Short Takes and Updates—March 14, 2025
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1. Zero-Based Defense (ZBD) of Critical Government Programs
In the March 12 FDA Matters blog (here) I observed that incoming leaders during a government transition are likely to think: if it looks easy, then it must be easy. Program success is likely to be unappreciated and resource needs taken for granted.
My advice: prepare a zero-based defense of the federal role in your area and the resources required to ensure that the activity continues to be successful. As explained in the footnote, this is similar but broader than zero-based budgeting. I would be happy to discuss this with any organization thinking about this approach and would be available to support your efforts.
2. Passage of FY 25 CR: FDA Level-Funded But Other Programs Hit
Later today, the Senate is expected to adopt the FY 25 Continuing Resolution passed by the House earlier this week. The House bill would fund the government through September 30, the end of fiscal year.
FDA was level-funded, which is an excellent result under the circumstances. On the other hand, the Department of Defense Congressionally Directed Medical Research Programs was cut by $859 million, or 57% (here and here). The District of Columbia budget was also cut by a billion dollars.
For those trying to figure out the fast-moving politics: Speaker Mike Johnson managed to accomplish something his predecessors were unable to do: move a Republican spending bill through the House without Democratic support. He then recessed the House until March 24. That forced the Senate to either adopt the House bill or allow a government shutdown. This morning’s Roll Call provides an excellent analysis of how Senate Democrats were out-maneuvered.
3. Multiple Budget Battles Yet to Come: FDA at Continued Risk
FY 25 CR is the very beginning of budget fights. Congress can now turn its attention to reconciliation, recissions, debt ceiling, and the FY 26 appropriations cycle.
In addition, there is a strong possibility that the President will try to impound funds appropriated in the FY 25 CR. Ultimately, the Supreme Court will decide whether impoundment violates the Constitution.
I anticipate that Congressional Republicans will try to avoid a showdown by passing legislation that parallels the impoundment. They would then try to run the political and procedural gauntlet that they just accomplished with the FY 25 CR.
4. What I am Reading: Proposed Cuts to Medicaid
Two new studies have been released on the consequences of deep cuts contained in the House-passed budget resolution, which is a blueprint for reconciliation. Medicaid, the Children’s Health Insurance Program (CHIP) and Medicare will need to generate program savings between $600 and $880 billion over the next 10 years (New York Times). The Congressional Budget Office has concluded: that level of savings is not possible without large cuts to those three programs (Washington Post).
In the March 8 edition of MedPages (here), Dr. N. Adam Brown points out that:
While 80 million Americans are insured through Medicaid, many people don't think of themselves as "on Medicaid" -- even when they are.
Why? Because Medicaid is not branded as Medicaid in most states. If you tell a patient in South Carolina, they might lose Medicaid, their eyes may glaze over. Tell them Healthy Connections is at risk? You have their attention.
Such large Medicaid and CHIP cuts, combined with cuts in medical research and support for academic medical centers, will have a significant impact on our health care system.
Eventually, there will be downstream impacts on FDA’s food, nutrition, and medical product responsibilities. I will explore this topic more fully in a future column. As just one example, if the Administration is consistent in their positions, there will be an open door at FDA for Rx-to-OTC switches.
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“Zero-based budgeting” often starts with the implicit assumption that something is needed, and the goal is efficient use of manpower and budget to achieve specified outcomes. Internal consensus is often all that is required.
What I am proposing is a bit broader: establishing a zero-based rationale for why anything is needed from any specific level of government, as well as how to successfully and efficiently deliver relevant and needed outcomes. The analysis must be capable of being communicated to external audiences whose buy-in is required.
Zero-basing analysis of FDA (which I am not suggesting is needed) would, therefore, start with establishing whether safe food and drugs needs government oversight (which we all take for granted), rather than starting with how that function can be performed most efficiently.
Impoundment is unilateral action taken by the executive branch to delay or cancel appropriations enacted into law. Generally, Congress and the courts have found impoundment unlawful. For more background: start here with the PBS explanation. More detail can be found here.