FY 2018 HHS Budget Observations

Last week, the Office of Management and Budget (OMB) submitted an updated and complete FY 2018 budget request with detailed spending plans for each Executive Branch department and agency, including the Department of Health and Human Services.

The budget request furnishes HHS with $66.8B in discretionary budget authority which is a 16% drop over FY 2017 enacted levels. 

If enacted, the FY 2018 HHS discretionary budget would:

• Fund HHS’ highest priorities such as health services through community health centers, early care and education, medical products review and innovation. Eliminate programs that are duplicative or have limited impact on public health.
• Consolidate the Agency for Healthcare Research and Quality's (AHRQ) activities into the National Institutes of Health (NIH).
• Include $1.1B for implementing the 21st Century Cures Act.
• Strengthen program integrity through $751M for the Health Care Fraud and Abuse Control (HCFAC) program, a $70M increase over FY 2017.
• Support substance abuse treatment, including $500M for State Targeted Response to the Opioid Crisis Grants within SAMHSA.
• Propose restructuring the Office of the National Coordinator for Health Information Technology (ONC) by reducing its budget by 36% and focusing resources on the highest health IT priorities.
• Increase FDA medical product user fees to $2.4B, a $1.2B increase over FY 2017.
• Reorganize NIH and reduces funding to $25.9B, a $5.8B decrease. 
• Eliminate $403M in health professionals and nurses training programs, and $4.1B for the Low Income Home Energy Assistance Program and the Community Services Block Grant.

Highlights of the HHS IT budget include:

• Grants account for $8.2B of the total HHS IT budget. The HHS IT budget request without grants totals $5.7B, which is a 2.9% decrease over FY 2017.
• $5.1B, or 90%, of the IT budget would be considered contractor addressable (total IT budget less the cost of government FTEs).
• Notable agency changes include a 30% decrease at the Administration for Children and Families, a 3% decrease at the Health Resources and Services Administration, a 16% decrease at Centers for Disease Control, and a 7% increase at the Indian Health Service. Although the total discretionary budget of the National Institutes of Health is slated for major cuts, the IT budget only shows a proposed 1% decrease.