Federal Moves Impacting Healthcare Transparency, Fund Disbursement

I’m going to skip over the topic of the hour with the government shutdown and address two actions the federal government has taken in the last couple of weeks that you also need to know about.

First, the Centers for Medicare & Medicaid Services (CMS) finalized a rule requiring Medicare Advantage (MA) plans to disclose their provider directories on the Medicare Plan Finder for 2027 open enrollment. The policy was actually initially proposed by the Biden Administration last year, but is part of an effort promoting increased transparency that President Trump has enthusiastically continued.

Pursuant to the rule, MA plans will now be required to submit their provider directory data to be published online by CMS, update the information within 30 days of being informed about any changes, and attest at least annually that the information contained in the directory is accurate. CMS also created a special temporary election period for people who select a plan based on provider directory information later found to be inaccurate.

CMS released a memo to insurers on the new change, stating that the disclosure is meant to increase beneficiaries’ access to data and help them make informed choices about their coverage. The agency will publish an operational guide imminently, which will provide additional information on the timing of milestones required by the rule.

CMS also noted that it did not end up finalizing the part of the proposed version of the rule that would have required MA organizations to attest that their directory data is consistent with data submitted to comply with CMS’s MA network adequacy requirements.

In other news, frequent readers may remember that President Trump ordered the federal government to phase out paper check disbursements for things like benefits payments, vendor payments, tax refunds, and more. He ordered agencies to transition to electronic funds transfer (EFT) methods like direct deposit and prepaid cards by Sept. 30, and that all payments made to the government be processed electronically as soon as possible.

The date is here, and most agencies are starting the phaseout period.

The executive order (EO) cited reasons for this change such as unnecessary costs, delays, and risk of fraud, lost payments, or theft. 

The Bureau of Fiscal Service reports that check fraud has increased by 385 percent since the beginning of the COVID-19 pandemic. Reports on consumers without bank accounts indicate that they can be charged fees of up to 12 percent to cash checks. Checks are also reported to be 16 times more likely to get lost, stolen, altered, or delayed.

It’s also expensive for the federal government:50 cents per payment, compared to 15 cents for an electronic funds transfer check. 

And finally, many other comparable countries made the switch away from checks years ago.

Critics have acknowledged that while this move may be the correct one, the phaseout might be too quick for the people who depend on federal disbursements the most. 

The government has responded to these concerns by acknowledging that they will continue to provide beneficiaries with paper checks if they have no means of getting digital payments. There is also a plan to pursue a public awareness campaign.

Some banks, like JPMorgan Chase, have been informing customers about the impending change as well.

While it’s obviously a busy week for Congress, the Trump Administration continues its push forward on transparency and modernization initiatives.