2025 Full-Year Spending Bill with Extensions and Cuts

What to know

• The bill sets aside $261 billion early to pay Medicaid grants to states for the first three months of fiscal year 2026.
• About $1.43 billion in unspent defense funds is permanently cancelled across 18 Army, Navy, Air Force, and Space Force accounts.
• Medicare telehealth rules are extended six more months, through September 30, 2025. Patients can still get care from home or by phone-only calls.
• The Small Business Administration's disaster loan program gets $406 million, up from $165 million. Of that, $374 million is marked as emergency spending for federally declared disaster areas.
• The Department of Veterans Affairs gets firm funding for 2026, including $75 billion for medical services and about $227 billion for compensation and pensions.
• Starting May 15, 2025, the Office of Management and Budget must send Congress monthly spending reports. The reports compare each agency's spending to the same period in fiscal year 2024.

Heads up

7 buried provisions

Provisions we flagged do not match the bill's stated purpose, or repeat language from bills that did not pass on their own.

Section by section

1. Advance payments for mandatory benefit programs in early fiscal year 2026

   Section 1109 covers two things. First, it says that mandatory payment programs funded through 2024 appropriations laws will keep running at whatever level current law requires. Second, it sets aside specific dollar amounts as early payments for five benefit programs to cover the first three months of fiscal year 2026. Those amounts are: $6 million for disabled coal miners' benefits, $261 billion for Medicaid grants to states, $1.6 billion for child support and family support programs, $3.6 billion for foster care payments, and $22.1 billion for Supplemental Security Income (a cash benefit program for low-income people who are elderly, blind, or disabled). Most of these funds stay available until spent.

   Who this affects

   People who receive Medicaid, foster care support, child support, Supplemental Security Income, or disabled coal miner benefits are affected. States and other groups that administer these programs are also affected.

   Tradeoff

   Sending these payments early ensures benefits keep flowing without interruption at the start of fiscal year 2026, but it also commits large sums of federal money before the next full budget is passed.

   Show the exact bill text

   the following amounts shall be available for the following accounts for advance payments for the first quarter of fiscal year 2026: (1) ``Department of Labor--Office of Workers' Compensation Programs--Special Benefits for Disabled Coal Miners'', for benefit payments under title IV of the Federal Mine Safety and Health Act of 1977, $6,000,000, to remain available until expended. (2) ``Department of Health and Human Services--Centers for Medicare & Medicaid Services--Grants to States for Medicaid'', for payments to States or in the case of section 1928 on behalf of States under title XIX of the Social Security Act, $261,063,820,000, to remain available until expended.

2. Monthly spending reports to Congress

   Section 1114 requires the Office of Management and Budget (OMB) to send reports to Congress about how federal agencies are spending money in fiscal year 2025. The first report is due by May 15, 2025. After that, reports must come every month through November 1, 2025. Each report must show spending broken down by account. It must also compare that spending to the same time period in fiscal year 2024. This applies to all departments and agencies funded under this continuing resolution.

   Who this affects

   Federal agencies that receive funding under this act. Members of the House and Senate Appropriations Committees receive the reports.

   Tradeoff

   Regular reporting gives Congress more visibility into agency spending, but it also adds reporting work for OMB and agency staff.

   Show the exact bill text

   Not later than May 15, 2025, and each month thereafter through November 1, 2025, the Office of Management and Budget shall submit to the Committees on Appropriations of the House of Representatives and the Senate a report on all obligations incurred in fiscal year 2025, by each department and agency, using funds made available by this division.

3. Defense spending rescissions

   Section 1416 permanently cancels, or 'rescinds,' previously approved defense funding that was never spent. The cancellations cover 18 specific accounts, including the Afghanistan Security Forces Fund, aircraft procurement for the Army, Navy, and Air Force, Navy ship research and development, Space Force procurement, and several research and testing programs. The total amount cancelled across all accounts is roughly $1.43 billion. Once rescinded, these funds are gone and cannot be used for any purpose.

   Who this affects

   The Department of Defense and its branches (Army, Navy, Air Force, Space Force) lose access to previously approved but unspent funds. Contractors or programs waiting on those funds would no longer receive them.

   Tradeoff

   Cancelling unspent funds reduces the federal deficit, but it also eliminates money that could have been used for defense programs or equipment.

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   The following amounts are permanently rescinded: (1) ``Afghanistan Security Forces Fund'', 2022/2025, $80,000,000; (2) ``Aircraft Procurement, Army'', 2023/2025, $25,000,000;

4. Small Business disaster loan funding increase

   This section sets the total funding for the Small Business Administration's Disaster Loans Program at $406 million. That is higher than the $165 million level set in the prior spending law. Of that total, $374 million is set aside specifically for areas hit by major federally declared disasters. Congress labels that $374 million as emergency disaster relief money, which means it can be spent outside normal spending caps.

   Who this affects

   Homeowners, renters, and businesses in areas struck by major federally declared disasters who apply for SBA disaster loans.

   Tradeoff

   More money is available for disaster recovery loans, but the bulk of the funding is counted as emergency spending, which adds to the deficit without being offset by cuts elsewhere.

   Show the exact bill text

   the level for ``Small Business Administration--Disaster Loans Program Account'' shall be $406,000,000: Provided, That the amounts included under such heading in division B of Public Law 118-47 shall be applied by substituting ``$396,000,000'' for ``$165,000,000''

5. Wildfire suppression reserve funds

   Section 1806 sets aside money in two separate wildfire reserve funds. The Department of the Interior gets $360 million. The Department of Agriculture's Forest Service gets $2.39 billion. Both amounts are labeled as additional new budget authority. That label matters because it lets these funds be treated as emergency spending under a federal budget law called the Balanced Budget and Emergency Deficit Control Act of 1985. That law controls how spending limits are enforced.

   Who this affects

   Federal land managers and firefighting crews who respond to wildfires on Interior and Forest Service lands. Taxpayers fund these reserves.

   Tradeoff

   Setting aside this money ensures funds are available when large wildfires occur, but it adds to federal spending by designating these amounts outside normal budget caps.

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   the level for ``Department of Agriculture--Forest Service--Wildfire Suppression Operations Reserve Fund'' shall be $2,390,000,000 for additional new budget authority as specified for purposes of section 251(b)(2)(F) of the of the Balanced Budget and Emergency Deficit Control Act of 1985.

6. Veterans Affairs funding levels for fiscal year 2026

   Section 11109 sets specific dollar amounts for seven Department of Veterans Affairs accounts for fiscal year 2026. These funds become available on October 1, 2025. Medical care accounts include $75 billion for direct medical services, $34 billion for community care, $12.7 billion for medical support, and $9.7 billion for medical facilities. A portion of each medical care account stays available through September 30, 2027. Benefits accounts include about $227 billion for compensation and pensions, $20.4 billion for readjustment benefits (such as education and job training), and $131.5 million for veterans insurance. These levels override the general funding formula used elsewhere in the bill.

   Who this affects

   Military veterans who use VA health care, receive disability compensation or pensions, or use education and job training benefits. VA employees and contracted care providers are also affected.

   Tradeoff

   Setting firm, higher funding levels gives the VA more certainty to plan services, but it locks in large spending amounts ahead of the normal annual budget process.

   Show the exact bill text

   $75,039,000,000 for ``Department of Veterans Affairs--Medical Services'', which shall become available on October 1, 2025, and of which $2,000,000,000 shall remain available until September 30, 2027.

7. Medicare telehealth flexibilities extended through September 2025

   This section pushes back the end date for several Medicare telehealth rules from March 31, 2025, to September 30, 2025. Under these rules, Medicare patients can receive telehealth visits from home instead of only from approved locations. More types of health care providers can deliver telehealth services. Federally Qualified Health Centers and Rural Health Clinics can keep offering telehealth visits. Mental health patients do not yet need to meet their provider in person before switching to telehealth. Patients can use audio-only (phone-only) calls for telehealth visits. Hospice patients can have an eligibility check done by telehealth. All of these rules were set to expire in March 2025. This section keeps them running for six more months.

   Who this affects

   Medicare patients who use telehealth, including those in rural areas, those seeking mental health care, and hospice patients. It also affects doctors, nurses, therapists, and clinics that provide telehealth services.

   Tradeoff

   Patients keep easier access to telehealth for six more months, but the government pays for more remote visits during that time, which increases Medicare spending.

   Show the exact bill text

   in paragraph (2)(B)(iii), by striking ``ending March 31, 2025'' and inserting ``ending September 30, 2025''