Federal Update: Lame Duck Heads toward Second CR; House Passes Cures Bill

December 1, 2016

The lame-duck session of the 114th Congress resumed its work this week after the Thanksgiving holiday, notably on two main issues of University interest—the House’s passage of the 21st Century Cures bill to authorize future supplemental funding for NIH, and the funding of the government beyond the current December 9 expiration. Meanwhile, the Trump Administration continues to take shape with several more Cabinet and high-level personnel announcements, and House Democrats this week chose Nancy Pelosi to lead the Democratic caucus for an eighth term.

Funding Outlook

Despite repeatedly expressing the desire to complete FY17 funding before the end of the year, Republican leadership, after consulting with President-elect Trump’s team before the break, will delay major funding decisions until after the President elect and new Congress are sworn in. The plan is to pass another stopgap continuing resolution (CR), extending essentially level funding through March or possibly even May 2017. Due to the length of the CR and the uncertainty created for agencies managing programs, we may see provisions known as anomalies that in some cases may increase agency flexibility in order to respond to pressing needs. The Defense Department appears almost certain to receive an anomaly for war funding, but otherwise there are no guarantees which—if any—agencies will receive this special treatment. We continue to press for consideration of investments in priority areas, but as we previously reported here, stopgap funding under continuing resolutions undermines programs that may already have received favorable treatment under the pending but stalled appropriations process. Research funding that received bipartisan support throughout the appropriations process is an example of collateral damage of this process.  

21st Century Cures

One research priority did see progress this week; a retooled version of the 21st Century Cures Act passed the House in a bipartisan 392-26 vote and is headed for Senate consideration early next week. All of Massachusetts’ House members supported the bill. This new version of Cures is the culmination of Congress’s two-year bipartisan, bicameral effort to provide additional resources for NIH and FDA, ease some administrative burdens on HHS-sponsored awardees, and speed FDA approval of pharmaceuticals and medical devices.

Early versions of the 21st Century Cures bill provided mandatory appropriations for NIH of $8.75 billion over five years, making it a primary focus of research advocates over the past two years. The new, pared-down bill authorizes modest but steady increases for NIH’s base budget over three years and for the first time provides $4.8 billion over 10 years in new “Innovation Project” funding for three priorities: the Cancer Moonshot, precision medicine, and the BRAIN Initiative.

Importantly, the Innovation Project funding, while no longer mandatory in the bill, will circumvent existing caps on spending because offsets are already included in the underlying legislation. However, funding under the plan is contingent on appropriators’ willingness to release the funds each year, and on Congress’s ability to enact annual appropriations. 

In addition to new resources, lawmakers have also attempted to reduce some administrative burden on research grant recipients. For example, the bill directs the HHS Secretary to review and make revisions to current policies related to financial conflicts of interest, requires NIH to take steps to improve sub-recipient monitoring requirements on primary awardees, instructs HHS and NIH to streamline financial reporting procedures, and directs OMB to create a new Research Policy Board responsible for making recommendations on how to modify and harmonize regulations and policies to minimize administrative burden.

Cures now moves to the Senate, where some members have registered concerns, like Senator Chuck Grassley (R-IA), or outright opposition, such as Senator Elizabeth Warren (D-MA). Sen. Warren objects to the elimination of the mandatory funding provisions of the original bill and to the current funding mechanism that uses an ACA fund as an offset, and she has characterized the FDA-related reforms as “huge giveaways” to the drug industry. Though the path in the Senate will no doubt be bumpy and the outcome uncertain, Cures has been given procedural advantages that should assist its passage, and it will likely receive bipartisan support. Before the House vote, the Obama Administration issued a Statement of Administrative policy strongly urging passage of the bill.

While the funding for NIH in this iteration of the legislation is less generous and less certain than it was in a previous version, the new Cures package represents the best of what could be achieved for NIH funding after two years of efforts. Given the challenging appropriations landscape ahead under an incoming Administration and Congress that are expected to prioritize Defense spending at the expense of non-Defense, as well as the return of the sequester in FY18, this legislation provides possible means to achieve sustained increases for biomedical research in the coming years.

New Administration

In the midst of the very public intra-transition squabble over the Secretary of State nomination, President-elect Trump announced several more high-level appointments and nominations. The transition team officially announced businesswoman and philanthropist Betsy DeVos as its pick for Secretary of Education and tapped House Budget Committee Chairman Tom Price (R-GA) for Secretary of Health and Human Services. Mrs. DeVos is a longtime active supporter of school choice programs but lacks a clear record on higher education policy. Rep. Price, a medical doctor and favorite among fiscal conservatives, is a vocal critic of the Affordable Care Act and author of budget resolutions that would make significant non-Defense funding cuts.

House Democratic Leadership

Earlier this month, after rank-and-file Democrats circulated a petition calling for leadership elections to be delayed, current Minority Leader Nancy Pelosi (D-CA) rescheduled the vote for this week. Although Leader Pelosi won reelection yesterday, she faced a challenge to her position from Tim Ryan (D-OH), her most serious competition since 2010. Ryan’s candidacy was seen as a reaction to Democrats’ disappointing performance in this year’s elections, a push to reach out to working-class voters, and an effort to shift the Democratic caucus’s leadership formula away from pure seniority. Whip Steny Hoyer (D-MD) and Assistant Leader Jim Clyburn (D-SC) also kept their spots in the vote. 


At this time, Congress appears intent on adjourning on or before Friday, December 9. We will remain closely engaged as these moving parts continue to coalesce, and we will keep you informed with the latest significant developments. In the meantime, as always, please feel free to reach out to Kevin Casey (kevin_casey@harvard.edu), Suzanne Day (suzanne_day@harvard.edu), or Jon Groteboer (jon_groteboer@harvard.edu) on our Federal Relations team.