#467 - Navigating the Future of Pediatric Healthcare Funding

Hello friends 👋

Ben sits down with Dr. Shetal Shah and AAP federal advocacy director Stephanie Glier to unpack HR1, the sweeping reconciliation bill that could cut $1.15 trillion in federal Medicaid spending over the next decade. With 40% of US births and up to 65% of NICU graduates covered by Medicaid, the stakes for neonatology are enormous. Shetal and Stephanie break down state directed payments, provider taxes, shortened retroactive coverage windows, and new work requirements, explaining how administrative friction alone could push families out of coverage. They also offer a clear playbook: connect with your AAP state chapter, share bedside stories with policymakers, and don't be more intimidated by a congressional office than by a resuscitation.

----

Articles:

AAP Advocacy page: https://www.aap.org/en/advocacy/?srsltid=AfmBOoqcnlKDsPZkpNg6z6U7OlOuBqUiuCtWHrUPmRGzfqDiQEl-vf7s

Myers CN, Beck AF. H.R. 1’s Medicaid cuts threaten children’s health. Health Affairs Forefront. January 20, 2026. Accessed August 28, 2026. https://www.healthaffairs.org/content/forefront/h-r-1-s-medicaid-cuts-threaten-children-s-health

Little J, Kohler A. How H.R. 1 cuts and changes to Medicaid played out in 2026 state legislative sessions (Part 2). Georgetown University Center for Children and Families. July 2, 2026. Accessed August 28, 2026. https://ccf.georgetown.edu/2026/07/02/how-h-r-1-cuts-and-changes-to-medicaid-played-out-in-2026-state-legislative-sessions-part-2/

Academy of Managed Care Pharmacy. Implications of H.R. 1 – the One Big Beautiful Bill Act. Academy of Managed Care Pharmacy. 2026. Accessed August 28, 2026. https://www.amcp.org/H.R.1

Park E. New CMS guidance on H.R. 1's restrictions of state directed payments. Georgetown University Center for Children and Families. February 4, 2026. Accessed August 28, 2026. https://ccf.georgetown.edu/2026/02/04/new-cms-guidance-on-h-r-1s-restrictions-of-state-directed-payments/

Mudumala A, Mohamed M, Tolbert J, Burns A. The impact of H.R. 1 on two Medicaid eligibility rules. KFF. September 22, 2025. Accessed August 28, 2026. https://www.kff.org/medicaid/the-impact-of-h-r-1-on-two-medicaid-eligibility-rules/

----

Short Bios:

Dr. Shetal Shah: Dr. Shetal Shah is a practicing neonatologist and researcher, and a Professor of Pediatrics in the Division of Neonatology at New York Medical College, the academic affiliate of Maria Fareri Children's Hospital, a member of the Westchester Medical Center Health Network (WMCHealth). His research focuses on understanding the role of the neonatal intensive care unit in providing public health measures, particularly vaccinations to parents of admitted infants. He also aims to conduct research, which through sustained advocacy, can be translated to policy.

Dr. Shah’s work on providing parents influenza and Tdap immunization in the neonatal intensive care unit has resulted in two New York State public health laws. He was the principal advocate for the 2009 Neonatal Influenza Prevention Act and the 2012 Neonatal Pertussis Prevention Act. His work on the cost-effectiveness of donor milk for high risk neonatal infants resulted in co-authorship of a legislative measure mandating New York State Medicaid provide insurance payment for this vital resource. His current work focuses on the safety of administration of live rotavirus vaccine to preterm, NICU-hospitalized infants, bedside adult pneumococcal immunization and point-of-care smoking cessation referral.

From a basic science perspective, Dr. Shah’s current work examines the anti-inflammatory properties of stem cells on lung recovery from pulmonary hemorrhage and hyperoxic injury, focusing on cytokine biology and fibrosis. He is a recipient of many honors, including the American Medical Association’s Leadership Award, the National Physician Advocate Award, the New York State L. Stanley James Award for Perinatal Medicine and the March of Dimes Excellence in Advocacy Award.

Stephanie Glier: Stephanie Glier is a Director of Federal Advocacy for the American Academy of Pediatrics where she leads federal advocacy to promote children’s health care coverage and access to care, as well as effective financing, quality, and delivery of care for children. Prior to joining the Academy, Stephanie led the Consumer-Purchaser Alliance, a coalition of consumer, employer, and labor organizations collaborating to improve the value and outcomes of the health care system. Stephanie previously worked on health care policy in the Office of the Assistant Secretary for Planning and Evaluation at HHS, the Center for Medicare and Medicaid Innovation, and The Commonwealth Fund. She holds a Bachelor of Arts in Human Biology from Stanford University and a Master of Public Health from the George Washington University.

----

The transcript of today's episode can be found below 👇

Ben Courchia, MD (00:00.362) Hello everyone, welcome back to the Incubator Podcast. We're back today for our special series on neonatal advocacy with our good friend and colleague, Dr. Shetal Shah. Shetal, welcome back to the show.

Shetal Shah (00:12.824) Thank you so much, Ben. I'm really excited to be back — this is awesome. I hope you had a great summer.

Ben Courchia, MD (00:18.068) The last time we spoke was about training. Today we're talking about advocacy and recent bills being proposed, and we're very excited to be joined by another returning guest, Stephanie Glier. Welcome back to the show.

Stephanie Glier (00:35.549) Thanks for having me back.

Ben Courchia, MD (00:37.194) Shetal, people know you're a professor of neonatology at New York Medical College, and your advocacy work is extensive. Stephanie, you've been on the podcast before — you're the director of federal advocacy at the AAP (American Academy of Pediatrics). We're very excited to talk to you today. Well, I don't know if "excited" is the right term, but we're talking about HR1 and Medicaid cuts.

I wanted to take a step back and start from the beginning so everyone has some understanding of what we're talking about. Medicaid and CHIP (Children's Health Insurance Program) are programs that provide coverage for a staggering number of children — 38 million children in the US — and serve as the financial backbone of the pediatric healthcare system, funding hospitals, preventive services, and community programs. Shetal, given that Medicaid supports the physical infrastructure that cares for all children, how will the funding cuts we're about to discuss fundamentally alter the landscape of pediatric healthcare financing?

Shetal Shah (01:41.709) Thanks for that — I think this is really important, because one of the things Stephanie and I are committed to is educating neonatologists. As neonatologists, we tend to be, for the most part, employed physicians. Because we're employed by a children's hospital or some other entity, the distance between how we're paid and where the money actually comes from becomes a little greater, and I think people don't always fully appreciate how that payment structure works.

Ben Courchia, MD (02:16.081) It's a fatal mistake of our specialty, by the way.

Shetal Shah (02:19.918) Absolutely — 100%. My sister is a private practice ENT doctor — she hates it when I talk about her — but she knows almost mentally, in her head, what diagnoses, what time, what insurance companies pay what. That's because if you're in private practice, and I'm sure a lot of our general pediatric colleagues have some idea of this too, you quickly develop, over years, this familiarity with what pays for what. In neonatology, we're sometimes really distanced from this.

But we have to remember: when we're talking about children's health insurance coverage, we begin and end, and begin and end again, with Medicaid. Up to almost half of all children, depending on when you look, are covered by either Medicaid or CHIP. But that's children in general — as neonatologists, we care specifically about neonates. Forty percent of all births in the United States right now are in the Medicaid program. So four out of every ten babies born in this country are born and covered by Medicaid. If you're a higher-risk baby — a 28-weeker, a 32-weeker, a 25-weeker — up to fifty percent of those high-risk babies are covered by Medicaid.

Now, what's interesting is that's at the time of birth. The number of kids covered by Medicaid by the time they leave the NICU is actually upwards of 65%, because in some states, you might be born to parents with private insurance, but you might max out an annual or lifetime premium within a month or two of neonatal hospitalization. But depending on state requirements, you might then qualify for Medicaid. In New York, for example, a lot of micropreemies born to police officers, nurses, even physicians, will exceed their private coverage limit but meet a disability requirement that qualifies them for Medicaid. So by the time they leave the hospital, the baby is actually covered by Medicaid.

When we talk about babies in this country and their ability to access care — not just in the unit, but all the subspecialty care they'll need after discharge, all the five, six, seven subspecialty appointments they leave with — we really begin and end with Medicaid.

Ben Courchia, MD (04:59.602) Stephanie, I mentioned the term HR1. I believe a lot of people may have heard about it in the form of the "One Big Beautiful Bill," which was in the news — this was a bill signed into law by President Trump on July 4th, and I believe it went through both chambers, though you'll clarify that for me if I'm mistaken. The idea is that this bill is a massive budgetary reconciliation package that includes a lot of the cuts to Medicaid we're going to discuss, and their potential impact on our population. Can you tell us more about what HR1 is and what it means specifically for the physicians and providers listening to this show?

Stephanie Glier (05:56.722) Definitely. Here in Washington, DC, where we talk about congressional ins and outs all the time, we often refer to things by their legislative bill number. HR1 was the reconciliation budget bill that passed and was signed into law last year, 2025, on July 4th, and now it's the law of the land. HR1 as a reference number means it was one of the top priorities of Congress — that's why it has the number one associated with it.

After President Trump's insistence, they called it the One Big Beautiful Bill Act — he'd said he wanted one big beautiful bill, not two smaller ones. That's actually fairly hard to say, so some people call it "OBBBA." Because it was so hard to say, our friends at the Centers for Medicare and Medicaid Services (CMS) have taken to calling it the Working Families Tax Cuts legislation.

It's totally fine if you have no idea what we're talking about when we use any of those labels — it's the major budget bill Congress passed in 2025 that enacted most of the President's domestic policy agenda. That was primarily about tax cuts, not really about Medicaid at all — this was about making sure the Trump tax cuts from his first administration continued into his second term. Medicaid only came into play because they needed to find a way to pay for those tax cuts, and there's a lot of money in healthcare spending programs. To fund the tax cuts and some immigration priorities, Congress needed to find about a trillion dollars in pay-fors, and they decided to do that by cutting federal spending in the Medicaid program overall.

So what we're looking at now is the implementation of this bill. As passed, it has three big buckets of cuts to the Medicaid program specifically, all taking effect over about ten years — but as I said, we're expecting it to cut about a trillion dollars of federal spending out of the program.

Ben Courchia, MD (08:05.81) We're talking about $1.15 trillion in federal healthcare spending cuts over the next decade, and these provisions will increase the number of uninsured individuals, according to the Congressional Budget Office, by up to 10 million by 2034. Other government estimates suggest as many as 17 million Americans could lose coverage. These numbers are staggering — it's kind of difficult to even grasp what that means when the numbers get this big. From your perspective, how will a federal funding reduction of this magnitude materialize on the ground level, specifically for pediatric care and coverage?

Stephanie Glier (08:57.521) That's a great question. One of the things that was true during the debate about this law was whether it was actually going to affect most Medicaid beneficiaries. A lot of folks think of Medicaid as a program that covers a lot of births, a lot of kids, a lot of disabled individuals, and a lot of elderly folks in nursing homes — nobody wanted to cut the services those populations rely on. Unfortunately, because of the way these cuts take place, they're so foundational to how the program is financed that there's no way to avoid hurting those populations as a whole.

Let me back up for a quick reminder of how the Medicaid program works, since I know it's not always top of mind for a practicing neonatologist the way it is for a Medicaid wonk like me. Medicaid is a state-federal partnership. The federal government sets broad parameters for who and what the Medicaid program covers, and states take that rough sketch and flesh it out — deciding which populations to cover, which specific services, how to pay for it, which hospitals and providers to include. In turn, the federal government picks up somewhere between half and three-quarters of the cost of the program, and the states cover the rest.

Every state's match is different — Wyoming, for instance, covers half the cost of its Medicaid program: for every dollar Wyoming spends on Medicaid, the federal government also pays a dollar. For states with lower per-capita income, the federal government picks up a higher share — in Mississippi right now, the federal government covers 77% of the cost, so for every dollar Mississippi spends on Medicaid, the federal government spends about four dollars in turn.

So states are able to draw down a lot of federal funding to help support the program as they run it. These cuts happen in two major ways: one is changes to eligibility — who can be enrolled — and the other, much harder to wrap our heads around, is changes to the ways states can raise their share of Medicaid costs. Going back to Wyoming: if Wyoming has to pay half of all Medicaid spending, it has to come up with that in its state budget — through general revenues, targeted taxes, other parts of the general fund. States have to figure that out on their own, deciding with the state legislature and governor how much they can spend on Medicaid in any given year.

The two major changes HR1 made are to something called state directed payments, and something called provider taxes. Both are financing mechanisms states have used to target how Medicaid spending happens within the state — prioritizing certain types of care, especially when it's harder for patients to access that care, and making sure they can pay enough to keep hospitals and physicians in the Medicaid network. Right now we're looking at major changes constraining how much money states can raise for their share of Medicaid spending, which will make it harder for them to draw down those federal dollars.

Ben Courchia, MD (12:31.583) Shetal, you were going to say something?

Shetal Shah (12:34.819) I was going to say, let's make this concrete — we're neonatologists, we like numbers. I'll explain it the way I've explained it to my own fellows. Ben, you're a neonatologist, a provider, you take care of Medicaid patients. Stephanie is the federal government, and I'm New York State — or Florida, since Ben's in Florida.

Ben Courchia, MD (13:00.499) I lived in New York — let's bring me back.

Shetal Shah (13:04.874) And Queens! So: I'll charge Ben, say, $200 to be a Medicaid provider — I'm taxing him for the privilege of caring for Medicaid patients. Ben's a little upset about that, but bear with me. I then go to the federal government and say, "Hey Stephanie, I've raised $200 for my Medicaid program — you need to match that." That's the state-federal partnership. Stephanie now gives the state $200. That's $400 in the state coffers — $200 raised from you, $200 from the federal government. The state then gives you $350 of it back in exchange for the clinical care you provide, and keeps $50 for other use elsewhere in the Medicaid system.

So that gives you an idea of one way states can raise money. Now, one thing we have to talk about, since many of us work in children's hospitals, is that children's hospitals really benefit from the revenue raised by these provider taxes. If you cut provider taxes, it's almost impossible not to financially injure some children's hospitals.

The Children's Hospital Association actually surveyed 64 hospitals — 56 of them benefited from provider taxes. Those 56 hospitals paid about $1.8 billion in provider taxes, but received about $4.5 billion back in Medicaid payments. So if you undermine the ability to raise that $1.8 billion, you undermine the ability to take advantage of that match and redistribute that money back to children's hospitals. It's a bit of financial sleight of hand, but if you follow the money, you quickly understand children's hospitals are really in the line of fire when we talk about changing provider taxes.

We're particularly vulnerable because we're less than 5% of all hospitals but take care of basically 50% of all children. The drawdown in Medicaid spending Stephanie mentioned — the $1.15 trillion — is going to reduce Medicaid spending on children by three-fourths. Seventy-five percent of child Medicaid enrollee spending is currently at risk. That's why there needs to be a bit of an alarm for all of us, because this is going to impact neonatology differently than the entire children's hospital system, but it's certainly going to impact all of us.

Ben Courchia, MD (16:11.658) Stephanie, going back to what Shetal just mentioned — you mentioned state directed payments. We'll have a list of links on the episode webpage for people who want to read further, but I'd love for our listeners to understand the terminology, because it's difficult to follow if you're not familiar. Can you explain what we mean by state directed payments, and what it means that these are going to be capped by this bill?

Stephanie Glier (16:45.349) Right before we get to state directed payments, I want to add one more caveat to the provider tax conversation, because the terminology here is confusing overall. As Shetal said, some provider taxes are on hospitals — some hospitals do pay provider taxes. But when we say "provider taxes," sometimes we also mean insurance plans — managed care organizations in the Medicaid space are also "providers" in this context. So sometimes it's not directly at the facility or clinician level — it's at the health insurance system level. If you have a Centene plan, a UnitedHealthcare plan, or a Blue Cross plan participating in Medicaid, they might also pay into the system in a similar way, enabling a differential payment to flow through.

Ben Courchia, MD (17:30.496) Which overall contributes very nicely to the workforce feeling underfunded, underpaid, and undervalued.

Stephanie Glier (17:38.716) Exactly right. So state directed payments are a way for a state to tell the managed care plans operating in their state that they need to send more money directly to either a specific type of service or a specific provider. For children's hospitals, this is essential, because most of the time Medicaid payment is dramatically under the actual cost of clinical care. The base Medicaid payment — whether offered by the state in a fee-for-service system or by managed care plans under their contracting arrangements — often doesn't cover the full cost of care children's hospitals provide. I'm sure that's especially true in the NICU, though I haven't done a close enough analysis of NICU-specific codes to say exactly what that looks like.

Right now, state directed payments cover about 38% of total Medicaid funding for children's hospitals — that's about 13% of overall children's hospital operating resources. That's a huge amount of funding. In addition to the base Medicaid payment, whenever a hospital bills the state or the managed care organization (MCO) for a particular service, there's additional funding that has to come through from the state to true them up, to make sure they can keep operating at pace.

Let me stop there and see if Shetal has anything to add.

Shetal Shah (19:07.499) If you spend a little time in the dark corners of the internet — usually between when the midnight blood gases come back and the four AM ones haven't come back yet — you can actually see how states have been using some of their state directed payment funds and how that's impacted neonatal care. I don't know, Ben, what do they call fans of the Incubator Podcast? Like Potterheads, Swifties — is there a term?

Ben Courchia, MD (19:35.08) No, there's no term — I'm coming up with it on the fly since you're putting me on the spot.

Shetal Shah (19:37.985) Okay, well, all the "Incubator fans" in Louisiana should know that state directed payments are actually used to help support level 2 units in rural areas of Louisiana — to increase those payments, because otherwise those rural hospitals with level 2 units would close, and everyone in the state would presumably have to travel to New Orleans or another major city to get care. Now you're talking about traveling hundreds of miles.

In Texas, they use something called a uniform rate increase — one of the mechanisms states can use through state directed payments — to increase payment for regional and transport services across long distances, presumably for the same reason: babies born in rural hospitals who need to be transported long distances to tertiary care centers. That obviously costs a lot of money — you have a specialized transport team tied up for several hours. Rhode Island also increases both their neonatal and PICU (Pediatric Intensive Care Unit) payments using state directed payments. In New York, some of our maternity value-based care and quality care initiatives are funded through state directed payments too.

This matters because we spend a lot of time in the NICU talking about quality care. The NICU is an expensive place, a lot of payments come from state government, and the state wants to know they're getting high-value care. We have a federal commitment to that through state quality collaboratives, where we all partner to do things like reduce central line-associated bloodstream infections, improve extrauterine growth, reduce extrauterine growth restriction, increase access to donor milk — and a lot of states end up paying level 3 and level 4 units bonus payments for that high-quality care. All of that is potentially threatened if state directed payments change, because the formula used to calculate how much the state gets, and can then redistribute, is at risk.

Ben Courchia, MD (22:07.723) We've alluded to this during several of your answers, but this bill will also impact reimbursement levels Medicaid provides for specific services. Can you talk about that? You're both nodding — Stephanie, go ahead.

Stephanie Glier (22:32.049) There are two ways we're worried about payment rates. First, as Shetal just said, several specific payments are tied to state directed payments, and CMS has just proposed several changes to how states can use them — changes that will make it hard to do value-based payment, pay for quality as Shetal described, and hard to do things like the uniform rate increases Texas has used for transport medicine. So we're worried about what happens to services that have relied on state directed payments to keep operating.

The second, more insidious and harder-to-understand piece is the state budget overall. As states grapple with the major budget gap coming from these funding changes, they have to figure out how to make it up — the care needs don't go away, the money has just disappeared. States have to put up money to draw down the federal match, and states also have to operate with balanced budgets, so they can't run a deficit. So states are facing a sudden budget gap in their Medicaid program, and they can either shrink the program to match a smaller budget — cutting eligibility, benefits, or payment rates — or find money elsewhere, which means raising taxes or cutting something else the state funds, like infrastructure or education. Those are terrible choices, and the easiest one for most states is to chip away at covered benefits.

That's especially true for adults, but also true for kids with complex medical needs who rely on higher-cost, wraparound services — particularly kids with complex medical needs and children with disabilities. So if you're discharging a NICU baby who needs those seven or eight specialty referrals, some of those are going to be a lot harder to find, requiring more individual medical necessity determinations, more prior authorizations, more peer consults before you can even get coverage confirmed. We're also worried about payment rates — it's an easy place for states to say, "we're doing an across-the-board 3% cut to all hospitals, 3% to all physician payment rates," and then everyone has to scramble to make up the difference. Both of these will be really challenging to track over time.

Ben Courchia, MD (25:09.698) We'll talk about eligibility in a minute — I'd like to devote the last ten or fifteen minutes of the show to it, because it's a big deal too. Shetal, go ahead.

Shetal Shah (25:20.601) I was going to say — if you spend time, like I do, roaming your state capital (everyone should be familiar with the layout of their state capital, particularly where the Dunkin' Donuts is), I was walking around with one of the Senate finance staff members, and he said something I've never forgotten, because it really highlights the difference between how we, as neonatologists, see the world, and how they see the world.

I looked at this and said, "Who would cut funding for babies? That's insane." He looked at me — not meanly, he was educating me — and said: "Look, from a Senate standpoint, it's a beautiful thing, because I look at a pediatric budget and see a huge amount of money spent on a very small percentage of the population, and that percentage tends to be economically disenfranchised. They're not going to vote adversely, the children themselves aren't going to vote, and I can save a lot of money, because unlike cutting an outpatient field, where a general pediatrician or internist might say, 'the payment's gotten too low, we're no longer taking Medicaid' — when you have upwards of 60% of births, by the time of discharge, or 50% of high-risk births, covered by Medicaid, no NICU is going to say, 'we no longer take Medicaid.' It's just too big an insurer for us."

So if you're a Senate finance person looking at neonatology, you're thinking: I can save a lot of money, I can hurt a relatively small number of people financially, and I'm not going to lose any services — no one's going to say "there's no NICU to take me." I looked at him and thought, "give me my donut back" — are you kidding me? None of us see the world that way. But it's instructive, because if you're looking at a state budget trying to save reimbursement dollars, you never would have thought neonatology would be this attractive a target. It's another reason we all need to be at least somewhat familiar with these changes and speak up about them — because, as Stephanie mentioned, this is a ten-year rollout period, which gives us a lot of time to push back.

Ben Courchia, MD (28:24.91) I don't know what to say — it's very pragmatic, for sure, but my God. Okay, we have about 10-15 minutes left, and I wanted to talk about the eligibility changes HR1 is bringing. First, there's a KFF (Kaiser Family Foundation) report you shared with me about a 10-year moratorium on Medicaid eligibility and enrollment simplification rules, which alone should cut about $122 billion in federal spending. What does that mean?

Stephanie Glier (29:05.595) You've nailed a super niche issue here. During the Biden administration, CMS published a rule directing states to update their eligibility and enrollment systems for Medicaid and CHIP — including technology updates, since some states were running systems built on 1970s platforms with maybe one remaining coder who hadn't retired. It also made changes protective for beneficiaries trying to enroll or renew coverage — ensuring fair notice, fair hearings, beneficiary-friendly timelines, and requiring states to make real effort to contact people before disenrolling or denying them.

One piece of HR1 was that Congress rescinded that rule entirely, and instituted a 10-year block on CMS reinstating that rule, or anything resembling it, regardless of any change in administration or presidential priorities. Rolling back that rule is a savings mechanism, because it means beneficiaries face a lot more paperwork and hoops to jump through, and fewer people will end up covered as a result. All the savings come from fewer people being covered.

Ben Courchia, MD (30:45.335) Shetal, following up on that — it looks like HR1 requires Medicaid expansion eligibility to be evaluated at least every six months, which, reading these articles, seems designed to introduce enough administrative friction to increase churn.

Shetal Shah (31:05.686) Right, that's exactly the goal — create as much administrative hurdle as possible so people drop out and lose insurance. The six-month thing is crazy to me — I park in the hospital parking lot and never renew my permit until it doesn't scan, and only then do I realize I need to go renew it. It's the exact same thing here: people aren't going to know they've lost coverage until they get sick and need it, which pushes a lot of people away from preventive care.

Now, newborns — correct me if I'm wrong, Stephanie — get a full year before they have to renew. So a lot of our NICU patients are somewhat protected for that first year. But as we all know, these kids have ongoing health needs for at least the first two, three, four years of life — not even counting developmental needs that last through school age and beyond. So there will definitely be an impact on our kids beyond the first year, because they'll end up dropping out of coverage unless their parents actively renew at 18 months, then again six months later, and again six months after that.

Think about how much disruption that causes — what's called "churn," where people cycle in and out of coverage based on whether they've re-proven eligibility. That's bad for children, but the same is true for adults, and there's a strong association between parents being covered and children being covered. If parents are covered by Medicaid, their children are three times more likely to be covered — that's from a study by [name uncertain, phonetically similar to "Venkataramani"], and other researchers using somewhat different methodologies have found similar odds ratios, around 3 to 3.1.

There are also increased odds that Medicaid-covered children receive immunizations, lead screening, anemia screening, developmental screening — things we normally associate with preventive care — when their parents are covered. So if we create a barrier to parental coverage, like six-month eligibility redeterminations, we're indirectly harming children, or at least there's a strong association that we will. And by instituting six-month eligibility, we're directly creating an administrative burden for all our patients with chronic health needs beyond the first year of life.

Ben Courchia, MD (34:06.19) Another burden I read about is a requirement to prove compliance for three full months before you can even apply based on eligibility. Can you explain that? It feels like HR1 is being weaponized to create stricter and stricter barriers.

Stephanie Glier (34:40.657) Yes — one of the splashiest changes to Medicaid eligibility from HR1 is the introduction, for the first time ever, of what's called a community engagement requirement — most people think of it as a work requirement. Adults in the Medicaid expansion population now have to prove they're working at least 80 hours a month, or engaged in community service or educational activities.

Ben Courchia, MD (35:07.418) When you say "expansion," that means people who are just joining under expanded eligibility — is that right?

Stephanie Glier (35:11.571) Right. The Medicaid expansion population was part of the Affordable Care Act. Every state has an income threshold below which an adult without children can qualify for Medicaid — very low, based on the federal poverty level (FPL). If you're a low-income parent, you can also qualify, depending on your children's ages and your state. There's a big gap between that low threshold and where people qualify for subsidies on the health insurance exchanges. The Medicaid expansion allowed adults — regardless of parental or disability status — to enroll in Medicaid up to 133% of the FPL. That new population of adults, who didn't qualify as extremely low income or for exchange subsidies, is the Medicaid expansion population.

Ben Courchia, MD (36:22.384) Thank you for explaining that. So, back to that three-month lookback.

Stephanie Glier (36:25.939) Right — this population now has to meet a criterion they've never had to meet before in Medicaid. A couple of states have tried work requirements for Medicaid eligibility in the past using waivers, and the only state that actually implemented one was Arkansas. In just the first six months of that program, thousands of people lost coverage because they couldn't meet the work reporting requirements — even though most of them actually were working; they just couldn't navigate the paperwork to prove it, and got dropped from the program. That's an ominous preview of what we expect now, since every state with a Medicaid expansion population — which is almost all states — now has to implement a work requirement.

The mechanics are complicated: you have to prove you're working through pay stubs, a letter documenting community service, or proof of educational enrollment at the right level — or you have to meet an exemption. Certain populations are exempt from the work requirement — former foster youth up to age 26, parents of children under 14, and people with medical frailty are all supposed to be exempted. So there are still ways to get into the program without proving employment, but the paperwork remains really complicated. You mentioned the three-month compliance window — the exact duration depends on what each state decides, which makes it even harder to summarize, since every state is operationalizing this a little differently.

Ben Courchia, MD (38:15.887) North Carolina, Indiana, and Idaho are the states I read about with that three-month requirement. We're nearing the end of our conversation, and I think we should spend some time on what we do now. This bill was clearly one the government was determined to push through at all costs — you mentioned it's HR1 because it was the top priority. So are we just supposed to sit and wait for the tornado to hit us, or is there anything we can do to mitigate these effects? Shetal, I'll let you go first.

Shetal Shah (39:03.959) Ben, I think the tornado has already hit — it's just a question of how long it stays. Last year, a lot of state budgets and legislative sessions begin in the first half of the year, but states are already thinking about budgets in the fall before that. We spent a lot of time in New York, and I know a lot of other advocates did in their states, already talking about where these cuts were going to come from. Because if you enact a law in July 2025 that begins taking effect the following year, everyone has to start planning: are you going to raise taxes to cover your state's Medicaid share? What gets taxed, what doesn't? Do you curtail eligibility or payment? All of that was being discussed before the legislative session even began.

I always tell people this is the fog that hangs over everything else in advocacy. It's very hard to advocate for new priorities when there's concern a state could lose up to a third of its federal spending over a ten-year span — it makes people very gun-shy about increasing payment levels, and makes state legislators very shy about instituting new programs. So even if it hasn't hit the ground directly yet, it's already influencing how states are apportioning their budgets.

Ben Courchia, MD (40:52.965) Stephanie, how is the AAP approaching what Shetal just described, in terms of continuing to support care for children with all of this being enacted?

Stephanie Glier (41:11.333) The AAP is taking a multi-track approach. We're doing a lot of work at the federal level with Congress — a lot of education to make sure congressional offices understand what this actually looks like on the ground. This Congress has until December, and a new Congress comes in in January, so there's ongoing education now, and we'll keep working to find specific mitigation opportunities in the next Congress as well.

We're also working closely with CMS — sometimes through public comments and letters, and in cases where they're receptive, providing more specific feedback on how to make sure these policies don't hurt kids. And we're working with our state chapters in every state — one of the best things a neonatologist can do is connect with their AAP state chapter and find out how to support the work they're doing with the state capitol, state legislature, and other policymakers to understand and mitigate harms at the state level. Every state is taking a different approach, and even if you don't have time to walk the halls and find the Dunkin' Donuts in your state capital like Shetal has, sharing stories from your own practice, your own NICU or department, with your state chapter is incredibly helpful. Those stories reinforce what the data tells us about how the pediatric delivery system is being impacted, which is always useful to share with policymakers.

The other thing we're doing, as always, is running a get-out-the-vote campaign, Vote Kids — both for pediatricians and neonatologists, and for the public. One of the most important things you can do to support child health at every level is to vote — federal, state, local — to make sure elected officials keep kids front and center in their policy thinking.

Ben Courchia, MD (43:23.493) You mentioned discussing this with a potential new Congress coming in January — in an ideal scenario, what's the goal you'd love to see achieved through this work?

Stephanie Glier (43:39.316) Great question. I'm trying hard not to put the cart before the horse thinking about the next Congress. We're expecting a pretty narrow margin out of the midterm elections — we don't yet know if the House or Senate are likely to flip control. So we're working to make sure we have good child health champions in both chambers, regardless of party.

Ben Courchia, MD (44:05.808) What I was really asking is whether there's a way this could be undone — I think some listeners may be wondering if that's the goal here.

Stephanie Glier (44:13.937) There definitely are conversations underway — bipartisan conversations about rolling back some specific policies. For example, Senator Josh Hawley of Missouri has talked about how worried he is about what this bill means for community hospitals, particularly rural hospitals, and has discussed wanting to roll back pieces of it. Honestly, I think it's unlikely the president would sign a bill that rolled these back wholesale — so there would have to be much more targeted changes while President Trump is still in office.

Shetal Shah (45:02.137) I think there's a role for chipping away at specific pieces. We talked about this huge piece of legislation and all its different components — Stephanie's completely right that a president who wanted this enacted won't allow it to be fully undone. But if we can target specific aspects that disproportionately impact children and babies, and be a voice for just that one clause or measure, there's an opportunity to either get it removed entirely or at least mitigate the damage — sometimes at the state level.

Stephanie's heard me complain about this many times, but I have a pet peeve clause in HR1: the retroactive coverage period. There's a clause that reduces the retroactive coverage period — the period before you're actually enrolled in Medicaid for which Medicaid will still pay. For example, if the retroactive coverage period is 60 days, and you're hospitalized and get Medicaid coverage 30 days later, Medicaid retroactively pays for those previous 30 days. That period for babies used to be 90 days — because we need to allow moms to recover, allow people to apply, allow eligibility determinations to be made, especially since eligibility category (income versus disability) sometimes changes and that takes time. They've shortened it from 90 days to 60 days for babies — I'm assuming for other populations too, but this is about babies, so.

That's a big deal for us, because think about all the moms we deliver who end up staying in the ICU or on the floor because their blood pressure is still so high they're not weaned off medication for a week or two — then they're working on lactation, transportation, their jobs, everything else. Medicaid application is not front and center the minute you deliver a 24-weeker, a 23-weeker, or even a full-term baby with a heart defect. You're obviously juggling a lot of other priorities. So the ability to go to states or the federal government and say, "we're not trying to undo HR1, but this one piece that disproportionately hurts mothers and babies — can we just tweak that?" — that's how we get our foot in the door to start looking at other pieces of rolling back the cuts. And neonatologists aren't doing this work alone — the AAP is there, the Children's Hospital Association, the Academic Pediatric Association — a whole group of organizations dedicated to minimizing harm to children.

Ben Courchia, MD (48:17.149) I had a patient in exactly this scenario — the mother in the ICU, the baby in the NICU, and the father trying to keep up with two family members hospitalized in critical condition, children at home, school, just surviving one day at a time. Administrative paperwork isn't the priority. I think this will resonate with anyone who's cared for babies in the NICU and spoken with these families.

Shetal Shah (48:46.041) Just think of it this way: it's intrusive enough that we go into these ICUs or onto the floors and put a stack of consent forms in front of families — "can you consent for central lines, NICU admission, donor milk" — for life-saving measures — and by the way, here's a burdensome one-to-forty-page Medicaid application you need to start on right away, or your kid won't be covered. It's almost inhumane.

Ben Courchia, MD (49:15.697) It's nuts. I think we're over time, and I want to wrap up by channeling some of what we've discussed. For people who want to participate in efforts to support children and make sure these cuts don't affect our patients — Stephanie, you mentioned looking up your local AAP chapter, which should be easy; if you Google your state name plus "chapter" plus "AAP," you should be pointed in the right direction quickly. What other avenues would you recommend? Stephanie, I'll let you go first.

Stephanie Glier (50:07.389) Sure — AAP, of course, but we also have direct advocacy options. If you're an AAP member, you can log into our Advocacy Action Center, which gives you a direct link to write to your federal policymakers. You can also look that up yourself and write to them directly — it's always important to share what you're seeing with the people you've elected to represent you.

There's also a more local option: talking to your own program administrators, hospital administrators, even the social workers in your NICU or department, about what they're preparing for and how they're seeing these changes show up with your patient population. Understanding what this looks like for the families coming through your clinic is really important, both to educate yourself and to be able to share it with social workers or administrators — letting them know the new needs, so families get the information they need to keep their kids covered.

Ben Courchia, MD (51:12.359) I believe it's now a requirement for level 3 NICUs to have a social worker — I think it's never been a more critical time to have strong social work support in the NICU. Shetal, any advice beyond what you've already shared?

Shetal Shah (51:27.149) I'd take it one step further. The AAP creates great high-level resources — some done by state chapters focused on state issues, others by the federal office focused on federal policy. Take those, read them, filter them through your own experience. Ben, you and I both encounter moms who deliver because they're preeclamptic and still need to be on magnesium and labetalol and a whole bunch of other agents to get their blood pressure down and avoid a stroke. Filter that experience, take it with you, call your local Congressperson and the closest Senate office to where you live, and make an appointment. They work for you.

If you say, "I want to come in and talk about how HR1, or this policy or that policy, is impacting my ability to deliver care at our local children's hospital, or our local major NICU" — for some reason people feel really disempowered about this kind of thing, and I find it funny, because — I say this to the fellows, so I feel bad recycling it — every single day, people hand us a baby who isn't breathing, and we just start providing PPV (Positive Pressure Ventilation), start providing life-saving treatment to neonates, because we do it every day. That's not intimidating. But somehow talking to a congressional staffer about federal policy feels more intimidating than resuscitating a baby. It seems strange how we see the world.

Ben Courchia, MD (53:14.452) I feel like we don't feel we have the knowledge to engage with that population, compared to neonates, where we've spent years learning the mechanics, so we feel more comfortable there.

Shetal Shah (53:26.947) Ben, I guarantee every neonatologist listening will do a better job talking to their congressional staff person than that staff person would do resuscitating even a 34-weeker. It's just a different skill, but you have to develop that relationship. One of my dreams is that every member of Congress, every congressional staffer, has a neonatologist in their phone they can call and say, "Dr. Korsha, I have a question — this came across my desk, what do you think this means for our district in Florida, for our state?" And you can say, "here's what I think, but let me find out," then call Stephanie, then call them back. All of that filters up through personal relationships, and it's incredibly important.

Ben Courchia, MD (54:17.94) This was a phenomenal conversation — we're over time, but it didn't feel like it. Shetal, Stephanie, thank you both very much for coming back on the podcast to discuss this with us. We'll leave all these links in the show description so people can find you if they have more questions, or need a pep talk before making that phone call, Shetal. Thank you both.