IHA Daily Briefing: June 2

CMS Updates Kidney Transplant Rules, Adds MA to Medicare Risk Payment Calculations
The Centers for Medicare & Medicaid Services (CMS) issued a final rule making changes to the second performance year of the Increasing Organ Transplant Access (IOTA) Model, beginning July 1, 2026 and for future performance years. Beginning last July, IOTA is a six-year mandatory model for certain kidney transplant hospitals.

CMS' final rule contains changes for the IOTA model's participant eligibility, risk adjustment methodology, transparency, performance quality, and a health equity plan component, including:

• Increasing the low-volume threshold from 11 kidney transplants performed annually during each of the baseline years to 15, regardless of payer type, excluding military medical treatment facilities and VA medical facilities as defined at § 512.402;

• Adding Medicare Advantage (MA) patients in the calculation of upside and downside risk payments, which currently only includes Medicare fee-for-service patients.

• Maintaining the maximum upside risk payment of $15,000, rather than lowering the payment to $10,000 as proposed.

• July 1, 2027, notifying patients semi-annually of changes in waitlist status, if they've been on the waitlist for at least three years. Waitlist patients must also be notified of a status change within 10 days when they become ineligible for organ offers.

• Developing a risk adjustment methodology for the model's sole performance-based quality measure for participating hospitals (composite graft survival rate) to be consistent with the national Scientific Registry of Transplant Recipients (SRTR) framework, which previously had none. Feedback follows the proposed rule, a July 2025 request for information, and a March 2026 update from the Health Resources & Services Administration on the SRTRs work and future direction.

• Removing a voluntary health equity component, permitted for submission under the current model.

In addition to the final rule, major updates to the IOTA model can also be found within CMS' quick reference.

Staff contact:

Spring Session Update
The Illinois General Assembly adjourned the 2026 Spring Legislative Session in the early morning hours of June 1. The final days of session were marked by long hours, with a number of significant bills not finalized until the last moments of the session, including the Fiscal Year (FY) 2027 operating and capital budgets, the FY 26 supplemental and omnibus packages on revenue and Medicaid. The General Assembly also approved AI and social media regulations, insurance reforms, a cell phone ban in schools, cannabis and hemp policies, and efforts to unionize ride share drivers.

In total, 395 bills passed both chambers this year, including 229 House bills and 166 Senate bills. The General Assembly has 30 days to send legislation to the Governor's desk after its passage. Upon its receipt, the Governor has 60 days to take action on the bill. If he does not act within that time frame, the legislation automatically becomes law.

Several big-ticket items did not cross the finish line. The General Assembly did not pass legislation authorizing mega projects incentives, which included the effort to move the Chicago Bears to Arlington Height. Also failing to advance during the spring session was an overhaul of public university funding, community college baccalaureate degree authorization, a Tier 2 pension overhaul, and data center regulations. These initiatives could be revived during the fall Veto Session, or during the 2026 spring legislative session. The fall Veto Session has been scheduled for Nov. 17-19 and Dec. 1-3.

CMS Issues Interim Final Rule on Medicaid Community Engagement Requirements
The Centers for Medicare & Medicaid Services (CMS) yesterday issued an interim final rule with comment period implementing a new statutory requirement for certain adults in Medicaid to meet an 80 hour per month work requirement, also referred to as community engagement requirements, as a condition of eligibility. Under the rule, certain adults must complete 80 hours per month of "qualifying activities," such as employment, education, community service or participation in a work program, or meet equivalent income thresholds. The Illinois Dept. of Healthcare and Family Services (HFS) initially estimated there will be approximately 700,000 enrollees subject to the compliance requirements and an estimated 165,000-300,000 of those non-exempt enrollees are at risk of non-compliance. However, actual enrollee impact will be determined by the interpretation of the final rule.

CMS said that states must generally implement the requirement no later than Jan. 1, 2027. Certain individuals are exempt from the requirement, including those who are pregnant or in a postpartum period, disabled or medically frail, parents and caretakers of children under 14 years of age or people with disabilities, American Indians and Alaska Natives, and certain others, and allows states to offer exemptions for short-term hardships. Click here to view the CMS fact sheet for more details.

Provisions in the rule are effective on July 31, 2026, and comments must be submitted by that date.

President Signs EO on Childhood Immunization Schedule
President Trump recently signed an Executive Order (EO) that directs the Centers for Disease Control and Prevention (CDC) and the Advisory Committee on Immunization Practices (ACIP) to review a scientific assessment conducted by the U. S. Dept. of Health and Human Services that compares U.S. childhood immunization recommendations with those of peer nations. The EO recommends the CDC and ACIP take any appropriate steps to update the U.S. childhood and adolescent vaccine schedule to align it with those from other nations. The administration also recommended that all immunizations on the schedule should continue to be covered without cost sharing by private insurers and covered by Medicaid, the Children's Health Insurance Program and the Vaccines for Children Program.