Key Takeaways:
- 2026 is a pivotal year for U.S. healthcare.
- Structural, regulatory and competitive changes will alter the landscape.
- 10 areas will likely be the foci.
Last week…
- the stock market took a dive largely due to tech company volatility resurrecting fears of an A.I. bubble.
- reports from the Departments of Labor and Commerce confirmed mixed signals about the economy: job growth was relatively strong but inflation (3%) remained stubbornly above its 2% target and consumer confidence slid.
- Target warned Black Friday sales later this week will likely signal softness in consumer spending, and
- Congress returned to DC after its 43-day shutdown that ended with no agreement on extension of insurance tax credits that expire at year end.
This week, Thanksgiving will likely slow down things on the U.S. domestic front but not for healthcare. Unlike just about every other industry in the economy, we operate 24/7/365. And like some industries, demand for our services is hard to predict– acts of God, accidents, court decisions, regulatory policy changes, social media “experts” et al. make predictions educated guesses at best. New technologies, clinical innovations, A.I. and private capital keep planners off-balance. Short-terms plans are more defensible; longer-term plans more challenging.
Thus, the industry is understandably focused on 2026. Here are assumptions:
- Affordability for groceries, transportation, housing and healthcare (premiums and out-of-pocket) will drive media attention, public opinion and voting November 3, 2026.
- Congress will not extend tax credits that expire at year-end prompting a spike in the uninsured and under-insured populations. In tandem, large private insurers will raise premiums and increase leverage with providers to reduce competitive threats.
- Media coverage of healthcare will feature sensationalism, soundbites and hyper-simplification: costs (affordability), prices, disparities, executive compensation, outcomes, community benefits, workforce dissatisfaction, profitability and business practices will be foci.
- Warfare between hospitals, insurers, and drug manufacturers will intensify. Each will assert their systemic reform proposals serve the greater good best by protecting themselves against unwelcome threats.
- States will be the epicenters of health system transformation. Federal changes will be paralyzed by partisan-brinksmanship and posturing for 2026 and 2028 elections.
- Trust and confidence in the health system will decrease (further) to record levels of discontent.
And, reflecting on the current state of affairs in U.S. healthcare, here are 10 healthcare headlines you MIGHT see next year:
- Employed physicians win class action challenge to hospital employment agreements citing clinical independence, excessive administrative costs concerns
- IRS cuts not for profit health systems tax exemptions. Private investments, community benefits, executive compensation cited
- UnitedHealth Group completes acquisition of HCA: sets stage for new era of competition in U.S. healthcare
- EPIC completes interoperability agreement with CMS: public-private oversight board named
- Congress passes most favored nation pricing for biologics, specialty drugs as states enact price controls
- Large employers drop employee coverage due to costs, systemic flaws in system
- Health and wellbeing services consolidated under HHS to integrate social services and health
- Primary care physicians, nurse practitioners, community pharmacists launch national society to advance primary and preventive health services
- CMS capitates, expands primary care services in restructured MSSP program
- National coalition launched to design transformed system of health that’s accessible, affordable, comprehensive, efficient and effective
And, I’m confident, many others.
2026 is a mid-term election year. In 2016 (Trump 45 Year One), Republicans controlled 31 governorships and 68 legislative chambers. This January, the GOP will control 26 governorships and 57 legislative chambers– a 15% reduction on both. Politics is divided, affordability matters most to voters and healthcare is a high-profile target for campaigns so humility, thoughtful messaging backed by demonstrable actions will be an imperative for every healthcare organization.
2026 is a HUGE year for U.S. healthcare. The outcome is unknown.
Paul
PS: Citations upon which this report is based are available below. I am taking Next weekend off to be with family. The next Keckley Report will be published December 2 and include an important announcement. Stay well. Thanks for reading.
Sections in today’s report
- Quotables
- Economy
- Employers
- Hospitals
- Insurers
- Physicians
- Prescription Drugs
- Public Health
Quotables
Microsoft CEO Satya Nadella on strategy refresh: “We need to rapidly rethink the new economics of AI across the company — just as we once did with the cloud. This platform shift is all about building a new AI factory and family of Copilots and agents that drive diffusion and usage across the full stack.”
Microsoft CEO Taps Advisor to ‘Rethink’ Its Business for AI Era: Memo – Business Insider
Trilliant on hospital price transparency November 21, 2025: “In every industry in which consumers have benefited from price transparency, like airline travel, information is made available in advance of the transaction. While healthcare price transparency is “good” policy, maximizing the value of price transparency requires employers to utilize it before choosing a provider network. To date, health plan price transparency is utilized like pricing in airport retail shops, where the traveler can compare the cost of a $5 bottle of water and a $6 cup of coffee.
Until hospitals, insurers and policymakers close the gap between data availability and decision-making utility – ensuring that comparative pricing information reaches patients and employers before they need it – transparency regulations will remain a theoretical tool rather than a practical solution for the Americans whose financial wellbeing increasingly depends on making informed healthcare decisions.”
Trilliant Health Compass November 21, 2025
WSJ on Middle Class Economic Pressure November 20, 2025: “America’s middle class is weary. After nearly five years of high prices, many middle-class earners thought life would be more affordable by now. Costs for goods and services are 25% above where they were in 2020. Even though the inflation rate is below its recent 2022 high, certain essentials like coffee, ground beef and car repairs are up markedly this year.
The American middle class encompasses a broad cross section of workers that includes white-collar office employees, nurses and plumbers, although there is no universally accepted definition.
Pew Research Center defines the middle class broadly as having a household income between about $66,666 and $200,000, depending on where they live. Perpetual sticker shock is making many within the group feel worse about both their own finances and the future of the country. They are hunting for bargains and spending more carefully.”
Middle Class Is Buckling Under Almost Five Years of Persistent Inflation – WSJ
Trump on direct payments in lieu of subsidies November 18, 2025: “THE ONLY HEALTHCARE I WILL SUPPORT OR APPROVE IS SENDING THE MONEY DIRECTLY BACK TO THE PEOPLE, WITH NOTHING GOING TO THE BIG, FAT, RICH INSURANCE COMPANIES, WHO HAVE MADE $TRILLIONS, AND RIPPED OFF AMERICA LONG ENOUGH,” Trump wrote in a statement on Truth Social.
“THE PEOPLE WILL BE ALLOWED TO NEGOTIATE AND BUY THEIR OWN, MUCH BETTER, INSURANCE. POWER TO THE PEOPLE! Congress, do not waste your time and energy on anything else. This is the only way to have great Healthcare in America!!! GET IT DONE, NOW,”
President Trump advocates for direct health care payments, slams insurance companies
AMA President to House of Delegates November 15, 2025: In his opening address at the AMA House of Delegates interim meeting, Bobby Mukkamala, MD, seemed to seek neutral territory: “Let us be healers, yes, but let us be warriors when necessary…Let us heal always, and let us lead together, forever.”
Axios Vitals on CDC Vaccine Guidance (November 21, 2025: “The CDC’s website as of Wednesday uses language describing a debunked theory of vaccines’ link to autism that’s more reflective of anti-vaccine activists’ thinking.
The claim ‘vaccines do not cause autism’ is not an evidence-based claim because studies have not ruled out the possibility that infant vaccines cause autism…in an about-face from its previous guidance that studies haven’t found a link between the two.
Studies supporting a link have been ignored by health authorities,” it adds. This new language is at odds with long-standing scientific consensus, formed through dozens of studies. Where it stands: With the exception of COVID shots, vaccines are just as easy to get today as they were a year ago and still covered by insurance, despite increasingly hostile federal rhetoric.”
Thompson (AHA SVP) on Hospital TEAM Readiness November 21, 2025: “Hospitals will have to commit significant resources to implement care redesign and build out their infrastructure, all within an unreasonably compressed timeframe. This comes at a time when many hospitals are struggling in today’s challenging operating environment, especially those in rural and underserved communities. For these reasons, we continue to urge CMS to make TEAM voluntary. The AHA has long supported widespread adoption of meaningful, value-based and alternative payment models to deliver high-quality care at lower costs. We remain concerned that TEAM will not advance these objectives and puts at particular risk hospitals that are not of a large enough size or in a position to support the investments needed to be successful.”
CMS’ TEAM model leaves hospitals scrambling before 2026 launch – Modern Healthcare
Town Hall Ventures on medication management: “For years, value-based care innovation focused on new models in primary care, virtual care, or home-based services. These models have assumed that providers could manage medications, but clinicians remain overwhelmed and under-supported. For too long, pharmacy has sat downstream of care delivery—treated as a fulfillment function rather than a clinical partner —undermining even the most sophisticated care delivery models.
We believe the next generation of companies will blur that line—embedding medication access and optimization into the heart of patient care — enabling tighter coordination, better adherence, and lower costs. Pharmacists—both human and AI-driven—become part of the care team, with technology integrating their workflows and giving providers the tools to guide patients from prescription to fulfillment to follow-up…
Sophisticated platforms—powered by AI—can ease the burden of rising polypharmacy, prescription access, and complex coverage rules by optimizing medication decisions and specialty dispensing at scale. AI can now flag drug interactions, suggest cost-effective alternatives, and automate time-consuming processes like prior authorizations…”
PK Note: Mainstreaming AI-driven medication management across the health system is an urgent imperative. But in some settings, it’s neglected or subordinated to other concerns. Emergent AI-driven primary care platforms like Tom (Lumeris) appear to transcend conventional industry pushback about data security, care coordination and scalability costs.
From Prescriptions to Patients: How AI Is Redefining the Medication Experience — Town Hall Ventures
Bloomberg on affordability November 18, 2025: “It seems like no accident that Donald Trump decided to headline a gathering of McDonald’s fast-food franchisees. The president has an affordability problem with voters, and in a rarity, appears to be admitting as much.
I’m referring to Trump’s furious attempt to convince American voters that he is, in fact, focused on reducing the cost of living (housing, groceries, all of it). The issue is their top concern, as any public opinion poll will tell you. It’s the reason Trump became only the second defeated president to eventually be reelected. Voters believed the businessman was best suited to improve the economy.
The larger problem for Trump is that voters aren’t only upset that prices remain high. They are questioning whether he even cares.”
Affordability: Trump Needs to Prove He Actually Cares – Bloomberg
Economy
U of MI consumer sentiment survey for November 2025: “Consumer sentiment was little changed this month with a 2.6 index point decrease from October that is within the margin of error. After the federal shutdown ended, sentiment lifted slightly from its mid-month reading. However, consumers remain frustrated about the persistence of high prices and weakening incomes. This month, current personal finances and buying conditions for durables both plunged more than 10%, whereas expectations for the future improved modestly.. market declines seen over the past two weeks… Year-ahead inflation expectations inched down from 4.6% last month to 4.5% this month. This marks three consecutive months of declines, but short-run inflation expectations still remain above the 3.3% seen in January. Long-run inflation expectations softened from 3.9% last month to 3.4% in November. These expectations are now modestly above the 3.2% January 2025 reading. Despite these improvements in the future trajectory of inflation, consumers continue to report that their personal finances now are weighed down by the present state of high prices.”
University of Michigan Survey of Consumers https://www.sca.isr.umich.edu/
BLS on CPI November 21, 2025: “The Consumer Price Index for November 2025 will be released Thursday, December 18, 2025, at 8:30 AM Eastern Time. BLS will not publish an October 2025 Consumer Price Index. BLS could not collect October 2025 reference period survey data due to a lapse in appropriations. BLS is unable to retroactively collect these data. For a few indexes, BLS uses nonsurvey data sources instead of survey data to make the index calculations. BLS is able to retroactively acquire most of the nonsurvey data for October. Where possible, BLS will publish October 2025 values for these series with the release of November 2025 data.
The Employment Cost Index for September 2025 will be released Wednesday, December 10, 2025, at 8:30 AM Eastern Time. Please see the revised news release dates announcement for original and revised release dates. We will update the release calendar as new release dates are finalized.”
| BLS September Jobs Report released November 20, 2025: Highlights:
· Both the unemployment rate, at 4.4% and the number of unemployed people, at 7.6 million, changed little in September. These measures are higher than a year earlier, when the jobless rate was 4.1%, and the number of unemployed people was 6.9 million. · The labor force participation rate, at 62.4%, changed little over the month and over the year. The employment-population ratio, at 59.7% also changed little in September but was down by 0.4 percentage point over the year. |
- In September, health care added 43,000 jobs, about the same as the average monthly gain of 42,000 over the prior 12 months. Over the month, employment gains occurred in ambulatory health care services (+23,000) and hospitals (+16,000). Employment in food services and drinking places continued to trend up in September (+37,000).In September, social assistance employment continued to trend up (+14,000), reflecting continued job growth in individual and family services (+20,000).”
Employment Situation Summary – 2025 M09 Results
Stat: Medicare Premiums to Jump 10% In 2026: “Most Medicare enrollees will face premiums that are 10% higher next year, creating budget anxiety for millions of seniors. Older adults and people with disabilities will pay almost $203 per month in 2026 for their Medicare Part B premium, the Trump administration said late Friday. That’s about 10% higher than the $185 per month that Medicare beneficiaries pay this year. “
Medicare premiums to jump 10% in 2026 | STAT
Gallagher on Q3 Corporate Earnings (November 17, 2025):
- “Companies Report Strong Q3 Earnings: With 92% of S&P 500 companies reporting results through mid-November, the year-over-year blended earnings growth rate for Q3 for such companies (including both actual results and estimates for those yet to report) stood at 13.1%… the fourth consecutive quarter of double-digit earnings growth for index companies. Further, 82% of companies have reported a positive earnings surprise relative to brokerage firms’ expectations, while 76% have reported a positive revenue surprise.
- Small Business Confidence Wanes in October: The National Federation of Independent Business (NFIB) reported last week that its Small Business Optimism Index registered 98.2 in October, down slightly from 98.8 in September but remaining just above the 52-year average of 98.0. The Index’s latest decline was mainly driven by business owners’ concerns about labor availability and quality, with 32% of owners reporting an inability to fill job openings and 27% citing labor quality as their single most important problem. Overall, the net percentage of owners expecting better business conditions fell three percentage points to a net 20%, the lowest level since April.
- Traders Pare December Rate Cut Bets: Traders on Wall Street have become less optimistic in recent weeks about the possibility of another rate cut by the Federal Reserve at its next meeting on December 10th. At the end of last week, the odds of a December cut — based on the pricing of fed funds rate futures contracts — stood at 39%, down from 64% in the prior week and nearly 90% one month ago. The sharp decline is partially due to traders betting Fed officials may remain on hold given the limited availability of economic data in the wake of the recent U.S. government shutdown, combined with the fact that inflation remains above the Fed’s 2% target rate.”
Weekly Financial Markets Update November 17, 2025 | AJG United States
Commerce Department: November 19, 2025:” President Trump’s sweeping tariffs took a toll on trade in August, as imports dropped 5.1 % to $340.4 billion, after taxes on exports from roughly 90 countries went into effect on Aug. 7, newly released data from the Commerce Department showed Wednesday.
U.S. exports were essentially flat, rising 0.1% to $280.8 billion. Because of the sharp fall in imports, the U.S. trade deficit in goods and services for the month also dropped sharply, shrinking nearly 24% to $59.6 billion, compared with July.
The data, which had been delayed by more than a month because of the government shutdown, gives the first look at trade patterns after Mr. Trump introduced what is effectively a new trading system for the United States.”
Breaking news: Trump’s global tariffs curtailed trade, data shows
Target strategic focus: middle class spending: “Target will do everything short of handing out cookies as customers arrive this holiday season — and it probably still won’t be enough to reverse declining sales.
That’s because upper-middle-class American shoppers are increasingly skittish and uncertain. This same customer has historically relished Target’s mix of discretionary style, décor, kids’ gear, beauty, and “cheap but not like Walmart cheap” everyday essentials. But they’re not feeling so confident now, and nowhere is their hesitation more visible than in Target’s results.
Recent data releases show the American middle- and upper-middle-class squeezed on all sides. White-collar layoffs are piling up, with October alone seeing 153,000 job cuts — the highest October tally since 2003. What hiring growth remains is limited to non-discretionary sectors like healthcare and education. Restaurant visits are falling except among the wealthy. Even McDonald’s reports double-digit drops from lower-income customers and flat traffic from the middle class.
Not coincidentally, alongside those trends, household debt keeps rising: Credit-card balances perch at a record $1.23 trillion, serious delinquencies are up 80% from a year ago, and car loans are now so expensive that one in five borrowers pays more than $1,000 a month. These larger forces have Target’s core customers quietly but clearly cutting, trading down, pulling back — exactly the kind of “choiceful” behavior management foresees ensuring a rough holiday sales season.”
Target earnings show it bracing for a brutal holiday shopping season
AEI on housing affordability: “In 1981, the median age of a first-time homebuyer was 29. Today it’s 40, and people in their 30s have a homeownership rate of only 42%… President Trump’s 50-year mortgage proposal may only put Americans in debt longer, and his tariff policies could force building costs up for any housing. But other policy proposals, such as public housing, are also not likely to address the full challenges facing potential homebuyers. Instead, the administration should work toward policy that provides more individuals the opportunity to afford a mortgage while boosting the number of homes available.
New York City Election Lessons | American Enterprise Institute – AEI
Pitchbook: Q3 Deal activity November 18, 2025: Takeaways:
- “Healthcare services deal activity declined in Q3 2025, with an estimated 161 deals announced or closed, down 13% from the previous quarter.
- However, Q1 and Q2 activity rerated a bit higher than initial estimates suggested. YTD, deal activity in healthcare services is on track to just modestly surpass 2024 levels, and we believe Q3 will represent a near-term trough.
- The Q3 decline in deal count is primarily attributable to PPMs, where the market may have temporarily paused to assess the impact of increased regulatory burdens for PE ownership of PPM assets in states such as California.
- Going forward, additional rate cuts and extended PE holding periods for PPM assets (with over 70% of the PE inventory currently held for more than 7 years) should result in a substantial upturn in activity in 2026 as valuation gaps between buyers and sellers converge.”
PitchBook_Q3_2025_Healthcare_Services_Report.pdf
Pitchbook on Q3 HealthTech investing November 19, 2025: Takeaways:
- Healthtech VC funding is rebounding, with startups raising $3.9 billion in Q3 2025—slightly below prior quarters but enough to push the YTD total above 2024 values. Deal volume also rose modestly (up 12%), signaling renewed investor appetite in the healthtech sector.
- Median VC pre-money valuations hit a record high of $38.5 million, up from $33.8 million in Q2, underscoring how some valuation expansion—particularly among AI-focused startups—is now driving deal size growth, even as broader deal activity stabilizes.
- VC exit count surged to an all-time high of 42, though total exit value remained muted, as most transactions involved smaller, early-stage acquisitions. Liquidity-driven consolidation is accelerating as founders and investors seek exits outside the traditional IPO channel. IPO momentum has paused following earlier listings this year from Omada Health and Hinge Health. Other late-stage startups, including ZocDoc, Spring Health, and Maven, remain IPO candidates for 2026, with VC Exit Predictor probabilities exceeding 80%.
- AI continues to be a defining theme in healthtech, with adoption expanding from clinical decision support into the operational backbone of care delivery.
Q3_2025_Healthtech_VC_Trends_Preview.pdf
Study: workforce compensation changes: “In our analyses, we measured median inflation-adjusted weekly earnings for health care workers by occupation, educational attainment, race and ethnicity, and sex, with a focus on change over time…
Across nonphysician occupations, the strongest relative earnings growth occurred among aides and assistants, who saw gains of 13.6% during 2015–24. In contrast, RNs and technicians experienced little wage growth (3.8%and 1.1%, respectively), and earnings gains for advanced practice providers—although higher in absolute terms—were lower in relative growth (8.3%). Educational attainment reveals a similar story. Although workers with a college degree and higher consistently earned the highest wages, their earnings grew by less than 1% over the period. The largest gains occurred among workers with only a high school diploma (13.0%), followed by those with some college (8.0%). “
Employers
Mercer 2025 National Survey of Employer-Sponsored Health Plans highlights:
- The average cost of employer-sponsored health insurance climbed to $17,496 in 2025, up 6% from the year before and in excess of rates of inflation and wage growth,
- Costs are projected to continue to rise another 6.7% in 2026, making the average cost per worker $18,500, the survey found.
- “A “sharp growth” in prescription drug spending, including pricey GLP-1 weight-loss medications, helped fuel the increase. Prescription drug spending was up an average 9.4% among large employers, those with 500 or more workers, while GLP-1 coverage for weight loss among the same group climbed to 49% in 2025 from 44% the previous year
Employers are challenged to keep healthcare affordable as costs soar: Survey results
Hospitals
AHA on CMS hospital payment announcements November 21, 2025: “The Centers for Medicare & Medicaid Services Nov. 21 issued a final rule that, among other provisions, increases Medicare hospital outpatient prospective payment system rates by a net 2.6% in calendar year 2026 compared to 2025. This includes a 3.3% market basket update, offset by a 0.7 percentage point cut for productivity. The rule includes payment reductions via site-neutral payment policies, the elimination of the inpatient-only list and other changes.
In a statement shared with the media, Ashley Thompson, AHA senior vice president of public policy analysis and development, said, “The AHA is disappointed that CMS has finalized cuts to hospitals and health system services, including those in rural and underserved communities. Combined with its continued inadequate market basket updates, the agency is exacerbating the challenging financial pressures under which hospitals are operating to serve their patients and communities.”
CMS increases Medicare hospital outpatient department payment rates by 2.6% in CY 2026 | AHA News
Health Affairs Op Ed on 340B rebate pilot: “At the time of its passage, 340B was expected to be a small program. In addition to the federal grantee clinics, fewer than 1% of hospitals participated in the first decade of the program. Today, lax enforcement of program eligibility rules combined with two key program expansions around 2010, the program has grown to include two-thirds of all non-profit hospitals in the United States and the discounted cost of the purchases has reached $66B…
Although the lawsuits were unsuccessful, HRSA has established a rebate pilot program focused solely on the ten drugs currently subjected to IRA’s drug price negotiation, set to begin in January 2026. While the rebate pilot may help manufacturers with program integrity, converting the program from an upfront discount to a rebate may create significant operational and financial challenges for some covered entities…
The 340B rebate pilot weights program integrity against financial stability for safety net providers. A formal evaluation will be necessary to assess whether and to what extent the program compromises the stability of the safety net and whether it creates other unintended consequences.”
Study: Medicaid cut impact on urban hospitals: “Despite federal lawmakers’ focus on rural hospitals, the OBBBA cuts may have an even more direct impact on urban, safety-net hospitals. While rural hospital closures have drawn national attention, the closure of urban hospitals has also emerged as a cause of concern for federal regulators. With 80% of the US population residing in urban areas, the closure of urban hospitals may have an equally or even more profound population-level impact than the closure of rural hospitals. This is particularly true for safety-net hospitals in Medicaid expansion states, where Medicaid patients represent 24% of patient revenues. Additionally, nearly 1 in 4 hospitals is already characterized as financially distressed, operating with razor-thin margins and at risk for bankruptcy. Hospitals with a high share of revenue from Medicaid patients are at higher risk for financial distress than those with a low proportion of revenue from Medicaid. Further reductions in Medicaid reimbursement and the growing burden of providing uncompensated care to the uninsured may tip financially distressed hospitals further toward closure, bankruptcy, or conversion to non-hospital facilities.”
MD Audit study: physician revenue integrity 2025: “Healthcare providers are navigating a complex set of financial and regulatory pressures to drive sustainability. Providers who invest in emerging technologies to drive operational efficiency and empower their staff will be successful. Highlights:
- In 2025, the average denied amount across hospital inpatient and outpatient settings increased by double digits – 14% in hospital outpatient and 12% in inpatient settings.
- In 2025, the total at-risk amount and cases per customer increased by 30% for external payer audits. The average amount per claim also increased by 18%.
- Risk-based audits within the platform increased by 25% in MDaudit in 2025. Pre-bill audits increased by 30%. Coding-related denials continued to rise in outpatient settings in 2025. There was a 26% increase in coding-related denials, incremental to last year’s 126% increase.”
MD Audit 2025 Benchmark Report https://mdaudit.com/resource/report-ty/2025-benchmark-report/?submissionGuid=03697b92-3e4d-415a-b950-9bab29a57e5e
KFF on Medicare Advantage Chart Reviews: “Using Medicare Advantage encounter data for 2022…Across the 29 million Medicare Advantage enrollees, more than six in 10 (62%) or about 18 million people, had at least one chart review record in 2022…… Across all Medicare Advantage insurers, nearly one in six (17%) enrollees had at least one diagnosis on a chart review record that resulted in an additional condition category being added that affected the person’s risk score but did not appear on any encounter records submitted by providers. Among the 18 million enrollees with at least one chart review, about 30% had a diagnosis added from a chart review that increased the federal payment to the Medicare Advantage plan. However, chart reviews can also identify diagnoses that are inaccurate, no longer an active consideration, or unrelated to the clinical care enrollees receive, and thus potentially inappropriate to submit to CMS for payment purposes.”
Chart Reviews Increase Payments to Medicare Advantage Insurers for 1 in 6 Enrollees | KFF
Physicians
Kaufman Hall: Physician subsidies: “For the first time since the COVID-19 pandemic, the median investment a medical group makes—or subsidy—per provider has plateaued…Median investment/subsidy per provider was $237,911 in Q3 2025, a slight change from $239,338 in Q2 2025.
Investment/subsidies per provider—which represent net patient service revenue minus total expense and are divided by provider full-time equivalents, or FTEs—have been trending upwards over the last few years. In Q3 they ranged from $141,371 on the lower end to $325,634 on the higher end. Labor as a percentage of total expenses remains high, at 84.2%.
Advanced practice providers (APPs) also continue to grow as a proportion of the provider workforce. Data show a consistent shift to APPs across primary care and specialties.”
Physician Flash Report: Q3 2025 Metrics | Kaufman Hall
Survey: Physician engagement: Per the May of 2025, CHG Healthcare and Hanover Research survey of 920 currently practicing U.S. physicians:
“Overall, 75% of physicians say they are “somewhat” or “very” satisfied with their current role. This satisfaction translates into a strong likelihood that these physicians will stay with their current employer for at least 12 months. A total of 64% say they are “extremely” or “very” likely to stay.
Although many physicians report being at least somewhat satisfied and intend to stay, few are highly enthusiastic advocates for their healthcare organizations. Only 29% of physicians say they are likely to recommend their healthcare organization as a great place to work. Unfortunately, even more physicians (37%) say they are unlikely to recommend their organization, translating to an overall net promoter score (NPS) of -8.”
PK note: This is one of the best physician surveys I’ve reviewed. Worthwhile reading!
2025 Physician Sentiment Survey: Keys to engagement and retention
ACO 2024 Performance Year Results: In late August 2025, CMS released Performance Year (PY) 2024 data for the Medicare Shared Savings Program (MSSP). Highlights:
- “Overall, 476 ACOs participated in the MSSP, a roughly 5% increase from the previous year’s 453 participants. The total number of beneficiaries also increased slightly, approximately one percent, from 2023-2024.
- In 2024, ACO participants in MSSP continued to generate substantial savings for Medicare, totaling over $2.4 billion in net savings and $241 net savings per capita.
- For the third year since MSSP began, and consistent with last year’s findings, the majority of ACOs took on downside risk (67%).
- Several new policiesimpacting benchmarking and financial calculations went into place for ACOs starting a new agreement period in 2024, resulting in substantially lower net savings per capita, $143, compared to ACOs not subject to the new methodology ($241 per capita savings).”
Medicare ACOs In 2024: Increased Participation and Evolving Policy Impacts | Health Affairs
Study: Primary care transformation model results: “A total of 142 records were included in the analysis from 5 programs that met inclusion criteria: the Federally Qualified Health Center Advanced Primary Care Practice demonstration, the Multi-Payer Advanced Primary Care Practice model, the Comprehensive Primary Care (CPC) initiative, CPC Plus, and Evidence NOW Advancing Heart Health.
Programs supported practice-level changes in care delivery through payment changes, performance requirements, data feedback, and technical assistance. Federal investments were associated with substantial improvements in clinical care delivery, greater patient engagement, modest reductions in utilization, and net increases in expenditures. There was an association between practice efforts and intrinsic practice characteristics, and practices were limited by funding amounts and modality, difficulties in using electronic health records and payer data to support care improvement, staff turnover, and extrinsic factors.
Cohen on lack of physician measurement in VBC November 14,2025: “Without visibility into how physician decisions impact quality and cost, even the highest-quality physicians are flying blind. If we want to close the gap between VBC’s potential vision and its reality, we must look directly at physician decision making.
That’s where the levers for true improvement lie. When clinicians can see their own decision-making data and have the requisite business frameworks to support them, they will make changes in their care delivery to impact patient care and cost.”
Physician-level measurement needed for VBC to succeed | Healthcare IT News
Prescription Drugs
Drug spending: Source of Payment for Net Outpatient Prescription Drug Expenditures,
1972-2033
| Year | Consumer Out-of-Pocket |
Private Health Insurance | Medicare | Medicaid | Other Public Payers |
| 1973 | 79% | 10% | NA | 9% | 2% |
| 1983 | 67% | 20% | NA | 11% | 3% |
| 1993 | 49% | 31% | NA | 16% | 4% |
| 2003 | 28% | 47% | 1% | 18% | 7% |
| 2013 | 17% | 42% | 27% | 8% | 5% |
| 2023 | 13% | 39% | 32% | 11% | 5% |
| 2033 (projected) | 11% | 41% | 33% | 11% | 4% |
Drug Channels Institute, September 2025
Big Pharma: “The booming market for weight-loss drugs has propelled Eli Lilly LLY 1.57%increase; green up pointing triangle to become the first pharmaceutical company to hit $1 trillion in market capitalization, joining a select club of mostly tech companies that have surpassed that threshold.
Lilly shares closed at $1,059.70 on Friday, giving it a market cap slightly above the 13-figure milestone. Lilly’s market value is more than twice as big as its next closest rival in the industry, Johnson & Johnson, which is worth about $490 billion.
The Indianapolis-based drugmaker (Eli Lilly) becomes the 10th company to surpass $1 trillion. The others are Nvidia, Apple, Microsoft, Alphabet, Amazon.com, Broadcom, Meta Platforms, Tesla and Berkshire Hathaway, according to Dow Jones Market Data.”
Eli Lilly Hits $1 Trillion Market Cap on Booming Weight-Loss Drugs Mounjaro and Zepbound – WSJ
WSJ on ADHD Prescribing November 19, 2025: “Tens of thousands of kids who take prescription ADHD medication also wind up on other powerful psychotropic drugs—including antipsychotics and antidepressants, studies show. For some of them, the ADHD drugs themselves can be a trigger… despite limited scientific evidence supporting these combinations in young, developing brains.
About 7.1 million American children ages 3 to 17 have an ADHD diagnosis, according to an analysis of 2022 federal data. About half took ADHD medication for it that year, and prescriptions are growing…
For one in five kids who take them, ADHD drugs are just the beginning. A Wall Street Journal analysis of Medicaid data from 2019 through 2023 shows that children who were prescribed a medication for ADHD were far more likely to take additional psychiatric drugs over the ensuing four years.
The Journal compared about 166,000 children aged 3 to 14 who started on ADHD medications in 2019 to kids who didn’t. The medicated group was more than five times as likely to be on additional psychiatric medications four years later. Factors such as differences in sex, race and foster-care status didn’t explain the gap.
The data also show that for most children, medications are the first stop in ADHD treatment. Only 37% of the kids newly prescribed ADHD drugs in 2019 had prior behavioral therapy appointments, the Journal’s analysis showed…”
Millions of Kids Are on ADHD Pills. For Many, It’s the Start of a Drug Cascade. – WSJ
Public Health
Study: Maternal health access: “In 2024, there were 18.7 maternal deaths per 100,000 live births, with Black and Native women at significantly higher risk of maternal mortality. Medicaid is at the forefront of addressing the US maternal health crisis given that it covers 4 in 10 births nationwide, nearly two-thirds of births to Black women, and more than one-quarter of births to Native women…
All states except for Arkansas and Wisconsin have since extended pregnancy-related Medicaid coverage for a full year postpartum. . Even though new Medicaid policies under the 2025 budget law do not directly threaten postpartum extensions, they could lead to incorrect information and confusion among enrollees and providers, stress eligibility systems, further weaken delivery systems, and strain state budgets — exacerbating existing implementation challenges. Medicaid’s momentum on maternal health could stall, if not reverse…”
