Federal Politics

The federal government shut down overnight. Medicaid and Medicare reimbursements will continue, but many HHS staff have been furloughed, delaying Medicaid operations, rulemaking, and waiver approvals. SAMHSA will operate with limited staff but will maintain critical services including the 988 Suicide & Crisis Lifeline. Previously awarded grant funds remain available, but new grants, approvals, and funding opportunities are on hold. Telehealth flexibilities under Medicare expired Sept. 30. Without congressional action, pre-pandemic rules take effect today.

The Senate passed a reauthorization of the SUPPORT Act, which covers several programs related to substance use disorder treatment and support for the behavioral health workforce. The bill now awaits the president's signature.

So far, it's looking like we will see a government shutdown before we see agreement on funding. Senate Democrats refused to pass the House Republicans' continuing resolution (CR) that would keep the government afloat for 7 weeks beyond the end of September. They instead introduced a counterproposal that would also repeal many of the pieces of the One Big Beautiful Bill Act that gutted Medicaid funding, extend Affordable Care Act premium tax credits, and extend the CCBHC demonstration program.

Recent changes in federal law (H.R. 1, Public Law 119-21) will eliminate premium tax credit eligibility for roughly half of New York’s 1.7 million Essential Plan enrollees, and cut $7.5 billion of annual funding for the program under the 1332 Waiver. Governor Hochul and the Department of Health announced today that the state will not backfill this funding, which is what supported truly significant expansions in Essential Plan eligibility in recent years.. Instead, the state plans to terminate the 1332 waiver and re-activate the Basic Health Program (BHP) in order to mitigate the impact and maintain coverage for 1.3 million individuals. 450,000 individuals with incomes under $39,125 per year will lose their access to comprehensive and low-cost health insurance. These changes are expected to take effect by July 1, 2026. Enrollees who remain eligible under the BHP will continue their coverage without disruption. Others will transition to Qualified Health Plans,…

Rep. Jerry Nadler announced he will not seek reelection in 2026, ending a 32-year career in Congress after previously serving in the New York State Assembly. His retirement opens the field for several Manhattan Democrats, with names floated including Assemblyman Micah Lasher (Nadler’s reported preferred successor), Assemblyman Alex Bores, Council Member Eric Bottcher, Assemblyman Tony Simone, Assemblywoman Linda Rosenthal, and State Sen. Liz Krueger. Liam Elkind, a nonprofit founder, has already launched a challenge. Read more here.