This week, Trump administration officials announced their latest efforts to trim what they identified as duplicative and ineligible enrollees from government health programs. They tied the efforts to the administration’s broader crackdown on waste, fraud, and abuse — just as some states are opening polling stations for early voting.
The outcome of the midterm elections is expected to affect how and whether Congress addresses several healthcare issues during the lame-duck session, not the least of which is government spending. Plus, Health and Human Services Secretary Robert F. Kennedy Jr. unveiled a new initiative to identify vaccine injuries, complete with a ribbon-cutting ceremony at the National Institutes of Health.
This week’s panelists are Mary Agnes Carey of KFF Health News, Joanne Kenen of the Johns Hopkins Bloomberg School of Public Health, Sandhya Raman of Bloomberg Law, and Paige Winfield Cunningham of The Washington Sun.
Among the takeaways from this week’s episode:
Federal health officials this week pointed to their efforts to cut Affordable Care Act plan subsidies from people who were dead or found to have duplicate coverage under government health programs. While they were careful to say that these cases were not fraud, they tied their housekeeping activities to the Trump administration’s broader crackdown on waste, fraud, and abuse — and made that point just as some states are beginning early voting.
The outcome of the midterm elections is expected to shape how Congress spends its time during the coming lame-duck session, with benefits or repercussions for health policy. Should the Democrats win control of one or both chambers, for instance, the party’s leaders could push to hold off on tackling government spending until they have more clout next year. Among the issues on the table are changes to the No Surprises Act, which has shielded patients from many bills but also has come under criticism for problems with the arbitration system it created.
And Kennedy is pursuing a new initiative on vaccine injuries, opening a designated clinic at the NIH. The federal health department has also proposed reimbursing medical professionals for reporting vaccine-related injuries.
Also this week, KFF Health News’ Julie Rovner talks with Dan Weissmann, host of the healthcare podcast An Arm and a Leg, about the new and even more confusing landscape for Medicare enrollees as open enrollment begins.
Plus, for “extra credit” the panelists suggest health policy stories they read this week that they think you should read, too:
Joanne Kenen: On CBS News’ Face the Nation, host Margaret Brennan’s interview with Shyam Sankar, chief technology officer at Palantir. (Read the transcript here.)
After the third day of squirting an experimental drug up his nose, Dylan Meetze felt horrible.
“It was like I was underwater, like it took the most to do anything,” he said.
Meetze stopped taking the drug but endured fatigue and anxiety for months afterward, and his eyes and muscles twitched, he said.
He had taken BPC-157, a peptide drug popularized by podcasts about wellness, longevity, and what’s called “body optimization.” “Peptide” is a general term for substances that are smaller than proteins but composed of the same building blocks. Dozens of peptide drugs, including insulin and GLP-1 weight loss medicines, have garnered approval by the Food and Drug Administration. But BPC-157 and many others have not because they haven’t undergone clinical trials.
This fact hasn’t stopped online influencers from promoting them as remedies for muscle injuries, gut issues, covid, and more. Use of BPC-157 is growing in the U.S., particularly among white males, according to a new analysis of millions of de-identified electronic health records. Since 2020, the analysis, which hasn’t yet been published in a peer-reviewed journal, found that more than 1,000 people told doctors they had used the drug.
Meetze said he decided to take BPC-157 after listening to Andrew Huberman, a Stanford neuroscientist with more than 16 million followers on YouTube, Instagram, and TikTok, who talks up peptides frequently on his podcasts. Studies in mice suggest that BPC-157 helps muscles heal and has “very high safety profiles,” Huberman has said, “at least, with respect to the lethal dosing.” His guest on one episode, Craig Koniver, a doctor who sells peptides through his wellness clinic, called BPC-157 “super safe” and recommended it for “anyone who’s working out on a regular basis.” Koniver did not respond to requests for comment.
Huberman didn’t respond to multiple queries from KFF Health News, but an automatic reply linked to a disclaimer on his Huberman Lab website that says the podcast doesn’t constitute medical advice: “Any reliance on information provided through the podcast is solely at the user’s own risk.”
Hoping BPC-157 might help him advance as a weightlifter, Meetze said he bought the drug last year from an online vendor, Researchem. A chemical supply company with that name sells experimental peptides through its website, warning that the substances are “solely for laboratory research” and are “not intended for human consumption.” (It lists an address in Hillsboro, Oregon, that corresponds to a shared office space. A receptionist at the space said Researchem wasn’t registered there, and multiple queries from KFF Health News to the email address listed on the website went unanswered.)
Companies are required to warn that experimental peptides, which haven’t been approved by the FDA, are for research use only. But many companies may soon be permitted to drop the warning because of a push by health secretary Robert F. Kennedy Jr. to lower barriers to their use. He and other leaders of the Make America Healthy Again movement have promoted peptides as a way to improve the country’s health.
On the social media platform X, before he took the helm at the Department of Health and Human Services, Kennedy vowed to end the “aggressive suppression” of “peptides, stem cells, raw milk” and “anything else that advances human health and can’t be patented by Pharma.” (In fact, peptides are heavily patented.)
He has repeated the pledge since taking office. On Joe Rogan’s podcast early this year, Kennedy said he was a “big fan” of peptides and wanted to make many of them “more accessible.” On a podcast with the co-chair of the MAHA Action committee, Gary Brecka, Kennedy said the FDA’s role should be to assess science, “but not tell people and not tell physicians what they can and cannot prescribe.”
“If you want to take an experimental drug,” he added, “you ought to be able to do that.”
Health secretary Robert F. Kennedy Jr. spoke on the Joe Rogan Experience podcast in February, saying he’s a fan of peptides and has used them “on a couple of injuries.” (Clip from YouTube video)
This summer, Kennedy’s health department appointed doctors with financial stakes in the peptide industry to a panel that advises the FDA. At an FDA meeting in July, the new appointees voted to ease restrictions on six experimental peptides, including the trendy compounds BPC-157, TB-500, and MOTS-c. Specifically, they advised adding these peptides to a list, called 503A, that would allow specialized pharmacies to make the drugs for human use, even though the FDA hasn’t approved them.
In an email, HHS spokesperson Emily Hilliard wrote that every committee member satisfies the FDA’s ethics requirements. “FDA — not podcasts or politics — determines which substances qualify for inclusion on the 503A Bulks List,” she wrote. The FDA has yet to issue a final decision.
The vote went against FDA scientists who presented research on the six peptides, concluding there wasn’t enough evidence to show they improved any condition. Furthermore, the scientists highlighted a potential for liver damage, allergic reactions, or other serious consequences.
“People are saying this is about medical freedom — putting decisions back in the hands of patients,” said Reshma Ramachandran, a regulatory science researcher at Yale School of Medicine. “But what we see in practice is that incentives aren’t actually centered around patients. They’re centered around selling products.”
Scientists also warned that drugmakers would be reluctant to invest millions of dollars into clinical trials on peptides if they could be sold without FDA approval.
“The chances of clinical trials getting done now are diminished,” said Eric Topol, executive vice president of Scripps Research, a biomedical science institute in San Diego. “We will have more people who are prey to predators that will sell, sell, sell.”
A lack of data leaves consumers in the dark.
Meetze sought help on Reddit, where people post about pain, headaches, vision problems, and a lack of motivation after taking experimental peptides. Peptide enthusiasts often comment on these posts with skepticism, attributing a person’s problems to contaminated products, preexisting conditions, or misuse of the drugs. The online vitriol in the Reddit conversations can be intense, so Meetze welcomed an invitation to join a private group on the social platform Discord in which people with BPC-157 side effects tried to figure out what happened to them and how to fix it.
“There are millions of success stories with these peptides,” Meetze said, “but no one wants to believe that this wrecks some of our lives.”
Experimental peptides are often sold at longevity, wellness, and “performance medicine” clinics — even though they haven’t been proved safe and effective in clinical trials. (Amy Maxmen/KFF Health News)
Wolverines and Migraines
One member of the private side-effects group, a 46-year-old software engineer named Dominik E., said he got an excruciating migraine within days of taking BPC-157 with TB-4, another unapproved peptide — a combination called the “Wolverine Stack” because of its purported ability to heal wounds rapidly, like its namesake Marvel superhero.
“My left eye started throbbing really badly, and the left side of my face became numb,” he told KFF Health News, which agreed to only partially identify him and others interviewed for this article who were concerned about divulging sensitive health information.
After two months of migraines, Dominik said, the pain eased, but his face felt inflamed. “It is a total nightmare,” he said.
“I’m afraid how people will judge me,” said Lois S., a woman who works at a Michigan elementary school. She hoped BPC-157 and another unapproved peptide, retatrutide, would help with weight loss, but she stopped taking the treatment when she felt pain.
“I sought out this substance from a lab that clearly labeled it not for human use, purchased a syringe, and injected this in my kitchen,” she said. “That belies all logic about what a normal person would do.”
Peptide proponents argue that shoddy manufacturing — not the peptides — causes harm. Therefore, they say, the FDA must protect the public by allowing doctors to prescribe peptides made for human use by pharmacies that specialize in compounding medicines. Typically, compounding pharmacies manufacture alternatives to FDA-approved drugs so a patient can, say, get a liquid version of a drug that the original manufacturer makes only as pills.
Adding unapproved peptides to the FDA’s list of compoundable drugs would mark a departure from the list’s purpose, said Peter Lurie, a former FDA official who now directs the advocacy group Center for Science in the Public Interest. He noted that federal and state oversight for compounding pharmacies is often lax, and they’ve been cited for contamination.
Furthermore, he added, the move would mislead consumers into thinking they’re buying drugs backed by clinical trials. People promoting peptides often point to promising laboratory research as evidence. Rats with spinal injuries regained tail mobility after BPC-157 injections, for example, and old mice given the experimental peptide MOTS-c could run longer. On average, however, fewer than 10% of substances that show promise in animal studies prove effective in clinical trials.
“A lot of this pseudoscience stuff sounds deeply impressive — inflammation this and telomere that — but at the end of the day, none of it really matters,” Lurie said. “You’ve got to show clinical benefit in humans: Does it work?”
Peptide promoters lean on anecdotes, often without verifiable numbers. In a podcast recorded at the White House, the MAHA influencer Brecka said: “Twenty million people have been prescribed these things without adverse events.” His guest on the episode, Brigham Buhler — who is the co-author of The Peptide Revolution and owner of a compounding pharmacy that sells peptides and a clinic, Ways2Well, that prescribes them — told Brecka that none of its 75,000-plus patients had reported adverse events from peptides.
Buhler cited even higher numbers in the movie MAHA Uncensored, a documentary featuring Kennedy and other leaders of the MAHA movement and that bears the MAHA trademark. In the segment on peptides, Buhler said: “Having treated literally hundreds of thousands of people through our compounding pharmacy, we’ve never had a major adverse event.”
Topol asks why those boasting success haven’t conducted clinical studies. “If influencers and companies really believe these peptides are helping people,” Topol said, “then they should put their profits back into rigorous research.”
Chris Woodward, a spokesperson for Brecka and his company, the Ultimate Human, said in an email that the health and wellness issues discussed on Brecka’s podcast do not constitute medical advice. “Mr. Brecka consistently advises his audience to consult a licensed physician,” Woodward wrote. Buhler did not respond to requests for comment.
On an episode of his Ultimate Human podcast recorded in the White House, Gary Brecka, a co-chair of the MAHA Action committee, promoted peptides that haven’t been approved for safety and effectiveness by the FDA.
Not all anecdotes are rosy. At an antiaging conference last summer in Las Vegas, two women were rushed to the hospital and intubated after being injected with experimental peptides and vitamins, according to citations that Nevada’s state pharmacy board issued against the doctor running the booth and his colleagues for prescribing and administering drugs without a state medical license.
An FDA database for adverse events contains concerning reports. Although the database can’t prove that a drug, vaccine, or medical device caused harm — the reports are brief, unverified, and voluntary — it signals issues worth exploring. A 36-year-old woman was hospitalized in December after taking the experimental peptide BPC-157 for weight control and a skin disorder, for example, and a 48-year-old man was hospitalized with a “life-threatening” condition after taking the peptide.
FDA scientists presented some of these reports at the July meeting and flagged worrisome outcomes in animal experiments, such as a 2020 study revealing signs of liver toxicity in rats and dogs injected with BPC-157.
Brian Lee, a liver disease specialist at the University of Southern California, was among the panel’s minority who voted against easing restrictions. Without clinical studies, he said, afflictions that take time to develop, like liver damage and cancer, might not be spotted for years: “I think this endorsement can be potentially harmful, and I cannot in good conscience vote ‘yes.’”
The panel’s newcomers disagreed. “I do not believe the FDA made a good case on issues with safety with BPC,” said Kris Wusterhausen, founder of an antiaging company in Texas, the Resurge Clinic, which sells a BPC-157 product for $149.
“Once you’ve seen the effects of BPC,” he said, “you can’t unsee it.”
At an FDA meeting in July, Brian Lee, a liver disease specialist at the University of Southern California, voted against easing restrictions on the experimental peptide BPC-157, citing safety concerns.
Awaiting Trial
Deepak Srivastava, president of the Gladstone Institutes in San Francisco, designed a clinical trial two decades ago to see if a peptide he studies, TB-4, could repair tissue after a heart attack. Before enrollment, people volunteering for the study would be screened for early signs of cancer because TB-4 triggers vessel growth and cell migration, which might exacerbate malignant growths. He worries about the FDA panel’s vote to ease restrictions on a derivative of TB-4, before such trials have been completed, saying, “You need to have a healthy respect for the fact that drugs can be harmful.”
Pinchas Cohen, a peptide researcher at the University of Southern California, was less cautious, saying the FDA buzz might drive investors to fund trials. He’s seeking support to bring a peptide his lab identified, MOTS-c, to market. It’s “un-ideal” for people to take unproven drugs, Cohen said, but that’s what’s happening: “The world is changing and people like me need to accept that this is the new reality and find ways to make it as safe as possible.”
In the meantime, people like Meetze resort to podcasts and online forums for advice. His symptoms faded after a year, but he still had spells of feeling “zero emotions.”
Peptide users describe this condition as anhedonia. It’s come up on Huberman’s podcasts.
Huberman occasionally mentions other potential peptide risks, like cancer, sprinkling them into advice on how to take them. Take a 2024 episode with 1.2 million views: “I do not think that BPC-157 is not without its quote-unquote ‘side effects,’” Huberman says. “If you’re going to go down this path of taking BPC-157, I would encourage you to take the minimal effective dose, to not simply do it every day, and certainly to not do it continuously, and of course to monitor your other health metrics for anything that could potentially resemble cancer or tumor growth, because obviously stimulating angiogenesis for wound repair sounds like a great thing, recovering and being able to do your workouts or play your sport, or move about more comfortably, of course, a wonderfully attractive thing to do.”
“Isn’t that what we all want? But obviously not with the trade-off of growing a tumor,” he said, before interrupting the discussion to advertise a supplement company sponsoring the show.
A cadre of elite techies, financiers, and high-level Trump administration officials have spent a year quietly charting an extraordinary and rapid campaign to persuade Americans to use apps and other artificial intelligence-powered tools to manage their healthcare and medical records.
As that campaign has unfolded, administration officials have granted tech companies an unusual opportunity to nudge the nation’s health department toward a loosely regulated future for AI health apps in which the government reimburses them for services as it does medical professionals.
In February, federal health officials invited those businesses — including tech giants Microsoft, Anthropic, OpenAI, Apple, and Google — to a listening session on conversational AI products for patients, such as chatbots. Representatives from at least 35 industry organizations attended the meeting held by the Food and Drug Administration, which is responsible for regulating health apps as medical devices. Companies were prompted in advance to explain their AI products and how they access patients’ sensitive medical information.
But the meeting did not appear on the FDA’s public calendar or regulatory notices, nor was the public invited. Rather, the invitation for a select group to help shape federal policy governing AI in healthcare was extended in a chat room on the messaging service Slack.
“This is a great opportunity to support HHS’ goals and share your state-of-the-art understanding of safe Conversational AI development and monitoring to help FDA shape future guidance,” CMS senior policy adviser Morgan Taylor wrote in the Slack workspace.
The Centers for Medicare & Medicaid Services has not formally announced the chat room through federal regulatory channels, though CMS officials have talked about it at industry conferences. Legal experts said the chat room resembles a federal advisory panel, which would be required to operate in public view.
KFF Health News reviewed thousands of Slack messages, meeting transcripts, and video recordings that reveal how the Trump administration has granted the industry a direct line to top government officials — including former head of the Department of Government Efficiency Amy Gleason.
The conversation took place behind the scenes as federal health officials publicly worked to integrate AI and other technology into nearly every aspect of healthcare, a plan they’ve branded the “Health Technology Ecosystem.”
“We wanted to give industry a chance to play in the sandbox of government-supported healthcare,” CMS Administrator Mehmet Oz said in September at the public launch of an initiative that allows health apps to bill Medicare for AI services such as wearable device tracking. Last week, Health and Human Services Secretary Robert F. Kennedy Jr. delivered an enthusiastic endorsement of AI in healthcare, claiming it is “much better informed than any doctor in the country.”
Meanwhile, HHS staff even promised that a recently launched Medicare App Library would serve as a lucrative pipeline for those businesses to get new users. The library’s webpage currently promotes only two dozen commercial apps to millions of American seniors and those with disabilities.
As Trump officials sell it, Americans will get easier access to their medical records so apps can swiftly provide health or wellness advice. In practice, however, so will the tech companies.
Doctors, meanwhile, are increasingly worried about how patients use and share their medical records with the nascent technology.
“Some of these tools just aren’t ready for primetime,” said John Whyte, CEO of the American Medical Association. “We don’t have enough data about them. We don’t understand how they work, how they’re using the information. There’s no liability if these tools get things wrong.”
CMS officials declined to answer several questions about the Slack workspace, including about its legality.
“CMS is focused on giving Medicare beneficiaries greater access to their health information and useful digital tools while promoting an open, interoperable healthcare system,” Gleason, now chief product officer for the newly created Office of Health Technology and Products at CMS, wrote in an emailed statement. “The Health Technology Ecosystem is an open, voluntary technical collaboration. CMS will continue working with patients, providers, payers, technology organizations, and other stakeholders to make health information more accessible and useful to the Americans it serves.”
The FDA did not respond to a request for comment.
The Conversation Begins
The behind-the-scenes effort to funnel more Americans to AI-powered health apps began in August 2025 in the Slack workspace.
“Welcome all!” Gleason wrote. “Please be sure to read the Code of Conduct and see the Channel list as well to help you find channels that are relevant to you.”
Gleason is best known for serving as the acting administrator of Elon Musk’s Department of Government Efficiency, as it gained access to millions of Americans’ sensitive personal and financial data, including at the Social Security Administration.
As her work with DOGE wound down last year, Gleason welcomed a variety of tech leaders, investors, and entrepreneurs to the chat room.
Documents have been reproduced from the CMS Health Tech Ecosystem Slack and highlighted by KFF Health News.
The Slack workspace’s participants include representatives from major digital wellness companies like Oura Health, AI companies like Palantir, and investment outfits like 8VC, a venture capital firm associated with Kennedy’s son Finn. While the Slack’s member count has ballooned to 1,700 over the past year, only a handful of patient advocates, doctors, and hospital representatives are in it.
The code of conduct Gleason shared on Slack in August 2025 documented that CMS had quietly established a technology working group.
The document also set ground rules for the Slack workspace, noting that the group does not constitute an “advisory committee,” nor would it be used “to obtain advice or recommendations for HHS, CMS, or any HHS/CMS officials.” The code also advises that federal employees “are prohibited from endorsing any product, service, or enterprise.”
Joseph Daval, a former FDA lawyer who is now a research specialist at Harvard Medical School, reviewed messages from the Slack workspace at the request of KFF Health News. He said the chat room in some ways resembles a federal advisory committee — an independent panel that can be formally stood up by an agency head, Congress, or the president to ensure agencies act in the best interest of the public rather than industry.
The law on advisory committees “was passed in part out of a concern about interest group capture, about anticompetitive capture of agency policymaking, about corruption,” he said.
Daval said the chat group looks like a committee, with members interacting with one another and building consensus on preferred courses of action.
If it were a formal advisory committee, though, Daval said, it would be subject to certain “membership requirements having to do with independence and fair balance.”
A ‘Sales Engine’
Over a series of video calls, CMS officials promised tech leaders participating in the Slack workspace that the agency would promote their health apps.
Jacob Shiff, the chief AI and technology officer at CMS’ Innovation Center, told industry representatives in a Zoom meeting in February that he hoped the agency’s work would be a “sales engine” for the health apps.
“We’re going to have a directory of all the organizations,” Shiff said in a video recording reviewed by KFF Health News. “The people on this call who hopefully will have amazing solutions that work will be the winners, and you have every incentive to obviously drive down your costs so you can be extremely profitable and scale. So hopefully we’re selling — or enabling you guys to thrive.”
This video recording was captured and excerpted by KFF Health News before it was removed from public view.
A recording of the call had been publicly available through a Google Drive link but was made private the day after KFF Health News asked about comments made during the meeting.
CMS did not respond to queries about how the agency has decided which AI-powered health apps appear in the Medicare App Library or why federal employees have promised to promote the products.
Days before publicly launching the Medicare App Library, CMS officials promised AI tech leaders during an informal meeting that the new webpage would become an important distribution channel for health apps because Medicare enrollees would place trust in products listed on the CMS website.
“If medicare.gov is promoting it, for lack of a better word, then yeah, it would be an app that I would trust and explore,” CMS’ Taylor said during the April 7 meeting, channeling enrollees, according to a transcript of the call.
The Medicare App Library’s webpage encourages older and disabled Americans to manage health conditions such as obesity, cancer, or diabetes using two dozen AI-driven apps developed by some of the world’s largest corporations, including Microsoft and Google. Many of the apps promise in their product descriptions to give insight, perform analyses, or develop plans that will help patients lose weight or manage diabetes.
CMS officials have suggested to tech representatives during at least two meetings this year that those apps will be prioritized for a new agency program that reimburses companies for AI chatbot advice or wearable device tracking, according to video recordings.
CMS has not publicly divulged all the criteria it uses to decide which apps are listed in its library, but the webpage promotes apps still in their infancy.
Among them is Slothwise, a health app launched this year from a San Francisco apartment by a young, self-described biotech entrepreneur and triple citizen of Russia, Israel, and the U.S. The app says it “knows your whole health” by analyzing medical records and tracking health data for $9.99 a month. It has been reviewed on the Apple and Google app stores only a handful of times.
“I trusted slothwise with my health info because it was endorsed by medicare,” one reviewer wrote in a Google review in August. “Connecting info was smooth and I learned a lot about my health.”
In a statement, Slothwise CEO Sofia Sigal-Passeck did not answer questions about the size and medical expertise of her current team, nor about the availability of a doctor to consult with patients who use the app. The app, she said, is only “informational” at this time.
“I’ve spent years building at the intersection of AI and complex biological data,” Sigal-Passeck wrote in an email. “A small team is not the same thing as an inexperienced team. Slothwise is built by physicians, PhD researchers and engineers.”
‘No Regulation, No Rulemaking’
What’s often less clear — and buried deep in lengthy privacy policies — is that these apps are tapping into the intimate details of patients’ medical records to fuel their AI-driven analyses.
Tech vendors have lobbied the government to treat these apps, once they are vetted and authorized by a third-party organization, like a patient requesting records. That position gives apps sweeping access to pull sensitive health data from the national network through which providers electronically exchange medical records, called the Trusted Exchange Framework and Common Agreement, or TEFCA.
A small but influential group of those tech company executives directly made the case to federal health officials during a formal meeting in May, arguing that when health apps request medical records they should be treated as if they are standing “in the shoes” of a patient.
On Slack, tech vendors have lobbied for a “frictionless pathway” for verified users, after they’ve consented once, that allows the app to gain limitless access to patients’ medical records from the TEFCA network.
Ryan Howells, a healthcare management consultant who lobbies for a Washington, D.C.-based digital health tech organization called the CARIN Alliance, has spearheaded an effort for patients — vis-à-vis apps — to more easily access medical records. He has regularly noted in Slack that health apps accessing TEFCA must be vetted by a third-party organization — one of which he sits on the board of — and agree to a code of conduct, developed by the alliance he lobbies for.
“What more can you do to have trust in these apps?” he wrote in a March Slack message, responding to concerns about how much patient consent is needed for apps to access medical records on the network.
Kristen Valdes, the CEO of b.well, a company that also connects apps to the TEFCA network, made a similar argument.
“My opinion is that we need to stop protecting patients from themselves,” she wrote in the same message thread. “Full stop.”
Howells did not respond to an emailed list of questions from KFF Health News. In an interview, Valdes told KFF Health News that her comment reflected her frustration at the “paternalism” of the healthcare system, which she said has historically made it difficult for patients to access their records. Although, she said, “there are going to be good and bad apps.”
Other tech leaders worried in Slack about the approach.
One startup founder cautioned the group to think about the pitfalls of giving health apps broad leeway to pull medical records.
“We might all be good, honest actors here but security & privacy systems have to be designed around the presence of malicious actors – especially if we want this system to scale up to thousands of apps,” wrote Jason Kulatunga, who runs Fasten Health, a medical records management platform.
Gleason, the CMS official, has publicly championed the vision shared by Howells and Valdes. In her speeches, she frequently urges doctors to accept patient medical records directly from apps and calls on them to “Kill the Clipboard,” also the title of a 2025 white paper co-authored by Howells that urges doctors’ offices to abandon paper records.
Last month, Gleason spoke to a crowd gathered at a swanky hotel in Washington for an event hosted by the MAHA Institute, a think tank that supports Secretary Kennedy’s agenda. She laid out her work with tech companies over the past year as she discussed the Trump administration’s efforts to make medical records more digitally accessible.
As she told it, more Americans can now download an app and access their medical records.
“Once you’ve verified your identity you can just click a simple button and say, I’d like my medical records into whatever app I choose,” Gleason said.
She continued: “That was all done just — no regulation, no rulemaking — just by challenging industry to work together.”
Mulligan is the chief economist and chief regulatory officer at HHS.
Some Medicare patients owe more in coinsurance than the hospital paid for their drug. That arithmetic sounds impossible. It is a consequence of the 340B drug discount program and Medicare’s payment formula. Now the Department of Health and Human Services, where I work, is proposing to narrow that gap.
Congress created the 340B drug discount program in 1992 to financially support safety net hospitals that serve low-income patients. Drug manufacturers must give them steep discounts. But Medicare, Medicaid, and commercial insurers generally reimburse them at the full amount, allowing these hospitals to keep the spread above the discounted purchasing costs.
A new report from the Department of Health and Human Services shows other unintended consequences of this well-intended program. The spread grows with the price of the drug. It therefore rewards hospitals for using more and costlier drugs and makes physician practices and infusion clinics more valuable after a 340B hospital acquires them. The patient’s treatment needn’t change. The owner and billing site do.
The 340B program has exploded: Eligible drug purchases rose from $12 billion in 2015 to $81 billion in 2024, mostly at hospitals, as shown in the report. Those purchases are now larger than net Medicare Part B and Medicaid drug spending overall and, among public prescription drug programs, are smaller only than Medicare Part D.
A 340B hospital that buys another hospital or a physician practice can register more off-campus clinics and contract pharmacies and capture more spread. Hospital off-campus clinic sites grew from about 7,000 in 2013 to more than 34,000 in 2023, often in neighborhoods that are wealthier and better-insured than that of the parent hospital. Contract pharmacies grew from roughly 1,300 in 2010 to more than 31,000 by mid-2026, dominated by the largest chains.
With greater bargaining power after acquisitions, hospital systems can negotiate higher commercial prices for health care services, which can in turn raise premiums. Newly acquired hospital outpatient sites can also add facility fees to non-drug services. The effects of 340B show up as larger, more expensive hospital systems and a bigger bill for patients, employers, and taxpayers. The program’s ripple effects contribute to the broader problems facing the U.S. health care system.
Medicare payment for Part B drugs is typically based on average sales price (ASP). Beginning in 2018, the first Trump administration narrowed the spread in Medicare by paying hospitals for 340B drugs’ ASP minus 22.5% rather than the usual statutory standard of ASP plus 6%, based on an earlier estimate of their average minimum discount.
Overall outpatient drug payments rose nearly 15% a year from 2015 through 2017. Once the lower rate was fully in effect, inflation-adjusted payments largely plateaued. Payments for the affected 340B drugs held near $7 billion from 2019 through 2021. It is clear that Medicare payment policy influences outpatient drug spending.
The Supreme Court ruled in 2022 that HHS couldn’t vary payment rates by hospital group without first conducting the acquisition-cost survey required by statute. The court didn’t find that hospitals were economically entitled to the markup. It found that HHS lacked a procedural prerequisite. After the lower rate ended and ASP plus 6% returned for these drugs, annual payments for the affected drugs rose from $7.1 billion in 2021 to $10.7 billion in 2023 — a $3.6 billion increase. Overall outpatient drug payments rose from $14.3 billion in 2021 to $17.6 billion in 2023.
Restoring the higher rate meant paying hospitals more for the same drugs. The $3.6 billion increase combines that direct payment effect with induced changes in hospitals’ dispensing quantities and drug manufacturers’ underlying prices. The larger spread also strengthens hospitals’ incentive to choose costlier drugs and move treatment into 340B billing sites.
Off-campus hospital departments benefited too. From 2021 to 2023, payments for their affected 340B drugs rose about $800 million even as claims fell and the number of beneficiaries remained similar. Although these amounts do not tell us how many practices hospitals acquired because of the markup, they indicate the additional financial incentives for acquisitions.
On April 18, 2025, President Trump directed HHS to obtain the cost information the statute requires. CMS surveyed hospitals from January through April 2026 and has proposed paying for affected 340B drugs at ASP minus 33.4% in 2027. CMS estimates that Medicare drug payments would fall by $4.55 billion in the first year and beneficiary drug copayments by $1.15 billion.
For a drug with an ASP of $1,000, a beneficiary’s standard 20% coinsurance would fall from $212 to $133.20. The prescription hasn’t changed. The patient’s share of the hospital’s bill has. Narrowing the spread also weakens the incentive to steer patients toward costlier drugs and to acquire physician practices and infusion clinics — the very behaviors that have made care more expensive.
There’s an important lesson here. A small, well-intended discount for safety net hospitals became a large institutional subsidy with expensive unintended consequences. Under the proposed rule, hospitals would still receive their 340B drug discounts. What would change is Medicare’s payment for those drugs at affected hospitals. Congress provided for a survey of hospitals’ acquisition costs, and CMS says its proposed rate would “more accurately align Medicare payments with hospital drug acquisition costs.”
Medicare patients should not pay coinsurance as though the discount did not exist.
Casey B. Mulligan is the chief economist and chief regulatory officer at HHS.
Bob Herman is the author of Health Care Inc., an award-winning weekly newsletter about the business of health and medicine.
Bob covers the money in health care, focusing on health insurance and hospitals. His stories delve into Medicare Advantage, opaque prescription drug benefits, and how much executives actually make. He is also the author of the Health Care Inc. newsletter. You can reach Bob on Signal at bobjherman.09.
The Trump administration released new regulations Monday that will force health insurance companies to publish cleaned-up spreadsheets of the prices that they pay hospitals and doctors, while stripping out meaningless data that clogged up the files.
Trump officials also said they will start developing the system for disclosing prescription drug prices next month. A “hopeful” final plan for drug pricing data will come out by next May, said Mehmet Oz, the head of Medicare and Medicaid, at an event Monday. The government will enforce those requirements by the end of 2027.
Bob covers the money in health care, focusing on health insurance and hospitals. His stories delve into Medicare Advantage, opaque prescription drug benefits, and how much executives actually make. He is also the author of the Health Care Inc. newsletter. You can reach Bob on Signal at bobjherman.09.
WASHINGTON — The Department of Health and Human Services announced a set of new initiatives aimed at speeding up clinical trials by incorporating more artificial intelligence and computational models and moving away from sharply delineated trial phases.
The centerpiece five-year program, dubbed SURPASS — “Simulation-augmented, Real-time Platform Adaptive Seamless Trials” — will kick off later this fall by accepting “ground-breaking ideas from cross-disciplinary teams in statistics, AI, and clinical trial design, operations, and regulation,” reads a website about the program.
HHS is launching the program through the Advanced Research Projects Agency for Health. The initial announcement did not note how much funding was designated for the new initiatives, nor did it provide details on whether participants would be offered more flexibility or resources.
WASHINGTON — The Make America Healthy Again movement wants your health data.
The MAHA Institute, a think tank formed by allies of Robert F. Kennedy Jr. after his appointment as health secretary, held an event on Monday that emphasized the benefits of opening up health data sharing in the United States. In particular, the event highlighted how sharing patients’ health records with federal researchers could benefit the study of the origins of chronic diseases.
In a speech at the event, Kennedy said that user agreements restrict access to data, giving “institutions that control important health data the power to decide who can study it and what questions they’re allowed to ask, and that creates protectionism in science and it leads to the politicization of science.”
“A qualified researcher with legitimate hypotheses should not need permission from a gatekeeper to test it, particularly from an industry gatekeeper,” he said in his remarks, which began and ended with a standing ovation.
The idea of using data from health information exchanges for research is controversial because of privacy concerns.
Speakers throughout the day brought up the state of Nebraska’s partnership with the federal government. As reported earlier this year by KFF Health News, Nebraska’s health information exchange network, called CyncHealth, is sharing patient data with the federal government to enable studies on vaccines and autism.
Kennedy said Monday he wants to aggregate “immunization records, clinical data, laboratory results, pharmacy information, and claims to create a more complete picture of a patient’s health over a long period of time.” That data would come from state health information exchanges, EHRs, laboratories, Medicare, Medicaid, and commercial health data platforms like HealthVerity.
“We’re already using all these data to answer some of our most important questions. Too much remains fragmented, vulcanized, difficult to link, and inaccessible to researchers,” he said, citing a desire to aggregate the data and make it available to all researchers.
While KFF reported Nebraska’s partnership was with the Centers for Disease Control and Prevention and focused on vaccines and autism, MAHA Institute President Mark Gorton said a partnership between Nebraska and the National Institutes of Health “has successfully produced data for the study of chronic disease and serves as a proof of concept for the state-federal hybrid model.” Neither partnership seems to have been publicly announced, though the NIH has already stood up an effort to build Medicare and Medicaid databases within the NIH in an effort to better understand autism.
Nebraska’s CyncHealth was, until the end of last year, led by Jamie Bland, who became chief data strategist of the MAHA Institute in April.
At the time of KFF’s reporting, leaders of other state health information exchanges decided not to share information with the government. Using such data for research could run into patient privacy, ethics, and legal issues.
For example, Jonathan Ketcham, who was chief health care economist at the White House until earlier this year, when he moved back to his economics professorship at Arizona State University, said on Monday that Arizona’s health information exchange data “cannot be used, even de-identified, for researcher grants without individual consent” from providers.
“The issue is not a technical limitation,” Andrew Kress, CEO and founder of data company HealthVerity, told STAT last year. “It’s really been more around data governance, data ownership, data privacy. Those are the reasons that these things have not worked, more so than you can’t find the right data to do it.” Hospitals, for example, sometimes sell their patients’ de-identified data, or carefully grant access under data use agreements that spell out what purpose the data can be used for. Patients also normally have to consent to their information being used for research.
Gorton said that the partnership with Nebraska has only worked “because of the investments that Nebraska has made in data governance.” “If this model is going to expand, we will need to see other states make similar investments in the mundane yet crucial function of data governance,” he said.
The administration has sought to give patients more control over their own data through initiatives like the CMS Health Tech Ecosystem. “Liberate patient records,” said top HHS official Chris Klomp at a STAT event in March. “Let us be very clear on CMS’ official position on this: The record belongs to the patient. It goes everywhere the patient needs to go. We’re serious about this.”
But the improved health data infrastructure from these and other Trump administration efforts would help standardize health data, making it ripe for helping answer research questions.
“We’ve had a lot of public controversy about vaccine safety,” said Donald Rucker, chief strategy officer at 1upHealth and national coordinator for health IT during the first Trump administration. “Many of the [health information exchanges] could answer these questions right now if the immunization registries weren’t actually unlinked to the HIEs,” he said.
Gorton said at the event that the partnership with Nebraska is a model for state-federal cooperation on health data, and that all 50 states will try different approaches to “growing America’s health data infrastructure.”
“With these successes, residents will experience health data record portability and a better healthcare experience. Once citizens experience what is possible in one state, other states will rush to follow,” said Gorton. “This pilot is just one small step on a long journey, and we are excited to be part of this adventure.”
