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Washington Highlights

HHS Secretary Discusses FY 2018 Budget Blueprint before House Subcommittee

March 31, 2017—Secretary of Health and Human Service (HHS) Tom Price, MD, March 29 testified before the House Appropriations Labor-HHS Subcommittee for a hearing on the administration’s HHS fiscal year (FY) 2018 budget blueprint. 

The blueprint, released March 16, requests $69.0 billion for HHS, which it characterizes as $15.1 billion (17.9 percent) less than current funding levels under the continuing resolution scheduled to expire April 28, including a $5.8 billion cut to the National Institutes of Health (NIH) [see Washington Highlights, March 17].

House Subcommittee Chair Tom Cole (R-Okla.) began the hearing by describing his dismay with the proposal, including proposed increases to defense spending at the expense of NIH and the Centers for Disease Control (CDC). “[NIH and CDC] in particular are every bit as important for the national defense and national security of the American people as the Pentagon is because, frankly, you're much more likely to die in a pandemic than you are a terrorist attack,” he noted.

Subcommittee Ranking Member Rosa DeLauro (D-Conn.) concurred, stating, “I think [the proposal] is a disaster that will have literal life-and-death consequences for American families. Fifteen billion dollars in cuts to HHS is untenable.” Additionally, Rep. DeLauro commented on the proposed reduction in funding for NIH saying, “Make no mistake, this cut will turn back the clock on life saving biomedical research that you know, and I know, and the chairman knows, and everyone on this committee knows, has the power to save lives.”

In a brief opening statement, Secretary Price framed the cuts in the budget blueprint as “prioritizing critical programs and proposing the elimination of programs that are duplicative or ineffective.” He went on to identify three priorities for the department: mental health and substance abuse, emergency preparedness, and the fight to end childhood obesity.

In his questioning, Chairman Cole expressed his concern with the impact of a cut to NIH, then asked the secretary to explain. Secretary Price responded that “about 30 percent of the grant money that goes out is used for indirect expenses which, as you know, means that that money goes for something other than the research that's being done,” seemingly referring to reimbursement institutions receive for facilities and administrative expenses they incur in support of research, such as utilities and personnel.

Rep. Andy Harris (R-Md.) also raised the issue, comparing federal funding to private foundational support.

Several members of the subcommittee raised the positive economic impact of NIH. Rep. Mike Simpson (R-Idaho) pointed out, “It's not only the work that they do, but with their biomedical research advances, they positively contribute to the economy. Last year's $2 billion increase [resulted in] an increase of 27,122 jobs and more than $4 billion in economic activity.”

Rep. Katherine Clark (D-Mass.) also pointed out that NIH “returns $60 billion in our economy, never mind the good that it can do as far as a win for patients, a win for science, and a win for our bottom line.”

Rep. Lucille Roybal Allard (D-CA) asked Secretary Price to clarify how HHS plans to operationalize the language in the budget blueprint that proposes to consolidate the Agency for Healthcare Research and Quality (AHRQ) into NIH. Secretary Price explained, “We envision the opportunity for the NIH to assume the duties, the important duties of AHRQ, and then to decrease or reduce or eliminate the duplication and redundancies.” Further, he stated, “Some of the kinds of things being done at NIH are also being done at AHRQ so we look forward to the opportunity to fold AHRQ into NIH and gain those efficiencies, but also make certain we're continuing to fulfill the mission.”

In response to a follow-up question from Rep. Roybal-Allard, Secretary Price indicated that the administration had not yet determined whether the reorganization would establish AHRQ as an institute or center within NIH.

Rep. Roybal Allard also expressed her concern with eliminating Title VII and Title VIII health professions and nursing training programs at the Health Resources and Service Administration (HRSA). She emphasized, “In today's increasingly diverse population, HRSA Title VII health profession training programs have been invaluable as a tool in creating a pipeline of minority primary care professionals, who overwhelmingly returned to practice in diverse and underserved areas.”

Secretary Price agreed that workforce issues are important but said they must be addressed differently. He indicated, “One of the things that we believe is important is to focus on those areas where there is a service component to the payment back of the loan or the monies being provided for education. And that's where we've tried to put the focus and the resources.”

Though the budget blueprint focuses exclusively on discretionary spending programs, throughout the hearing, Democrats, including Reps. DeLauro, Barbara Lee (D-Calif.), and Nita Lowey (D-N.Y.), also inquired about the role that Secretary Price would play with the Affordable Care Act, and attempts to repeal the law [see Washington Highlights, March 24]. Secretary Price responded that he is “committed to fulfilling the oath that [he] took, which is to carry out the law of the land.”

Contact:

Tannaz Rasouli
Sr. Director, Public Policy & Strategic Outreach
Telephone: 202-828-0525
Email: trasouli@aamc.org

Joseph Bañez
Legislative Analyst
Telephone: 202-739-2995
Email: jbanez@aamc.org

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org