Trump Plans $40B Health Cuts, Major Agency Overhaul

The Trump administration is proposing a sweeping $40 billion cut to annual discretionary spending at the U.S. Department of Health and Human Services (HHS), according to a draft budget obtained by The Washington Post.

The plan, which would require congressional approval, aims to reduce HHS discretionary funding by roughly one-third. It’s part of a broader government downsizing effort led by President Trump and his top advisor, billionaire Elon Musk.

If enacted in 2026, the cuts would significantly shrink the $121 billion approved for HHS in 2024. While discretionary funding makes up a small portion of the department’s total $1.8 trillion budget—most of which goes to Medicare and Medicaid—it supports a wide range of vital public health programs.

The proposal comes on the heels of a major restructuring announced in March, which cut about 25% of HHS staff. Key agencies such as the Centers for Disease Control and Prevention (CDC) and the Food and Drug Administration (FDA) have also faced layoffs.

In addition to budget reductions, the draft calls for a major reorganization of HHS. Several branches of the National Institutes of Health (NIH) would be merged, and multiple programs would be eliminated, including those focused on chronic diseases, rural healthcare access, and early education for low-income families.

“The budget calls not only for cuts, but a major shuffling and restructuring of health and human services agencies,” The Washington Post reported.

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