Here are eight things to know about how recent federal funding cuts have affected academic medical centers:
1. On April 4, a federal judge in Massachusetts issued a permanent injunction to block the Trump administration’s proposal to limit medical research funding. The federal government plans to appeal the decision, setting up a longer legal battle over the future of research grant policy.
2. U.S. District Judge Angel Kelley initially issued a temporary restraining order in February to halt a proposed policy from the National Institutes of Health to cap reimbursements for research overhead costs to universities and academic medical centers at 15%.
3. The order was extended twice until the final ruling on April 4, setting the stage for a longer legal battle over NIH contracts. The Trump administration had requested the court to enter the verdict April 4 so that it can move forward with an appeal.
4. On the same day, 16 state attorneys general filed a federal lawsuit to challenge the Trump administration’s abrupt termination of NIH research grants. The suit alleges the administration unlawfully revoked millions in funding for previously approved studies, including those focused on substance abuse, Alzheimer’s disease and vaccine hesitancy, by deeming them “misaligned” with the agency’s priorities. Plaintiffs argue the funding terminations threaten public health by disrupting research and clinical trials, and urge the court to order the administration to restore grants and resume NIH’s standard review process.
5. The proposed cap was criticized by the medical research community among hospitals and medical schools, who warned that the cap would slow scientific progress and limit patient access to clinical trials and groundbreaking treatments.
6. While the cap is temporarily blocked, each of the top 20 highest-funded medical schools have indirect cost rates well above the 15% cap proposed by the Trump administration in February. When institutions receive federal funding for a medical research project, they also receive a percentage for indirect costs, which cover expenses such as lab operations and supplies. The University of California, San Francisco, Washington University in St. Louis and Yale University in New Haven, Conn., were the top three recipients of NIH funding in 2024.
7. In 2024, NIH spent around $32 billion on nearly 60,000 grants that included medical research areas such as cancer, genetics and infectious disease. Of that, $23 billion went to direct research costs, such as researchers’ salaries, and the other $9 billion went to indirect costs, which can include laboratory upkeep, utility bills, administrative staff and access to hazardous materials disposal. These indirect costs are essential to making research happen. The 15% cut in overhead costs would reduce funding by at least $5 billion.
8. On March 25, HHS canceled more than $12 billion in grants to state health departments that supported efforts to rack infectious diseases, expand mental health services and modernize outdated systems.
