Holland & Knight Health Dose: July 21, 2026

Looking Ahead

With the August 2026 recess looming, U.S. Congress faces a shrinking legislative runway to advance fiscal year (FY) 2027 appropriations bills and a growing list of healthcare priorities. Though the U.S. House of Representatives has advanced all 12 appropriations bills from the House Committee on Appropriations and House leadership has shared the text for a continuing resolution (CR) through early December 2026, U.S. Senate appropriators are still in discussions over topline funding and preparing various subcommittee bills for consideration.

Healthcare committees of jurisdiction – including the House Committee on Energy and Commerce – will be active this week, with a markup of 29 bills that will include the Lower Costs, More Transparency Act and others related to healthcare price transparency, illicit substances and Medicare Advantage. In addition, on the House floor this week will be several healthcare bills advanced by committees, including the U.S. Food and Drug Administration (FDA) Modernization Act 3.0 (H.R. 2821), the Nucleic Acid Standards for Biosecurity Act (H.R. 3029) and several other public health reauthorization bills. The Senate Committee on Health, Education, Labor and Pensions (HELP) will hold a markup of legislation related to labeling requirements for prescription drugs, as well as legislation to reauthorize certain healthcare workforce programs.

Upcoming Events

Congress

July 20, 2026

• House Committee on Energy and Commerce – a markup of 29 bills, including legislation related to illicit drugs, healthcare price transparency and access to biosimilars
• Senate Committee on Appropriations – a hearing on President Donald Trump's supplement funding request

July 21, 2026

• Senate Committee on Commerce, Science, and Transportation Subcommittee on Science, Manufacturing, and Competitiveness – Measuring What Matters: Science, Standards, and Strategic Competition

July 22, 2026

• House Committee on Appropriations – Funding Lapses: Analyzing Shutdown Reform
• House Committee on Oversight and Government Reform – a markup to include consideration of the Pharmacists Fight Back Act (H.R.6610) and several other items unrelated to healthcare
• Senate Committee on HELP – a markup on the following bills:
  • S.1414 – Expedited Access to Biosimilars Act
  • S.1874 – Title VIII Nursing Workforce Reauthorization Act of 2025
  • S.2355 – Patients Deserve Price Tags Act
  • S.3014 – Ensuring Timely Access to Generics Act of 2025
  • S.3097 – Health Information Privacy Reform Act
  • S.3788 – Consumer Labeling for Enhanced API Reporting and Legitimate Accountability for Base Entity Listings (CLEAR LABELS) Act
  • S.3794 – Safeguarding Americans from Fraudulent and Experimental (SAFE) Drugs Act of 2026
  • S.380 – Rural Obstetrics Readiness Act
  • S.4110 – Educating Medical Professionals and Optimizing Workforce Efficiency and Readiness (EMPOWER) for Health Act
  • S.4189 – Improving Needed Safeguards for Users of Lifesaving Insulin Now (INSULIN) Act of 2026
  • S.494 – National Plan for Epilepsy Act
• House Committee on Science, Space, and Technology – Unleashing the Golden Age of Science: Examining the Priorities of the FY 2027 Research and Technology Enterprise; Michael Kratsios, director of the White House Office of Science and Technology Policy (OSTP), is expected to testify
• Senate Committee on Indian Affairs – a business meeting on the nomination of Mark Cruz to be director of the Indian Health Service (IHS)
• Senate Committee on Veterans' Affairs (VA) – Advancing the Mission: Evaluating the Future of VA Research

July 23, 2026

• Senate Committee on HELP – an executive session to consider the nominations of Sean Kaufman to be assistant secretary for preparedness and response for the U.S. Department of Health and Human Services (HHS) and Dr. Erica Schwartz to be director of the Centers for Disease Control and Prevention (CDC)

Executive Agencies

• The FDA's Center for Devices and Radiological Health (CDRH) has announced three virtual public town halls on biocompatibility risk assessment and testing. Town hall events will be held on September 9, September 23 and October 7, 2026.

Administrative Updates

Holland & Knight's Health AI Navigator

Holland & Knight's Health AI Navigator is a centralized, interactive resource designed to help healthcare stakeholders track and interpret the rapidly evolving legal and regulatory landscape for artificial intelligence (AI) in healthcare. It provides regularly updated summaries of federal and state legislative, regulatory and executive activity, including developments from Congress, the U.S. Department of Health and Human Services (HHS) and the White House. The Navigator also features an interactive state map and curated analysis to support compliance and policy insights.

Executive Order Updates

The Trump Administration has continued to release wide-ranging executive orders (EOs). For the latest updates, see our "Trump's Second-Term Executive Orders (2025-2026)" tracking chart.

Personnel Updates

• Sen. Ron Johnson (R-Wis.) has taken over as chair of the Senate Committee on the Budget following the death of the late Sen. Lindsey Graham (R-S.C.).

Congressional Updates

CBO Examines Fraud Enforcement Savings to Offset Reconciliation Package

The Congressional Budget Office (CBO) is working with House Republicans to assess the return on investment of increased anti-fraud enforcement, technology and prosecutions within federal health programs, as lawmakers look for ways to offset a proposed $95 billion budget reconciliation package centered on defense funding and the Safeguard American Voter Eligibility (SAVE) America Act. House Budget Committee Chair Jodey Arrington (R-Texas) said CBO analysis of fraud-prevention infrastructure could support building consensus among fiscal hawks concerned about the package's cost. The effort follows continued attention to fraud, waste and abuse in Medicare and Medicaid from Centers for Medicare & Medicaid Services (CMS) Administrator Dr. Mehmet Oz and Vice President JD Vance, including a six-month pause on new Medicare enrollment for certain home health and hospice providers earlier this year.

Democrats Request GAO Study on Funding for FDA RIFs

On July 14, 2026, House Committee on Energy and Commerce Ranking Member Frank Pallone (D-N.J.) wrote to the Acting Comptroller General – who oversees the U.S. Government Accountability Office (GAO) – requesting the GAO study the funding sources used to support 2025 reductions in force (RIFs) at the FDA and how staffing changes may have impacted user fee-funded activities. In his letter, Rep. Pallone says that as the FDA, the Department of Government Efficiency (DOGE) and HHS moved to downsize federal healthcare agencies, employees whose work was funded by user fees were terminated, with some later rehired. He raises concerns that these workforce reductions could affect user fee programs, including the medical device program, which is one of four human medical product user fee programs that must be reauthorized by September 30, 2027. The letter asks GAO to examine several issues that may shape the Committee’s work as it begins reauthorizing these programs, including whether Congress should add further safeguards around the collection and use of user fee funds.

Wyden Files Hatch Act Complaint Against HHS Secretary Kennedy

Sen. Ron Wyden (D-Ore.) announced in a letter to Acting Special Counsel Jamieson Greer on July 13, 2026, that he has filed a Hatch Act complaint with his office and requests the U.S. Office of Special Counsel (OSC) open an investigation into HHS Secretary Robert F. Kennedy Jr. for interfering with candidates for election. Though the consideration of the complaint will be reviewed by OSC, the letter is an example of potential oversight efforts Democrats may take should one or more chambers flip following the general election.

House Republican Leaders Release CR Text As Budget Committee Advances Reconciliation

House Speaker Mike Johnson (R-La.) released a CR on July 17, 2026, that would fund the federal government at current FY 2026 levels through December 4, 2026, creating additional time after the November 2026 election for lawmakers to negotiate longer-term funding. The CR does not include the SAVE Act or other partisan policy riders. Meanwhile, House Republicans advanced the framework for a third reconciliation bill focused on defense, intelligence, agriculture and House administrative activities. Notably, the measure does not direct the Energy and Commerce or Ways and Means committees to identify healthcare-related spending offsets, signaling that healthcare programs are not a current target. With both chambers expected to adjourn for the August 2026 recess soon, lawmakers face a narrow window to advance appropriations and reconciliation efforts.

Sen. Cassidy Seeks Information from Infant Formula Manufacturer

Senate HELP Committee Chair Bill Cassidy (R-La.) on July 15, 2026, wrote to a manufacturer of infant formula requesting information on recent safety investigations into products and subsequent recall notices issued by the company on a voluntary basis. The letter also requests insights into how federal processes may be strengthened in the future, with requests for answers on communications with federal, state and other partners, as well as safety processes related to ingredients and finished products. Congress and FDA have initiated several efforts, including Operation Stork Speed, to improve federal oversight of infant formula and other products, with this letter potentially indicating future activities later this year and into the new Congress.

Regulatory Updates: HHS

HHS, VA Sign MOU to Advance Psychedelic Therapies for Veterans

In connection with EO 14401, the HHS and VA entered into a memorandum of understanding (MOU) to strengthen collaboration on the research, clinical development and responsible deployment of potential future rapid-acting psychedelic drug products for veterans suffering from serious mental health conditions, contingent on FDA approval. The agreement is intended to align HHS and VA efforts as both agencies work to build out the clinical and regulatory infrastructure needed to support psychedelic therapies for veteran populations.

Departments Update No Surprises Act IDR Recertification FAQ, Release Additional Guidance

The HHS, U.S. Department of Labor (DOL) and U.S. Department of the Treasury released an updated frequently asked questions (FAQ) document addressing the recertification process for Independent Dispute Resolution (IDR) entities certified under the No Surprises Act. The updated FAQ provides additional clarity for IDR entities on recertification timelines and requirements as the departments continue to administer the No Surprises Act's arbitration process for resolving out-of-network payment disputes between providers and health plans.

In addition, on July 20, 2026, HHS, DOL and Treasury Department released additional guidance to support the implementation of the Federal Independent Dispute Resolution Operations final rules. The guidance outlines requirements for plans and issuers using claim adjustment reason codes (CARCs) and remittance advance remark codes (RARCs). The codes are standardized and convey information about claims processing. New requirements to provide codes in a manner, circumstances and timeframe specified in the guidance apply to items and services beginning January 1, 2027.

Regulatory Updates: CMS

CMS CY 2027 Physician Fee Schedule Proposed Rule Released

CMS has released the calendar year (CY) 2027 Medicare Physician Fee Schedule (PFS) proposed rule, which includes significant changes to physician payment policies, accountable care incentives, quality reporting and value-based care initiatives. Key proposals include updates to practice expense payments, global surgical reimbursement, Medicare Shared Savings Program (MSSP) policies and a transition away from traditional Merit-based Incentive Payment System (MIPS) reporting after 2028 in favor of specialty-focused MIPS Value Pathways. Comments are due September 14, 2026.

The rule is expected to fuel ongoing debate over physician reimbursement. Although CMS proposes modest statutory payment updates, the expiration of the temporary 2.5 percent Medicare payment increase would result in a net payment reduction for many clinicians in 2027. CMS also proposes enhanced support for primary care and accountable care participation through new payment and incentive models. Holland & Knight recently provided detailed analysis of the proposed rule, with additional commentary from a physician's perspective.

CMS, CDC Issue RFI on CLIA Modernization

CMS on July 16, 2026, issued draft guidance setting forth policies for manufacturer effectuation of the maximum fair price (MFP) in 2028 for drugs selected for the Medicare Drug Price Negotiation Program that are payable under Part B and/or covered under Part D. The Negotiation Program, established under sections 11001 and 11002 of the Inflation Reduction Act (IRA) and codified at sections 1191 through 1198 of the Social Security Act, negotiates MFPs for certain high-expenditure, single-source drugs and biologics. CMS' existing final guidance for initial price applicability year (IPAY) 2028, issued September 30, 2025, already established MFP effectuation policies for 2026, 2027 and 2028 for drugs covered under Part D, and those policies remain in effect. When finalized later this year, this new draft guidance will supersede, for 2028 only, the sections of the existing IPAY 2028 final guidance addressing Part D effectuation that are updated in the new document. The draft guidance reflects CMS' continued work to build out the regulatory framework for later cohorts of negotiated drugs as the Negotiation Program matures.

CMS Issues Draft Guidance on Manufacturer Effectuation of MFP for 2028

CMS on July 16, 2026, issued draft guidance setting forth policies for manufacturer effectuation of the maximum fair price (MFP) in 2028 for drugs selected for the Medicare Drug Price Negotiation Program that are payable under Part B and/or covered under Part D. The Negotiation Program, established under sections 11001 and 11002 of the Inflation Reduction Act (IRA) and codified at sections 1191 through 1198 of the Social Security Act, negotiates MFPs for certain high-expenditure, single-source drugs and biologics. CMS' existing final guidance for initial price applicability year (IPAY) 2028, issued September 30, 2025, already established MFP effectuation policies for 2026, 2027 and 2028 for drugs covered under Part D, and those policies remain in effect. When finalized later this year, this new draft guidance will supersede, for 2028 only, the sections of the existing IPAY 2028 final guidance addressing Part D effectuation that are updated in the new document. The draft guidance reflects CMS' continued work to build out the regulatory framework for later cohorts of negotiated drugs as the Negotiation Program matures.

CMS Announces Nationwide Rollout of Risk-Based Nursing Home Survey Process

CMS announced nationwide implementation of a new risk-based survey (RBS) process for high-performing nursing homes on July 16, 2026, following a pilot of the process in more than 100 facilities across 22 states that began in 2023. Approximately 12 percent of nursing facilities nationwide are expected to initially qualify for the streamlined process. To qualify, a facility must meet criteria on a quarterly basis, including a five-star overall rating on the Care Compare website, accurate data submission to CMS, zero citations indicating harm or substandard care quality in the previous survey cycle, and no recent ownership changes. Qualifying facilities will also receive a designating icon on Care Compare. CMS said the RBS process will reduce the time and staff required to conduct standard recertification surveys at qualifying facilities, though all nursing homes will continue to be surveyed at least every 15 months, and state survey agencies retain discretion to use the traditional survey process where resident health and safety concerns, such as complaints, warrant it. Survey implementation and Care Compare designations are scheduled to begin in September 2026, following state agency training.

Regulatory Updates: HRSA

HRSA Seeks Input on Care Delivery Models for Psychedelic Therapies

The Health Resources and Services Administration (HRSA) on July 14, 2026, issued a RFI seeking stakeholder feedback on training and care delivery models to support the safe administration of potential future FDA-approved psychedelic drugs, including administration in ambulatory settings such as community health centers and rural health clinics. The RFI implements EO 14401, "Accelerating Medical Treatments for Serious Mental Illness," issued in April 2026, which acknowledged that individuals with serious mental illness do not always respond to existing therapies. HRSA is specifically seeking input on how to ensure patients in medically underserved communities have access to psychedelic therapies if approved, along with feedback on workforce training needs for psychedelic care delivery. The agency is requesting detailed responses, including protocols, publications and other supporting data. Comments are due August 13, 2026.

Regulatory Updates: FDA

CDRH Requests Input on Certain Medical Software Functions

The FDA's CDRH issued a request for input on patient safety associated with certain medical software functions that are excluded from the device of a medical device. The input will be used to inform the FDA's development of a 2026 report on the risks and benefits to health of non-device software functions, which include software functions intended for administrative support, encouraging a healthy lifestyle, serving as electronic patient records or providing limited clinical decision support. The report is generated every two years and examines information on the risks and benefits to health associated with non-device software functions. Comments are due by August 13, 2026.

Regulatory Updates: DHS

DHS Finalizes Public Charge Rule, Expanding Consideration of Health and Benefits Use

U.S. Department of Homeland Security (DHS) issued a final rule that gives immigration officials broader discretion to evaluate an applicant's likelihood of becoming primarily dependent on the government when making admissibility determinations. The rule eliminates the current "bright line" test and instead directs officers to weigh a more holistic set of factors, including an applicant's likely future use of Medicaid, the Supplemental Nutrition Assistance Program (SNAP) and federal housing assistance, alongside health conditions, age, education and job skills. The public charge test does not apply to U.S. citizens, most current green card holders, refugees, individuals granted asylum or those with humanitarian visas. The final rule takes effect September 18, 2026. Advocates have noted that prior public charge rule changes were associated with declines in Medicaid and Children's Health Insurance Program (CHIP) enrollment among immigrant families, including household members not directly subject to the rule – a dynamic healthcare stakeholders are likely to monitor as this rule takes effect.

Other Healthcare Regulatory Updates

New SNOMED CT-CPT Mapping Initiative Released Ahead of Prior Authorization Deadline

A major physician association announced an interoperability initiative to support electronic prior authorization by developing and deploying mappings between Systematized Nomenclature of Medicine – Clinical Terms (SNOMED CT) and the Current Procedural Terminology (CPT) administrative coding system. The initiative is intended to help bridge the gap between how clinical concepts are documented in electronic health records (EHR) and how payers evaluate prior authorization requests under Fast Healthcare Interoperability Resources (FHIR)-based application programming interfaces (APIs), ahead of the January 1, 2027, CMS compliance deadline under the Interoperability and Prior Authorization Final Rule. The association will work with health plans, EHR vendors, health information technology developers and other stakeholders to test and refine the mappings, beginning with prior authorization scenarios identified as having the greatest potential to reduce administrative burden.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.