"Although the repeal of the individual mandate penalty will have negative effects across our health care system, the states can act to keep their health insurance markets stable and affordable by offsetting the expected coverage losses and premium increases beginning in 2019."  - Linda Blumberg, Urban Institute

The Trump administration is preparing a regulation that would allow the resumption of billions of dollars in payments to health insurers in Obamacare. The Centers for Medicare and Medicaid Services recently sent the Office of Management and Budget a rule on the risk-adjustment program, which transfers money to insurers who take on sicker customers. An administration official said the rule is an option being considered to resolve the legal dispute that has held up the payments. (Zachary Tracer, Bloomberg News)

President Donald Trump handed an influential business advocacy group what should have been a historic lobbying victory when he recently rolled out new rules encouraging small businesses to band together to offer health insurance. Trump, who's touted the expansion of so-called association health plans as a key plank in his strategy to tear down Obamacare, even announced the rules at the 75th anniversary party of the National Federation of Independent Business (NFIB) last month, claiming the group's members will save "massive amounts of money" and have better care if they join forces to offer coverage to workers. But the NFIB, which vigorously promoted association health plans for two decades, now says it won't set one up, describing the new Trump rules as unworkable. (Adam Cancryn, Politico)

A workaround by states to counter Trump administration cuts to Affordable Care Act subsidies has largely succeeded in protecting consumers from higher costs, California and 17 other states said. The assessment came late Monday in a court filing asking U.S. Judge Vince Chhabria to put a lawsuit involving the cuts on hold. The filing says states have mostly protected subsidized consumers by allowing insurers to raise premiums on some plans offered on health care exchanges. The increases triggered additional tax credits for users who qualify for subsidies on copays and deductibles, it states. The U.S. Department of Justice said it had no comment. .. The states joining California in the lawsuit are Connecticut, Delaware, Illinois, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, and Washington, along with the District of Columbia. (Sudhin Thanawala, Associated Press)

The heated debate over how Supreme Court nominee Brett Kavanaugh would vote on the Affordable Care Act might not matter. As long as five past defenders of the health care law remain on the nation's highest court, the odds tilt in favor of it being allowed to stand. Some Democrats are warning that President Donald Trump's designee could spell doom for the statute, even as some conservatives are portraying Kavanaugh as sympathetic to former President Barack Obama's landmark legislation. But where Kavanaugh would vote if he joins the Supreme Court is less clear than both sides suggest, according to an Associated Press review of the appeals court judge's decisions, other writings, and speeches. Kavanaugh could get to weigh in on the health care statute if the high court takes up a lawsuit brought by Texas and 19 other states. Those states are seeking to strike down the entire law because the Republican-backed tax overhaul removed fines for not having health insurance. (Alanna Durkin Richer and Dan Sewell, Associated Press)

The health department has quietly dipped into tens of millions of dollars to pay for the consequences of President Donald Trump's border policy, angering advocates who want the money spent on medical research, rural health programs, and other priorities. The Department of Health and Human Services has burned through at least $40 million in the past two months for the care and reunification of migrant children separated from their families at the border—with housing costs recently estimated at about $1.5 million per day. The ballooning costs have also prompted officials to prepare to shift more than $200 million from other HHS accounts, even as the White House weighs a request for additional funding for the Department of Homeland Security—a politically explosive move almost certain to antagonize fiscal hawks in the run-up to the midterm elections. (Dan Diamond, Politico)

U.S. regulators proposed new guidelines Tuesday to make it easier for some common medicines to be sold without a prescription—and more convenient for consumers to get them. The Food and Drug Administration (FDA) is evaluating ways to make sure patients don't take an inappropriate over-the-counter drug, Commissioner Scott Gottlieb said in a statement. That could include adding information to the packaging label and offering online questionnaires to help people decide if a drug is right for them. Drugmakers would have to do studies showing those strategies allow consumers to safely pick a drug and use it without medical supervision. (Linda A. Johnson, Associated Press)

It has been two months since the president released his road map for lowering drug costs that seems to lead nowhere, and about a month since he predicted the "big drug companies" would announce "voluntary massive" price cuts. Here's where things stand: A congressional investigation has found that the drug company Novartis got more out of its $1.2 million payment to Mr. Trump's "personal attorney" Michael Cohen than had been known. Meanwhile, several other drugmakers defied Mr. Trump's lofty prediction by raising their prices substantially, while his administration shot down a proposal that would have helped individual states lower their drug costs. Taken together, the developments help explain why, a year and a half after Mr. Trump took office, prescription drugs cost more than ever. (The Editorial Board, New York Times)

The Trump administration is cracking open the door to using prescription drugs imported from overseas—ones that have not been approved by the FDA—to combat high drug prices in limited circumstances. The FDA said Thursday that it plans to create a working group to examine how to safely import drugs in a specific situation: when there's a sharp price increase for an off-patent drug produced by a single manufacturer. (Laurie McGinley, Washington Post)

A federal judge's decision to bar Kentucky from imposing a work requirement on Medicaid recipients won't discourage the Trump administration from considering similar requests from other states, Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma said Tuesday at the POLITICO Pro summit. "We are very committed to this," Verma said. "We are looking at what the court said. We want to be respectful of the court's decision while also wanting to push ahead with our policy initiatives and our goals. … We are trying to figure out a path forward." Work requirements have already been approved in Arkansas, Indiana, and New Hampshire, while Arizona, Maine, Wisconsin, and Utah are waiting to hear from CMS. (Dan Goldberg, Politico)

The Trump administration is reviving its efforts to let Kentucky compel hundreds of thousands of poor residents to work or prepare for jobs to qualify for Medicaid, after a recent federal court order struck down the plan. Federal health officials have decided to consider for a second time the same application that Kentucky submitted last year. In an unorthodox maneuver, CMS has decided to open a fresh period for public comment on Kentucky's proposal to transform its Medicaid program, an agency spokesman confirmed Wednesday. (Amy Goldstein, Washington Post)

Dental and vision care benefits will be restored for hundreds of thousands of Medicaid recipients in a sudden reversal by Kentucky Gov. Matt Bevin's administration following an outcry over the recent cuts. The coverage had been abruptly cut at the start of July after a federal judge rejected the Republican governor's plan to overhaul Kentucky's Medicaid program. The cuts triggered stinging criticism from Democrats and public health advocates. The sudden about-face was announced late Thursday by the state's Cabinet for Health and Family Services and was welcomed by the administration's critics. (Bruce Schreiner, Associated Press)

When Medicare’s open enrollment period begins on Oct. 15, the private insurers that underwrite Medicare Advantage plans—which already lure seniors with things traditional Medicare can’t cover, like eyeglasses, hearing aids, and gym memberships—will be free to add a long list of new benefits. Among those CMS will now allow, if they’re deemed health-related: Adult day care programs. Home aides to help with activities of daily living, like bathing and dressing. Palliative care at home for some patients. Home safety devices and modifications like grab bars and wheelchair ramps. Transportation to medical appointments. (Paula Span, New York Times)