Applied Policy Insight March 2026

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From the President’s Desk: How Policy Advances Care

By Jim Scott, President and CEO

Like medicine, Medicare policy is never static. Over decades of work, we have seen Congress and regulators reassess the statutory and regulatory frameworks governing coverage and payment to keep pace with clinical advances.

This month, our Chief Medical Officer, Bill Rogers, looks back at one of the earliest instances in which Congress altered Medicare’s statutory framework in response to advancing medical practice.

In the first installment of a series on Medicare and organ transplantation, Rogers traces how Congress extended Medicare coverage for kidney transplantation under the ESRD amendment less than a decade after the program’s enactment. The story explores why the expansion was viewed as fiscally manageable at the time and how it reshaped renal care delivery and federal financing responsibilities.

While legislation can usher in major program changes, Medicare is regularly shaped through regulatory interpretation, rulemaking, and model testing within the statutory framework. Much of our work centers on this regulatory layer. Meghan Basler’s story on the Ambulatory Specialty Model illustrates this dynamic by examining CMS’s reconsideration of how specialists are reimbursed for managing chronic conditions and what those changes could mean for participating providers. In a companion piece, Emma Hammer and Caitlyn Bernard Shreve contrast the ACCESS and MAHA ELEVATE models, highlighting the distinct approaches CMS is testing to align payment with outcomes across defined patient populations. Sabrina Luther explores CMS’s evolving enforcement posture, examining the nationwide DMEPOS enrollment moratorium and the launch of the CRUSH initiative as part of a broader effort to strengthen Medicare program integrity.

Prompted by a recent statement from the American College of Physicians, we also reflect on how the language of healthcare — including the terms used to describe clinicians — continues to evolve alongside science and policy.

The Origins of Medicare Transplant Coverage

By William Rogers, M.D., FACEP

This first installment in our series on Medicare and organ transplantation examines how Congress extended eligibility in 1972 and established the program’s role in financing complex, life-sustaining therapies.

Organ transplantation was an emerging and uncommon medical treatment when Congress enacted Medicare in 1965 to provide hospital and physician coverage for older Americans. Although surgical trials had demonstrated that kidney transplantation could succeed, long-term graft survival remained uncertain. Immunology was still developing, and reliable tissue-matching techniques were limited. In creating Medicare and Medicaid through the Social Security Amendments of 1965, Congress likely did not anticipate a federal financing structure for high-cost transplant surgery.

Yet within Medicare’s first decade, Congress departed from the program’s age-based eligibility framework, extending coverage to individuals with end-stage renal disease (ESRD) and establishing Medicare as the principal federal payer for dialysis and kidney transplantation for eligible patients, regardless of age.

Ambulatory Specialty Model: A Structural Shift in Medicare Payment

By Meghan Basler, Senior Health Policy Associate

Mandatory clinician-level accountability marks CMS’s move beyond voluntary demonstrations.

In the CY 2026 Physician Fee Schedule final rule, the Centers for Medicare & Medicaid Services (CMS) finalized the Ambulatory Specialty Model (ASM), a new mandatory alternative payment model under the Center for Medicare & Medicaid Innovation (CMMI). The model is designed to hold individual specialist clinicians accountable for the quality and cost of care furnished to Medicare beneficiaries with two high-cost, high-prevalence conditions: heart failure and low back pain.

ASM will begin on January 1, 2027, and span seven years. It includes five performance years (2027–2031), followed by two additional years for data submission, payment reconciliation, and application of performance-based payment adjustments, concluding in 2033. Payment adjustments will be applied two years after each performance year, aligning with the timing structure used under the Merit-based Incentive Payment System (MIPS).

ASM represents one of the clearest signals yet that CMS is moving beyond voluntary, entity-level demonstrations toward mandatory, clinician-specific accountability. The seven-year runway reflects CMMI’s increasing preference for long-duration models designed to drive durable practice transformation rather than short-term experimentation. For specialists accustomed to annual MIPS adjustments, ASM introduces a more sustained and structurally embedded performance framework.

CMS Advances Chronic Disease Policy Through Payment Reform

By Emma Hammer, Health Policy Manager, and Caitlyn Bernard Shreve, Senior Health Policy Associate

The ACCESS and MAHA ELEVATE models signal CMS’s growing emphasis on outcomes, lifestyle-based interventions, and evidence generation.

CMS continues to refine its approach to quality and outcomes, with growing emphasis on innovative, evidence-based treatments. The Department of Health and Human Services has prioritized advancing care that addresses chronic disease — a theme reflected in recently released models from CMMI.

The Advancing Chronic Care with Effective, Scalable Solutions (ACCESS) Model will test Outcome Aligned Payments to assess whether technology-enabled chronic care can reduce Medicare spending while maintaining or improving quality.

The Make America Healthy Again: Enhancing Lifestyle and Evaluating Value-based Approaches Through Evidence (MAHA ELEVATE) Model is a voluntary initiative evaluating whole-person, functional, and lifestyle medicine interventions designed to complement traditional Medicare fee-for-service care. Participants must incorporate nutrition or physical activity components to support sustained behavioral change. CMS has indicated interest in proposals addressing conditions such as dementia, diabetes, cardiovascular disease, obesity, chronic pain, chronic obstructive pulmonary disease, heart failure, anxiety, and depression.

While innovation in coverage policy is not new, the ACCESS and MAHA ELEVATE models illustrate how CMS is increasingly linking payment reform, chronic disease management, and evidence generation in its evolving approach to coverage and value.

CMS Signals Tighter Oversight of DMEPOS Suppliers

By Sabrina Luther, Health Policy Associate

Nationwide DMEPOS enrollment moratorium and new CRUSH initiative signal a strengthened program integrity strategy.

On February 25, 2026, the Trump Administration announced a series of Medicare program integrity initiatives aimed at strengthening oversight and combating fraud. Key actions include a nationwide moratorium on new enrollment of certain durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) suppliers and the launch of a Request for Information (RFI) related to Comprehensive Regulations to Uncover Suspicious Healthcare (CRUSH), a forthcoming regulatory initiative from CMS. The agency has also signaled plans to increase transparency by publishing revocation data for providers and suppliers whose Medicare participation has been terminated.

Join NVHPF on March 19 for a Conversation on 340B

A key element of federal drug pricing policy and safety-net financing, the 340B Drug Pricing Program remains a focus for Congress and federal regulators as policymakers examine questions related to oversight, statutory authority, and program administration.

We invite you to join the Northern Virginia Health Policy Forum on March 19 as we convene a panel of experts to discuss the program’s development, recent legislative and regulatory activity, and considerations for stakeholders navigating its evolving framework.

Featured speakers include Greg Doggett, Counsel at Powers Law; William Newton, Associate Editor and Senior Writer at 340B Report; and Elizabeth Linderbaum, Director of Regulatory Affairs at the National Association of Community Health Centers.

NVHPF regularly convenes policy leaders to examine key health policy developments. Suggestions for upcoming topics are always welcome. Annie Tuttle leads NVHPF programming and coordination. She can be reached at atuttle@appliedpolicy.com.

Are Physicians “Providers”? The Language of Healthcare

The debate over “provider” continues decades after its adoption.

In February, the American College of Physicians joined a long-running debate over whether physicians should be called “providers,” urging more precise terminology in clinical and policy settings.

The word traces back to the early years of Medicare and Medicaid, when lawmakers adopted a neutral umbrella term to describe hospitals, physicians, and other entities furnishing services. Over time, “provider” became embedded in statutes, regulations, and payment systems, and eventually in everyday use.

Professional organizations continue to wrestle with how language shapes identity, authority, and public understanding in modern healthcare. For writers and students of health policy, the challenge is balancing professional preference with the terminology that appears in statute and regulation.

Cheryl Powell to Speak at ADVION

2026 Legislative & Regulatory Conference

Applied Policy's Cheryl Powell will be a featured speaker at the ADVION 2026 Legislative & Regulatory Conference, taking place March 9–11 in Washington, D.C.

ADVION is a national consortium representing companies that provide services and products to long-term, post-acute, and senior care markets. Its annual Legislative & Regulatory Conference convenes industry leaders and policy experts to examine federal developments affecting the sector.

Powell will lead a session titled “The Launch of the CMS Models,” examining three recently released CMS innovation models — ACCESS, MAHA ELEVATE, and LEAD — and their potential implications for ADVION member organizations. The session will review each model’s goals, structure, timelines, and eligibility considerations, with particular attention to how therapy providers and long-term and post-acute care organizations may engage.

The conference agenda also includes sessions on Medicare compliance priorities from CMS officials, bipartisan Capitol Hill perspectives on physician-led health policy, and discussions of interoperability, artificial intelligence, and digital quality initiatives shaping the next phase of federal oversight.

On the Docket/Under Review

Applied Policy is following these rules under review at the Office of Management and Budget:

Amending the Indirect Hold Harmless Threshold of Health Care-Related Taxes
Administrative Simplification: Adoption of Standards for Health Care Attachment Transactions and Electronic Signatures
Interoperability Standards and Prior Authorization for Drugs
Hospital Inpatient Prospective Payment Systems for Acute Care Hospitals; the Long-Term Care Hospital Prospective Payment System; and FY 2027 Rates
Independent Dispute Resolution Operations
Strengthening Oversight of Accrediting Organizations (AO), Burden Reduction, and Related Provisions
FY 2027 Hospice Wage Index, Payment Rate Update, and Quality Reporting Requirements
FY 2027 Skilled Nursing Facility (SNFs) Prospective Payment System and Consolidated Billing and Updates to the Value-Based Purchasing and Quality Reporting Programs
Contract Year 2027 Policy and Technical Changes to Medicare Advantage, Medicare Prescription Drug Benefit, Medicare Cost Plan, and Programs of All-Inclusive Care for the Elderly Programs
FY 2027 Inpatient Psychiatric Facilities Prospective Payment System Rate and Quality Reporting Updates
FY 2027 Inpatient Rehabilitation Facility (IRF) Prospective Payment System Rate Update and Quality Reporting Program
Medicare Drug Price Negotiation Program
Medicaid Managed Care State Directed Payments and Medicaid Fee-For-Service Targeted Medicaid Practitioner Payments