By: Andrew Spicer and Kate Honsberger 

Last year brought a wave of consequential legislative and regulatory changes that reshaped U.S. health care policy, driven by political urgency from the new Congress and the incoming Trump administration. These shifts are expected to have lasting effects at both federal and state levels and will influence the 2026 landscape, while ongoing economic and technological developments continue to shape sector challenges and risks. 

Actions last year included:

• A surge of new Center for Medicare and Medicaid Innovation (CMMI) models
• Updates to the vaccine schedule, Most Favored Nation (MFN) drug pricing, and
• The most significant Medicaid legislation since the Affordable Care Act.

As we enter 2026, the federal government is focused on combating fraud, accelerating a new generation of health care innovation, and reining in federal spending, while states work to implement provisions of the One Big Beautiful Bill Act (OBBBA) amid rising costs and limited administrative capacity. 

To help make sense of where health policy is headed in 2026, Healthsperien is laser-focused on the major regulatory, legislative, and implementation developments to watch in the year ahead. 

Behavioral Health 

Early Executive Orders from the White House and action led by the Department of Health and Human Services (HHS) indicate Secretary Robert F. Kennedy Jr. is elevating substance use disorder (SUD) and mental health as key federal priorities heading into 2026.

Early signals suggest a strategic shift in the healthcare landscape:

• Policymakers are increasingly treating behavioral health conditions, which include mental health and SUD, as a chronic condition, with greater emphasis on prevention, early intervention, and access to emergency and youth behavioral health services before crises occur.

• Interest is also growing in innovative therapies, including novel serotonergic agonists, alongside stronger coordination between the Food and Drug Administration (FDA) and the Centers for Medicare and Medicaid Services (CMS).

• Partnerships with behavioral health providers and health plans will be important for enhancing a fragmented system, supporting the development of stronger quality metrics, more effective reimbursement models, and incentives for integration and innovation. 

Changes to the Pharmacy Ecosystem 

Prescription drug policy will remain one of the most important health policy areas to watch in 2026 as policymakers accelerate efforts to control costs while preserving access to innovation.

• Implementation of the Inflation Reduction Act’s drug price negotiation program will shift from rulemaking to real-world impact, with negotiated prices for the first set of high-cost Part D drugs taking effect this year.

• The Administration’s renewed interest in Most Favored Nation–style pricing, alongside the launch of TrumpRx.gov and select CMMI drug-pricing models, signals continued use of direct manufacturer pricing and transparency tools to lower drug costs.

• 2026 is also poised to be a pivotal year for Pharmacy Benefit Managers (PBMs) and pharmaceutical supply-chain reform, as new transparency, reporting, and compensation requirements target rebate and spread-pricing practices.

• • These dynamics are especially visible in the GLP-1 market, where rapid uptake is raising questions about affordability and coverage. 

• For plans, states, purchasers, and manufacturers, 2026 will require sharper tradeoffs among access, budget predictability, and pricing strategy as drug policy continues to evolve.

We are looking closely at the impact of those policies on the health care system overall, seeing the extent to which efforts address underlying concerns about the growth in drug costs and access to new therapies. 

Medicaid and State-Level Implementation of OBBBA 

On July 4, 2025, President Trump signed OBBBA (H.R. 1) into law, bringing significant changes to how Medicaid is delivered and financed in the U.S.

• The law includes Community Engagement Requirements, which require certain Medicaid beneficiaries to participate in community engagement activities as a condition of maintaining coverage.

• States are preparing to implement this requirement by January 1, 2027.  

Particular attention will be paid to Nebraska, one of the first states to implement community engagement requirements on May 1, 2026.

• Nebraska’s experience will offer early insights for other states as they prepare for implementation.

• At the same time, states will face administrative constraints as they balance routine Medicaid operations with new federal requirements, including more frequent eligibility redeterminations. 

These Medicaid policy and operational changes are taking place amid OBBBA-directed reductions in provider taxes and state-directed payments, which many states rely on to fund their Medicaid programs. 

The full impact of OBBBA will not occur until 2028, but state legislatures and governors’ proposed Fiscal Year 2027 budgets are serving as early indications of how states plan to address growing Medicaid budget deficits. 

Medicare Advantage 

In November 2025, CMS released the CY 2027 Medicare Advantage (MA) and Part D proposed rule, the first major MA rulemaking of the current Trump Administration. Rather than advancing sweeping reforms, CMS leveraged the proposed rule to signal broader efforts to modernize the MA program through targeted requests for information.

• These requests reflect the Administration’s interest in aligning MA with its Make America Healthy Again (MAHA) goals, including greater emphasis on wellness, nutrition, and prevention, alongside refinements to the Star Ratings and Quality Bonus Program, tighter risk adjustment, and an increased focus on beneficiary outcomes and experience. 

CMS reinforced this direction in January 2026 with the release of the CY 2027 MA Advance Notice, which projected an overall MA payment increase of just 0.09 percent, the lowest in recent history.

• This near-flat update is driven largely by proposed risk adjustment changes, including the exclusion of diagnoses from audio-only encounters and unlinked chart reviews, underscoring CMS’ focus on payment accuracy and program integrity. 

These changes unfold amid heightened bipartisan scrutiny of MA plans and increased public attention to practices like prior authorization. As CMS moves toward finalizing these policies, the remainder of 2026 is likely to see strategic recalibration across the MA market, with plans reassessing benefit design, coding practices, and quality investments in anticipation of a more outcomes-focused, constrained policy environment and potential payment pressures in 2027. This period also lays the groundwork for more significant reforms in future rulemaking cycles. 

Rural Health 

At the end of 2025, CMS announced the first round of funding for the Rural Health Transformation Program, with each state receiving more than $100 million for 2026.

The pressure is on for states to implement their programs quickly and sustainably. CMS will be paying close attention to which initiatives can scale nationally and which have the potential to meaningfully change how rural health care is delivered.

• State partners should be prepared to support implementation efforts to help ensure funding is sustained in future rounds. 

In 2026, key questions will include how states leverage rural health providers, adopt new technologies and vendors, achieve early workforce development wins, and use this funding to partly offset rural Medicaid reductions. 

Value-Based Care and CMMI 

2025 was a highly active year for CMMI and the continued push toward value-based care. Over the course of the year, CMMI announced several new models, including MAHA ELEVATE, LEAD, ACCESS, and GENEROUS, aimed at improving chronic disease management, addressing prescription drug costs, strengthening accountable care, and testing innovative technologies to improve outcomes. 

• Collectively, these models reflect a shift toward longer-term commitments, greater reliance on technology-enabled care, and approaches that span multiple settings and programs while expanding eligibility. 
• In doing so, CMS is setting clearer expectations for how care will be delivered and financed under Medicare. Providers and partners should begin assessing where and how to participate, rather than if they should participate. 

While results from this new crop of models are years away, we expect to learn much from the implementation process and engagement of providers with the administration. 

Concluding Thoughts 

As we look ahead, the policy environment will continue to evolve, shaped by regulatory action, legislative priorities, disruption, and broader system pressures. Debate and oversight in the political environment continues to shape implementation, though rising concerns about substantial health program fraud will dominate the discussion through the rest of the year, potentially sowing greater division. Anticipating what’s next, engaging at the right moments, and positioning for impact will be essential. In a year defined by transition and opportunity, informed strategy and thoughtful execution will make the difference.