The Washington Report

May 21, 2025

Note to Subscribers

While we do our best to provide timely updates, it is possible that the information shared in the newsletter may change after our publication deadline.

Health

 

HHS Releases RFI on Unnecessary Regulations and Notice of Recission on Four Informal Guidance Documents
On May 13, 2025, the Department of Health and Human Services (HHS) issued a Request for Information (RFI) to “identify and eliminate outdated or unnecessary regulations. The initiative is part of a broader federal effort to reduce regulatory burdens and increase transparency, in alignment with President Trump’s Executive Order 14192, Unleashing Prosperity Through Deregulation.” Comments on the RFI are due by July 14, 2025. On the same day, HHS also released a Notice of Recissions, indicating that the Department is rescinding four informal guidance documents. The Notice declares that the following documents are rescinded, effective immediately:

• Extension of Designation of Scarce Materials or Threatened Materials Subject to COVID-19 Hoarding Prevention Measures; Extension of Effective Date With Modifications, 86 FR 35810 (July 7, 2021).
• Opioid Drugs in Maintenance and Detoxification Treatment of Opiate Addiction; Repeal of Current Regulations and Issuance of New Regulations: Delay of Effective Date and Resultant Amendments to the Final Rule, 66 FR 15347 (Mar. 19, 2001).
• Practice Guidelines for the Administration of Buprenorphine for Treating Opioid Use Disorder, 86 FR 22439 (Apr. 28, 2021).
• Notification of Interpretation and Enforcement of Section 1557 of the Affordable Care Act and Title IX of the Education Amendments of 1972, 86 FR 27984 (May 25, 2021).

The news release is available here.

The Notice of Recissions is available here.

The RFI is available here.

CMS Releases Draft Guidance for the Third Cycle Under Medicare Drug Price Negotiation Program
On May 12, 2025, the Department of Health and Human Services’ Centers for Medicare & Medicaid Services (CMS) issued draft guidance for public comment on the third cycle of negotiations under the Medicare Drug Price Negotiation Program. The draft guidance “includes policies that will improve the transparency of the Negotiation Program, prioritize the selection of prescription drugs with high costs to the Medicare program, and minimize any negative impacts of the negotiated maximum fair price on pharmaceutical innovation. Negotiations on the first set of 10 prescription drugs covered under Part D concluded in August 2024, and the second cycle of negotiations for 15 additional drugs covered under Part D are underway. CMS will announce up to 15 additional drugs covered under Part D or payable under Part B for potential negotiation in the third cycle of negotiations by February 1, 2026. This third cycle of negotiations will occur during 2026 and negotiated MFPs will be effective for this third set of drugs starting January 1, 2028. Additionally, CMS will publish the selected drug list for negotiation for initial price applicability year 2028 by February 1, 2026. At the same time CMS will announce any drugs selected for the first cycle of renegotiation, with renegotiated prices also taking effect on January 1, 2028.” Comments are due by June 26, 2025. 

The news release is available here.

The draft guidance is available here.

A Fact Sheet is available here.

Aon Publications

 

Client Alert: Recent Court Decisions and Strategies for Plan Fiduciaries to Consider
The decisions-making processes of plan fiduciaries continue to receive scrutiny. Two recent court decisions have underscored the importance of having a strong governance process when it comes to selecting retirement plan service providers and determining fees and expenses. 

• In an April 17, 2025, U.S. Supreme Court decision, Cunningham v. Cornell University, the Court permitted plaintiffs to pursue their claims that the plan fiduciaries engaged in a prohibited transaction and paid excessive fees and expenses when they selected a service provider. The decision was unusual in that the Court permitted the plaintiffs to pursue their claims without necessarily requiring that they explain why they thought that the fees and expenses were unreasonable
• While most ERISA cases do not involve juries, another recent case (Khan v. Board of Directors of Pentegra Defined Contribution Plan) alleging that the fiduciaries were paying unreasonable administrative and investment management fees was tried before a jury. Following a multi-day trial, the jury awarded the plaintiffs $38 million. Since the jury award was announced, the parties have now tentatively agreed to a settlement.

Aon’s Retirement practice has prepared a Client Alert with details on these decisions along with strategies that employers and plan fiduciaries may consider to mitigate the risk of adverse claims or litigation in the future. 

The Aon Client Alert is available here.

Trump Administration Seeks “Most-Favored-Nation” Drug Prices From Drug Manufacturers
The Trump Administration issued an Executive Order (EO) on May 12, 2025, seeking to establish “Most-Favored-Nation” (MFN) pricing from prescription drug manufacturers for prescription drugs sold to Americans and to allow consumers to purchase prescription drugs directly from drug manufacturers at MFN prices. 

The EO, entitled “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients,” would, presumably, apply to public and private payers, including Medicare, Medicaid, employer-sponsored group health plans, and individuals. However, the EO does not outline the legal mechanism for imposing MFN prices if prescription drug manufacturers fail to offer MFN prices. 

The Aon bulletin is available here.

Trump Administration Will Stay Enforcement of Biden-Era MHP Rule, but Pre-2024 MHP Rules Remain in Effect
The Trump Administration announced May 12, 2025, that it will stay enforcement of the Biden Administration's final rule issued in 2024 implementing requirements under the Mental Health Parity and Addiction Equity Act (the MHPAEA) (the 2024 Final Rule). In addition to the stay, announced as part of a lawsuit brought by ERIC, the Administration also announced that the Departments of Labor, Health and Human Services, and the Treasury intend to reconsider the 2024 Final Rule, including whether to rescind or modify it. 

The Aon bulletin is available here.

CMS Finalizes Instructions on Impact of Inflation Reduction Act on Creditable Coverage Testing for Employer Plans
The Centers for Medicare & Medicaid Services (CMS) has issued final instructions that introduce a new simplified method that allows employer-sponsored prescription drug plans to demonstrate that they remain “creditable” for Medicare Part D purposes in 2026. 

The Aon bulletin is available here.