With a new presidential administration, the changing regulatory landscape regarding health benefits—often, the second-largest expense for a business after salaries—has been top of mind for HR executives. Much of the early commentary focused on contested “red state/blue state” issues, such as gender-affirming care. The president’s ever-growing list of executive orders now gives us additional hints about the health benefits items that have attracted the administration’s interest and driven changes in health plan regulation trends.

Many assumed that the new administration would take more “industry” and employer-friendly approaches to regulation. In at least one instance, relating to healthcare data transparency, however, the administration has shown a bias in favor of consumers. Some, but not all, of the impetus for change is driven by ideology and/or rank political expediency. The interests and interest groups that supported the president will see their policy goals advance. There are separately a handful of items that fall under the heading of “unfinished” or even “new” business.

What we know so far about changing health plan regulation trends

Here are five items with respect to which we expect the new administration will either diverge from the prior administration or set an entirely new course.

Gender-affirming care

The new administration almost immediately signaled an all-out effort to reverse federal rules that treat gender identity, sexual orientation and pregnancy as protected classes. The broad reach of this effort was reflected in a Jan. 28 executive order entitled, “Protecting Children From Chemical And Surgical Mutilation,” which, among other things, directs federal agencies to work toward significantly limiting youth access to gender-affirming care nationwide.

The order will likely directly impact the government’s interpretation of the nondiscrimination provisions of Section 1557 of the Affordable Care Act. The impact on group health plans and providers will likely be immediate. The order appears to entirely misread or ignore relevant clinical evidence. Nevertheless, employers may need to revisit their plan designs, and providers will need to evaluate risks associated with this care. The greater pressure is on providers, however, as the order threatens their access to research and educational grants.

Telehealth HDHP Safe Harbor

During the COVID-19 pandemic, Congress temporarily relaxed the rules in governing access to telehealth with the enactment of the CARES Act. The law allowed high-deductible health plans to provide first-dollar telehealth coverage without preventing a covered individual’s ability to contribute to a health savings account (HSA). The rule was later extended for two years in the Consolidated Appropriations Act, 2023. The relief expired for plan years beginning on Jan. 1, 2025.

Telehealth has proven both popular and useful, particularly for rural populations. While the new administration might not object to an extension of telehealth access, the measure is costly, particularly if extended to Medicare. For this reason alone, the measure faced long odds—this despite that telehealth had become widely accepted by employers and payers alike. Employers and advocacy groups continue to advocate for an extension, which appears to have bipartisan support, and legislation has been introduced to codify the extension into law.

For the time being, employers should consider applying cost sharing to telehealth services for HDHP participants to avoid impairing their ability to make HSA contributions.

Pharmacy benefit manager (PBM) reform

Congress failed in the waning hours of 2024 to pass a bipartisan health policy package. The legislation would have:

• reformed certain practices of PBMs alleged to drive up prices for employer-sponsored group health plans;
• cracked down on pharmaceutical patent abuses;
• reined in hospital billing practices;
• and extended access to telehealth services.

The most often-cited proposed PBM reforms include a ban on spread pricing, a requirement of a full pass-through of manufacturer rebates and greater network access. These reforms and more are currently being implemented at the state level, as legislatures rush to fill the void left by Congress. As a result, employers should evaluate the extent to which they are subject to state PBM regulations, at least some of which may be preempted by ERISA.

Medical billing transparency

There is little doubt that the new administration is concerned about transparency of hospital prices. A Feb. 25 executive order seeks to directs the Departments of Health and Human Services, Labor and Treasury to enforce “the Trump healthcare price transparency regulations.”

These include a hospital price transparency rule, “Price Transparency Requirements for Hospitals To Make Standard Charges Public,” which requires hospitals to publish the prices they charged to various insurers for a set of common services; and a Transparency in Coverage (or TiC) regulation that requires group health plans and health insurance issuers to publish a comprehensive listing of the prices they negotiated with various healthcare providers. While the order by its terms is aimed at “hospitals and insurers,” hospitals tend to have the farthest to go to comply.

No Surprises Act/Federal Independent Dispute Resolution (IDR)

The IDR process adopted under the Consolidated Appropriations Act of 2021 has come under fire from both providers and payers, although the latter appear to have gotten the worst of it.

Complicating matters, the rules have been subject to a series of setbacks, which have triggered a dizzying array of regulatory pronouncements on the subject. Recently, it appears that providers have taken to using artificial intelligence to manage the IDR process, with predictably bizarre results.

(While AI may be quite competent at many things, conducting negotiations unsupervised to get at a qualified payment amount does not appear to be one of them.) While there have been some legislative proposals aimed at fixing the system (see, e.g., H.R. 9572, the Enhanced Enforcement of Health Coverage Act), these have gone nowhere. From a regulatory perspective, this rule is a “tear down.”

The new administration has a good deal of work to do.