Holland & Knight Health Dose: June 10, 2025

Looking Ahead: Additions to Reconciliation Package

The U.S. Senate will likely release additional sections of the reconciliation package this week. It is unlikely the Senate Committee on Finance, which has jurisdiction over Medicaid, will hold a markup on its portion of the legislation. Hearings in the Senate Committee on Appropriations will continue this week, with the National Institutes of Health (NIH) director expected to testify and defend the NIH budget request for fiscal year (FY) 2026.

In the U.S. House of Representatives, the Committee on Appropriations will continue holding subcommittee and full committee markups of bills to fund federal agencies, including the bill to fund the U.S. Food and Drug Administration (FDA). The bill was previously advanced by the Agriculture, Rural Development, and FDA subcommittee on a party-line vote. Also expected to be considered on the House floor is the Recissions Act of 2025 (H.R. 4), which would claw back previously appropriated funds for various federal agencies as identified by the Trump Administration and the Halt All Lethal Trafficking (HALT) of Fentanyl Act (S. 331), which would permanently classify fentanyl-related substances as Schedule I drugs under the Controlled Substances Act.

Hearings This Week

The Senate Appropriations Committee's Subcommittee on Labor, Health and Human Services, Education, and Related Agencies will hold a hearing at 10 a.m. on June 10, 2025, titled "A Review of the President's Fiscal Year 2026 Budget Request for the National Institutes of Health." NIH Director Dr. Jayanta Bhattacharya will testify.

The House Committee on Education and the Workforce Subcommittee on Early Childhood, Elementary, and Secondary Education will hold a hearing on June 10, 2025, titled "Screentime in Schools."

The House Committee on Oversight and Government Reform will hold a hearing on June 10, 2025, titled "Securing Americans' Genetic Information: Privacy and National Security Concerns Surrounding 23andMe's Bankruptcy Sale."

The Senate Committee on the Judiciary will hold a hearing at 10:15 a.m. on June 11, 2025, titled "23 and You: The Privacy and National Security Implications of the 23andMe Bankruptcy."

The House Appropriations Committee will hold a full committee markup at 10 a.m. on June 11, 2025, of the FY 2026 Agriculture, Rural Development, FDA, and Related Agencies Bill.

The House Committee on Energy and Commerce Subcommittee on Health will hold a hearing at 10 a.m. on June 11, 2025, titled "Strengthening Domestic Manufacturing and the Health Care Supply Chain."

Week in Review

The House passed the SUPPORT for Patients and Communities Reauthorization Act of 2025 (H.R. 2483) on June 4, 2025, by a vote of 366-57. "No" votes came from members of the House Freedom Caucus and Democrats on the House Committee on Energy and Commerce. James O'Neill was confirmed by the Senate on June 5, 2025, by a vote of 52-43 to be deputy secretary of the U.S. Department of Health and Human Services (HHS). Work continues in the Senate on the reconciliation package, which leadership intends to finalize and pass by July 4, 2025 – a tall order but not an impossible goal, should the Senate continue to release portions of the legislative text and meetings with committees of jurisdiction and the Senate parliamentarian progress.

Administrative Updates

Executive Order Updates

The Trump Administration has continued to release wide-ranging executive orders (EOs). For brief overviews of the numerous orders published by the Trump Administration, see our "Trump's 2025 Executive Orders: Updates and Summaries" tracking chart.

White House Memorandum for the HHS Secretary and CMS

President Donald Trump issued a memorandum from the White House to the HHS secretary and the Centers for Medicare & Medicaid Services (CMS) on June 6, 2025, titled "Eliminating Waste, Fraud, and Abuse in Medicaid." The memorandum details opposition to healthcare provider taxes used by some states to increase the funding states receive in the form of state-directed payments. The memorandum directs the HHS secretary to "take appropriate action to eliminate waste, fraud, and abuse in Medicaid, including by ensuring Medicaid payments are not higher than Medicare, to the extent permitted by applicable law." Given efforts by the HHS to limit the ability of states to tax certain healthcare providers through rulemaking, it is likely this memorandum will result in additional administrative guidance by the CMS and additional rulemaking to limit the state-directed payments program.

Personnel Updates

• Drew Snyder resigned as director of the CMS Center for Medicaid and CHIP Services (CMCS). Dr. Caprice Knapp will manage the center until a permanent replacement is named.
• Thomas Keane will be the Assistant Secretary for Technology Policy (ASTP) and National Coordinator for Health Information Technology.
• Alex Mugge, CMS' Chief Health Informatics Officer, is leaving June 12, 2025, to join an information technology (IT) giant.

Regulatory Updates

HHS Rescinds Guidance on Emergency Abortion Care Requirements for Hospitals

Following the U.S. Supreme Court's Dobbs v. Jackson Women's Health Organization decision, which overturned Roe v. Wade and allowed states to implement their own abortion laws, the Biden Administration issued guidance reaffirming that the Emergency Medical Treatment and Active Labor Act (EMTALA) requires hospitals to provide stabilizing care – including abortion – in emergency situations, even in states where abortion is otherwise banned. The Biden Administration asserted that EMTALA preempts conflicting state laws when a pregnant individual faces a medical emergency that threatens their life or health. This interpretation has become the subject of ongoing litigation, including in a case involving Idaho's abortion ban, which has been dropped under the Trump Administration.

In its statement, CMS emphasized that it "will continue to enforce EMTALA, which protects all individuals who present to a hospital emergency department seeking examination or treatment, including for identified emergency medical conditions that place the health of a pregnant woman or her unborn child in serious jeopardy." The agency further stated its intent to "rectify any perceived legal confusion and instability created by the former administration's actions." It's important to note that while the president cannot unilaterally change federal law, the Trump Administration's interpretation of existing law has shifted – placing this issue in a legally complex and unsettled space.

CMS Holds In-Person Listening Session on Health Technology

CMS held an in-person listening session on June 3, 2025, to hear from interested stakeholders on ways to use health technology to improve patient outcomes and make the healthcare system more efficient. The event coincides with the CMS' release of a request for information (RFI) on improving the health technology ecosystem, for which comments are due June 16, 2025.

Legislative Updates

CBO Releases New Cost, Coverage Estimates for the One Big Beautiful Bill Act

The Congressional Budget Office (CBO) on June 5, 2025, released updated estimates on the budgetary effects that the House-passed One Big Beautiful Bill Act will have over the next 10 years. The estimate found that the cost of extending certain tax cuts would increase the federal deficit by $2.4 trillion over the next decade. The CBO also estimated that provisions under the jurisdiction of the House Committee on Energy and Commerce, including those related to Medicaid, would create nearly $1.1 trillion in deficit reduction over the next 10 years, of which $334 billion is from imposing Medicaid work requirements. This is an increase from the CBO's prior projections on savings. The CBO also included in its projections that it estimates almost 11 million individuals could lose their health insurance coverage, including 1.4 million individuals without "satisfactory immigration status." These coverage losses would be in addition to the 5.1 million individuals who are expected to lose their healthcare coverage due to changes included in the CMS proposed rule issued March 19, 2025, titled "Patient Protection and Affordable Care Act; Marketplace Integrity and Affordability" and due to the potential expiration of advanced premium tax credits (APTCs).

The Senate is expected to continue releasing portions of the reconciliation package this week and may hold additional markups. However, it is unlikely that Senate committees with jurisdiction over healthcare – including the Senate Finance Committee – will hold a markup. The Senate will continue working to revise provisions from the House-passed reconciliation package and is likely to moderate certain portions of the bill, including by pushing back the effective date for work requirements in Medicaid. It is also anticipated that the Senate will seek to water down the state and local tax (SALT) provisions from the $40,000 cap included in the House bill in order to accommodate additional, larger tax deductions.

Regulatory Updates

NIH Releases AI RFI

The NIH issued a RFI on June 3, 2025, on an artificial intelligence (AI) strategy. The NIH intends to develop an institute-wide AI strategy to improve transparency, enhance coordination among different parts of NIH and accelerate research and development to improve patient outcomes. NIH seeks input on the themes, pillars and actions that should shape both the long-term strategy and a one-year action plan and suggests several topic areas for comment, including research, healthcare delivery and several others. Comments are voluntary and are due by July 15, 2025. More information on the RFI is available to review online.

DEA Proposes to Reclassify Substance Under CSA

The Drug Enforcement Administration (DEA) issued a proposed rule on June 9, 2025, that would place one substance under Schedule I of the Controlled Substances Act (CSA). In the proposed rule, the DEA proposes placing 3-methoxyphencyclidine (3-MeO-PCP), including its salts, isomers and salts of isomers, under Schedule I of the CSA. Placement of a substance under Schedule I indicates a substance has no currently accepted medical use and a high potential for abuse. The 3-MeO-PCP is an arylcyclohexylamine hallucinogen.

Legal Updates

Four AGs Call on FDA to Lift Abortion Drug Restrictions

Attorneys general (AGs) from California, Massachusetts, New York and New Jersey urged the FDA on June 5, 2025, to lift certain restrictions on mifepristone, arguing that the restrictions are medically unnecessary and burdensome. The AGs are calling for the FDA to remove mifepristone from the Risk Evaluation and Mitigation Strategies (REMS) program, specifically the prescriber, pharmacy and patient certification requirements.

12 AGs Challenge Gender-Affirming Care (GAC) Protections

Earlier this year, a coalition of more than a dozen Republican AGs argued that the HHS cannot justify keeping a Biden-era rule protecting gender-affirming care under the Affordable Care Act solely because the Trump Administration is unlikely to enforce it. In their motion for summary judgment filed last week, they reaffirmed their stance, contending that the now-paused rule unlawfully expands the definition of "sex" to include gender identity for the purpose of enforcing anti-discrimination protections.

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