Budget/Appropriations Archives
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
