What you need to know about the forces reshaping our industry.


January 28, 2019

The 35-day government shutdown is over—but uncertainty lingers at FDA

Daily Briefing

    President Trump on Friday signed into law a bill that temporarily funds FDA, the Indian Health Service (IHS), and other federal agencies that were affected by the partial government shutdown that lasted a record 35 days, Modern Healthcare reports.

    Your cheat sheets for understanding health care's legal landscape

    The bill funds affected federal departments and agencies through Feb. 15, setting up the potential for another partial shutdown in about three weeks.

    About the shutdown

    The shutdown occurred after members of the 115th Congress and Trump failed to reach an agreement on a short-term spending bill to extend funding for seven federal departments, FDA, and other federal agencies, including IHS, by the Dec. 22, 2018, deadline.

    Trump earlier this month met with leaders of the 116th Congress to negotiate a plan to fund the federal government and end the partial shutdown, but they did not reach such a deal. Trump during the meeting said he would end the partial shutdown if federal lawmakers agreed to fund the border wall, but House Speaker Nancy Pelosi (D-Calif.) said she would not support such funding, even if it meant the partial shutdown would end.

    Since convening Jan. 3, the Democratic-controlled House passed several separate spending measures to reopen some or all of the departments and agencies affected by the shutdown, but none included funding for the border wall or garnered enough votes for approval.

    The shutdown caused FDA, the Department of Homeland Security, and the Environmental Protection Agency to scale back certain activities related to monitoring food safety and potential illness outbreaks, as well as other public health surveillance actions. The shutdown also reduced FDA's drug reviews and strained IHS facilities, with IHS only able to "perform national policy development and issuance, oversight, and other functions necessary to meet the immediate needs of the patients, medical staff, and medical facilities," according to an HHS contingency plan.

    The shutdown also affected rural health programs and several health-related lawsuits.

    The Congressional Budget Office (CBO) on Friday projected the partial government shutdown cost the United States $11 billion in economic activity in the last quarter of 2018 and the first quarter of 2019, of which $3 billion is unlikely to be recovered.

    CBO stated, "Among those who experienced the largest and most direct negative effects are federal workers who faced delayed compensation and private-sector entities that lost business." It added, "Some of those private-sector entities will never recoup that lost income."

    Trump, federal lawmakers reach deal to reopen federal government

    Trump on Friday announced that he had reached an agreement with congressional leaders on a temporary spending bill that funds affected departments and agencies through Feb. 15. The House and Senate approved the bill Friday, and Trump signed it into law, ending the partial shutdown.

    The bill does not include funding for a border wall, the Wall Street Journal reports. Trump said he plans to begin negotiations with federal lawmakers on a long-term spending bill, but added that the partial shutdown could resume if lawmakers do not agree to fund the border wall.

    Questions remain for FDA, advocacy group says

    Alliance for a Stronger FDA in a newsletter published Friday wrote that it is unclear how FDA will resume its operations and bring back furloughed staff, Inside Health Policy reports.

    Steven Grossman, deputy executive director for the Alliance for a Stronger FDA, said, "Somebody on [FDA Commissioner Scott Gottlieb]'s team undoubtedly has a plan for informing furloughed workers to report and reconstituting the entire agency. But up until [Friday] afternoon that wasn't on anybody's mind. Once fully staffed, every office will have to assess their workload and decide which tasks come first."

    The Alliance for a Stronger FDA said "there is no guessing" whether Trump and federal lawmakers will reach an agreement on a long-term spending measure to keep FDA fully funded for the rest of the fiscal year. The alliance said it would be "particularly bad … for FDA" if lawmakers and Trump continue to authorize only short-term funding bills for FDA because those bills likely would "bypas[s] large increases for FDA that were part of both the House and Senate appropriations bill (Luthi, Modern Healthcare, 1/25; Ballhaus et al., Wall Street Journal, 1/25; Cornwell et al., Reuters, 1/27; Roza, Inside Health Policy, 1/25 [subscription required]; Diamond, "Pulse," Politico, 1/28; Mui, CNBC, 1/28). 

    Your cheat sheets for understanding health care's legal landscape


    To help you keep up with the ever-changing regulatory environment, we recently updated our cheat sheets on some of the most important—and complicated—legal landmarks to include a brand new one-pager on the new tax law.

    Check out the cheat sheets now for everything you need to know about MACRA, the Affordable Care Act, antitrust laws, fraud and abuse prevention measures, HIPAA, and the two-midnight rule.

    Get the Cheat Sheets

    Have a Question?


    Ask our experts a question on any topic in health care by visiting our member portal, AskAdvisory.