Is Rubio's PEPFAR claim ‘made up'?
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With Carmen Paun and Robert King
Driving the day
SHOW ME THE MONEY — Democrats are sparring with Secretary of State Marco Rubio over the President's Emergency Plan for AIDS Relief, the HIV and AIDS program credited with saving millions of lives in poor countries, Carmen, Amanda Friedman and Robert report.
President Donald Trump shut down the agency that signed off on most PEPFAR spending and fired staffers who supported it. Democrats say the administration is lying about the state of the program following massive foreign aid cuts led by Elon Musk and his Department of Government Efficiency.
Rubio has suggested those concerns are overblown, considering that PEPFAR remains '85 percent operative,' a claim that he made repeatedly in budget testimony before Congress.
But neither Rubio nor the State Department will provide a detailed accounting to back up the figure.
Dems say: 'It's made up,' Hawaii Sen. Brian Schatz said when asked by POLITICO about the 85 percent figure. 'It's the most successful, bipartisan, highly efficient life-saving thing that the United States has ever done, and Elon Musk went in and trashed it.'
Schatz confronted Rubio about the cuts at a Foreign Relations Committee hearing in May, telling him: 'You are required to spend 100 percent of the money.'
Rubio's retort: Rubio said the 15 percent cut targeted programs that weren't delivering the services the government was paying for. He pointed to fraud in Namibia and armed conflict in Sudan as reasons for slashed funding, although it isn't clear those instances were related to PEPFAR.
Asked repeatedly by POLITICO for more clarity on what the 85 percent figure represents, a State Department spokesperson said that 'PEPFAR-funded programs that deliver HIV care and treatment or prevention of mother to child transmission services are operational for a majority of beneficiaries.'
Data collection is ongoing to capture recent updates to programming, the spokesperson also said, adding: 'We expect to have updated figures later this year.'
The day after his exchange with Schatz, Rubio told the House Foreign Affairs Committee that he meant 85 percent of PEPFAR's beneficiaries were still getting U.S. assistance. But the goal, he said, was to pass off the work to the countries where the beneficiaries live.
'We're by far the most generous nation on Earth on foreign aid, and will continue to be by far with no other equal, including China, despite all this alarmist stuff,' he said.
Big picture: For flummoxed Democrats, the tussle with Rubio indicates a broader problem: How to respond to Trump's budget requests when his administration refuses to spend the money Congress has provided.
Trump last month asked Congress to cut PEPFAR's budget for next year by 40 percent.
WELCOME TO MONDAY PULSE. I'm Erin Schumaker, POLITICO's National Institutes of Health reporter, filling in today for Kelly. Are you a current or former NIH employee considering a job offer abroad? Shoot me a message!
Send your tips, scoops and feedback to eschumaker@politico.com and khooper@politico.com, and follow along @erinlschumaker and @Kelhoops.
Congress
RACE TO FINISH MEGABILL — Senate Republicans could finalize their domestic policy megabill this week, Robert reports, finally tackling Medicaid changes.
Republicans are expected to release text for the Medicaid portion of the spending package, which seeks to extend President Donald Trump's tax cuts. The megabill includes changes to Medicaid, like restrictions on eligibility, to help generate more than $700 billion in savings to pay for the tax cuts.
Senate Republicans generally agree on adding work requirements, which will mandate some able-bodied beneficiaries complete 80 hours a month of work, job training or another activity. There are exemptions for pregnant women and disabled people, among others.
But there are some disagreements surrounding states' ability to levy taxes on hospitals and other providers to pay for their share of Medicaid, which is funded jointly by the federal and state governments.
The House version places a moratorium on new state provider taxes but leaves current ones intact. But the question is whether the moratorium will remain intact in the Senate bill, which leadership aims to pass before July 4.
Insurance
PUSH AGAINST MEDICARE ADVANTAGE CHANGES — A key insurer-backed advocacy group is trying to block Senate Republicans from changing the popular Medicare Advantage program to find savings for their domestic policy megabill, Robert reports.
The Better Medicare Alliance, which includes insurers among its members and advocates for Medicare Advantage, is running ads in the Washington Reporter calling for Republicans to protect the program that enables older Americans to buy private insurance plans offering benefits not covered by traditional Medicare, like dental.
The group said it will also share polling data with lawmakers that shows older Americans overwhelmingly oppose the changes being discussed.
'Cutting Medicare Advantage, and particularly in-home care, would break a promise to millions of seniors who rely on it,' said Mary Beth Donahue, president and CEO of the Better Medicare Alliance.
Last week, Senate Republicans weighed whether to add a bill co-sponsored by Sens. Bill Cassidy (R-La.) and Jeff Merkley (D-Ore.) to the larger package, which seeks to extend President Donald Trump's tax cuts. The legislation, called the No UPCODE Act, clamps down on tools Medicare Advantage plans use to generate higher payments from the federal government.
Cassidy pushed back on the attacks from the insurance industry and Democrats who said the legislation cuts benefits.
'We're taking care of patients and we're trying to rescue the program,' he said in a statement. 'To say the No UPCODE Act has bipartisan support is an understatement. This addresses an issue both Republicans and Democrats have called waste, fraud and abuse.'
Merkley said in a statement that he still supports the legislation but that it should be considered 'through regular order, not in the context of a partisan bill that will end up leaving 16 million people without healthcare.'
The House did consider adding similar language to its bill but eventually backed off.
AROUND THE AGENCIES
NIH BUDGET TALKS — NIH Director Jay Bhattacharya will testify tomorrow on the agency's budget proposal, which calls for a 40 percent funding cut.
The hearing before the Senate Appropriations Labor, HHS, Education and Related Agencies Subcommittee comes amid widespread discontent at the NIH. Last month, members of the NIH fellows union walked out of a town hall Bhattacharya held in protest of cuts to programs, layoffs and funding uncertainty.
While Congress will ultimately decide how much money the agency gets, and could restrict how it's dispersed, we'll be watching for how Bhattacharya defends:
— The indirect cost rate cap. The budget plan proposes capping at 15 percent the rate the NIH pays for administrative and facilities costs to grantees. But lawmakers, including Republicans, have criticized indirect cost caps, which the NIH first tried to impose in February. A federal court blocked that move, and the administration has appealed.
Notably, the NIH budget proposal also asks Congress to stop restricting how the NIH sets indirect cost rates.
— Downsizing the NIH. The budget plan suggests consolidating the agency's 27 institutes and centers into an eight-institute structure, eliminating the National Institute of Nursing Research, the National Center for Complementary and Integrative Health, the National Institute on Minority Health and Health Disparities and the Fogarty International Center, which promotes collaboration with foreign researchers.
— Spending this year's budget. While Tuesday's hearing is about the 2026 budget, Bhattacharya is likely to be questioned about this year's budget, too.
During a May 29 meeting with disease advocacy organizations, Bhattacharya promised to fully utilize the NIH's fiscal 2025 budget. But with billions of dollars in grants terminated or delayed since Trump was inaugurated, researchers and NIH staffers worry the 2025 budget won't get spent before the fiscal year ends Sept. 30.
WHAT WE'RE READING
POLITICO's Juan Perez Jr. reports on how President Donald Trump has universities in the bind the right has long wanted.
Reuters' P.J. Huffstutter reports on how the Trump administration's aid cuts are straining food banks in Ohio.
The Washington Post's Erin Blakemore reports on new research that could explain why the human brain has such large storage capacity.
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