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Good morning. Moody’s released its quarterly health care report on Tuesday. Let’s take a look at the highlights.

Moody’s quarterly paints a sobering picture for hospitals and health systems. The biggest headline, unsurprisingly, is that Medicaid cuts are coming—and they’re steep.

The newly enacted federal budget reconciliation law is projected to slash Medicaid spending by $1.1 trillion through 2034, compared to previous projections from the Congressional Budget Office. This could leave hospitals with more uninsured patients and fewer reimbursement dollars, especially safety-net and rural providers.

Congress’ next moves will determine the exact conditions of this new normal. If lawmakers do not extend expanded premium tax credits for the Affordable Care Act by the end of the year, the CBO estimates that the number of uninsured Americans would increase by at least 4.2 million. Republicans are not keen on this measure, but it’s still possible that they could compromise with Democrats to get other key GOP health care policies passed.

One of those key policies is pharmacy benefit manager (PBM) reform, something that, historically, has garnered bipartisan support. They’ve been criticized by lawmakers on both sides of the aisle for overcharging for medications. Cigna, CVS Health and UnitedHealth—which together own 80 percent of the PBM market—face a credit risk if the government does crack down, according to Moody’s. For more on the Congressional health care standoff, read on to the next section.

Insurers’ finances are also in a precarious position. On the bright side, CMS’ Medicare Advantage reimbursement rate is rising to 5.1 percent in 2026. This is likely to float the industry to more typical earnings and margins after a period of weak performance, Moody’s projects. But its analysts aren’t sure how long it will take to regulate. For now, they gave health insurers a “negative” outlook due to higher-than-expected spending, particularly on weight-loss drugs and behavioral health care.

I’ll end on a positive note. Moody’s analyzed CMS data, which suggests that the independent dispute resolution (IDR) process is becoming more efficient. The No Surprises Act (NSA) has been a headache for many providers since it was enacted in 2022, but the process is finally hitting its stride, per the numbers. New IDR claims continued to increase throughout 2024, but the number of resolved claims began to surpass new claims starting in the third quarter.

“This, along with a consistently high provider win rate in disputes, suggests a decline in NSA-related accounts receivable and an easing of liquidity stress,” Moody’s analysts said in the report.

How are you feeling about your organization’s financial situation as we head into the latter half of 2025? Let me know at a.kayser@newsweek.com.

In Other News

Major health care headlines from the week

  • Congressional Republicans are hoping to pass a bipartisan health care package by year’s end, with proposals to rein in pharmacy benefit managers (PBMs), expand Medicare coverage for weight-loss drugs and boost cancer screenings. But Democrats—frustrated by deep Medicaid cuts in the recent GOP megabill—are demanding Affordable Care Act tax credit extensions as a condition for talks, according to Politico.
    • The standoff highlights deep partisan tensions over health care, with both sides weighing how much they’re willing to trade to secure their policy wins.
  • Bankrupt hospital operator Steward Health Care has filed a lawsuit against its former CEO Ralph de la Torre and three other executives, alleging they harmed the company “through their greed and bad faith misconduct.”
    • A spokesperson for de la Torre told the Telegram & Gazette that he denies the allegations.
    • Massachusetts-based Steward filed for bankruptcy in May 2024, subsequently closing two hospitals and selling others. De la Torre has previously been criticized for buying a megayacht while the system was in financial and legal turmoil.
  • Hims & Hers is facing a lawsuit from a group of its shareholders, alleging the telehealth platform’s senior executives and board gave misleading statements to investors.
    • The plaintiffs claim that Hims & Hers misrepresented its short-lived partnership with Novo Nordisk, which was announced in April and terminated by the pharmaceutical company in late June. Hims & Hers allegedly told investors that it could offer both Novo Nordisk’s Wegovy and compounded semaglitude under the agreement—which Novo Nordisk has denied, calling the sale “deceptive” and claiming it “put patient safety at risk.”
    • The investors’ lawsuit also claims that Hims & Hers falsely represented the legality of compounded semaglutide sales, and told them it was compliant with FDA regulations.
  • The Alice L. Walton School of Medicine has officially opened in Bentonville, Arkansas, TIME reported. Walton—Walmart heiress and the world’s richest woman—will cover tuition for the first five graduating classes.

Pulse Check

Executive perspectives on key industry issues

Jannine Versi
Jannine Versi is the CEO and co-founder of Elektra Health.
Jannine Versi is the CEO and co-founder of Elektra Health.
Elektra Health

We’re gearing up for our Women’s Global Impact event on August 5 in New York City, and a number of health care leaders will be in attendance from companies like MUSC, the American Heart Association, Northwell Health and Virtua Health. During our health care spotlight panel, we’ll discuss the leadership gender gap in the industry and explore how women executives are working to bring more attention to female health issues.

For this week’s Pulse Check, I’m bringing you a sneak peek from my interview with Jannine Versi, co-founder and CEO of Elektra Health. The company aims to “smash the menopause taboo” via its telehealth clinic, educational materials and private community for women.

Here’s what Versi told me about her journey and priorities:

Has being a woman shaped your leadership style or the way that you think about your work in the health care industry?

Absolutely. I know what it feels to be dismissed or minimized or told by a provider “that’s just PMS” “or you need to manage your stress” in an offhanded way when something feels wrong.

In terms of my team, we are female-founded and predominantly identify as women, but I actually don’t think that changes how I try to lead — with urgency and empathy and also, with a high bar because our patients deserve the best.

Women make up 70 percent of the global health care workforce, but hold just 25 percent of the industry’s leadership positions. What do you make of this gender gap? How might we begin to close it?

This gap is a moral issue and a missed opportunity. Women are the engine of the health care system, yet their perspectives are often missing from the rooms where decisions get made. That disconnect affects everything from research agendas to benefit design.

We need more women at the helm of health systems, on investment committees and leading companies. But we also need systems that are built to retain and promote them. That means flexible leadership paths, accountability on gender metrics and real investment in women-led innovation. Put differently, I believe in the power of diversity, equity and inclusion.

I also want to call out a couple partner organizations – like the University of Pittsburgh Medical Center (UPMC) and Emblem Health — both led by women — which aren’t just talking about women’s health. They’re investing in it meaningfully because it’s smart and strategic for their business and the right thing to do in serving patients and members.

Meanwhile, I have heard for a long time from various payers and systems that they are “still figuring out” their women’s health strategy. I suspect some will regret not moving more swiftly because women are increasingly and rightly expecting better from their providers and insurers. That kind of leadership sets a new standard—and hopefully, it’s just the beginning.

Register here to see Versi speak live at Newsweek’s Women’s Global Impact Summit in New York City on August 5.

C-Suite Shuffles

Where health care leaders are coming and going

  • Bill Gassen has been named chair-elect of the American Hospital Association. The Sanford Health CEO will assume the seat in 2027, making him the AHA’s top elected official.
    • Gassen will be speaking at Newsweek’s Digital Health Care Forum on September 16 in New York City. I’ll be moderating the conversation, discussing the business case for technology and innovation. Click here to snag a ticket!
  • Howard University Hospital Corporation in Washington, D.C., has selected Kerry Watson as its interim CEO, effective August 1. This won’t be his first time at the safety-net health system; he worked there as an administrator from 1982 to 1992.
    • Watson has held numerous executive roles at health systems across the U.S., including service as interim CEO of UF Health St. Johns, CEO of Maui Health System and president of Wellstar Atlanta Medical Center (which shuttered in 2022).
  • UC Davis Health has announced three changes to its leadership team, selecting an interim CEO, interim vice chancellor of human health sciences and permanent dean of the School of Medicine.
    • Dr. David Lubarsky, former CEO and vice chancellor of human health sciences, retired in February to become president and CEO of Westchester Medical Center Health Network in his home state of New York.
    • The California health system has divided his former positions amongst Michael Condrin (interim CEO) and Dr. Bruce Lee Hall (interim vice chancellor of human health sciences). Condrin most recently served as UC Davis Medical Center’s chief operating officer, while Hall was the enterprise’s chief clinical officer.
    • Dr. Susan Murin assumed the top role at the School of Medicine in January, reporting to Hall. She has been with UC Davis Health for 29 years, previously as vice dean for clinical affairs and executive director of its medical group.

Executive Edge

How health care execs are managing their own health

Dr. Mitesh Rao
Dr. Mitesh Rao is the founder and CEO of OMNY Health.
Dr. Mitesh Rao is the founder and CEO of OMNY Health.
OMNY Health

For this week’s Executive Edge, I connected with Dr. Mitesh Rao, founder and CEO of the health care data platform OMNY Health. I’ve featured him before for his insights on wearable technology and how he uses it to monitor his health while balancing a busy work and travel schedule.

In late June, at a House Energy Committee hearing, HHS Secretary Robert F. Kennedy Jr., told lawmakers that wearables will be “key” to his “Make America Healthy Again” (or “MAHA”) agenda. He hopes that every American will be wearing one of these devices in the next four years—a goal that sparked significant debate about wearables’ data security and efficacy.

I followed up with Rao to get his latest take on wearable tech in health care. Here’s what he told me:

  • “Wearables have become a hot topic in health care, especially after RFK Jr. touted plans to get every American wearing one, then quickly backed off. I wear an Oura ring daily and have tried a variety of different wearables, including a Fitbit and a Google Watch, which I found more distracting than helpful.”
  • “What keeps me coming back to wearables isn’t the reminders to stand up or go for a walk–it’s the data. I enjoy seeing how my sleep quality changes after a long week of work travel, or how my body responds to things like a late dinner or a skipped workout. These are helpful personal reminders and insights, but it doesn’t necessarily mean I will eat dinner earlier tomorrow or skip my next work trip.”
  • “That said, I do see value in wearable data in the clinical setting, and research shows 94 percent of people who use one are open to sharing their data with their doctor. However, as someone who has devoted their career to democratizing access to health care data, I believe we need to address some major privacy concerns before rushing to use these insights for research.”
  • “Think about 23andMe. A few years ago, everyone was quick to take the saliva test, but when they filed for bankruptcy, people immediately realized ‘Wait, my DNA could be sold in a fire sale?'”
  • “If wearable data is going to be used responsibly, we must always make sure it benefits people more than it benefits platforms. This begins with transparency. Every time I’ve set up a new wearable device for myself, I’ve chosen not to allow it to share my data for ‘research’ because I’ve no insight into how or what is being done with that data, or how it will be secured and protected. Until this is made clear for users, we’re not ready to apply it meaningfully in health care.”

Before you go, check out Dr. Lawrence Rosenberg’s reflection on what “excellence” actually means in health care. He is the president and CEO of the Integrated Health & Social Services University Network for West-Central Montreal, and a member of Newsweek’s CEO Circle.

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