Happy New Year and welcome back. Congress is in session this month to address, at a minimum, government funding, but there are signs that other healthcare provisions could be included if a deal comes together. It is looking less likely that extending Affordable Care Act tax credits will happen, despite a three-year extension passing in the House, while there are ongoing negotiations around funding for community health centers and reforming pharmacy benefit managers. In this month’s update, we focus on the latest on H-1B visa fees and state activities around health workforce issues.
H-1B Fee Update
There are growing calls for an exemption from the $100,000 H-1B visa fee for health care workers following last month’s court decision. In December, a federal court rejected a request to strike down the Administration’s $100,000 entry fee for H-1B visa holders, upholding the Administration’s authority to condition H-1B visa approval on this payment. The case heads to the US Court of Appeals for a hearing in February, but it is clear a resolution may be months away.
This is problematic for the upcoming match in March when medical students learn their residency placements. The Match relies heavily on international medical graduates (IMGs), who filled nearly 17% of program year 1 (PGY-1) positions in 2025. Without any further guidance this could affect how residency programs handle applicants who require H-1B sponsorship. It also puts more emphasis on J-1 visa pathways, since visa holders already in the country when applying for the H-1B are not subject to the fee.
Members of the New Democrat Coalition sent a letter this month to the Department of Homeland Security to exempt health care workers from a new H-1B visa fee. This is a welcome letter, but it will likely not be taken seriously by the Administration unless it is bipartisan. We are working on identifying Republicans who may be willing to lead a letter on this topic, given the mounting pressure on hospitals and other providers who rely on IMGs, not to mention the patient access concerns.
At this time, the Administration has indicated they will only consider exemptions to the fee on a case-by-case basis. AAPPR is working with other national health care stakeholder organizations on pursuing individual exemptions while also securing a broad exemption for healthcare workers. If you are navigating the H-1B process for candidates or have questions on best practices, we are ready to assist you.
States Efforts to Address Workforce Shortages
It is no secret that healthcare shortages present an urgent threat to patient access. We are monitoring what states are doing to identify trends or successful efforts that can be replicated or used to leverage action at the federal level. In Pennsylvania, State Rep. Kathy Rapp, Republican Chair of the Houe Health Committee, wrote a letter to Dr. Mehmet Oz, the Administration of the Centers for Medicare & Medicaid Services (CMS), asking him to accelerate funding due to hospitals ceasing labor and delivery services. In her letter, she highlighted the Conrad 30 program as a solution to help address shortages, in addition to increasing the number of residency slots.
In Alabama, lawmakers introduced a bill to overhaul the state’s existing rural physician tax credit by increasing the annual incentive from $5,000 to $10,000. Beginnning in 2027, eligible physicians who live and practice in rural communities could receive this credit for up to four years.
In Mississippi, an article appeared in the Mississippi Independent highlighting the importance of foreign doctors across the state, and the potential risks to patient access should the H-1B fee remain in effect. It is important to see articles like this because it creates an opening to discuss with lawmakers the importance of international physicians to patient access.
AAPPR is working on a state grant program that would award grants to employers who secure a J-1 visa waiver through the Conrad 30 program, to support the recruitment and retention of that physician.
Update on Efforts to Extend ACA Tax Credits
The House has passed a three-year extension of ACA premium tax credits, but Senate talks have stalled over abortion-funding (Hyde) language, leaving little room for compromise. Even if negotiators reach a deal, it would still need broad Senate support, a House vote if amended, and White House sign-off, as marketplace open enrollment ends today with initial enrollment down by 1.4 million. Lawmakers have floated extending open enrollment if a deal materializes, but with the Senate leaving town and end-of-January deadlines for other priorities, prospects are dimming by the day.
An Interesting Event – Online!
On January 22nd, tune in to hear from Sungchul Park, Associate Professor at the Department of Health Policy and Management at Korea University, to discuss healthcare workforce shortages and patient outcomes at Stanford University. He will discuss how an 18-month nationwide walkout by South Korea’s trainee doctors led to worse patient outcomes, fewer hospital and clinic visits, and higher costs per hospital stay. The study highlights how vulnerable health systems are to staffing disruptions and the need for stronger workforce resilience.