Looking Ahead: Reconciliation Markups Postponed
Reconciliation markups in the U.S. House of Representatives Committee on Energy and Commerce, as well as the House Committee on Ways and Means, were expected to be held this week but have been postponed until next week at the earliest. In the interim, House Republican leadership will continue navigating forward to find an agreement on spending and savings targets. Additionally, on May 14, 2025, at 1 p.m., the U.S. Senate Committee on Health, Education, Labor, and Pensions (HELP) will hold a hearing with U.S. Department of Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. to discuss President Donald Trump's proposed HHS budget for fiscal year (FY) 2026. This is the first time in at least two decades that the HHS secretary is testifying on a presidential budget before the HELP Committee.
Hearings This Week: New Nominations
The House Committee on Oversight and Government Reform (OGR) will hold a hearing titled "Examining the Growth of the Welfare State, Part II" on May 7, 2025, at 10 a.m.
The Senate HELP Committee will hold a hearing on May 8, 2025, at 10 a.m. on the nominations of Jim O'Neill to serve as deputy HHS secretary and Janette Nesheiwat to serve as surgeon general of the U.S. Public Health Service Commissioned Corps and medical director in the Regular Corps of the Public Health Service.
Week in Review: FY 2026 Proposal
Last week, the Trump Administration released its budget proposal for FY 2026, leaving it up to U.S. Congress to fulfill House Speaker Mike Johnson's (R-La.) increasingly lofty Memorial Day deadline.
Administrative Updates
Executive Order Updates
The Trump Administration has continued to release wide-ranging executive orders (EOs). For brief overviews of the numerous orders published by the Trump Administration, see our "Trump's 2025 Executive Orders: Updates and Summaries" tracking chart.
Trump Administration's "Skinny Budget" Request Released
The Trump Administration released its "skinny" budget proposal for FY 2026 on May 2, 2025. Following changes in the Trump Administration, shorter budget proposals are normally released to provide an overview of the administration's vision for federal funding. While Congress is not required to pass annual funding legislation that is identical to the budget proposal, the budget proposal messages to Congress are what the Trump Administration views as most important for the coming FY.
The budget proposes reducing nondefense discretionary funding by $163 billion in FY 2026, a 22.6 percent reduction from current funding levels. Many programs and initiatives at HHS would be reduced or eliminated, with the budget proposing a $33 billion cut. The budget proposal also increases funding for defense programs and border security by 13 percent from the current year to $1.01 trillion. The budget proposal assumes that $325 billion in funding will be provided through the passage of a budget reconciliation package to increase funding for defense, immigration, and energy policies and programs.
There are several major changes to healthcare programs included in the budget proposal, including components that would effectuate the reorganization of HHS:
- An estimated $500 million will be allocated to support the activities of the Make America Healthy Again (MAHA) Commission and the MAHA initiative, including those that allow Secretary Kennedy to address "nutrition, physical activity, healthy lifestyles, over-reliance on medication and treatments, the effects of new technology habits, environmental impacts, and food and drug quality and safety" across the HHS. Programs on sexual risk avoidance, teen pregnancy prevention and the HHS Office of Women's Health (OASH) are eliminated or folded into the new Administration for a Healthy America (AHA).
- A $1.7 billion reduction in funding will be made to the Health Resources and Services Administration (HRSA). The proposal breaks apart programs previously part of HRSA and consolidates programs formerly under HRSA to other offices within the HHS that "do not focus on core healthcare and support services," including the Ryan White HIV/AIDS Program, maternal and child health programs, healthcare workforce programs and family planning services. An additional $6 billion for "priority activities" is retained.
- A $3.5 billion reduction will be made to the Centers for Disease Control and Prevention (CDC). Funding will refocus the mission of the CDC on emerging and infectious diseases and surveillance, outbreak investigations and public health infrastructure. It will eliminate the National Center for Chronic Disease Prevention and Health Promotion (NCCDPHP), National Center for Environmental Health (NCEH), National Center for Injury Prevention and Control (NCIPC), CDC's Global Health Center, U.S. Food and Drug Administration's (FDA) Office of Public Health Preparedness and Response, and Preventive Health and Health Services (PHHS) Block Grant.
- A $17.9 billion reduction will be made to the National Institutes of Health (NIH). The proposal restructures the NIH institutes by consolidating the institutes into five focus areas: National Institute on Body Systems Research, National Institute on Neuroscience and Brain Research, National Institute of General Medical Sciences, National Institute of Disability Related Research, and National Institute on Behavioral Health. The Advanced Research Projects Agency for Health (ARPA-H) is retained.
- A $1 billion reduction will be made to the Substance Abuse and Mental Health Services Administration (SAMHSA).
- A $129 million reduction will be made to the Agency for Healthcare Research and Quality (AHRQ). The AHRQ also would be moved into the HHS Office of Strategy.
- A $674 million reduction will be made to the Centers for Medicare & Medicaid Services (CMS). Outreach related to health equity and education on the Inflation Reduction Act (IRA) will end.
- A $240 million reduction will be made to the Administration for Strategic Preparedness and Response (ASPR) Hospital Preparedness Program.
OSTP Publishes 10,000 public comments on AI RFI
The White House Office of Science and Technology Policy (OSTP) published more than 10,000 public comments on April 24, 2025, submitted in response to the request for information (RFI) on the development of the Artificial Intelligence (AI) Action Plan. The RFI sought input on AI policy priorities from interested public parties, including academia, industry groups, private sector organizations and state, local and tribal governments.
Legislative Updates
Reconciliation Markups This Week
Though the House Energy and Commerce and House Ways and Means Committees were expected to hold a markup of their sections of the reconciliation package this week, markups in both committees were delayed until the week of May 12, 2025, at the earliest. House Republican leaders are still working to bridge the divide between members of the conference who want higher levels of spending reductions, including members of the House Freedom Caucus and moderates who oppose cuts to Medicaid – specifically cuts to beneficiary benefits.
Energy and Commerce Committee Democratic Staff Release Report on Medicaid Work Requirements
The Democratic staff of the House Energy and Commerce Committee released a report on May 1, 2025, titled "Red Tape Requirements: Republicans' Scheme to take Health Care Away to Make the Richer Richer." The report seeks to blunt efforts under consideration by Republicans to subject Medicaid beneficiaries to new work requirements as a condition of receiving coverage. Two states – Arkansas and Georgia – have work requirements in place today. While other states have previously pursued waivers from the CMS to implement work requirements, the majority were the subject of legal challenges and halted as a result, were rescinded by the previous administration or pulled back by states. The report details several case studies involving states that have in place or previously had work requirements for Medicaid beneficiaries, as well as discusses several beneficiary stories as evidence of the impact that new work requirements may have on patients. As Republicans continue to pursue changes to the Medicaid program as part of reconciliation – regardless of the substance of the changes – Democrats will continue to focus on patient impacts that may result from changes to Medicaid.
Bill to Increase Medicare Mental Health Pay Moves Forward
The Connecting Our Medical Providers with Links to Expand Tailored and Effective Care Act (COMPLETE Care Act) was referred to the Senate Committee on Finance. The legislation, if included in a healthcare package later in the year, aims to improve behavioral health access by increasing Medicare mental health payments and by directing Secretary Kennedy to establish quality measurement reporting requirements for applicable clinicians on behavioral health integration. While the focus of Congress remains limited to moving a budget forward, potential items for inclusion in a later year healthcare package are beginning to line up.
Regulatory Updates
NIH Announces New Initiative to Reduce Use of Animals in NIH-Funded Research
The NIH announced a new initiative on April 29, 2025, to reduce the use of animals in NIH-funded research and expand the use of new and emerging technologies to support biomedical research. The initiative follows a similar announcement by the FDA on April 10, 2025, that it would phase out the use of animal testing requirements for monoclonal antibodies and certain drugs. The NIH will establish the Office of Research Innovation, Validation and Application (ORIVA) within the NIH to coordinate efforts to advance the initiative, evaluate funding for non-animal approaches and assess their utility for use in research. Congress has previously passed legislation to authorize the use of non-animal alternatives for investigational new drug applications, which paved the way for new initiatives at NIH and the FDA focused on reducing the use of animals in research.
HHS Releases Report on Children's Access to Gender-Affirming Care
The HHS released a 400-page report on May 1, 2025, titled "Treatment of Pediatric Gender Dysphoria: Review of Evidence and Best Practices." EO 14187, "Protecting Children From Chemical and Surgical Mutilation," which was signed on Jan. 28, 2025, directed the report that was intended to review evidence and best practices related to treatment of gender dysphoria. While the report indicates that chapters of the review were subject to peer review and HHS noted the report represents a wide array of viewpoints, the report does not include authors' names, their professional backgrounds or clinical expertise and affiliations. The report contends that current approaches to treating transgender youth are misguided. The report also notes there is limited evidence regarding the effects of providing gender-affirming care and casts doubt on previously completed studies linking the provision of gender-affirming care to improved mental health outcomes. The report also alleges that clinicians and health facilities providing the care today have "fallen short of their duty to prioritize the health interests of young patients." The report suggests mental healthcare such as psychotherapy as an alternative to gender-affirming care and calls for additional research on the impact of psychotherapy on pediatric patients and gender dysphoria.
Following the report's release, several major medical associations representing pediatricians and other clinicians that provide gender-affirming care issued statements criticizing the report for inaccurately representing previously completed research studies and presenting a one-sided viewpoint of an important medical issue. The report may set the stage for congressional action and attempts to limit access to gender-affirming care either through the annual appropriations process or another legislative vehicle.
Legal Updates
DOJ Files Suit Against Large Health Insurers and Brokers Related to Medicare Advantage
The U.S. Department of Justice (DOJ) sued three large health insurance companies and three large broker companies on May 1, 2025, for illegally steering beneficiaries to certain Medicare Advantage (MA) plans in exchange for improper payments. Many private insurance companies have arrangements with brokers to help patients identify an MA plan that works best for them and enroll the beneficiary. Brokers receive commission from insurance companies based on the beneficiaries they enroll. The relationship between private insurance companies that offer MA plans and brokers have previously received attention from the Senate Finance Committee under the leadership of then-Chair Ron Wyden (D-Ore.). The Senate Finance Committee held a hearing on this issue during the 118th Congress following reports that some beneficiaries had their enrollment in various health plans changed without their knowledge by brokers who sought higher commission payments.
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