Congress returns with a daunting task: Pass a funding bill or the federal government shuts down

Members of Congress returned to D.C. this week with a packed agenda and the looming threat of a government shutdown on 9/30. While threats of government shutdowns are commonplace in today’s political environment, the atmosphere for a shutdown appears especially ripe this month. Lawmakers have exactly 13 scheduled legislative days to either find a bipartisan deal to extend funding or shut the government down. It’s expected that Congress will debate yet another continuing resolution to temporarily fund the government, but given the increasingly slim Republican House majority, they’ll almost certainly need Democrat support. Outside of a temporary stopgap measure, Congress is in the midst of the 2026 appropriations process, which kicked off with a committee markup on Tuesday night. The current Republican proposal cuts discretionary spending by nearly $14 billion from 2025 levels. Democrats appear to be in no mood to negotiate. Committee hearings often turn into political sparring matches, with Democrats refusing to collaborate with Republicans, focusing their time on an ongoing assault of the “One Big Beautiful Bill Act” (OBBBA) and its various cost-cutting provisions (especially Medicaid changes and reforms). Meanwhile, President Trump is irritating Congressional Republicans with his use of “pocket recissions” to cut funds from certain programs. Trump used this tool to cut $5 billion in funding in international aid programs, sparking criticism from some Senate Republicans, some of whom called the move unlawful and others asking the President to stay in his lane on funding issues. “We (Congress) need to appropriate, and the appropriations process needs to be adhered to and strengthened,” said Sen. Shelly Moore Capito (R-WV), while Sen. Lisa Murkowksi (R-AK) said Trump’s actions were unlawful and “risk throwing the entire process into chaos.” Stay tuned for a very interesting September in our nation’s capital.

FDA launches new Rare Disease Evidence Principles (RDEP) process as members of Congress express concerns about FDA handling of rare disease drug applications

Members of Congress have recently been expressing concern to the FDA regarding rare disease drug approvals, sending letters to Commissioner Makary and peppering FDA legislative affairs teams with questions. This summer, Republican members penned a second letter to Makary regarding the regulatory path for a Barth syndrome therapy. On the Hill and off, multiple stakeholders are nervous that pending submissions for rare disease therapies will miss assigned PDUFA dates, be subject to more agency scrutiny or, at worst, receive complete response letters (CRLs), otherwise known as complete rejections. Countering these concerns, the FDA announced September 3 that it was launching a new process for review of therapies for “exceptionally rare” diseases that have a known genetic defect. The FDA outlined the new review process for drugs and biologics designed to treat ultrarare genetic diseases that would allow a single-arm trial, plus other supportive data, to serve as pivotal evidence. In its announcement (FDA Advances Rare Disease Drug Development with New Evidence Principles | FDA), the agency stated the FDA’s CBER and CDER divisions would collaborate on a new approval process that will provide sponsors with more clarity on data that can demonstrate substantial evidence or effectiveness, inviting companies to submit an RDEP application prior to the launch of a pivotal trial. The agency says an exceptionally rare disease is a disease with less than 1,000 U.S. patients. Accepted companies would have regular meetings with the FDA review team to determine what data will be used to substantiate safety and effectiveness. In a statement the FDA said, “It is well understood that developing drugs for rare diseases can make it difficult or even impossible to generate substantial evidence of safety and efficacy—as required by statute—using multiple traditional clinical trials. Instead, rare disease drug developers and the FDA must work together to identify alternative methods for meeting the statutory standard that are both rigorous and viable for rare disease populations.”

House Democrats seek to undo Orphan Cures Act with newly introduced federal legislation

While rare disease patient organizations and the biopharma community applauded inclusion of the Orphan Cures Act provisions in the “One Big Beautiful Bill Act” (OBBBA) in July, Congressional Democrats wasted no time in filing legislation to repeal the law. The Orphan Cures Act language expands the definition of “orphan drug” under the Medicare Drug Price Negotiation Program, allowing drugs with multiple rare disease indications to be exempt from Medicare price negotiation and price setting. Advocates say the change was necessary to incentivize companies to continue to invest in rare disease drug development. Democrats, led by Rep. Chris Pappas (D-NH), filed H.R. 5094 on September 2. The bill would repeal the exclusion for orphan drugs under the Medicare Drug Price Negotiation Program. All of H.R. 5094’s co-sponsors are Democrats, so the legislation will not advance until 2027 at the earliest. However, the bill’s swift introduction is further evidence that Congressional Democrats remain committed to maintaining (and likely expanding) government price controls on prescription drugs if they are successful in reclaiming the House and Senate in the 2026 midterm elections. 

Florida announces plan to nix all vaccine mandates, while western states announce vaccine guidance collaboration

Florida announced plans on September 3 to become the first state to phase out all vaccine mandates, including mandates for vaccines required before school enrollment. Meanwhile, the Democratic governors of California, Oregon and Washington announced on the same day that they are forming an alliance to coordinate vaccine recommendations for their states. The contrasting moves come amid turmoil at the U.S. Centers for Disease Control and Prevention (CDC), where several top leaders resigned last week to protest efforts by Health and Human Services Secretary Robert F. Kennedy Jr. to dismiss CDC Director Susan Monarez for pushing back against Kennedy’s vaccine policies. Wednesday’s announcement in Florida included remarks from the state’s Surgeon General Dr. Joseph A. Ladapo who called vaccine mandates “wrong” and “immoral”. The proposal from Dr. Ladapo has the support of Florida Governor Ron DeSantis (R). It will need a formal recommendation from the State Department of Health and must pass the Republican-controlled Florida legislature before being implemented. Meanwhile, California, Oregon and Washington announced Wednesday the formation of a health alliance to guide residents on vaccines and immunizations because of what they call “the politicization of science” by the federal government. The governors formed the West Coast Health Alliance to collaborate and provide “evidence-based” vaccine recommendations to residents. The battle over vaccines continues at the local, state and federal levels, fueled in part by long-time vaccine critic and HHS Secretary Kennedy and elements of his Make America Healthy Again (MAHA) agenda.

Health Policy Snippets

1. New Medicaid provisions in OBBBA will impact states differently. There’s been much discussion and many predictions of what the Medicaid provisions included in the “One Big Beautiful Bill Act” (OBBBA) will mean for state Medicaid programs. In its new analysis released in August, Oxford Economics explores which states will be most impacted by various provisions within the law. Spoiler alert: If a state has a large immigrant population that is covered under Medicaid and expanded Medicaid eligibility after the Affordable Care Act (ACA), it’s likely going to be feel a stronger pinch.
2. ACA Marketplace premiums expected to increase by 18%. A new analysis of initial rate filings for Affordable Care Act (ACA) Marketplace plans submitted by 312 insurers in all 50 states and the District of Columbia finds the median proposed increase for 2026 is 18%, more than double last year’s 7% median proposed increase. The proposed rates are preliminary and could change before being finalized in late summer.