By: Nicholas Bonds, Esq.
The second Trump administration has not been shy about taking steps to shake up U.S. health policy. There has been a flurry of executive orders on a range of healthcare topics, including stepping up enforcement of price transparency rules; a push to expand coverage for and lower the out-of-pocket costs for in vitro fertilization; and taking steps to redefine sex-based discrimination in federal policy and to discourage treatments for gender dysphoria. Even so, the executive action poised to have the broadest impact on health policy may just be the sweeping changes being made to the Department of Health and Human Services (HHS).
Within moments of Robert F. Kennedy being sworn in as the 26th HHS Secretary, President Trump signed another executive order establishing the Make America Healthy Again (MAHA) Commission. The MAHA Commission will be chaired by Secretary Kennedy, with other cabinet-level officials and their designees filling out the rest of the roster. The MAHA Commission is tasked with investigating “the growing health crisis in America,” with a primary focus on lowering the rates of chronic diseases, particularly in children.
In his role as head of HHS, one of the first changes Secretary Kennedy made was to revoke the more than fifty-year-old policy at HHS captured in a notice called the Richardson waiver. This was effectively a 1971 HHS policy that instructed the department to request and consider public commentary through notice-and-comment procedures for not just formal rulemaking, but also when making changes that apply to agency management and personnel, public property, loans, grants, benefits, or contracts. By rescinding the Richardson waiver, Secretary Kennedy has significantly reshaped how HHS operates, effectively removing a significant portion of public oversight and bolstering the White House’s ability to directly control health policy.
Meanwhile, Secretary Kennedy has followed the Trump administration orders to reduce staff at HHS by cutting tens of thousands of employees, and to cut their spending on contracts by 35%. This includes significant staff reductions at other federal agencies underneath the HHS umbrella, including the Centers for Disease Control and Prevention (CDC), Centers for Medicare & Medicaid Services (CMS), Food and Drug Administration (FDA), and National Institutes of Health (NIH). Other agencies are being absorbed into HHS and consolidated into a new entity called the Administration for a Healthy America (AHA).
The argument for these cuts and restructuring has been to streamline the agencies tasked with protecting and enhancing public health, and to make them more effective and efficient. Even staunch critics of the Trump administration and this bevy of changes can concede that HHS could work better, but the magnitude of these changes is starting to have industry stakeholders concerned. The Pharmaceutical Research and Manufacturers of America (PhRMA) has begun raising questions about the FDA’s ability to regulate and approve medical devices, prescription drugs, and vaccines. And Wall Street analysts have begun openly questioning the direction HHS is heading down, pointing to an uptick in measles cases and an increase in vaccine skepticism.
It is far too early to gauge what effect the full scope of changes at HHS will actually have on public health in the U.S. Hopefully, even with fewer staff and reduced budget, the reorganized HHS can deliver on its lofty MAHA ambitions. We at Phia will be watching closely to monitor how these ongoing developments at HHS may impact self-funded plans.