States of Innovation: December 2025

Multiple states took steps in December to protect vaccine access in light of revisions to federal recommendations. The West Coast Health Alliance and the Northeast Public Health Collaborative respectively announced support for the vaccination of all newborns against Hepatitis B within 24 hours of birth. Individual states also took action, with Illinois empowering its Department of Health to offer vaccine guidelines, while Michigan advised parents to follow vaccine guidelines from the American Academy of Pediatrics.

Rural health was again top of mind for states in December as states waited for the announcement of Rural Health Transformation Program (RHTP) awards by the Centers for Medicare & Medicaid Services (CMS) on December 29, 2025. In addition to its announcement that all 50 states will receive awards, CMS published the State Project Abstracts submitted in each state’s application and established the Office of Rural Health Transformation. State Health and Value Strategies (SHVS) continued to update our expert perspective featuring an interactive map identifying states that have formally announced their submission and/or publicly released their application materials; the map includes links to the publicly-available material. Going forward, SHVS will monitor implementation activity. To prepare for the announcement of awards, Alabama created a rural health transformation advisory group and Nebraska said it was seeking an administrator to oversee implementation of RHTP in the state.

States also took significant steps to strengthen mental and behavioral health in December. Arizona published reports on opioid treatment in the state, while California announced a partnership with the Trevor Project to train crisis response staff to better support LGBTQ youth. New York enacted legislation to support the mental wellness of law enforcement while protecting their privacy and Washington released resources to support prescribers of medication to treat opioid use disorder.

Other state action in December included initiatives related to: accessibility; affordability and efforts to address cost; aging and long-term care; coverage for non-citizen populations; healthcare and state budgets; maternal and infant health; medical debt; public health; reproductive and women’s health; services for children and youth; services for individuals with disabilities; state reactions to federal policy; supporting the healthcare workforce; and waiver and state plan amendments, requests, and approvals. 

Accessibility

New York is requiring hospitals to implement language assistance programs. Governor Kathy Hochul signed legislation to require general hospitals across the state to develop a language assistance program. The legislation requires every hospital’s language assistance program to include policies and procedures that ensure timely identification and ongoing access for patients in need of language assistance services, ongoing education and training for hospital staff, and the provision of skilled interpreters and other staff skilled in communication with vision and/or hearing-impaired individuals.

Affordability and Efforts to Address Cost

Colorado granted enforcement authority over federal Transparency in Coverage requirements. The Division of Insurance (DOI) announced that it was granted enforcement authority over federal Transparency in Coverage (TiC) requirements by the Center for Consumer Information and Insurance Oversight. The move comes after Governor Jared Polis and Commissioner Mike Conway announced that Colorado became the first state in the country to collect state-specific federal TiC data in August. In being granted enforcement authority, the federal government is allowing Colorado DOI to monitor whether carriers are meeting state and federal TiC data rules and to issue penalties, fines, and other enforcement actions on carriers who are not compliant.

New Jersey is capping out-of-pocket costs for certain prescriptions. The New Jersey Department of Banking and Insurance has adopted final rules outlining requirements for state-regulated insurers to cap certain out-of-pocket costs on critical prescription medications. Governor Phil Murphy previously signed legislation to cap out-of-pocket costs for asthma inhalers and epinephrine auto-injector devices in addition to capping consumer costs for insulin.

New York has a new law prohibiting insurers imposing cost-sharing for additional lung cancer screening. Governor Hochul signed into law legislation which requires health insurance policies to provide coverage for follow-up screening or diagnostic services for lung cancer, and prevents insurance policies from imposing cost-sharing for those services.

Aging and Long-Term Care

Virginia has increased oversight of nursing homes. Governor Glenn Youngkin highlighted progress made in implementing executive order 52, “Strengthening Oversight of Virginia’s Nursing Homes,” signed in August 2025. Through this executive order, Governor Youngkin directed the Virginia Department of Health, through its Office of Licensure and Certification, to make significant advances toward increasing workforce capacity, strengthening nursing home oversight, modernizing operations, and enhancing transparency. 

Coverage for Non-Citizen Populations

Illinois has a new law to protect the privacy of immigrants’ health information. Governor JB Pritzker signed HB 1312 to enshrine protections for immigrant families, including ensuring privacy at hospitals. HB 1312 includes the creation of the Health Care Sanctity & Privacy Law, preventing the unlawful release of protected health information and requires all general acute care hospitals to implement a policy regarding interactions with law enforcement agents by January 1, 2026, and all other hospitals by March 1, 2026.

Healthcare and State Budgets

North Carolina restored Medicaid reimbursement rates. Governor Josh Stein directed the North Carolina Department of Health and Human Services to restore Medicaid reimbursement rates to September 30, 2025, levels. The Legislature’s failure to fully fund Medicaid forced cuts to the program in October, and the months-long budget stalemate between the legislative chambers has resulted in a wave of litigation against the state. Recent court orders made it untenable to continue with planned rate reductions, the announcement noted.

Maternal and Infant Health

New Jersey took steps to bolster the doula workforce. First Lady Tammy Murphy announced cross-government efforts to further bolster New Jersey’s doula workforce. This includes recent steps–such as the NJ Doula Assistant Tool and the State Rubric Assessment Tool–to eliminate barriers to entry and enable more doulas to participate in Medicaid.

Medical Debt

Connecticut eliminated medical debt for an additional 40,000 residents. Governor Ned Lamont announced that $63 million in medical debt will be eliminated for an additional 40,000 Connecticut residents under the third round of the state’s medical debt erasure initiative. In total, nearly 160,000 Connecticut residents have had $198 million in medical debt eliminated since the initiative began in December 2024. SHVS has updated our expert perspective tracking state medical debt cancellation initiatives.

Delaware eliminated $19 million in medical debt. Governor Matt Meyer announced nearly $19 million in medical debt has been eliminated for more than 18,000 Delawareans under the first round of the state’s medical debt relief program. The effort is supported by a $500,000 investment included in the fiscal year 2026 budget to eliminate up to $50 million.

Mental and Behavioral Health

Arizona published reports on opioid treatment in the state. The Arizona Health Care Cost Containment System has posted its 2025 Opioid Treatment Program (OTPs) reports online and is inviting the public to review and share feedback. These reports, submitted by registered OPTs across Arizona, provide insight into how the programs are supporting individuals living with opioid use disorder.

California is partnering with The Trevor Project to support crisis counseling for LGBTQ youth. Governor Gavin Newsom announced the state’s partnership with The Trevor Project to further improve training for California’s 988 Suicide & Crisis Lifeline counselors to better support LGBTQ youth. More than 1,000 crisis counselors will be offered the new training through March 2026. This effort is part of a statewide commitment Governor Newsom announced earlier this year to support LGBTQ youth, who remain disproportionately impacted by suicide risk and mental health challenges.

Illinois added public libraries as locations permitted to maintain a supply of and administer Naloxone.  The Illinois Department of Public Health has issued an updated standing order which adds Illinois public libraries to the list of locations that are permitted to keep a supply of opioid overdose reversal agents on hand, and to allow trained staff to administer them in the event of a suspected overdose on their premises. The revised standing order will make it easier for libraries to comply with new provisions of the Illinois Local Library Act which will take effect on January 1, 2026.

Michigan is investing $37.5 million in housing for individuals in recovery from SUD. The Michigan Department of Health and Human Services (MDHHS) announced a plan to invest $37.5 million into stable housing to help Michigan residents recover from substance-use disorder (SUD). A recent analysis by MDHHS found that more than 7,500 discharges from publicly funded SUD treatment annually resulted in people leaving treatment without stable housing. To address this gap, the department has set a goal to create 3,467 new recovery housing beds by 2028, an increase of 40%.

New York has a new law to support the mental wellness of law enforcement while protecting their privacy. Governor Hochul signed legislation to establish confidentiality requirements for communications made by law enforcement during peer-to-peer counseling sessions. Amid a rise in death by suicide and post-traumatic stress disorder rates among police officers, this legislation seeks to reduce stigma and create formal pathways for first responder mental wellness while ensuring communications are protected and disclosure standards are established.

Washington released new resources to support providers who prescribe OUD medication. The Washington State Health Care Authority (HCA) and Department of Health (DOH) released a new resource library to help healthcare providers and emergency medical services personnel build knowledge and confidence to prescribe and administer medications for opioid-use disorder. HCA and DOH also launched an awareness campaign to connect providers to training, clinical support, and patient education materials.

Protecting Vaccine Access

Illinois empowered its Department of Health to offer vaccine guidelines. Governor Pritzker signed HB 767 to expand and codify executive order 2025-04, which empowers the Illinois Department of Public Health (IDPH) to offer transparent, science-based vaccine guidelines through its expert Immunization Advisory Committee (IAC), while also expanding vaccine access. IDPH will create and publish vaccine guidelines for Illinoisans based on experts from the IAC and state-regulated issuers are required to cover vaccines based on IDPH recommendations.

Michigan is directing parents to follow guidance of the American Academy of Pediatrics regarding vaccine schedule. Chief Medical Executive Dr. Natasha Bagdasarian has issued a standing recommendation regarding children’s vaccines, advising healthcare providers and families to follow the child and adolescent immunization schedule produced by the American Academy of Pediatrics or the American Academy of Family Physicians.

New Jersey expects insurance carriers to cover childhood vaccines recommended by the state. The New Jersey Department of Banking and Insurance issued guidance advising that it expects carriers to provide coverage for childhood immunizations recommended by the New Jersey Department of Health, including for the hepatitis B vaccination series, in accordance with state law and without cost-sharing or the imposition of additional barriers. Also, acting Health Commissioner Jeff Brown signed an executive directive protecting the birth dose of the hepatitis B vaccine.

California, Hawai’i, Oregon and Washington announced continued support for hepatitis B for newborns. The West Coast Health Alliance announced that it strongly supports that hepatitis B vaccination continue to be routinely offered to all newborns within 24 hours of delivery.

California, Colorado, Delaware, Hawai’i, Illinois, Massachusetts, Maryland, New Jersey, North Carolina and Rhode Island denounce ACIP recommendation on hepatitis B vaccination. Governors of the 10 states that make up the Governors Public Health Alliance reaffirmed their commitment to relying on strong, science-driven vaccination guidance to protect public health in their states and ensure families receive clear, evidence-based information. In recent months, governors have raised concerns about federal actions that could introduce confusion for parents, clinicians, and schools, and last week submitted a formal public comment elevating those concerns ahead of the CDC’s Advisory Committee on Immunization Practices (ACIP) meeting.

Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Pennsylvania and Rhode Island will continue to recommend hepatitis B for all newborns. The Northeast Public Health Collaborative (an alliance of public health agencies from eight states and the city of New York) announced that it continues to recommend that all newborns receive a hepatitis B vaccine birth dose within 24 hours of delivery. The Collaborate based its recommendation on a review of the relevant scientific literature and medical professional guidance related to the hepatitis B vaccine among newborns.

Public Health

California launched the Public Health Network Innovation Exchange. Governor Newsom announced the launch of the Public Health Network Innovation Exchange (PHNIX), an initiative to modernize public health infrastructure and maintain trust in science-driven decision-making. The state is engaging some of the nation’s most respected public health voices to consult on this initiative. PHNX will serve as a hub for advancing modern tools, best-in-class science, and coordinated responses to emerging health threats.

Illinois legalized medical aid in dying for terminally ill patients. Governor Pritzker signed the Medical Aid in Dying bill (SB 1950), a law that will provide qualified terminally ill patients with the option to seek medication to peacefully end their lives on their own terms in consultation with physicians. The law is effective as of September 2026, which affords participating providers and the Illinois Department of Public Health lead time to implement stringent processes and protections as outlined in the law.

New York will make medical aid in dying available to people with less than six months to live. Governor Kathy Hochul announced an agreement with the Legislature to make medical aid in dying available to terminally ill New Yorkers with less than six months to live. The bill, with the agreed-upon amendments, will be passed and signed in January, and the law will go into effect six months later.

Wisconsin is allocating $159 million to address lead in drinking water. Governor Tony Evers and the Wisconsin Department of Natural Resources announced more than $159 million has been allocated for financial assistance through the Lead Service Line Replacement Program to 29 municipalities across the state to ensure Wisconsinites have access to clean, safe drinking water that is free of lead. The funding will help municipalities replace lead service lines, with a special focus on small and disadvantaged communities.

Connecticut, Delaware, Illinois, Maryland, Michigan, New Jersey and Wisconsin asked the EPA to monitor drinking water for microplastics. A coalition of governors in seven states sent a petition to the U.S. Environmental Protection Agency (EPA) requesting nationwide monitoring of drinking water supplies for microplastics, with the goal of better understanding the occurrence of contamination in drinking water supplies. The petition requests that the EPA include microplastics in the 2027 renewal of the agency’s Unregulated Contaminant Monitoring Rule 6 (UCMR-6).

Reproductive and Women’s Health

Oregon is making over-the-counter-birth control pills available at no cost to Medicaid enrollees. The Oregon Health Authority (OHA) announced that Medicaid enrollees will now be able to get over-the-counter birth control pills, including Opill, and emergency contraception at no cost at pharmacies in the state. OHA, in collaboration with the Oregon Board of Pharmacy, made this possible through a standing order, which allows pharmacists to provide these medications to Medicaid enrollees and bill Medicaid.

Pennsylvania is investing $3 million to make period products free for students. The Department of Health is investing another $3 million to provide free period products to students in all of Pennsylvania’s school districts, career and technical centers, and brick-and-mortar charter schools. Building on last year’s investment, the Commonwealth has provided a total of $6 million to buy period products for school students.

Rural Health

Alabama created a rural health transformation advisory group. Governor Kay Ivey signed an executive order to establish the Alabama Rural Health Transformation Advisory Group. The Advisory Group will advise the governor on the progress, policy development and implementation of Alabama’s RHTP after its anticipated launch in January. SHVS continues to update our expert perspective featuring an interactive map identifying states that have formally announced their RHTP submission and/or publicly released their application materials.

Colorado hosted a webinar on the state’s RHTP application. The Department of Health Care Policy & Financing hosted a webinar on the RHTP to provide an overview of the state’s application and walk through next steps in the process.

Nebraska is hiring an administrator to oversee implementation of RHTP. The Department of Health and Human Services is seeking a Rural Health Transformation Program Procurement Administrator to lead strategic contracting initiatives, guide a team of professionals, ensure full regulatory compliance, and strengthen vendor partnerships.

Services for Children and Youth

Minnesota survey results indicate an improvement in student mental health. Governor Tim Walz highlighted improvements in student health and wellbeing, as demonstrated in the 2025 Minnesota Student Survey. Survey results indicate the reversal of a decades-long trend of declining student mental health, reflecting the impact of targeted state investments in children and families, including investments in education.

North Carolina launched a managed care plan for children and youth involved in the child welfare system. The North Carolina Department of Health and Human Services (NCDHHS)  announced the launch of the Children and Families Specialty Plan, a statewide health plan to ensure access to comprehensive physical and mental health services for Medicaid-enrolled children, youth and young adults currently and formerly served by the child welfare system. With approval from and at the direction of the North Carolina General Assembly and in partnership with Blue Cross and Blue Shield of North Carolina, the plan went live on December 1, 2025.

Services for Individuals with Disabilities

North Carolina is expanding an employment program for individuals with disabilities. NCDHHS is expanding its employment initiative, Project Spark, by launching 10 new locations across the state. The expansion will increase access to services and supports that help individuals with intellectual and developmental disabilities secure competitive integrated employment-–jobs in typical community settings where people with disabilities work alongside colleagues without disabilities, earn at least minimum wage, and receive the same benefits and opportunities as others in similar roles.

States React to Federal Policy

Connecticut looks to reserves to make up for loss of federal funding. Governor Lamont announced that his administration submitted a plan to the Connecticut General Assembly to tap into the recently created Emergency State Response Reserve in response to recent federal funding reductions. The plan includes funding for the replacement of the expiring enhanced premium tax credits, supplemental payments to federal qualified health centers, coverage of the lost federal reimbursement for services provided by Planned Parenthood of Southern New England, operational costs for the Connecticut Department of Social Services to help Medicaid and SNAP clients meet new eligibility rules and program requirements, and funding for food assistance and to keep people in their homes. Legislative leaders had 24 hours upon receipt of the plan to review and approve.

Waiver and State Plan Amendments, Requests and Approvals

Nevada wants to establish a managed care plan for children and youth involved in the child welfare system. Nevada submitted a request for an amendment to its demonstration, “Nevada’s Treatment of Opioid Use Disorders and Substance Use Disorders Transformation Project.” Nevada proposes to establish a mandatory specialty managed care delivery system through other authorities for children in the care and custody of the state, those receiving adoption subsidy assistance, and other children and youth who meet defined behavioral health clinical criteria. The amendment aims to narrow the managed care delivery system to a single managed care plan.

New Jersey received approval for a state directed payment. The New Jersey Department of Health and the New Jersey Department of Human Services announced that the federal government has approved approximately $540 million in funding to help hospitals care for uninsured residents and to improve outpatient services for Medicaid patients. This investment, planned for state fiscal year 2026, comes through the Medicaid Outpatient State-Directed Payment Program.

Florida is requesting to exempt individuals with permanent disabilities from redeterminations. The Florida Agency for Health Care Administration has submitted an amendment to the Florida Managed Medical Assistance 1115 demonstration. The proposal would exempt individuals who are permanently disabled from the 12-month Medicaid redetermination requirement to prevent disenrollment due to administrative or procedural reasons and to mitigate gaps in Medicaid coverage.

Iowa received a one-year extension of the state’s 1115 demonstration waiver. CMS approved a temporary extension and amendment of Iowa’s section 1115 demonstration, known as the “Iowa Wellness Plan” through December 31, 2026. As a part of this approval the state’s non-emergency medical transportation waiver will not be extended beyond that date, even if other parts of the demonstration are extended.

Rhode Island was approved to extend its section 1115 waiver for five years. The state received approval from CMS to extend its section 1115 demonstration entitled, “Rhode Island Comprehensive Demonstration” for an additional five years.

Supporting the Healthcare Workforce

New Jersey released a strategic plan for increasing the direct care workforce. New Jersey Human Services, in partnership with seven state agencies, announced the release of the New Jersey Direct Care Workforce Strategic Plan, a comprehensive roadmap to support, grow, and stabilize the workforce that provides essential care to older adults, individuals with disabilities, and residents with behavioral health needs.

Pennsylvania is investing in training and support for the EMS workforce. The Pennsylvania Department of Health announced Governor Shapiro’s recently signed 2025-2026 budget invests $6 million in new funding for Emergency Medical Services (EMS) to support training and educational opportunities, recruit new EMS staff, and purchase new medical equipment for ambulances.