 members that are not coming back, either because they wanted to run for a higher office, or they decided not to run for another election to represent the same seat. That means really significant opportunities to introduce yourself to new members who are going to be representing you in Congress, and that's really key, because you don't want the first time that you have to reach out to or be in touch with your representatives to be because you received a request for information from a committee or a subpoena, which is the worst outcome. You want to have that relationship, not only so you can call upon them should you need things from the office, which could be as simple as, "Hey, I'm having an issue with CMS reimbursing a particular claim or other process that's in place with HHS." Those can be really helpful with those matters, but also to talk about things that you support and maybe talk about the things you don't support for the tax-exempt hospital bill that I've mentioned and talked through. You know, if there are issues that you see with it or a reason why you don't think someone should support it, you should reach out to them and share your story, whether it's the benefits you're bringing to your community through programs that you offer, it is charity care, etc. You really want to have those relationships with members, regardless of if they're new or they're coming back, to make sure that you have the connection to call upon should you need to do so. So that's one thing I would recommend everyone consider. And certainly, as Chris has highlighted, we have lots of folks that can do that and know these people and can help make those introductions and foster those strong relationships.

Morgan Ribeiro: Great. Chris, anything else to add to that?

Christopher Armstrong: I think Jordan and John have it exactly right. And to emphasize the point of, I think right now is the time to understand your risks and what's out there and not waiting on a bill to pass. We're not waiting for a new investigation. Instead, doing those risks right now and examining about how to handle them if and when they arise.

Morgan Ribeiro: Awesome. Well, thank you so much for this conversation. I imagine we'll be huddling again here soon as we keep an eye on all of the bills that are out there, all of conversations that are happening across regulatory bodies and Congress. So as always, [I] appreciate the conversation and discussion with each of you.