Congress Advances Bipartisan Spending Legislation with Healthcare Components; More Appropriations to Come

In a rare display of bipartisan cooperation, lawmakers in both chambers of Congress have reached agreement on a sweeping healthcare package tied to a broader $1.2 trillion federal spending bill.

The package is part of a funding measure released last week by U.S. House of Representatives appropriators that the full House passed last Friday. The Senate is expected to take it up this week as Congress races to meet a looming deadline coming up at the end of the month to keep the government open.

While the legislation does not include an extension of the Patient Protection and Affordable Care Act’s (PPACA’s) enhanced premium tax credits, which have been a priority for many Democrats, it does include other substantial health policy provisions.

Together, the measures reflect a concerted effort by negotiators to stabilize programs that had expired or were on the brink of lapsing, while also addressing issues in areas such as Medicare oversight, provider regulation, and access to care.

Let’s quickly highlight a few of the notable provisions:

One of the key components of the package is a two‑year extension of Medicare’s expiring pandemic‑era telehealth flexibilities. The extension helps preserve access to remote care that has been especially vital for rural and underserved communities. Providers across the country have warned that allowing these waivers to lapse would disrupt care for millions of patients.

In addition to telehealth, the bill provides one‑year extensions of two key Medicare programs: the Medicare‑Dependent Hospital program and the Low‑Volume Hospital Adjustment. Both programs offer enhanced reimbursement rates to facilities that serve small or geographically isolated populations.

The package also addresses concerns by some lawmakers about Medicare Advantage (MA) plan administration, including requiring improved accuracy of provider directories, and contains several components related to pharmacy benefit manager (PBM) reform.

The PBM policies included are nearly identical to a set of bipartisan PBM reforms that advanced late in 2024, but were ultimately blocked from final passage. They include requirements regarding things like rebates and discounts used to lower drug costs and transparency related to cost performance measurements for rebates, discounts, price concessions, and net costs.

This renewed effort signals sustained congressional interest in addressing business practices that some lawmakers have called opaque, and partially to blame for rising prescription drug costs.

Significant funding increases for federal health agencies are also included in the bill. In particular, the legislation allocates over $4 billion to support Centers for Medicare & Medicaid Services (CMS) operations – a nearly $200 million increase – bolstering oversight of programs like Medicare, Medicaid, and the PPACA marketplaces. The bill also provides about $50 billion for the National Institutes of Health (NIH).

In terms of a broader healthcare policy direction that Congress might take before the midterms, one hint may be found in a proposal put forward by the Republican Study Committee, a group that represents broader conservative interests in healthcare reform. The Committee recently introduced its own framework for a separate, large reconciliation bill envisioned for 2026, dubbed the “One More Big Beautiful Bill Act.”

It includes aspirational ideas such as restructuring PPACA subsidies, expanding the use of health savings accounts, and introducing new Medicaid funding cuts.

For now, though, we focus on the end of the month, and averting another potential government shutdown. If you asked anyone in D.C. last week, they would have said almost assuredly the government would not shut down. But with the shooting and turmoil in Minneapolis this past weekend, there’s now serious risk of another hiatus.

But ultimately, as Congress moves its current spending package toward final passage, the legislation, coupled with lawmakers’ quick, bipartisan agreement on moving it forward, reflect a pragmatism rarely seen on Capitol Hill of late. So I say, let’s not take for granted Congress’s prioritization of stabilizing key healthcare programs, even as larger spending debates lie ahead.