In today’s issue, we cover the latest updates on the wide-ranging consequences of the recent mass layoffs at the Department of Health and Human Services (HHS), and the concerns they have spurred among public health experts and remaining staff about the agency's ability to fulfill its public health mission. We also track the U.S. Supreme Court's deliberations over states' rights to exclude Planned Parenthood from Medicaid, potentially reshaping health care access for many Medicaid beneficiaries. Also in the courts, a federal court has blocked the Trump administration’s policy to reduce research overhead payments, setting the stage for continued litigation. Meanwhile, Senate Republicans' delays in Medicaid budget decisions introduce further uncertainties to health care funding.
Amid these challenges, AcademyHealth is working diligently to advocate for transparency and support within HHS through congressional outreach, media engagement, and partnerships with advocacy groups. Our thoughts are with our colleagues at AHRQ and other HHS agencies, recognizing their invaluable contributions to public health and research
In today’s issue:
- Health Agencies Face Uncertainty Amid HHS Layoffs: How Our Community Can Respond
- SCOTUS Debates States' Power to Exclude Planned Parenthood from Medicaid
- Federal Court Blocks Trump Policy Slashing Research Overhead Payments
- Senate Republicans Delay Critical Medicaid Budget Decisions
The recent mass layoffs at the Department of Health and Human Services (HHS) have sparked significant concerns among public health experts and the remaining workforce regarding the agency's capacity to maintain its public health mission. HHS Secretary Robert F. Kennedy Jr., who initially stated that the layoffs were intended to refocus the agency's efforts, later suggested that around 20 percent of the affected employees might be reinstated due to cuts made in error. However, recent reports are now contradicting Kennedy's previous assurances. This revelation has further demoralized a workforce already disrupted by the sweeping changes.
In addition to the details about the Agency for Healthcare Research and Quality that we reported on last week, the layoffs have severely impacted key public health divisions within HHS agencies, including the Centers for Disease Control and Prevention (CDC), Food and Drug Administration (FDA), and National Institutes of Health (NIH). Offices responsible for public transparency, disease prevention, and specialized programs tackling issues like lead exposure, reproductive health, injury prevention, and smoking cessation have seen significant reductions or complete eliminations. The fallout from the layoffs extends beyond the immediate loss of personnel, affecting operational efficiency and service delivery across various programs. Remaining staff have been tasked with absorbing additional workloads, and in some cases, laid-off employees have been requested to continue working temporarily as the agency navigates the transition.
One additional concern is the 35 percent reduction in contract spending across all HHS divisions, including key agencies like the CDC, FDA, and NIH. Contracts often cover essential services and specialized functions that are not viable with full-time staff alone, such as collaborations with external laboratories and procurement of specialized research equipment. The cuts could impair the agencies' ability to maintain essential research and operational infrastructure, potentially weakening public health responses to emergencies, disease outbreaks, and ongoing health challenges.
We know that the recent news of HHS layoffs and the financial cuts impacting public health services have caused significant concern within our community. Many of you may be feeling uneasy about the future of public health research and the potential disruptions to your own work. The prospect of reduced staffing, shifting priorities, and an evolving job market can understandably feel overwhelming, particularly in an environment that’s already facing economic pressures and uncertainty.
What You Can Do:
While these developments may seem daunting, there are actions you can take to make a positive impact both for yourself and the future of public health research:
- Advocate for the Value of Health Services Research: Now is a critical time to come together as a community to amplify the importance of our work. AcademyHealth has created a toolkit to advocate for the value of AHRQ here which includes several stories of impact from vital health services research.
- Stay Connected and Support Each Other: Reach out to colleagues, mentors, and potential collaborators. By building stronger connections, you create a support system that can help you navigate uncertain times, share resources, and identify new opportunities. The solidarity within our community is one of our greatest strengths.
- Keep Your Skills Current and Explore New Opportunities: Take advantage of available training, webinars, and courses to enhance your expertise. AcademyHealth is hosting monthly member-only events to help our community in this period of change. Our next one is scheduled for April 23 and attendees will receive practical tools to strengthen research communication and increase the potential for long-term funding and real-world influence.
- Navigate Potential Career Shifts: For those looking ahead to potential changes in the job market, "Getting Ready for the Job Search" by Karen Kelsky offers helpful strategies for refining your professional platform, updating your application materials, and strengthening your network. You can read the full article here.
SCOTUS Debates States' Power to Exclude Planned Parenthood from Medicaid
Last week, the U.S. Supreme Court heard oral arguments in Medina v. Planned Parenthood South Atlantic, in which Planned Parenthood is challenging the state’s decision to prohibit their clinics from participating in South Carolina’s Medicaid program. At issue is whether the federal laws governing Medicaid create individual rights that can be enforced under federal civil rights law; in this case, the right for Medicaid beneficiaries to seek health care from any “qualified” provider.
Under federal law, states receiving federal dollars for their Medicaid programs must meet certain requirements, pursuant to Congress’ power under the Constitution’s spending clause. One of these requirements allows any patient eligible for Medicaid to seek health care from any “qualified” provider. In 2018, the South Carolina Governor Henry McMaster issued an executive order directing the state’s Department of Health and Human Services to remove abortion clinics from the Medicaid program, deeming them unqualified to provide family planning services. Planned Parenthood’s enrollment agreements were terminated, and the organization was notified that it was no longer qualified to provide services to Medicaid beneficiaries. Although South Carolina Medicaid did not cover abortions outside of the very narrow restrictions of the Hyde Amendment, the Governor reasoned that funding any health care at abortion clinics effectively subsidizes the procedure. Note: South Carolina is not one of the 17 states that uses state funds to cover abortions beyond the Hyde Amendment limits.
Julie Edwards, a Medicaid beneficiary in South Carolina who suffers from diabetes and visited Planned Parenthood for health care, joined with the organization to sue the South Carolina Department of Health and Human Services. They contended that the Governor’s executive order violated the statute that enables Medicaid beneficiaries to seek health care from any qualified provider. The U.S. District Court for the District of South Carolina granted a preliminary injunction blocking the termination of Planned Parenthood’s Medicaid enrollment agreement, and the U.S. Court of Appeals for the 4th Circuit agreed, affirming the preliminary injunction and a permanent injunction.
At the heart of the U.S. Supreme Court’s deliberation is whether, as the 4th Circuit opined, the Medicaid Act creates individual rights that can be enforced under federal civil rights law. Alliance Defending Freedom, the Christian conservative advocacy group representing South Carolina, argued that the section of the Medicaid Act that discusses access to “any qualified provider” does not explicitly invoke the words “right,” “entitlement,” or “privilege.” They follow that use of this language is critical to creating private rights in any laws enacted pursuant to Congress’s spending clause power. The liberal justices seemed to reject this assertion, suggesting that Congress had clearly established an obligation for states to give Medicaid beneficiaries access to any qualified provider, and to go to court for that right. The lawyer for Planned Parenthood stated that Congress did not intend for states to have the ability to dub health care providers as “unqualified” for reasons unrelated to medical competency. Rather, they intended to afford Medicaid beneficiaries the same, “intensely personal right” to choose their doctors that privately insured patients enjoy.
The implications of this case reverberate out from South Carolina – if the Supreme Court sides with the state, other states will likely enact similar bans targeting Planned Parenthood. The decision on this case will not only have large implications for Planned Parenthood clinics across South Carolina and the U.S., but also for the Medicaid beneficiaries who receive critical health care, like mammograms, family planning services, and vaccines, at said clinics. AcademyHealth will keep you updated regarding any changes with this and other court cases of interest.
Federal Court Blocks Trump Administration Policy Slashing Research Overhead Payments
A federal judge has issued a permanent injunction against a Trump administration policy that sought to dramatically reduce research overhead payments to universities and institutions. The move halts the National Institutes of Health's (NIH) plan to impose a flat rate of 15% for indirect costs, which support essential but non-specific research expenses, such as lab facilities and administrative salaries. Judge Angel Kelly found the policy violated the Administrative Procedure Act and was "arbitrary and capricious." Paradoxically, both the administration and plaintiffs sought this ruling to enable an appeal, setting the stage for continued legal battles over the policy's implications on the academic research community.
Senate Republicans Delay Critical Medicaid Budget Decisions
Key developments on Friday, April 4, and Saturday, April 5, resulted in delays to major budget decisions, creating uncertainty on Medicaid funding. On April 4th, Senate Republicans passed an amendment designed to protect Medicaid and Medicare; however, the language was criticized as vague, leaving concerns for future cuts. On April 5, 2025, the Senate and House Republicans passed a budget resolution (51-48) that delayed critical decisions on Medicaid spending cuts. While Senate Republicans prefer smaller reductions to Medicaid, House Republications propose up to $880 billion cuts to the program essential to millions of Americans. Senator Josh Hawley (R-Mo.) co-sponsored a bipartisan amendment with Senator Ron Wyden (D-Ore.) to remove the House's language on Medicaid cuts from the resolution, but this amendment failed 49-50. Senator Susan Collins (R-Maine) also voted against the proposed Medicaid cuts, warning that reductions would harm many seniors, disabled individuals, and families, especially in her state.
In lieu of settling Medicaid funding disagreements, the current and temporary resolution delays the decision to allow each side to propose different levels of cuts. Until then, Medicaid remains at risk and the hard choice about Medicaid will be made later, likely at the last minute.
Previous Updates
This is the latest in a series of Situation Report updates from AcademyHealth. You can find prior issues here.
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