Samwise Healthcare IT Newsletter
Monday, May 25, 2026
Hospitals File $250M Lawsuit Against CVS Over 340B Drug Discount Siphoning
Mount Sinai Health System, University of Michigan Health, and University of Kansas Health System filed a $250 million federal lawsuit against CVS Health, alleging the pharmacy giant operated a secret pricing scheme that systematically siphoned 340B drug discount savings away from safety-net hospitals between 2020 and 2025. The complaint accuses CVS of artificially deflating reimbursement rates for 340B-purchased drugs dispensed at CVS retail pharmacies under contract pharmacy arrangements, diverting funds intended to support care for low-income patients. CVS declined to comment. The filing is among the largest financial claims yet brought against a pharmacy benefit manager under the 340B program's contract pharmacy provisions.
Sources: Healthcare Dive
HHS Launches AI-Powered AERO System to Detect and Penalize Grant Fraud
The Department of Health and Human Services launched AERO — Audit Enforcement and Risk Oversight — an AI-backed initiative to detect and penalize financial fraud among states and federal grantees. The system analyzes more than five years of audit data to identify chronic noncompliance, and gives HHS authority to withhold, suspend, or terminate funds. Gustav Chiarello, HHS chief financial officer, described AERO as a force multiplier allowing a small federal team to monitor grantee behavior at a scale previously impossible. The initiative arrives amid a broader Trump administration push to reduce improper payments across social programs, with Medicaid and Title IV grant recipients among the initial targets.
Sources: Healthcare Dive
Trump Administration Proposes Capping Medicaid State-Directed Payments at Medicare Rates
The Trump administration has proposed rules that would cap Medicaid state-directed payments at 100 percent of Medicare rates for most services and 110 percent for primary care, projected to save up to $510 billion over the next decade if finalized. Forty-one states currently use state-directed payments to supplement provider reimbursement, and the American Hospital Association warned the proposal could force hospitals in rural and underserved areas to curtail services or close. CMS framed the caps as necessary to prevent states from gaming federal matching funds. A phase-down period beginning in 2028 is included to limit immediate disruption.
Sources: Healthcare Dive
60 Authorized AI Medical Devices Linked to 182 Recalls, Most Within First Year
A JAMA Health Forum analysis linked 60 FDA-authorized artificial intelligence-enabled medical devices to 182 recall events, with 43 percent of those recalls occurring within the first year of market clearance. The findings, drawn from ARISE network's State of Clinical AI 2026 report, reveal a significant gap between laboratory validation and real-world clinical performance. Most recalled devices had not been tested on the patient populations that ultimately used them. Researchers attributed the pattern to AI systems trained on narrow academic datasets that fail to generalize across age, comorbidity, and site-of-care variation. Authors called for mandatory post-market surveillance requirements for all AI-enabled devices cleared through FDA's 510(k) pathway.
Sources: Healthcare IT News
Innovaccer Acquires CaduceusHealth for $66M to Expand Agentic RCM Capabilities
Innovaccer has acquired CaduceusHealth in a $66 million deal, expanding its AI-powered revenue cycle management capabilities. CaduceusHealth serves approximately 4,000 healthcare providers and manages over $5 billion in gross patient charges annually. The acquisition adds agentic RCM functionality to Innovaccer's Flow suite, enabling end-to-end automation of billing, claims, and prior authorization workflows. Innovaccer chief executive Abhinav Shashank described the combination as a step toward fully autonomous revenue cycle operations. The deal positions Innovaccer to compete more directly with established RCM vendors as health systems face mounting pressure to reduce administrative costs and close growing collection gaps.
Sources: HIT Consultant
AI Identifies More At-Risk Patients, But Health Systems Struggle to Meet Demand
As artificial intelligence tools identify ever-larger pools of at-risk patients, health systems are confronting a capacity problem they did not anticipate: the patient pipeline is expanding faster than care delivery can absorb it. Stanford Health Care CIDO Michael Pfeffer, Penn Medicine CHIO Sri Adusumalli, and Jefferson Health CDO Luis Taveras all cited downstream bottlenecks — scheduling, specialist access, follow-up staffing — as the critical constraint. Flagging a patient is only the first step; connecting them to care requires redesigning workflows, not just deploying algorithms. Leaders warned that poorly managed AI-driven outreach risks frustrating both patients and clinicians without meaningful improvement in outcomes.
Sources: Becker’s Hospital Review
Identity Management Is Healthcare's Most Underrated Cybersecurity Threat, CIO Says
Children's Nebraska CIO Ryan Cameron told Becker's that identity and access management has become the most underrated threat in digital health, displacing ransomware as the primary concern at many institutions. Cameron's team participates in the DIME collaborative alongside Boston Children's Hospital and Stanford Children's, sharing threat intelligence and coordinating defensive posture. An Anthropic Mythos report found exploitable vulnerabilities in healthcare environments 83 percent of the time tested. AI-assisted attacks are accelerating the pace and sophistication of credential theft and privilege escalation. Children's Nebraska has also deployed school-based telehealth across 30 Nebraska schools — a footprint that, Cameron noted, significantly expands the system's external attack surface.
Sources: Becker’s Hospital Review
HHS OIG: PBM Vertical Integration Shows Less Than 1% Impact on Medicare Drug Costs
An HHS Office of Inspector General analysis found that vertical integration between pharmacy benefit managers and health insurers does not appear to significantly raise Medicare prescription drug costs, complicating arguments made by critics of PBM consolidation. Researchers examined 60 drugs and found less than a one-percent cost difference between vertically integrated and non-integrated plans. The Big Three PBMs — Express Scripts, CVS Caremark, and Optum Rx — collectively manage approximately 80 percent of U.S. prescriptions. The OIG cautioned that data limitations prevent firm conclusions, and that the analysis does not address rebate distribution, formulary manipulation, or non-Medicare markets. Industry groups issued competing interpretations of the findings.
Sources: Healthcare Dive
CHOC Children's Deploys AI to Reduce Clinician Burnout and Surface Pediatric Care Gaps
Dr. Steven Martel at CHOC Children's Hospital in Orange, California, is integrating AI tools into pediatric workflows to address a core structural problem: electronic health records built primarily for documentation and billing rather than clinical insight. Martel told Healthcare IT News that clinicians spend disproportionate time extracting actionable data from EHR systems not designed to surface it, a burden that contributes significantly to burnout. AI models trained on pediatric-specific data are being deployed to flag deterioration risk, surface care gaps, and reduce the cognitive load of chart review. The pediatric sector faces particular challenges because children are systematically underrepresented in the training datasets most commercial AI tools rely upon.
Sources: Healthcare IT News
Curated by JD · samwise.agency
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