The Latest in ASTCT Advocacy: January 2026

Congress Progress in FY2026 Funding Stalled

The 2026 Minibus, a bipartisan package to fund the U.S. Department of Health and Human Services (HHS) and five other federal agencies through September 30, 2026, enjoyed rare bipartisan, bicameral support until national unrest regarding the Trump administration’s immigration policies gave enough lawmakers pause. In addition to HHS funding, the 2026 Minibus funds the U.S. Department of Homeland Security (DHS), which covers FEMA, TSA and ICE operations.

Just last week, the Minibus sailed through the usually contentious House only to hit an impasse in the Senate due to concerns with recent ICE activity. On January 29, enough Republican Senators joined their Democratic colleagues in voting down the Minibus and called for the White House to negotiate on DHS reform.

While details are still emerging, it is likely that the White House will strike an agreement with concerned lawmakers to fund HHS, Defense, Labor, Education and Transportation and Housing—the other five agencies included in the Minibus—and provide short-term stopgap funding for DHS until lawmakers and the White House can come to an agreement on ICE parameters.

Congress has until January 30 to pass legislation to fund these agencies before the federal government enters a partial shutdown. The House, which does not reconvene until the first week of February, would need to approve any changes that the Senate makes to the Minibus, so a shutdown is almost inevitable at this point. After coming off of the longest government shutdown in history in November, lawmakers and the White House have no appetite for a second shutdown regarding 2026 funding.

FY2026 HHS Highlights

While lawmakers may make changes to the Minibus that affect DHS provisions, the HHS provisions will likely remain unchanged. Here’s a highlight of HHS funding for FY2026:

• Includes $116.6B in discretionary funds to HHS.
• Allocates $~49B—a $415 million increase over the 2025 levels—to NIH.
• Includes language that prevents the Trump administration from capping or restructuring funding for research overhead.
• Rejects the Trump administration’s $20B request to create a new agency called the Administration for a Health America.
• Limits, but does not prohibit, forward funding grants.
• Includes $4.6B in funding to community health centers.
• Delays cuts to disproportionate share hospitals through FY 2028.
• Includes S.932/H.R.1262, the Give Kids a Chance Act, which boosts research into pediatric uses of cancer drugs by reauthorizing and improving the Rare Pediatric Disease Priority Review Voucher Program.
• Includes S. 752/H.R. 1509, the Accelerating Kids Access to Care Act, which fast-tracks physician’s out-of-state Medicaid enrollment processes to help pediatric patients receive timely care.
• Expands most telehealth flexibilities through the end of 2027 and the hospital-at -home program through September 2030.
• Includes language that targets operational practices of pharmacy benefit managers to increase accountability and transparency and requires PBMs to pass through rebates to commercial plans to help cut drug costs.
• Provides a ~3.1 percent increase in Medicare payments to physicians participating in Advanced Alternative Payment Models.
• The proposed legislation does not include any extension to ACA premium subsidies

Next Steps

This bill in some form will eventually reach the President’s desk for signature. While the HHS funding provisions exclude many of the Executive Branch’s 2026 requests, the interest of keeping the government open may prompt the President to sign off on funding the government through September 30, 2026. Both the Legislative and Executive Branches have already begun to focus on the FY2027 budget, which needs to be signed into law by October 1, 2027. With mid-term campaign season in full force, there is even less interest in a government shutdown this fall.