Deep cuts in NIH funding will increase long-term health care costs

As the Trump administration proposes to reduce 40% of the 2026 National Institutes of Health (NIH) budget, a new analysis warns that these cuts could undermine scientific advances, weaken the biomedical workforce and increase long-term health care costs.

The study was published on July 25 JAMA Health Forumusing system modeling to highlight feedback loops that may turn short-term savings into long-term setbacks.

Beyond the budget line

NIH supports more than 2,500 research institutions and fundes the vast majority of biomedical research in the United States. However, recent moves have limited indirect costs, removing grants referring to diversity and public health issues and delaying new awards have undermined the agency’s core mission. According to the authors, the real danger lies not only in direct impact, but also in how these cuts trigger a ripple effect across science, medicine and economics.

How budgets cut corrugation across the entire system

The author of the study – dr. Mohammad Jalali and Zeynep Hasgul used a causal ring diagram to plot interlock dynamics. Their model suggests that the effect of cuts may be more than just narrowing the NIH footprint. They can reshape the entire landscape of biomedical research. Here are the four enhanced cycle analysis identified:

• Slower scientific advancements: Reducing funding for basic research may delay or prevent significant discoveries, such as genomic efforts that lead to cancer immunotherapy.
• Labor Erosion: Due to the small training grants, laboratories may lose talent. In the NIH grant lab, a 40% increase in unemployment was observed.
• Increased treatment costs: With private companies in progress, innovation may shift to high-profit drugs that may inflate health care costs.
• Lost public health savings: Less investment in prevention and early screening may mean more expensive late-stage interventions in the future.

“Short-term cuts, long-term costs”

“Without the basic research on NIH investment, breakthrough discoveries could be significantly delayed or deprived due to the lack of immediate profitability,” the authors noted. They pointed out that the Human Genome Project and the NIH brain initiatives are examples of transformative results in long-term public investment.

NIH funds not only support laboratory science, but also drive economic activity. In 2024 alone, it generated an estimated $94.58 billion in new output and supported more than 400,000 jobs. The authors warn that reducing the backlash of the engine can weaken the regional economy and reduce future tax revenues.

Change the innovation model

There is also a deeper ideological shift. Analyzing questions, are these budget decisions reflect temporary austerity measures or a permanent hub from publicly funded scientific funding. If the latter, the United States may move towards a more fragmented system that relies on venture capital, philanthropy and market priorities, then this ecosystem is less conducive to high-risk, high-reward research.

“Public investment in biomedical research is not only a budgetary decision; it is an investment in human health, lifespan and quality of life,” the authors wrote. They warn that scaling now can cut scientific leadership to maintain stable publicly funded countries.

What’s next?

The framework provided by this study does not prescribe specific policy solutions, but it does provide a roadmap for understanding trade-offs. By outlining the hidden feedback loop, the authors hope to help policy makers, researchers and economists expect the unexpected consequences of NIH default.

Regardless of whether the proposed cuts pass or not, the study urges a broader dialogue on the value of public science and the value lost.

Journal Reference

Jalali MS, Hasgul Z. Potential trade-offs for proposed cuts NIH. JAMA Health Forum. Published online on July 25, 2025; 2025; 6(7): E252228. doi:10.1001/jamahealthforum.2025.2228

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