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Medicaid

Maia Anderson

Healthcare Brew delivers the latest news and trends in healthcare.

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Ever wonder what entices an executive to jump ship and join a new health system? For Amy Perry, Banner Health’s insurance arm caught her eye.

Perry joined the Arizona-based nonprofit health system as president and COO in November 2021 and took the reins as president and CEO in July 2024. Before joining Banner, she was SVP of integrated care delivery and CEO of New Jersey-based Atlantic Health’s hospital division for four years.

Banner is Arizona’s largest health system and consists of 33 hospitals that handle roughly 6.4 million clinic visits per year and have more than 55,000 employees. The system brought in $15.6 billion in revenue in 2024.

Perry told Healthcare Brew the fact that Banner has its own health plan with about 1.2 million members was a big part of the reason she took the job, as she sees provider-sponsored health plans, or PSHPs, as a “really important approach to healthcare.”

PSHPs are health insurance companies that are owned, either partially or fully, by a health system, hospital, or other provider group. The largest example is the Kaiser Foundation Health Plan, which has more than 12.6 million members and is run by Kaiser Permanente, a California-based health system.

As of 2022, 197 health systems in the US (or 31%) have PSHPs, according to healthcare analytics firm Trilliant Health.

PSHPs help health systems move away from a 

Healthcare’s reliance on sick people to generate revenue is a primary reason costs keep rising, according to Perry.

“When we are able, as health systems, to get premium revenue, we can actually save money when people stay well. It’s almost a completely shifted paradigm,” she said.

About 74% of Banner’s revenue came from the fee-for-service side of the health system and about one-quarter (or about $4 billion) came from premiums in 2024, Perry said.

“I’m just a fervent believer that we’ve got to find a way to migrate, as health systems, toward more of this at-risk, premium-based care,” she said.

However, it’s not easy to be both insurer and provider, according to Katherine Hempstead, a senior policy officer at healthcare research organization Robert Wood Johnson Foundation.

That’s because providers are typically incentivized to do more higher-cost procedures while payers try to keep costs down.

“When you’re trying to do both jobs, it can create a conflict,” Hempstead said.

Some large hospitals, including Northwell Health, the largest health system in New York, have 

 to create PSHPs. Northwell blamed high risk adjustment payments for why it shuttered its PSHP, CareConnect Insurance Company, in 2017, Fierce Healthcare reported. 

Perry acknowledged how hard it is to run both a health system and an insurer, saying “it’s very difficult to live in both worlds.”

However, despite the challenges, there are also upsides, she added, such as premium revenue that allows the health system to invest in chronic disease management and other things “you wouldn’t even consider on the fee-for-service side because there’s simply not enough funding.”

But premium revenue hasn’t shielded Banner from broader industry headwinds like Medicaid funding cuts and 

President Trump’s One Big Beautiful Bill Act, which was signed into law on July 4, is set to 

 by about $1 trillion over the next 10 years. Perry said Banner is bracing for a reality in which some services may have to be cut.

“We have a significant commitment to Medicaid patients and the service lines, but at the same time, there’s only so much we can do if we are scaled back,” Perry said. “Access will be affected, not only in clinics but in emergency rooms.”

To prepare for the cuts, which will take effect 

 over the coming years, Banner is “battening down the hatches like most health systems and trying to reduce our expenses as much as possible,” she said.

Tariffs on products like aluminum and steel already cost Banner roughly $23 million as of September, according to Banner’s SVP of Finance Adrienne Moore, and the health system expects that figure to be less than $35 million by the end of 2025.

In addition to navigating Medicaid cuts and tariffs, one of Perry’s top goals as CEO involves a $1 billion investment in technology the health system plans to pay over the course of five years, she said.

As part of that initiative, Banner created its own ChatGPT-like program called BannerWise via a 

 with AI company Anthropic to analyze data from things like physician notes and pathology results, Modern Healthcare reported earlier this month. Perry told Healthcare Brew this will help providers use the health system’s data “in a more strategic and analytical way.”

Beyond investing in technology, Perry said she’s very focused on connecting with the communities the health system serves in the near term.

“If we’re able to do that and we do it successfully over the next five years, I’m going to be one happy CEO,” Perry said. 

A woman, Amy Perry, Banner Health CEO, cutout and contained in an abstract shape while breaking the frame.

Banner Health CEO Amy Perry on running a health system with an insurance business

From health insurance to Medicaid cuts, Perry dishes on her first year leading Banner Health.  

Banner Health CEO on running a health system with an insurance business

Cassie McGrath

The One Big Beautiful Bill Act is set to have big implications for hospitals and 

. But experts say it could also impact patient care—specifically, maternal health.

 for maternal and infant mortality and morbidity, according to the 2024 March of Dimes Report Card. Now, the bill is cutting federal spending on Medicaid and the Children’s Health Insurance Program (CHIP) by $1 trillion, 

 beneficiaries potentially without coverage by 2034.

This is a challenge, as Medicaid is the largest single payer for pregnancy-related services, KFF reported in May, covering 41% of births across the country and nearly half of births in rural areas. States with the most rural hospitals are 

 to have reproductive rights restrictions. (For example, Alabama, Oklahoma, and Texas all have abortion bans and are experiencing a rural health crisis.)

“Medicaid is vital for moms and babies in this country,” Michael Warren, chief medical and health officer at nonprofit March of Dimes, told Healthcare Brew.

Additionally, there’s a growing fear Medicaid cuts will 

 of some rural maternal care units or entire facilities, experts previously told Healthcare Brew. When hospitals close services, 

This means not only are there healthcare workers leaving—or 

 to—these states but there’s also likely to be 

 in places where abortion isn’t allowed.

“We’re at a moment where we need to be doing all we can to think about increasing access and helping people get healthier before pregnancy and have a healthy pregnancy,” Warren said. “Anything we do that takes our foot off the gas is not moving us in the right direction.”

Planned Parenthood is one example of maternal health clinics that may be hit by cuts.

 of a preliminary injunction to stop Medicaid cuts from affecting Planned Parenthood, but the nonprofit organization is still on the chopping block for potential defunding.

Planned Parenthood has been reportedly “targeted” for 

, but the centers provide more than reproductive care, offering preventative and primary care, Monica Skoko Rodríguez, director of medical standards production at Planned Parenthood, told us. 

The organization also treats underserved populations, with 76% of 600 Planned Parenthood centers based in “rural or medically underserved areas,” according to a fact sheet.

If it were defunded, patients could lose access to care like cancer screenings and intimate partner violence screenings, she added, leaving them to turn to hospitals for care instead. Avoidable emergency department visits overall cost the healthcare system an estimated $32 billion each year, 

“They are not going to be able to access [these resources] until things really spiral out of control, and that’s where we see an overload in emergency care systems and hospital systems, when things would have been much better managed much earlier on and would have had much better outcomes for the patient and for the healthcare ecosystem at large,” Rodríguez said.

A black pregnant woman with a medical cross logo glowing behind her

Medicaid cuts could lessen access to maternal health

The US already received a D+ for maternal and infant mortality and morbidity from March of Dimes. 

The Department of Health and Human Services (HHS) and Centers for Medicare and Medicaid Services (CMS) are forming a new committee meant to advise the agencies on policies to “improve how care is financed and delivered” under federal health insurers.

Dubbed the Healthcare Advisory Committee, the group is intended to help HHS and CMS meet goals set under the Trump administration’s Make America Healthy Again agenda. This includes chronic disease prevention, reducing “unnecessary red tape” within federal insurance programs, making Medicare Advantage more sustainable, and identifying “structural opportunities to improve quality for the most vulnerable in the Medicaid program,” according to an Aug. 21 agency press release. 

Ge Bai, a professor of health policy and management at Johns Hopkins Bloomberg School of Public Health, told Healthcare Brew that deregulation will likely be a priority.

“To me, it’s probably a signal of some kind of a significant change in direction as compared to previous administrations,” Bai said.

An obvious area for deregulation would be CMS’s physician quality reporting program, according to Bai. A 2023 study conducted at Johns Hopkins Hospital, which Bai coauthored, found quality reporting took the hospital 108,478 hours in 2018, amounting to more than $5 million in personnel costs.

The American Medical Association, a national professional group representing physicians, has previously 

 the Trump administration to reduce reporting requirements.

, HHS and CMS said the advisory committee will focus on finding ways to “allow providers to focus on improving patient health outcomes, not filling out paperwork.”

The committee is set to consist of 15 volunteer members, appointed by CMS Administrator Mehmet Oz. The members will report directly to Oz and HHS Secretary Robert F. Kennedy Jr. for two years. CMS is looking for experts in “chronic disease prevention and management, federally administered healthcare financing, and delivery system reform,” according to the release. Nominations are due by Sept. 22, and the officials plan to select members later this year.

When it comes to improving Medicaid, the committee will be tasked with looking for ways to improve the quality of the program “outside of more funding for the current system,” the notice stated. And with Medicare Advantage, the committee is specifically supposed to look for ways to “modernize risk adjustment and quality measures that assess and improve health outcomes.”

Spokespeople for HHS and CMS declined to provide further comment clarifying the committee’s goals or how it will function.

The group’s formation comes after the Trump administration’s dismantling of several federal healthcare advisory committees.

 the CDC’s Healthcare Infection Control Practices Advisory Committee, which created national standards meant to slow the spread of infectious diseases.

 all members of the Advisory Committee on Immunization Practices, a CDC committee that recommended how to use vaccines to manage public health.

 Research and Practice were also shut down this year. 

Two hands exchanging money and a love heart with a heartbeat line running through it

New federal health committee formed by HHS, CMS to ‘improve’ how care is provided, financed by federal payers 

The new group emerges after the Trump administration dismantled a number of federal health committees. 

New federal health committee formed to ‘improve’ how care is provided, financed by federal payers 

When you think of healthcare innovation, you may think of 

artificial intelligence (AI)-powered medical devices

 that can diagnose diseases quicker than a doctor or devices that can 

But if you ask Kyu Rhee, president and CEO of the National Association of Community Health Centers (NACHC), the “most innovative part” of the healthcare system is one that’s already been around for 60 years: 

Established in 1965 as part of President Lyndon B. Johnson’s War on Poverty, CHCs provide primary healthcare services including chronic disease management, cancer screening, dentistry, behavioral health, and more to patients regardless of whether they can pay or are insured.

Today, CHCs treat nearly 1 in 10 people across the US. As head of NACHC, which represents the roughly 1,500 CHCs across the US, Rhee has big plans to expand that number to 1 in 3.

“I do believe when you look at the broader system, there’s no better model of primary care,” Rhee said. “Our model is very focused on those communities that need us the most, and in many ways, it’s defined by people who are low income or poor.”

Rhee took the helm of NACHC in July 2023 after a healthcare career spanning both public and private roles, including chief medical officer of CVS Health’s Aetna division and chief public health officer at the Health Resources and Services Administration, a division of the Department of Health and Human Services that focuses on providing care to vulnerable populations.

Rhee told Healthcare Brew he took the role as president and CEO of the nonprofit organization because he thinks, in addition to being the most innovative, CHCs are the best and “most resilient” part of the healthcare system.

Part of what makes them so is the fact that they “save lives and save money,” he said.

Though CHCs treat about 10% of the US population—that’s nearly 34.7 million people—they only cost about $55 billion, or 1% of all healthcare spend, according to NACHC. That’s because they’re efficient, affordable, and local, according to Rhee.

Plus, CHCs are required by law to be nonprofits and serve their communities, so they can’t be scooped up by giant for-profit corporations like Optum or CVS Health.

Another factor that keeps costs low, Rhee said, is that CHC boards are required to be made up of at least 51% patients, meaning the people they treat get a say in how the clinics are run.

However, it’s not easy to treat so many people while keeping costs down.

The two biggest challenges on Rhee’s mind at the moment are 

The NACHC says half the patients treated at CHCs are on Medicaid, which Rhee calls the “lifeblood” of the clinics. CHCs get roughly 42% of their revenue from the public payer, “so we need Medicaid to be protected in order to do the work that we do in saving lives and saving money in communities across this nation,” he said.

The Trump administration’s One Big Beautiful Bill, which was signed into law on July 4, reduces federal Medicaid spending by an estimated $990 billion over 10 years, according to 

Louise McCarthy, president and CEO of the Community Clinic Association of Los Angeles County—which represents the more than 450 CHCs serving about 2 million people across the region—told Healthcare Brew the organization is bracing for “seismic shifts in the healthcare landscape in Los Angeles and beyond” because of the cuts to Medicaid.

“We’re looking at 3.4 million Californians falling out of coverage, and an estimated loss of $30 billion in federal funding for California,” McCarthy said. “If these folks don’t have coverage, how are we going to get them access to specialty care, to hospitals? We’re probably going to see a lot of hospital closures, and we won’t have places to send our patients.”

Staffing is also a big challenge, Rhee said, noting CHCs typically have a team of 10 providers to treat 1,000 high-need patients, who often live below poverty level.

McCarthy echoed that sentiment, saying it’s “really, really hard” as a nonprofit to “recruit and compete against larger, more resourced organizations.”

Though he’s only led NACHC for a short time, Rhee already scored a major win in March 2024 when CHCs received the first increase in federal funding in nearly 10 years, bringing the total to $4.4 billion annually.

Rhee said he considers this one of his biggest accomplishments during his tenure at the nonprofit.

“The fact that we’ve been nonpartisan and gotten bipartisan support is part of what I’m very proud of in my first couple years at NACHC,” he said.

Looking ahead, in order to meet NACHC’s goal of treating 1 in 3 people by 2045, “we need funding, we need workforce…we need to protect Medicaid,” Rhee said.

“We need to demonstrate that we’re a core part of making America healthy.”

National Association of Community Health Centers’s Kyu Rhee on the future of community health centers

These clinics rely heavily on Medicaid funding, which was slashed in the One Big Beautiful Bill. 

Kyu Rhee on the future of community health centers

The opioid epidemic has been a defining public health crisis in the US for the past quarter century. 

With more than 800,000 people dead from overdoses over nearly 25 years, it’s hard to find an event—outside of the 

—that has impacted the US healthcare system more. The economic cost of opioid use disorder and opioid overdoses in the US was estimated to be more than $1 trillion in 2017 alone, according to 

Today, the number of overdose deaths has 

. But experts warn impending changes to Medicaid could slow that progress.

Further, overdose deaths are still higher than they were pre-pandemic, Thuy Dieu Nguyen, an assistant professor of health management and policy at the University of Michigan School of Public Health, told Healthcare Brew.

“We still have an ongoing opioid crisis,” she said.

The CDC breaks the opioid epidemic into three waves.

The first began in the 1990s, when doctors started prescribing more opioids for pain control, driven largely by Purdue Pharma’s OxyContin hitting the market in 1996. The second wave that began in 2010 saw an increase in heroin deaths, as the drug became cheaper and more available in the US. The third wave began in 2013 as synthetic opioids, primarily fentanyl-based drugs, rose in popularity.

The CDC first called the opioid crisis an “epidemic” in 2011, and in October 2017, President Donald Trump declared it a public health emergency.

 targeted opioid manufacturers, pharmaceutical distributors, and pharmacies for allegedly “aggressively marketing” the drugs while “downplaying addiction and overdose risks.”. In 2019, Purdue Pharma, the maker of OxyContin, 

. Though the company had profited $35+ billion from opioid sales, it was later forced to 

But what didn’t receive much legal attention—until recently—is the role of 

 (PBMs), which negotiate with drug companies to create formularies for insurers.

A group of lawmakers asked the Department of Justice in December 2024 to investigate 

 in the opioid epidemic, saying in a letter that 

 and a review of confidential files suggested the Big 3 PBMs—CVS Caremark, Express Scripts, and Optum Rx—“colluded and conspired to steer patients toward OxyContin in exchange for $400 million.”

 in December they offered payers the option to restrict opioid prescriptions.

After skyrocketing during the pandemic, the number of opioid-involved deaths started falling in 2023 for the first time since 2018, according to CDC data.

Between 2022 and 2023, the number of overdose deaths involving synthetic opioids fell by 2%, heroin by about 33%, and prescription opioids by almost 12%.

Further, provisional CDC data shows total drug overdose deaths fell about 27% from 110,037 to 80,391 between 2023 and 2024.

Experts aren’t sure why, exactly, overdose deaths have started dropping so significantly, but Nguyen said there are a few potential explanations.

First, some experts think that because fentanyl overdoses have already killed so many people in recent years, the number of high-risk drug users is shrinking, she said.

Second, harm reduction measures, like increased access to naloxone, an opioid overdose reversal drug, may be working. In March 2023, the FDA 

 over-the-counter Narcan (a brand-name naloxone), which can also be bought online.

“The interventions are now working,” Nguyen said. “People have easier access to naloxone, fentanyl testing strips, or certain things that have helped individuals to cope with deadly fentanyl products.”

Access to other opioid use disorder treatments, such as buprenorphine, has also been expanded significantly, Nguyen said. For instance, during the pandemic, the Drug Enforcement Agency and Substance Abuse Mental Health Services Administration allowed providers to prescribe buprenorphine after an audio-only telehealth call instead of requiring patients to go in person. That rule became permanent in January 2025.

And policies passed during the pandemic, including 

 that allowed beneficiaries to stay enrolled through the public health crisis, likely helped, she added. 

 shows that 47% of nonelderly adults with opioid use disorder are Medicaid beneficiaries.

Additionally, many states no longer require prior authorization for at least one type of buprenorphine, Heather Saunders, a senior research manager for KFF’s program on Medicaid and the uninsured, told us. That’s led to an increasing number of prescriptions for the treatment, she added.

Potentially the biggest threats to this progress are the looming 

, as Medicaid “finances the largest share of medication-assisted treatment,” Saunders told us.

, which was signed into law on July 4, cuts Medicaid funding by about $1 trillion over the next 10 years and puts work requirements in place, which means beneficiaries must prove they spend 80 hours per month working, going to school, or doing other approved activities like community service.

The added paperwork burden that comes with work requirements may cause coverage gaps, which could raise the risk of overdose deaths, Saunders said.

Stopping opioid use disorder treatment is linked to a 6x higher mortality risk for the first four weeks after interrupting treatment, according to the KFF analysis, which Saunders co-authored.

 overall will become uninsured,” she said. “So, to the extent that includes people with opioid use disorder, that might have implications for them being able to access treatment continuously.”

Where the opioid epidemic stands amid Medicaid cuts, work requirements 

Cuts to Medicaid funding could have a chilling effect on recent progress curbing opioid overdose deaths. 

Where the opioid epidemic stands amid Medicaid cuts 

illustrated headshot of caroline catherman, healthcare brew reporter

Caroline Catherman

Investors lost an adjusted 16 cents a share in Q2, a huge fall from last quarter’s adjusted gain of $2.90 per share. The company also gave a new projection for earnings per share in 2025: $1.75. The Wall Street Journal 

 this is far less than the previously projected $7.25+.

Centene, which focuses on government subsidized plans, 

 its revenue guidance on July 1 following a report from actuarial firm Wakely suggesting fewer people would get marketplace coverage than expected, and those who did would need more expensive care.

Centene CEO Sarah London said the company is adjusting 2026 pricing for its marketplace plans, which have nearly 5.9 million members as of the end of Q2.

“We continue to believe that we will be able to reprice the 2026 portfolio to account for a substantial majority of our marketplace membership, and our goal is to reprice 100% of the book,” London said.

Though marketplace plans have been getting most of the attention, Friday’s call also shed light on another major pressure point: the company’s 12.8 million Medicaid members.

Centene’s overall health benefits ratio—the percent of premium dollars spent on medical care—jumped from 87.5% to 93% between quarters. London said its Medicaid health benefits ratio reached “an unanticipated and unacceptable” 94.9%.

London said behavioral health was the biggest factor in Q2’s “step up” in medical costs, followed by home health and high-cost drugs. Elevance also called out increased use of behavioral health and emergency room services in its July 17 earnings call.

But one specific service in particular is hitting Centene hard.

London said applied behavioral analysis (ABA)—a therapy for people with autism and other developmental disabilities that provides positive reinforcement for desired social behaviors—was a growing contributor to the spike in care costs in multiple states, especially Florida.

Florida Medicaid previously covered ABA therapy on a fee-for-service basis, but on Feb. 1, started requiring the service be provided through Medicaid managed care plans.

Centene oversees one of the state’s nine managed care plans called the Children’s Medical Services Health Plan, which serves people under 20 on Medicaid with special healthcare needs. This program served nearly 123,000 people in 2024, according to state data.

London said this population “transitioned with inadequate rates” and Centene is seeking future and retroactive rate adjustments.

It’s not clear how much Centene will pay for ABA services, but the state expects to spend $2.6 billion on them in the current year, according to 

London went on to allege “fraud, waste, and abuse” is spiking in behavioral health, “partly because of the fragmented provider base.”

She said the company has formed behavioral task forces to push for behavioral health rate adjustments and educate state partners on how to ensure behavioral health treatments are quality and evidence-based.

Centene posts Q2 loss, spiking Medicaid costs

The company’s CEO identified this pain point in its Q2 earnings call.

Nicole Ortiz

The first year of a new presidential administration is always busy, but so far 2025 seems to have past years beat, as President Donald Trump has signed a record number of executive orders in just his first 100 days.

Now that we’re a little over halfway through the year, we wanted to look back on what has happened in the healthcare industry so far.

With a new administration comes the appointment of new department heads. That has included 

 being named secretary of the Department of Health and Human Services (HHS), 

 tapped to lead the Centers for Medicare and Medicaid (CMS), 

 as director of the National Institutes of Health (NIH), Marty Makary to run the FDA, and Susan Monarez to head up the CDC.

However, these departments also saw major staffing overhauls. The NIH saw top officials 

 in mid-February, with hundreds of layoffs following. HHS announced in late March it would lay off 10,000 employees—on top of 10,000 who had resigned already—which has impacted specific research areas like 

Across all agencies, funding has also been 

, impacting the industry from developing research to funding grants to keeping 

One of the concerns that came up frequently during RFK’s confirmation hearings was his past associations with vaccine disinformation and skepticism. Since taking over HHS, he has vowed to 

 that would analyze private medical records.

The spike in proliferating misinformation has public health and pharma experts 

. In particular, mRNA has come under fire (again), and some researchers are worried cuts might 

Previously, the Biden administration had also implemented a program that allowed CMS to negotiate drug prices directly with drugmakers. Trump took that a step further by signing an executive order that would 

 to be more in line with the lower costs other countries pay.

And speaking of more transparency around pricing, he also signed an executive order in late February that updated a ruling from his first administration, requiring hospitals to 

Before the election, experts were speculating about how Medicare and Medicaid 

Since cutting federal spending was a major goal of this administration, it perhaps comes as no surprise that one of the 

But, canceling out any potential savings made there, CMS announced in early April it would 

 average Medicare Advantage payments to 5.06%—a $25 billion increase—from 2025 to 2026.

Then on May 22, the House of Representatives passed a 

 that called for significant Medicaid cuts (nearly $800 billion, according to KFF) and a revamped 

, potentially leading to millions without insurance coverage. Before it was passed in the House, a report found that Medicaid cuts of this scale could lead to more than 

Across the board, diversity, equity, and inclusion (DEI) initiatives have been targeted by this new administration. Healthcare has been no different, with 

While Trump signed an executive order in late January to ban clinicians and defund institutions providing 

 for young patients, a legal expert told us the law 