THIS WEEK’S DOSE

• Senate Prepares to Take Up Reconciliation Bill. Discussions about the bill’s real-world implications continued during this week’s recess.
• HHS Removes COVID-19 Vaccine Recommendations for Healthy Children, Pregnant Women. US Department of Health and Human Services (HHS) Secretary Kennedy announced the change without input from the agency’s independent advisory panel.
• CMS Increases Oversight on States Providing Medicaid to Certain Immigrants. The Centers for Medicare & Medicaid Services (CMS) announced that it will take actions to ensure states are not using federal Medicaid funds to cover healthcare for ineligible individuals.
• President Trump Signs EO on Science Research. The executive order (EO) seeks to adopt new “gold standard” science principles.
• CMS Requests Information From Hospitals on Gender-Affirming Care. The letter seeks data on certain hospitals’ provision of gender-affirming care to minors.

CONGRESS

Senate Prepares to Take Up Reconciliation. When the Senate returns from the Memorial Day recess next week, it starts a busy four-week stretch leading up to the Independence Day recess. During this period, leaders intend to advance the budget reconciliation package, the One Big Beautiful Bill Act, H.R. 1. As Senate Republican leaders consider their intraparty political balancing act (they can only lose three votes for the bill to still advance), expect changes to the House-passed bill, which Speaker Johnson (R-LA) advanced through his chamber by a narrow 215 – 214 margin just before Memorial Day.

In an updated analysis of the estimated revenue effects of H.R.1’s tax provisions, the Joint Tax Committee found that, in total, the bill loses $3.94 trillion in revenue. On the healthcare front, the House Ways and Means Committee’s changes to the Affordable Care Act (ACA) are estimated to save more than $150 billion in revenue. We do not have the Congressional Budget Office’s (CBO’s) final estimate of the coverage loss associated with these policy changes, but its preliminary May 18, 2025, analysis estimated that 2.1 million people would become uninsured as a result of the House Ways and Means Committee’s changes. These policies also interact with ACA policies included by the House Energy and Commerce Committee, so we await the updated CBO analysis to get a more complete picture of the combined impact of the bill’s provisions.

As discussion about the bill’s impact on state budgets continues, 20 Republican governors sent a letter to President Trump in support of the One Big Beautiful Bill Act; notably, the Republican governors of Florida, Nevada, New Hampshire, Ohio, Oklahoma, South Dakota, and Vermont did not sign on.

ADMINISTRATION

HHS Removes COVID-19 Vaccine Recommendations for Healthy Children, Pregnant Women. In a video posted on X, HHS Secretary Kennedy, alongside US Food and Drug Administration (FDA) Commissioner Makary and National Institutes of Health (NIH) Director Bhattacharya, announced that the Centers for Disease Control and Prevention’s (CDC’s) vaccine recommendations will no longer include the COVID-19 vaccine for healthy children and pregnant women. Normally, the Advisory Committee on Immunization Practices (ACIP) provides vaccine recommendations, and the CDC director is responsible for adopting them. Only then do the recommendations become official CDC policy. CDC previously adopted ACIP’s recommendation that all Americans six months and older, including pregnant women, get at least one updated COVID-19 vaccine. Kennedy’s announcement comes before ACIP’s scheduled meeting in June to make recommendations about fall shots, meaning the decision was made without input from the independent advisory panel.

CMS Announces Plans to Increase Oversight on States Providing Medicaid to Certain Immigrants. In a letter to states, CMS Administrator Oz clarified that federal Medicaid funding is only available for limited Medicaid coverage necessary for treatment of an emergency medical condition for individuals who meet all Medicaid eligibility requirements but are not lawful permanent residents. He announced that, in an effort to ensure states do not use federal Medicaid funds to cover healthcare for ineligible individuals, CMS will undertake the following actions:

• Focused evaluations of select state Medicaid spending reports (CMS-64 form submissions).
• In-depth reviews of select states’ financial management systems.
• Assessment of existing eligibility rules and policies to close loopholes and strengthen enforcement.

CMS urges all states to immediately examine and update internal controls, eligibility systems, and cost allocation policies to ensure full compliance with federal law, and reminded states that any improper spending will be subject to recoupment of the federal share. Read the press release here.

President Trump Signs EO on Science Research. The EO, “Restoring Gold Standard Science,” directs:

• The Office of Science and Technology Policy (OSTP) to issue guidance to agencies within 30 days for adopting new “gold standard” science principles, including that science is reproducible, transparent, collaborative, and without conflicts of interest.
• Federal agencies to update their processes and report to OSTP within 60 days about implementation progress.
• Federal agencies to ensure that employees do not engage in scientific misconduct, to publicly report certain data, and to communicate uncertainty within 30 days.

The EO states that the Biden administration politicized science by encouraging agencies to incorporate diversity, equity, and inclusion. The EO reinstates scientific integrity policies from the first Trump administration, encouraging US research organizations to adopt these standards. Read the fact sheet here.

CMS Requests Information From Hospitals on Gender-Affirming Care. A letter to certain hospitals requested information about quality standards adherence and federal funding related to gender-affirming care procedures for minors. This letter follows previous actions from the Trump administration regarding gender-affirming care for minors and reiterates concerns about the long-term risks of such care previously communicated in an executive order, a report reviewing best practices for gender dysphoria treatment, and a quality and safety special alert memo for hospitals. The letter requests certain information within 30 days, including the following, and does not cite the authority for requesting such data:

• Information regarding informed consent protocols.
• Planned changes to clinical guidelines in response to the gender dysphoria report.
• Any adverse events in response to gender-affirming care.
• Billing codes used for specified procedures.
• Facility- and provider-level revenue, operating margins, and profit margins for each specified procedure.
• Projected revenue forecasts for each service line.

A list of hospitals that received the letter has not been released. Read the press release here.

QUICK HITS

• HRSA Revises CHGME Resident Count Methodology. The Health Resources and Services Administration (HRSA) finalized a previously proposed change to how Children’s Hospitals Graduate Medical Education (CHGME) full-time equivalent (FTE) residency slots are counted to align with the methodology CMS uses for the Medicare graduate medical education FTE resident cap.
• CMS Innovation Center Adjusts KCC Model. The updates to the Kidney Care Choices (KCC) Model adjust financial methodology and participation options beginning in performance year 2026. The center also extended the model through 2027.
• House Energy and Commerce Democrats Seek Answers on HHS Staffing Changes. The letter asked HHS Secretary Kennedy to answer questions sent in an April 2025 letter that have still not been answered, and posed additional questions about legal compliance, impacts of staff and grant terminations at FDA and NIH, and other issues. Read the press release here.

BIPARTISAN LEGISLATION SPOTLIGHT

NEXT WEEK’S DIAGNOSIS

Congress will be back in session next week, and the FY 2026 appropriations process will get underway in earnest as the House Appropriations Committee begins its markups (see full schedule here). The committee intends to finish marking up all 12 of its annual spending bills by July 24, 2025, with the Labor-HHS bill scheduled as the final markup. Meanwhile, as noted above, the Senate is turning its attention to reconciliation.We anticipate more details on the president’s FY 2026 budget request may be released to Congress shortly, though reports indicate that the full FY 2026 request may not be unveiled until after the reconciliation package is completed. Congressional Republicans will use the request as they move through the appropriations process. We also expect the Trump administration to send a recissions package to Congress next week that is anticipated to include about $9 billion in clawbacks of already-approved funding for the current fiscal year. The recission process is a formal way for Congress to fast track recommended cuts in spending by the administration. Congress will have 45 days to consider the recission package. Congress can choose to approve it, delete some provisions, or not consider it at all, but Congress does not have the opportunity to add new policies to a recissions package. We wait to see if health policies are included in the package.