States of Innovation: September 2025
In September, states reacted to federal policy, by taking action to safeguard health coverage. New Mexico announced a special legislative session to address federal funding cuts made by H.R.1 and New York will transition its Essential Plan back to a Basic Health Program to minimize coverage losses due to federal funding eliminated by H.R.1. States responded to federal changes to vaccine policy by taking steps to protect vaccine access with the creation of the West Coast Health Alliance and the Northeast Public Health Alliance, and states including Arizona, Colorado, Illinois, Michigan, New Jersey, North Carolina, Vermont and Wisconsin issued standing orders for the COVID vaccine. In September, CMS released the Notice of Funding Opportunity for the Rural Health Transformation Fund, authorized under H.R.1, and many states took action to prepare for and apply for the fund. SHVS continues to update our expert perspective tracking state action, including issuing requests for information and other efforts to educate the public and gather stakeholder input.
A significant issue for states in September was the upcoming expiration of the enhanced premium tax credits. In separate letters, governors in 18 states and State-Based Marketplace leaders urged Congress to extend Marketplace affordability. Pennsylvania launched an educational tour to prepare enrollees for premium increases and highlight the value of Marketplace coverage. Rhode Island will seek to address the cost of health insurance in the next legislative session by directing the Office of the Health Insurance Commissioner to undertake an aggressive review of the drivers of premiums.
Also in September, Illinois released a Birth Equity Blueprint to improve maternal and infant health, while state action to address mental and behavioral health included Connecticut establishing an Office of the Behavioral Health Advocate, and New Jersey allocating opioid settlement funds to expand harm reduction services. To expand access to care, Massachusetts appropriated funding for hospitals and community health centers servicing low-income patients.
State action on Medicaid policy included Georgia obtaining CMS waiver approval to amend its section 1115 demonstration to decrease the frequency of required enrollee reporting from monthly to annually, and Montana submitting a request for a new 1115 waiver to require enrollees to pay premiums and either work, pursue job training or education, or engage in community service activities. Meanwhile, North Carolina’s governor highlighted the value of Medicaid and called on the state’s general assembly to fully fund the state’s Medicaid program.
Accessibility
New York is expanding access to healthcare for people with developmental disabilities. Governor Kathy Hochul announced that $25 million in capital project grants will go toward the development of Regional Disability Health Clinics through the New York State Office for People With Developmental Disabilities (OPWDD). Application criteria include capital projects that improve access and quality of services (e.g., medical, dental, nursing, physical therapy, occupational therapy, speech and language pathology) specifically for people with developmental disabilities. OPWDD will prioritize projects related to opening new dental services or expanding/enhancing existing dental clinics, improving physical space to better accommodate wheelchairs, or create sensory-friendly spaces, and improving access in healthcare deserts.
Affordability and Efforts to Address Cost
Colorado is increasing price transparency. Governor Polis and the Division of Insurance announced that Colorado-specific provider and drug pricing information has been collected for the first time since the passage of SB24-080 in 2024. Colorado’s data requirements will result in cleaner data that is easier to understand for the average consumer about costs. The Division will compile the data and make it available to consumers and researchers by early next year.
Oklahoma is regulating pharmacy benefit managers. Oklahoma Attorney General Gentner Drummond announced a more than $32 million settlement with CVS Caremark, a pharmacy benefit manager that manages prescription drug benefits, after the company allegedly kept money that belonged to Oklahoma’s state employee health plan. The settlement ensures millions of dollars will be directed back to the state employee plan and strengthens contract language that requires Caremark to report and remit all rebates collected to the state plan on a quarterly basis, ensuring greater transparency and accountability.
Rhode Island will seek to contain the cost of health insurance. Ahead of the upcoming legislative session, Governor Dan McKee has directed the Office of the Health Insurance Commissioner (OHIC) to undertake an aggressive review of the drivers of health insurance premiums and identify ways to control these costs. In a letter sent to Health Insurance Commissioner Cory King, the Governor highlighted several key priorities to be addressed in the legislative proposal: placing a cap on drivers of premium costs, such as administrative charges; strengthening OHIC’s statutory authority to contain overall premium costs beyond what is currently permitted by law; implementing a temporary moratorium on new unfunded health insurance mandates, giving time to assess the cumulative cost of existing requirements and ensure future mandates don’t unintentionally raise premiums.
Coverage for Justice-Involved Populations
Michigan’s Bed Management Tool will improve juvenile justice placements. The Michigan Department of Health and Human Services announced the statewide launch of its Bed Management Tool, a digital platform designed to strengthen youth placement coordination and enhance real-time reporting across Michigan’s juvenile justice system. Developed in partnership with the University of Michigan’s Child and Adolescent Data Lab, the Bed Management Tool provides up-to-date information on available juvenile justice beds statewide, reducing delays and administrative burden while helping youth receive timely, appropriate care.
Expanding Access to Care
The District of Columbia launched its website for the new Basic Health Program. DC Health Link, the District’s official health insurance Marketplace, launched a website highlighting the Healthy DC Plan, a new Basic Health Program for District residents with an annual income between 138% to 200% of the federal poverty level, with no out-of-pocket costs and coverage of essential health benefits. Individuals who are losing Medicaid coverage due to eligibility changes will be automatically enrolled and other eligible residents can enroll in the plan during the upcoming open enrollment period, with coverage beginning January 1, 2026.
Massachusetts appropriated funding for hospitals and community health centers. Governor Maura Healey signed a bill providing critical funding for hospitals and community health centers in Massachusetts. The bill includes $122 million for acute care hospitals serving a high percentage of low-income patients and in financial distress; $77 million for the Health Safety Net Trust Fund to reimburse hospitals and community health centers for services provided to uninsured and underinsured individuals; and an additional $35 million to community health centers and hospital licensed health centers.
Extending Marketplace Affordability
Governors joined together to call on Congress to extend the ePTCs. Governors in 18 states (CA, CO, CT, DE, IL, KY, MA, MD, MI, MN, NC, NJ, NM, NY, OR, RI, WA & WI) signed a joint letter to Congress urging for the extension of the enhanced premium tax credits (ePTCs) to keep healthcare affordable and provide stability for families.
State-Based Marketplace leadership issued a joint letter to Congress urging for the extension of the ePTCs. Leadership from the State-Based Marketplaces (CA, CO, CT, DC, ID, IL, KY, MA, MD, ME, MN, NJ, NM, NY, OR, PA, RI, VA, VT & WA) submitted a letter to Congress, urging for the extension of the enhanced premium tax credits by the end of September.
Colorado called on its Congressional delegation to extend the ePTCs. Governor Jared Polis and Lieutenant Governor Dianne Primavera sent a letter to Colorado’s Congressional delegation calling on them to extend the ePTCs by the end of September. This follows a roundtable discussion Governor Polis hosted with community members and local elected officials to discuss how if the credits expire, average premium increases will exceed 170% for Colorado Marketplace consumers, with rural counties facing increases of more than 300%. Governor Polis emphasized that while Colorado has taken steps–including signing legislation to strengthen the reinsurance program and reduce private insurance costs–state action alone cannot offset the consequences of federal inaction.
Maine called on its Congressional delegation to extend the ePTCs. Governor Janet Mills is urging Congress to extend the enhanced premium tax credits. In a letter to Maine’s congressional delegation, Governor Mills warned that failure to extend the tax credit could cause monthly health premiums to increase by as much as 117%. The Bureau of Insurance (BOI) announced it has approved an average rate increase of 23.9% for the individual market and 17.5% for the small employer market. BOI Superintendent Bob Carey authored an op-ed describing how the increase in premiums threatens the coverage gains that the state has made.
Maryland created a new state-funded subsidy program to protect against the expiration of ePTCs. Maryland Insurance Commissioner Marie Grant announced the premium rates approved by the Maryland Insurance Administration, which will increase by an average of 13.4% in the individual market largely due to the impacts of expiring federal tax credits. The Maryland Health Benefit Exchange announced that the state has created a new state subsidy program to help offset the increases, which will lower eligible Marylanders’ premium costs by on average two-thirds.
Minnesota sounded the alarm about the expiration of the ePTCs. Department of Commerce Commissioner Grace Arnold, MNsure’s Senior Director of Public Affairs Erika Helvick Anderson, and State Representative Robert Bierman held a press conference to sound the alarm about dramatic increases in health insurance costs for Minnesotans, driven by recent federal policy changes and the pending expiration of enhanced federal subsidies. Governor Tim Walz also convened a roundtable discussion with state leaders and healthcare experts to address the rising cost of health insurance in Minnesota, focused on the impacts of H.R.1. Minnesota has acted to stabilize the market by extending the Minnesota Premium Security Plan, a reinsurance program that offsets high-cost claims and stabilizes premiums. Without this program, 2026 premiums would have risen nearly 25% higher than projected. However, state leaders emphasized that state efforts alone cannot fully offset the effects of harmful federal policy.
North Carolina sent a letter to Congress calling for the extension of the ePTCs. Governor Josh Stein sent a letter to Congress to extend the ePTCs in order to protect North Carolinians from skyrocketing healthcare costs. Without congressional action, 157,000 North Carolinians will become uninsured and another 888,000 will see their healthcare premiums double.
Highlighting the Value of Marketplace Coverage
Pennsylvania is preparing enrollees for open enrollment and the changes coming to their coverage. The Pennsylvania Insurance Department (PID) launched an educational tour to prepare Pennsylvanians for significant health insurance premium increases for the upcoming year. PID will host free, in-person educational sessions in communities across the Commonwealth to explain the rate review process and PID’s role in regulating the health insurance market; provide an overview of the factors influencing premiums next year; offer guidance on how to compare plans, costs, and provider networks during open enrollment; and share tools and resources to help Pennsylvanians find coverage.
Highlighting the Value of Medicaid
North Carolina’s governor urged the state general assembly to reverse cuts to Medicaid. With Medicaid funding cuts going into effect in October because of the state General Assembly’s inaction, Governor Josh Stein joined affected North Carolinians to urge the General Assembly to reverse the cuts by fully funding North Carolina’s Medicaid program. The North Carolina Department of Health and Human Services (NCDHHS) provided information to all providers outlining the new rates that will be in effect October 1 as a result of insufficient funding. Governor Stein instructed NCDHHS to look for cuts that are reversible in the event that the General Assembly does provide the additional funding needed for the Medicaid program.
Maternal and Infant Health
Illinois released a blueprint for improving maternal and infant health. Governor JB Pritzker, Lieutenant Governor Stratton, and the Illinois Department of Public Health released the Illinois Birth Equity Blueprint—a roadmap designed to improve maternal healthcare and birth outcomes in Illinois. The Blueprint is a multi-agency initiative which outlines four strategic priorities to improve maternal health and identifies systemic inequities in maternal healthcare and birth outcomes due to systemic racism and geographic inequalities.
Mental and Behavioral Health
Connecticut established the Office of the Behavioral Health Advocate. Governor Lamont announced the establishment of the Connecticut Office of the Behavioral Health Advocate, a new independent state office statutorily assigned to assist residents with accessing mental health and behavioral healthcare resources, supporting behavioral health providers with receiving timely payments and advocating for greater access, with the overarching goal of improving consumer outcomes.
Michigan published an analysis of the effectiveness of harm reduction programs. The Michigan Department of Health and Human Services released a new modeling study finding that harm reduction programs have saved lives, reduced hospitalizations and emergency department visits and prevented hepatitis C cases.
New Jersey is allocating funding from the Opioid Recovery and Remediation Fund to improve community-based supports. Governor Phil Murphy announced an investment of $130.7 million in opioid settlement funds to expand harm reduction services and launch a new wave of community-based support initiatives for families impacted by substance-use. Funding will support $118.7 million over five and a half years for the continuation and expansion of Harm Reduction Centers, and $12 million over three years in direct grants to family and community support organizations. This follows an additional allocation by Governor Murphy of $10.85 million from New Jersey’s Opioid Recovery and Remediation Fund to support ongoing efforts to address the opioid crisis, including recovery and overdose prevention services that meet people where they are and promote long-term recovery.
Protecting Vaccine Access
California, Hawaii, Oregon and Washington launched an alliance to protect public health. Governors in California, Oregon and Washington announced the launch of a new West Coast Health Alliance to provide evidence-based unified recommendations to their residents regarding who should receive immunizations and to help ensure the public has access and credible information for confidence in vaccine safety and efficacy. Hawaii subsequently joined the alliance and issued an emergency proclamation that allows pharmacists to continue providing the vaccine to anyone aged three and older who wants it, in accordance with the West Coast Health Alliance COVID-19 vaccine recommendations.
Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Pennsylvania, Rhode Island and New York launched an alliance. Several states announced the Northeast Public Health Collaborative, a voluntary regional coalition of public health agencies and leaders, brought together to share expertise, improve coordination, enhance capacity, strengthen regional readiness, and promote and protect evidence-based public health. The Collaborative’s shared purpose is to work together to share resources, respond to public health threats, advance community health and strengthen confidence in vaccines and science-based medicine.
Arizona issued a standing order for the COVID vaccine. Governor Katie Hobbs announced that the Arizona Department of Health Services (ADHS) issued a standing order ensuring access to the COVID-19 vaccine for all Arizonans ages six months and older. This comes after Governor Hobbs signed an executive order directing ADHS to make the updated COVID-19 vaccine broadly accessible and available to Arizonans who want one.
Colorado issued a public health order and standing order for the COVID vaccine. Governor Jared Polis directed the Colorado Department of Public Health and Environment (CDPHE) to ensure that all Coloradans have access to updated COVID-19 vaccines. CDPHE Executive Director Jill Hunsaker Ryan issued a public health order, and Chief Medical Officer Dr. Ned Calonge issued a standing order to allow pharmacists to provide COVID-19 vaccines without individual prescriptions.
Connecticut protected COVID vaccine access through executive actions. Governor Ned Lamont announced a series of executive actions his administration is implementing to ensure that Connecticut residents who wish to be vaccinated continue to have access and that coverage under state-regulated health insurance policies remains uninterrupted. The Connecticut Department of Public Health released interim guidance on who should receive COVID vaccines, the Department of Consumer Protection issued guidance on distribution of vaccines to pharmacists, and the Connecticut Insurance Department issued a bulletin on insurance coverage.
Illinois issued a standing order to protect COVID vaccine access. Dr. Sameer Vohra, Director of the Illinois Department of Public Health signed a standing order that will allow residents to access the COVID-19 vaccine, and endorsed the recommendations of the Illinois Immunization Advisory Committee. These actions follow Governor Pritzker’s September 12 executive order to protect immunization access for Illinoisans.
Maryland ensured residents that vaccines are covered under their insurance. The Maryland Insurance Administration reminded residents that many vaccinations and immunizations continue to be covered by private insurers and Medicaid under Maryland law. Governor Wes Moore signed legislation earlier this year to ensure carriers cover the cost of all vaccines recommended by the Advisory Committee on Immunization Practices (ACIP) as of December 31, 2024. Effective June 1, 2025, this legislation protects against the withdrawal of vaccine coverage for a range of illnesses, including COVID-19. In addition, in 2024, Governor Moore signed into law legislation to expand vaccination authority for pharmacists, allowing them to administer flu and COVID vaccines without a prescription to anyone three years and older. This month, the Maryland Department of Health issued a standing order to ensure COVID-19 vaccine access and also shared clinical vaccine guidance for healthcare providers and vaccine recommendations for individuals for the 2025 through 2026 respiratory virus season.
Massachusetts issued a standing order and other efforts to preserve COVID vaccine access. Governor Maura Healey announced a series of measures to ensure vaccine access. The Division of Insurance and Department of Public Health (DPH) issued a bulletin that requires insurance carriers to continue to cover vaccines recommended by DPH and not rely solely on CDC recommendations. DPH issued a standing order to allow pharmacies to continue to provide COVID vaccines to residents aged five and older and updated its vaccine administration policy to permit the DPH Commissioner to determine which routine vaccines can be administered. Massachusetts is also leading efforts to create a public health collaboration with states in New England and across the Northeast committed to safeguarding public health.
Michigan removed barriers to COVID vaccines through an executive directive. Governor Gretchen Whitmer signed an executive directive, ensuring vaccines remain available to Michiganders, instructing state agencies to identify and remove any barriers to accessing COVID-19 vaccines. In response to the executive directive, the state’s Chief Medical Executive Dr. Natasha Bagdasarian has issued a standing recommendation for the COVID-19 vaccine.
Minnesota’s Governor issued an executive order to preserve COVID vaccine access. Governor Tim Walz issued an executive order directing the Minnesota Department of Health (MDH) to expand its efforts to safeguard vaccine access. The executive order also directs the state epidemiologist to issue a standing order for the COVID-19 vaccine, which would provide greater flexibility for healthcare providers and pharmacists to provide the vaccine.
New Jersey made several executive actions to continue COVID vaccine accessibility. The New Jersey Department of Health announced it has issued Executive Directive No. 25-003, allowing anyone six months of age and older to receive a COVID-19 vaccine for the 2025 through 2026 respiratory illness season. The Department also issued a standing order authorizing pharmacists to administer COVID-19 immunizations without a prescription. Additionally, the New Jersey Department of Banking and Insurance issued a bulletin advising insurance carriers to continue to cover the cost of COVID-19 vaccines without cost-sharing, and in a letter to Medicaid providers and managed care organizations, the Department of Human Services Division of Medical Assistance & Health Services clarified that FamilyCare, New Jersey’s Medicaid program, will continue to cover COVID-19 vaccines.
New Mexico ensured residents will be able to access the COVID vaccine. The New Mexico Department of Health (NMDOH) issued a public health order to ensure all New Mexicans can access the COVID-19 vaccine. NMDOH will work with New Mexico’s Board of Pharmacy to remove potential barriers and ensure access to COVID-19 vaccines at pharmacies across the state. Superintendent of Insurance Alice Kane issued a bulletin that declares any changes to coverage for immunizations based on Advisory Committee on Immunization Practices (ACIP) guidance should be prospective to the 2027 plan year, as carriers have already included cost and coverage for immunizations in rates for plan years 2025 and 2026.
New York issued guidance for insurers and an executive order to protect COVID vaccine access. Governor Hochul issued an executive order allowing pharmacists to administer COVID vaccines to ensure New Yorkers can receive the updated COVID shot. The New York State Department of Financial Services (DFS) issued guidance encouraging insurers to continue covering all vaccines recommended by ACIP as of September 2025. In addition, the new guidance urges insurers to encourage employers and other entities who provide self-funded healthcare coverage to continue covering the cost of vaccines. DFS also reminded insurers of previous guidance requiring coverage of COVID vaccines for children.
North Carolina issued a standing order for the COVID vaccine. North Carolina Department of Health and Human Services Chief Medical Officer and State Health Director Dr. Larry Greenblatt, issued standing orders that allow seniors 65 years or older and adults over 18 years who meet certain criteria to get a COVID-19 vaccine at a pharmacy without a prescription.
Pennsylvania will follow vaccine recommendations of trusted authorities outside of ACIP. Governor Josh Shapiro called on the State Board of Pharmacy to protect COVID-19 vaccine access. In response, the Board voted to allow pharmacists across the state to follow the vaccine recommendations of other trusted authorities. Additionally, the State Board of Medicine, State Board of Nursing, and State Board of Osteopathic Medicine all voted to endorse the Pennsylvania Department of Health’s (DOH) new vaccine guidance, ensuring Pennsylvanians and their healthcare providers have clear, evidence-based information to protect themselves and their families. By formally endorsing DOH’s issuance of guidance, the boards are giving clarity to doctors and the public, reinforcing patient protections, and ensuring continued access to vaccines across the Commonwealth.
Rhode Island issued a standing order for the COVID vaccine and issued a bulletin to insurers. Governor Dan McKee announced immediate measures to ensure continued access to the COVID-19 vaccine. The Rhode Island Department of Health (RIDOH) and OHIC issued a bulletin to insurers to ensure coverage of the vaccine according to recommendations by major medical organizations. RIDOH also issued a standing order to allow pharmacists to administer the 2025 to 2026 COVID-19 vaccine to all patients who are three years of age and older, independent of the FDA indications.
Vermont issued a standing order for the COVID vaccine. The Department of Health issued a standing order allowing for the administration of the COVID vaccine based on guidance from national medical associations, enabling pharmacies to administer the vaccine to Vermonters who choose to receive one.
Wisconsin issued an executive order and a standing order to provide COVID vaccines. As directed by Governor Tony Evers’ Executive Order #275, the Wisconsin Department of Health Services (DHS) has reviewed the scientific evidence surrounding the COVID-19 vaccine. Based on this review, DHS continues to recommend the COVID-19 vaccine for Wisconsinites six months and older and issued a statewide standing medical order that allows most Wisconsinites who want the vaccine to get it at pharmacies across the state without a prescription.
Services for Children and Youth
Massachusetts expanded community-based behavioral health services for children and youth. The Healey-Driscoll administration announced that 36 community service agencies have been selected across the state to provide home- and community-based services for children who are MassHealth members–nearly half of all children in Massachusetts–with behavioral, emotional and mental health needs.
States React to Federal Policy
California issued patient protections to protect immigrants from ICE. Governor Gavin Newsom signed protections into law that limit federal enforcement officers’, including Immigration and Customs Enforcement (ICE), ability to enter emergency rooms and other non-public areas in a hospital without a judicial warrant or court order, and clarifies that immigration information collected by a healthcare provider is protected as medical information. The law also limits ICE from entering classrooms or hiding their identities.
California Medicaid is notifying members of changes to the program by H.R.1. The Department of Health Care Services (DHCS) updated its online resource that provides members with information about upcoming changes to the Medi-Cal program to include the direct impacts to members from H.R.1. DHCS will continue to share updates as new information becomes available to help members and stakeholders stay informed.
New Mexico will hold a special legislative session in response to H.R.1. Governor Michelle Lujan Grisham announced that state lawmakers will convene on October 1 for a special legislative session to tackle federal cuts to Medicaid and other services, among other issues. Lawmakers plan to address funding for the Rural Health Care Delivery Fund, making health insurance premiums more affordable in the Marketplace and for those losing Medicaid, and resources for the Health Care Authority as it prepares for Medicaid enrollment changes.
New York is preserving access to health coverage following eligibility changes enacted by H.R.1. The New York State Department of Health announced that the state is taking action to preserve access to healthcare following cuts in federal funding from H.R.1 which eliminates $7.5 billion in annual funding for the Essential Plan, jeopardizing coverage for nearly 1.7 million New Yorkers enrolled in the program. A 30-day public comment period is open on the state’s proposed plan to end the state’s 1332 State Innovation Waiver and return to a Basic Health Program. This action would allow an estimated 1.3 million New Yorkers to remain enrolled in the program and mitigate revenue losses to the healthcare delivery system.
Waiver and State Plan Amendments, Requests and Approvals
Georgia received approval to amend its waiver to amend work reporting requirements. CMS approved a temporary extension and amendment of the “Georgia Pathways to Coverage” section 1115 demonstration. This approval allows the state to broaden the allowable qualifying activities under the demonstration, as well as to decrease the frequency of required enrollee reporting from monthly to annually. Per the state’s request, this amendment does not continue the state’s prior authorities to require premium payments, tobacco surcharges, or modified copayments for demonstration enrollees, none of which the state has implemented to date. This demonstration is effective through December 31, 2026.
Montana submitted a waiver to implement work reporting requirements. The state submitted a request for a new five-year 1115 waiver demonstration to require working-age, able-bodied adults enrolled in Medicaid to pay premiums and either work, pursue job training or education, or engage in community service activities. The federal public comment period will be open from September 18, 2025 through October 18, 2025.