HHS Announces “Dramatic Restructuring”

On March 27, 2025, HHS announced a “dramatic restructuring” of its various agencies and offices in accordance with President Trump's Executive Order, “Implementing the President’s ‘Department of Government Efficiency’ Workforce Optimization Initiative.” HHS also published a Fact Sheet.

According to HHS, the restructuring will include a reduction in workforce of about 10,000 full-time employees resulting in taxpayer savings of $1.8 billion per year. According to a Wall Street Journal report, the cuts will result in a reduction of nearly 20% of the workforce of both the Food and Drug Administration (FDA) and the Centers for Disease Control and Prevention (CDC). These terminations are in addition to the roughly 10,000 employees who opted to leave HHS since Trump took office through voluntary separation offers.

The specifics of the restructuring plan that have been announced so far include the following, though many questions remain unanswered:

Regional Offices. The plan will reduce the number of regional offices in half -- from ten to five. HHS regional offices directly serve state and local organizations to address the needs of communities and individuals served through HHS programs and policies.

Consolidation of Divisions and Personnel Cuts. The restructuring plan will consolidate the 28 divisions of HHS into 15 new divisions and will centralize core functions such as Human Resources, Information Technology, Procurement, External Affairs, and Policy. Specifically:

• Creating the Administration for a Healthy America (AHA), which will combine multiple agencies — the Office of the Assistant Secretary for Health (OASH), Health Resources and Services Administration (HRSA), Substance Abuse and Mental Health Services Administration (SAMHSA), Agency for Toxic Substances and Disease Registry (ATSDR), and National Institute for Occupational Safety and Health (NIOSH) — into a new consolidated entity.
  • According to the HHS Fact Sheet, AHA will include divisions related to Primary Care, Maternal and Child Health, Mental Health, Environmental Health, HIV/AIDS, and Workforce. However, this would appear to leave out many existing functions of the agencies merged into AHA, such as the 340B drug discount program, organ and tissue donation regulation, and countermeasure and vaccine injury compensation programs, all administered by HRSA.
  • Currently, OASH and SAMHSA, led by individuals at the Assistant Secretary level, and HRSA, led by an Administrator, report directly to the Secretary of HHS, while ATSDR and NIOSH are led by the CDC Director. It is unclear how the AHA will be structured, or if one official will be leading the AHA.
• Consolidating NIH procurement, human resources, and communications operations across 27 institutes and centers.
  • With ongoing concerns about a lack of communication between NIH and stakeholders corresponding with a slowdown in grantmaking and cancellation of awards, this reorganization may lead to additional delays.
• Cutting 3,500 staff from FDA, focusing on streamlining operations and centralizing administrative functions. HHS asserted this will not affect drug, medical device, or food reviewers or inspectors.
  • HHS did not describe in detail how it would define “reviewers or inspectors.” Notably, the HHS Fact Sheet did not say that reviewers at the Center for Tobacco Control or professionals responsible for cosmetics regulation would be spared from job cuts, despite recent bipartisan support from Congress for additional staff in these areas.
• Refocusing CDC’s mission to “preparing for and responding to epidemics and outbreaks.”
  • CDC’s current mission is broader, focusing on “protect[ing] America from health, safety, and security threats, both foreign and in the U.S.,” including chronic disease. Given Secretary Kennedy’s focus on chronic disease, these functions may now be taken over by AHA. However, the HHS announcement does not detail any transfers of personnel or authority from CDC to AHA.
• Moving the Administration for Strategic Preparedness and Response (ASPR), which is responsible for national disaster and public health emergency response, under the purview of the CDC.
  • It is unclear how this reorganization will affect the organization of ASPR, which is headed by the Assistant Secretary for Preparedness and Response, a position required by statute to report directly to the Secretary, rather than to the CDC Director.
  • ASPR houses the Strategic National Stockpile (SNS) and the Biomedical Advanced Research and Development Authority (BARDA). Both agencies specialize in issuing contracts and grants related to preparedness for public health emergencies and protecting the public against chemical, biologic, radiological, and nuclear threats. With HHS announcing that the restructuring will centralize procurement authorities, questions remain about what contracting authorities will continue to be housed at ASPR.
• Creating a new position, the Assistant Secretary for Enforcement, to oversee the Departmental Appeals Board (DAB), Office of Medicare Hearings and Appeals (OMHA), and Office for Civil Rights (OCR) to “combat waste, fraud, and abuse in federal health programs.”
  • In addition to enforcement authorities, OCR has policymaking and regulatory roles, including related to health privacy. The HHS announcement did not say whether these roles will remain with OCR under the new Assistant Secretary for Enforcement.
  • Another key enforcement position at HHS resides with the Office of Inspector General (OIG). OIG was not included in the announcement of the Assistant Secretary for Enforcement.
• Merging the Assistant Secretary for Planning and Evaluation (ASPE) with the Agency for Healthcare Research and Quality (AHRQ) to create the Office of Strategy to “enhance research that informs the Secretary’s policies and improves the effectiveness of federal health programs.” The AHRQ is responsible for surveilling the practice of medicine and patient safety and helped inform critical decision-making at other agencies including CMS, FDA, NIH, and CDC, while ASPE typically examines high-level policies that may affect various HHS programs.
• Merging several critical programs that support older adults and people with disabilities, currently housed at the Administration for Community Living (ACL), with other HHS agencies, including the Administration for Children and Families (ACF), ASPE, and the Centers for Medicare and Medicaid Services (CMS).
• Regarding CMS, HHS states that “CMS will decrease its workforce by approximately 300 employees, with a focus on reducing minor duplication across the agency.”
  • HHS also states that “[t]his reorganization will not impact Medicare and Medicaid services.” However, questions remain about how Medicare and Medicaid would be insulated from these changes. For example, Medicare and Medicaid operations could be directly impacted by lack of resources due to the consolidation of regional offices, and there may be indirect impacts from changes to HHS components that provide services to Medicare and Medicaid (e.g., DAB, OMHA, and OCR).

The announcement did not include mention of the Assistant Secretary for Technology Policy/Office of the National Coordinator for Health Information Technology (ASTP/ONC), which underwent its own reorganization just last year, nor did it discuss the Advanced Research Projects Agency for Health (ARPA-H) or the Indian Health Service, both of which appear to remain as separate operating divisions at HHS. It may be that additional changes are announced as HHS seeks additional opportunities to “streamline its operations and budgets.”

Crowell will continue to monitor details of the HHS restructuring as they become available.