U.S. Healthcare Budget Reconciliation Delayed Amid Medicaid, Medicare, and HHS Oversight Developments
The U.S. House of Representatives committees have postponed markups of the budget reconciliation package, now expected to occur next week at the earliest. House Republicans are debating the scope of healthcare policy changes, especially Medicaid, aiming to achieve $880 billion in savings.
The Trump Administration's FY 2026 "skinny budget" request, released on May 2, 2025, proposes a $33 billion cut in federal healthcare spending alongside a $163 billion reduction in nondefense discretionary funding. It also forecasts increased defense and border security funding. A Senate HELP Committee hearing with HHS Secretary Robert F. Kennedy Jr. is scheduled to discuss the fiscal year budget proposal.
Significant healthcare program reforms, including HHS reorganization, are part of the proposed budget. The House Energy and Commerce and Ways and Means Committees delayed their reconciliations markups amid internal GOP divisions, particularly over Medicaid work requirement proposals.
Democratic staff have criticized efforts to impose Medicaid work requirements, referencing prior legal challenges and state retractions. The COMPLETE Care Act, aimed at improving Medicare behavioral health payments and reporting, has been referred to the Senate Finance Committee, potentially becoming part of future healthcare legislation.
NIH and FDA recent initiatives aim to reduce animal testing in biomedical research through new offices and phased-out requirements. The HHS released a report on pediatric gender dysphoria treatments, highlighting limited evidence for gender-affirming care and suggesting mental health therapy alternatives.
This report sparked responses from medical associations and could influence future congressional actions on care access. The DOJ filed lawsuits against three health insurers and three brokers for allegedly steering Medicare Advantage beneficiaries through improper payments, spotlighting industry practices under congressional scrutiny.
These developments reflect ongoing regulatory, compliance, and legislative activities influencing U.S. healthcare programs, particularly Medicaid reforms and Medicare Advantage oversight.