Congress Faces Tight Deadline for FY 2026 Funding Amid Partisan Challenges

Congress has returned from its August recess with a critical deadline of September 30, 2025, to fund the government for fiscal year (FY) 2026. Both the House and Senate have a limited session schedule, with only 14 days before the funding deadline. The outcome remains uncertain as bipartisan agreement is necessary to pass appropriations, but partisan differences suggest a government shutdown is likely.

Prior to the recess, the Senate passed three appropriations bills, including one for the US Food and Drug Administration, with strong bipartisan support. However, bills passed by the Senate may face challenges in the House, and vice versa. Senate Minority Leader Chuck Schumer indicated willingness to collaborate on bipartisan legislation, but Republican opposition to bipartisan measures signals potential legislative gridlock.

Appropriations efforts continue in the House, where the Labor, Health and Human Services (HHS), Education, and Related Agencies Subcommittee is marking up its FY 2026 funding bill. Notably, the House bill proposes $108 billion for HHS, a $7 billion reduction from FY 2025 funding, contrasting with the Senate's proposed increase to $116 billion. Both funding levels exceed earlier Trump administration requests of $94.7 billion. The full House Appropriations Committee is expected to review the bill soon.

Additionally, the Senate Finance Committee will vote on key nominations within HHS and hear testimony from HHS Secretary Xavier Becerra outlining the president's 2026 healthcare agenda. The committee may also release the second "Make America Healthy Again" report focusing on children's chronic diseases. Separately, the Medicare Payment Advisory Commission will convene to discuss payment accuracy, oversight, hospice services, and the impact of Medicare Advantage enrollment on hospital finances.

The appropriations process and related committee actions are critical for the U.S. healthcare and insurance sectors, impacting regulatory compliance, funding priorities, and payment models. Healthcare organizations and insurers should monitor these developments closely due to their potential effect on policy, regulatory frameworks, and funding allocations in FY 2026.