Explainer of the President’s FY 2026 HHS Budget Proposal

On Friday, May 30th, the White House released details on the president’s FY 2026 budget request for health and research-related agencies. This budget request outlines the administration’s current priorities. (Side note: This is not the One Big Beautiful Bill Act (H.R. 1)

The proposed budget includes agency reorganizations and major funding cuts with the intent to enhance efficiency, reduce government spending, prevent duplicative programs, and refocus public health priorities. The changes will significantly change the makeup of federal health-related agencies that prioritize medical research for neuroscience. There is debate as to whether or not these will be beneficial.

Department of Health and Human Services (HHS)

The proposal sets aside approximately $95 billion for the Department of Health and Human Services (HHS), representing a $32 billion decrease, or a one-fourth cut from FY 2025 funding levels.

Funding for the National Institutes of Health (NIH), the nation’s largest source of funding for biomedical research, would be cut to $27.5 billion from its FY 2025 appropriated level of $46.801 billion, representing a 40% cut. The budget would include the previously proposed agency rule of capping facilities and administrative (F&A) costs, also referred to as indirect costs, at 15%.

View the Hydrocephalus Association Medical Advisory Board and Scientific Advisory Board’s previous statement on the Administration F&A funding proposal here.

National Institutes of Health (NIH) Reorganization

The FY 2026 proposal would consolidate the 27 existing Institutes and Centers into eight.
Agencies that will remain intact include:
National Institute of Allergy and Infectious Diseases (NIAID)
National Institute on Aging (NIA)
National Institute of General Medical Sciences (NIGMS)
National Cancer Institute (NCI)

All remaining institutes would be combined into new ones. The proposal would establish:
National Institute on Body Systems
National Institute on Neuroscience and Brain Research
National Institute of Behavioral Health
National Institute for Child and Women’s Health, Sensory Disorders, and Communication

The National Institute of Neurological Disorders and Stroke (NINDS), along with the National Eye Institute (NEI) and the National Institute of Dental and Craniofacial Research (NIDCR), are being merged into one new agency called the National Institute on Neuroscience and Brain Research.

Previously, NINDS alone had about $2.6 billion in funding for 2025, which supported a wide range of research, including work on hydrocephalus. Under the new plan, the combined budget for all three institutes will be only $2.445 billion. That’s nearly $2 billion less in total funding than what NINDS previously received alone.

Lastly, the functions of agencies focused on minority health, alternative medicine, nursing, and global health would be eliminated.

Additional Reorganizations Create the Administration of Healthy America (AHA)

Health Resources and Services Administration (HRSA), Substance Abuse and Mental Health Services Administration (SAMHSA), and some programs within the Centers for Disease Control and Prevention (CDC) will be merged into a new office titled the Administration of Healthy America (AHA), which will be funded at $14 billion. HRSA currently aims to strengthen healthcare access for vulnerable populations by supporting health centers, workforce training initiatives, and maternal and child health issues. SAMHSA currently provides funding, guidance, and resources to address treatment and support efforts for people with mental health and substance use disorders.

Centers for Disease Control (CDC)

The proposal would decrease funding for the Centers for Disease Control and Prevention (CDC) by nearly $3.6 billion to approximately $4.3 billion, a 53% drop from FY 2025. The proposed changes align with the Administration’s efforts to refocus the CDC on its core function, such as disease surveillance and response. While some of the functions would be moved to the AHA, many programs in the CDC’s National Center for Chronic Disease Prevention and Health Promotion would be eliminated. For example, there’s no clear plan for where programs like the Division of Heart Disease and Stroke Prevention and the Division of Cancer Prevention and Control would go or how they would continue.

Agency for Healthcare Research and Quality (AHRQ)

The proposal includes a $129 million cut for the Agency for Healthcare Research and Quality (AHRQ), which funds research into patient health outcomes and guidelines to support healthcare providers and create safer healthcare systems. It works to study new treatments and healthcare strategies, which helps improve medical quality and access for patients.

What Happens Next?

Congress ultimately has the final authority to approve or reject annual funding decisions—including any major reorganizations of federal agencies—through the appropriations process. This means that the proposed restructuring of health agencies, such as consolidating NINDS into a new neuroscience institute, is not yet official.

The Senate began its formal review, known as “markup,” on May 20th. During this stage, members of the Senate Appropriations Committee examine details of the President’s budget proposal. Each federal agency’s funding and structure is debated separately within dedicated subcommittees—for example, the Labor, Health and Human Services, Education, and Related Agencies Subcommittee handles health-related budgets for HHS sub-agencies like the National Institutes of Health (NIH).

After markup, the full committee may revise and vote on the proposal. If passed, it moves to the Senate floor for further debate and amendments. The same process occurs in the House of Representatives. Appropriations must pass the U.S. Senate by 60 votes and the U.S. House with a simple majority. For any changes to take effect, both chambers must agree on a final version and pass it into law, often through negotiation and bipartisan compromise in a conference committee.

Until that process is complete, all proposed reorganizations and funding levels remain just that—proposals.

As more details are released, the Hydrocephalus Association will continue to monitor the Administration’s budget and its impact on the federal health ecosystem and, most importantly, on any changes that are hydrocephalus-related.