This analysis was prepared by Venable on behalf of AACOM.
FY25 LHHS Bill & Report Analysis
On June 26, the House Appropriations Committee released the Fiscal Year 2025 bill for the Labor, Health and Human Services, Education, and Related Agencies Subcommittee. The Committee approved the measure on July 10 with a vote of 31 to 25.
Department of Health and Human Services
The bill text for the House FY25 LHHS bill can be found HERE. A summary of the bill can be found HERE. The bill report can be found HERE.
The 2025 Labor, Health and Human Services, Education and Related Agencies funding bill provides a total discretionary allocation of $185.8 billion, which is $8.6 billion (4%) below the Fiscal Year 2024 enacted score, $23.8 billion (11%) below the FY24 effective spending level, and $36.2 billion (15%) below the President’s Budget Request.
Specifically, the bill provides a total of $107.6 billion in discretionary funding for the Department of Health and Human Services (HHS), which is $8.5 billion, or 7%, below the FY24 enacted level and $14 billion below the President’s Budget Request.
Importantly, the LHHSE report includes two key provisions requested by AACOM:
Osteopathic Medical Schools — Osteopathic medicine represents a vibrant portion of the medical student education and health systems ecosystem. However, the Committee remains concerned with the historic disparity in NIH funding and representation for Colleges of Osteopathic Medicine (COMs), as well as NIH’s failure to respond to requests to create an action plan to address the agency’s chronic underfunding of osteopathic research and underrepresentation of osteopathic scientists on NIH National Advisory Councils and study sections. Additionally, the Committee is concerned that NIH continues to associate osteopathic medicine most strongly with the National Center for Complementary and Integrative Health (NCCIH). The Committee encourages the NIH to expand funding opportunities and representation across NIH Institutes and Centers, outside of NCCIH. Further, the Committee requests NIH include in the fiscal year 2026 congressional justifications information on the representation of COMs in NIH applications and awards.
Community Based Clinical Rotations — An estimated 80 percent of patient care is now provided in a range of community-based settings rather than the academic hospital where clinical training has traditionally occurred. Research shows that providing outpatient training opportunities in underserved areas—either in conjunction with or outside of inpatient training programs—encourages long-term, sustainable physician practice in high-need areas. The Committee recognizes that prioritizing community-based clinical training in rural and underserved areas leads to more physicians staying to practice in these communities. The Committee urges HRSA to work with medical schools to partner with health centers, rural health clinics, or other healthcare facilities located in medically underserved communities to increase medical school clinical rotations in rural and underserved areas.
Other highlights include:
National Institutes of Health (NIH) – The bill provides $48.6 billion to NIH, which is equal to the FY24 enacted level.
Proposes the largest restructuring of the NIH in a generation, consolidating 27 centers into 15.
The Committee provides $47 billion in discretionary appropriations, $1.4 billion in PHS Act section 241 evaluation set aside transfers, and $127 million as authorized in the 21st Century Cures Act (Cures Act) (P.L. 114–255).
Advanced Research Projects Agency for Health (ARPA-H) – The bill provides $2.56 billion for carrying out section 301 and title IV of the PHS Act with respect to biomedical imaging and bioengineering, translational sciences, advanced research projects for health, and other innovative research provided that $500 million shall be for the ARPA-H to remain available through September 30, 2027, $1 billion below the FY24 enacted level.
Centers for Disease Control and Prevention (CDC) – The bill provides $7.4 billion in total program level funding for the CDC, which is $1.8 billion, or more than 19%, below FY24 enacted levels.
The Committee recommendation for the Centers for Disease Control and Prevention (CDC) program level includes $6,204,500,000 in discretionary budget authority, $55,358,000 in mandatory funds under the terms of the Energy Employees Occupational Illness Compensation Program Act, and $1,186,200,000 in transfers from the Prevention and Public Health Fund (PPHF).
Public Health Infrastructure – The bill includes $360 million to support public health infrastructure and capacity, a ~3% increase from FY24.
Agency for Healthcare Research and Quality (AHRQ) – The Committee provides no funding for the Agency for Healthcare Research and Quality (AHRQ), however the FY25 budget request is for $387.3 billion, a 4% increase from the FY24 enacted level.
Substance Abuse and Mental Health Services Administration (SAMHSA) – The bill provides $7.5 billion for SAMHSA, a more than 1% increase from the FY24 enacted amount, which includes $7.4 billion in discretionary budget authority, $131.7 million in PHS Evaluation Tap Funding, and $12 million in transfers from the Prevention and Public Health Fund (PPHF).
Mental Health: $2.7 billion, a 4.7% decrease from the FY24 enacted level, for carrying out titles III, V, and XIX of the PHS Act with respect to mental health, including specific allocations for the National Child Traumatic Stress Initiative and evidence-based crisis systems.
Mental Health Services Block Grant – The Committee provides $1.02 billion for the Mental Health Services Block Grant (MHBG), a 1.5% increase from the FY24 enacted level. The MHBG provides funds to States to support mental illness prevention, treatment, and rehabilitation services. Funds are allocated according to a statutory formula among the States that have submitted approved annual plans. The Committee continues the 10 percent set aside within the MHBG for evidence-based programs that address the needs of individuals with early serious mental illness, including psychotic disorders and the 5 percent set aside for crises-based services. The Committee notes that, consistent with State plans, communities may choose to direct additional funding to crises stabilization programs.
Substance Abuse Treatment: $4.5 billion, an 8.6% increase from the FY24 enacted levels, for carrying out titles III and V of the PHS Act with respect to substance abuse treatment, including allocations for the State Opioid Response Grants and Certified Community Behavioral Health Clinics.
Substance Abuse Prevention: $203.2 million, a 14% decrease from the FY24 enacted levels, for carrying out titles III and V of the PHS Act with respect to substance abuse prevention.
Health Surveillance and Program Support: $146.3 million, an over 39% decrease from the FY24 enacted levels, for program support and cross-cutting activities that supplement activities funded under the headings "Mental Health", "Substance Abuse Treatment", and "Substance Abuse Prevention".
Rural Health: The Committee recognizes the unique challenges faced by those who live in rural and frontier areas to access regular mental health and substance use services. These challenges are further complicated when individuals need timely substance use disorder and mental health crisis services led by behavioral health professionals in these areas. Providers in rural areas also face unique obstacles. They may lack the full staff or resources to faithfully implement evidence-based practices or meet requirements for grant funding. Given these challenges, the Committee directs the Assistant Secretary of Mental Health and Substance Use in coordination with the Assistant Secretary for Planning and Evaluation and the Administrator of HRSA to submit a joint report to the Committee providing details on what strategies these agencies are implementing to address the unique concerns of those in rural communities. The report should address what resources are needed to improve and sustain access to prevention, treatment, and recovery oriented services, including crisis response services, and to recruit, train, and sustain sufficient workforce in rural and frontier settings within 180 days after enactment of this Act. Such a report should be made available on the agency’s website.
Health Resources and Services Administration (HRSA) – The bill includes $7.43 billion for HRSA, a 19% decrease from the FY24 enacted level. The report includes $7.64 billion, a 16.7% decrease from the FY24 enacted level.
Primary Health Care: $1.85 billion, equal to the FY24 enacted levels, for carrying out titles II and III of the Public Health Service Act (PHS Act) with respect to primary health care and the Native Hawaiian Health Care Act of 1988.
Health Workforce: $1.34 billion, a 4.4% decrease from the FY24 enacted level, for carrying out titles III, VII, and VIII of the PHS Act with respect to the health workforce.
Health Professions Education and Training – The Committee recommends $459.9 million for the health professions education and training programs authorized under title VII of the PHS Act, an 11.6% decrease from FY24 enacted levels.
Behavioral Health Workforce Education and Training – The Committee includes $158 million for the Behavioral Health Workforce Education and Training (BHWET) program, a less than 1% increase from the FY24 enacted levels.
Children’s Hospital Graduate Medical Education – The Committee includes $395 million for the Children’s Hospitals Graduate Medical Education (GME) program, a 1.3% increase from the FY24 enacted levels. This program helps eligible hospitals maintain GME programs, which support the training of residents to care for the pediatric population and enhance the supply of primary care and pediatric medical and surgical subspecialties.
Medical Student Education – The Committee includes $70 million, a 16.7% increase from the FY24 enacted level to support colleges of medicine at public universities located in the top quartile of States projected to have a primary care provider shortage. The Committee directs HRSA to give priority to applications from academic institutions located in States with the greatest number of Federally recognized Tribes. The Committee also directs HRSA to give priority to applications from public universities with a demonstrated public-private partnership.
Maternal and Child Health: $1.02 billion, a 13% decrease from the FY24 enacted level, for carrying out titles III, XI, XII, and XIX of the PHS Act with respect to maternal and child health.
Pediatric Mental Health Care Access – The Committee includes $13 million for the pediatric mental health care access program, which is equal to the fiscal year 2024 enacted level.
Ryan White HIV/AIDS Program: $2.38 billion, a 7.4% decrease from the FY24 enacted level, for carrying out title XXVI of the PHS Act with respect to the Ryan White HIV/AIDS program.
Health Systems: $126 million, a 3.3% increase from the FY24 enacted level, for carrying out titles III and XII of the PHS Act with respect to health care systems, and the Stem Cell Therapeutic and Research Act of 2005.
Rural Health: $400,907,000, an increase of 10% from the FY24 enacted level, for carrying out titles III and IV of the PHS Act with respect to rural health, section 427(a) of the Federal Coal Mine Health and Safety Act of 1969, and sections 711 and 1820 of the Social Security Act.
Rural Communities Overdose Response Program – The Committee includes $145 million, equal to the FY24 enacted level and the FY25 budget request, for this program. Within the funding provided, the Committee includes $10 million to continue the three Rural Centers of Excellence (Centers), as established by P.L. 115–245 and continued through P.L. 117–328.
HRSA-wide Activities and Program Support: $222.1 million, an 80% decrease from the FY24 enacted for carrying out title III of the PHS Act and for cross-cutting activities and program support for activities funded in other appropriations included in this Act for HRSA.
Centers for Medicare & Medicaid (CMS) – $383.6 billion, a 5.7% decrease from the FY24 enacted level.
There are also a number of additional health care policy provisions included in the FY24 spending package, including:
Office for the Advancement of Telehealth – The Committee includes $44.5 million for the Office for the Advancement of Telehealth, an increase of $2.5 million above the FY24 enacted level. Funds for the Office for the Advancement of Telehealth promote the effective use of technologies to improve access to health services for people who are isolated from health care and to provide distance education for health professionals.
Telehealth Centers of Excellence —Within the funds provided for Telehealth, the Committee provides $9 million for Telehealth Centers of Excellence, an increase of $500 thousand above the FY24 enacted level. These Centers identify best practices, serve as national training resources, and test the efficacy of different telehealth clinical applications. These Centers serve to promote the adoption of telehealth programs across the country by validating technology, establishing training protocols and by providing a comprehensive template for states to integrate telehealth into their state health provider network. Funding should serve to promote the adoption of telehealth services nationwide and help address the access to care issue faced by rural America.
Telehealth Technology Enabled Learning —The Committee recognizes the significance of telementoring in transforming healthcare training, education, and delivery. Specifically, the Committee encourages HRSA to integrate and implement a robust telementoring initiative at an academic medical center with existing Federal support and expertise in the field. This should include technology enabled delivery of evidence-based curricula, offering of practice based, culturally responsive care, advancing the skill set of health care workers, facilitating task shifting, increasing access to specialized care, including for adolescent behavioral health. The Committee further encourages this initiative to increase community level health literacy that will lead to healthier behaviors and prepare for this telementoring service to be used during public health emergencies. Telementoring, in partnership with community-based organizations, can be rapidly deployed to deliver support and training across a broad cross-section of clinical and non-clinical disciplines. The Committee includes a $2 million increase for this effort.
Department of Education
The bill provides $67.9 billion in discretionary funding for the Department of Education, a 14% decrease from the FY24 enacted level. Of this amount, the bill includes:
Student Financial Assistance – The bill provides $23.5 billion for federal student aid programs, a 4% decrease from the FY24 enacted levels. Within this amount, the agreement provides:
Pell Grants – The Committee provides $22.5 billion in discretionary funding for the Pell Grant program, the same as the fiscal year 2024 enacted level. These funds will support Pell Grants to students for the 2025–2026 award year. The Committee recommendation includes $6,335 for the discretionary portion of the maximum Pell grant award, the same as the fiscal year 2024 enacted level. Combined with mandatory funding of $1,060, this would provide a total maximum award of $7,395 for the 2025–2026 award year.
Federal Supplemental Educational Opportunity Grants – The Federal Supplemental Educational Opportunity Grant program provides need-based grant aid to eligible undergraduate students to help reduce financial barriers to postsecondary education. Federal funding allocations are awarded to qualifying postsecondary institutions under a statutory formula. The Committee provides $455 million, which is $455 million below the FY24 enacted level and the FY25 budget request.
Federal Work Study – The Federal work study (FWS) program provides funds for part time employment to help low income students to finance the costs of postsecondary education. Students can receive FWS funds at approximately 3,400 participating postsecondary institutions. The Committee provides $615 million, which is $615 million below the FY24 enacted level and the FY25 budget request.
Higher Education – The bill includes $2.8 billion for higher education, a 13% decrease from the FY24 enacted level.
