On the Margins -- Mar 25: CMS pairs Minnesota Medicaid fix with tougher...
On the Margins
Your daily health economics & actuarial brief
Wednesday, March 25, 2026
What's happening today
| ■ | CMS linked a Minnesota Medicaid fix to a tougher federal fraud funding threat. |
| ■ | CMS launched the ASPIRE model for children with complex medical needs, expanding value-based pediatric care through the Innovation Center. |
| ■ | CMS opened BALANCE applications after Lilly and Novo discount deals, testing a Medicare Part D path for GLP-1 access. |
Key Stories
CMS pairs Minnesota Medicaid fix with tougher federal fraud funding threat
CMS approved Minnesota's Medicaid corrective action plan in a March 19 letter to the state's Medicaid director. The approval followed CMS' January notice of several deficiencies in Minnesota's Dec. 31 submission and the state's revised Jan. 30 filing. KFF says CMS recently adopted a tougher fraud approach that relies more heavily on pausing or withholding significant federal Medicaid funding. That raises cash-flow risk for states, and could spill into MCO payments, provider reimbursement timing, and enrollment operations when integrity reviews escalate.
CMS launches ASPIRE model for children with complex medical needs
CMS on March 24 announced the ASPIRE model, a new pilot program for children and youth with complex medical needs. CMS says ASPIRE stands for Accelerating State Pediatric Innovation Readiness and Effectiveness. In a STAT opinion, CMS Administrator Mehmet Oz and CMMI Director Abe Sutton said the aim is to replace a "shoddy patchwork" of care with a more seamless system. The materials provided do not yet specify payment methodology, benchmarks, or model dollars, so the immediate finance signal is strategic direction rather than pricing detail.
CMS Opens BALANCE Applications After Lilly, Novo GLP-1 Deals
CMS on March 9 opened BALANCE applications for Medicaid agencies and Part D sponsors after completing GLP-1 pricing deals with Lilly and Novo Nordisk. Participating states can launch in May 2026, Medicare plans in January 2027, and CMS will cancel the Medicare rollout if projected plan participation stays below 80%. For 2027, BALANCE caps monthly member cost sharing at $50 in enhanced plans and $125 in basic alternative or actuarially equivalent plans. That pushes GLP-1 cost into 2027 bids, while CMS offers eligible high-use plans a first risk corridor of 2.5%, versus 5%.
Significant Digit
OIG's sample suggests many MA networks are contractually adequate on paper and economically thin where it matters.
HHS OIG found that across 40 Medicare Advantage plans in 10 selected counties, the average plan included only 16% of the local behavioral health workforce in network; Medicaid managed care plans averaged 31%. Three-quarters of the MA plans had less than 25% of local behavioral health providers in network. Thin networks do not just threaten access -- they raise out-of-network leakage, grievance exposure, and the odds that utilization management becomes a substitute for capacity.
Other Relevant Headlines
Policy & Regulation
| CMS Floats Automatic Medicare Advantage Enrollment, Mechanics Still Murky | r.smartbrief.com |
| Post-subsidy sticker shock hits ACA returners, KFF survey finds | KFF |
| Insurer and hospital lobbies tell administration to scrap proposal on non-network plans | Inside Health Policy |
| Aetna pays $117.7 million as government intensifies Medicare Advantage scrutiny | arnoldporter.com |
| HHS finalizes health care claims attachments, electronic signature rule | Inside Health Policy |
Payer Operations
| Highmark reports $175M net loss for 2025 as financial headwinds batter health plan | Fierce Healthcare |
| CommonSpirit, Humana reach new nationwide Medicare Advantage contract | Healthcare Dive |
Provider Economics
| Cencora acquiring EyeSouth Partners' retina business for $1.1B | Fierce Healthcare |
Pharmacy & Drug Pricing
| FTC strikes proposed deal with CVS over charges its PBM manipulated insulin prices, impeded access | STAT |
| U.S. drugmakers turn to China, raising stakes for domestic R&D | Inside Health Policy |
Digital Health & AI
| Qualified Health raises $125 million as it helps more health systems build and manage AI tools | STAT |
| Trump administration unveils national policy framework for AI as it moves to override state laws | Fierce Healthcare |
ICYMI (Recent Key Stories)
- Sutter's Allina acquisition creates a $26B nonprofit across three states -- Sutter's planned acquisition of Allina would form a $26 billion nonprofit health system spanning three states. (2026-03-24)
- Klomp floats automatic Medicare Advantage enrollment as policy option -- A policy proposal from Klomp suggests automatic enrollment into Medicare Advantage as an option for beneficiaries. (2026-03-23)
- Providence puts its health plan on the block, or close to it -- Providence is exploring a potential sale or divestiture of its health insurance plan. (2026-03-20)
- NIH tells House appropriators it will spend its full-year budget -- NIH told House appropriators it expects to use its entire budget allocation for the fiscal year. (2026-03-19)
- HIMSS26 spotlights CMS AI navigation push and payer data-trust risk -- At HIMSS26, speakers highlighted CMS's AI navigation efforts and concerns about payer data trust. (2026-03-18)