Healthcare and life sciences

The pre-election baseline was a sharp contraction of federal health spending. The enhanced ACA premium tax credits expired on 31 December 2025, and open enrollment for 2027 began on 1 November with higher premiums and no enhanced subsidies (NPR). The July 2025 reconciliation law's Medicaid work requirements must be in place by 1 January 2027 (KFF). On drug pricing the administration worked through deals rather than statute. The first wave of most-favored-nation agreements covered 17 major drugmakers, and an April 2026 Section 232 proclamation set tariffs of up to 100% on patented pharmaceutical imports, cut to 20% for companies that move production to the United States and lower still for those that also sign MFN pricing deals (Reuters; Reuters; White House). HHS Secretary Robert F. Kennedy Jr. reshaped the vaccine advisory process and cut funding for some mRNA work.

A Democratic Congress cannot restore the subsidies on its own, because Trump would veto a stand-alone bill. It can make them the price of something the administration wants. Defense appropriations and the December funding bill are the obvious vehicles; BNP Paribas economist Anis Bensaidani said Democrats may lack the votes to restore major parts of the ACA but could win concessions in negotiations over defense spending and government funding (Reuters). Any delay of the Medicaid work requirements would need a statute or a funding rider before 1 January, which the lame-duck Republican majority is unlikely to pass. From January, Democrats plan inquiries into prescription drug pricing (Politico), and MFN deal terms, vaccine policy, FDA staffing and NIH grant cancellations are likely subjects for hearings.

The executive retains the instruments it has used. MFN agreements are contracts between HHS and individual companies, which the election does not alter, and the Section 232 pharmaceutical tariffs and their exemptions remain a presidential decision. What changes is the cost of using them quietly. Companies that signed MFN deals are likely to face document requests on the terms they accepted and on the TrumpRx platform, and the administration may find deals harder to extend if each is followed by a hearing.

Markets read the result as positive for providers and insurers with Medicaid and exchange exposure. HCA rose 5.4%, Universal Health Services 3.4% and Centene 4.7% on 4 November (Reuters). For pharmaceutical companies the balance is mixed: more scrutiny of pricing and the likely push to widen Medicare negotiation, against a better chance that Congress protects NIH and FDA review capacity through appropriations. Restrictions on Chinese contract manufacturers became law through the BIOSECURE provisions of the FY2026 NDAA (Arnold & Porter), and their implementation is one of the few health issues with support in both parties.