More kids are landing in the hospital due to COVID, and it's not yet clear whether it's because the Delta variant is causing more serious illness.

Driving the news: The latest numbers from the American Academy of Pediatrics show there were nearly 94,000 cases of COVID among kids in the last week, or about 15% of weekly total cases.

• While serious illness in kids is still comparatively low compared to adults, pediatric hospitalizations for COVID in some areas of the country have reached worrying levels.
• There is an "epidemic" of very young COVID patients at Children's Hospital New Orleans, physician-in-chief Mark Kline told Robin Roberts on "Good Morning America." Half the kids in the hospital are under two years old, he said.

Between the lines: Experts generally agree that Delta's high rates of transmission in areas with low vaccination rates are making this problem worse.

• "There's a clear and direct correlation. It's not a confusing picture," Roberta DeBiasi, chief of infectious diseases at Children's National Hospital in Washington, D.C., told Axios.

But they aren't sure whether the variant is causing more severe illness.

• "I do think we're seeing more severe disease and I think part of that is because the kids we're seeing don't have underlying medical conditions," Kenneth Alexander, infectious diseases division chief for Nemours Children's in Orlando told Axios.

Go deeper: Urgency grows around children's COVID as pediatric hospitalizations soar

Democrats will likely have to take on the powerful pharmaceutical industry in order to pass some of the most popular health care policies in their reconciliation bill — including coverage expansions that pharma doesn't oppose, Axios' Caitlin Owens writes.

• The plan includes paid family and medical leave and an expansion of long-term care for seniors and people with disabilities.
• It would also extend the expansion of ACA premium subsidies; expand Medicare to include dental, hearing and vision benefits; and allow Medicare to negotiate drug prices.
• It's still unclear whether either chamber has enough Democratic votes to allow Medicare to negotiate drug prices, and the pharmaceutical industry and its allies will do everything possible to make sure the effort fails.

The bottom line: "Keep a close eye on how successful Democrats are in building consensus around sweeping plans to lower drug prices," tweeted KFF's Larry Levitt.

• "If those plans get scaled back and there are lower savings, the expansion in health care benefits and coverage will get scaled back, too."

Go deeper: Inside Democrats' $3.5 trillion box

The Biden administration axed Trump's proposed rule that would have tied some Medicare drug prices to lower overseas prices. But that regulation in its current form had almost no chance of being enacted, Axios' Bob Herman writes.

The state of play: The Trump administration's "most favored nation" rule was tied up in court and likely illegal.

• However, rescinding the rule "does not reflect any judgment by HHS regarding future policy," the federal government said.
• That means Biden isn't necessarily giving up on changing how Medicare pays for Part B drugs, but any new version of that rule would likely have to be scaled back to avoid lawsuits.

What to watch: Biden's recent executive order mandates HHS create a "comprehensive plan ... to combat high prescription drug prices and price gouging" by Aug. 23.

• That will give the clearest picture of what Biden will try to do to lower drug prices.

The bottom line: There are a handful of drug pricing proposals floating around. Drug companies are fighting them, and want to preserve one thing more than anything else.

• "To continue to have the ability to set launch prices. That's the Holy Grail," a pharmaceutical lobbyist said.

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Vice President Kamala Harris will announce today that 2.5 million people have signed up for ACA health plans during the special enrollment period.

• Harris will speak at Unity Health Care's Brentwood Health Center in D.C. in a final push for more signups before the Aug. 15 deadline.

Tenet Healthcare Corp. CEO Ron Rittemeyer will step down as CEO next month, the hospital system giant announced yesterday.

Driving the news: Rittenmeyer, who served as chief executive and executive chairman for nearly four years, will be replaced by chief operating officer Saum Sutaria on Sept. 1.

• Rittenmeyer will continue as executive chairman of the company and the board through 2022, Tenet said.

A number of employers have not only begun offering rewards to workers for getting vaccinated, some may also charge financial penalties to those who don't, Forbes reports.

Why it matters: While plenty of U.S. companies turned more to "carrots" to incentivize vaccination earlier on in the pandemic, employers are increasingly cracking down with mandates and making make it harder for workers to skip the shot.

What they're saying: Health benefit consultancy Mercer says some employers are beginning to institute a special surcharge of anywhere between $20 and $50 a month to their unvaccinated employees, per Forbes.

• "We have received inquiries from at least 20 employers over the past few weeks who are giving consideration to adding health coverage surcharges for the unvaccinated as a way to drive up vaccination rates in their workforce," Mercer's regulatory resources group leader, Wade Symons, told Forbes.