ONC Budget Cut by 29 Percent in FY2019 Draft Bill, NIH Gets $1.25B Boost

June 19, 2018
The House Appropriations Committee released a draft 2019 budget for the U.S. Department of Health and Human Services (HHS) and departments of Labor and Education that proposed slashing funding for the Office of the National Coordinator for Health IT (ONC) by $17.7 million.

The House Appropriations Committee released a draft 2019 budget for the U.S. Department of Health and Human Services (HHS) and departments of Labor and Education that proposed slashing funding for the Office of the National Coordinator for Health IT (ONC) by $17.7 million.

Under the proposed budget in the spending bill, released last week, ONC would receive $42.7 million in total funding in fiscal year 2019, or a 29 percent reduction from the agency’s current funding of $60.4 million. The $17.7 million budget cut for ONC is smaller than the 37-percent-reduction previously proposed by the White House, which sought to slash $22 million from ONC’s funding.

A federal spending bill passed back in March maintained ONC’s funding at $60 million through this September, a figure held steady for years under the Obama Administration.

As previously reported by Healthcare Informatics’ last summer, when the House Appropriations Committee released a draft funding bill for 2018 that included a $22 million budget cut for ONC, many industry stakeholders and health IT association groups expressed concerns that cuts to ONC could have an undesirable impact on the industry. The 21st Century Cures Act, passed last December, calls on ONC to perform a number of responsibilities related wide-ranging responsibilities to improve interoperability. But pundits attest that carrying out these functions could become very difficult with a slashed budget.

In a statement, Jeff Smith, vice president of public policy at the American Medical Informatics Association (AMIA), said the organization is “disappointed” in the proposed cuts to ONC’s FY 2019 budget. Smith also notes that the proposed cuts to ONC’s budget appears to be a “continuation of stagnating support for the Office.”

“Whether you look at the burgeoning influence of consumer technology in the medical space, the continued digitization of research, or the numerous aspects of Cures yet to be implemented, ONC has the kind of workload that demands more resources, not less,” Smith stated. “Congress has played an important role in protecting ONC and other parts of HHS from the draconian budget proposals of the White House. Insofar as Cures implementation and interoperability remain important to Congress, so too should fully funding ONC.”

Overall, the House Appropriations Committee’s draft funding bill proposes a total of $89.2 billion for HHS, an increase of $1 billion above last year’s enacted level and $2.4 billion above President Trump’s budget request. The funding bill provides a $1.25 billion boost to the National Institutes of Health (NIH) for a total of $38.3 billion; that’s $4.1 billion above the Trump Administration’s budget request. The House Appropriations Committee increased funding for critical research initiatives, including a $400 million increase for Alzheimer’s disease research, a $100 million increased for the Cancer Moonshot initiative and a $29 million increase for the Brain Research through Application of Innovative Neurotechnologies (BRAIN) initiative.

Additionally, the $1.25 billion increase to NIH includes a $437 million in funding, or an increase of $147 million, for the All of Us research initiative, which aims to create a 1-million-person research cohort; $30 million more in funding to develop a universal influenza vaccine; $15 million more for research on combating antibiotic-resistant bacteria; and $12.6 million for the Gabriella Miller “Kids First” pediatric cancer research initiative.

The legislation expands support for research related to opioids and pain management, as well as for the Down syndrome research initiative established in fiscal year 2018.

The spending bill also proposed cutting the budget for the Centers for Disease Control and Prevention (CDC) by $663 million, to $7.6 billion. According to a summary of the bill, after accounting for the transfer of the Strategic National Stockpile to ASPR and the one-time facilities funding in fiscal year 2018, the legislation provides an increase of $427 million for CDC on a comparable program level. This includes $848 million in transfers from the Prevention and Public Health Fund. The bill also continues the longstanding prohibition against using federal funds to advocate or promote gun control.

The spending also funds the Substance Abuse and Mental Health Administration (SAMHSA) at $5.6 billion , which is $448 million above the fiscal year 2018 enacted level and $2.1 billion above the President’s request. SAMHSA funding includes $3.85 billion to address substance use, including opioid and heroin abuse. This amount includes $1 billion for State opioid response grants, along with funding for programs authorized in the 21st Century Cures Act and the Comprehensive Addiction and Recovery Act.

The Agency for Healthcare Research and Quality’s budget would remain the same at $334 million. The budget request proposes to merge most of AHRQ’s activities into NIH.

The spending bill recommends providing the Centers for Medicare and Medicaid Services (CMS) $3.5 billion for CMS administrative expenses, which is $168 million below the fiscal year 2018 enacted level and $42 million below the fiscal year 2019 request. This funding level is sufficient to maintain core operations and services, the House Appropriations Committee said.