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On May 30, the Department of Health and Human Services (HHS) released its Fiscal Year 2026 (FY26) discretionary budget request. This summary provides an overview of key agency estimates and justifications, including HHS, Centers for Medicare and Medicaid Services (CMS), the Food and Drug Administration (FDA), the HHS Office of Inspector General.
WHY THIS MATTERS
The annual budget request demonstrates the priorities of the administration – how they intend to staff their agencies, what policies they will work on and what programs they intend to shutter from the previous year. Congress then takes these requests and determines what will be funded through the appropriations bills. Both the House and Senate will start marking up their appropriations bills in June.
REORGANIZATION
The budget repeatedly notes the intention of HHS to drive operational efficiencies by eliminating duplicative functions and consolidating programs that have similar aims.
The budget centralizes administrative functions, reduces 28 operating divisions to 15, closes five regional offices, reduces the level of full-time employees to 90 percent of pre-COVID levels, and ending or downsizing 5,000 contracts.
Administration for a Healthy America
HHS plans to create the Administration for a Healthy America (AHA) by combining:
- Health Resources and Services Administration (HRSA)
- Substance Abuse and Mental Health Services Administration (SAMHSA)
- Office of the Assistant Secretary for Health (OASH)
- National Institute for Environmental Health Sciences (NIEHS)
- Centers for Disease Control and Prevention (CDC) – certain programs
AHA will focus on prevention including:
- primary care
- maternal and child health
- mental health
- substance use prevention and treatment
- environmental health
- HIV/AIDS
- workforce development
- policy, research, and oversight
The Administration for Children, Families, and Communities (ACFC) will be a new division at HHS and will focus on:
- Head Start
- Child Care and Development Block Grant
- social services for children
- program formerly housed in the Administration for Community Living (ACL) such as nutrition services, falls prevention services, home and community-based support, and caregiver support
- National Institute on Disability, Independent Living, and Rehab Research
The budget eliminates the following programs:
Previously in HRSA: Healthy Start, Newborn Screening for Heritable Disorders, Early Hearing Detection and Intervention, Emergency Medical Services for Children, Ryan White Part F, Rural Hospital Flexibility Grants, State Offices of Rural Health, Rural Hospital Stabilization, Family Planning, and 15 workforce programs including some Nursing workforce programs and Medical Student Education.
Previously in CDC: Youth Violence Prevention, Adverse Childhood Experiences, Firearm Injury and Mortality Prevention Research, Traumatic Brain Injury, Elderly Falls, Drowning, Other Injury Prevention Activities, Injury Control Research Centers, the National Occupational Research Agenda, Education and Research Centers, Personal Protective Technology, Other Occupational Safety and Health Research (Total Worker Health), the Amyotrophic Lateral Sclerosis (ALS) Registry, Climate and Health, Trevor’s Law, Environmental and Health Outcome Tracking Network, and Asthma.
Previously in SAMHSA: Mental Health Awareness Training, Healthy Transitions, Infant and Early Childhood Mental Health, Mental Health Children and Family Programs, Consumer and Family Network Grants, Mental Health System Transformation, Project LAUNCH, Primary and Behavioral Health Care Integration Programs, Mental Health Crisis Response Partnership Program, Homelessness Prevention, Mental Health Criminal and Juvenile Justice Programs, Assertive Community Treatment for Individuals with Serious Mental Health Illness, Homelessness Technical Assistance, Minority AIDS, Seclusion and Restraint, Minority Fellowship Program, Tribal Behavioral Health Grants, Interagency Task Force on Trauma Informed Care, Strategic Prevention Framework, Sober Truth on Prevention Underage Drinking, Screening, Brief Intervention and Referral to Treatment, Targeted Capacity Expansion, Grants to Prevent Prescription Drug and Opioid Overdose-Related Deaths, First Responder Training, Improving Access to Overdose Treatment, Pregnant and Postpartum Women, Recovery Community Services Program, Substance Abuse Treatment Children and Families, Treatment Systems for Homeless, Building
Communities of Recovery, Substance Abuse Treatment Criminal Justice activities, Emergency Department Alternatives to Opioids, Treatment, Recovery, and Workforce Support, Peer Support Technical Assistance Center, Comprehensive Opioid Recovery Centers, Youth Prevention and Recovery Initiative, and Drug Abuse Warning Network.
Previously in OASH: Office of Population Affairs, Teen Pregnancy Prevention, Secretary’s Minority HIV/ AIDS Fund, Kidney X, Stillbirth Task Force, and Sexual Risk Avoidance.
National Institutes of Health
The National Institutes of Health will be reorganized into eight institutes. Reiterating the administration’s commitment to “gold standard science,” transparency, and the restoration of scientific integrity, the request prioritizes research related to research on nutrition and environmental factors that cause chronic disease and as well the rise in autism spectrum disorder.
Assistant Secretary for a Healthy Future
The budget creates an Assistant Secretary for a Healthy Future to bring together the Administration for Strategic Preparedness and Response and the Advanced Research Project Agency for Health (ARPA-H) into the. The Assistant Secretary’s mandate includes:
- addressing chronic disease
- America-made manufacturing and rural access
- proactive approaches to healthy well-being
- healthcare security, efficiency, and transparency
- American leadership in frontier health technologies
Consumer Product Safety Commission
The budget also changes the status of the Consumer Product Safety Commission (CPSC) from an independent agency and moves the functions of the commission into the HHS Office of the Secretary.
MEDICARE
The budget mentions $119 million for a new Prevention Innovation Program to promote broadband access to nutrition and physical activity and reduce dependence on medication. Included are $20 million for the Chronic Care Telehealth Centers for Excellence Program and $8 million for the Telehealth Nutrition Services Network Grant Program.
On prior authorization, CMS will continue to test and implement AI activities in medical review and prior authorization of the Medicare fee-for-service program, including AI to review medical records and make a recommendation regarding payment. CMS will also continue to look for services or items showing unnecessary increases in volume or utilization due to fraud, waste, or abuse, for which prior authorization would be appropriate. While CMS has focused on DMEPOS items and power mobility devices, the agency notes its success in requiring prior authorization for certain outpatient hospital department services which started in FY20.
CMS is working to expedite Medicare Advantage Risk Adjustment Data Validation (RADV) audits so the agency will be current with its audits of prior payment years and new audits will be started as close to the most recent payment year as possible. CMS is also developing a strategy to make it more efficient at identifying the approximately $17 billion in overpayments while reducing agency burden by providing more effective oversight of the MA program. Recently, CMS began conducting utilization management audits for MA plans that were effective Calendar Year 2024.
The budget includes $22 million to restart the durable medical equipment, prosthetics, orthotics, and supplies competitive bidding program.
ACA MARKETPLACE
The budget assumes the enhanced premium tax credits are not extended beyond 2025. Regardless of the administration’s assumptions, extending the tax credits requires Congressional action.
In FY 2025, CMS announced a reduction in funding for the Navigator program to $10 million per year and estimates that $360 million will be saved over the next four years.
In FY 2026, CMS is proposing a Marketplace Integrity rule which would:
- revise three standards relating to past-due premium payments
- exclude Deferred Action for Childhood Arrivals recipients from the definition of “lawfully present”
- define the evidentiary standard HHS uses to assess an agent’s, broker’s, or web-broker’s potential noncompliance
- reinstate the one year requirement for failure to file and reconcile
- strengthen income eligibility verifications for premium tax credits and cost-sharing reductions
- amend annual eligibility redeterminations for consumers in $0 premium plans
- eliminate the special enrollment period for consumers with annual household incomes below 150 percent of the federal poverty level
- amend the automatic reenrollment hierarchy
- shorten the annual open enrollment period
- tighten special enrollment periods
- widen the de minimis thresholds for the actuarial value for plans subject to essential health benefits
- (EHB) requirements and for income-based cost sharing reduction plan variations
- amend the premium adjustment percentage methodology,
- prohibit inclusion of gender affirming care as an essential health benefit
MEDICAID
CMS is prioritizing 1115 waiver budget neutrality policy and oversight, and monitoring and evaluation of demonstration financial and programmatic outcomes. The agency has updated its approach to budget neutrality formulation and is providing technical assistance to states as well as conducting reviews of states’ reported demonstration expenditures.
CMS will also try to ensure proper billing and rate reimbursement in the Home and Community Based Services (HCBS) waiver and state plan programs, including rate setting and financial reporting for PACE. The focus will be on ensuring compliance, providing technical assistance, and fraud and abuse in the delivery of personal care and other HCBS services.
Through the proposed rule called “Preserving Medicaid Funding for Vulnerable Populations – Closing a Health Care-Related Tax Loophole,” CMS is proposing to update the legal requirements in State proposals for Medicaid tax waivers to ensure that proposals using what the administration calls an algorithmic loophole are not approvable. The focus of this proposed rule is on taxes on managed care organizations.
The budget recommends shifting the 340B Drug Pricing Program to CMS to allow for “streamlined processes and the ability to utilize inhouse drug-pricing resources and expertise.”
CMS PERFORMANCE MEASURES
CMS indicates the agency will develop new performance measures that support the MAHA initiative. The status of current CMS performance measures can be found on electronic pages 144-166 of this document. CMS is discontinuing several measures (see electronic pages 167ff), including:
- ensure beneficiary telephone customer service
- increase Marketplace enrollment nationwide
- increase Federally facilitated Marketplace enrollment among underrepresented populations
- increase the national rate of low-income children and adolescents, who are enrolled in Medicaid and Medicaid expansion Children’s Health Insurance Programs (CHIP), who receive any preventive dental service
- increase the proportion of providers performing initial enrollment in the Medicare Program online
- reduce the infection control survey deficiencies (of F880) for nursing homes that have received a Targeted Response Quality Improvement Initiative (TR-QII)
- reduce Healthcare Associated Infections [HAIs] in Critical Access Hospitals (CAH)
- maintain or exceed percent of beneficiaries in Medicare fee-for-service who report access to care
- maintain or exceed percent of beneficiaries in Medicare Advantage (MA) who report access to care
- reduce the average out-of-pocket share of prescription drug costs while in the Medicare Part D coverage gap
- percentage of CMMI model awardees participating in learning activities
- percentage of Original Medicare beneficiaries in an accountable care relationship
FDA AND PCORI
The budget decreases FDA’s discretionary request by 11.4 percent from FY25 due to focusing the agency on its core functions, reducing its physical footprint, and reducing the number of full-time employees by 1,940. The agency proposes MAHA activities to address chronic disease, restore trust in the food system and strengthen the country’s nutritional and food safety. The budget increases by 4 percent the medical device user fee program to review new medical devices.
The budget proposes to eliminate the Patient-Centered Outcomes Research Institute (PCORI). Established under the ACA, PCORI funds patient-centered comparative clinical effectiveness research.

Congress returns to Washington following weekend storms in the D.C. area. The forecast this week calls for potentially clearer skies and a busy week for both Congress and the White House. With that, let’s get into it. Welcome to the Week Ahead!
The Administration
Nearly a month after releasing its FY 26 skinny budget, the Department of Health and Human Services (HHS) has released its FY 26 Budget in Brief, which outlines a massive reorganization and shuttering of existing agencies to align with the administration’s “Make America Healthy Again” agenda.
As hard as issuing a budget request is, the real work is just beginning. Sec. Kennedy will now need to defend the full budget request against attacks from critics who argue that the reorganization is nothing more than a cut in disguise. Along with explaining the potentially bogus science in the recently published MAHA Report and plans to start publishing scientific research in-house, Sec. Kennedy has his work cut out for him.
The Senate
Senate Republicans return to Washington with only 13 legislative days to pass their version of the “One Big Beautiful Bill Act” before the self-imposed July 4 deadline. However, there are a lot of questions about how the Senate will move forward and what changes might be made to the bill. Some questions include:
- What will the Byrd Bath look like? The House-passed bill includes several provisions that may not pass the Senate’s Byrd Rule, which prohibits the inclusion of provisions unrelated to the federal budget. This could kill House provisions such as a moratorium on state regulations on artificial intelligence, a ban on courts enforcing certain injunctions, and language defunding Planned Parenthood.
- Will the Senate make changes to address concerns from fiscal hawks? The House bill would increase the debt limit by $4 trillion and extend borrowing authority beyond the 2026 midterms. That’s enough for Sen. Rand Paul (R-KY) to reject the bill. Additionally, Sen. Ron Johnson (R-WI) has called for more cuts if he is to support the bill. Other fiscal hawks may balk at the recent Congressional Budget Office estimate that the House bill’s tax changes would increase the deficit by $3.8 trillion.
- Will the Senate bump back Medicaid work requirements? To appease House Freedom Caucus members, the implementation date for Medicaid work requirements was moved forward from 2029 to 2026. However, concerns have been raised by some, including Sen. Lisa Murkowski (R-AK), that it will be challenging for some states, including hers, to meet the new timetable.
- Will the Senate remove Medicaid copays? Sen. Josh Hawley (R-MO) has criticized the House bill’s Medicaid copay provision as a “hidden tax on working poor people trying to get health care.” Other Republicans who supported Democratic amendments to protect Medicaid, like Murkowski and Sen. Susan Collins (R-ME), may share his concerns.
- Will the Senate change the Medicaid provider tax provision? The House bill prohibits states from putting in place new provider taxes and freezes existing provider taxes at current rates. However, some Republicans, such as Sen. Hawley, have expressed concerns about how that provision of the House bill will impact their states.
- Will we see committee markups? Initially, it sounded like the Senate might skip the committee process altogether. However, more recently, our intelligence from the Hill suggests committees such as the Senate Finance Committee might want to mark up the Senate bill. That opens the door for more proposed changes to the bill and slows things down for Republicans looking to get this bill passed.
- Will the SALT deduction be touched? House Republicans from high-tax states fought hard to increase the cap on how much their constituents can deduct from federal income taxes. Senate Republicans don’t have the same incentive to defend this provision, given that they generally represent lower-tax states.
Senate Health Care Hearings
- June 4: Senate HELP hearing on reauthorization of the over-the-counter monograph drug user fee program
The House
The House Appropriations Committee is kicking off the markup process for FY 26. First up are subcommittee markups for the funding bills for the Department of Veterans Affairs and the Food and Drug Administration on June 5.
Members of the House Appropriations Ag and FDA subcommittee won’t have much time to review the recently released FDA budget request before its June 5 markup. FDA highlights include:
- $3.2B in discretionary budget authority (11.4% decrease from FY 25). FDA justifies this by:
- Consolidating work to focus on core functions
- Reducing the number of full-time equivalents by 1,940
- $3.6B in user fees (4% increase over FY 25)
- $234.6M to support MAHA efforts related to chronic disease and food.
If the past is any gauge, we expect Republican members of the subcommittee to praise FDA’s efforts to address chronic disease rates by improving food quality and safety, and Democratic members to criticize planned reductions in force and funding cuts as a threat to public health.
Other House Health Care Hearings
- June 3: House Rules Committee meeting to consider the SUPPORT for Patients and Communities Reauthorization Act
- June 5: House Appropriations Interior and Environment Subcommittee hearing on FY 26 Indian Health Service Budget Request
There You Have It
It’s graduation season, so we wanted to take a moment to say congratulations to the class of 2025. Make it a great week!

Launching a coalition is an exciting step toward advancing meaningful policy change—but the real work begins once the group comes together. Coalitions require more than shared goals; they demand structure, coordination, and compromise. To be effective, coalition members must align on principles, stay organized, and understand how to best support one another’s strengths. This post explores the essential elements of building and managing a successful policy coalition—from setting ground rules to driving actionable outcomes.
Building and Managing a Successful Policy Coalition
Forming a coalition is a powerful way to advance a policy agenda—but success depends on how well the coalition is organized, aligned, and activated. From setting shared principles to leveraging individual strengths, a well-run coalition can be greater than the sum of its parts. Below are key strategies for building and managing an effective coalition.
Establish Policy Agreement and Ground Rules
The foundation of any successful coalition is mutual agreement on core policy principles. At the outset, it is essential that all members buy into a simple but important tenet: you must give a little to get a lot. Coalitions often falter when partners overreach or become too rigid in their demands. Instead, focus on defining key policy goals and the parameters the group will work within. Building consensus early on helps avoid unnecessary conflict later and ensures the group can speak with one voice.
Prioritize Strong Administration
Good ideas will not go far without strong organization. Set a consistent cadence for meetings—whether weekly, biweekly, or monthly—to maintain momentum. Make sure to capture and distribute meeting notes to help refresh ideas, keep members accountable, and track progress over time. This structure allows members to stay focused and productive between meetings and ensures the group continues to move forward.
Leverage the Strengths of Your Partners
Each coalition partner brings something unique to the table. One group might have expertise in policy analysis and drafting, while another excels at grassroots organizing, digital advocacy, or legislative outreach. Understanding your partners’ strengths allows you to delegate effectively and play to each member’s comparative advantage. This not only builds trust but also maximizes the coalition’s collective impact.
Define Action Items and Next Steps Clearly
Before each meeting, have a clear idea of what outcomes you’re aiming to achieve. If you’re hoping for agreement on a particular action item, guide the discussion strategically toward that goal. Anticipate possible objections and be prepared to adjust the conversation without losing sight of your objective. At the end of each meeting, assign responsibilities and clarify next steps to keep the coalition on track and moving toward its shared policy goals.
Chamber Hill Strategies
When it comes to coalition building, Chamber Hill Strategies stands out among lobbying firms in DC. Our comprehensive approach helps clients achieve their advocacy goals. With strong relationships on Capitol Hill and a track record of shaping health policy, we turn complex challenges into real-world wins.
Let our expertise in Washington, DC guide your efforts towards successful and meaningful stakeholder engagement. Look for our next blog about successfully identifying the right partners.
On May 20, 2025, the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies held a hearing on the FY26 budget request for the Department of Health and Human Services (HHS). Much like Sec. Kennedy’s appearances before the House Labor-HHS and Senate Health, Education, Labor, and Pensions Committees on May 14, members asked questions about the proposed HHS reorganization, Medicaid, and rural health care. Also, like in the prior hearings, many Republican members praised Kennedy’s “Make America Health Again” (MAHA) agenda. Democrats criticized Sec. Kennedy for reducing HHS’s workforce, expressed concerns about proposed funding cuts in FY 26, and argued that Republicans were trying to cut Medicaid benefits under the reconciliation bill.
OPENING STATEMENTS
WITNESS TESTIMONY
MEMBER DISCUSSION
HHS Reorganization and Withholding Funds
As was the case with previous hearings on the FY 26 budget request, much of the focus was on HHS’s reorganization and concerns about the withholding of funds. Appropriations Committee Chair Susan Collins (R-ME) asked about the impact of the reorganization on funding for the Centers for Disease Control and Prevention’s (CDC) brain injury program. Sec. Kennedy explained that his attorneys instructed him not to comment on that matter due to ongoing legal action against the administration’s actions. Subcommittee Chair Shelly Moore Capito (R-WV) asked about the impact of the reorganization on clinical trials. Sec. Kennedy assured her that the trials were not being cut. Subcommittee Ranking Member Tammy Baldwin (D-WI) expressed concerns about specific HHS funding that had been appropriated but not yet distributed. Sen. John Kennedy (R-LA) defended the reorganization by pointing out that large companies, such as Microsoft and Meta, have continued to function after undergoing restructuring and layoffs.
FY 26 HHS Budget Request Details
Subcommittee Ranking Member Baldwin and Sen. Patty Murray (D-WA) pressed for more specifics about the President’s FY 26 HHS budget request. Specifically, Ranking Member Baldwin asked when she could expect a detailed plan for the 530 programs that currently lack designated funding amounts in the proposed budget. Sec. Kennedy replied that those decisions are being made by the Office of Management and Budget (OMB) and framed the issue as a government-wide matter rather than an HHS-specific one. Ranking Member Baldwin also raised alarm over withheld funds to the National Institutes of Health (NIH) research, particularly in immunotherapy, citing a $3 billion drop in awarded funding and a decrease in grants. She asked who was responsible for holding the grants. Sec. Kennedy responded by saying that gene therapy is a priority. When Sen. Baldwin asked if the Department of Government Efficiency (DOGE) was reviewing the cuts, he reiterated a focus on cutting waste and fraud. Sen. Patty Murray (D-WA) questioned whether HHS was required to submit an operating plan outlining how every program would be run, including funding levels. She requested a comprehensive version, citing the need to understand which programs would be cut and how taxpayer dollars were being allocated.
Medicaid
Sens. Jack Reed (D-RI) and Jeff Merkley (D-OR) raised concerns about proposed Medicaid changes in the reconciliation legislation, stating that the proposed changes would lead to millions of people losing health coverage. These Senators inquired about the rationale behind these cuts. Sec. Kennedy responded with the same arguments he made last week that the reductions were not outright cuts but rather decreases in the rate of program growth. He emphasized that the changes were intended to eliminate waste, fraud, and abuse, claiming that people are stealing from the Medicaid program. He further argued that able-bodied men who refuse to work are contributing to the strain on the program.
Rural Health Care
Subcommittee Chair Capito raised concerns about how the administration’s proposed budget cuts could impact rural health care programs, asking Sec. Kennedy how his reorganization plan would improve conditions in rural America. Kennedy acknowledged that rural health is one of the most frequently raised issues. He noted that many rural hospitals are closing and emphasized their importance as economic drivers in their communities. He mentioned ongoing discussions with leading health technology companies to help address the issue.
Sen. John Boozman (R-AR) highlighted that cancer remains a leading cause of death and pointed out the lack of designated cancer centers in rural areas. He asked how HHS could improve patient outcomes and better support rural regions. Kennedy agreed that access to cancer treatments is necessary and acknowledged the challenges. Sen. Boozman further emphasized that rural counties face serious barriers, with many providers struggling to keep their doors open. He referenced the upcoming Farm bill and asked how to help build strong health infrastructure in those communities. Sec. Kennedy pointed to several programs under the Health Resources and Services Administration (HRSA), including the 340B drug pricing program. He recognized its significance to hospitals and rural health efforts and added that a revolution in AI could bring significant advancements. This is the second time that Sec. Kennedy has expressed his understanding that the 340B program is important to rural hospitals.
Sen. Brian Schatz (D-HI) brought attention to the fact that rural Americans are less likely to receive preventive health care. He questioned whether the administration’s stance on Diversity, Equity, and Inclusion (DEI) would limit the ability to understand how different populations respond to different types of care. Kennedy replied that this was not a DEI issue, citing he is working with Sen. Tim Scott (R-SC) on the delivery of a new sickle cell treatment to all who suffer from the disease in South Carolina as an example of an effort to ensure equitable care.
OTHER TOPICS
- Sen. Jerry Moran (R-KS) raised concerns about the measles outbreak in Kansas and the need for support for individuals with mental health disabilities. He also expressed his support for the BOLD Act.
- Sen. Jeanne Shaheen (D-NH) asked for a commitment to preserving the state opioid grant program, emphasizing its importance. She was assured it remains a priority, though past efforts to address the opioid crisis were acknowledged as insufficient.
- Committee Chair Collins asked if there would be support to restore the Leadership Education in Adolescent Health (LEAH) program and aid for low-income families.
- Sen. Kennedy questioned why processed foods were allowed to be sold in America. Sec. Kennedy responded that the food industry profits on poisoning children.