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In collaboration with:
April 3, 2025
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Spotlight
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Major reorganizations announced at HHS, with layoffs underway: Last week, Health and Human Services (HHS) Secretary Robert F. Kennedy, Jr. announced significant changes to the department with respect to staffing and organizational structure in accordance with the White House’s February Executive Order (EO) 14210, “Implementing the President’s Department of Government Efficiency Workforce Optimization Initiative.” EO 14210 required agencies to develop reorganization plans and submit them to the Director of the Office of Management and Budget within 30 days, as well as “promptly undertake preparations to initiate large-scale reductions in force.”
The HHS announcement includes consolidating the 28 HHS divisions into 15, reducing the HHS regional offices from 10 to five, and centralizing the human resources, information technology, procurement, external affairs, and policy functions of the department. The reorganization also establishes a new Administration for a Healthy America (AHA), which will combine Substance Abuse and Mental Health Services Administration (SAMHSA), the Health Resources and Services Administration, which provides funding for community health centers and maternal and child health programs, and components of other agencies and offices. The announcement also noted that:
- The Food and Drug Administration (FDA) will decrease staff by 3,500 (approximately 19 percent of agency staff);
- Centers for Disease Control and Prevention (CDC) will decrease staff by 2,400 (approximately 18 percent of agency staff); it will also absorb approximately 1,000 Administration for Strategic Preparedness and Response staff;
- National Institutes of Health (NIH) will decrease staff by 1,200 (approximately 6 percent of agency staff); and
- Centers for Medicare & Medicaid Services (CMS) will reduce staff by 300 (approximately 4 percent of agency staff).
HHS staff began receiving layoff notices on April 1, with reports of significant terminations across FDA, SAMHSA, CDC, and other agencies. When combined with other efforts, including early retirement, current HHS staffing levels of 82,000 full-time employees will be reduced to 62,000. The announcements are depicted in the organizational chart here:
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Many questions remain about the impact to specific agencies and authorities, structure of the new AHA, as well as who is receiving reductions in force (RIF) notices. Republican members of Congress were reportedly briefed on the changes ahead of the announcement and have generally expressed a desire to streamline agency bureaucracy while supporting health and innovation, whereas Democrats have raised significant concerns with the restructuring overall as well at the specific impact of the RIFs on Medicare, Medicaid, drug approvals, and food safety. On March 31, Senator Patty Murray (D-WA), Vice Chair of the Senate Appropriations Committee, Congresswoman Rosa DeLauro (D-CT), Ranking Member of the House Appropriations Committee, and Senator Tammy Baldwin (D-WI), Ranking Member of the Senate Appropriations Labor, Health and Human Services, and Education Subcommittee, sent a letter to HHS Secretary Kennedy asking about the “plans he announced last week to gut staffing levels and reorganize” HHS “which put American’s health and well-being at risk.”
Dr. Richard Besser, President and CEO of the Robert Wood Johnson Foundation, released a statement about the mass firings at HHS. “This is not a so-called restructuring. These are reckless, thoughtless cuts that will only make American communities less healthy and less safe,” Besser wrote. “They represent an abdication of the department’s essential responsibility to promote and protect health. And they present a fundamentally different vision of what government can and should do to improve people’s lives. Americans deserve better.”
Grantmakers should watch for additional details from HHS on which offices and activities may be under different leadership or may be prioritized or de-emphasized in the restructuring. These changes can inform future funding priorities for the department, as well as areas in which there could be decreased emphasis at the federal government level.
Further, on March 28, Dr. Peter Marks, the Director of the FDA Center for Biologics Evaluation and Research, announced his resignation from the agency. In a letter addressed to Acting FDA Commissioner Sara Brenner, Dr. Marks stated he “was willing to work to address the Secretary’s concerns regarding vaccine safety and transparency by hearing from the public and implementing a variety of different public meetings and engagements with the National Academy of Sciences, Engineering, and Medicine. However, it has become clear that truth and transparency are not desired by the Secretary, but rather he wishes subservient confirmation of his misinformation and lies.”
While the Department has seen several recent departures of senior career officials from FDA, CDC, and NIH in recent months, the Trump Administration and Senate are moving forward on installing key agency leaders.
Last week, the Senate voted to confirm FDA Commissioner nominee, Marty Makary, and NIH Director nominee, Dr. Jay Bhattacharya. Dr. Makary was confirmed in a 56–44 vote, with Senators Richard Durbin (D-IL), Maggie Hassan (D-NH), and Jeanne Shaheen (D-NH) voting to confirm him, while Dr. Bhattacharya was confirmed in a party line vote of 53-47. The Senate Finance Committee also voted to advance the nomination of Dr. Mehmet Oz to serve as CMS Administrator, in a party-line vote of 14–13.
Additionally, several nominees for leadership roles within HHS, all of which require Senate confirmation, were announced:
- President Trump announced the nomination of CDC Acting Director, Dr. Susan Monarez, for the role of CDC Director. A longtime government employee, Dr. Monarez previously served as Deputy Director of the Advanced Research Projects Agency for Health (ARPA-H) and as Deputy Assistant Secretary for Strategy and Data Analytics at the U.S. Department of Homeland Security, among other roles. Dr. Monarez’s nomination will be considered by the Senate HELP Committee.
- Mr. Alex Adams was nominated for the position of Assistant Secretary for Family Support, to lead the Administration of Children and Families. Mr. Adams has served as Director of the Idaho Department of Health and Welfare since June 2024 and previously served as Administrator of the Idaho Division of Financial Management. Mr. Adams’ nomination will be considered by the Senate Finance Committee.
- Dr. Brian Christine was nominated for the position of Assistant Secretary of Health and Human Services, which leads public health policy within the agency and operates several HHS offices. Dr. Christine is a urologist who practices in Alabama. Dr. Christine’s nomination will be considered by the Senate HELP Committee.
Grantmakers should be aware of each nominee’s priorities, which are generally discussed during their Senate hearings, as they will have significant impact on agency activities and funding, if confirmed by the Senate.
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In recent weeks, HHS cut significant public health funding for state and local health departments. On March 27, HHS reportedly canceled about $12 billion in grants to state and local health departments that were awarded during the COVID-19 pandemic. CDC is expected to take about $11.4 billion from state health departments, which was originally awarded for COVID-19 testing, vaccination, and efforts to address health disparities. The administration also reportedly canceled $1 billion in SAMHSA mental health and substance use disorder grants that were distributed as part of COVID-19 response efforts.
State and local public health officials have expressed significant concern that the cuts will result in layoffs as well as impact public health activities such as infectious disease (including measles and bird flu) prevention, testing, and data collection, immunizations, diabetes education programs at local community centers, and mental health and addiction services.
HHS was also reportedly considering cuts to federal funding for domestic HIV prevention at the CDC, which has a division dedicated to the prevention of HIV and other infectious diseases, and funds state and local surveillance programs for HIV and community-outreach initiatives. In FY 2023, Congress appropriated nearly $1.4 billion for these agency efforts to prevent HIV, viral hepatitis, STIs, and tuberculosis. According to news reports, CDC’s PrEP initiative (which provides access to no-cost antiretroviral medications by HIV-negative individuals to reduce the risk of HIV infection before exposure to the virus), may be impacted by funding cuts. On March 21, 101 members of Congress signed onto a letter addressed to President Trump, urging the Administration to reconsider any plans to eliminate or reduce federal HIV programming. This week, the layoffs across HHS have reportedly significantly affected offices working on HIV programs among many other programs and activities.
Grantmakers should coordinate with state agencies on the potential impact of funding cuts to existing and future projects. Grantmakers can also educate Congress on the impacts of funding cuts to specific activities in individual states and congressional districts.
Additionally at HHS:
- On March 21, the Administration for Children and Families announced a significant reduction in the eligibility period for refugee assistance programs. The Office of Refugee Resettlement (ORR) is shortening the Refugee Cash Assistance and Refugee Medical Assistance eligibility period from 12 months to four months for participants who become eligible 45 days after publication of the notice. In the notice, ORR states that it has determined the change is necessary to avoid a significant budget shortfall amid high refugee admission numbers. The agency noted that approximately 109,800 refugees and other eligible populations have been resettled in the U.S. since October 1, 2024, in addition to approximately 714,000 ORR-eligible individuals admitted in FY 2024. The notice acknowledges that a longer eligibility period positively impacts refugees by allowing them to address medical and mental health conditions while becoming self-sufficient but cites both legal and practical constraints necessitating the reduction. Grantmakers that support refugees should ensure program managers are aware of the shortened timeline for applying for assistance in order to support individuals and families who may be eligible for this assistance.
- On March 27, the HHS Office for Civil Rights (OCR) announced that it has launched an investigation into an unnamed California medical school over alleged race-based discrimination in admissions. HHS claims that the inquiry seeks to determine whether the school “gives unlawful preference to applicants based on their race, color, or national origin.” The investigation aligns with Executive Order 14173, which attacks diversity, equity, and inclusion programs and labels them as “illegal discrimination.” This marks the fifth such investigation launched by OCR this month under the executive order, which requires agencies to identify “up to nine potential civil compliance investigations” of a range of entities, including corporations, associations, some foundations, and institutions of higher education with large endowments over $1 billion at each agency.
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The Senate is expected to begin consideration of a budget resolution as early as this week, with the goal of passing the resolution by the time the House and Senate both go into recess for two weeks on April 14th. Senate consideration of the budget resolution will also include a “vote-a-rama,” in which Senators may offer and ask for votes on any number of amendments. Currently, the House and Senate have each passed their own budget resolutions, and the chambers need to pass an identical budget resolution in order to move forward on a reconciliation bill. The key issue that needs to be resolved in order for the Senate to take up the budget resolution is which baseline to use for the reconciliation bill. The Senate favors a current policy baseline, which may reduce the need to offset parts of the Tax Cut and Jobs Act extension. The Senate parliamentarian is expected to let Senators know this week if they can move forward with this approach. The House budget used the current law baseline which necessitates more offsets. Health care stakeholders are also watching the instructions the budget resolution will give to the Senate Finance Committee and the House Energy and Commerce and Ways and Means Committees as an indicator of Medicare, Medicaid, and other policies that could be included in a reconciliation bill.
Additionally, the Congressional Budget Office (CBO) released an estimate last week stating that if the debt limit remains unchanged, the United States will likely exhaust its ability to borrow money using extraordinary measures at some point in August or September of this year. The CBO estimate creates further pressure on Congress to pass a reconciliation bill that includes a provision to address the debt ceiling before the August recess. Addressing the debt ceiling in a reconciliation bill could also increase pressure for some Republican members to seek spending reductions. Alternatively, Congress can raise the debt limit outside of reconciliation, but doing so would require Democrats to vote alongside Republicans.
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