Late yesterday evening, the Senate voted 60-40 to advance legislation to end the government shutdown, which entered its 41st day this morning. 

Key Takeaways  


• The bill that advanced last night funds federal agencies through January 30, 2026. 

•  Federal workers will be repaid, and shutdown firings are prohibited. 

• Eight Senate Democrats broke ranks with Senate Minority Leader Chuck Schumer (D-NY) to advance the bill. 

• Speaker Mike Johnson (R-LA) wants the House will to pass the bill and send it to the President’s desk by Wednesday. 

• To win Democratic votes, Senate Majority Leader John Thune (R-SD) agreed to hold a vote on enhanced Obamacare tax credits before the end of the year. 

• There is still no requirement that the House vote on the health care credits. 

• Speaker Johnson could be compelled to bring up the bill in the coming months if the White House weighs in, or if 218 Members discharge the bill. 

• House conservatives remain opposed to extending the subsidies. 

• The new deadline means health care negotiations could take place after the enhanced credits expire and higher rates hit on January 1, 2026. 

Eight Democratic Senators voted with all Republicans except Senator Rand Paul (R-KY) to advance the bill: Senators Catherine Cortez Masto (D-NM), Dick Durbin (D-IL), John Fetterman (D-PA), Maggie Hassan (D-NH), Tim Kaine (D-VA), Angus King (I-ME), Jacky Rosen (D-NV), and Jeanne Shaheen (D-NH). 

Details of the Agreement 

H.R. 5371, the Continuing Appropriations and Extensions Act of 2026 will temporarily fund the government through January 30, 2026, at FY 2025 base levels with increases for a number of programs including defense, veterans' affairs, and health programs. Spending contained in the bill totals $1.665 trillion on an annual basis. The continuing resolution (CR) increases spending by $72 billion over the FY 2025 level of $1.592 trillion.  

The legislation also provides full back pay for furloughed federal workers and prohibits any firings from reductions in the federal workforce during the shutdown. With the newest CR expiring in two and a half months, Congress still has much to do to finish the appropriations process and could be in the same position entering February 2026.  

In exchange for voting to end the filibuster and allow the government to reopen, the negotiated deal includes the following provisions.  

• Three full-year appropriations bills will be included (Agriculture, Military Construction/Veterans Affairs, and Legislative Branch), guaranteeing funding through September 30, 2026. 

• Full funding for the Supplemental Nutrition Assistance Program (SNAP) so that funding for food stamps benefits is off the table as a pressure point in any government funding debate in January. 



• Senate Majority Leader Thune committed to holding a vote on extending expiring Affordable Care Act (ACA) enhanced premium tax credit subsidies in December – the latest is that it’s expected by the second week of the month. 

Next Steps for Congress to Reopen the Government 

The Senate will vote this week on the January 31, 2026 CR and the three full-year appropriations bills later this week. In order to move directly to a vote on the bill, the Senate would need a unanimous consent agreement without any objections. Some Senate Democrats have indicated they will use all debate time available to protest, which is expected to delay an end to the shutdown. H.R. 5371 will need a simple 50-vote majority to pass in the Senate. 

The new bill will then go to the House. Speaker Johnson said this morning that the House will be back in session this week and has called on all House members to return to Washington, D.C. The bill will likely be subject to a rule in the House that will provide for one to three hours of debate on the floor and no amendments. If Democrats throw up parliamentary hurdles, the bill should pass the House by Thursday at the latest. 

Speaker Johnson has said he will swear in newly elected Representative Adelita Grijalva (D-AZ) when the House returns, meaning the House can only lose two votes and still pass legislation without any Democratic support (Speaker Johnson expressed confidence on Monday that the House will pass the bill, and the agreement has the President’s support). The expectation is that some Democrats will support the bill. But it bears watching to see whether House Minority Leader Hakeem Jefferies (D-NY) will whip his conference against the bill or simply oppose the bill and allow Members to vote their conscience. Democrats in the House facing competitive elections next year may be inclined to support the bill.  

What This Means and What Questions Remain 

On its face, the capitulation by handful of Democrats is a win for Senate Republican leadership and a loss for Senate Minority Leader Schumer, who did not secure guaranteed passage of ACA enhanced tax credits in this bill and lost eight Democrats who – as we suspected – made a deal that leadership did not support.  

With the expectation that delayed economic reports will reflect the negative impact of the shutdown, Republicans can at least attempt to blame Leader Schumer for repeatedly voting to keep the government closed.  

With regard to the enhanced ACA tax credits, however, Democrats may still win the day. We believe that there will be a negotiated extension in the Senate that will achieve the Democrats’ goal of extending the subsidies. In the House, Republicans have not promised a similar vote on the ACA subsidies. Conservatives are still opposed to the legislation and Speaker Johnson does not have to bring up the bill. As an alternative, 218 Members of the House could push the bill to the floor through a discharge petition. This would require at least two Republicans to join Democrats.  

President Trump could also compel Republicans in the House to bring up the bill down the road. Ultimately, the President’s interest is in seeing lower rates on the exchanges next year. If rates go up, even with $35 billion in additional 2026 spending, the President will be less inclined to force the hand of House Republicans. Look for Trump to pressure insurance companies to pledge to lower rates before any extension of ACA subsidies is signed into law. We’ll have more on those negotiations soon.  

As always, if you have questions about these or any other policy topics and would like to schedule a meeting or call with Marc and Andy, please email us.