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Government Affairs - Issues

Budget/Appropriations Archives

 

Congress Approves Omnibus Spending Bill, Includes an Increase for NIH

On December 16th President Barak Obama signed an omnibus spending package into law.  The package, which both the House and Senate had passed largely along partisan lines includes six of the seven regular FY 2010 appropriations bills that have yet to be enacted.  The conference agreement includes the Transportation-Housing and Urban Development bill (H.R. 3288), which serves as the legislative vehicle for the package; and the Labor-HHS-Education, Military Construction-Veterans Affairs, Commerce-Justice-Science, Financial Services-General Government, and State- Foreign Operations bills. The vote was 221-202 in the house and 57-35 in the Senate.

Division D of the conference agreement includes $163.6 billion in discretionary spending for programs under the Labor-HHS-Education bill (H.R. 3293), an increase of $8.5 billion (5.5%) over the FY 2009 bill, excluding emergency appropriations.  This includes $48.5 billion for programs in the Public Health Service, an increase of $1.1 billion (2.4%) over FY 2009.   Included in Division D are:

National Institutes of Health (NIH): For NIH, the conference agreement includes $31.0 billion, an increase of $691.8 million (2.3%) over the FY 2009 bill, and $250 million more than the president's request.  The conference agreement includes legislative language proposed by the Senate requiring the Secretary of Health and Human Services to amend regulations by May 1, 2010, regarding financial conflict of interest among NIH extramural investigators and institutions.  The conferees expressed concern "that occurrences of conflict of interest among extramural grantees are investigated only when a complaint is received by the Department of Health and Human Services Office of Research Integrity.  The conferees encourage NIH to develop a system for periodic review of conflict of interest documentation at extramural institutions to give some assurance that the new conflict of interest regulations have an effect."

Report language accompanying the conference agreement notes that the final bill includes funding for a 1% increase in research training stipends instead of the 2% increase proposed by the House.  The Senate did not identify a specific stipend increase.

The conference agreement also:

  • continues language from previous years' appropriations bills setting the limit on salaries of researchers through NIH grants at Executive Level I ($196,700 in 2009);
  • includes $193.9 million to continue the Children's Health Study; and
  • provides $5 million for a bioethics initiative proposed by the House.

Health Professions: The conference agreement provides $254 million for Title VII health professions programs, a $32 million (14.4%) increase over FY 2009, but $11 million less than the president's request.  The funding level falls between the House-approved level of $266 million and the Senate committee level of $243 million.  The bill includes increases for every Title VII program except the faculty loan repayment program, for which funding remains flat.  The omnibus also includes $2.8 million for the workforce information and analysis program, which has not received funding since FY 2005.

The conference agreement provides $244 million for Title VIII nursing education programs, a $73 million (42.6%) increase over FY 2009, and a $22 million increase over the Senate committee bill.  The funding level is $19 million below both the president's request and the House-approved bill, which each provided $263 million for Title VIII.

National Health Service Corps (NHSC): The conference agreement provides $142 million for the NHSC, a $7 million (5.1%) increase over FY 2009, as proposed in both the House and Senate bills.  The president's request proposed $169 million for NHSC.

Agency for Healthcare Research and Quality (AHRQ): The conference agreement provides $397 million for AHRQ, a $25 million (6.3%) increase over FY 2009, the president's request, and the House and Senate bills.

Within the total, the bill provides $25 million under "Patient Safety Research and Health" for healthcare-associated infections prevention activities and $25 million for patient safety and medical liability reform demonstrations.  According to the accompanying report, the funding will support "a three-pronged initiative consisting of demonstration grants to States and health systems to test implementation and evaluation of evidence-based patient safety and medical liability projects, grants to States and health systems to plan for implementation and evaluation of evidence-based patient safety and medical liability demonstrations, and a rapid and comprehensive review of initiatives that improve health care quality and reduce liability."

The conference agreement also includes $24 million for "investigator-initiated research" and $21 million for "Patient-Centered Health Research," funded at $50 million in FY 2009 under the heading "Clinical Effectiveness Research."

Children's Hospitals Graduate Medical Education: The conference agreement includes $317.5 million for the Children's GME program, a $7.5 million (2.4%) increase over FY 2009 and the president's request. The House bill included $320 million for the program, while the Senate committee provided $315 million.

Centers for Disease Control and Prevention (CDC): The conference agreement provides $6.8 billion for CDC, a $128 million (1.9%) increase over FY 2009, $60 million more than the House, and $31 million less than the Senate.  The president's request included $6.7 billion for CDC.

             

Other divisions of the bill included funding for health and science programs.

Veterans Affairs (VA) Medical Care and Research Funding: The conference agreement includes $44.5 billion for VA medical care, a $4 billion (10%) increase over FY 2009.  For the first time, the conference agreement includes advanced appropriations for FY 2011 medical care at $48.2 billion, a $3.7 billion (8.3%) increase over FY 2010.

The agreement provides $581 million for VA Medical and Prosthetics Research, a $71 million (13.9%) increase over FY 2009.  Conferees added $1 million over the House and Senate bills for research on Gulf War Veteran's illness.

National Science Foundation (NSF): The conference agreement provides $6.926 billion for NSF, a $436 million (6.8%) increase over FY 2009, but $145 million below the president's request of $7.045 billion.  The House bill (H.R. 2847) provided $6.937 billion, while the Senate's version of the bill included $6.917 billion.

Within the total, the omnibus includes the Senate-proposed $5.618 billion for research and related activities, a $435 million (8.3%) boost over FY 2009, but $115 million below the president's request of $5.733 billion.  The House bill provided $5.642 billion for research and related activities.


Speaker Pelosi Helps Launch AAU-APLU-TSC Initiative

House Speaker Nancy Pelosi (D-CA) headlined a Capitol Hill press conference on November 17th at which the Association of American Universities (AAU), the Association of Public and Land-grant Universities (APLU), and The Science Coalition (TSC) announced the launch of ScienceWorksForUS, their joint initiative to inform the public of the benefits of the Recovery Act research investment.  The focus of the project is a website (www.ScienceWorksForUS.org) that highlights Recovery Act-sponsored research in all 50 states.

Speaker Pelosi was joined at the press event by Representative Rush Holt (D-NJ), House Science and Technology Committee Chairman Bart Gordon (D-TN), and Representatives Ed Markey (D-MA) and Bill Foster (D-IL), as well as University of Arizona President Robert Shelton.  Also participating were University of Pennsylvania Vice Provost for Research Steven Fluharty, Rutgers Vice President for Research Michael Pazzani, Ohio State Vice President for Research Caroline C. Whitacre, and researchers from Princeton and Johns Hopkins. 

  

In her remarks, the Speaker said, “ScienceWorksForUS is leading the way in tracking our achievements in science and lighting the way to a greater commitment to research.  The website ScienceWorksForUS.org—which highlights the way Recovery Act funds have made their way into academic laboratories—reflects what’s possible when smart investments in the public sector are placed in the hands of our scientists, innovators, and academies of higher learning.  This initiative is built on a simple fact of our history:  innovation rests at the heart of American success and leadership.”

President Shelton said in his introduction to the event, “The funds for research are part of the reinvestment the nation must make to grow a strong economy that is based on addressing 21st century challenges, including improving health and meeting energy needs in ways that help slow climate change. The result will be an economy that produces well-paying jobs for the long-term."

ScienceWorksForUS is intended to be a two-year project, so the three associations will ask their member campuses to continue to provide the project with information about their Recovery Act-funded research grant totals, press releases, news stories, and links to their own university Recovery Act websites.


Senate Panel Approves HHS Spending Bill

On July 30th, the Senate Appropriations Committee approved 29 - 1 its version of the FY 2010 Labor-HHS-Education Appropriations bill (H.R. 3293) two days after the corresponding subcommittee approved the spending bill by voice vote.  In a July 28th statement, Subcommittee Chair Tom Harkin (D-IA) referenced $10.4 billion for NIH and other funding provided in the American Recovery and Reinvestment Act (ARRA, P.L. 111-5) as "a major factor in shaping this bill."  He described that the committee's bill "instead emphasizes several other important programs" that did not receive substantial ARRA funding.

 

National Institutes of Health (NIH): According to a summary released by the committee, the bill includes the President's request of $30.8 billion for the NIH, a $442 million increase over the FY 2009 level.  This total includes $300 million to be transferred from NIH to the Global Fund to Fight HIV/AIDS, Malaria, and Tuberculosis.

The Senate Committee's bill concurs with the House-passed version in rejecting the Administration's proposal to earmark increases for cancer and autism research.  The committee report accompanying the bill notes "the President's plan would set a dangerous precedent.  The Committee has long subscribed to the view that funding levels for individual diseases should be determined without political interference."The House-approved version of the bill (H.R. 3293) provides $31.3 billion for NIH, $500 million more than the Senate and the President's request.

Health Professions: The Senate committee provides $460.1 million for the Title VII and Title VIII health professions programs, a $67.4 million (17.2%) increase over FY 2009, and $68 million less than the President's budget request.  For Title VII, the bill provides $243.4 million, a $21.7 million (9.8%) increase over FY 2009.  The bill includes the President's proposed increases for the Title VII Centers of Excellence and Health Careers Opportunity Program, and also increases funding for the Primary Care Medicine and Dentistry program.  The bill also provides $5.7 million for Title VII Health Professions Workforce Information and Analysis; the program has received no funding since FY 2005, when it was funded at $716,000.The House-approved bill provides $529.7 million for the health professions programs, including $266.3 million for Title VII.

National Health Service Corps (NHSC): Like the House, the Senate committee's bill provides $142 million for the NHSC, a $7 million (5.2%) increase over FY 2009 and $27 million less than the President proposed.

Agency for Healthcare Research and Quality (AHRQ): The bill provides $372.1 million for AHRQ, as provided in FY 2009, the President's budget, and the House-approved bill.

Children's GME: The bill provides $315 million for the Children's Hospitals Graduate Medical Education program, $5 million (1.6%) more than FY 2009 and the President's request. The House-approved bill provides $320 million for the program.

Centers for Disease Control and Prevention (CDC): The bill provides $6.828 billion in program level funding for CDC, a $158.9 million (2.4%) increase over FY 2009, and $130 million more than the President's request. The House bill provides $6.737 billion in program level funding for CDC.

No date has been set for Senate floor consideration of the bill.


House Appropriations Subcommittee Approves FY10 Labor-HHS-Education Bill – Increases NIH Budget by $942 Billion

On July 10th, the House Labor-HHS Appropriations Subcommittee approved the FY 2010 Labor-Health and Human Services-Education Appropriations bill.  The bill includes a $6.037 billion increase over FY 2009 for the Department of Health and Human Services (HHS), which is $1.953 billion over President Obama's FY10 request.

Of special note, the bill appropriates $30.967 for the National Institutes of Health, an increase of $500 million over the President Obama’s request, and $942 million (3.1%) over FY09.   A statement from Appropriations Committee Chair David Obey (D-WI) indicates that the Subcommittee is "rejecting the Administration's targeted funding approach and ensuring that all institutes and centers receive funding to offset biomedical research inflation."

According to the statement by Chairman Obey, the bill provides "$530 million in HRSA to expand training programs across the health professions and nursing fields, which provides a 34.9% increase over 2009, and the same amount as the request."  The legislation also includes $6.643 billion for the Centers for Disease Control and Prevention for public health activities.  This represents a $67 million increase over FY09. According to the Chairman's statement, the Subcommittee has also dedicated "$204 million across HHS to continue the Subcommittee's aggressive campaign to dramatically reduce life-threatening hospital infections," which contribute to many deaths and increased health care costs for Americans.


White House Unveils Detailed FY 2010 Budget Request

In early May, President Obama revealed agency and program specific details of his FY 2010 budget.  The budget proposal is normally unveiled in early February, but with the inauguration of a new President in January, the release was pushed back.  The Office of Management and Budget (OMB) also released a list of terminations, reductions, and savings, highlighting the programs that the Administration proposes to eliminate or scale back.

In February, OMB did release a budget overview, laying out the Administration's priorities and the broad outlines of the budget.  The February documents did not include discretionary program information, nor did they address details on several of the Administration's mandatory and tax policies, such as the international tax and tax compliance initiatives.  This budget fills in those details.

What follows is a summary of discretionary spending proposals of interest to academic medicine.

National Institutes of Health: The President's budget calls for an FY 2010 program level of $30.996 billion for NIH.  This is an increase of $443 million (1.5%) over the FY 2009 comparable number and excludes funding provided to NIH through the American Recovery and Reinvestment Act (ARRA, P.L. 111-5).  

The NIH program level includes $150 million for Type I Diabetes research, $79 million in funding transferred from the Interior appropriation to NIH for Superfund research activities through the National Institute of Environmental Health Sciences (NIEHS), and $8 million in Public Health Service evaluation funds transferred to the National Library of Medicine.

Identified as strategic priorities, the President's budget plans to invest over $6 billion for cancer research across NIH, reflecting the first year of an eight year strategy to double cancer research by FY 2017.  The FY 2010 request represents an increase of $268 million (5%) over the estimated FY 2009 level in this area.  The budget also includes $141 million for NIH's share of a $211 million HHS-wide initiative on autism spectrum disorders that also encompasses the Centers for Disease Control and Prevention (CDC) and the Health Resources Services Administration (HRSA) in FY 2010.  For NIH, this represents an increase of $19 million, or 16% above the estimated FY 2009 level.  The budget also includes a $9 million increase to NIEHS for a new initiative to support nanotechnology safety research, and $5 million from the Office of the Director to launch a new effort in bioethics, which will be funded in coordination with the Institute and Centers (ICs).

NIH estimates the budget would fund a total of 9,849 new and competing renewal research project grants (RPGs), an increase of seven RPGs over the estimated FY 2009 level.  For noncompeting continuation awards, the President's Budget provides inflationary increases of 2%. The average cost of competing RPGs increases by 2% over the FY 2009 level.  Due to the receipt of ARRA funds in FY 2009, NIH temporarily will suspend the NIH Director's Bridge Award program in FY 2010; the vast majority of these funds are redistributed to the ICs.

Health Professions: The President's budget requests $264.7 million for the Title VII health professions training programs, a $43 million (19.4%) increase over the FY 2009 omnibus. Within this total, the request proposes increases for the Health Careers Opportunity Program ($22.1 million, a $3 million or 15.7%), the Centers of Excellence ($24.6 million, a $4 million or 19.4%), the primary care medicine and dentistry training programs ($56.4 million, an $8 million or 16.5%), the geriatric training programs ($42 million, an $11 million or 35.5%), and the Scholarships for Disadvantaged Students ($52.8 million, a $7 million or 15.3%).  The budget request also proposes a $10 million boost for state dental health workforce grants that are authorized in a different part of the Public Health Service Act, but have been funded through the Title VII allied health program since FY 2008.

The budget also proposes a substantial increase for the Title VIII Nursing Education Loan Repayment Program (NELRP), recommending $125 million, an $87.9 million (237%) increase over FY 2009.   The Title VIII Nursing Faculty Loan program also is increased to $16 million, a $4.5 million (39.1%) increase.  The budget proposes funding all other Title VIII programs at FY 2009 levels, yielding $263.4 million for the Title VIII programs in total (a $92.4 million or 54% increase).

The budget identifies the state oral health grants, the Title VIII NELRP and the Faculty Loan program, as well as the National Health Service Corps (NHSC), as part of the President's Health Workforce Initiative.

National Health Service Corps: The President's budget requests $169 million for the NHSC, a $34 million (25.2%) increase over FY 2009.

Agency for Healthcare Research and Quality: The President's budget proposes $372 million for AHRQ, as provided in the FY 2009 omnibus.  The request recommends maintaining AHRQ's base funding for comparative effectiveness research (CER) at $50 million, as provided in the FY 2009 omnibus. ARRA provided $300 million directly to AHRQ for CER, which the HHS "budget in brief" identifies as part of the President's health reform agenda.

Children's Hospitals Graduate Medical Education Program: The President's budget recommends freezing the Children's GME program at the FY 2009 level of $310 million.

Centers for Disease Control and Prevention: The President's budget recommends $6.4 billion in discretionary budget authority for the CDC, the same as the comparable FY 2009 funding level.  Within the total, most programs receive modest increases accommodated primarily through cuts to funds for CDC buildings and facilities, the health marketing program, Congressional projects, and elimination of the Anthrax vaccine research program.  The public health research program is maintained at the FY 2009 level of $31 million.

Department of Veterans Affairs Medical and Prosthetic Research: The President's budget requests $580 million for the program, a $70 million, 13.7% increase over FY 2009.


House Members Call for Increased NIH Funding

A bipartisan group of 128 Members of the House of Representatives sent a letter calling for an increase "of at least 7 percent" in funding for the National Institutes of Health (NIH) in FY 2010.  The letter, which was sent to Reps. David Obey (D-WI) and Todd Tiahrt (R-KS), the chair and ranking member, respectively, of the House Labor-HHS-Education Appropriations Subcommittee, states this level of funding "is essential to sustain advances in science and the economic impacts of NIH-funded research."

             

The letter states, "NIH research is a critical part of health care reform, strengthening our economy, inspiring the next generation of scientists and researchers, and maintaining our nation's leadership in innovation."  Noting that "a substantial portion of projected health care spending comes from expenses associated with managing diabetes, cancer, Alzheimer's, stroke, and many other chronic or life-threatening diseases," the letter avers that NIH research "is essential to containing soaring health care costs."

             

The letter was organized by Reps. Ed Markey (D-MA), Dave Reichert (R-WA), Janice Schakowsky (D-IL), Joe Courtney (D-CT), Michael Castle (R-DE), Susan Davis (D-CA), and Brian Bilbray (R-CA).  Thirteen members of the New York delegation were among those who cosigned the letter.


President Signs FY 2009 Spending Bill

On March 11th, President Obama signed the fiscal year 2009 omnibus spending package (H.R. 1105) into law.  The federal fiscal year had begun on October 1st, but Congress and the President were not able to agree on annual spending bills until almost half way through the fiscal year.

The $410 billion omnibus proposal includes the nine FY 2009 appropriations bills that were not finished by the 110th Congress. The omnibus provides $151.8 billion for programs in the Labor-HHS-Education bill, a $6.7 billion (4.6%) over the FY 2008 comparable funding level. This includes:

  • $30.3 billion for NIH, a $938 million (3.2%) increase
  • $222 million for Title VII health professions programs, a $48 million (14.3%) increase;
  • $372 million for the Agency for Healthcare Research and Quality, a $37.5 million (11.2%) increase; and
  • $135 million for the National Health Service Corps, an $11.5 million (9.3%) increase.

Biomedical Research Big Winner in Stimulus Package

Thanks to Senator Arlen Specter (R-PA) and a strong grass roots effort by patient advocates, scientists, research universities, and academic medical centers, the American Recovery and Reinvestment Act includes $10 billion for the National Institutes of Health (NIH).  Columbia University Medical Center faculty, staff, and students were a big part of this effort, accounting for almost half of all the emails that came in through the Association of  American Medical Colleges advocacy tool website.

The bill provides $10 billion for NIH. Of this amount, $8.2 billion is appropriated to the Office of the Director, with $7.4 billion designated for transfer to the Institutes, Centers, and Common Fund.  The conference agreement adopts the Senate guidance that, to the extent possible, the $800 million retained in the Office of the Director "shall be used for purposes that can be completed within two years, with priority placed on short-term grants that focus on specific scientific challenges, new research that expands the scope of ongoing projects, and research on public and international health priorities."  The conferees also included legislative language that excludes the NIH funds in the recovery package from the set-aside requirements of the Small Business Innovation Research and Small Business Technology Transfer programs.

             

The conference agreement also provides $1.3 billion for the National Center for Research Resources (NCRR), with $1 billion for "competitive awards for the construction and renovation of extramural research facilities" and $300 million for "shared instrumentation and other capital equipment."  The conference agreement includes a House proposal to waive non-Federal match requirements for extramural facilities and a statement that the conferees "expect NCRR will give priority to those applications that are expected to generate demonstrable energy-saving or beneficial environmental effects."  In addition, the conference agreement also provides $500 million for the Buildings and Facilities account to be used for construction and renovation of NIH intramural buildings.

Finally, the bill also includes $1.1 billion for Agency for Health Quality Research to fund comparative effectiveness research.  Of this amount, $400 is to be transferred to the NIH.  This is above and beyond the $10 billion.


House Panel Unveils Recovery Package

On January 15th the House Appropriations Committee released its version of an economic recovery package that appropriators describe as designed to create and preserve jobs, invest in infrastructure, energy efficiency, and science, and provide state and local fiscal relief.

The "American Recovery and Reinvestment Act of 2009" (ARRA) adopts many of the funding recommendations outlined by the Association of American Medical Colleges in an October 29th letter to Congressional leadership.  The full House may consider the bill the week of January 28th, with a goal of completing the bill by February 13th.

A press release from the House Ways and Means Committee suggests that Medicare and Medicaid provisions will be included in separate legislation.  A summary prepared by the Appropriations Committee references an extension of moratoria on unspecified Medicare and Medicaid regulations and "Medicaid aid to states."

The ARRA provides $1.5 billion to the National Institutes of Health (NIH) Office of the Director for research grants.  Half of this funding ($750 million) becomes available Oct. 1.  The funds provided in FY 2010 will provide the second year of support for the new research grants supported with the FY 2009 funding.  The bill specifies that funds are to be transferred to the NIH institutes and centers and the common fund "in proportion to the appropriations otherwise made to such Institutes, Centers, and Common Fund for fiscal year 2009."

The bill also provides $1.5 billion to the NIH's National Center for Research Resources (NCRR) to renovate or repair existing non-Federal research facilities or for "shared instrumentation and other capital research equipment."  NCRR is to give priority to applications "that are expected to generate demonstrable energy-saving or beneficial environmental effects."  An additional $500 million is provided to update buildings on the NIH campus.

In addition to the funding provided directly to NIH, the bill also provides $700 million to the Agency for Healthcare Research and Quality (AHRQ) for comparative effectiveness research.  The bill directs AHRQ to transfer $400 million of this funding to the NIH Office of the Director to be distributed among the NIH institutes and centers and the common fund for comparative effectiveness research.  The bill also provides an additional $400 million for comparative effectiveness research, to be allocated at the discretion of the Secretary of Health and Human Services. In total, the bill provides $1.1 billion for comparative effectiveness research.

The bill also provides $430 million to the Public Health and Social Services Emergency Fund for the Biomedical Advanced Research and Development Authority (BARDA) and an additional $420 million for pandemic influenza preparedness and response activities.

The ARRA provides $600 million (half of which becomes available Oct. 1, 2009) to the Health Resources and Services Administration (HRSA) for "primary care training." Though the bill does not specify specific funding levels, it directs HRSA to provide the funding for "the training of nurses and primary care physicians and dentists" through Title VII and VIII health professions programs, the National Health Service Corps, and the patient navigator program authorized under Title III of the Public Health Service Act.

The National Science Foundation (NSF) also receives a boost in the package. The bill provides $3 billion for NSF, including $2.5 billion for research and related activities.  The bill also directs $2 billion to the Department of Energy's Office of Science and the Centers for Disease Control and Prevention (CDC) receives $462 million for "equipment, construction, and renovation of facilities."


AAMC Urges NIH Funding in Stimulus

Columbia University Medical Center joined with the AAMC and nearly 200 patient groups, scientific societies, research organizations and companies to send a letter to President-Elect Barack Obama endorsing a recommendation to include at least $1.2 billion funding for the National Institutes of Health (NIH) in any immediate economic-stimulus effort, and to include this funding in the base for subsequent budget years.

             

The letter states, "Research contributes to the economic strength of the nation by creating skilled jobs in communities nationwide, new products, and improved technologies." The letter also notes, "The recent history of the NIH budget has hindered scientific discovery and is limiting the capacity of a key engine for today's innovation-based economy."

The groups also called on the President-elect to appoint a permanent NIH director "who understands the complexity and breadth of NIH's mission and who can help deploy scientific research investments wisely for maximum economic and health benefit."


Senate Stimulus Includes Additional $1 Billion for NIH

In November, Senate Majority Leader Harry Reid (D-NV.) and then Senate Appropriations Committee Chair Robert Byrd (D-WV) introduced an economic recovery package (S. 3689) that included additional funds for biomedical research and would temporarily increase the state federal medical assistance percentage (FMAP). The Senate did not vote on the measure.

The bill included $1 billion in additional funding to support scientific research at the National Institutes of Health, to be allocated among the Institutes, Centers, and the Common Fund in the same proportions that funding was distributed in FY 2008.

AAMC President and CEO Darrell G. Kirch, M.D., thanked the Senate, and especially Senators Reid and Byrd for recognizing that, "This increased NIH funding is not only an investment in our economy, it will support groundbreaking research that will improve the lives of all Americans through new medical advances. These research breakthroughs contribute to the financial strength of our nation by creating skilled jobs, new products, and better technologies."

The Ad Hoc Group for Medical Research sent a November 19th letter urging Senators to support the NIH funding included in the package.  The letter notes that "We must invest now in the NIH to maximize the benefits of scientific opportunity for our nation's fiscal as well as physical health."  The Coalition had sent a similar letter to House Speaker Nancy Pelosi (D-CA) in October urging her to support including additional NIH funding in any stimulus package.  Columbia University Medical Center cosigned this letter.

In addition to the NIH funding, under the recovery package, states would receive a temporary 8% increase in their FMAP (the federal portion of Medicaid). The increase, which affects the federal "Medicaid match" for each state, would apply to FY 2009 and the first quarter of FY 2010, at an estimated cost of $37.8 billion.  In October 29th letters to House and Senate leadership, the AAMC urged passage of a temporary FMAP increase.

 


House Democrats Begin Work on Second Stimulus Package

In mid-October, House Speaker Nancy Pelosi (D-CA) convened an economic forum with House Democratic leaders and some of the nation's leading economists to begin to lay the groundwork for a second economic stimulus package.  The size of the package has not been decided and thus far Speaker Pelosi’s staff has refused to put a number of the proposal, saying only that the economists said it should be larger than the $60.8 billion package approved by the House in late September but it will not be as high as $300 billion, as was reported in the press earlier in the week.              

In a statement released by her office following the forum, Speaker Pelosi said she has "asked the chairs of relevant committees to schedule hearings in the coming weeks on the key provisions of a fiscally responsible recovery package to get our economy moving again."  Hearings began the week of October 20th when Federal Reserve Chair Ben Bernanke testified before the House Budget Committee.

The timing for consideration of the package also has not been decided.  Pelosi staff said the plan might be considered in November, late January, or February, but cautioned against speculation that the House would conduct a lame-duck session in mid-November when members return to Washington for organizational meetings for the new Congress.   Senate Majority Leader Harry Reid (D-NV) has announced that the Senate will return for a lame-duck session beginning November 17th to take up a package of public land use bills that have been blocked by Senator Tom Coburn (R-OK).  No plans have been publicized for possible Senate action on a second economic stimulus.  In September, the Senate failed to gain the 60 votes needed to consider a $56.2 billion economic stimulus package offered by Senator Reid and Senate Appropriations Chair Robert Byrd (D-WV).  The "Economic Recovery Act of 2008" included an additional $1.2 billion for the National Institutes of Health.


NIH Funding Picture Looking a Little Brighter

After years of flat funding or small increases, sings are that Congress is planning to devote more resources to the National Institutes of Health (NIH).  A little noticed provision of the Emergency Supplemental Appropriations bill added $150 million to the NIH budget for this year, bringing total funding for FY 2008 to $29.38 billion.  The supplemental also included additional money fro research at the National Science Foundation, the Department of Energy, and the National Aeronautics and Space Agency.  President Bush signed the supplemental appropriations bill into law on June 30th.

Around the same time as Congress was finishing up work on the bill to add money to the FY 08 budget, it began work in earnest on the funding bills for FY 09 which begins October 1st, 2008.  Just prior to adjourning for the 4th of July recess, both the House and Senate Appropriations Subcommittees on the Departments of Labor, Health and Human Services, Education, and Related Agencies (Labor/HHS) marked up their respective funding bills for next year.    The Senate increased NIH funding to $30.26 billion, 3.5% over the original FY08 funding, and the House bumped up funding 3.9% to $30.38 billion.  Both these figure are less than increase members of the patient advocacy and research communities had hoped for but with these numbers, for the first time since FY 2003, the NIH budget would at least come close to keeping up with inflation.

Shortly after it passed the Senate subcommittee, the bill was voted on favorably by the full Senate appropriations committee; however, there has been no further action since then, nor is their likely to be any in the near future.  Traditionally, the Labor/HHS bill is the most contentious of all the funding bills and that can make consideration difficult and time consuming.  Other than defense, it is the largest, coming in at close to $150 billion for all programs under its jurisdiction, and abortion issues can often come up further delaying debate.  President Bush has said he will not sign either the House or the Senate bill in their current forms because they spend too much money.  Rather than push forward, Congress may try and delay consideration until after the election or even until after the new President is inaugurated in hopes of getting a more favorable reception from the White House.


House, Senate Negotiators Reach FY 2009 Budget Agreement

On May 20th House and Senate negotiators signed off on a conference agreement on the FY 2009 budget resolution (S. Con. Res. 70).

The conference agreement includes approximately $21 billion more for non-defense discretionary (appropriated) spending than requested by the President, an increase of slightly more than 2%.

Within that total, Function 550 (health) receives $59.7 billion, which is $5.2 billion higher than the President's budget.  The health community was seeking $58.556 billion for Function 550.

The conference agreement also assumes $2.4 trillion in Medicare spending over five years.  Mandatory health spending, which includes Medicaid and the State Children's Health Insurance Program (SCHIP), totals $1.4 trillion over five years. The budget resolution rejects the Administration's proposed cuts to Medicare and Medicaid, and it does not include reconciliation instructions.

The budget includes $198 million for FY 2009 Medicare fraud and abuse initiatives. It also contains several five year, non-binding, deficit-neutral reserve funds of interest to teaching hospitals and physicians, including:

  • Support for increasing Medicare physician payments and launching physician quality reporting programs;
  • Delaying implementation of certain Medicaid regulations, including the GME proposed rule and final rule on cost limits/units of government;
  • Establishment of a federal or public/private comparative effectiveness research initiatives;
  • The sharing of Medicare data for the evaluation of safety, quality, efficiency, and utilization;
  • $50 billion to reauthorize and expand SCHIP;
  • Promoting the adoption of health information technology, including electronic prescribing; and
  • Funding initiatives to cover the uninsured and underinsured.

The budget resolution is a nonbinding blueprint that lays out aggregate revenue and spending targets and sets the conditions for subsequent congressional consideration of tax and spending bills.

The House and Senate are expected to consider the conference agreement in June. Additional details on the conference agreement are available on the House Budget Committee website.


Senate and House Approve Budget Plans, Senate Calls for NIH Funding Increase

After slogging through dozens of amendments, on March 14th the Senate approved its FY 2009 budget plan (S.Con.Res. 70).  The vote on final passage was 51-44, with Maine Republicans Susan Collins and Olympia Snowe voting for the resolution and Indiana Democrat Evan Bayh voting against it.             

The House also passed its version of the budget resolution (H.Con.Res. 312) the day before by a vote of 212-207, with sixteen Democrats joining 191 Republicans to vote against the plan.  No Republicans voted for the budget.  The House passed its budget after rejecting alternative plans proposed by Republicans, the Congressional Black Caucus, and the Congressional Progressive Caucus.              

The Senate overwhelmingly approved an amendment offered by Senators Arlen Specter (R-PA) and Tom Harkin (D-IA), the Ranking Member and Chair, respectively, of the Senate Labor-HHS-Education Appropriations Subcommittee, to add an additional $2.1 billion to the funding level assumed in the budget for the National Institutes of Health (NIH).  The vote on the amendment, which also called for a $1 billion increase in the Low-Income Home Energy Assistance Program (LIHEAP), was 95-4, with Senators Tom Carper (D-DE), Jim DeMint (R-SC), James Inhofe (R-OK), and Jon Kyl (R-AZ) voting no and Senator David Vitter (R-LA) not voting.  All three Presidential candidates, Hillary Rodham Clinton (D-NY), John McCain (R-AZ), and Barack Obama (D-IL) were present and voted in favor of the amendment.  According floor statement by Senator Specter, "This $2.1 billion amendment, along with the $950 million already contained in the resolution would provide NIH with an increase of $3 billion or 10.3% over the FY08 appropriation."              

The vote in the Senate followed on the heals of a hearing by the Health, Education, Labor, and Pensions (HELP) Committee to explore the negative effects of five consecutive years of flat funding for the NIH on the next generation of medical researchers.  The committee heard the findings of a report, entitled "A Broken Pipeline? Flat Funding of the NIH Puts a Generation of Science at Risk."

Prepared by a group of seven academic research institutions, the report profiles twelve junior researchers from institutions across the country, who - despite their exceptional qualifications and noteworthy research - attest to the funding difficulties they and their professional peers are experiencing. 

HELP Committee Chair Edward Kennedy (D-MA) characterized the report as "a chilling statement of where our current budget policies for NIH will lead."  He noted, "If we lose the talents of a generation of young researchers, we put in peril not only medical progress, but America's leadership in the life sciences, too.  A culture of innovation and discovery does not just happen. It must be nurtured or it will wither."  The report, which was co-authored by Brown University, Duke University, Harvard University, The Ohio State University, Partners HealthCare, the University of California Los Angeles, and Vanderbilt University, was released earlier in the day at a press conference at the National Press Club.  It follows a similar report published last year by a slightly different group of institutions, including Columbia.  The 2007 report, "Within Our Grasp or Slipping Away?" focused on how the slowdown in NIH funding is holding up promising research and delaying potential breakthroughs in the prevention and treatment of disease.


Appropriations Subcommittee Questions Leavitt about Proposed FY 2009 Budget Cuts

On February 27th, the House Appropriations Subcommittee on Labor, Health and Human Services (HHS), and Education heard testimony from Secretary of HHS Michael Leavitt on the President's proposed budget for FY 2009.  Members on both sides of the aisle expressed their concerns about the cuts to many HHS programs, including the elimination of Title VII.

Appropriations Committee Chair David Obey (D-WI) began the hearing by stating that the Administration focuses too much on the cost of programs to help Americans, but does not focus enough on the cost of not having such programs.  He then mentioned that he is willing to negotiate on all aspects of the budget, but the President must also be willing to negotiate.  If he will not, Congress could choose to wait until the next Administration.  Congressman Obey said, "This can be a wasted eight months, or we can get something done."  Last year, "the President refused to compromise -- his way or no way -- and the year was wasted," he said, adding, "This year we can wait until we have another President."

Congresswoman Barbara Lee (D-CA) and Congressman Jesse Jackson, Jr. (D-IL) questioned cuts to Title VII diversity programs: Health Careers Opportunity Program (HCOP), Centers of Excellence (COE), and Scholarships for Disadvantaged Students (SDS).  They both expressed concern about the lack of attention to health disparities, which these programs were designed to help alleviate, and the effect that these disparities have on underrepresented minorities.  Secretary Leavitt responded that the Administration cut programs which they felt were ineffective, underperforming or duplicative, and that they were trying to focus their limited resources on direct services rather than infrastructure.  He commented that what looks like a reduction might not be, because it may be dealt with in another area of the budget, although he could not point to any other area with the same goals.  Congressman Jackson informed the committee that at the appropriate time, he will be proposing amendments to restore Title VII funding.

Congressman Tom Udall (D-NM), John Peterson (R-PA), and Dennis Rehberg (R-MT) questioned cuts to a multitude of rural health programs. Congressman Udall pointed out that Title VII training programs often produce health professionals who are willing to work in rural areas, and these cuts will negatively impact rural Americans.  Secretary Leavitt responded that other areas of the budget provide for 800 new nurses and 200 new dentists, many of whom will serve in rural areas, and the Administration feels these programs are more effective than Title VII has been.

Members also expressed concern about cuts Title VIII nursing programs. Responding to Congresswoman Lucille Roybal-Allard's (D-CA) question about the legitimacy of cutting nursing workforce programs during a nursing shortage, Secretary Leavitt expressed that the Administration feels as though Title VIII does not accurately respond to the nursing shortage, and that there needs to be a refocusing on competencies rather than infrastructure programs.  Congresswoman Roybal-Allard pointed out that you cannot have adequate services without infrastructure, and vice versa.  Secretary Leavitt could not respond to a question about the elimination of the Advanced Practice Nursing programs when there is a shortage of primary care practitioners, saying he will provide the answer in writing.

Congressman Obey expressed concern about the overall funding levels for the National Institutes of Health (NIH), which would result in over 600 grants being cut. Secretary Leavitt responded that not all grants are successful, and the Administration feels as though there is too much money for NIH that ends up going toward rising health care costs instead of prevention research.

Meanwile, a bipartisan group of House Members has sent a letter to the leadership of the House Budget Committee urging them "to allocate sums necessary to the National Institutes of Health (NIH) that at a minimum includes an increase relative to the cost of biomedical inflation" as they finalize the FY 2009 budget resolution.

The February 28th letter to House Budget Committee Chair John Spratt (D-SC) and Ranking Member Paul Ryan (R-WI) was signed by Representatives Edward Markey (D-MA), Dave Reichert (R-WA), Janice Schakowsky (D-IL), Chris Shays (R-CT), Joseph Courtney (D-CT), and Chris Smith (R-NJ).

The letter states, "Unfortunately, we have already seen the impact on biomedical research when the NIH budget fails to account for increases in inflation. In the short term, this amounts to a reduced number of NIH-funded grants awarded around the country each year. More broadly, inadequate funding for biomedical research delays or ends cutting-edge research, making it more difficult to retain talented researchers in the United States. Even worse, flat funding further impedes our ability to mitigate or delay the onset of chronic diseases which are the greatest contributor to spiraling health care costs."


AAMC, Health Organizations Urge Increased FY 2009 Health Funding

The AAMC joined over 440 organizations, including Columbia University Medical Center, in a February 19th letter to Congress urging increased funding for all federal public health activities and programs.  The coalition recommends a $5.3 billion increase in the FY 2009 discretionary funds allocated for health.  The letter cautions that the President's budget for FY 2009 continues to underfund and undermine these important initiatives. The letter notes that the recommended increase will:

  • restore funding to public health programs cut in FY 2006;

  • restore lost purchasing power that flat-funding for at least five years has eroded; and

  • provide investments that begin to truly meet health challenges facing the nation.


President Bush Releases FY 2009 Budget                 

On February 4th, President Bush released his FY 2009 budget.  The $3.1 trillion spending plan, which includes a projected deficit of $407 billion for the coming year, proposes to increase discretionary spending (i.e., programs that receive funding through annual appropriations) by $46.2 billion (4.9%).  But, as in the past several years, the Administration would direct almost all of this increase toward "security funding," proposing $594.5 billion for defense, homeland security, and international affairs, an increase of $44.9 billion (8.2%).  All other discretionary programs would receive $393 billion, an increase of $1.3 billion (0.3%).                 

While overall domestic discretionary spending is essentially frozen at last year's levels, there are winners and losers in the President's budget plan.  The Department of Health and Human Services would be cut by $1.5 billion (2.1%) to $70.4 billion while the Department of Veterans Affairs is slated for a $5.3 billion (13.5%) increase.                     

The following is list of the President's proposals for discretionary programs of interest to medical schools and teaching hospitals.

 National Institutes of Health (NIH):  The President's budget requests $29.230 billion in discretionary budget authority for NIH through the Labor- HS-Education Appropriations, which is equal to the FY 2008 appropriation.  The budget also assumes $78 million though the Interior Appropriations Subcommittee for the transfer from the Superfund to the National Institute for Environmental Health Sciences (NIEHS), $150 million in mandatory appropriations for type I diabetes, and $8 million in evaluation funds for the National Library of Medicine (NLM), for a program level of $29.465 billion, the same as in FY 2008.                   

In addition, the budget proposes to transfer $300 million from NIH to the Global Fund for HIV/AIDS, Tuberculosis and Malaria.  This is an increase of $5 million over the FY 2008 transfer.                 

According to the agency's Congressional Justification, the President's budget would support 9,757 new and competing renewal research project grants (RPGs), a decrease of fourteen from FY 2008, and a total of 36,526 RPGs, an increase of seventeen over last year.  The budget proposes again to eliminate inflationary increases for RPGs.   While the budget assumes no inflationary increases are provided for direct, recurring costs in non-competing RPG's, increases will be provided where NIH has committed to a programmatic increase in an award.  The average cost of competing RPGs will remain at the FY 2008 level.                  

The President's budget proposes to increase support for research centers to $2,963 million, a 0.7% increase above the FY 2008 level, to provide program growth for the Clinical and Translational Science Awards (CTSAs).                   

For training, the budget proposes modest stipend increases of 1% for both pre- and post-doctoral fellows.  Pre-doctoral fellows, who currently receive $20,772, have not seen a stipend increase since FY 2004.  Post-doctoral fellows, who begin at $36,996, have not seen a stipend increase since FY 2006 (for 0 to one year of experience only).  The budget would support 17,586 Full-Time Training Positions (FTTPs), an increase of seventeen FTTPs over the FY 2008 level.                   

The budget once again proposes to reduce the cap on salaries on extramural grants to Executive Level II ($172,200 in 2008).   Extramural salaries are currently capped at Executive Level I ($191,300 in 2008). 

Health Professions: The President's budget eliminates funding for all Title VII health professions programs ($194 million).  For Title VIII nursing education programs, the President proposes $110 million, a $46 million (30%) cut. 

Health Professions Student Loans: The President's budget request proposes a rescission of the "Federal portion of all the liquid assets" of the Health Professions Student Loan (HPSL), Primary Care Loan (PCL), Loans for Disadvantaged Students (LDS), and Nursing Student Loan (NSL).  This rescission would require participating institutions to return the Federal capital contribution of revolving funds that have not yet been dedicated to students.  The Federal capital contribution amounts to roughly 8/9ths of the institution's cash-on-hand, or as much as $4 million from participating institutions.  The Administration estimates this proposal will recall over $100 million from the student loan programs.  The President proposed this rescission in FY 2008, but the FY 2008 omnibus appropriations included a smaller, $15 million-rescission from the Title VII loan programs. 

National Health Service Corps: The President's budget request includes a total of $121 million for the National Health Service Corps (NHSC), a $3 million (2.4%) decrease from the FY 2008 omnibus appropriations.  The NHSC Recruitment allocation, which provides funding for the NHSC Scholarship and Loan Repayment Program awards, would be increased $11 million (13.1%) to $95 million.  The budget proposes to decrease the NHSC Field allocation, which provides funding for recruitment and retention administrative functions, by $14 million (35%) to $26 million.

 Children's Graduate Medical Education:  The President's budget eliminates funding for the Children's Graduate Medical Education, which was funded at $302 million in FY 2008.

 Agency for Healthcare Research and Quality:  The President's budget requests $325.7 million for the Agency for Healthcare Research and Quality (AHRQ), an $8.9 million (2.7%) reduction.  This request includes $30 million for comparative effectiveness research, as provided in FY 2008, and $32.1 million for patient safety research, a $2.1 million (6.1%) cut.  As provided in FY 2008, the President requests $44.8 million for health information technology. 

Education:  The President's budget eliminates the Perkins loan forgiveness program for a total savings of $65 million.  The budget also eliminates $1.1 billion in new Perkins federal capital contributions.                  

The President's budget also proposes legislative changes to programs created under the College Cost Reduction and Access Act.  In particular, the budget would limit eligibility for the Public Service Loan Forgiveness program to loans disbursed after July 1, 2009, instead of the current July 1, 2007, for a total savings of $1.464 billion.  Additionally, the budget would eliminate a provision of the new Income-Based Repayment (IBR) program that requires the Secretary to pay interest that accrues on subsidized loans for the first three of participation in IBR.  The budget estimates this change would save approximately $457 million.  


Congress Completes 2008 Funding

On December 19th Congress completed action on a $555 billion omnibus FY 2008 spending package.  President Bush signed the bill into law on December 26th.  The House had initially passed the "Consolidated Appropriations Act for FY 2008" two days earlier as an amendment to the State-Foreign Operations appropriations bill (H.R. 2764).  This was done so that the Senate could further amend the omnibus bill to provide additional Iraq funding. The Senate passed the measure 76-17 on the 18th, sending it back to the House for final approval of the additional war spending.

The omnibus bill includes $473.5 billion funding for the eleven regular appropriations bills that have not been signed into law, all except Defense.  This includes the bill that provides funding for the Department of Health and Human Services.  When combined with the Defense spending bill, which has already been enacted (P.L. 110-116), the total meets the President's overall discretionary spending limit of $932.8 billion.  This total does not include $70 billion in funding for military operations in Afghanistan and Iraq and $11.2 billion in emergency spending for items such as veterans' programs, border security, and drought relief that is included in the omnibus.

For programs funded under the Labor-HHS-Education bill (Division G), the omnibus provides $144.8 billion in discretionary spending for FY 2008, an increase of $316 million (0.2%) over the FY 2007 funding level, but $5.8 billion less than in the Labor-HHS conference agreement the President vetoed November 13th.  Most of the programs in the Labor-HHS portion of the omnibus were subject to a 1.747% across-the-board cut to meet the President's spending limit.

For the National Institutes of Health (NIH), the omnibus provides an appropriation of $29.229 billion, an increase of $329 million (1.1%) over FY 2007. The omnibus also includes a $196 million increase from 2007 to 2008 in the transfer from NIH to the Global HIV/AIDS Fund, which results in a net program level for NIH of $28.942 billion, an increase of $133 million (0.46%) over FY 2007.

In a December 18th statement, AAMC President Darrell G. Kirch, M.D., noted, "The AAMC is particularly frustrated with this outcome for the NIH, given that members from both sides of the aisle in the House and Senate approved a conference agreement in early November that provided a $900 million (3.1 percent) increase for the NIH.  Despite this strong bipartisan support, the White House's insistence on an unrealistic spending cap has resulted in what is essentially a freeze on all domestic spending."

After adjusting for the 1.747% across-the-board rescission, the bill provides $194 million for the Title VII health professions training programs, a $9.2 million (5%) increase over FY 2007.  Within that total, the Health Careers Opportunity Program (HCOP) receives $9.8 million, a $5.9 million (148%) increase, and the Centers of Excellence (COE) receive $12.8 million, an $893,000 (7.5%) increase over FY 2007.  As a result of the across-the-board rescission, the bill reduces funding for the primary care training programs by $853,000 (1.7%) for a total of $48 million.   The vetoed conference agreement had provided $212 million for Title VII, including $16.2 million for HCOP and $20.2 million for COE.  A $15 million rescission is applied to the Title VII health professions student loan programs. This rescission was not included in the vetoed conference report.

The omnibus provides $123.5 million for the National Health Service Corps (NHSC), a 2.2 million decrease from FY 2007 as a result of the 1.747% across-the-board rescission.  The House had approved $131.5 million, a $5.8 million (4.6%) increase over FY 2007.  The new funds increase the NHSC recruitment appropriation, which funds the NHSC scholarship and loan repayment awards, to $91 million.  The Senate bill had level funded the NHSC at the FY 2007 level ($125.6 million), rejecting the proposed $9 million (7.2%) cut in the President's budget.

The bill provides $334.6 million for the Agency for Healthcare Research and Quality (AHRQ), a $15.6 million increase (4.9$), as provided in the vetoed conference agreement.  The AHRQ total includes $30 million for clinical effectiveness research, double the $15 million designated for such research in FY 2007.  Unlike both the House and the Senate bills, which funded AHRQ through a direct appropriation, the omnibus provides AHRQ funding through Evaluation Tap funding, as in years past.

Children's Hospitals Graduate Medical Education (GME) receives $301.6 million, a $4.6 million (1.6%) increase over FY 2007.  The conference agreement provided the House-recommended $307 million for Children's GME, while the Senate had proposed $200 million, a $97 million cut.  For the Centers for Disease Control and Prevention (CDC), the omnibus provides a program level of $6.5 billion, adding $110 million (1.8%) over FY 2007. The conference agreement had proposed $6.6 billion for CDC.


House Fails to Override HHS Funding Veto

The House of Representatives failed to override President Bush's veto of the FY 2008 Labor-HHS-Education Appropriations bill (H.R. 3043).  The 277-141 tally fell two votes short of the two-thirds majority needed to override the veto.  A total of fifty one Republicans voted to override; no Democrat voted to sustain the veto.

The President had vetoed the bill on November 13th. In his message returning the bill to the House of Representatives, the President stated, "This bill spends too much. It exceeds the reasonable and responsible levels for discretionary spending that I proposed to balance the budget by 2012.  The Congress is on a path to spend $205 billion more over the next five years than I requested.  This puts a balanced budget in jeopardy and risks future tax increases."  Noting that the bill includes nearly $10 billion more than he had requested, the President said,  "Health care, education, job training, and other goals can be achieved without this excessive spending, if the Congress sets priorities."

The Labor-HHS conference agreement included $30 billion for NIH in FY 2008, an increase of $1.1 billion (3.8%) over the FY 2007 level, and $212 million for Title VII health professions training programs, an increase of $27.3 million (14.7%).

During the debate prior to the override vote, House Appropriations Chair David Obey (D-WI) stated, "People may like to cast a vote without having to take responsibility for knowing the consequences.  But there are severe consequences for voting against overriding the President's veto of the Labor-Health-Education bill."  He noted, "If this veto is not overridden, then the best that could happen is we wind up splitting the difference with the President's wholly inadequate budget."

Chairman Obey went on to warn that if Congress agreed to a 50% cut to the difference between the Labor-Health-Education bill and the President's budget, "For medical research into diseases like cancer, Parkinson's and diabetes at the National Institutes of Health, meeting the President halfway would put us $700 million below the bill we are considering today.  That means about 700 fewer grants for research to treat and cure so many deadly diseases."

Chairman Obey referenced an announcement earlier in the day by Senate Majority Leader Harry Reid (D-NV) that the chairman and Senator Robert Byrd (D-WV), chair of the Senate Appropriations Committee, were working on an omnibus spending bill to be considered in December that would split the difference between Congress and the President.  Congressional Democrats have been seeking to add $22 billion to the President's FY 2008 budget, including $9.8 billion in the Labor-HHS bill.

The Labor-HHS conference agreement included $30 billion for NIH in FY 2008, an increase of $1.1 billion (3.8%) over the FY 2007 level, and $212 million for Title VII health professions training programs, an increase of $27.3 million (14.7%).


President Bush Signs Defense Spending Bill, Includes Second Short-term Funding Extension

On November 13th President George W. Bush signed the FY 2008 Department of Defense Appropriations bill (H.R. 3222, P.L. 110-116).  The bill also includes a second continuing resolution (CR), which extends funding at FY 2007 levels for other federal programs (including NIH) through December 14th.

The new CR funds the Veterans Health Administration programs at a rate equal to the levels proposed in the President's FY 2008 budget. The President's budget included a 2.3% increase for VA medical care and a 7.9% reduction for the VA Medical and Prosthetics Research program, compared to the FY 2007 appropriated levels (including funding provided in the FY 2007 emergency supplemental, P.L. 110-34).

The CR also includes short-term extensions of funding that falls outside the appropriations process, including for the State Children's Health Insurance Program (SCHIP).  The federal government had been operating under a CR (P.L. 110-92) that expired on November 16th.


Congress Clears HHS Funding Bill for President

On November 8th the United States House of Representatives approved the conference report on the FY 2008 Labor-HHS-Education Appropriations bill (H.R. 3043), clearing it for the President’s signature.  The vote was 274-141, which is short of the two-thirds needed to override President Bush's expected veto of the bill.  A total of fifty-one Republicans voted for the measure; no Democrat opposed it.

             

The House had earlier passed (269-142) the conference report on H.R. 3043 when it included both the FY 2008 Labor-HHS-Education and Military Construction-Veterans Affairs spending bills.  Democratic Congressional leaders had combined the two bills to force the Administration to agree to approximately $10 billion in additional funds above the President's request in the Labor-HHS bill.

             

The Senate considered the combined Labor-HHS and MilCon-VA spending package the day before, but lobbying and ethics legislation (PL 110-81) passed earlier this year changed the Senate rules to permit Senators to strike provisions from a conference report that were not in the bill passed by either the House or the Senate.  Since the conference agreement was technically for the Labor-HHS bill, the MilCon-VA funding was vulnerable to a point of order to separate the bills.

             

Senator Kay Bailey Hutchison (R-TX) offered the point of order against the package, and the Senate failed (47-46) to approve a motion by Senate Labor-HHS-Education Appropriations Subcommittee Chair Tom Harkin (D-IA) to waive the point of order.  After the MilCon-VA funding was stripped from the package, the Senate then voted 55-37 to approve the Labor-HHS conference agreement and send it back to the House for final approval.

             

In a Statement of Administration Policy issued on November 6th, the White House repeated its promise to veto the Labor-HHS bill.

             

The House and Senate conference agreement on Labor-HHS includes $30 billion for NIH in FY 2008, an increase of $1.1 billion (3.8%) over the FY 2007 level, and $212 million for Title VII health professions training programs, an increase of $27.3 million (14.7%).


Senate Considers HHS Spending Bill

On October 17th the United States Senate began debate on the FY 2008 Labor-HHS-Education appropriations bill (H.R. 3043).  Senate Majority Leader Harry Reid (D-NV) announced that the goal was to finish the bill by October 23rd.

At the beginning of the Senate debate, Senators Tom Harkin (D-IA) and Arlen Specter (R-PA), the Chair and Ranking Republican, respectively, on the Senate Labor-HHS Appropriations Subcommittee, offered an amendment to drop a provision that would expand federal funding of embryonic stem cell research. The Senators acted in response to the Administration's threat to veto the bill over the provision, which they added during committee consideration of the bill.

The White House reiterated its threat to veto the bill in a Statement of Administration Policy (SAP) issued October 17th that states, "The Administration strongly opposes S. 1710 because, in combination with the other FY 2008 appropriations bills, it includes an irresponsible and excessive level of spending and includes other objectionable provisions."

Columbia joined a diverse group of 850 education, training, disability, public health, medical research, child welfare organizations and labor unions in an October 18th letter urging the Senate to pass the Labor-HHS spending bill.  The letter states the programs funded by the bill "share a common, fundamental goal of strengthening this nation by investing in and improving the quality of life of its people, especially the most vulnerable."  The letter also notes the bill, which received broad, bipartisan support by the Senate Appropriations Committee, "provides a modest overall increase for programs in the bill, most of which have experienced significant cuts, lost purchasing power, or both over the past three years."


House Letter Urges Title VII Restoration

March 26, 2007 - A March 16th letter to the Chair and Ranking Member of the House Appropriations Subcommittee on Labor, Health and Human Services, and Education and Related Agencies, signed by 98 Representatives, called for the restoration of the Title VII health professions programs to FY 2005 levels.  As in years past, Rep. Diana DeGette (D-CO) organized the letter.  She was joined by Rep. Cathy McMorris Rodgers (R-WA).  The late Rep. Charlie Norwood (R-GA) had served as the lead Republican on this letter for the past several years.

The letter, addressed to subcommittee Chair David Obey (D-WI) and Ranking Member Jim Walsh (R-NY), describes how "reducing this resource has already had devastating effects to the country's neediest communities," and urges the appropriators to enable grantees "to continue to improve the distribution, quality, and diversity of the health professions workforce" by restoring funding.  A companion letter led by Senators Jack Reed (D-RI) and Pat Roberts (R-KS) is expected to begin circulating the week of March 26th.


AAMC, Health Groups Urge Congress to Restore Public Health Funding

March 13, 2007 - A February 26th letter, signed by Columbia and 405 other health organizations, urges Congress to increase funding for public health programs by an additional $4 billion (7.8 percent) above the FY 2007 level.  The letter states that this increase in the FY 2008 budget for Function 550 discretionary health programs will restore cuts enacted in the FY 2006 budget and "reverse the erosion of support" for the programs that make up the public health continuum.

Federal agencies that receive funding under Function 550 include the National Institutes of Health, the Health Resources and Services Administration (which administers Title VII grants and the National Health Service Corps), the Agency for Healthcare Research and Quality, the Centers for Disease Control and Prevention, and the Food and Drug Administration. The House Budget Committee is expected to mark up its version of the FY 2008 budget resolution the week of March 12, with floor consideration the following week.


New Appropriations Chairs Propose Year-Long Continuing Resolution

December 22, 2006 - On December 11th, the incoming chairs of the Senate and House Appropriations Committees announced that they plan to enact a continuing resolution (CR) to fund federal programs for the duration of FY 2007.  They also announced a "moratorium" on all Congressional earmarks in FY 2007 appropriations bills.

Only two FY 2007 spending bills have been signed into law: Defense and Homeland Security. During the final hours of the 109th Congress, the House and Senate passed a third CR to keep federal programs running through February 15th. Senator Robert Byrd (D-WV) and Congressman David Obey (D-WI), who will assume control of the Senate and House Appropriations Committees in the 110th Congress, announced they will extend that measure for the remainder of FY 2007 rather than attempt to pass the remaining FY 2007 spending bills, either individually or as part of an omnibus package.

Senator Byrd and Congressman Obey said they would make "limited adjustments" in the CR to address important policy priorities, but did not identify specific priorities.  Among the bills that have not been enacted is the Labor-HHS-Education appropriation, which funds the National Institutes of Health and the Title VII health professions programs.  Unless adjustments are made in the CR, programs in the Labor-HHS bill would be funded at the FY 2006 level.

The extended CR will not include the earmarks contained in the remaining FY 2007 spending bills.  Senator Byrd and Congressman Obey said they were placing a "moratorium" on all earmarks until "a reformed process is put in place."  They stated, "We will work to restore an accountable, above-board, transparent process for funding decisions and put an end to the abuses that have harmed the credibility of Congress."


Senators Call for Additional Health Funding

A bipartisan letter signed by 57 Senators, including New York’s Charles E. Schumer and Hillary Rodham Clinton, was sent to the Senate leadership on October 27th asking for an additional $2 billion to be added to the FY 2007 Labor/HHS/Education spending bill.  The letter, organized by Senators Arlen Specter (R-PA) and Tom Harkin (D-IA), the Chair and Ranking Member, respectively, of the Labor/HHS/Education Appropriations Subcommittee, was sent to Senate Majority Leader Bill Frist (R-TN) and Minority Leader Harry Reid (D-NV) as well as to Senators Thad Cochran (R-MS) and Robert C. Byrd (D-WV), the Chair and Ranking Member of the full Appropriations Committee.

The letter notes that in March seventy three Senators voted for the Specter-Harkin amendment to the FY 2007 budget resolution (S.Con.Res. 83) to provide an additional $7 to restore funding to the FY 2005 level.  The letter states the appropriations bill approved by the Senate Appropriations Committee on July 20th falls $2 billion short of FY 2005, "effectively ignoring the intent of the Senate."

The letter continues, "At a time when the demand for job-training and education is critical to maintain America's competitiveness, and when the cost of health care and access to quality care are major issues for many Americans, we simply cannot afford to cut funding for health care and education.  These cuts move our country in the wrong direction."


President Bush Signs Funding Extension

October 9, 2006 - On September 29th, one day before the end of the fiscal year, President George W. Bush signed the FY 2007 Defense appropriations bill (H.R. 5631, P.L. 109-289).  The bill included a continuing resolution (CR) to provide funding for federal programs through November 17th.  The CR is necessary because only two of the twelve annual appropriations bills have been signed into law.  For programs within the Labor-HHS-Education appropriations bill the CR provides funding at FY 2006 levels.


Moderate Republicans Push For More Labor-HHS Funding

September 29, 2006 - A group of twenty-four moderate Republican members of the House of Representatives is calling on their leadership to fulfill a commitment made earlier this year to provide additional funding for the FY 2007 Labor-HHS appropriations bill.  The moderates, led by Congressman Mike Castle (R-DE.), sent a September 27th letter reminding House Majority Leader John Boehner (R-OH) "of the agreement to provide no less than $7 billion above the Administration's request" for the FY 2007 Labor-HHS bill.  The letter states, "This amount is equal to the funding enacted in FY06 … plus a 2 percent inflationary increase."  When the House Appropriations Committee determined its FY 2007 subcommittee allocations, over $6 billion was shifted from defense and foreign operations into domestic discretionary spending, including $4.1 billion added to the Administration's request for the Labor-HHS bill.  The letter notes that as a result of further negotiations on the FY 2007 budget resolution (H.Con.Res. 376), the Majority Leader "and other members of our leadership committed to providing no less than $3 billion above the $4.1 billion that had already been shifted for programs" in the Labor-HHS bill.  In addition to Congressman Castle the letter was signed by Republicans Representatives Judy Biggert (IL), Sherry Boehlert (NY), Charlie Dent (PA), Michael Fitzpatrick (PA), Jim Gerlach (PA), Wayne Gilchrest (MD), Nancy Johnson (CT), Timothy Johnson (IL), Sue Kelly (NY), Randy Kuhl (NY), Jim Leach (IA), Frank LoBiondo (NJ), Steven LaTourette (OH), John McHugh (NY), Todd Platts (PA), Jon Porter (NV), Jim Ramstad (MN), Dave Reichert (WA), Joe Schwarz (MI), Christopher Shays (CT), Rob Simmons (CT), Fred Upton (MI), and Curt Weldon (PA).

Faced with having completed only two of the 11 annual appropriations bills prior to the October 1st start of the federal fiscal year, Congress approved a continuing resolution (CR) to continue funding for federal programs through November 17th. The CR, which is included in the FY 2007 Defense appropriations bill (H.R. 5631), funds programs at the FY 2006 level, the House-passed FY 2007 level, or the Senate-passed level, whichever is lowest.  Since neither the House nor Senate has passed the Labor-HHS appropriations bill (H.R. 5647, S. 3708), funding for those programs will be continued at the FY 2006 level.  Congress will return to the annual spending bills when it comes back in session on November 13th.


Senate Panel Boosts NIH Funding by $220 Million

July 27, 2006 - On July 20th The Senate Appropriations Committee approved its FY 2007 Labor-Health and Human Services (HHS)-Education spending bill (S. 3708).  The bill provides $142.8 billion in discretionary funding for FY 2007, an increase of nearly $1.27 billion (0.9% over the current year's funding level.  For Public Health Service programs within the bill, the Senate proposal provides $45.2 billion, an increase of $936 million (2.1%) over the current year and $235 million more than is included in the bill (H.R. 5647) the House Appropriations Committee approved on June 13th.

The Senate bill includes a program level of $28.459 billion for the National Institutes of Health (NIH), an increase of $220 million (0.8%) over the FY 2006 comparable amount.  The program level includes an appropriation of $28.551 billion, minus $100 million transferred from NIH to the Global AIDS/HIV Fund, plus the transfer of $8.2 million in evaluation tap funds to the National Library of Medicine.  The Senate bill is $201 million over the program level of $28.258 billion in the House bill.  The Senate bill retains the salary cap on NIH extramural grants at Executive Level I ($183,500 in 2006). The House bill adopted the Administration's request to reduce the salary cap to Executive Level II ($165,200).

The Senate bill includes $154.4 million for Title VII health professions education programs, a $9.2 million (6.35) increase over FY 2006 and $9.2 million less than the House bill provides.  However, neither bill restores the 52% cut below the FY 2005 level enacted in the FY 2006 budget.  All Title VII programs are level funded with FY 2006, with the exception of $50 million for primary care programs, a $9 million (22.4%) increase.  The Senate bill does not restore the geriatrics training funds, which were eliminated in FY 2006, while the House bill provides the FY 2005 level of $31.5 million. The Senate bill also includes $8 million for public health, preventive medicine and dental public health, which is level with FY 2006; the House bill eliminates these funds.  Title VIII nursing is funded at $150 million, level with FY 2006 and the House bill.

Among other health programs, the National Health Service Corps receives $125.5 million, the same level of funding as FY 2006, but $6 million less than provided in the House Committee bill.  The Senate bill designates $200 million for Children's Hospitals Graduate Medical Education for FY 2007, $96.8 million (32.6%) less than FY 2006 and $100 million less than the House bill.  The Agency for Healthcare Research and Quality (AHRQ) receives $318.7 million, level funding relative to FY 2006 and the House bill. Both the House and Senate bills provide the FY 2007 funds through direct appropriations, as opposed to the evaluation tap funds, which funded the agency in FY 2006.

The Senate bill includes $6.1 billion for the Centers for Disease Control and Prevention (CDC), a $20.2 million decrease below FY 2006, but $21.4 million more than the House bill provides.  The Senate bill provides $106.7 million for the Department of Education's National Institute on Disability and Rehabilitation Research, equal to FY 2006 and the House bill.

During the markup, Senators Sam Brownback (R-KS) and Richard Durbin (D-IL) did not offer an expected amendment to prevent proposed reductions in Medicaid's allowable provider tax rate.  The President has proposed regulatory changes that would reduce the allowable rate from 6% to 3%. Estimated to save $2.1 billion, the reduction will likely have a direct and dramatic impact on many Medicaid providers.

The Labor/HHS bill is normally among the most controversial, if not the most controversial, annual appropriations bill.  Although passed by committee in both houses by late July, neither the House nor the Senate is likely to take up its bill on the floor before the November election.


House Appropriations Panel Approves HHS Funding Bill

June 20, 2006 - On June 13th, the House Committee on Appropriations approved its FY 2007 Labor-HHS-Education spending bill.  The committee endorsed the funding levels approved by the Labor-HHS-Education Appropriations Subcommittee June 7th [see Washington Highlights, June 9].

The committee report accompanying the bill notes that the bill includes $25 million for extramural facilities construction grants through the National Center for Research Resources (NCRR).  The committee "encourages NCRR to give special consideration to applications … from potential grantees in states who are under-represented with regard to NIH awards and to projects at historically minority institutions that have developed a comprehensive plan to address the disproportionate impact of cancer in minority communities."  Facilities for research on infectious agents and countermeasures are also eligible to compete for this funding.

The bill includes language (section 204) that amends the salary cap on extramural grants to Executive Level II ($165,200 in 2006). The current cap is at Executive Level I ($183,500).

The House bill also includes a provision (section 220) requiring all NIH-funded authors to deposit an electronic version of their final, peer-reviewed manuscripts in the National Library of Medicine's PubMed Central "as soon as practical but no later than 12 months after the official date of publication.”.

Also included in the report, the committee recommends that within the $11.9 million appropriated for Title VII Centers of Excellence (COE), one third of the funds is to be set aside for Hispanic COEs.  Furthermore, the committee rejects the President's proposed rescission to the Title VII student loan programs, which would recall "the federal portion of all the liquid assets of such fund."

The Appropriations Committee adopted an amendment by Rep. Joanne Emerson (R-MO) that would prevent the $2.1 billion reduction (over 5 years) in Medicaid provider taxes assumed by the President's budget proposal.  The President's proposal reduces from 6% to 3% the level of provider taxes eligible for a federal match under the Medicaid program.


AAMC Urges Congress to Save Health Professions Programs

June 20, 2006 - On June 1st, the AAMC sent a letter to all Members of Congress urging their support for the restoration of funding for the Title VII health professions programs to the FY 2005 level of $300 million.  The enacted FY 2006 budget cuts the programs by 52% and eliminates programs essential to improving the nation's health care workforce.  The FY 2007 bill passed June 7 by the House Labor-HHS-Education Appropriations Subcommittee includes an $18 million increase above the FY 2006 level, bringing the programs to $164 million.

The letter, signed by 132 AAMC member institutions, states that Title VII programs "provide vital support to the nation's medical schools and teaching hospitals for the recruitment, education and training of a unique group of physicians and other health professionals, who are more likely to provide care in rural and other underserved areas."  It highlights the drastic cuts to vital programs funded through Title VII that recruit and mentor minority students, such as the Centers of Excellence and Health Careers Opportunity Programs, and points out that the 54% cut to primary care programs hampers efforts to train primary care providers needed across the country.

The letter closes by stating that restoring $300 million to the Title VII programs "will have enormous impact as AAMC members and our fellow health professions educators strive to provide the nation a well-trained, diverse health care workforce."


House Passes Budget Plan

May 26, 2006 - Shortly before 1 a.m. on May 18, the House approved its FY 2007 budget resolution (H.Con.Res. 376) after moderate Republicans secured a non-binding agreement with the leadership calling for more funding for health and education programs.

The moderates, led by Rep. Mike Castle (DE), Nancy Johnson (CT), and Dave Reichert (WA), had offered a substitute budget to increase funding for the Labor-HHS-Education appropriation by $7.158 billion to bring the bill to its FY 2006 level plus a 2% inflationary increase.  As a result of negotiations on that amendment, the moderates secured a partial victory earlier this month when the House Appropriations Committee agreed to transfer over $6 billion from the defense and foreign operations accounts to domestic programs, including increasing the allocation for the Labor/HHS/Education Subcommittee by $4.1 billion above the President's budget

The budget resolution was amended to create a $3.1 billion reserve fund for health, education, and other domestic priorities, but only if these funds are offset by savings from other discretionary or mandatory programs.  Under an amendment by Rep. Curt Weldon (R-PA), at least $1 billion of the offset for any increases for the Labor-HHS-Education bill would come from unobligated funds for Iraq reconstruction.  The moderates also received assurances from the leadership that the additional $3.1 billion would not come from Medicaid, Medicare or other programs to help special populations.

Passage of the budget resolution permits the House to proceed with consideration of the individual annual appropriation bills without having to "deem" individual spending caps for each measure.  Although it is unlikely the House and Senate will resolve the differences between their individual budget resolutions, the House can move forward under the $873 billion discretionary spending cap imposed in its budget plan.

The final vote on the budget was 218 to 210, with twelve Republicans voting against the final package.  No Democrat voted in favor of the budget.  During debate on the budget, the House rejected alternative budget plans offered by the Democrats, the conservative Republican Study Committee, and the Congressional Black Caucus.


AAMC Opposes Student Loan Rescissions

AAMC President Jordan J. Cohen, M.D. urged the House and Senate Appropriations Committees not to approve any further rescissions to the Title VII health professions student loan programs.  In each of the past two years, Congress has rescinded the "unobligated balance" from the Health Professions Student Loan, Primary Care Loan, Loans for Disadvantaged Students, and Nursing Student Loan programs.  In addition, the Administration's FY 2007 budget proposes to recall the "Federal portion of all of the liquid assets of such fund," which it estimates to be over $100 million.

In the letter, Dr. Cohen asks appropriators to consider that the demand for these affordable loans will increase in the coming years as interest rates rise and that these programs pose no burden on the American taxpayer.  The letter also states, "Rescinding funds from these programs not only neglects financially disadvantaged and minority students, but also threatens the stability of our nation's healthcare infrastructure."


HHS Secretary Leavitt Testifies on FY 2007 Budget

May 12, 2006 - On May 3rd Secretary of Health and Human Services Michael Leavitt testified before the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies.  Subcommittee members expressed concern over the Administration's proposed cuts to the Centers for Disease Control and Prevention and the level funding of the National Institutes of Health (NIH), especially in light of an anticipated flu pandemic.  Secretary Leavitt testified that he is committed to maintaining momentum in research and "fought hard to keep [NIH] funding flat" in this deficit reduction budget.

Other issues of concern to the subcommittee included the importance of prevention initiatives, support for rural and aging populations, and health professions training.  Senator Dick Durbin (D-IL.) worried that the country is not keeping up with the demand for health professionals, and Senator Larry Craig (R-ID) asked how the Administration reconciles expanding Community Health Centers while reducing support for training programs that help staff the centers.


FY 2007 Budget Stalls in the House

(AAMC’s Washington Highlights) After weeks of negotiations, the House Republican leadership 6 decided to delay action on the FY 2007 Budget Resolution (H.Con.Res. 376) until after the Easter recess.  In a statement released April 6th, House Majority Leader John Boehner (R-OH) blamed Democrats for the budget delay and vowed to "remain committed to working with all members to reach agreement on budget process reforms so we can move forward with the budget after the Easter District work period."

The leadership decided to the pull the Budget Resolution when it could not craft a compromise between three factions within the Republican Party. On April 4th, moderate Republicans Michael Castle (DE), Nancy Johnson (CT), and Dave Reichert (WA) announced they would seek an amendment to add $7 billion to the budget resolution in discretionary spending to restore cuts in health, education, and low-income energy subsidies.  AAMC President Jordan Cohen sent a letter to all members of the House urging them to vote against the budget resolution unless it includes the additional $7 billion for health, education, and human services programs.

Conservative Republicans strongly opposed additional funds in the budget resolution.  Republican Study Committee Chair Mike Pence (IN) suggested a "significant departure" of conservative votes for the resolution if the $7 billion was added to the budget resolution.

Conservatives also were unhappy that the budget resolution approved by the House Budget Committee did not call for greater cuts in mandatory spending.  In return for their support of the budget resolution, the Republican Study Committee sought a series of tougher budget rules, including a line-item veto and earmark reform.  On April 6th conservatives announced that they had a deal with the leadership on budget reforms, but they were immediately challenged by House Appropriators, who signaled they would oppose any change in budget rules that would limit their authority.  In an April 6th statement, House Appropriations Chair Jerry Lewis (R-CA) said, "I cannot and will not support a resolution that greatly diminishes Congress' ability to respond to national disasters and makes it more difficult for us to get our budget work done on time."

The House adjourned on April 6th and will return to Washington on Tuesday, April 25th to resume consideration of the budget resolution.


Senate Approves Specter/Harkin Amendment to Increase Health, Education Funding

March 23, 2006 - On March 16th the Senate approved, by a vote of 51 to 49, the FY 2007 budget resolution, but the big news was that earlier in the day, by a vote of 73 to 27, the Senate passed an amendment offered by Senators Arlen Specter (R-PA) and Tom Harkin (D-IA), the chair and ranking member of the Senate Labor-HHS-Education Appropriations Subcommittee, respectively, to provide an additional $7 billion in discretionary spending over the level contained in the budget resolution approved by the Senate Budget Committee. The budget resolution is a blueprint of what taxing and spending priorities and does not contain specific program numbers for individual programs the way an appropriations bill, which Congress will take up later in the year, does. One way of looking at it is that the budget resolution determines the size of the pie, while the appropriations bills figure out how that pie is sliced.

The Specter/Harkin amendment would provide an additional $7 billion in funding for priority health and education programs, including the National Institutes of Health, the Centers for Disease Control, the Health Resources and Services Administration, vocational education, K-12 education, and higher education. If the Specter/Harkin amendment had not passed, it would have been nearly impossible to find additional funds for these programs late in the budget process.

The Specter/Harkin amendment passed after a huge and intense lobbying effort by education and health care advocates. Columbia University was part of this effort. As expected, both New York Senators, Hillary Rodham Clinton and Charles Schumer, voted yes, but the aye votes also included Senate Majority Leader Bill Frist (R-TN) and several other Republican Senators who are up for reelection this year.

The Senate also approved an amendment by Sen. Richard Burr (R-NC) to create a reserve fund for pandemic influenza preparedness planning after rejecting an amendment by Sen. Kent Conrad (D-ND) that would have increased funding for pandemic flu preparedness by $5 billion. The Senate also defeated an amendment by Sen. Edward Kennedy (D-MA) that would have added $6.3 billion to the discretionary spending cap to increase education funding. The Senate also defeated a Conrad amendment to require offsets for tax cuts and new mandatory spending programs.

The budget resolution establishes an $873 billion spending cap for discretionary programs in FY 2007 and includes a controversial reconciliation instruction to open the Arctic National Wildlife Refuge to energy exploration. Confronted with increasing resistance from Senators concerned about election year impacts, Senate leaders abandoned plans to seek further reductions in Medicare and other mandatory spending or to increase tax cuts further.

The House will not take up its version of the budget resolution until after it returns from recess on March 27th. The two Houses will meet in conference to come to an agreement on the FY 2007 budget resolution.


NIH Revises FY 2006 Grant Funding Policy

January 13, 2006 - On January 9th the National Institutes of Health (NIH) issued a notice detailing its revised grant funding policy to reflect the recently enacted appropriations for the agency. NIH, like most other domestic discretionary accounts, was subject to a 1% across-the-board cut for FY 2006. NIH's share of this cut is approximately $286 million and has established the following financial policies. Non-competing awards for every research project grant (RPG) will be awarded at a level of 97.65 % of the amount indicated for the FY 2006 budget period in the Notice of Grant Award for the previous budget year. The amounts indicated for future budget periods will also be adjusted by the same factor. The amounts provided for competing RPGs will be managed to an average award amount equal to FY 2005 levels. FY 2006 policy includes the provision of a 3% escalation factor in the amounts indicated for future years on competing RPG awards, which are not based on modular applications.



Congress Completes Spending Bills Before Holiday Recess, Barely

January 3, 2006 - Originally slated to adjourn in early October, the first session of the 109th Congress actually got off to a quick start. The annual budget resolution was completed in the spring and both Houses made significant headway towards completing work on the annual appropriations bills, even with both the House and the Senate Committee having new Chairs and undergoing fairly significant reorganizations. But hurricanes, Supreme Court nominations, criminal investigations, and often rancorous debates over the PATRIOT Act, alleged prisoner abuse and the war in Iraq conspired to cause Congress to fall behind schedule.

The House actually completed work on all eleven appropriations bills by the July 4th recess and the Senate completed nearly half of its bills before the summer recess. The pace slowed down quite a bit September as the confirmation process for Justice John Roberts became the primary order of business. Senator Arlen Specter (R-PA), who chairs the Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies (Labor/HHS), is also Chairman of the full Judiciary Committee.

The new Fiscal Year, FY 2006, began on October 1st, and Congress hoped to complete its appropriations work by then, but it was not to be. After moving quickly and sending nine appropriations bills to President by the end of October, efforts to complete work on the remaining two bills hit a road block when, in a vote that shocked all those who follow the United States Congress closely, the House of Representatives voted 224-209 to reject the conference agreement on the FY 2006 Labor/HHS appropriations bill, sending it back to conference for further consideration.

Unlike other appropriations bills, the conference report contained no earmarks, money directed by Congress for specific projects. Medical schools and other health advocates had opposed the conference agreement, citing severe cuts to Title VII health professions programs and the minimal increase for the National Institutes of Health. After restoring funds for rural health initiatives, the Republican leadership brought the bill back to the floor in mid December. This time it squeaked by 215-213, again with no Democrats in favor of the bill. No additional money was added to the NIH, which remains at $28.617 billion. The revised conference agreement added $52.7 million to the Title VII programs, bringing the total to $146.7 million, a $153 million (51%) cut below last year.

After resolving a contentious issue over language banning torture, Congress also managed to pass the eleventh and final bill, the Defense Appropriations bill. This bill includes a 1% across the board cut on all domestic spending, including NIH, meaning that there will actually be a very small net decrease in funding.



House Defeats Labor, HHS, and Education Spending Bill

In a vote that shocked all those who follow the United States Congress closely, The House of Representatives voted 224-209 to reject the conference agreement on the FY 2006 Labor, Health and Human Services (HHS), and Education appropriations bill, sending it back to the conference committee for further consideration. The Senate has not taken up consideration of the bill yet. Medical schools and other health advocates had opposed the conference agreement, citing severe cuts to Title VII health professions programs and the minimal increase for the National Institutes of Health (NIH).

Specifically, the conference report cut the Title VII programs by $205.6 million (69%) for total funding of $94 million in FY 2006. This includes:

  • $51.8 million for the diversity training programs, a $65.9 million (56%) cut;
  • $28.2 million for primary care medicine and dentistry, a $60.6 million (68.3 %) cut; and
  • $2 million for the Area Health Education Centers, a $27 million (93%) cut.

The agreement eliminated funding for the geriatric training programs, rural health training programs and workforce information and analysis.

Also included in the conference agreement was $28.5 billion for NIH, an increase of $156 million (0.5%) above the FY 2005 level, the lowest increase in health research spending in years. The Agency for Healthcare Research and Quality received $318.7 million, the same amount provided in FY 2005. Additionally, the National Health Service Corps receives $126.8 million, a $4.7 million (3.5%) cut; the bioterrorism hospital preparedness grants were funded at $500 million for FY 2006, which is $14.6 million below last year; and the children's hospital graduate medical education program is provided $300 million, a $730,000 decrease.

Twenty-two Republicans, none from New York, joined all Democratic members in voting no on the measure. The defeat scuttled the Republican leadership’s plans to complete work on the FY 2006 spending bills before Thanksgiving. Both the House and the Senate passed a second Continuing Resolution to keep the government funded and operating until December 17th. In addition to the Labor, HHS, and Education bill, Congress still needs to complete work on the Defense Appropriations bill.



Senate Passes Labor/HHS Funding Bill, Adds Funding for New York First Responders and Pandemic Flu

On October 27th, the Senate approved, 94-3, its version of the FY 2006 Appropriations bill for the Departments of Labor, Health and Human Services (HHS), Education, and Related Agencies. The bill provides $141.7 billion in discretionary funds, plus emergency funding to help respond to a potential avian flu outbreak. It now moves to the conference committee to be reconciled with the bill passed by the House in June.

The bill includes $29.415 billion for the National Institutes of Health, an increase of $1.050 billion (3.7%) over the FY 2005 appropriation and $908 million over the House bill. The Senate bill includes $298.7 million for Title VII health professions, an $820,000 (0.3%) decrease from FY 2005. Most Title VII programs were restored to their FY 2005 funding levels, but primary care medicine and dentistry received a $1.2 million (1.3%) increase to $90 million, and geriatric programs were cut by $2 million (6.3%) to $29.5 million.

As expected, the Senate rejected a number of amendments offered to add funds to a variety of health and educational programs. Many of the amendments included no spending offsets and thus required sixty votes to waive budget points of order for exceeding the bill's spending cap.

The Senate did, however, accept an amendment offered by New York Senators Hillary Rodham Clinton (D-NY) and Charles Schumer (D-NY) that would restore $125 million in 9/11 related assistance. The funds will go towards providing health care for police, firefighters, and other first responders, including Project COPE, a program that Columbia and New York City Police Foundation run to provide mental health services to members of the New York City Police Department, civilians, and their families.

Senator Tom Harkin (D-IA) offered the avian flu amendment, adopted by voice vote, which provides nearly $8 billion to increase international surveillance of avian flu outbreaks, to enhance the vaccine production infrastructure in the United States, to build stockpiles of vaccines and antiviral medications, and to strengthen the public health infrastructure at the federal, State, and local levels. The funding was designated as emergency spending, which means it did not need to be offset and does not count against the bill's discretionary spending cap.

The Senate also adopted by voice vote an amendment by Senator John Sununu (R-NH) to increase funding for community health centers by $50 million above the Appropriations Committee's recommendation of $1.839 billion. The amendment was offset by reducing the facilities construction funds under the Health Resources and Services Administration (HRSA), the account used to fund Members' earmarks.

Other amendments adopted included one by Senator Richard Durbin (D-IL) to prevent candidates for appointment to federal scientific advisory committees from being asked to disclose their political affiliation or voting history or their positions on political issues not directly related to and necessary for the work of the committee involved. The amendment also prevents funding from the bill to be used "to disseminate scientific information that is deliberately false or misleading." Also adopted by voice vote was an amendment by Senator Patrick Leahy (D-VT) to prohibit the use of federal funds to provide abstinence education that includes information that is "medically inaccurate," which is defined as "information that is unsupported or contradicted by peer-reviewed research by leading medical, psychological, psychiatric, and public health publications, organizations and agencies."

In addition, the Senate adopted amendments to increase funding for suicide prevention activities, for the HHS Office of Minority Health and sickle cell disease, and for telehealth programs. Other approved amendments direct the HHS to purchase no less than 1 million rapid oral HIV tests and direct HRSA to provide $5 million for programs to address dental workforce needs. The Senate voted, 14-85, to reject an amendment by Senator Tom Coburn (R-OK) to transfer $60 million from the Centers for Disease Control's construction budget to the AIDS drug resistance program, and defeated, 46-53, a proposal by Senate Budget Chair Judd Gregg (R-NH) to increase funding for the Low Income Home Energy Assistance Program (LIHEAP) by $1.3 billion, paid for by an across-the-board cut of 0.9% of all discretionary programs in the bill.



Senate Panel Approves FY 2006 Funding Bill for NIH and other HHS Agencies

Continuing this year's rapid pace of appropriations work, the Senate Appropriations Committee completed its markup of the FY 2006 Labor, HHS bill (H. R. 3010) on July 14. The bill, which funds all of the Department of Health and Human Services (HHS) agencies and programs, now goes to the Senate floor. The House passed its version at the end of June.

The Senate would provide $29.6 billion to the National Institutes of Health (NIH) in FY 2006, $1.050 billion, or 3.7% above the current level of funding. This is a very different recommendation than that offered by the House, which followed the Administration's budget request by passing a bill with an increase of only 0.5%. Under the Senate mark, funding for most NIH institutes would rise between 2.8 and 3.8%.

This increase may prove difficult to sustain as the bill advances; extra funding for the higher NIH allocation was gained through a budgetary maneuver put in place by Subcommittee Chairman Arlen Specter (R-PA). Senator Specter attempted to use the same maneuver last year, only to have it rejected in final conference with the House.

HHS
(in $ Millions)
FY05 FY06
(House)
FY06
(Senate)
Senate/
FY05
NIH TOTAL 28,594 28,737 29,645 3.7%
Cancer 4,825 4,842 4,961 2.8%
NIAID 4,403 4,359 4,547 3.3%
NIHLB 2,941 2,951 3,023 2.8%
Gen. Med. Sci. 1,944 1,955 2,003 3.0%
NIDDK 1,864 1,872 1,918 2.9%
NINDS 1,539 1,550 1,592 3.4%
Mental Health 1,412 1,418 1,460 3.4%
Child Health 1,270 1,278 1,311 3.2%
NCRR 1,115 1,100 1,188 6.5%
Aging 1,052 1,057 1,091 3.7%
Drug Abuse 1,006 1,010 1,035 2.9%
NIEHS 724 728 748 3.2%
Eye 669 673 694 3.7%
Arthritis /Mus. 511 513 526 2.9%
Human Genome 489 491 503 2.9%
Alcohol Abuse 438 440 452 3.2%
NIDCD 394 397 409 3.8%
NIDCR 392 393 405 3.4%
Director’s Office 358 482 487 36.1%
NLM 315 318 327 3.8%
Bioengineering 298 300 309 3.6%
Minority Health 196 197 203 3.7%
Nursing Research 138 139 143 3.2%
Comp. & Alt. 122 123 127 4.0%
Bldgs. & Facilities 110 82 114 3.0%
Fogarty Intl. Ctr. 67 67 69 3.2%
AHQR 318.7 318.7 323.7 1.5%
CDC 4,776 6,105 6,254 30.9%


Program Details and Report Language of Note

Roadmap -- The largest increase in NIH would go to the Office of the Director, chiefly to provide 9% more in funding for clinical research, high-risk basic research, and collaborative research under the Roadmap for Biomedical Research, which would receive $333 million in FY 2006.

Health Professions -- The Senate would restore most Title VII Health Professions programs to their FY 2005 funding levels, a significant difference from the House bill, which would cut these programs 84% below their current level. Title VII authorizes a variety of grants for students, programs, and institutions to improve the racial and ethnic diversity, geographic distribution, and quality of the health care work force.

Biomedical Research and Development Price Index (BRDPI) -- The Senate Committee criticizes NIH for falling behind the biomedical inflation index in grant awards. The Senate increase should allow NIH to increase the average new grant by the 3.2% BRDPI increase next year and would keep the overall NIH budget just ahead of economy-wide inflation.

Human Embryonic Stem Cell Research -- Although making no changes to current policy, the Senate report expresses concern that "the current administration policy relating to human embryonic stem cell research is so narrow that it is stifling the pace of stem cell research." The report urges the Administration to modify the current policy to allow for an expansion of federal funding and criticizes NIH's implementation of the current policy for leading to only $24 million in NIH funding this year for HES research.

Public Access -- The Senate bill contains language that follows up on the recent NIH policy to allow public access to all NIH-funded research results by making the manuscripts of research papers available in the freely accessible NIH PubMed Central database within a year of publication. Language accompanying both the House and Senate Labor-HHS bills request NIH to prepare a progress report on the policy, including estimates of the number of peer-reviewed journal articles that have been deposited with NIH, the average delay between paper publication and public access through NIH, and an estimate for how much this policy is costing the National Library of Medicine (NLM). Both the House and Senate also include language regarding NIH's PubChem molecular library. Appropriators state their expectation that NIH "work with the private sector chemical information providers, with a primary goal of maximizing progress in science while avoiding unnecessary duplication and competition with private sector databases."



House Approves Health and Human Services Funding Bill

On June 24th, The House of Representatives approved the FY 2006 Labor-HHS-Education Appropriations bill (H.R. 3010). The House adopted the funding levels earlier recommended by the House Appropriations Committee, including a 0.5% increase for the National Institutes of Health (NIH) and the elimination of all Title VII health professions funding except for Centers of Excellence ($12 million) and Scholarships for Disadvantaged Students ($35 million).

The House approved an amendment by Rep. Randy Neugebauer (R-TX) to cancel funding for two grants supported by the National Institute of Mental Health. The House approved the proposal as part of block of amendments adopted by voice vote. One of the targeted grants, held by a researcher at the University of Iowa, deals with the "perceptual bases of visual concepts," or the understanding of vision and perception. The second grant, to a researcher at SUNY-Buffalo, focuses on "perceived regard and relationship resilience," which looks at the factors that contribute to successful marriages. In a written statement, Rep. Neugebauer said his amendment would "save federal funding for serious mental health research." Rep. Jim Leach (R-IA) spoke on the House floor against the amendment and urged the chair and ranking member of the subcommittee to address this issue in the House-Senate conference.

AAMC President Jordan J. Cohen, M.D., joined Association of American Universities (AAU) President Nils Hasselmo, Ph.D., and National Association of State Universities and Land-Grant Colleges (NASULGC) President C. Peter Magrath, Ph.D., in a June 22 letter to all House members urging them to oppose the Neugebauer amendment. The letter notes, "By protecting the scientific peer review system, which subjects research proposals to rigorous review for scientific and public health merit, Congress ensures that the highest-quality research-research that contributes directly to public health-is funded with federal dollars." The letter also states, "Some in Congress are questioning the value of research into particular aspects of human or animal behavior. However, the evidence is overwhelming that such research has been invaluable to our understanding of mental health and is essential to the prevention, management, and cure of mental illnesses and disorders."

The Senate Labor-HHS-Education Appropriations Subcommittee is tentatively scheduled to mark up its version of the FY 2006 funding bill July 12.



No FY 2006 Budget Resolution Yet

Progress on the FY 2006 budget resolution has been slowed as the Congress schedule in was thrown into a bit of disarray as a result of the Schiavo case and the Pope's funeral. The House and Senate approved differing versions of the budget on March 17. The House bill (H. Con. Res. 95) directs the House Energy and Commerce Committee and the House Ways and Means Committee to find savings of $20 billion and $18.7 billion, respectively, over five years. The bill does not specify where the cuts must come from, but the Committees must find savings in programs within their jurisdiction. Programmatic jurisdictions of the House Energy and Commerce Committee include Medicaid, Medicare outpatient services and the drug benefit, the environment and others. The House Ways and Means Committee has jurisdiction over Medicare, the Earned Income Tax Credit, welfare, child care and unemployment insurance. Given the size of both the Medicare and Medicaid program, it is likely that the savings could only be achieved through significant cuts in these programs. The Senate struck language from its version of the budget resolution (S. Con. Res. 18) that would have required the Finance Committee, which has jurisdiction over the Medicaid program, to identify $15 billion in savings over 5 years. Senators also approved amendments providing additional funds for the National Institutes of Health (NIH) and higher education programs.




Senate Panel Addresses FY 2006 NIH Funding

The Senate Appropriations Subcommittee on Labor, HHS, Education and Related Agencies held an April 6th hearing to hear testimony from National Institutes of Health (NIH) Director Elias A. Zerhouni, M.D., on the FY 2006 NIH budget. Chairman Arlen Specter (R-PA) presided over the hearing; Ranking Member Tom Harkin (D-IA) and full Appropriations Committee Chairman Thad Cochran (R-MS) were also in attendance. At the hearing Chairman Specter expressed the shared concerns of the Senate over President Bush's proposed flat funding of the NIH and reaffirmed his commitment to his amendment to the Senate version of the budget resolution (S. Con. Res. 18), which would provide the NIH an additional $1.5 billion in funds for FY 2006.

Dr. Zerhouni began his testimony by outlining recent NIH progress against disease challenges, including a 60% decrease in mortality of heart disease, an increased cancer survival rate, an Ebola vaccine, and the swift identification of SARS. National Cancer Institute (NCI) Director Andrew C. von Eschenbach, M.D., provided additional testimony on advances in cancer research at NCI, outlining the discovery of cancer subsets and its applications for treating individual cancer patients.

Dr. Zerhouni summarized the NIH's top budgetary priorities for FY 2006:

  • Increasing research project grants by $56 million, raising the number of new and competing research project grants by 247 grants to a total of 9,463;
  • Increasing funding for the NIH Roadmap for Medical Research by adding $98 million for a total of $333 million to keep this multi-year initiative on track;
  • Developing countermeasures against biological and chemical threats by increasing biodefense research by a net $56 million to $1.8 billion;
  • Providing $26 million for the Neuroscience Blueprint that supports NIH Institutes collaborating to use new tools to solve pressing public health challenges; and
  • Increasing funding for the development of a vaccine to combat HIV/AIDS by $100 million to $607 million.

Dr. Zerhouni has also requested an additional $2 million for creating an Office of Portfolio Analysis and Strategic Initiatives (OPASI) to focus attention on creating better institutional tools to analyze, assess, and manage the NIH-wide research portfolio and to provide better information to support priority-setting decisions in areas of common interest to all Institutes and Centers. The new office's contributions will include an improved process for collecting data on various diseases, conditions, and research fields, and improvements in data about burden of disease.

In a response to recent ethical questions and public trust issues, the hearing continued with questions regarding stem cell research and conflict of interest challenges. NIH Stem Cell Task Force Chairman James Battey, M.D. Ph.D., testified that there is a scientific need for use of stem cell lines derived after the current August 9, 2001 cut-off date, citing genetic changes that are inevitably occurring each time these lines are cultured. Dr. Zerhouni detailed the problems arising as a result of the new divestment policies (set to be implemented in July) to prevent conflict of interest difficulties. He has already requested a 90-day extension from the Department of Health and Human Services (HHS) and hopes refine the conflict of interest policy in order to prevent the reactive exodus of NIH scientists to venues with less stringent guidelines.

The hearing concluded with a brief discussion on what Senator Harkin referred to as "the plight of young scientists." He noted that concern has grown over the length of training and increased competition for grants that has resulted in a 23% decrease in NIH scientists under 35 years old. With rising education debt and increased competition for grants due to the flat funding of the NIH in President's proposed budget, Senator Harkin the NIH will lose talented young scientists to other organizations. Dr. Zerhouni shared this concern and indicated a retreat of all the NIH Directors has already been planned for later this year to discuss this specific issue.



Members of Congress Urge Restoration of Health Professions Funding

In an April 8th letter co-sponsored by Representatives Diana DeGette (D-CO) and Charlie Norwood (R-GA), 102 Members of Congress urged House appropriators to restore the Title VII health professions funding cut in the Administration's proposed FY 2006 budget.

Noting that the proposed decreases could "hamper the programs' ability to train health professionals to care for the neediest populations," the letter requests restoration to at least the FY 2005 level of $300 million. The letter also notes that the Title VII programs are the only federal programs designed to provide interdisciplinary training in underserved areas of the country and increase minority representation in the health care workforce.



House, Senate Approve Budget Resolutions; Senate Strikes Medicaid Cuts, Adds NIH Funds

On March 17th, the House (H. Con. Res. 95) and Senate (S. Con. Res. 18) both voted to approve differing versions of an FY06 budget resolution by votes of 218-214 and 51-49, respectively. Before final approval, the Senate adopted amendments striking proposed cuts to the Medicaid program and adding funds for the National Institutes of Health (NIH) and higher education. This sets up what is likely to be a contentious conference committee, as legislators try to reconcile differences between the two plans.

The Senate Budget Committee resolution contained language that required the Finance Committee, which has jurisdiction over the Medicaid program, to identify $15 billion in savings over five years. Sponsored by Senators Gordon Smith (R-OR), Jeff Bingaman (D-NM), Norm Coleman (R-MN), Max Baucus (D-MT), Lincoln Chafee (R-RI), Mike DeWine (R-OH), and Olympia Snowe (R-ME), the amendment struck these proposed cuts, and created a reserve fund to establish a Bipartisan Commission on Medicaid to review the program and make recommendations to improve service delivery, quality of care, and cost-efficiencies. The amendment passed 52-48. Republicans voting in favor of the amendment included Senators Smith, Coleman, Chafee, DeWine, and Snowe, Susan Collins (R-Maine) and Specter. All Democrats voted in support of the amendment.

During floor remarks related to the amendment, Senator Smith discouraged his colleagues from placing "budget ahead of policy." He urged them against acting too fast, and in "a way that will do real human damage to those who can not fend for themselves." Preceding the vote on the Smith Amendment the Senate voted to reject (49-51) "Sense of the Senate" language that had been offered by Majority Leader Bill Frist (R-TN). While the amendment stated that the Finance Committee could not report a reconciliation bill that would cap Federal spending on Medicaid, the provisions were non-binding in nature. In anticipation of the vote on the Smith Amendment the Association of American Medical Colleges sent a March 14 letter to all Senators urging them to vote in support of the amendment. Columbia reached out to New York Senators Hillary Rodham Clinton and Charles E. Schumer urging them to vote yes, which they did.

The Senate partially responded to the Administration's proposal to cut nearly a $1 billion from discretionary health programs by passing, 63-37, an amendment offered by Senator Arlen Specter (R-PA) to add $1.5 billion to Budget Function 550 for the NIH. The Specter amendment also added $500 million for education programs. The Senate also adopted 51-49 an amendment offered by Senator Edward Kennedy (D-MA) to add $5.4 billion for higher education, offset by eliminating various tax loopholes. Specifically, the Kennedy amendment calls for increasing the maximum amount of a Pell Grant award to $4,500, and provides additional funds to maintain several higher education programs targeted for severe cuts or elimination in the President's budget request including the Perkins Loan Program, TRIO and Gear Up. Senator Kennedy also intended to offer an amendment adding $3.5 billion to Function 550 for public health but ultimately withdrew the amendment.



President Bush Submits FY 2006 Budget

On February 7th President Bush unveiled the details of his FY 2006 budget request to Congress. The $2.568 trillion spending plan assumes a $390 billion deficit in FY 2006, and calls for $840 billion in discretionary spending, an increase of $17.6 billion (2.1%). Defense spending is increased by 4.8% and homeland security grows by 3.2%. All other discretionary spending is slated for a 0.5% decrease to $389 billion. The President's budget also proposes new budget reforms, including capping discretionary spending at the FY 2006 level for five years, a stricter standard for emergency spending designations and a line-item veto.

Discretionary spending within the Department of Health and Human Services is decreased by nearly $1.8 billion (2.6%) to $67.1 billion. As in previous budgets, the Administration proposes increases for a few priority programs, calls for the elimination of several programs, and freezes funding for the majority of discretionary health programs.

The following summarizes the discretionary budget proposals for programs of interest to medical schools and teaching hospitals.

National Institutes of Health: The president's budget assumes a program level for NIH in FY 2006 of $28.845 billion, an increase of $196 million (0.7%). The Administration's budget will support an estimated 9,463 new and competing renewal research project grants (RPGs), an increase of 247 competing RPGs over FY 2005. However, the total number of RPGs will decrease by 402 to an estimated 38,746. The average cost of competing RPGs is $377,000. This cost is skewed, however, by more than one hundred AIDS clinical trials cycling from noncompeting into competing status awards (average cost $2.8 million per award), as well as the fourteen G-8 HIV Vaccine awards (average cost $2.4 million per award). When adjusted for these large grants, the average cost for a competing RPG is $347,000. While no inflationary increases are provided for direct, recurring costs in non-competing RPG's, where the NIH has committed to a programmatic increase in an award, such increases will be provided.

Most stipends levels for individuals supported by the Ruth L. Kirschstein National Research Service Awards (HRSA) program are maintained at FY 2005 levels. However, stipend levels for post-doctoral fellows with 1 to 2 years of experience are increased by 4%, bringing these stipends closer to the goal NIH established for post-doc stipends in March 2000. In addition, individual post-doctoral fellows will receive an increase of $500 in their institutional allowance for rising health benefit costs. However, these increases in stipends and health insurance are financed by reducing the number of full-time training positions (FTTPs); NIH will support a total of 17,442 FTTPs in FY 2006, a decrease of 397 from the FY 2005 Appropriation.

The budget includes $30 million for construction of additional biosafety level (BSL) 3 laboratories for biodefense research. Consistent with its FY 2005 budget, the administration does not request funds for non-biodefense extramural research construction. The administration also repeats its proposal to reduce the salary cap on extramural grants to Executive Level II.

Health Professions: For the fourth consecutive year, the budget eliminates all funding for the Title VII health professions programs, with the exception of $10 million for Scholarships for Disadvantaged Students and $1 million for Workforce Information and Analysis. Title VIII nursing receives level funding with FY 2005 at $150 million. The children's hospital graduate medical education program receives a cut of $101 million (33%) below last year's level of $301 million.

National Health Service Corps: The Administration's budget request includes $127 million for the National Health Service Corps (NHSC), a decrease of $5 million from the FY 2005 level. This decrease is the result of proposed administrative cost savings, and the number of awards is anticipated to remain the same.

Preparedness: The Health Resources and Services Administration (HRSA) Bioterrorism Hospital Preparedness program is cut by $8 million to $483 million in the President's budget, while funding for the Bioterrorism Curriculum Development program is level funded at $28 million. The State Bioterrorism Preparedness program administered by the Centers for Disease Control and Prevention (CDC) is cut by $130 million to $797 million. Also within CDC, $203 million is added to the Strategic National Stockpile.

AHRQ: The Agency for Healthcare Research and Quality (AHRQ) receives level funding at $319 million, with all funds allocated via transfers from other public health service agencies. The budget designates $50 million for health information technology, $34 million for patient safety, and $15 million for comparative effectiveness research.

Health IT: Outside AHRQ, the FY 2006 budget includes $75 million for the new Office of the National Coordinator for Health Information Technology. Although Congress did not provide funding for this initiative in the final FY 2005 budget, the Administration has directed $50 million in FY 2005 funds from the Secretary's discretionary budget.

VA Research: The President's proposal includes $393 million for the direct costs of research in the Department of Veterans Affairs medical and prosthetics research program, a decrease of $9.3 million (2.3%). The budget again assumes the combination of the direct and indirect components of the research program into a single research business line, with a total of $786 million. The budget also proposes to establish three new performance measures for the VA research program: the percentage of clinicians who remain paid VA employees at least three years after completion of a career development award; the annual number of patent disclosures filed by VA investigators; and the annual number of peer-review publications that show VA listed as the affiliated institution.

VA Medical Care: The FY 2006 budget request includes $30.7 billion for VA medical care, an increase of $752 million (2.5%). However, this figure includes $2.59 billion in collections and revenue generated through proposed legislation. With all collections and new revenue sources removed from the calculation, the budget request includes $28.1 billion for medical care, an increase of $117 million (0.04%).

National Science Foundation: The Administration's FY 2006 budget proposal includes $5.61 billion for the National Science Foundation (NSF), an increase of $132 million (2.4%). This figure includes $4.33 billion for NSF Research and Related Activities, an increase of $113 million (2.7%).

Higher Education: The President's budget request also includes several proposals related to the reauthorization of the Higher Education Act. Proposals of particular interest to medical schools and teaching hospitals include:

  • Eliminating the Perkins Loan Program and reclamation of the federal portion of the revolving fund;
  • Increasing annual subsidized Stafford loan limits for freshmen to $3,500 and for sophomores to $4,500;
  • Increasing annual unsubsidized Stafford loan limits for graduate and professional students to $12,000;
  • Maintaining current variable interest rate on Stafford loans;
  • Replacing the current fixed-rate formula on consolidation loans with a variable rate;
  • Allowing reconsolidation on multiple occasions subject to a 1 percent borrower origination fee; and
  • Eliminating the single holder rule.

Congress Completes Work on FY 2005 Budget

After stripping out a controversial provision that would have allowed certain Congressional staff access to individuals' tax returns, Congress approved a $388.4 billion omnibus spending package that incorporates the nine regular FY 2005 appropriations bills not yet enacted into law. President Bush is expected to sign the bill. The House passed the conference agreement on November 20th by a vote of 344 to 51 and the Senate passed the package 65 to 30 later the same day, but only after adding a provision to strike the tax return proposal. The House was expected to approve the amended resolution November 24th under unanimous consent; however, House Minority Leader Nancy Pelosi (D-CA.) objected, saying Democrats would not agree to a vote until, "after the rest of the spending bill can be examined." The House did return on December 6th to approve the technical corrections resolution, releasing the omnibus bill to the President.

The final spending package, which was incorporated into H.R. 4818, the Foreign Operations Appropriations bill, complies with the overall spending target for FY 2005 agreed to by the Congress and the Administration. This represents a freeze in non-defense discretionary spending. Additional spending added to the conference agreement was offset in part by the across-the-board cut in all non-defense and non-homeland security spending. The following provisions cover programs of interest to medical schools and teaching hospitals. All funding totals presented in this summary include the 0.80% across-the-board cut.

National Institutes of Health (NIH): The conference agreement appropriates $28.371 billion for NIH, an increase of $571 million (2.1%) over the FY 2004 level. The bill provides $30 million through the National Center for Research Resources for extramural research facilities construction and renovation. The House bill proposed no funding for this program; the Senate bill included $119.2 million, the same as in FY 2004. The conference agreement also provides $150 million through the National Institute for Allergy and Infectious Diseases for constructing BSL-3 laboratories.

The conference agreement retains the cap on extramural salaries for NIH, as well as the Substance Abuse and Mental Health Services Administration and the Agency for Healthcare Research and Quality, at Executive Level I ($175,700 in 2004).

On the issue of public access, the conference report states, "The conferees are aware of the draft NIH policy on increasing public access to NIH-funded research.” Under this policy, NIH would request investigators to voluntarily submit electronically the final, peer reviewed author's copy of their scientific manuscripts; six months after the publisher's date of publication, NIH would make this copy publicly available through PubMed Central. The policy is intended to help ensure the permanent preservation of NIH-funded research and make it more readily accessible to scientists, physicians, and the public. The conferees note that the comment period for the draft policy ended November 16th; NIH is directed to give full and fair consideration to all comments before publishing its final policy. The conferees request NIH to provide the estimated costs of implementing this policy each year in its annual Justification of Estimates to the House and Senate Appropriations Committees. In addition, the conferees direct NIH to continue to work with the publishers of scientific journals to maintain the integrity of the peer review system."

The conference agreement does not include a provision in the House bill to stop funding for two grants supported by the National Institute on Mental Health. The Senate bill did not contain a similar provision. The conferees "reiterate their support of the two-tiered peer review process used by NIH to judge research grant applications and continue to expect NIH to ensure that its funds are allocated to research that is both scientifically meritorious and has high potential public health impact."

Health Professions: The final bill provides $299.6 million for the Title VII health professions education programs for FY 2005, an increase of 1.8% over last year. The only programs to receive an increase are the primary care medicine and dentistry programs, which receive $88.8 million, an 8.6% increase. All other programs, including Scholarships for Disadvantaged Students, AHECs, geriatric training programs, and workforce information and analysis received level funding. The Title VIII nursing programs received $150.7 million for FY 2005, a 6.2% increase.

Children's Hospital's Graduate Medical Education (GME): The children's hospitals GME program is funded at $300.8 million, a 0.8% decrease from FY 2004.

Council on Graduate Medical Education: The conference report includes language to permit the Health Resources and Services Administration to continue funding for COGME through FY 2005.

National Health Service Corps: The omnibus agreement provides $131.5 million for the National Health Service Corps, a reduction of $38.4 million (22.6%) from the previous year. The accompanying report language indicates that the reduction is not expected to result in fewer awards because HRSA will no longer provide additional payments to cover the tax burden associated with loan repayment awards. The corporate tax relief bill enacted earlier this year exempted such awards from federal income taxes.

Agency for Healthcare Research and Quality: AHRQ is funded at $318.7 million for a $15 million increase (5%) over last year. Report language dictates that the additional funds are to be used for clinical effectiveness research, as authorized in the Medicare Modernization Act. As all funds for AHRQ are derived from transfers from other Public Health Service agencies, this funding is not subject to the 0.80 across-the-board cut.

Centers for Disease Control and Prevention: The omnibus agreement appropriates $4.498 billion for the Centers for Disease Control and Prevention (CDC), an increase of $130 million (3%) over FY 2004.

Bioterrorism Preparedness: The final bill provides $1.164 billion for the CDC ($58 million over FY 2004), which includes $396.8 million for the Strategic National Stockpile, $926.9 million for state and local preparedness, $141.1 million for upgrading CDC capacity, $79.4 million for biosurveillance activities, and $16.7 million for anthrax vaccine research. The HRSA Hospital Bioterrorism Preparedness program receives $491.4 million, a $26.6 million (5.2%) decrease below FY 2004. The curriculum development program receives $27.5 million, level with last year. Another $47 million is directed to the NIH for research on countermeasures.

Health Information Technology: The final conference agreement does not include funds for Health Information Technology within the Secretary's office. The Administration had requested $50 million, while the House bill provided $25 million for this purpose.

Veterans Medical Care: The FY 2005 omnibus agreement includes an appropriation of $27.7 billion for veterans’ medical care, an increase of $1.26 billion (4.7%) over FY 2004. The conference agreement assumes an additional $2 billion in third-party collections.

Veterans Medical Research: The omnibus agreement provides $402.3 million for the VA Medical and Prosthetics Research program, a decrease of $3.24 million (0.8%).

National Science Foundation: The omnibus agreement includes $5.47 billion for the National Science Foundation (NSF), a reduction of $105 million (1.9%) from FY 2004. This total includes $4.22 billion for NSF Research, a cut of $30.8 million (0.7%).

75 Percent Rule: Section 219 of the Labor-HHS portion of the bill delays implementation of the April 30, 2004, Final Rule that revises the criteria Medicare uses to classify hospitals as inpatient rehabilitation facilities (the so-called "75 Percent Rule"). The revisions would reduce Medicare payments for some rehabilitation facilities. The AAMC and twenty nine other provider and patient advocacy organizations had supported adoption of the delay, which would apply to Inpatient Rehabilitation Facilities certified on or before June 30, 2004. Under Sec. 219, the Secretary of Health and Human Services may not expend funds to implement the Final Rule until the Government Accountability Office (GAO) issues a study and recommendations regarding "clinically appropriate standards for defining inpatient rehabilitation services." Once the study is released, the Secretary has 60 days to determine whether the Final Rule is consistent with the GAO recommendations and to revise the IRF classification criteria accordingly.

Foreign conferences: The conference agreement does not include a general provision proposed by the House limiting the attendance of HHS employees at foreign conferences. The Senate bill did not contain a similar provision. The conferees state they "are pleased that in the current constrained fiscal environment, the Secretary of HHS has taken steps to monitor and limit travel by HHS agency employees to international conferences. The Secretary should, however, ensure that all necessary U.S. scientists are permitted to attend important international scientific meetings to present their research findings and to learn about research being conducted in other countries."

H-1B Visas: The omnibus bill also contains several provisions related to H-1B visas. Individuals that have earned masters or higher degree from a U.S. institution of higher education will not be counted against the annual cap on H-1B visas; however, this exemption is limited to the first 20,000 eligible applicants. Additionally, all sponsoring employers will now be required to pay a new $500 fee for fraud prevention and detection at the time of the initial application and if the individual changes employers.


Congress Adjourns for Election; Leaves Spending Bills in Limbo

Congress has adjourned until after the election, putting off final decisions on domestic spending for FY 2005 until at least mid-November when the House and Senate return to Washington for a lame duck session. The chairmen of both the House and Senate Appropriations Committees have been predicting for months that the combination of tight spending limits and a congressional schedule compressed by primaries and the conventions would make it difficult to pass any spending bill other than those covering essential defense and homeland security efforts before the election. The federal fiscal year began October 1st, but, prior to adjourning, Congress completed action on only four of the thirteen regular appropriations bills. As a result, non-defense federal programs are currently operating under a continuing resolution (CR) until November 20th. The CR provides appropriates money to fund programs at FY 2004 levels. The CR also includes language extending various authorizations set to expire. For example, it permits continuation of Medicare cost sharing for Part B premium assistance. Programs, activities, eligibility requirements, and advisory committees authorized under the Higher Education Act of 1965 through FY 2004 also will remain in effect through November 20th.

The remaining appropriations bills are expected to top the congressional agenda for the lame-duck session scheduled for November 16th; however, legislators may struggle to complete action on the bills, as lame duck sessions are often non-productive in the absence of a compelling deadline. In addition, House and Senate leaders disagree vigorously about the various accounting maneuvers employed by the Senate Appropriations Committee to provide additional funds for the two major bills of interest to academic medicine: Labor-HHS-Education and VA-HUD-Independent Agencies. Although most of Congress’s attention was devoted to the appropriations bills, they did manage to finalize and pass significant tax/trade legislation and make progress on an intelligence overhaul bill.



House and Senate Take Action on Health Spending

Both the House of Representatives and the Senate made progress on the appropriations bill that funds the Departments of Labor, Health and Human Services and Education, often referred to as the “Labor/HHS bill.” On September 10th the House approved its version of the FY 2005 Labor/HHS bill (H.R. 5006; H. Report 108- 636). A week later the Senate Appropriations Committee voted out its bill (S. 2810, S. Rpt. 108-345).

The House agreed to an amendment by Congressmen Frank LoBiondo (R-NJ) and Zach Wamp (R-TN) and Congresswoman (Nita Lowey) that prohibits the Centers for Medicare and Medicaid Services (CMS) from implementing the so-called "75 percent Rule,” a proposal that would reduce Medicare payments for some rehabilitation hospitals, until a General Accountability Office (GAO) study is completed on the issue. Additionally, the House rejected by voice vote an amendment sponsored by Congressman Tom Tancredo (R-CO) that would have prevented the distribution of Medicare Modernization Act (MMA) funds to hospitals, physicians, and ambulance services that treat large numbers of undocumented immigrants.

The House did adopt by voice vote an amendment by Rep. Randy Neugebauer (R-TX) to prohibit further funding for two specific grants supported by the National Institute of Mental Health. House Labor/HHS Appropriations Subcommittee Chairman Ralph Regula (R-OH) spoke against Congress intervening in individual grant funding decisions but ultimately did not oppose the amendment since funding for the grants has already ended. Although passage of this amendment may have no practical effect as both grants had expired, it did set a dangerous precedent of Congress overruling the judgment of the NIH and undermining the peer review process.

The House rejected by a vote of 79 to 333 an amendment offered by Rep. Joel Hefley (R-CO) that sought to reduce the overall funding level of the bill by 1%. Several members of Congress, including Michael Castle (R-Del.) and Randy "Duke" Cunningham (R-Calif.) made statements in support of expanding the Administration's policy on federal funding for research using embryonic stem cells.

The Senate bill provides additional funding for the National Institutes of Health (NIH) and the Title VII health professions education programs beyond what is included in the appropriations bill passed by the House. For NIH, the Senate bill includes $28.9 billion, an increase of $1.1 billion (4%) over the current year and about $373 million more than the House-passed bill and the President's budget request. The Senate bill provides the National Center for Research Resources (NCRR) with level funding of $119 million for extramural research facilities construction; the Administration had proposed eliminating the program. The Senate bill retains the salary cap for extramural grants from NIH, the Agency for Healthcare Research and Quality (AHRQ) and for the Substance Abuse and Mental Health Services Administration (SAMHSA) at Executive Level I.

The Senate bill provides $303 million for the Title VII health professions education programs, an increase of $9.3 million (3.2%) above FY 2004, and $34 million more than in the House bill. For the National Health Service Corps, the Senate bill provides $173.1 million, which is $3.2 million (1.9&) above the FY 2004 level and the House bill. For AHRQ, the Senate bill includes $318.7 million, an increase of $15 million over the current year and the House bill.

The Senate bill provides $503.6 million to HRSA for bioterrorism activities, $39 million less than FY 2004. This includes $475.9 million for hospital preparedness and $27.7 million for curriculum development and training. For the Centers for Disease Control and Prevention (CDC), the Senate bill provides $4.539 billion, an increase of $171 million (3.9%).

Like the House, the bill includes a provision prohibiting the Centers for Medicare and Medicaid Services (CMS) from implementing the 75 Percent Rule. Committee report language directs the Secretary of Health and Human Services to contract with the Institute of Medicine to study and make recommendations on a clinical consensus on how to "modernize the Medicare criteria used to distinguish an inpatient rehabilitation facility from an acute care hospital and other providers of intensive medical rehabilitation, and the appropriate medical necessity criteria for determining clinical appropriateness of inpatient rehabilitation admissions." The report is due no later than Oct. 1st, 2005.

Complicating the final fate of the bill is the issue of overtime regulations. Also like the House, the Senate committee adopted an amendment to block the Administration's new rules on overtime eligibility standards, which became effective Aug. 23. The White House has threatened to veto the bill if the amendment is included in the final conference agreement on the bill.



Congress Returns from Summer Recess to Tackle Remaining Appropriations Issues

As noted in prior updates, the Appropriations Committee has drafted all of the thirteen funding bills that provide for the Federal government's activities, sending ten to the floor for approval. The picture for the process overall is, however, far from clear, with debate of the bills funding the largest research and development (R&D funding agencies such as the National Institutes of Health (NIH), the National Science Foundation (NSF), the Department of Energy (DOE), the Department of Homeland Security (DHS), National Oceanic and Atmospheric Administration (NOAA), and the National Aeronautics and Space Administration (NASA) not yet having begun and only four bills even drafted in the Senate. The most likely scenario going into September is that the Senate will delay action on its bills, and aside from those funding the Departments of Homeland Security and Defense, agencies will not receive their final budgets until after the election, when Congress would return for a lame-duck session to vote on an omnibus appropriations bill. Agencies will, however, function with continuing resolutions at current funding levels.

Regardless of when the bills are finally completed, restraints on discretionary spending make it likely that non-defense R&D budgets will be flat at best, aside from a modest increase for biomedical research at the NIH. Cuts in NSF, NASA, NOAA, and other major R&D funding agencies were all included in the House bills. The picture for the Department of Defense (DOD) and the Department of Homeland Security (DHS) is far brighter, with both R&D overall and basic research budgets rising. The House would match NIH's request for a $28.8 billion budget next year, a 2.6% increase, but well short of the 15% annual increases of a few years ago. According to an estimate prepared by the American Association for the Advancement of Science, under the House recommendations, the federal investment in overall non-defense R&D would only increase by $111 million (0.2%), abut $1.1 billion less than the Administration's budget request.

Further information about several major federal R&D programs follows.

NIH

On July 14th, the House Appropriations Committee passed the FY 2005 Labor, Health and Human Services, Education and Related Agencies Appropriations Act, the spending bill that provides for the NIH. The House plan would provide $28.8 billion, a 2.6% increase that largely matches the Administration's request.

Most NIH institutes would receive increases in a narrow range between 2.8% and 3.3%. Funds needed to expand NIH's Roadmap for Medical Research would be provided. The House appropriation would allow a record 37,744 Research Project Grants, an increase of 1.4% over the current year.

NSF

On July 22nd , 2004, the House Appropriations Committee completed its work on the Veterans' Affairs, Housing and Urban Development, and Independent Agencies (VA HUD) Appropriations Act, the bill that provides funding for the Foundation. Despite strong support for the NSF by many in Congress, the need to hew to tight limits on discretionary spending while providing increases for veterans' medical care and HUD's Section 8 rental housing vouchers, two large and politically important programs funded in the bill, forced the Committee to recommend a cut of 2%, or $111 million from current year funding. Science advocates are hopeful that some of this cut can be restored by the Senate, which has greater flexibility in dealing with budgetary limits through various maneuvers, when it takes up its version of the VA HUD bill.

The committee set the NSF's budget for 2005 at $5.47 billion. This is $278 million below the level requested by President Bush and $111 less than the agency's 2004 budget. The House would impose cuts of 2.3% on the Research and Related Activities (R&RA) account, which funds most of NSF's R&D. R&RA funding would fall $100 million to $4.2 billion. The various research directorates would fall between 2% and 3%, except for Social, Behavioral, and Economic (SBE) Sciences, which would see a 5.3% increase and the Office of Polar Programs, which would receive the full budget request for a 2.2%. These decreases are likely to cause a notable fall in the total number of research grants funded.

NSF's Education and Human Resources (EHR) programs would receive $843 million, down more than 10% from this year. Most of the decline is due to the shift in Math and Science Partnerships (MSP) funding to the Department of Education. The Major Research Equipment and Facilities Construction (MREFC) account would receive an increase sufficient to fund most of the Administration's request, rising to $208 million from $155 million this year. Funding is provided to start two new projects, the Scientific Ocean Drilling Vessel program, which would receive $30 million, and the Rare Symmetry Violating Processes (RSVP) project, which also receives $30 million. Columbia teams have leading roles in both these projects. The other start proposed in the budget, the National Ecological Observatory Network (NEON) was unfunded, although $6 million was provided for planning in design in R&RA. The House would increase funding for the IceCube Neutrino Detector Observatory, from $42 million this year to $51 million in FY 2005 in order to accelerate the project's timetable. ALMA and EarthScope receive approximately the budget requests of $49.7 and $47.3 million respectively.

DOE

The House alone has advanced an energy appropriations bill so far. The House bill, which passed on June 25th, would give $8.9 billion for R&D in the Department of Energy in FY 2005, an increase of $141 million or 1.6%. DOE's Office of Science would have an R&D budget of $3.3 billion in FY 2005, a boost of 4.4% or $141 million. The House would add funds for high-performance computing research, domestic fusion research, increased operating time at user facilities, and nanoscale science but would refrain from the traditional addition of earmarked projects. DOE's energy R&D programs would decline 8.3% to $1.3 billion.

DOD

The allocation for Research, Development, Test and Evaluation (R, D, T, & E) would increase to a record level of about $70.3 billion. While most of the increase would go programs that support the development of weapons systems, Congress would also significantly increase funding for the budget activities that support university-based research above both those of last year and those called for in the Administration's budget proposal. Under the Administration's request, DOD's "6.1" (basic research) and "6.2" (applied research) activities combined would have fallen by 10.6% to $5.2 billion in FY 2005. But Congress’s final product, which the President has signed into law, provides a total of about $6.462 billion for the DOD 6.1 and 6.2 accounts, an increase of 10.9% over the current year. Considering basic research alone, the total of all 6.1 accounts (i.e. the aggregate of the individual service and defense-wide amounts) would increase by $109.3 million, or 7.8%.

DHS

Work on the appropriations bill for DHS has advanced in both chambers, with the Senate appropriations committee completing its work on June 17th and the full House passing the measure one day later. The House would give the Department of Homeland Security (DHS) a dramatically expanded R&D budget of $1.2 billion in FY 2005, up $200 million or 19.3% from this year. The Senate would provide a similar $1.2 billion, up 17.2%. Both the House and the Senate would add funds to the DHS request for university programs, interoperable communications, shipping container security, and air cargo security technologies. In addition to its R&D funds, DHS has already received $885 million in FY 2004 and $2.5 billion in FY 2005 for Project BioShield, a procurement program to purchase biodefense countermeasures that is designed to encourage private-sector biodefense R&D investments.

NASA

Only the House Appropriations committee has completed its work on the bill that funds NASA. The FY 2005 total NASA budget of $15.1 billion in the House plan would be $229 million less than this year and $1.1 billion short of the request. The House plan would cut new initiatives first in order to spare existing NASA programs, thus decimating the budgets for the new moon and Mars programs in order to preserve as much of NASA's current program funding as possible. Still, overall NASA R&D would fall by 6.2% or $674 million to $10.2 billion. The Exploration, Science, and Aeronautics (ESA) account, which funds most of NASA's research, would fall 2.7% from the current year, to $7.6 billion.


Washington Update

As the House and Senate adjourned for the Republican and Democratic conventions and the summer recess, both have made progress on the appropriations process for FY 2005, despite not having a budget resolution. The House and Senate could not agree on a resolution because of a dispute over so called “pay go” provisions. Both the House and Senate agreed to include a requirement that all future spending be offset by spending cuts elsewhere in the budget, but moderate Republican Senators—Olympia Snowe (ME), Susan Collins (ME), John McCain (AZ), and Lincoln Chaffee (RI) insisted that the pay-go requirements apply to future tax cuts as well. House Republicans would not agree to this as they want to make it as easy as possible to enact future tax cuts. Without these four votes, the Senate Republican majority could not pass a budget resolution as all but one Democrat voted against it.

Nonetheless both the House and Senate did forge ahead as the beginning of the next fiscal year is only two months away. Before adjourning, Congress cleared the Defense Department appropriations bill for the President’s signature and the House has passed nine of the remaining twelve bills and considered the other three in committee. The Senate has only passed Defense but has completed committee work on three others. The House appropriations bill for the Department of Labor, Health and Human Services, and Education, includes a $782 million increase for the National Institutes of Health, only a 2.8% increase, and also includes a 8% cut to the title VII health professions education programs. This bill is historically the most controversial as it can get caught up in abortion issues. A separate House appropriations bill contains a 2% cut for both the National Science Foundation and NASA.

Last year, only three of thirteen bills were signed into law by the beginning of the fiscal year; seven continuing resolutions were needed in order to keep the government operating and the final bill was not signed into law until January of 2004. With this year being election year it is once again highly unlikely that Congress will complete work on this year’s spending bills in a timely fashion. It will be November at the earliest before everything is resolved.



FY 2005 Budget on Hold Until After Recess

Negotiations on the FY 05 budget resolution (H.Con.Res. 95 ) have been put on hold until Congress reconvenes the week of April 19. At that time, Republicans will again try to resolve their differences over the extent to which future tax increases must be offset by spending cuts or other revenue increases.

The Senate version of the budget resolution would reinstate rules calling for such offsets unless 60 members of the Senate agree to waive the requirement. The House GOP leadership, concerned about the impact of this proposal on future tax cuts, is opposed to the provision. Office of Management and Budget Director Joshua Bolten reiterated the White House's objection to the Senate provision.

The White House April 2 sent to Congress a budget enforcement proposal that does not require offsets for additional tax cuts. The Administration plan would impose statutory limits on discretionary spending, beginning in FY 04, and create a "firewall" to prevent appropriators from shifting funds between defense and non-defense programs. The House is scheduled to vote before Memorial Day on a budget enforcement bill (H.R. 3973 ) that would require offsets for additional mandatory spending, but not tax cuts, and would cap discretionary spending, but not create a firewall to protect defense spending.



House and Senate Move Forward with FY 2005 Budget
(excerpted from AAMC reports)

On March 17th the House Budget Committee passed its version of the FY 2005 budget blueprint after approving a proposal to give federal spending controls the force of law. By a party-line vote of 24 to 19, the committee approved its FY 2005 budget resolution, after rejecting a number of Democratic amendments to add funds for a variety of programs. The committee's budget would freeze domestic spending at FY 2004 levels and fully fund the President's request of $401.7 billion for defense. The plan also calls for a budget-reconciliation bill to permit consideration of $138 billion in tax cuts over five years and to instruct authorizing committees to identify $13.2 billion in savings from mandatory spending programs over the next 5 years.

Among the amendments rejected by the committee were proposals by Congresswoman Tammy Baldwin (D-WI) to link the NIH budget to the rate of inflation to protect the agency's purchasing power (defeated 23 to 17), and by Congressman Chet Edwards (D-TX) to add $2.5 billion for veterans medical care (defeated 21-16). The committee also rejected an amendment by Congressman Mike Thompson (D-CA) to require offsets for any new tax cuts or entitlement spending increases.

Prior to approving the budget resolution, the committee passed the Spending Control Act of 2004 (H.R. 3973 ), which requires caps on discretionary spending through FY 2009. The bill also extends through FY 2009 the pay-as-you-go provisions that require any increases in mandatory spending to be offset by reduction on other spending, and not financed by raising taxes. However, the committee rejected an effort to require additional tax cuts to be offset.

One week earlier the Senate approved its version of the FY 2005 budget resolution (S. Con. Res. 95 ) by a vote of 51-45. Senators adopted an amendment to strike language regarding Medicaid cuts, and an amendment to add an additional $1.3 billion to the NIH. In a late night vote on March 10, Senators adopted 53-43 an amendment sponsored by Senator Max Baucus (D-MT) that struck from the budget resolution language a directive that the Senate Finance Committee write legislation that would have effectively required $11 billion in cuts to Medicaid. Eight Republicans supported the amendment: Kit Bond (MO), Lincoln Chafee (RI), Norm Coleman (MN), Susan Collins (ME), Mike DeWine (OH), Gordon Smith (OR), Olympia Snowe (ME), and Arlen Specter (PA); Zell Miller (GA) was the only Democrat to oppose the amendment.

As part of a Thursday evening vote-a-rama, the Senate also passed an amendment sponsored by Senator Specter to add an additional $1.3 billion to the NIH. The amendment passed by a vote of 72-24, bringing the resolution’s total recommendation for the NIH to $29.9 billion, an increase of 7.2%. The amendment was offset by a one sixth of one percent cut to Function 920 (Allowances), which covers travel and administrative expenses throughout the federal government. The original version of Senator Specter’s amendment would have added $2 billion to the budget resolution for public health, including $771for the National Institutes of Health (NIH), $508 million for the Centers for Disease Control and Prevention (CDC), and $721 million for the Health Resources and Services Administration (HRSA), including restoration of the President’s proposed cuts to the health professions programs.

Senators rejected an amendment sponsored by Senators Tom Harkin (D-IA) and Dianne Feinstein (D-CA) that sought to increase funding for public health by raising the federal tobacco tax by a vote of 64-32. Specifically, the amendment would have increased the federal tobacco tax by $0.61 to $1.00, which was expected to generate $8 billion in revenue, $6 billion of which would be directed to public health programs under Function 550 (Health) of the budget resolution. This equals the recommendation that many health groups have been supporting to provide a 12% increase to the overall discretionary health budget. The remaining $2 billion would be dedicated to deficit reduction.



President Bush Releases FY 2005 Budget
(excerpted from AAMC reports)

On February 2nd, President George W. Bush submitted his FY 2005 budget proposal to Congress. The $2.4 trillion spending plan calls for calls for $818 billion in discretionary spending in FY 2005, an increase of $31 billion (3.9%). Defense spending is increased by 7.1% and homeland security grows by 9.7%. Other domestic discretionary spending is slated to increase by 0.5% to $386 billion. The president's budget also proposes new budget enforcement mechanisms, including statutory controls to limit the growth of both discretionary and mandatory spending.

Discretionary spending within the Department of Health and Human Services is decreased by $1.1 billion (1.6%) to $68.2 billion. As in previous budgets, the Administration proposes increases for a few priority programs, calls for the elimination of several others, and freezes funding for the majority of discretionary health programs. The following summarizes the budget proposals for programs of interest to medical schools and teaching hospitals.

  • National Institutes of Health (NIH): The president's budget includes $28.6 billion for NIH, an increase of $729 million (2.6%). This includes $80 million to be appropriated through the VA-HUD appropriations subcommittee, but does not include $150 million for Type I diabetes research appropriated by Public Law 107-360 and $47 million for research in radiological and nuclear countermeasures appropriated through the Public Health and Social Services Emergency Fund. If these latter items are added, the program level for NIH is $28.8 billion, an increase of $763 million (2.7%) over the comparable total in FY 2004. The Biomedical Research and Development Price Index for FY 2005 is projected at 3.5%.

    The president's budget would fund a total of 39,986 research project grants (RPGs) in FY 2005, an increase of 558 over the current year. This includes 10,393 new and competing renewal RPGs, an increase of 258. NIH estimates this would provide for a success rate of 27% in FY 2005, equal to the projected FY 2004 success rate. However, the grants numbers are sustained by smaller than usual increases in the average cost of the grants. The budget calls for an aggregate 1.3% increase in average cost of RPGs. NIH will provide average cost increases of 1.9% for direct recurring costs in non-competing continuation awards; competing RPGs will receive an average increase of 1%.

Stipends for pre-doctoral and post-doctoral recipients of the Ruth L. Kirschstein National Research Service Awards will remain at FY 2004 levels. A total of $764 million is included for research training, a $15 million (2%) increase.

Once again, the budget proposes to reduce the cap on salaries on extramural grants from Executive Level I ($174,500 in 2004) to Executive Level II ($157,000). The budget does not include funds for extramural research facilities grants through the National Center for Research Resources, which was funded at $119 million in FY 2004. HHS notes that $633 million has been appropriated for non-biodefense extramural construction projects over the past 10 years. The budget does propose $150 million to fund the construction of an additional 20 BSL-3 laboratories for biodefense research in metropolitan areas across the country. Funding for the NIH Roadmap in FY 2005 is set at $237 million, an increase of $109 million over the current year.

  • Health Professions Programs: Similar to last year, the president's budget proposes $11 million for the Title VII health professions programs within HRSA, a 96% cut below FY 2004. Of this total, $10 million is for Scholarships for Disadvantaged Students (79% decrease) and $1 million for health workforce information and analysis (39% increase).

    The budget provides $147 million for Title VIII nurse training programs, $5 million more than FY 2004. This includes $42 million for basic nurse education and retention, $10 million more than FY04; $21 million for diversity, a $5 million increase; $44 million for advanced nursing, a $15 million cut; $32 million for loan repayments and scholarships, a $5 million increase; and $8 million for geriatric education and faculty loan repayment, about level with last year.

  • National Health Service Corps (NHSC): The president's budget includes $205 million for the NHSC, an increase of $35 million (20.6%).

  • Agency for Healthcare Research and Quality (AHRQ): The budget provides level funding for AHRQ at $303.7 million, with all monies derived from transfers from other agencies. Funding designated for patient safety research is increased from $80 million to $84 million.

  • Bioterrorism Preparedness: The HRSA Bioterrorism Hospital Preparedness program receives $476 million in the president's FY 2005 budget, a $39 million (7.5%) cut below FY 2004 funding. The bioterrorism curriculum development grants are allotted $28 million in the budget, level with current funding.

    The budget also includes $1.1 billion for the state preparedness programs administered by the Centers for Disease Control and Prevention (CDC), the same level as current funding. The president's new $274 million surveillance initiative - coordinated by the CDC, the Department of Homeland Security (DHS), the Food and Drug Administration, and the Department of Agriculture - is designed to enhance surveillance in human health, hospital preparedness, state and local preparedness, vaccine research and procurement, animal health, food and agriculture safety and environmental monitoring. Provided under the DHS FY 2005 budget is new money for Project Bioshield, the administration's plan for stockpiling vaccines to counter a biological or chemical attack. It is proposed to receive $2.5 billion in FY 2005, three times the $890 million provided by Congress in FY 2004.

  • Other HRSA Programs: The budget includes $303 million for Children's Hospitals Graduate Medical Education, the same funding as in FY 2004. The $35 million increase in the $2.08 billion Ryan White AIDS FY 2005 budget is directed for the AIDS Drug Assistance Programs, bringing it to $784 million. Rural health programs are cut by $91million (63%) to $52 million in FY 2005, with the budget document citing the $9 billion in rural health resources provided in the Medicare reform bill as balancing this cut. The budget includes $10 million (a $94% cut) for the Community Access Program (CAP), a program that seeks to enhance access through collaborative networks of providers. The traumatic brain injury ($9 million), poison control ($44 million) and tele-health programs ($4 million) are slated to receive flat funding in FY 2005.

  • National Science Foundation: The president's FY 2005 budget proposal includes $5.75 billion for the NSF, an increase of $170 million (3.1%). This includes $4.45 billion for NSF research, an increase of $200 million (4%).


New Fiscal Year Begins, Some Progress Made on Appropriations Bills

October 1st brought with it the first day of the new federal fiscal year 2004. To mark the occasion, President Bush signed the Department of Defense (DOD) and Homeland Security Appropriations Bills into law. In doing so, this left only ten of the thirteen annual appropriations bills yet to be finished. Congress did pass a Continuing Resolution that will keep the entire government funded until the end of October.

The DOD bill continued funding for a program in which Columbia has a strong interest. The Continuous Assisted Performance (CAP) program funds research into, among other things, how to protect our men and women in uniform from the adverse effects of sleep deprivation. Columbia, led by Dr. Holly Lisanby and her team, is doing some very valuable work in this area.

President Bush had requested $35 million for the entire program and the House had agreed, but the Senate cut all funding for the program. The final version of the bill, which the President signed, included $26 million. Columbia helped put together a national, bipartisan effort to restore funding, and although funding was less than the President requested, CAP will be able to continue.

One bill that Congress is still working on is the funding bill for the Departments of Labor, Health and Human Service, Education, and Related Agencies. During consideration on the Senate floor, Arlen Specter (R-PA) and others offered an amendment to increase funding for the National Institutes of Health by $1.5 billion. Although a majority of Senators voted for the Amendment, it did not receive the sixty votes it need to overcome the point of order that was raised against it. Senator Specter sought to have the additional funding money be declared emergency spending, thus obviating the need for an offset. Columbia and over 500 other institutions supported him in this effort but he did fall short.



Congress Returns to a Full Agenda

Returning from its traditional August recess, Congress began to tackle several key issues that it hopes to address before adjournment. Members spent much of the month back in their home districts meeting with and listening to constituent concerns on a number of matters. At the top of the agenda will be completing work on appropriations bills. The federal government is funded by a series of thirteen appropriations bill that each deal with a myriad of different subjects from defense to transportation to health. The federal fiscal year begins October 1st, but the process is often delayed beyond that deadline. In 2002, none of the bills were completed on time and in fact the last time all bills were passed and signed into law by the beginning of the fiscal year was 1995. This year Congress has made considerable headway in completing the process. The House has passed eleven bills and the senate has passed four. Less than a month before the beginning of 2004 fiscal year, however, none of the bills have been signed into law.

When it returned from recess, the Senate took up the appropriations bill for the Departments of Labor, Health and Human Services, Education, and Related Agencies. This House passed its version just before the summer recess. This is the bill that funds, among other things, the National Institutes of Health (NIH). In 2003, Congress completed the process of doubling the NIH budget, bringing it to $26.9 billion. This year however, the President only included a 2.5% ($682 million) increase in his budget request. The House Labor/HHS included the President's request. The Senate Appropriations Committee raised that amount slightly to 3.7% ($1 billion).

Senators Arlen Specter (R-PA), Tom Harkin (D-IA), and Dianne Feinstein (D-CA) have indicated their intention to offer an amendment on the Senate floor to add an additional $1.5 billion for a total increase of 9.2%. Columbia University has joined with over 500 health organizations to urge the Senate to adopt this amendment.

During consideration of the House version, Congressman Pat Toomey (R-PA) offered amendment to cut funding for five specific NIH grants that he felt were not worthy of government funding. The amendment lost by only one vote. The research community objected strenuously to this Congressional interference with the peer review process. Columbia University was one of the first institutions to join in urging Senators Specter and Harkin to oppose any such amendment in the Senate.

The thorniest issue that Congress must deal with is passage of a prescription drug benefit bill. Earlier this summer, the House and the Senate both passed prescription drug bills but there are significant differences between the two versions. A Conference committee and staff have been meeting over the August recess in an effort to resolve these differences but the two Houses are still quite far apart.

Also on the schedule for the fall are the conference reports for the Child Tax Credit and the Energy bill. Congress will continue work on reauthorization of TEA 21, a major transportation bill and will hold oversight hearings to look into the blackout that affected the entire Northeast in August.



Budget Outlook for Health Programs Bleak

Just after returning form its Fourth of July recess, the House passed the Labor, Health and Human Services, Education, and Related Agencies appropriations bill for FY 2004 (H.R. 2660) by a vote of 215-208. The Senate should take up its bill sometime in July.

In a marked departure from the pattern of the last several years, both the House and Senate Appropriations Committees approved their FY 04 Labor/HHS appropriations bills before end of June. Republicans were have been pushing for early passage of the Labor/HHS bill, the largest of the domestic spending bills, to show they can move the appropriations bills under the tight spending limit imposed by the budget resolution approved in April.

While not unexpected given the tight spending caps imposed on the House and Senate versions, the results for academic medicine are disappointing. The most serious news relates to the Title VII health professions education programs. The House bill cuts these programs by about 10%. As it has done in the past, the Senate Committee consolidates funding for Titles VII and VIII (nursing) and for children's hospitals graduate medical education into one account, which it funds at $423.8 million -- $287.5 million (40%) below the FY 2003 level. However, if funding for Title VIII ($112.7 million) and children's hospitals GME ($290.1 million) is retained at FY 2003 levels, only $20.9 million would be available for Title VII programs, a 93%.

As expected, Senate Labor/HHS Subcommittee Chair Arlen Specter (R-PA) made good on his pledge to increase NIH funding by a $1 billion (3.7 percent) to $27.982 billion - $318 million more than the House bill. The NIH total includes $119.2 million for extramural research facilities construction, the same level as in FY 2003. The House bill contains no funds for extramural construction. The House committee report accompanying the bill notes "more than $68 million was provided in fiscal year 2003 through the Health Resources and Services Administration for biomedical research facilities construction and renovation." Both the House and Senate bill retain the extramural salary cap for NIH researchers at Executive Level I.



Congress Adopts Budget Resolution for the Next Fiscal Year Tax Cuts and Health Care Are Big Issues

In April, Congress made some progress on next year's budget when it passed the conference report for the FY 2004 (which begins October 1st, 2003) budget. The resolution included an unprecedented budget reconciliation procedure where the House and Senate will consider different tax bills and work out the differences later.

Of great relief to the academic medical center community, the conference report dropped the House proposal for $265 billion in cuts to mandatory programs such as Medicaid, agriculture, and veterans health care. Instead, the bill directs various House and Senate committees to submit no later than Sept. 2, 2003, unspecified savings in mandatory spending related to "waste, fraud and abuse" that could be used for "development of future concurrent resolutions on the budget." The bill also created reserve funds to set aside $400 billion over the next 10 years to modernize Medicare and provide a prescription drug benefit; $12.9 billion over 10 years to reform the Medicaid program; $50 billion over 10 years to increase access to health insurance for the uninsured; $1.3 billion over 10 years to extend expiring SCHIP funds for 1998, 1999, and 2000; and $5.6 billion over 10 years for Project BioShield.

The budget agreement limited FY 2004 discretionary spending to $784.5 billion, an increase of $18.7 billion (2.4%) over FY 2003. For discretionary health programs, the conference agreement calls for $49.62 billion, equal to what the Administration proposed and an increase of $152 million (0.3%) over FY 2003.

Most of the attention was focused on the issues of tax cuts. The President had proposed a package of tax cuts totaling $726 billion over 11 years, a number that the House adopted when it passed its budget resolution. But the budget plan the Senate included only $350 billion in tax cuts because four Republicans - Senators Lincoln Chaffee (RI), John McCain (AZ), Olympia Snowe (ME), and George Voinovich (OH) would not support additional cuts. In the end Senators Voinovich and Snowe did vote for the conference agreement because the instructions to the Senate did not include the higher tax cut figure (Vice President Dick Cheney cast the tie-breaking vote).

The President and House Republicans have stated that they would push for at least $550 billion in tax cuts, but just after the resolution was passed, it was revealed that Senate Finance Committee Chairman Charles Grassley (R-IA) had promised Senators Snowe and Voinovich that he would not support any tax cut larger that $350 billion. House Republicans reacted angrily after hearing this, with most insisting that they would pass a bill with the greater amount of tax cuts regardless of what the Senate did. House Speaker Dennis Hastert (R-IL) went so far as to call Senator Grassley "irrelevant" and President Bush went to Ohio to push for his plan, lobbying for it in Senator Voinovich's home state. Although Senate Majority Leader Bill Frist (R-TN) has stated that the Senate should have communicated better with the House, neither Senators Voinovich nor Snowe have shown any signs of being willing to accept more than $350 billion in tax cuts and Senator Grassley has stated that he will keep his promise to them.



House and Senate Continue Work Budget for FY2004

The Senate passed its FY 2004 budget resolution (S. Con. Res. 23) by a 56 to 44 vote after 8 days of debate and 50 roll call votes. Six Democrats voted for final passage, and one Republican, Senator John McCain (R-AZ.) voted against it. The Senate resolution must now be reconciled with the version (H. Con. Res. 95) the House passed by a vote of 215 to 212.

Much of the attention of the House and Senate negotiators will focus on the difference between the two resolutions in the size of the proposed tax cut. The House budget plan includes the President's proposal for $726 billion in tax cuts, while the Senate voted to limit the tax package to $350 billion. Other issues to be resolved include the levels of Medicaid and discretionary spending for FY 2004. The Senate added $7 billion in discretionary spending, raising its total to $791 billion. The House resolution includes $775 billion in discretionary spending for FY 2004, and the President's budget proposed $786.6 billion, according to the Congressional Budget Office.

By a 96 to 1 vote, the Senate approved an amendment offered by Senate Labor-HHS-Education Appropriations Subcommittee Chair Arlen Specter (R-PA) to add $2.8 billion for discretionary health programs. According to a summary from Senator Specter's office, $1.8 billion of the additional funds would be assumed for the National Institutes of Health, $600 million for the Centers for Disease Control, and $400 million for health professions education programs. The Senate action raises the total included for discretionary health programs to $52.4 billion in FY 2004, an increase of $2.95 billion (6%) over FY 2003, and $4.3 billion more than assumed in the House budget resolution.

The matter now proceeds to a conference committee but one factor that may delay the budget conference is consideration of the $74.7 billion FY 2003 supplemental spending request for the war in Iraq that the President submitted to Congress. House and Senate leaders have indicated they will push for completion of the supplemental before the start of the two-week April recess.



President Bush introduces his Budget for FY 2004, Tightens Belt on Discretionary Spending
(Excerpted From the Association of American Medical Colleges Washington Highlights)

President Bush released the details of his $2.23 trillion budget proposal for FY 2004 on Feb. 3. The budget calls for total discretionary spending - spending determined through the annual appropriations process - to be increased in FY 2004 by 4% to $782 billion. Defense spending would be increased by 4.2 % to $380 billion; homeland security would be increased by 5.5 % to $28 billion; and non-defense, non-homeland security spending would be increased by 3.8 % to $374 billion. For the Department of Health and Human Services, the President's budget includes $66.2 billion in discretionary budget authority, a 2.5 % increase.

National Institutes of Health -The President's budget proposes $27.893 billion for the NIH, an increase of 2%. However, the budget proposes to convert about $1.4 billion in one-time, nonrecurring costs in FY 2003 for facilities construction and anthrax procurement to research in FY 2004, resulting in a 7.5 % increase for overall research programs and support. The budget proposal increases the number of new and competing renewal research project grants (RPGs) by 344 to a total of 10,509. This would result in an estimated success rate of 29%. The average cost for RPGs would be increased by 2.7%.

The budget once again proposes to reduce the extramural salary cap to Executive Level II. The budget eliminates funding for extramural construction through the National Center for Research Resources (NCRR). The budget proposes to increase the number of National Research Service Awards (NRSAs) by 80 to 17,197 with 74 of the new awards slated for biodefense. The budget proposes increasing pre-doctoral stipends by 4% (bringing the stipends to $19,632) and post-doctoral stipends on a sliding scale from 4% to 1% based on experience (bringing those stipends to a range from $33,624 to $49,584).

Health professions - The President's budget again slates most of the Title VII health professions programs for elimination. Just as in the FY 2003 proposed budget, the Administration provides $11 million for Title VII, which includes $10 million for Scholarships for Disadvantaged Students and $1 million for the workforce information and analysis programs. Funding for all other Title VII programs is eliminated. The budget proposes $98 million for the Title VIII nursing programs, with $72 million for basic nurse education and $26 million for advanced nursing education. From the Title VIII total, $7 million is designated for the newly authorized nurse scholarship program.

The Agency for Health Research and Quality (AHRQ) receives $278 million in the President's FY 2004 budget, an 11.6% increase over the FY 2003 request, but less than the $299 million in the FY 2003 bill introduced in the House and $308 million in the Senate-passed omnibus appropriations bill. The budget directs $84 million of the total for patient safety research, which includes $50 million for hospital-based information technology investments, with an emphasis on small community and rural hospitals; $10 million for information technology improvements in health care; and $24 million for other collaborative patient safety efforts. The budget also recommends $55 million for the Medical Expenditure Panel Survey (MEPS), a $2 million increase over the FY 2003 request. The President would fund the entire $279 million from evaluation funds.

The budget proposal provides $199 million for the Children's Hospitals Graduate Medical Education program, $1 million less than the amount recommended in FY 2003. The Senate-passed omnibus FY 2003 bill provides $285 million, level with the FY 2002 appropriation, while the House FY 2003 bill includes an increase to $292 million. The President's 2004 budget again recommends eliminating the Community Access Program (CAP), which received $120 million in FY 2002.

Bioterrorism Preparedness - As in FY 2003, the president's budget includes $518 million for the hospital bioterrorism preparedness program, administered by the Health Resources and Services Administration (HRSA). Also in the HRSA budget is $60 million for bioterrorism curriculum development. Another $1.1 billion is allocated for bioterrorism preparedness through the CDC, with $940 million designated for the states to implement their plans, $158 million to improve the Centers for Disease Control internal preparedness, and $18 million for anthrax research. The NIH budget includes $1.6 billion for biodefense research, an increase of $121 million over last year's request. Included in the new Department of Homeland Security FY 2004 budget is $400 million to strengthen and maintain the pharmaceutical stockpile. Nine hundred million dollars is provided to pre-purchase critically needed vaccines or medication. This funding is part of the 10-year, $6 billion Project BioShield, which is a new authority designed to speed up the acquisition of biodefense countermeasures.

National Health Service Corps - The President's budget proposes $213 million for FY 2004, an increase 12.7% over the FY 2003 request. The NHSC, along with the Community Health Centers program, is one of the centerpieces of the President's plan to provide health care services in underserved areas.



Congress Completes FY 2003 Spending Bill

(Excerpted From the Association of American Medical Colleges Washington Highlights)

Almost five months into the fiscal year and two weeks after the President put forth his budget proposal for FY 2004, Congress passed the FY 2003 Omnibus Appropriations Act completing work on the spending bills for this year. Federal discretionary spending is allocated in a series of thirteen annual appropriations bills that are supposed to be completed by the beginning of the fiscal year, October 1st. This year, Congress was only able to complete two of the bills, Defense, and Military Construction, and the rest of the government had been operating by virtue of a series of continuing resolutions. The process this year was complicated by the Republican victory in the November elections. Republican Senators were in no hurry to complete work on the appropriations bills in the fall, knowing that come the first of the year, they would be in Control.

The Omnibus bill, combined with the two bills Congress had passed earlier, brings discretionary spending to $763 billion, $366 billion for defense programs and $307 billion for non-defense programs. This does not include federal spending for mandatory programs like Social Security and Medicare.

The bill does complete the five-year doubling process of the National Institutes of Health budget. The agency will see its budget increased by 16.2% to $27.3 billion. Most of the increase will go towards biomedical research related to homeland defense. Of interest to research institutions, the bill maintains the Executive Level I salary cap for Extramural researchers. The Bush Administration had proposed reducing the cap to Executive Level II, approximately $16,000 less. This would have cost Columbia up to $2.2 million. Also of note, the bill does preserve level funding for the Title VII Health Professions programs. The Administration had proposed zeroing out all but $11 million of their funding. Run by the Health Resources Services Administration, Title VII provides federal support for training, dentists, primary care physicians, and public health professionals.

For more information on the FY 2003 Omnibus Appropriations Bill, go to http://thomas.loc.gov/home/approp/app03.html

Appropriations Current Issues

Last updated 5/24/ 2010

 
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