Insights^

On June 24, 2025, the House Energy and Commerce Health Subcommittee held a hearing on the FY 26 Department of Health and Human Services (HHS) budget. Republicans praised Sec. Kennedy’s reorganization of HHS and the Make America Healthy Again (MAHA) Commission, while Democrats expressed concerns about Medicaid savings and the status of Medicare drug pricing negotiations. Unlike Sec. Kennedy’s prior appearances, this hearing centered on a different set of issues.

OPENING STATEMENTS

• Health Subcommittee Chairman Buddy Carter (R-GA)
• Full Committee Ranking Member Frank Pallone (D-NJ)

WITNESS TESTIMONY

• HHS Sec. Robert F. Kennedy Jr.

MEMBER DISCUSSION

HHS Reorganizaton

Chairman Buddy Carter (R-GA) opened the discussion by expressing serious concern about the national debt, calling it “one of the greatest threats” to the country’s future. He questioned how the HHS reorganization would lead to measurable efficiencies for patients and providers.

In response, HHS Sec. Robert F. Kennedy Jr. framed the reorganization as a necessary modernization effort aimed at eliminating long-standing bureaucratic waste, fraud, and abuse. He also noted that the department’s restructured framework is designed to shift HHS from a reactive posture to a more proactive, prevention-focused health model. Sec. Kennedy also argued that despite spending $1.5 trillion each year on chronic disease, America has the highest chronic disease burden in the world. He placed a large share of the blame for that on fragmented care delivery and outdated infrastructure within HHS.

Rep. Brett Guthrie (R-KY) followed up by inquiring about the status of the department’s broader workforce reduction efforts, asking whether Sec. Kennedy could provide more information about potential staffing changes or consolidations. Sec. Kennedy responded that the reduction in force is currently under litigation and declined to elaborate further. Rep. Guthrie also raised questions about whether the reorganization would prompt CMS to revisit or modify innovation and technology policies established under the Biden administration. Kennedy replied that HHS is doing more than any other cabinet agency to integrate AI into the health care system, emphasizing the department’s commitment to using emerging technologies to modernize care delivery.

Democratic members such as Rep. Lori Trahan (D-MA) expressed skepticism that the reorganization would protect essential programs and services, warning that hospitals could be forced to cut services or close if Medicaid coverage is reduced or workforce pipelines are disrupted. She pointed to potential impacts on programs that train pediatricians, claiming that the Secretary’s budget “slashes Medicaid” and undermines the health workforce. Kennedy pushed back on these and similar arguments, asserting that the budget does not cut Medicaid and insisting that coverage levels would not be reduced under the new structure.

Drug Pricing

Rep. Debbie Dingell (D-MI) led a robust line of questioning focused on HHS’s ability and commitment to deliver on the Inflation Reduction Act’s (IRA’s)Medicare negotiation program. She pressed Sec. Kennedy on whether he would uphold the law’s drug negotiation provisions and resist any proposed rollbacks. Kennedy stated that he is committed to maintaining the IRA’s mechanisms for lowering prices. Rep. Dingell also sought clarity on the Department’s progress toward implementing negotiated drug prices by November 1, 2025, which she argued would allow seniors to see the benefits reflected in their out-ofpocket costs by January 2027. Kennedy confirmed that HHS is on track to meet that timeline. He further explained that HHS is currently negotiating with manufacturers to implement a Most Favored Nation (MFN) model—an international pricing benchmark that bases what prescription drug costs on what is charged in other Organization for Economic Co-operation and Development (OECD) countries, particularly in Europe. When asked how drug manufacturers are being brought into the negotiation process, Kennedy acknowledged the complexity of the effort and stressed that bipartisan cooperation is essential.

Reps. Gus Bilirakis (R-FL) and Dan Crenshaw (R-TX) also expressed strong support for lowering drug costs but brought the conversation into the realm of rare and pediatric diseases. For example, Rep. Bilirakis praised the Food and Drug Administration’s (FDA’s) Rare Pediatric Disease Priority Review Voucher (PRV) program. Rep. Bilirakis asked whether Sec. Kennedy would support preserving this incentive in the President’s budget and commit to ensuring the continuation of the program. Kennedy responded affirmatively, stating that it is a departmental priority and acknowledging that the budget includes provisions to maintain and improve regulatory pathways for these treatments. Rep. Bilirakis further raised the idea of a national priority voucher program to expand incentives for drug development in other high-need areas. Kennedy responded that the department is using the current programs extensively but continues to face regulatory and bureaucratic challenges—describing a “clash with red tape” that limits the approval pipeline for new therapies. He emphasized the need for additional flexibility and support to reduce delays and increase innovation. Rep. Crenshaw also mentioned that the House provision related to Orphan CURES Act was passed out of the House but needs Senate support.

Energy and Commerce Ranking Member Frank Pallone (D-NJ) warned that the Department’s recent actions could lead to preventable deaths if drug access and affordability are not improved. He demanded a written, substantive response from HHS to outstanding letters from lawmakers by August 1, to which Kennedy said they only respond as fast as they can.

Finally, Rep. Diana Harshbarger (R-TN) asked if the President’s budget includes any efforts to address concerns about pharmacy benefit managers (PBMs). Sec. Kennedy responded that PBM reform is currently under negotiation and again pointed to the MFN approach as a broader strategy to address systemic price distortions.

National Institutes of Health (NIH)

Rep. Nanette Barragán (D-CA) turned the conversation toward the NIH’s role in Alzheimer’s and dementia research. She began by affirming the importance of Alzheimer’s research and accused Kennedy of proposing cuts to the agency responsible for advancing this area of science. She specifically asked whether he was familiar with Alzheimer’s Disease Research Centers, key NIH-funded programs located across the country that serve as hubs for basic and translational neuroscience. Kennedy appeared unfamiliar with the centers and denied that any cuts to Alzheimer’s research were being proposed. His lack of awareness about a flagship NIH program drew concern and raised questions about whether research priorities are being sufficiently safeguarded within the HHS budget proposal.

OTHER TOPICS

• Reps. Kat Cammack (R-FL) and Greg Landsman (D-OH) raised concerns about maternal health deserts and requested coordination on efforts like the Save Infant Health Program; Sec. Kennedy expressed willingness to collaborate.
• Rep. Robin Kelly (D-IL) questioned HHS’s recommendation against COVID-19 vaccination for pregnant women and children, but Sec. Kennedy denied claims of coercion or unsupported guidance.
• Rep. Landsman (D-OH) emphasized restoring funding to improve birth outcomes and reduce disparities; Kennedy agreed to work with him.
• Rep. John James (R-MI) asked how HHS is addressing large corporations abusing government programs; Kennedy stressed the need to realign incentives, including improvements to food in military and school programs.

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.

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

• Subcommittee Chair Shelly Capito (R-WV)

WITNESS TESTIMONY

•  Sec. Robert Kennedy Jr. 

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.

On May 14, Secretary of Health and Human Services (HHS) Robert F. Kennedy Jr. testified before the House Appropriations Labor-HHS Subcommittee and the Senate Committee on Health, Education, Labor, and Pensions (HELP) about the fiscal year 2026 (FY 26) HHS budget request. These are the first hearings for the FY 26 HHS budget request. Sec. Kennedy used these hearings to outline how the budget request aims to help HHS meet its goals of reducing the high rates of chronic disease and delivering services to Americans in the most efficient way possible. Republicans generally applauded the Secretary for focusing on trying to reduce the high rates of chronic disease and on making HHS more efficient. Democrats expressed concerns about the impact of reductions in force at HHS, the impounding or freezing of already appropriated congressional funds, and the proposed cuts and reorganization within HHS outlined in the FY 26 skinny budget request. Democrats also used the hearings to argue that Republicans plan to gut Medicaid through the reconciliation legislation currently being considered in the House of Representatives, a claim that Republicans denied.

WITNESS TESTIMONY

During his testimony in both hearings, Sec. Kennedy outlined several priorities in the FY 26 budget:

• Consolidating mental health programs to make them more efficient in addressing rising rates of mental health illnesses and substance use disorders.
• Address priorities related to nutrition, exercise, and physical activity (through $94B request, including for the Administration for a Healthy America (AHA)
• Expand food safety efforts at the Food and Drug Administration (FDA)
• Funding research that is innovative, while cutting research that he said is dangerous, and research based on diversity, equity, and inclusion.
• Promoting the use of new health technologies to manage data, including AI.
• Restoring trust in public health agencies.

OPENING STATEMENTS

• House Appropriations Labor-HHS Subcommittee Chair Robert Aderholt (R-AL) 
• House Appropriations Labor-HHS Subcommittee Ranking Member Rosa DeLauro (D-CT)
• Senate HELP Chair Bill Cassidy (R-LA)

MEMBER QUESTIONS AND DISCUSSION

Allocation of Appropriated Funding and HHS Workforce Reductions

In the House hearing, Democratic representatives used much of their time to argue that the Trump administration has illegally frozen congressionally appropriated funding, including at HHS. Subcommittee Ranking Member DeLauro (D-CT) and other Democratic Representatives pressed Sec. Kennedy on this and asked if he views congressionally directed appropriations as suggestions or the law. In answer to these questions, Sec. Kennedy stated that HHS follows the law and added that if Congress appropriates funds to HHS, he will spend them. Democratic members were skeptical of Sec. Kennedy’s answers. In response to questions on this topic, Subcommittee Chair Aderholdt (R-AL) reminded members to focus on the FY 26 request.

In both the House and Senate hearings, Democratic representatives also asked for information regarding decisions to reduce the HHS workforce. In response to questions from Rep. Steny Hoyer (D-MD) and Sen. Tim Kaine (D-VA) about whether Sec. Kennedy or Elon Musk made these decisions, Sec. Kennedy said he and his staff had the final say and that Musk only provided guidance. When asked by Rep. Lois Frankel (DFL) if he had conversations with members of Congress about these decisions, Sec. Kennedy mentioned talking with Sen. Bill Cassidy (R-LA), but did not name any Representatives.

Chronic Disease

In the House hearing, Republican and Democratic representatives expressed support for addressing chronic health issues by improving nutrition and promoting physical activity. However, while Republicans mostly praised the Trump administration for what it has done so far in this area, Democratic representatives argued that the FY 26 budget request will make it harder to address chronic health issues. Representatives such as Rep. Madeline Dean (D-PA) and Rep. Watson Coleman (D-NJ) expressed concerns about proposed cuts at the Substance Abuse and Mental Health Administration and the Office of Minority Health. Sec. Kennedy expressed his view that these were not cuts, but rather about restructuring HHS to eliminate redundant programs. Democratic members rejected this answer.

In the Senate hearing, Sen. Jon Husted (R-OH) expressed satisfaction with the progress of the Make America Healthy Again (MAHA) movement and inquired about specific measures being taken. In response, Secretary Kennedy highlighted efforts to promote healthy foods through the Supplemental Nutrition Assistance Program (SNAP). Sen. Tim Scott (R-SC) expressed support for eliminating artificial dyes in food.

Medicaid

Democratic representatives and senators also took the opportunity to argue that the reconciliation legislation moving through the House of Representatives will cut Medicaid and lead to reductions in health care coverage and worse health outcomes. Rep. Josh Harder (D-CA) said that these cuts would hurt vulnerable Americans and slammed Medicaid work requirements as being overburdensome. Senate HELP Ranking Member Bernie Sanders (I-VT) said the reconciliation legislation was making these cuts to Medicaid to pay for tax cuts for the rich. Sec. Kennedy and Rep. Andy Harris (R-MD) argued that these cuts were focused on cutting waste, fraud, and abuse within the program and ensuring Medicaid does not provide coverage for illegal immigrants or non-disabled adults who are not working.

Vaccines

Many Democratic members in both the House and Senate hearings expressed concern about the ongoing measles outbreak in Texas. Sen. Patty Murphy (D-WA) questioned Sec. Kennedy about new standards for vaccine approvals and asked him to clarify remarks made in the House about vaccination, specifically whether he recommends the measles vaccine. Kennedy responded by stating that he would tell the truth, acknowledged concerns about vaccines, and claimed that people have been misled. When Sen. Roger Marshall (R-KS) asked where his vaccine recommendations come from, Kennedy said they are based on many different sources.

In response to Sen. Maggie Hassan (D-NH), he ultimately affirmed that the measles vaccine is the most effective way to prevent the spread of the disease.

OTHER TOPICS

• Reps. Andrew Clyde (R-GA) and Jake Ellzey (R-TX) expressed concerns about the whereabouts of unaccompanied immigrant children, arguing that HHS under the Biden administration failed to provide proper oversight. Sec. Kennedy said he was committed to finding these children. Rep. DeLauro (D-CT) countered that if Republicans are so concerned about this, they should start with the children who, she stated, were still missing after actions during President Trump’s term related to family separation.
• Rep. John Moolenaar (R-MI) and Sen. Jim Banks (R-IN) expressed concerns about overreliance on Chinese biotech and pharmaceutical supply chains. Sec. Kennedy agreed with these concerns.
• Rep. Chuck Fleischmann (R-TN) expressed his support for the 340B program and asked about plans to transfer the program’s oversight to the Centers for Medicare and Medicaid Services (CMS).
• Sen. Josh Hawley (R-AR) expressed opposition to pharmaceutical advertising and alluded to legislation on this topic that he is introducing.
• Reps. Aderholt (R-AL) and Julia Letlow (R-LA) expressed concerns about rural healthcare, with Rep. Aderholt (R-AL) focusing on the wage index for low-volume hospitals and Rep. Letlow (R-LA) highlighting the issue of rural health deserts. Sec. Kennedy expressed support for taking action to support rural health providers.
• Rep. Pocan (D-WI) asked Sec. Kennedy if he was committed to addressing overpayments to Medicare Advantage (MA) plans. Sec. Kennedy said he was but also expressed general support for the MA program.
• Senate HELP Committee Chair Bill Cassidy (R-LA) expressed concerns about closing the Office of Long COVID Research and reducing funding to address the prevalence of neurological diseases.

Starting on May 13, 2025, the House Energy & Commerce Committee held a markup of the Committee’s budget reconciliation committee print, which will be added to work of other committees to produce a larger budget reconciliation bill for consideration by the full House at a later date. While health policy has received much of the attention, the instructions to the Committee under the budget resolution are not confined only to health policy, and the Committee print included 4 subtitles covering energy, environment, communications, and health. Following debate on the separate titles and the consideration of amendments, the Committee approved the subtitles in party line votes, sending the committee print to the House Committee on the Budget to be incorporated with legislation from other House committees into a larger legislative package.

OPENING STATEMENTS

Before moving to the formal debate of the legislation before the Committee, several members offered opening statements. Chairman Brett Guthrie (R-KY) and Ranking Member Frank Pallone (D-NJ) began the May 13 markup with opening statements. Health Subcommittee Ranking Member Diana DeGette (D-CO) and numerous members of the Committee also made opening statements, with members on both sides of the aisle sharing personal stories of Medicaid enrollees. Committee Democrats highlighted individuals in their home states concerned about losing Medicaid coverage should the budget reconciliation legislation move forward and be signed into law. Republican statements focused on stressing that Medicaid is unsustainable as a program and that the legislation will help preserve Medicaid by addressing waste, fraud, and abuse in the program, implementing a work requirement for able-bodied Medicaid enrollees, ending Medicaid coverage for immigrants without legal status, and forbidding Medicaid coverage of transgender surgeries for minors. Democratic statements focused on estimates from Congressional Budget Office (CBO) communications that more 13 million individuals could potentially lose coverage and connected the reductions in Medicaid to Republican efforts to extend tax cuts for wealthier Americans. Not surprisingly, Republicans and Democrats disagreed about the veracity of the numbers of individuals who could lose coverage. Regarding the work requirement, Chairman Guthrie outlined specific exceptions to the work requirement to address many concerns that have been raised, while Democrats raised the objection that the work requirement would cause eligible individuals to lose coverage.

HEALTH SUBTITLE AND AMENDMENTS

For consideration of the health subtitle, Chairman Guthrie offered an amendment of the nature of a substitute to serve as the base text for consideration. During their comments, Committee Democrats continued to highlight the stories of Medicaid enrollees and the more than 13 million estimated to lose coverage in CBO communications. Following comments from multiple members regarding the health subtitle, the Committee moved to consideration of amendments.

During the debate, the Committee considered 20 separate amendments on a range of provisions and issues.

Each amendment offered was defeated on a party-line vote. Among the amendments of note and interest include the following:

• Health Subcommittee Ranking Member Rep. Diana DeGette (D-CO) offered the first amendment, which would prevent the provisions of the health subtitle from taking effect until the Secretary of Health & Human Services certifies that the legislation would not reduce benefits under state plans.
• Rep. Marc Veasey (D-TX) offered an amendment to strike the provisions setting limits on new provider taxes. Often criticized as a gimmick or loophole for states to access additional federal dollars, arguments for the amendment centered on the value to states in utilizing provider taxes to generate funding for their Medicaid programs and provide additional funds back to states.
• Rep. Kathy Castor (D-FL) offered an amendment to remove the legislation’s limits on state directed payments, which would allow existing state directed payment systems in place to continue but would cap the level of future state directed payments at Medicare levels.
• Rep. Raul Ruiz, MD (D-CA) offered an amendment requiring states to submit a report assessing the effects of the bill on rates of uncompensated care and on emergency department wait times.
• Rep. Scott Peters (D-CA) offered an amendment to strike the work and community engagement requirement for the Medicaid expansion population. Supporters of the amendment cited concerns about the administrative burden that would be imposed under the requirement, and supporters also cited past experiences in Arkansas and Georgia to demonstrate that the requirement could lead to eligible individuals losing coverage. Chairman Guthrie responded noting that the provisions were created with exceptions and provisions to help address and prevent situations like those that occurred under Arkansas and Georgia’s work requirements.
• Rep. Robin Kelly (D-IL) introduced an amendment requiring state audits of individuals who lost coverage under the legislation’s community engagement or work requirement but would otherwise have qualified for coverage under the requirement’s exceptions.
• Rep. Greg Landsman (D-OH) offered an amendment to strike the provision allowing states to assess cost-sharing of up to $35 per service on Medicaid expansion adults with incomes over 100 percent of the federal poverty level (FPL). Supporters of the amendment argued that this will lead to large numbers of enrollees forgoing care, further driving up costs of uncompensated care. Chairman Guthrie and other Republican committee members pointed out requiring enrollee “skin the game” is important and required in other health plans and that states have flexibility to impose much lower cost-sharing much lower than $35.
• Rep. Nanette Diaz Barragan (D-CA) offered an amendment to strike the provision limiting retroactive coverage under Medicaid and CHIP to one month prior to an individual’s application date, which would be a reduction from current law which allows for 3 months of retroactive coverage. Committee Democrats argued that this will reduce healthcare coverage for children and families that earn too much to qualify for Medicaid but not enough to afford coverage under the health insurance exchange under the Affordable Care Act (ACA).
• Rep. Debbie Dingell (D-MI) offered an amendment stating a sense of Congress supporting most favored nation pricing for prescription drugs. Supporters noted President Trump’s recent executive order to lower U.S. drug costs by linking prices to those paid in other developed countries. Chairman Guthrie expressed agreement with the President on the need to address American drug pricing but pointed out that Americans also benefit from pharmaceutical innovation.
• Rep. Alexandria Ocasio-Cortez (D-NY) introduced an amendment which would include the provisions to address risk adjustment in Medicare Advantage along with modifying the update to Medicare physician payments to be consistent with the Medicare economic index (MEI) ,which is an annual measure of the inflationary rise in medical practice costs. Health Subcommittee Chair Buddy Carter (R-GA) offered supportive comments regarding the amendment but stated the reconciliation legislation was not the appropriate avenue for these provisions.
• Rep. Ocasio-Cortez (D-NY) offered an amendment that would effectively undo the legislation’s provisions rescinding the nursing home staffing rule that was finalized under the Biden administration.
• Rep. Dingell (D-MI) offered an amendment prohibiting states from imposing new limitations or payment reductions for home and community-based services (HCBS).

Following the consideration and dispensing of amendments, the Committee approved the health subtitle, as amended by Chairman Guthrie’s amendment in the nature of a substitute, on a party line vote.

COMPLETION OF CONSIDERATION AND NEXT STEPS

Following approval of the health subtitle, the full Energy & Commerce Committee voted 30-24 along party lines to report and transmit the legislation and its four subtitles, consistent with the instructions received under the budget resolution, to the House Committee on the Budget.

The House Budget Committee has announced plans to meet in a markup on Friday, May 16 to consider the legislative package that incorporates the E&C Committee’s work and the work of other House committees to be considered under the budget reconciliation process.

Assuming passage by the House Budget Committee, Speaker of the House Mike Johnson (RLA) and House Republican leadership continues to assert their plans to bring up the legislative package before the full House of Representatives for consideration and passage before Memorial Day.

The Senate has not announced plans for consideration, but it is speculated that the Senate will not meet in its respective committees to consider the legislative package. Rather, there is speculation that the full Senate will take up, amend, and pass the House-passed legislation in June.

Following Senate consideration and passage, the House and Senate will need to work to reconcile their respective differences in the weeks that follow in June and July.