Reservoir Health: Shaping the Policy Environment

More than 66 million Americans live in rural communities, where access to care depends on far more than insurance coverage. Long distances, workforce shortages, limited broadband and transportation, and hospital and pharmacy closures can delay everything from routine screening to specialized treatment.

Rural health is a critical test of whether policy delivers care patients can actually obtain. State policymakers influence that access through Medicaid, state-regulated commercial insurance, and state employee health plans. As the 2027 legislative sessions approach, several issues will challenge their ability to turn policy commitments into practical improvements.

Rural Americans face worse outcomes and a fragile care infrastructure.

Rural residents are more likely than urban residents to die prematurely from heart disease, cancer, stroke, respiratory disease, and unintentional injuries. The CDC estimates that tens of thousands of these deaths may be preventable. Provider shortages and closures make these conditions harder to prevent, diagnose, and treat.

Policymakers must protect the resources that sustain rural care while ensuring they benefit patients. The 340B Drug Pricing Program, for example, can support eligible rural hospitals, but its savings do not automatically lower patients’ costs. The challenge is balancing financial support for local services with transparency and accountability for how those savings improve access.

Access begins long before treatment.

Covered treatments offer little benefit to patients who are never screened, diagnosed, or connected to a provider. Rural access therefore starts with primary care, prevention, and timely diagnostic testing.

Complex chronic conditions, including cancer, Alzheimer’s disease and cardiometabolic care, reflect this challenging dynamic. Biomarker testing can help identify patients likely to benefit from targeted therapies, while emerging blood-based tests offer new possibilities for early detection.  

State coverage policies for biomarker testing are expanding, with opportunities to address additional conditions. Yet rural patients may still struggle to reach testing facilities and specialists. These laws also vary in which plans and tests they cover and what utilization management they permit. Policymakers must consider how prior authorization, appeals, cost-sharing, and provider availability affect whether patients receive timely testing.

Coverage does not automatically create access.

A medication can appear on a formulary yet remain difficult to obtain because of prior authorization, step therapy, or coverage changes that prompt non-medical switching. Patients may face paperwork, additional treatment trials, and appeals before receiving their prescribed therapy.

Immunology provides a clear example. A study of 17 large commercial health plans found that, across the medications studied, an average of 78.6% of plans restricted psoriasis coverage beyond the FDA label; for psoriatic arthritis, the figure was 66.8%. Medications were most commonly covered as second-line treatments. Not every restriction is inappropriate, but these findings show why formulary coverage alone is an incomplete measure of access.

Within the insurance markets they regulate, state legislators can establish timely authorization standards, workable step-therapy exceptions, and continuity-of-treatment protections. These measures can help patients obtain clinically appropriate care without avoidable delays.

Policy choices can reduce or deepen rural disparities.

The federal budget legislation enacted in 2025 will put Medicaid at the center of state debates in 2027. New eligibility requirements and financing changes will force difficult choices about coverage, services, and provider payments. More frequent eligibility reviews and work requirements for certain adults also create a risk that eligible patients will lose coverage because of paperwork barriers.

Lawmakers will need to weigh additional Medicaid funding against competing budget priorities. Reducing services or provider payments could make care harder to obtain, while underfunding eligibility systems and enrollment assistance could increase coverage losses. Their budget decisions will shape both who remains insured and whether providers can continue serving them.

Rural health presents a major policy and advocacy opportunity.

The federal Rural Health Transformation Program will direct $50 billion to states from 2026 through 2030, supporting investments in prevention, chronic disease management, workforce, technology, and new care delivery models.

Stakeholders can help shape funding priorities, implementation, and measures of success. Their involvement can keep state decisions grounded in patients’ needs across prevention, diagnosis, treatment, and follow-up care.

The test for 2027 is whether these decisions make timely, effective care easier to obtain. How states meet that challenge in rural communities will offer an early indication of whether broader health policy is improving access in practice.

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Congressional debate often reduces a policy’s fiscal impact to one number: how much it is expected to save or cost over ten years.

That number can determine whether legislation advances, how it is designed and how stakeholders advocate for or against it.

But a score is not a fixed prediction. It is an estimate based on the policy language, available evidence and assumptions about how stakeholders will respond.

Recent Congressional Budget Office (CBO) revisions involving Medicare drug policy show why these estimates are becoming more difficult to produce and why understanding what sits behind the headline number is increasingly important.

Why it matters: The score can shape the policy  

CBO scores influence whether a proposal is considered politically and procedurally viable, which provisions are changed or removed, what offsets lawmakers need and how stakeholders frame the policy’s potential benefits and tradeoffs.

The challenge is that health policies rarely operate in isolation. A change in one part of Medicare can alter incentives and behavior elsewhere, sometimes in ways that cannot be fully anticipated before implementation.

A score may be a critical input into policy and advocacy strategy, but the number alone does not reveal which assumptions drive the result, where uncertainty is greatest or where unintended consequences may emerge.

Zooming in: Two recent revisions, two sources of uncertainty

Technical details can change the estimate

In July 2025, CBO estimated that changes to the Inflation Reduction Act’s (IRA’s) orphan-drug exemption would increase federal spending by $4.9 billion over ten years.

After outside experts raised questions about additional products that could be affected, CBO conducted further analysis and revised the estimate to $8.8 billion. CBO also found that the cost could range from $6.7 billion to $10.9 billion, depending partly on how the Centers for Medicare & Medicaid Services (CMS) treats different formulations of affected products.

What this shows: Understanding a proposal’s effects requires more than interpreting its statutory language. It also requires detailed knowledge of the products, programs and markets the policy would affect.

The market may respond differently than expected

In 2022, CBO estimated that the IRA’s major Medicare Part D drug provisions would reduce federal deficits by $129 billion through 2031. CBO now projects that those provisions, taken together, will increase deficits over the same period because:

• Negotiated prices produced smaller initial net-price reductions than CBO anticipated.

• Higher inflation reduced projected savings from manufacturer inflation rebates.

• Part D costs and prescription drug use grew more rapidly than expected.

• Plan bids, and the resulting federal subsidies, were substantially higher than projected.

What this shows: Policy can change behavior throughout the health care system: patients may use more medicines when out-of-pocket costs decline, plans may adjust bids, formularies and utilization management, and manufacturers may change pricing and market strategies. These effects are difficult to isolate and even harder to predict before a policy takes effect.

The takeaway: One score is not enough

The lesson is not that scoring has become less useful. Rather, a single point estimate may provide false precision when a policy depends on uncertain implementation decisions and behavioral responses.

A more decision-useful analysis should identify:

• The assumptions with the greatest influence on the estimate

• The evidence supporting those assumptions, including evidence gaps

• Product or market details that could change the result

• Unresolved agency implementation decisions

• Potential stakeholder responses

• Plausible alternative outcomes

Instead of relying on one estimate, policymakers and stakeholders should examine a central scenario alongside credible higher- and lower-impact scenarios. Sensitivity analysis can show how the result changes when critical assumptions shift.

The goal is not to predict the future with perfect accuracy. It is to understand the conditions under which a policy is likely to achieve its objectives and where it could produce unintended consequences.

From scoring to strategy

CBO-style scoring can inform strategy well beyond the headline budget impact.  

A thoughtful analysis can help stakeholders identify major cost drivers, test policy modifications, anticipate questions from policymakers, strengthen the evidence supporting a proposal and prepare for alternative implementation approaches.

It can also support advocacy messages that acknowledge uncertainty while clearly explaining the policy’s rationale and likely effects.

The bottom line

As health policies become more interconnected, scoring them will become more difficult. That makes rigorous analysis more important, not less.

The most useful CBO-style analysis connects the number to the policy choices behind it. It considers multiple plausible scenarios, makes uncertainty visible and gives policymakers and stakeholders a stronger foundation for deciding how to design, defend or improve a proposal.

Go deeper:

• Developments in CBO’s Projections for Medicare Part D

• Revised Estimate of the Orphan-Drug Exemption Changes

To learn more about Reservoir's CBO-style scoring and other analytical capabilities, contact Ashley Flint at aflint@reservoirhealth.com.

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Short state legislative sessions are not simply compressed versions of longer ones. They are faster, more crowded, and less forgiving. Bills can move from introduction to committee action in days, while budget negotiations and leadership priorities leave little room for unfamiliar issues. Organizations that wait for the opening gavel to begin educating stakeholders are already behind.

The pressure will be especially intense in 2027, when six states — Florida, Louisiana, Utah, Virginia, West Virginia, and Wyoming — are scheduled to complete their regular sessions in approximately 60 days or less. In these environments, policymaker education, coalition building, and message preparation must begin well before lawmakers convene.

Preparation begins with clarity about the problem, the desired policy outcome, and the forces likely to shape the debate. In a compressed session, evidence must do more than establish credibility; it must make the issue immediately relevant to the state and its priorities. Policymakers need to understand why action is necessary, what is at stake for constituents, and how the issue intersects with fiscal and political realities.

Credible voices are equally important. Clinicians, researchers, community leaders, employers, and patient advocates can translate complex evidence into perspectives that resonate with different audiences. When these leaders are informed, aligned, and ready to engage, they can elevate an emerging concern, counter misinformation, and give decision-makers greater confidence in the path forward.

Legislative success also depends on support that extends beyond a single bill sponsor. A durable network of policymakers, agency officials, staff, and outside organizations can create broader ownership of the issue and sustain momentum as priorities shift. The strongest champions do more than endorse a proposal; they help establish its relevance, bring others into the conversation, and position it for meaningful consideration.

In a short session, agility matters, but agility is built through preparation. When the window opens, successful campaigns already have the evidence, voices, visibility, and champions needed to move.