Legislation in Federal

CMS Interim Final Rule on Medicaid Work Requirements Due June 1 — Will Define Exemptions, Reporting, and Enforcement

CMS must issue an Interim Final Rule by June 1, 2026 defining critical work requirement implementation details: exemption criteria, reporting mechanisms, compliance verification, and non-compliance consequences. The 80-hour/month requirement scope depends entirely on this rule — narrow exemptions could mean millions losing coverage, broad exemptions could limit damage. States must conduct member outreach June 30–August 31, 2026. CMS is distributing $200M in 'Government Efficiency Grants' for state tracking systems, but no direct funding flows to FQHCs despite bearing the patient-facing burden.

HRSA 340B Rebate Model RFI — Comment Deadline April 20

HRSA's Request for Information on the 340B rebate model closes April 20, 2026. FQHCs have a narrow window to shape how manufacturer rebates, contract pharmacy oversight, and documentation requirements are structured. Combined with 2026 Data Request List changes tightening contract pharmacy scrutiny, this deadline is the single most consequential 340B policy window of the year. NACHC is mobilizing comments.

HRSA 340B Rebate Model RFI: Comment Deadline April 20 — Possible Expansion to All IRA Drugs

After a Maine federal court vacated the original 340B rebate pilot program, HRSA is gathering stakeholder input with a 60-day comment window closing April 20. HRSA has signaled it may expand the rebate model to ALL drugs selected for Medicare price negotiation under the IRA through 2027. FQHCs that depend on 340B upfront discounts for cash flow could face a shift to delayed rebate payments — a devastating change for smaller FQHCs without reserves.

PhRMA Sues Washington State Over 340B Contract Pharmacy Law — Ruling Will Set National Precedent for CA AB 1460

The pharmaceutical industry trade group PhRMA filed suit April 15 against Washington State's SB 5981, which requires drug manufacturers to reimburse 340B-covered entities when contract pharmacies are used. If courts enjoin the law before its June 10 effective date, it will freeze similar CA legislative action (AB 1460); if SB 5981 survives, AB 1460 has a significantly clearer path to passage and enforcement. This is the most directly applicable state-level 340B precedent for California FQHCs in 2026.

House Passes Budget Reconciliation Framework April 10 — Medicaid Cuts Now Move to Senate

The U.S. House passed a budget reconciliation framework on April 10, 2026 enabling the Senate to proceed with work requirements, per-capita caps, and FMAP reductions. NACHC calls it the most consequential legislative vote for health centers in a generation — and is activating in-district advocacy through April 25.

Nebraska Becomes First State to Enforce Medicaid Work Requirements May 1

Nebraska will enforce 80-hour/month work requirements starting May 1, 2026 — 8 months ahead of the federal January 2027 mandate. This is the first real-world test of how work requirements affect community health center patient panels and revenue. KFF estimates work requirements nationally will leave 5.3 million newly uninsured. Nebraska CHCs will serve as the early warning system for California FQHCs.

HHS Shuts Down Minority Health Offices — CLAS Training Infrastructure at Risk for FQHCs

The CMS Office of Minority Health (~40 employees eliminated) and HHS Office of Minority Health have been restructured under federal cost-cutting. OMH sponsors Think Cultural Health and free CLAS Standards training that FQHCs rely on for staff cultural competency education. CMS funding would drop $674M, explicitly eliminating health equity funding categories. FQHCs may need to self-fund cultural competency training previously available free from HHS. FY2026 budget proposes ~26% cut to HHS discretionary spending.

Executive Order 14398 Bans DEI Activities by Federal Contractors — FQHCs as HRSA Grantees Face Compliance Risk

Trump signed EO 14398 prohibiting 'racially discriminatory DEI activities' by federal contractors and grantees. FQHCs receiving HRSA Section 330 grants face compliance deadlines: contract clauses (30 days), FAR guidance (May 25), agency reports (July 24). The EO creates direct tension with CLAS Standards requiring culturally concordant workforce recruitment. Violations can trigger contract termination, debarment, and False Claims Act liability. FQHCs with workforce diversity programs, culturally concordant hiring, or race/ethnicity-targeted training need compliance review.

Federal Register Rule Grants States Flexibility to Implement Medicaid Work Requirements Before January 2027 Deadline

An HHS rule published March 2, 2026 in the Federal Register (document 2026-04095) gives any state flexibility to implement Medicaid work requirements before the January 2027 federal statutory deadline — legally enabling Nebraska's May 1 launch and opening the door for Arizona, Nevada, or other states to move early. California FQHCs should monitor whether adjacent states activate, as each early-implementing state becomes the national warning data set for what arrives here in 2027.

Bipartisan Bill H.R. 7391 Would Exempt FQHCs from 340B Rebate Model — 35 Cosponsors

Reps. Auchincloss (D-MA) and Bergman (R-MI) introduced the Community Health Center Drug Pricing Protection Act to exempt FQHCs from HRSA's 340B Rebate Model Pilot Program. The bill mandates upfront ceiling-price purchasing — no post-purchase reconciliation. Currently has 35 cosponsors. HRSA's RFI on 340B rebates has comments due April 20, 2026. FQHCs account for 1% of healthcare spending but treat 10% of Americans.

Medicare Telehealth Distant-Site Flexibilities for FQHCs Extended Through Dec 31, 2027

The Consolidated Appropriations Act 2026 (H.R. 7148) extends FQHC/RHC ability to serve as Medicare distant-site telehealth providers for non-behavioral-health visits through December 31, 2027. This preserves a revenue stream and access pathway that would otherwise have sunset, giving FQHCs a 21-month planning horizon for telehealth program staffing, platform investment, and Medicare care-coordination workflow design. Behavioral health telehealth remains permanent.

H.R. 1 Signed: Largest Medicaid Cuts in U.S. History

The 'One Big Beautiful Bill' includes $1 trillion in national Medicaid cuts over 10 years, with California projected to lose $30 billion annually. Work requirements, enrollment freezes, and PPS rate changes directly threaten FQHC funding models.