This analysis was prepared by Venable, LLP on behalf of AACOM.
Senate FY25 LHHSE Bill & Report Analysis
On August 1, the Senate Appropriations Committee released the Fiscal Year 2025 bill for the Labor, Health and Human Services, Education, and Related Agencies Subcommittee (LHHSE). The Committee approved the measure in a vote of 25 to 3.
Department of Health and Human Services
The bill text for the Senate FY25 LHHSE 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 $231.34 billion, which is a slight increase from the House Appropriators’ $185.8 billion LHHSE measure, and a 3% increase from the FY24 enacted level. Both chambers must resolve their differences when they return from congressional recess in September. Lawmakers will have to decide whether to fund the government or pass a stopgap measure to keep the government lights on through the presidential elections.
Specifically, the bill provides a total of $122.8 billion in discretionary funding for the Department of Health and Human Services (HHS), which is $5.8 billion, or roughly 5%, above the FY24 enacted level, and $1.2 billion above the President’s Budget Request.
Importantly, the Senate LHHSE report includes two key provisions requested by AACOM:
Osteopathic Medical Schools — Colleges of Osteopathic Medicine educate 25% of all US medical students and prioritize research and training in primary care and rural and underserved healthcare. The Committee understands osteopathic medical schools and their principal investigators are welcome to review and apply for any National Institutes of Health (NIH) funding opportunities in the same way other organizations seeking NIH support do and that the same is true for Doctors of Osteopathy (DOs) on NIH National Advisory Councils and study sections. Further, the Committee recognizes the historic relationship between osteopathic medicine and the research priorities of NCCIH but that DOs have been designated on applications submitted to and awarded from other NIH Institutes and Centers. The Committee encourages NIH to continue engaging with researchers from Colleges of Osteopathic Medicine, encouraging them to apply for available funding opportunities across NIH Institutes and Centers, and requests an update in the fiscal year 2026 CJ of how Institutes and Centers are expanding research and representation opportunities for Colleges of Osteopathic Medicine.
Community Based Clinical Rotations —The Committee recognizes that patient care is frequently provided in a range of community-based settings and that providing outpatient training opportunities in underserved areas encourages long-term, sustainable physician practice in high-need areas. The Committee encourages HRSA to evaluate and facilitate opportunities for medical schools to partner with FQHCs, Rural Health Clinics or other healthcare facilities located in medically underserved communities to increase medical school clinical rotations in rural and underserved areas.
Further, the report also mentioned this provision which AACOM has advocated for:
Non-Pharmacologic Treatments for Pain —Non-pharmacologic treatments for pain management have shown to be effective in reducing pain and reliance on prescription opioids. The Committee encourages CMS to consider ways to expand the use and coverage of non-pharmacologic treatments, such as osteopathic manipulative treatment and other alternative treatments as appropriate, for back and other pain.
Other highlights include:
National Institutes of Health (NIH) – The bill provides $50.351 billion to NIH, which is $1.75 billion more than the FY24 enacted level.
The Committee provides $48.8 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 $1.5 billion for ARPA-H, which is equal to the FY24 enacted level.
Centers for Disease Control and Prevention (CDC) – The bill provides $9.395 billion in total program level funding for the CDC, which is $173 million more than the FY24 enacted level.
The Committee recommendation for the Centers for Disease Control and Prevention (CDC) program level includes $8,153,532,000 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 $365 million to support public health infrastructure and capacity, a ~4% increase from FY24.
Agency for Healthcare Research and Quality (AHRQ) – The Committee provides $376 million for the Agency for Healthcare Research and Quality (AHRQ), which is a ~1.9% increase from FY24.
This funding is combined with $126 million in mandatory funding from the Patient Centered Outcomes Research Trust Fund.
Substance Abuse and Mental Health Services Administration (SAMHSA) – The bill provides $7.5 billion for SAMHSA, a more than increase from the FY24 enacted amount, which includes $7.4 billion in discretionary budget authority, $133.6 million in transfers available under section 241 of the PHS Act, and $12 million in transfers from the Prevention and Public Health Fund (PPHF).
Mental Health: $2.9 billion, a 3.3% increase 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 $1.04 billion for the Mental Health Block Grant (MHBG), a $35 million 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.
Substance Abuse Treatment: $4.2 billion, a 1.8% 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: $246.8 million, a 4.2% increase 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: $232.9 million, an 3.6% 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 importance of the Corps Scholarship Program, especially in combating the rural healthcare provider shortage, and encourages HRSA to increase the number of scholarships provided. Providing Corps scholarships, particularly to students from rural communities, will increase equitable access to medical school and help to solve the rural provider workforce shortages throughout the United States. The Committee also recognizes the success of the Rural Centers of Excellence in addressing substance use disorders within rural communities through various evidence-based treatment and recovery models. The Committee supports HRSA’s continued investment in the current Centers and encourages HRSA to consider how the Centers can expand their outreach into other underserved communities.
Health Resources and Services Administration (HRSA) – The report includes $8.9 billion, a less than 1% increase, 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: $1.41 billion, a less than 1% increase 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 $536.3 million for the health professions education and training programs authorized under title VII of the PHS Act, an 5% increase from FY24 enacted levels.
Behavioral Health Workforce Education and Training – The Committee includes $113 million for the Behavioral Health Workforce Education and Training (BHWET) program, equal to the FY24 enacted levels.
Children’s Hospital Graduate Medical Education – The Committee includes $390 million for the Children’s Hospitals Graduate Medical Education (GME) program, equal to 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 $36 million, a 40% decrease 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 notes that this program has significant unspent balances from previous fiscal year appropriations that will continue to be available to public universities that meet the program criteria.
Maternal and Child Health: $1.1 billion, a less than 1% increase 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 $14 million, a 7.6% increase from FY24 enacted levels, for expanding access to behavioral health services in pediatric primary care by supporting the development of pediatric mental healthcare telehealth access programs.
Ryan White HIV/AIDS Program: $2.57 billion, equal to the FY24 enacted level, for carrying out title XXVI of the PHS Act with respect to the Ryan White HIV/AIDS program.
Health Systems: $135 million, a 10.6% 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: $385,907,000, an increase of 5.8% 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 Opioid Response Program – The Committee includes $155 million, an increase of 6.4% from the FY24 enacted level and the FY25 budget request, for this program. Within the funding provided, the Committee includes $11.5 million to continue at least three Rural Centers of Excellence (Centers), as established by P.L. 115–245 and continued through P.L. 116-260 and 117-103. Within the total provided for RCORP, the Committee includes $4 million to support career and workforce training services and other needs related to substance use challenges within the Northern Border Regional Commission’s rural regions to assist individuals affected by a substance use disorder.
HRSA-wide Activities and Program Support: $1.09 billion, a 1.5% decrease from the FY24 enacted levels. Within the total, $165.3 million is provided for program management.
Centers for Medicare & Medicaid (CMS) – $383.6 billion, a 5.7% decrease from the FY24 enacted level.
Office for the Advancement of Telehealth – The Committee provides $44.05 million, an increase of 4.7% from the FY24 enacted level, for the Office for the Advancement of Telehealth (OAT) which promotes the effective use of technologies to improve access to health services for people who are isolated from healthcare and to provide distance education for health professionals. The Committee strongly supports OAT and their mission to expand high quality medical care to rural communities that do not have adequate access to medical providers including many medical specialties.
Telehealth Centers of Excellence – The Committee provides $8.5 million for Telehealth Centers of Excellence, equal to FY24 enacted levels. The Centers identify best practices, serve as national training resources and test the efficacy of different telehealth clinical applications. The 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.
Department of Education
The bill provides $80 billion in discretionary funding for the Department of Education, a 1% increase from the FY24 enacted level. Of this amount, the bill includes:
Student Financial Assistance – The bill provides $24.6 billion for federal student aid programs, equal to 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 FY24 enacted level. These funds will support Pell Grants to students for the 2025-2026 award year. The Committee recommendation includes $6,435 for the discretionary portion of the maximum Pell grant award, $100 more than the FY24 enacted level. Combined with mandatory funding of $1,060, this would provide a total maximum award of $7,495 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 $910 million, which is equal to 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 $1.23 billion, which is equal to the FY24 enacted level and the FY25 budget request.
Higher Education – The bill includes $3.3 billion for higher education, a 2% increase from the FY24 enacted level.