House and Senate Recessed Until September. With both chambers recessed, all eyes will be on government funding negotiations when lawmakers return. Current funding is set to expire at the end of September, and the outlook for a full-year appropriations deal remains uncertain. With deep divisions over spending levels and policy riders—particularly in healthcare—Congress may consider a short-term funding bill to avoid a shutdown. While there is some discussion around a healthcare package to accompany a government funding bill, those policies will likely be subject to the broader political environment. A4H continues to assess opportunities to advance accountable care policies as part of these conversations.

New Rural Health Transformation Program Could Boost VBC. Republicans’ reconciliation bill includes a new five-year, $50 billion funding program designed to help states invest in rural health care systems. The Rural Health Transformation Program (RHTP), also referred to as the “rural health fund,” will disburse funding to states over five years, starting in 2026. States will apply for funding and program funds must be used for three or more specific uses outlined in the law, which includes developing innovative models of care, specifically including value-based care arrangements, and other applications well-suited to the advancement of accountable care, including promotion of evidence-based interventions to prevent and manage chronic disease, training and assistance on technology tools like remote patient monitoring, supporting access to behavioral and mental health, and more. Per the law, the agency is required to make approval decisions on states’ applications by December 31, 2025. A4H expects to see additional guidance from the agency in September.

CMS Finalizes TEAM Changes, Pay Boost, and Other Policies in IPPS/LTCH Final Rule. CMS issued the FY2026 Inpatient Prospective Payment System (IPPS) and Long-Term Care Hospital (LTCH) final rule, implementing an increase of 2.6 percent to the IPPS payment rate for hospitals and an increase of 2.7 percent for LTCHs. Additionally, the rule finalizes changes to the Transforming Episode Accountability Model (TEAM), including provisions related to the use of patient-reported outcomes for quality performance, target price construction, and the three-day Skilled Nursing Facility waiver. CMS also provided an overview of responses to a Request for Information on Medicare digital quality measurement and finalized the ASTP/ONC’s HTI-4 rule, which is intended to advance providers’ ability to engage in electronic prescribing, real-time prescription benefit checks, and electronic prior authorization. A fact sheet on the final rule can be found here.

Health Affairs: Fee-For-Service, Accountable Care Organizations (ACOs), And Medicare Advantage (MA): Why? A recent Health Affairs article discussed the challenges that Medicare faces and the potential role that financing models such as fee-for-service, ACOs, and MA can play in meeting those challenges. The article points to existing evidence demonstrating the potential for well-designed ACOs and capitation to change care delivery and deliver savings. Author Michael Chernew also comments that although ACOs have taken time to develop, ACOs show potential to outperform fee-for-service and further refinements to build on past successes are important.

Congressional Hill Briefing on Kidney Care, October 21: Join A4H and C-TAC for a discussion with experts in health care, policy, and patient advocacy for a briefing on Improving Care for Patients with Kidney disease. The meeting will take place at the Rayburn Office Building, Room 2060 from 12pm to 1pm. Register here.

Virtual Value-Based Payment Summit, September 3-5: Register for this online event that will bring together CMS leaders, organizations, stakeholders, and policymakers to discuss value-based care initiatives. Confirmed speakers are listed here.