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This is the strategist in brief for May 22nd, 2025. Today's edition begins with some breaking news. The house voted to advance the Republicans budget reconciliation bill, giving lawmakers a chance to enact sweeping spending changes without democratic support. The bill includes an extension of the 2017 tax cuts and funding increases for border security and defense paid for in part with Medicaid cuts. The Medicaid provisions include work requirements, reduced incentives for expansion to low income adults, reduced funds for states that offer benefits to undocumented immigrants, more frequent redeterminations and shorter retroactive coverage. The Congressional Budget Office estimates that these provisions would save the federal government$625 billion over 10 years and increase the number of uninsured Americans by 7.6 million These figures could be higher after a last minute amendment moved up. The proposed start date for work requirements. if the legislation is enacted. Health systems can expect more uncompensated care and coverage. Churn. Impacted populations may have less access to preventive care, leading to higher acuity visits in ED or urgent care settings. Health systems need to stress test their capital plans against scenarios involving higher uninsured rates, service line shifts and reduced payment rates. For this week's key market dive we're aggregating insights gathered from interviews with supply chain officers and strategy leaders on the health system response to the Trump administration's tariff policies. The Trump administration said it would back off of its steepest tariffs on China for a 90 day pause, lowering the tariff rate from 145% to 30%. There's still substantial uncertainty, but also a growing sense of optimism across the healthcare industry that the worst case scenarios will be averted. Supply chain officers anticipate cost increases, but there's less consensus on the exact level. Health systems are aggressively challenging. Early price increases proposed by suppliers and worry about locking in higher prices if the crisis subsides outright. Supply disruptions seem less likely, but many systems are nonetheless increasing their stockpiles of critical goods. Many systems are reassessing capital plans and investing cautiously amid the economic uncertainty. Supply chain leaders are adopting lessons from the pandemic and using the disruption as an opportunity to shake up their relationships with suppliers in a constructive way. Moving on to other news, a federal judge ruled that pharmaceutical companies can't withhold upfront three 40 B discounts without federal approval, but also ask the health Resources and services administration to reconsider Sanofi's proposed rebate model. The ruling is a clear win for health systems that have come to rely on the program savings for their margins. Some health system leaders have compared the drug makers rebate proposals to the prior authorization and denials arms race with payers. Drug makers have continued to push the narrative that the three 40 B program has grown beyond its original intent, and Congress is debating multiple reform proposals. And now to our last piece of news, virtual chronic care providers, OMA Health, filed for an IPO on May 9th. It's the second digital health IPO this year following Hinge Health. Healthcare IPOs on US exchanges raised$7.1 billion in 2024, up from 2.8 billion in 2023 Marking a tentative thaw on the market, but trade policy and interest rate shifts could undo that progress. That concludes this week's edition. Be sure to check out the full version on the web@hmacademy.com. Thanks for listening.