April 2026 Healthcare Regulatory Check-Up: Key Developments and Compliance
The April 2026 edition of McDermott Will & Schulte's Healthcare Regulatory Check-Up highlights key regulatory developments, including enforcement actions under the False Claims Act and new CMS proposals. Notable updates include OIG's advisory opinions and CMS's oversight plans for compounded drugs for Medicare beneficiaries, which underscore the evolving landscape of regulatory compliance requirements.
On April 7, 2026, the Ninth Circuit Court delivered a mixed ruling on California Assembly Bill 290. The court identified unconstitutional elements that violated First Amendment associational rights, impacting financial links between dialysis providers and nonprofit charities. In contrast, the Sixth Circuit affirmed ERISA's preemption of certain Tennessee laws targeting pharmacy benefit managers, emphasizing the complexities of state versus federal regulatory standards.
Regulatory enforcement saw significant actions with the FTC obtaining a restraining order against a misleading insurance marketing scheme. Meanwhile, a Florida insurance brokerage faced a $135 million settlement for fraudulent ACA enrollments, spotlighting the critical nature of regulatory compliance in enrollment procedures.
Significant CMS regulatory adjustments included finalizing policy changes for Medicare Advantage and Part D programs for 2027, with a 2.48% payment increase for Medicare Advantage plans. Proposed rules also aim to enhance payment systems like the IPPS and LTCH. These changes are designed to align with the evolving demands of healthcare carriers and providers.
CMS and the ONC's April 10, 2026 proposal introduces interoperability and AI-driven prior authorization standards for drug approvals within healthcare programs. This initiative seeks to enhance electronic processing and ensure transparency, addressing challenges faced by insurance providers and healthcare systems.
OIG’s Advisory Opinions and Reports
OIG’s Advisory Opinion 26-06 evaluated cost-sharing waivers for Medicare-covered therapy services by a domestic violence service provider, finding them compliant due to policy objectives. Similarly, Advisory Opinion 26-07 assessed MA organizations' cost-saving share agreements, posing low risk under the AKS due to stringent oversight.
OIG's report on CMS’s handling of compounded drugs highlighted oversight gaps, urging improvements in tracking and preventing medication errors. Future evaluations will assess FDA's oversight of GLP-1 drug compounding, reflecting ongoing regulatory recalibration geared towards risk management for healthcare providers and payers.