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centers for medicare and medicaid services
A Rural Health Fund Band-Aid Will Not Staunch the Bleeding
The Trump administration’s rural hospital fund, meant to soften the impact of the brutal Medicaid cuts in HR1, will require a murky submission process and will not come close to closing the gap for rural communities.
Nov 04, 2025
Amid furious efforts to cover their tracks, Republicans included $50 billion in new funding to offset the disastrous cuts that rural hospitals will face as a result of President Donald Trump’s House Resolution 1. Trump’s new Centers for Medicare and Medicaid Services Director, Dr. Mehmet Oz, gave an explanation which would be laughable if this weren’t so serious. He stated that the Rural Health Fund “is part of a broader effort to modernize rural healthcare… [and that] innovation is the reigning theme” citing growing opportunities for rural providers to become more engaged in the healthcare system.
The “Rural Health Fund” was established by HR1 to soften the impact of the legislation, which cuts $911 billion in federal Medicaid spending over 10 years, due to start after 2030. The good news is that the distribution of the $50 billion will begin before the Medicaid cuts take effect (conveniently before the midterms). The bad news is that the temporary $50 billion in new funding will offset a little over one-third (37%) of the estimated $137 billion in permanent cuts to federal Medicaid spending in rural areas. People everywhere can do the math. Fifty is a whole lot less than 137.
On September 15, Centers for Medicare and Medicaid Services (CMS) released a Notice of Funding Opportunity for states to apply for the funds. Half of the funds, $25 billion, will be distributed by CMS equally across all states with approved applications, and the other half distributed based on four factors identified by CMS, including priorities that align with the Make America Healthy Again agenda. While some of the goals are welcome, such as expanding access to opioid-use and substance-use disorder treatment and mental healthcare and recruiting and retraining clinicians in rural areas, other priorities, such as supporting value-based care, alternative payment models, and other innovative delivery arrangements that shift risk to practitioners away from insurance companies and that have been demonstrated to increase costs in Medicare, are worrisome. Predictably, no funds can be used to pay for abortions for women living in rural areas.
Each state, regardless of the size of their rural population and needs, will receive the same amount from the first $25 billion tranche. States with few rural hospitals, such as Delaware, with three rural hospitals, will receive equal funding as California, with 66 rural hospitals, some of which have closed and many which are at risk of closing, and that assumes that both states are approved for funding.
We urge residents of rural communities to stand together and demand the right to excellent healthcare that our wealthy nation can and must provide.
Disbursement of the funds promises to be a cronyism gravy train requiring applications, murky decision criteria, no administrative or judicial review, and nonexistent information as to the amount a state will receive, how the funds will be distributed, or even if the funds will go only to rural hospitals. A merit review panel will review the state applications with final award decisions made by CMS. The program runs for five years, but because CMS will reevaluate state initiatives every year, CMS could withhold, reduce, or even recover funding from the state depending on a state’s progress or if continued funding is “in the government’s best interests.” The only thing that is clear is that hospitals and their administrators will spend countless hours and resources on evaluation, reports, and contractors hired to write these reports.
The stakes for rural hospitals couldn’t be higher. As a result of the Medicaid cuts, hundreds of rural hospitals are at risk of closing. But even before cuts, rural hospitals have been shuttering: From 2005 to 2024, 193 rural hospitals closed. In the wake of HR1Sen. Ed Markey (D-Mass.) and others asked the Sheps Center to identify rural hospitals at risk of closing because of the Medicaid cuts. The Sheps Center identified 338 hospitals which either experienced three consecutive years of negative total margins, serve the highest share of Medicaid patients, or both. These are the hospitals that, because of their heavy reliance on Medicaid funds, will likely shutter.
What will happen to the millions of people who live in these rural communities when these hospitals close? The median travel distance to the next hospital, emergency room, substance-use, or heart specialty care center will jump seven- to eightfold. This translates to higher mortality from many common conditions: heart disease, cancer, stroke, and unintentional injury.
In "The False Promises of VA Privatization", author Suzanne Gordon highlights the plight of healthcare access for veterans and Americans who live in rural communities, the majority of whom already live in so-called medical and mental health deserts. For example, 81% of rural communities do not have even one psychiatric nurse practitioner and 65% do not have a single psychiatrist. The shuttering of rural hospitals will also mean the loss of thousands of healthcare worker jobs and the ensuing negative economic impact on those communities.
The $50 billion rural health fund earmarked by the Trump administration will not transform these rural medical deserts, will not protect the livelihood of workers and their families, nor will it safeguard their communities. The piddly funds will not staunch the bleeding the brutal cuts to Medicaid will cause.
National Single Payer has launched a “Save Our Rural Hospitals with National Single Payer” campaign. We believe that a national, improved Medicare for All, free from profit in the financing and the delivery of care, would provide the reliable, equitable funding needed to help hospitals and physicians not only survive, but thrive in rural areas. The funding from global budgets would be based on community healthcare needs and not on industry interests.
We urge individuals who live in districts where the at-risk hospitals are located to contact their representatives and ask them to cosponsor HR3069, the Medicare for All Act. If your representative is already a cosponsor, tell them to do more to put national single payer on the nation’s agenda.
People can also pass a resolution in their local organization or city council going on record in favor of saving and sustaining their rural hospitals by calling on Congress to pass national, improved Medicare for All, free from profit.
We urge residents of rural communities to stand together and demand the right to excellent healthcare that our wealthy nation can and must provide. The 46 million people living in America’s rural communities don’t need a temporary Band-Aid—they deserve what everyone deserves, no matter where they live—healthcare as a human right, free from profit.
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Senators Accuse Trump Admin of Hiding Info on 'Biggest Premium Hike in History'
"Millions of Americans who buy their own insurance on Healthcare.gov are unaware of the catastrophic premium hikes barreling towards them," the senators warned.
Oct 27, 2025
More than half of the Democratic Party caucus in the US Senate on Monday accused the Trump administration of covering up massive planned premium increases that are going to hit Americans who buy their health insurance through Affordable Care Act exchanges.
In a letter to Centers for Medicare and Medicaid Services (CMS) administrator Mehmet Oz, the senators charged that his agency has "failed to open early window-shopping" the week before the start of open enrollment, which they said has left "millions of Americans who buy their own insurance on Healthcare.gov... unaware of the catastrophic premium hikes barreling towards them."
The senators emphasized that the early window-shopping period is crucial because "the 24 million people who buy insurance on the ACA Marketplace need as much time and information as possible to understand and prepare for these significant premium increases."
The letter also argued that CMS has reduced enrollees' ability to access this crucial information by issuing guidance last summer that "allowed insurance companies to omit premium numbers and tax credit information from the notices they are required to send to enrollees ahead of open enrollment," while also "allowing insurance plans to delay sending information to their enrollees."
As a result of this, the letter continued, "millions of Americans have still not received any information from their insurance plan, or from CMS, about the biggest premium hike in history."
The senators' letter concluded with a demand for CMS to "launch window-shopping immediately and deliver the transparency American families deserve ahead of open enrollment on November 1."
The fight over health insurance premiums is at the heart of the current shutdown of the federal government, as Democrats say they will not vote to fund the government without an extension of enhanced ACA tax credits that were first passed into law under the American Rescue Plan in 2021.
The Washington Post last week reported on leaked documents showing that the most popular healthcare plans purchased on the ACA exchanges are expected to see a 30% hike next year, which would mark the "largest annual premium increases by far in recent years."
Were the enhanced tax credits for these plans allowed to expire, the Post added, this would likely result in millions of Americans seeing their insurance premiums double or triple next year.
The expiring subsidies aren’t the only threat to Americans’ healthcare, as Republicans over the summer passed a massive budget law that cut spending on Medicaid by nearly $1 trillion over the next decade, which the Congressional Budget Office estimated would result in more than 10 million people, among the nation’s poorest, losing their coverage. Congressional Democrats have also demanded undoing some Medicaid cuts in government shutdown negotiations.
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Just Say No to AI-Assisted Medicare Preauthorization
A new AI-driven Medicare prior-authorization pilot could dramatically weaken Medicare, just another frightening step toward privatization and profiteering.
Sep 03, 2025
The odds are that if you have private health insurance or someone in your family has private health insurance, you have heard the dreaded phrase “we need preauthorization” from your insurance company. What this means is that your insurance company needs to approve in advance that your treatment or prescription is covered. In theory, this should be no big deal. However, reality is something else. But as the New York Times points out:
Private insurers often require a cumbersome review process that frequently results in the denial or delay of essential treatments that are readily covered by traditional Medicare. This practice, known as prior authorization, has drawn public scrutiny, which intensified after the murder of a UnitedHealthcare executive last December.
So, reading this you might think that you are glad that you or someone in your family choose traditional Medicare (in other words not a Medicare Advantage plan), so you would be able to avoid the “prior authorization needed” drama. Well, unfortunately you would be wrong as the prior authorization is slowly coming to Medicare. In late June, the Centers for Medicare and Medicaid Services (CMS) issued a press release:
The Centers for Medicare & Medicaid Services (CMS) is announcing a new Innovation Center model aimed at helping ensure people with Original Medicare receive safe, effective, and necessary care. Through the Wasteful and Inappropriate Service Reduction (WISeR) Model, CMS will partner with companies specializing in enhanced technologies to test ways to provide an improved and expedited prior authorization process relative to Original Medicare’s existing processes, helping patients and providers avoid unnecessary or inappropriate care and safeguarding federal taxpayer dollars. This model builds on other changes being made to prior authorization as announced by the US Department of Health and Human Services and CMS on Monday.
In theory, this move by CMS does not sound bad. Who could be against reducing wasteful spending in Medicare and making sure that people receive appropriate treatment? A spokesman for CMS has been quoted that the government would not review emergency services or hospital stays.
The CMS prior Medicare authorization model is being rolled out in January 2026 as a six-year trial program in six states: Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington State. In theory, the preauthorization program will look at those medical treatments that are not of benefit to Medicare beneficiaries.
What CMS is not drawing attention to is that this preauthorization will be done by artificial intelligence (AI)—or as CMS puts it “enhanced technologies.” It is not until much later in the press release that CMS gets to the fact that AI will do the screening authorization:
The WISeR Model will test a new process on whether enhanced technologies, including artificial intelligence (AI), can expedite the prior authorization processes for select items and services that have been identified as particularly vulnerable to fraud, waste, and abuse, or inappropriate use.
CMS, at the moment, says that the AI preauthorization screening will be used on only an extremely limited number of procedures. But what guarantees do Medicare beneficiaries have? The bottom line is that you have to ask yourself: Would you be comfortable having your access to your earned Medicare benefits be determined by AI? My answer is a firm, “No, thank you.”
We also need to ask what are the financial incentives that Medicare is injecting into the system though preauthorization? It is hard not to conclude that this is a step toward privatization of traditional Medicare.
Healthcare professionals are concerned by CMS’ preauthorization program. In mid-July, the American Medical Association (AMA) wrote to CMS:
While the stated goal of the model is to curb wasteful spending and protect the Medicare Trust Fund, the mechanisms employed raise several significant issues that must be addressed prior to implementation. The AMA strongly urges CMS to pause the January 1, 2026 implementation of the WISeR Model to allow additional stakeholder input, full analysis of the model’s operational impacts, and development of clear guidance for physicians. Physicians should not be forced to adapt to such substantial administrative requirements without sufficient time to understand the implications and prepare. Absent this opportunity for meaningful physician and stakeholder engagement, the model risks creating confusion, administrative burden, and unintended consequences that could ultimately undermine CMS’ own goals to reduce waste, fraud, and abuse.
On Capitol Hill, a number of House Democrats led by Rep. Alexandria Ocasio-Cortez of New York have pushed back on the AI preauthorization pilot project. In late July, they wrote to CMS:
We understand that CMMI has intentionally selected healthcare services that are reported to have limited clinical value and may be vulnerable to abuse in the Medicare program, and we support efforts to ensure Medicare remains a good steward of taxpayer dollars. However, the expansion of AI-fuelled prior authorization will not improve program integrity in Traditional Medicare. Giving private for-profit actors a veto over care provided to seniors and people with disabilities in Traditional Medicare, even as a pilot program, opens the door to further erosion of our Medicare system. We therefore strongly urge you to immediately halt the proposed WISeR model and instead consider steps to address the well-documented waste, fraud, and abuse in the Medicare Advantage program.
The House Democrats raise a very intriguing question about why CMS is not focused more on fighting waste, fraud, and abuse in Medicare Advantage plans? As the Center for Budget and Policy Priorities reported in January of this year, there is considerable evidence to show that Medicare Advantage plans are overpaid by the government. It would make sense for CMS in pursing fraud and waste to follow the money which means looking at Medicare Advantage plans.
Give the political dynamics in Washington, it seems likely that the CMS preauthorization demonstration project will go into effect in January 2026. Then in the summer of 2026, with the midterm elections looming, as members of Congress will begin hearing from constituents who have had their earned Medicare benefits denied by AI, Congress will revisit this issue. It is tragic that in the meantime people will be hurt.
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