IHA Daily Briefing: October 30

Federal Judge Rules Against Medicaid Guidance Requiring Proof of 'Medically Frail'

A federal judge yesterday blocked a Centers for Medicare & Medicaid Services rule that would have required medically frail individuals on Medicaid to demonstrate their conditions prevent them from complying with the work requirements established by the 2025 One Big Beautiful Bill Act. Illinois was one of 25 states and the District of Columbia that filed a lawsuit against the rule. In his ruling, Judge Richard Stearns said, "because enforcement of an unlawful definition of "medically frail" may lead to the disenrollment of otherwise eligible vulnerable individuals relying on Medicaid coverage for continuity of care, the States (and public) face potential for great hardship in the absence of an injunction. The court accordingly will issue the permanent injunction requested by the States."

Additionally, the ruling requires states wait until six months after the work rules take effect to cancel the health insurance of those claiming a medical exemption, "to accommodate any errors or delays which may arise given the short timeline under which the States must now change their verification systems." CMS has not commented on the decision or whether it will appeal the ruling. The ruling only blocks the "medical frailty" piece of the law; additional Medicaid work requirements remain in place and will be enforced nationally beginning in January.

Rule Finalized on Transparency of PBM Fee Disclosures

The U.S. Dept. of Labor yesterday finalized a rule intended to improve transparency of fees collected by pharmacy benefit managers (PBMs). Under the new rule, PBMs are required to divulge drug manufacturer rebates and other payments, any compensation collected when the health plan's price for a prescription drug exceeds the amount reimbursed to the pharmacy, and payments recovered from pharmacies in connection with prescription drugs dispensed to a health plan. Plan fiduciaries are also allowed to audit PBM disclosure accuracy and offer additional relief if their PBM fails to meet its obligation.

Early Alert: Recall, Correction Issued for All Medline Brand Beds

In a Food and Drug Administration (FDA) Early Alert issued yesterday, the FDA said it is aware that Medline has issued an Urgent Medical Device Field Safety Notice notifying customers of the discontinuation of all Medline Brand beds and accessories due to a potential fire hazard and risk of entrapment or asphyxiation. As of Oct. 20, Medline has reported two deaths and 16 serious injuries associated with the issue and is recommending the products be removed from where they are used or sold, or in some cases, corrected prior to continued use. All Medline brand beds and associated components are affected by this action, including homecare beds, bariatric beds, long-term care beds, pendants, accessories, replacement parts, and bed-containing order packages.

AMA Advances Framework for Clinical AI Liability

Acknowledging the expanding role of artificial intelligence (AI) in clinical care, the American Medical Association (AMA) Center for Digital Health and AI this week advanced a new framework for aligning liability with each party's authority and ability to prevent or mitigate harm. AMA said existing liability frameworks were not designed for technologies in which physicians, developers, and healthcare organizations each exercise different levels of control over clinical AI systems. As a result, physicians may face liability for risks they cannot reasonably prevent, while patients may struggle to seek remedies when AI causes harm. In response, the AMA is calling for an approach that establishes well-defined, complementary responsibilities across the clinical AI lifecycle. AMA said the framework recognizes that multiple parties may bear liability for the use of AI when something goes wrong, with accountability aligned with each party's ability to prevent harm. It also emphasizes that physician oversight cannot substitute for adequate evidence, appropriate system design or the conditions necessary to make clinical review meaningful.

Illinois Respiratory Disease Surveillance Data

The Infectious Respiratory Disease Surveillance Dashboard from the Illinois Dept. of Public Health (IDPH) provides the latest data on hospital visits, seasonal trends, lab test positivity and demographic data. IDPH also tracks COVID-19, influenza and respiratory syncytial virus information through the Illinois Wastewater Surveillance System dashboard.

Briefly Noted

The U.S. Dept. of Health and Human Services (HHS), through the Food and Drug Administration (FDA), yesterday announced two actions it said is intended to ensure infant formula is both safe and nutritious for American babies. The agency issued a proposed rule that, if finalized, would update infant formula nutrient requirements. In its announcement, the FDA also released new chemical contaminant testing data showing that most infant formula samples had low or non-detectable levels of contaminants.

Daylight savings time will take place this Sunday, Nov. 1, at 2 a.m. CT, when clocks will "fall back" one hour to 1 a.m. CT. The Office of the Illinois State Fire Marshal is reminding residents daylight savings time represents an ideal opportunity to test, inspect, and replace any broken or expired smoke and carbon monoxide alarms while changing clocks this upcoming weekend.

Leading the News

DCFS director found in contempt for noncompliance with judge's order

Capitol News Illinois

A Sangamon County judge held the director of the state's child protective agency in contempt of court Thursday for the department's ongoing mishandling of a records request by Capitol News Illinois.

American College of Surgeons honors 77 hospitals for meritorious surgery outcomes

Becker's Hospital Review

Seventy-seven hospitals earned meritorious recognition for their 2025 surgical outcomes from the American College of Surgeons' National Surgical Quality Improvement Program, the organization said Oct. 28.

Nearly 60% of CEOs plan to replace a top exec: Survey

Becker's Hospital Review

Nearly 60% of CEOs plan to replace a member of their senior leadership team within the next six months, and CFOs top the list, according to an October report from Boston Consulting Group.