March 2005
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The President's Budget and Public Health The most notable proposed cuts affecting local public health are in bioterrorism preparedness and the Preventive Health and Health Services block grant. The Administration proposes to cut the former by 14% and to eliminate completely the latter. The cut in grants for improving state and local capacity in bioterrorism preparedness echoes last year's Presidential budget, which proposed a similar cut. Congress overruled that cut and level-funded the program, although grants to states were nonetheless reduced by the Administration in order to fund the Cities Readiness Initiative. Reductions for this purpose will continue. The Administration's budget narrative suggests that heavy investment in state, local and hospital bioterrorism preparedness continues and that it is time to redirect investment into other priorities such as medical surge capacity and supplies for the Strategic National Stockpile (SNS). Indeed, the budget reduces state and local health department funding by $130 million and adds $202 million to the SNS for such items as portable mass casualty treatment units, additional medicine and supplies, and an ability to ensure those can be made available anywhere in the country within 12 hours. The $131 million Preventive Health and Health Service block grant program would be history, if Congress goes along with the Administration. The budget justification argues that the program lacks national-level performance outcome information and that investment in categorical grants provides greater accountability and evidence of impact. It notes that the block grant duplicates and overlaps with other CDC categorical programs, such as cancer prevention and immunization, and that the state and local bioterrorism preparedness grants (despite the proposed cut) constitute continuing significant investments in the public health system. The bottom line is that these two programs that focus on building the state and local governmental public health system would take the biggest hits of any CDC program. Chronic disease prevention would be reduced by $59 million, by way of eliminating the Youth Media Campaign (also known as VERB). All in all, CDC's FY 2006 budget would be about 6.2% less than the current fiscal year. Other cuts include proposed elimination of Congressionally earmarked special projects, to the tune of $60 million, and most of CDC's buildings and facilities line, permitting completion of capital improvements in progress but no new projects. The President's budget addresses the influenza vaccine issue in several ways. It adds $30 million to the Section 317 program to provide guarantees to manufacturers for purchase of vaccine, $20 million to 317 for purchase of influenza vaccine for children ineligible for the Vaccines for Children (VFC) program, and $40 to VFC to purchase a stockpile of pediatric influenza vaccine. The Department of Health and Human Services would receive $120 million (an increase of $20 million) to develop year-round domestic vaccine production surge capacity, including vaccines produced through cell culture, and additional funds would go to the National Institutes of Health for vaccine research. The President's budget for the Health Resources and Services Administration (HRSA) provides a 17%, or $304 million, increase for community health centers, which would take that program past the $2 billion mark. Among the offsetting cuts would be complete elimination of health professions education programs and the Health Community Access Program, a drastic 80% reduction in rural health program funding, and all $483 million in Congressionally-earmarked special projects. The President's budget would add $10 million, or 1.2%, for the AIDS Drug Assistance Program (ADAP) and one-half of one percent to other Ryan White HIV/AIDS funding. Overall, HRSA's budget would be cut by more than 11%. Eliminating Congressional earmarks is not a new budget strategy, but it will create great tensions later in the year when Congress addresses this budget. It is unrealistic to expect such earmarks to disappear, but it is also unrealistic to expect that Congress will exceed the President's overall number for combined spending on the Departments of Labor, Health and Human Services and Education (which are combined in one bill). Education programs also are slated for substantial cutting. Finding funds to restore any of the cuts proposed by the President in both health and education presents Congress with a difficult budgetary and political problem. The President also, as predicted, proposed substantial reductions in Medicaid funding to the states. The budget includes a broad, conceptual discussion of proposed Medicaid changes focusing on increased state flexibility and the closure of "loopholes", but none of the detail that will be necessary to evaluate their effects. The Administration proposes a net reduction of $45 billion in federal Medicaid spending over a 10-year period, composed of $60 billion in spending reductions and $15 billion in proposed spending increases for Medicaid and the State Children's Health Insurance Program (SCHIP). The proverbial "elephant in the living room" with respect to the President's health and public health budget is, of course, large projected growth in Medicare expenditures, which many analysts believe dwarf Social Security issues. As it is, Medicare comprises 53% of the proposed FY 2006 Department of Health and Human Services budget. Medicaid consumes 30%, while discretionary programs (including CDC and HRSA, as well as the National Institutes of Health, the Food and Drug Administration, and the Substance Abuse and Mental Health Services Administration, the Administration on Aging, the Indian Health Service, and the Agency for Healthcare Research and Quality) together account for barely more than 10%. The next steps in this year's budget process are hearings, development of a Congressional budget resolution setting overall spending caps, then development of the individual appropriations bills. NACCHO will be monitoring public health funding closely and advocating vigorously against cuts in funding for local health departments. Watch the Legislative Action Center on our website. We'll let you know the best times to voice your views. The President's Budget for the Department of Health and Human Services can be found at http://www.dhhs.gov/budget/docbudget.htm. The entire federal budget can be found at http://www.whitehouse.gov/omb/budget/fy2006/. |