CMS under Dr. Oz: 10 key actions

By Alan Condon / June 3, 2025

CMS Administrator Mehmet Oz, MD, is charting an ambitious course for the agency, pledging to align federal healthcare policy with President Donald Trump’s “Make America Healthy Again” agenda while pushing for sweeping reforms across Medicaid, Medicare and the ACA marketplace.

From plans to close a Medicaid funding “loophole” to probing hospitals over gender care for minors and clamping down on states using federal Medicaid funds to treat undocumented migrants, here are 10 key actions CMS has taken since Dr. Oz was confirmed as administrator:

1. CMS proposed a rule to close what it describes as a Medicaid tax “loophole” that some states have used to increase federal payments while limiting their own financial contributions. The proposed rule aims to ensure that federal Medicaid dollars are used to support vulnerable populations rather than being redirected to fund other state programs, including healthcare coverage for undocumented immigrants.

“States are gaming the system — creating complex tax schemes that shift their responsibility to invest in Medicaid and rob federal taxpayers,” Dr. Oz said. “This proposed rule stops the shell game and ensures federal Medicaid dollars go where they’re needed most — to pay for health care for vulnerable Americans who rely on this program, not to plug state budget holes or bankroll benefits for noncitizens.”

2. CMS is ramping up federal oversight to prevent states from “misusing” Medicaid funds to cover care for undocumented immigrants. While federal Medicaid dollars are generally limited to emergency services for “noncitizens with unsatisfactory immigration status” who meet specific eligibility criteria, CMS argues that some states have expanded benefits beyond what is permitted — shifting additional costs to federal taxpayers.

“Medicaid is not, and cannot be, a backdoor pathway to subsidize open borders,” Dr. Oz said. “States have a duty to uphold the law and protect taxpayer funds. We are putting them on notice — CMS will not allow federal dollars to be diverted to cover those who are not lawfully eligible.”

3. CMS on June 3 withdrew a 2022 guidance issued under the Biden administration that reinforced hospitals’ obligations to provide emergency abortion care under the Emergency Medical Treatment and Labor Act. The move effectively removes federal protections for clinicians who offer such care in states where abortion is restricted or banned.

The original guidance, issued in July 2022 shortly after the Supreme Court overturned Roe V. Wade, clarified that clinicians treating pregnant patients in emergency departments — including providing abortions — were protected under EMTALA, regardless of conflicting state laws. Enacted in 1986, EMTALA requires Medicare-participating hospitals to provide appropriate emergency care to all patients.

Although the guidance has been withdrawn, CMS said it will continue to enforce EMTALA in cases where the health of a pregnant woman or her unborn child is at risk.

4. CMS is investigating an undisclosed number of hospitals that provide gender-confirming care to minors.

In a letter sent May 28 to “select hospitals,” Dr. Oz outlined concerns about clinical standards and potential financial incentives associated with treatments such as puberty blockers, cross-sex hormones and sex trait modification surgeries. CMS is requesting that hospitals respond within 30 days with detailed information on informed consent practices for pediatric patients, updates to clinical guidelines, documentation of adverse outcomes, and financial data — including facility- and provider-level revenue and profit related to such care.

“These are irreversible, high-risk procedures being conducted on vulnerable children, often at taxpayer expense,” Dr. Oz said. “Hospitals accepting federal funds are expected to meet rigorous quality standards and uphold the highest level of stewardship when it comes to public resources — we will not turn a blind eye to procedures that lack a solid foundation of evidence and may result in lifelong harm.”

5. On May 22, CMS issued updated price transparency requiring hospitals to publicly post actual prices for items and services — not estimates. The update follows an executive order from President Trump aimed at increasing transparency in healthcare pricing.

Under the revised rules, hospitals must display payer-specific standard charges as dollar amounts in their machine-readable files whenever those amounts can be calculated. This includes negotiated rates for individual services, base rates for bundled service packages, and dollar amounts derived from percentage-based fee schedules.

CMS also directed hospitals to stop using placeholder codes — specifically “999999999” — in the “estimated allowed amount” field of machine-readable files. Instead, hospitals must input actual dollar values, using electronic remittance data from the prior 12 months to calculate those estimates. The agency is soliciting public feedback through July 21 on strategies to strengthen compliance, enforcement and data accuracy.

6. On April 4, CMS published its final rule for Medicare Advantage and Part D in 2026. While the final rule solidifies several changes — including measures to streamline prior authorization, tighten oversight of supplemental benefits and codify provisions from the Inflation Reduction Act — CMS stopped short of addressing two of the most closely watched issues: expanding coverage for GLP-1s under Medicare and Medicaid, and regulating the use of AI in prior authorization. Those decisions have been deferred to future rulemaking.

7. CMS plans to increase payments to MA plans by more than $25 billion in 2026. MA plans can expect a payment increase of 5.03% in 2026, more than double what the Biden administration proposed. The agency will continue the final year of the phase-in of risk-adjustment changes, shifting MA’s diagnosing coding from ICD-9 to ICD-10 and remove certain codes from the hierarchical condition categories model.

8. CMS plans to audit every MA plan annually as part of what it calls an “aggressive” effort to strengthen oversight and address potential overpayments. The agency currently audits about 60 plans each year but intends to expand that to all 500-plus MA plans moving forward.

In addition to the expanded audit scope, CMS said it will intensify efforts to recover uncollected overpayments from previous audits and complete outstanding reviews from 2018 through 2024. The last major recovery effort targeted plan year 2007. To support this initiative, CMS plans to grow its team of medical coders from 40 to approximately 2,000 by Sept. 1 and will deploy “enhanced technology” to streamline the review of medical records.

“While the administration values the work that Medicare Advantage plans do, it is time CMS faithfully executes its duty to audit these plans and ensure they are billing the government accurately for the coverage they provide to Medicare patients,” Dr. Oz said. 

9. On April 10, CMS said it is halting federal matching funds for state expenditures on designated state health programs (DSHP) and designated state investment programs (DSIP) “to preserve the core mission of the Medicaid program.”

10. In early April, CMS proposed a series of payment updates across multiple care settings for fiscal 2026, including a 2.4% payment increase for inpatient hospitals, equating to a $4 billion funding increase.