FEBRUARY 10, 2006 -- The White House hopes to eliminate six Health and Human Services programs to save $866 million in fiscal 2007—with the biggest savings coming from the community services block grant, according to the president's "hit list."
The Office of Management and Budget (OMB) estimates it could save another $1 billion by slashing funding for another half-dozen HHS programs—provided Congress agrees.
The administration tried to whittle or close most of the same programs last year, but Congress wouldn't go along. It's unclear whether the White House will have much more success this year.
According to the list released yesterday, the biggest savings, $630 million, would come from ending the community services block grant, which funds "Community Action Agencies" that provide employment, housing, nutrition, and health care services for the poor.
The administration claims the programs haven't delivered. What's more, they aren't subject to performance measures and aren't required to meet minimum standards to get funded, OMB said.
OMB also said the services the agencies provide are too scattershot to be effective and that larger federal programs may better meet the needs involved by focusing money on a specific service.
Also proposed for elimination:
- The CDC Preventive Health and Health Services Block Grant: The Centers for Disease Control and Prevention has budget authority to spend $99 million under the grant this year, but OMB said "other grants cover many of the same areas." Authorized in 1981, the grant funds chronic disease prevention, immunizations, injury reduction programs, and programs to prevent sex offenses.
- Community Services Programs: Funding this year totals $40 million for grants to offer low-income Americans employment, training, and business development opportunities. Money also goes for migrant and seasonal farmworkers and for rural housing. The administration wants to consolidate the programs into another administration initiative.
- Maternal and Child Health Small Categorical Grants: OMB would save $39 million by ending certain small categories of funding under this $693 million grant program. Under its proposal, funding would stop for programs addressing traumatic brain injury, screening newborns to check their hearing, and emergency medical services for children. The programs involved haven't shown improved outcomes or set long-term goals, OMB said.
- Urban Indian Health Program: Started in 1976, the program funds primary, preventive and behavioral health care targeting the 60 percent of American Indians and Alaska Natives that live in urban areas. The program has budget authority to spend $33 million in fiscal 2006. Providers that get this money get 60 percent of their operating funds from other sources, OMB said, adding that many Indians served by these providers can get care at community health centers.
- Real Choice System Change Grants: HHS now has budget authority to spend $25 million on the grants, but says they won't be needed next year because of funding to move disabled individuals into home- and community-based care under programs such as the HHS Money Follows the Person initiative.
Proposed for big cuts but not for elimination:
- Social Services Block Grant: OMB wants to save $500 million by cutting budget authority from $1.7 billion this year to $1.2 billion in fiscal 2007. The block grant funds services to help families become economically self-sufficient, and to prevent neglect or abuse within families. The program lacks performance measures to show it is delivering results, OMB said, and the White House says it overlaps with other programs including Temporary Assistance for Needy Families.
- Children's Hospital Graduate Medical Education Payment Program: Started under the Clinton administration, the program began as a $40 million subsidy to children's hospitals but has grown eightfold since then without justification for such an increase, OMB said.
"In 2006, the program provided an average subsidy of $4.9 million to 61 children's hospitals," OMB said. "However, children's hospitals are more likely to have positive profit margins than other hospitals. In 2000, 74 percent of children's hospitals had positive margins, compared to 67 percent of all hospitals, and 59 percent of major teaching hospitals."
Budget authority would be sliced from $297 million this fiscal year to $99 million in fiscal 2007, for a savings of $198 million. Payments "will be directed to those hospitals with the greatest financial need that treat the largest number of uninsured patients and train the greatest number of physicians." - HRSA Health Professions Programs: Budget authority would be cut from $295 million this year to $159 million in fiscal 2007, saving $136 million. Grants given out by the HHS Health Resources and Services Administration under the programs aim to direct health care professionals including doctors, dentists, and nurses to medically underserved communities.
While there are "regions and pockets" of the country that have shortages of health professionals, "only two of every 10 providers who benefit from the programs' long-term training support enter shortage areas," OMB said. Funds would be concentrated on training and education of nurses. - HRSA Rural Health Programs: The Health Resources and Services Administration funds rural facilities known as "Critical Access Hospitals" as well as state offices of rural health and planning to create rural provider networks. But OMB says budget authority for these programs should be shrunk to $27 million because HHS has 225 other health and social services programs serving rural areas. The reduction would save $133 million.
The remaining money would be used to continue state offices of rural health and to continue research on rural health care. - Poison Control Centers: HHS supports poison control centers while they secure certification and other sources of funding. Budget authority for these efforts would fall from $23 million in fiscal 2006 to $13 million in fiscal 2007. Many centers no longer need assistance to achieve certification, OMB said.
Try, Try Again
The administration tried but failed last year to shut down five of the six programs on the fiscal 2007 termination list.
The new program added to the termination list is the Urban Indian Health Program. Sen. Jeff Bingaman, D-N.M., asked HHS Secretary Michael O. Leavitt in a Senate Finance Committee hearing Feb. 9 why the administration wants to shutter that program. Leavitt said community health centers are available in the same area. "That just feels inefficient to me to create a separate system for one population," Leavitt said.
The administration also sought major cuts last year in the children's GME, health professions, and rural health programs, but Congress appropriated considerably larger sums than the White House wanted. The administration did not seek a major cut last year in the Social Services block grant or in poison control centers.
The health professions program is a perennial target of Bush budget cutters but is strongly defended by family physicians. They've already weighed in this year, saying Thursday the reductions would eliminate funding for family medicine training programs.
"Fewer students training to be family physicians means fewer physicians to care for our most underserved populations—the elderly, poor, disabled, and those who live in rural areas and the urban core," said Larry S. Fields, president of the American Academy of Family Physicians. "An investment in family medicine training by the Bush administration would have helped slow the rapidly increasing health cost of health care due to sub-specialization and would have helped staff the president's community health centers. By zeroing out all funding for these training programs, Americans' access to quality, affordable heath care has been compromised," Fields said.
