Senate sends health, funding bill to House after ICE standoff

Modern Healthcare – Friday, January 30, 2026
By Michael McAuliff

The Senate passed legislation Friday to enact key healthcare priorities, but it did so too late to avoid a partial government shutdown starting at midnight.

Passage was delayed after Democrats insisted on changes to the portion of the bill funding the Homeland Security Department in the wake of federal agents killing two Minneapolis residents.

Republicans ultimately agreed to split off the legislation funding homeland security in the long term. The deal enabled funding for the Health and Human Services Department to pass, along with measures to regulate pharmacy benefit managers and allow Medicare payment for telehealth and hospital-at-home services, among many other health items.

The Senate passed the legislation with a 71-29 vote.

The House passed the bill last week, but it must do so again after the changes. It was unclear whether the chamber would seek additional tweaks.

The House was not expected to return until Monday, and funding for about two-thirds of the government runs out at the end of Friday.

A brief shutdown would have little impact on the health sector, but a longer one could harm community health centers and providers of the impacted remote services.

The bill:

• Enacts pharmacy benefit manager legislation
• Extends Medicare’s telehealth rules for two years and hospital-at-home rules for five
• Funds $4.6 billion for community health centers
• Delays Medicaid disproportionate share hospital payment cuts until 2029
• Extends add-on payments for low-volume and Medicare-dependent hospitals, Medicare geographic payment adjustments for doctors, and ambulance payments through the end of the year
• Restores a 3.1% bonus for physicians participating in Medicare alternative payment models
• Delays reclassifications of hospitals under Medicare reimbursement rules until the end of the year
• Funds numerous disease-treatment and grant programs
• Extends in-home cardiopulmonary rehabilitation flexibilities
• Tightens rules for durable medical equipment under Medicare
• Funds graduate medical education programs through 2029
• Funds the National Health Service Corps
• Increases funding for the World Trade Center Health Program
• Extends special diabetes program funding
• Extends public health preparedness programs

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