Congress passed the Labor, Health, and Human Services (LHHS) appropriations bill for fiscal year (FY) 2026 on February 3, 2026, ending a brief partial government shutdown. The bipartisan package is expected to be signed by the President and will fund the federal government through September 30, 2026. For the oncology community, the legislation is notable for increased federal investment in biomedical research, a two-year extension of Medicare telehealth flexibilities, and several policy provisions affecting pediatric cancer, physician payment, and the health care workforce.
NIH and NCI Receive Funding Increases
The FY26 bill provides $47.2 billion for the National Institutes of Health (NIH) and $7.4 billion for the National Cancer Institute (NCI), representing increases over current funding levels. At the same time, the measure maintains flat funding of $1.5 billion for the Advanced Research Projects Agency for Health (ARPA-H). Together, these appropriations reinforce federal support for the cancer research pipeline, including discovery science, translational research, clinical trials infrastructure, and efforts to improve prevention and outcomes across diverse populations.
Telehealth Flexibilities Extended Through 2027
A major health access provision in the legislation is a two-year extension of Medicare telehealth flexibilities that originated during the public health emergency and have now been extended through December 31, 2027. The extension continues policies that lifted certain geographic and originating site restrictions and preserved options such as audio-only services, helping sustain access to oncology consultations and follow-up care. For patients facing travel barriers, limited local specialty capacity, or treatment-related limitations, the continuation of these flexibilities remains an important tool for maintaining continuity of care.
Pediatric Cancer Provisions Strengthen Access and Evidence Generation
The legislation also includes provisions supported by the American Society of Clinical Oncology (ASCO) aimed at improving pediatric cancer care and research. The Accelerating Kids Access to Care Act establishes a more streamlined pathway for qualifying pediatric out-of-state providers to enroll in Medicaid and the Children’s Health Insurance Program, reducing duplicative screening and improving access to specialized services when local options are limited. The Mikaela Naylon Give Kids a Chance Act expands the Food and Drug Administration’s authority to require pediatric cancer trials for certain new drugs, including therapies used in combination with standard of care or based on adult cancer drug approvals, with the goal of strengthening evidence to guide pediatric treatment.
Physician Payment and Workforce Measures Address Stability and Well-Being
Several provisions in the package address the financial stability of practices and the well-being of the health care workforce. The bill extends the 1.0 work Geographic Practice Cost Index (GPCI) floor through December 31, 2026, helping prevent reimbursement reductions that would disproportionately affect many rural and suburban practices. It also extends a 3.1% incentive payment for qualifying participants in Advanced Alternative Payment Models for payment year 2028. In addition, the reauthorization of the Dr. Lorna Breen Act extends grant programs through FY 2030 to support mental health and resiliency across the health care workforce, an issue with increasing relevance as oncology teams navigate sustained clinical demands and staffing pressures.
PBM Reforms Aim to Improve Transparency and Value
The bill includes multiple reforms related to pharmacy benefit managers, including a requirement that PBMs pass through 100% of drug rebates and discounts directly to employer-sponsored (ERISA) group health plans. The provision is intended to improve transparency in the drug supply chain and promote clearer alignment between rebates, plan spending, and patient affordability.
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Written by Nare Hovhannisyan, MD