1. Who Gets How Much? Assessing Strategies for Formula-Based Allocation of Public Health Funds Public Health Systems Research April 21, 2006 James Buehler, MD Department of Epidemiology and Center for Public Health Preparedness & Research Rollins School of Public Health, Emory University and Epidemiology Branch, Division of Public Health, Georgia Department of Human Resources David Holtgrave, PhD Department of Health, Behavior, and Society, Bloomberg School of Public Health, Johns Hopkins University

2. CDC Cooperative Agreement on Public Health Preparedness and Response for Bioterrorism. Budget Year Five, Issued June 2004 http://www.bt.cdc.gov/planning/continuationguidance/index.asp http://www.bt.cdc.gov/planning/continuationguidance/index.asp “Each state awardee will receive a base amount of $3,915,000, plus an amount equal to its proportional share of the national population as reflected in the U.S. Census estimates for July 1, 2002.”

3. This apportionment does not take into account differences among states in… Likelihood of terrorist attack Vulnerability of critical infrastructure Transport hubs Cost of doing business Geography: size, international borders, coastline Vulnerable populations Local resources Likelihood of natural disaster Existing capacity Etc. …

4. Let’s make a new formula that takes these factors into account All we need is: A relevant data source for each of these measures Agreement on how each should be weighted Likelihood of terrorist attack Vulnerability of critical infrastructure Transport hubs Cost of doing business Geography: size, international borders, coastline Vulnerable populations Local resources Likelihood of natural disaster Existing capacity Etc. … Maybe CDC formula is OK –Simple & transparent –Quick & easy –Sensible that states with more people need more resources

5. Image source: www.1az.cz

6. National Academy of Sciences Panel on Formula Allocations Convened in 2000 In FY-1999-2000, the federal government allocated >$250 billion per year using formulas –Medicaid, highway construction, education, WIC, social services Formula elements: –Data source(s) –Threshold for eligibility –Guaranteed minimum funding –The formula: Simple to complex Some account for differences in costs or local resources –"Hold-harmless" provisions –Funding ceilings Panel on Formula Allocations. Choosing the Right Formula: Initial Report. National Academies Press, 2001. Panel on Formula Allocations. Statistical Issues in Allocating Funds by Formula. National Academies Press, 2003.

7. NAS Panel on Formula Allocations Possible adverse or unintended consequences of formula-based funding Substantial variations in "per capita" funding may undermine perceived fairness, due to: –"Hold-harmless" agreements –Guaranteed minimum funding –Random variability of source data –Mismatch between data source and program target population or goals –Differences among funded areas not taken into account by formulas Unintended effects on data sources

9. The Ryan White HIV CARE Program (HRSA) Safety net care program for people with HIV The data source imperfect: AIDS –AIDS = the late stage of HIV disease –Congressional mandate to include HIV data –Includes many ineligible for “safety net” program Early effort to account for cost differences abandoned. Cumulative AIDS reports, changed to people living with AIDS. –“Hold-harmless" provision  variations in "per case" funding Data collected by grantees –Variable surveillance capacity –Especially for HIV reporting Showdown looming over name-based versus unique identifier reporting Committee on the Ryan White CARE Act: Data for Resource Allocation, Planning and Evaluation. Measuring What Matters: Allocation, Planning, and Quality Assessment for the Ryan White CARE Act. National Academies Press, Washington DC, 2004.

10. Formula Funding Can Affect Source Data AIDS Reporting and Ryan White HIV CARE program Shift from Cumulative AIDS Reports to People Living with AIDS: Potential disincentive to assure deaths ascertained and AIDS reports updated Averted by applying national estimate of AIDS death rates to all state AIDS reports Graph source: CDC 1993 Revision of AIDS Definition 

11. Decisions should be based on data Number of cases in 2005  Each state gets 50% of funds. Average annual number of cases for 2000-2005  38% for State A and 62% for State B. Would formula differ for program aimed at: –Prevention of Disease A? –Treatment of Disease A?

12. CDC Public Health Emergency Preparedness, July 2005 (http://www.bt.cdc.gov/planning/guidance05/)http://www.bt.cdc.gov/planning/guidance05/ Objective: "to upgrade… preparedness for…terrorism and other public health emergencies” Funds Available: $862 million, FY-2005 $809,956,000: "Each State…will receive a base amount of $3.91 million, plus an amount equal to its proportional share of the national population as reflected in the U.S. Census estimates for July 1, 2003." $40,181,000: City Readiness Initiative, 30 urban areas $ 5,440,000: Early Warning Infectious Disease Surveillance, Border states $ 7,200,000: Chemical laboratory funding, 5 states

13. CDC Pandemic Influenza State & Local Government Planning & Response Activities http://www.pandemicflu.gov http://www.pandemicflu.gov Objective: "to accelerate and intensify…planning … for pandemic influenza." Funds Available: $350 million: $ 100 million, January 2006 (Phase I): –Formula Description: "Each state will receive a minimum of $500,000, and the rest of the funds will be allocated by population." “The remaining $250 million…will be awarded later…in accord with…progress and performance.”

14. Formulas Are Not as Transparent as They Appear Example: Pandemic Influenza funding The allocation cannot be recreated using published information: –Which year's Census data were used? –How were funding levels determined for Puerto Rico, separately funded local areas, and Territories? –Order of calculations?

15. HRSA Maternal and Child Health Services Block Grant ftp://ftp.hrsa.gov/mchb/titlevtoday/UnderstandingTitleV.pdf ftp://ftp.hrsa.gov/mchb/titlevtoday/UnderstandingTitleV.pdf Objectives: “…improving the health of all mothers and children,” “gap filling” clinical services, “population-based functions,” and programs for “children with special healthcare needs.” Funds Available: >80% of funds are awarded to states ($594 million in FY-2004). Formula based on: 1.“the amount awarded to the states in 1981 for the pre-block programs later consolidated into the State grant” (~3/4 of funds) 2.“the remaining amount is distributed based on the proportion of low income children that a State bears to the total number of such children for all the States.” Remaining funds ($135 million in FY-2004) “are awarded on a competitive basis to a variety of applicant organizations” for special projects.

16. CDC Preventive Health and Health Services Block Grant http://www.cdc.gov/programs/chron06.htm http://www.federalgrantswire.com/preventive_health_and_health_services_block_grant.html http://www.cdc.gov/programs/chron06.htmhttp://www.federalgrantswire.com/preventive_health_and_health_services_block_grant.html Objectives: “ a…flexible public health resource” Funds Available: $129 million FY-2004. –$121 Million: “an allocation percentage is determined for each State based on the amounts of fiscal year 1981 funds provided to the State for certain categorical health grants that were combined to comprise the...block grant to the total amount of fiscal year 1981 funds appropriated for these grant programs.” –$8 million: “ For…Rape Prevention portion of the block grant…allocated to States based on the percentage of each State's population to the national population.”

17. Per Capita Funding by Area Population, 3 CDC Grant Programs

18. Conclusions (1) Formulas aim for effective allocation of resources to realize program objectives –Transparency –Feasibility –Efficacy and Effectiveness –“Fairness”: Equivalency? Equity?

19. Conclusions (2) Federal public health programs formulas generally: –Provide a minimum funding level to all grantees –Rationale not provided for Guaranteed minimums Designations for selected cities, PR, territories –Do not account for program costs –Set asides for designated or competitive awards Baseline minimum funding shapes "per capita" allocation

20. Recommendations for Research –Build on findings from the NAS Panel on Formula Allocations and reviews of the Ryan White HIV CARE program –Assess the feasibility of accounting for local costs and resources. –Refine strategies for determining baseline minimums –Focus on the unique questions surrounding allocations for prevention programs –Consider how formulas Reflect values Are subject to manipulation

21. Images: CDC Protecting Health for Live, The State of CDC FY 2004 http://www.cdc.gov/od/oc/media/pressrel/socdc04.pdf