Good morning, Chairman Porter, Congressmen Obey, and members of the Subcommittee. I am
pleased to appear before you today to discuss the President's FY 2001 budget for the Department
of Health and Human Services.
A PROUD HISTORY...
Before I discuss our plans for confronting the challenges that lie ahead, I think it is important
first to take a look back at where we have been. Over the past seven years, we have worked
together to develop innovative solutions that have improved the health and well being of all
Americans. Let me note just a few of these accomplishments:
Working together, we have expanded enrollment in Head Start from approximately 714,000
children in 1993 to an estimated 950,000 in this budget, while at the same time improving the
quality of the program, thereby providing a strong foundation for success for hundreds of
thousands of low-income children.
Two years ago, the President called for an increase of almost 50 percent over five years in the
NIH budget as part of his Research for America Fund. Since that time the NIH budget has
increased by over $4.2 billion and, with the funding proposed by the President this year, we will
be ahead of schedule in reaching our goal. In addition, we have increased the number of
Research Project Grants funded by the National Institutes of Health by over 30 percent, from
23,952 in FY 1993 to 31,524 in this budget. This represents a dramatic expansion of our
scientific knowledge base that will pave the way for biomedical advances in the years ahead.
We have nearly tripled the number of people receiving access to combination drug therapy under
the Ryan White Care Act AIDS Drug Assistance Program (ADAP), from almost 49,000 in 1994
to approximately 141,000 with this budget.
We have improved the health of our seniors by increasing the number of healthy meals served to
older Americans under the Administration on Aging's Nutrition programs from 240 million in
FY 1994 to 279 million in this budget year.
With the enactment of the Health Insurance Portability and Accountability Act of 1996, we have
helped individuals keep their insurance when they change jobs, guaranteed renewability of
coverage, and helped ensure access to health insurance for small business.
Together with the states, we have undertaken the largest health care coverage initiative since
Medicare, namely the State Children's Health Insurance Program. In just the two years since its
enactment, the number of children enrolled in SCHIP -- now almost 2 million -- has doubled. In
addition, the number of states covering children up to 200 percent of poverty has increased by
more than sevenfold.
Last year, the President signed into law the bipartisan Ticket to Work and Work Incentives
Improvement Act that allows people with disabilities to maintain their Medicare and Medicaid
coverage when they go to work. It also includes a new demonstration program that allows
people with disabilities who are still working and are not sufficiently disabled to qualify for
Medicaid to obtain coverage and reforms the training system for people with disabilities.
We created the Vaccines for Children Program, to finance immunizations for children without
private health coverage. Childhood immunization coverage rates in 1998 were the highest ever
recorded. Ninety percent of toddlers in 1996, 1997 and 1998 received the most critical doses of
each of the routinely recommended vaccines, surpassing the President's 1993 goal.
We also have undertaken a number of new initiatives to target emerging threats and address
long-standing problems. We have launched new initiatives to promote research on disease
prevention and health care quality, to improve the quality of nursing home care, to provide
support for our nation's children's hospitals, and to increase the number of children adopted
from our child welfare systems. To educate Medicare beneficiaries about their health care
options, we have implemented the largest peacetime outreach campaign ever undertaken by the
federal government. We have stepped up efforts to increase the availability of substance abuse
treatment, to eliminate racial and ethnic health disparities, and to address the AIDS crisis in
minority communities. And we have invested significant resources to prepare the nation to
respond to the medical and public health consequences of chemical and bioterrorist attacks. We
have launched new initiatives to protect the rights of Americans in managed care and protect the
privacy of electronic medical records held by health plans, health care clearinghouses, and health
care providers.
While we should be proud of past accomplishments, we must continue to address ongoing health
and human services challenges. These include: expanding access to quality health care and
extending protections to the uninsured and at-risk; supporting working families and bettering the
lives of our nation's children; encouraging greater scientific advancement; and creating a
healthier America.
Thanks to our continuing economic prosperity, we have a great opportunity to meet these
challenges. In the last two years, we have recorded back-to-back surpluses for the first time
since the 1950's. The combination of a strong economy, fiscal discipline, and unprecedented
advances in our scientific knowledge give us the opportunity to make the investments needed to
build on all of our achievements over the last seven years.
Mr. Chairman, the total HHS budget request for FY 2001 is $421.4 billion (Outlays). The
amount before this subcommittee totals $267 billion (BA), of which $44.8 billion is
discretionary. This discretionary component represents an increase of $4.5 billion over last year.
Let me now highlight the main components of our FY 2001 budget request.
EXPANDED HEALTH CARE COVERAGE
We live in an age of remarkable advances in the biomedical sciences. Yet too many of our
citizens are denied the benefits of these advances because they lack access to quality, affordable
health care. Throughout his Administration, President Clinton has made expanding access to
health care one of his most important goals. Working with the Congress, we have had some
notable successes, including enactment of the State Children's Health Insurance Program, which
today covers nearly 2 million children; the Health Insurance Portability and Accountability Act,
which allows workers to keep health insurance coverage when they change jobs and limits the
ability of insurers to deny coverage based on pre-existing conditions; and most recently, the
Ticket to Work and Work Incentives Improvement Act, which allows disabled Americans to
return to work without losing their Medicare and Medicaid coverage.
But even with these successes, approximately one-seventh of the population still lacks health
insurance. Our budget seeks to address these problems through a number of initiatives designed
not only to expand access to care but to improve the quality of health care as well.
Expanding Coverage under Medicaid and SCHIP
The State Children's Health Insurance Program (SCHIP), enacted in 1997, now provides nearly
two million low-income, uninsured children with access to health insurance, preventive
medicine, and immunizations. While the success of the SCHIP program has greatly enhanced the
health of these children, many of their parents remain uninsured. And there still are many
children who are eligible for Medicaid and SCHIP who are not currently enrolled. With the
country's resources growing, the economy booming, and the SCHIP program showing great
progress, it makes sense to take advantage of this opportunity to implement new options for low-income working families without health insurance. The President's budget includes proposals to
create a new "FamilyCare" program that expands coverage to the parents of children eligible for
Medicaid and SCHIP, increase outreach efforts, and simplify the enrollment process.
Under FamilyCare, parents would be enrolled in the same programs as their children, and states
would receive the higher SCHIP matching payments for expanding coverage to parents. To
ensure that the original intent of the SCHIP program is met, states would be required to expand
eligibility for children up to 200 percent of poverty before accessing funds to cover parents. As
is the case with children, priority in enrollment would be given to lower-income parents before
covering higher-income parents.
If, after five years, some states have not expanded coverage of parents to at least 100 percent of
poverty, they would then be required to do so. By 2006, all poor parents would be eligible for
coverage just as their children are today. We believe that enrolling parents in Medicaid or
SCHIP will not only improve their health, but will also make it easier for entire families to
access insurance through one source, thereby increasing the number of children participating in
the program. This FamilyCare initiative is a practical, targeted approach to encouraging greater
insurance coverage. Over eighty percent of parents of uninsured children under 200 percent of
poverty are themselves uninsured, while nearly two-thirds of uninsured parents (6.5 million)
have children eligible for Medicaid or SCHIP. The budget proposes to extend and improve the
transitional Medicaid program, which provides important health insurance coverage for families
moving from welfare to work. Our proposals would use existing state administrative and
delivery systems and no new bureaucracies would be needed.
In addition to covering parents, states also will be given the option to extend Medicaid coverage
to young people ages 19 and 20. If they do, they will also have the option to cover kids up to age
20 under SCHIP. To further increase Medicaid and SCHIP enrollment, the President's budget
supports new efforts to simplify eligibility and aggressively expand efforts to enroll eligible
children identified through school lunch programs. To ensure that children are not overlooked in
States that have different rules and procedures for Medicaid and SCHIP, we also propose to
require that States conform certain eligibility rules between Medicaid and SCHIP. Our budget
also proposes $10 million in mandatory funding for competitive grants to States that develop
innovative plans for outreach to the homeless and the coordination of services across the
Medicaid, SCHIP, TANF, Food Stamps, and Mental Health and Substance Abuse programs. If
they do, they also will have the option to cover kids up to age 20 under SCHIP.
Finally, our budget seeks to reverse some of the inequities that have resulted from the 1996
welfare reform legislation by giving states the option to provide Medicaid or SCHIP coverage to
legal immigrant children and pregnant women. The budget also proposes to restore SSI and
Medicaid eligibility to legal immigrants who entered the United States after the enactment of
welfare reform, become disabled and live in the U.S. for five years. Parents of legal immigrant
children would also be eligible for coverage under our FamilyCare proposal. In addition, the
budget seeks to restore Food Stamps eligibility to legal immigrants who were in the country
before the enactment of welfare reform and either subsequently reach age 65 or have children
who are eligible for Food Stamps.
In addition, the budget will take an important step to improve the health of low-income
Americans by ensuring that they have access to drugs that help them quit smoking. The budget
will ensure every state Medicaid program covers both prescription and non-prescription smoking
cessation drugs, removing a special exclusion now in law, and requiring states to cover these
drugs as they cover all other FDA-approved drugs.
Modernizing and Strengthening Medicare
For the last thirty-five years, Medicare has been the cornerstone of our efforts to ensure that all
seniors have access to the quality health care they need and deserve. However, since its
enactment in 1965, much in the health care system has changed, not only the types of care
provided and the setting in which these services are performed, but also the makeup of the
population that receives Medicare. These changes have dramatically increased the financial
strains on the Medicare program, and current actuarial projections show that by approximately
2015, just as the large baby-boom generation is becoming eligible, Medicare may be faced with
insolvency.
The Clinton-Gore Administration budget also dedicates $432 billion over ten years to Medicare
to extend the solvency of the Trust Fund until at least 2025 and to create a voluntary, affordable
prescription drug benefit. It includes a new, multi-billion dollar reserve fund that can be used to
add protections against catastrophic drug costs to the President's proposed drug benefit. This
financing commitment is part of a comprehensive plant to modernize and strengthen Medicare to
ensure that it can continue to deliver high quality, affordable care in the 21st Century. These
steps include making the program more competitive; introducing private sector purchasing and
management tools; and continuing our historic fight against fraud, waste, and abuse.
Over the last thirty-five years, the development of new prescription drugs to treat a variety of
conditions has helped Americans to live longer and higher quality lives. The centerpiece of the
President's plan to modernize Medicare is a voluntary prescription drug benefit that would be
affordable and accessible to all beneficiaries. This benefit, which would rely on market
competition to obtain lower prices, would have no deductible, and would pay half of all costs up
to $2,000 in FY 2003, increasing to $5,000 by FY 2009. The plan would fully pay for costs for
beneficiaries with incomes below 135 percent of the poverty level, and provide premium
assistance for those with incomes between 135 and 150 percent of the poverty level, while
providing financial incentives to employers to continue offering prescription drug benefits to
current retirees.
The President's budget also proposes much-needed incentives to increase the utilization of
preventive services by Medicare beneficiaries. Our plan would eliminate existing coinsurance
and deductibles for covered preventive benefits, including colorectal and prostate cancer
screenings, pelvic exams, mammographies, bone mass measurement, and diabetes self-management. The President also is planning to develop a three-year demonstration for smoking
cessation services. By lowering the cost and expanding the availability of these services, we will
not only save lives, but will minimize the need for more extensive, and expensive, treatments in
the future.
While we work to strengthen Medicare to better serve current beneficiaries, our budget also
includes proposals to expand access to Medicare to groups who face barriers to health insurance
coverage. These proposals will allow Americans ages 62 to 65 to buy into Medicare by paying a
premium, provide a similar buy-in option for displaced workers ages 55 to 62 who have lost
employer-provided health coverage, and provide COBRA coverage to retirees between the ages
of 55 and 65 whose companies have reneged on their promise to provide health benefits. To
make these buy-in options more affordable, the budget includes a proposal for a tax credit,
available to displaced workers over age 55 as well as all eligible persons ages 62 to 64, that
would be equal to 25 percent of the buy-in premiums.
As important as our efforts to modernize the Medicare benefit package are, Medicare recipients
will be able to realize the full benefits of these new services only when we give equal attention
to strengthening and modernizing the management of our health programs. The President's
budget continues efforts to improve the Health Care Financing Administration's (HCFA)
management, building on the five-part reform plan advanced last year to increase flexibility
while also increasing accountability. Our budget also maintains our commitment to fighting
fraud and abuse, investing in a new Medicare contractor oversight initiative to address a number
of concerns outlined in OIG and GAO reports last year. This initiative includes funding to
improve evaluation of program operations, establish financial management controls at each
contractor, develop an integrated general ledger accounting system that will ensure clean audit
opinions into the future, and monitor and oversee these changes at all contractors.
These actions will augment our already successful efforts at combating fraud, waste, and abuse
in the Medicare and Medicaid programs. As many of you may already be aware, the Department
of Justice recently announced that, in conjunction with HHS, it had achieved a $486 million
settlement with a national health provider that had been defrauding the Medicare program. This
action is in addition to results reported in latest Health Care Fraud and Abuse Control account
report that indicated that $490 million had been collected as a result of successful prosecutions in
1999. Of that amount, $369 million was returned to the Medicare trust funds. In addition, the
Medicare Integrity Program reported an increase of 25 percent in total overpayments prevented
and identified in the first six months of FY 1999 compared to the same period the year before.
These successful efforts are why the latest Medicare Trustees' Report included this
Administration's fraud and abuse efforts as a contributing factor in slowing the rate of growth of
the Medicare program.
Increasing Access to Health Care for Uninsured Individuals
Those who lack health insurance are often forced to rely on emergency rooms or ad-hoc
networks of facilities and individual health professionals for whatever care they are able to
receive, or to forgo any health care at all. Last year, the President's budget requested
$25 million to launch a new initiative to help community health clinics, public hospitals,
academic health centers, and other institutions serving the poor to create new systems of
comprehensive and coordinated care that uninsured workers and their families could depend on,
and this Committee responded by fully funding this request. To continue this effort, this year the
President is proposing to increase funding for this initiative to $125 million. This increase will
allow as many as 40 to 60 additional communities to receive grants to improve the capacity of
safety-net providers. The President's budget also continues to provide strong support for the
nation's Community Health Centers, which provide care to nearly 10 million low-income and
uninsured individuals in rural and inner city areas. Our budget requests $1.1 billion to support
Community Health Centers, an increase of $50 million over last year.
Long-Term Care
With more Americans now living longer than ever before, one of the most pressing demands we
face is the increasing need for long-term care services. Studies show that the great majority of
individuals who need long-term care prefer to remain in their own homes and communities
rather than receive care in institutional settings, but this places a heavy burden on the family
members and friends who must provide supports for them. More than half of these caregivers are
women, and one-third have full time jobs. Our budget seeks to address the pressing need for
new long-term care solutions through a multi-faceted initiative designed to help both the millions
of Americans who require long-term care and those who care for them.
Our budget invests $125 million to support family caregiver activities in the Administration on
Aging (AoA). This initiative will provide States and local communities with the flexibility to
design and provide caregiver support activities to approximately 250,000 families nationwide
who are caring for elderly relatives with chronic diseases and disabilities. Services provided will
include quality respite care, information about local services, counseling, and training for
complex care needs.
The budget also proposes $140 million over five years to expand access to home and
community-based care services under Medicaid through an option to equalize income eligibility
standards for those who need institutional care but choose to live in the community. This long-term care initiative also includes a $3,000 tax credit to provide support for those with long term
care needs and those who care for a disabled or elderly relative; an innovative housing initiative
to integrate assisted living facilities and Medicaid home and community based care settings; and
a program to provide Federal employees and their families with the opportunity to purchase
private long-term care insurance though a group plan.
Nursing Home Quality Initiative
As we begin to develop a support system for those who choose to receive long term-care in
home and community-based settings, we must also continue to ensure that nursing home
residents are receiving the highest quality care possible. The FY 2001 budget includes $71
million for continuing quality monitoring activities in last year's budget to improve federal and
state oversight of nursing homes. Now in its third year, this initiative supports the efforts of
states to strengthen enforcement and oversight of nursing home quality and to crack down on
those who repeatedly violate program standards. Expanding on activities already underway,
funding will support increased surveys of repeat offenders, improved training for surveyors, and
enhanced legal services including resolution of the backlog of appeals.
RENEWED SUPPORT FOR CHILDREN AND FAMILIES
Mr. Chairman, these investments in health care access and quality, in improving our public
health system, and in broadening our scientific knowledge, are all fundamental to making sure
that the new century is a time of good health and prosperity for all Americans. But just as we
honor our commitments in the health arena, we also keep our commitments to improving the
lives of the nation's children and families. The President's budget keeps our promise to work
toward an America where every child, and every family, has the opportunity to succeed at work,
at school, and at home.
Improving Access, Affordability, and Quality of Child Care
For the millions of American families in which parents must work to support their children, the
availability of child care is often the difference between self-sufficiency and dependency. But
even though funding for child care has doubled under the Clinton Administration, recent studies
showed that in FY 1998 only ten percent of the children potentially eligible for federal child care
subsidies received them. As we have said before, no parent should be forced to choose between
the job they need and the child they love. We must take steps to close this gap and help all
parents find child care that is safe, reliable, and affordable.
As we close this gap, we also must continue to improve child care quality. Study after study has
shown that safe, quality child care is essential to the healthy development of our children. But
the lack of quality care has forced too many parents to place their children in less than desirable
settings, and even low quality care can place a heavy financial burden on low-income families.
The President's budget builds on our ongoing efforts to remedy these deficiencies with a
comprehensive initiative designed to not only make child care more affordable but also to
improve the quality of care.
Our FY 2001 budget requests an additional $817 million, for a total of $2 billion, for the Child
Care and Development Block Grant. This increase will provide child care subsidies to almost
150,000 additional low-income children. Also included in the $2 billion total is $223 million to
improve the quality of care, of which $50 million is for infant and toddler quality care efforts;
$19 million is for school-aged care and resource and referral activities; and $10 million is for
ongoing research, demonstration, and evaluation programs. Our budget also proposes an
increase of $3 billion in mandatory funding over five years, including $600 million in FY 2001,
to establish an Early Learning Fund. This fund will provide money to states to offer community
level challenge grants for programs that improve childhood development and school readiness
and the quality and safety of care. The President's Child Care Initiative also includes critical
increases for activities in the Departments of Treasury and Education.
Enhancing Head Start
Since its enactment thirty-five years ago, the Head Start program has been one of our greatest
success stories, ensuring that millions of low-income children start school ready to learn. In
1993, the Clinton Administration set the goal of enrolling one million children in Head Start by
FY 2002. The President's $6.3 billion request for FY 2001, an increase of $1 billion, will keep
us on track to realize this goal, increasing the number of children enrolled to nearly 950,000. A
portion of these funds will be reserved for grants to unserved and under-served populations.
Consistent with the focus of the 1998 reauthorization of Head Start to improve the quality of
services, $418 million of the proposed increase will be targeted for reducing class size,
improving facilities, staff training, and school readiness; obtaining safer and better equipment;
and attracting and retaining top-quality staff. Finally, our Head Start budget request includes
$564 million for the Early Head Start program, which will provide 54,000 infants and toddlers
and their families with continuous and comprehensive child development and family support
services.
Increasing Parental Responsibility through Child Support Enforcement
One of the key underpinnings of this Administration's support for working families is the idea of
encouraging personal responsibility. Nowhere is this more evident than in our actions to step up
child support enforcement, which is a critical support for children and families. Child support
collections have almost doubled since 1992, reaching an estimated level of $15.5 billion in FY
1999. Our package of child support enforcement proposals is self-financing and it increases
collections to families by more than $1.8 billion over five years. These proposals build on our
success in the program through changes designed to give states new options to get more money
to families and to improve enforcement tools to increase collections. These actions are part of a
comprehensive Administration initiative to promote ensure that non-custodial parents who can
afford to pay child support do so, and helping lov-income non-custodial parents go to work so
that they can support their children through "Fathers Work" grants in the Department of Labor's
budget. Under one proposal, we would match State efforts to allow families still working their
way off welfare to keep a portion of the child support they are owed, increasing payments to
these families by $388 million over five years. A second proposal provides States the option to
simplify their rules for distributing child support to a system where families that have left
welfare will keep all the child support paid by the non-custodial parent, resulting in increased
payments to families of $815 million over five years. Both of these proposals build on our
Family First distribution policies. Our package also includes proposals for better enforcement
techniques and program improvements that will save the Federal government nearly $600
million over five years while increasing payments to families by over $650 million.
Ensuring Continued Educational Excellence in the Nation's Children's Hospitals
As we move to increase the number of children with health insurance, we also must continue our
efforts to ensure that all children receive the highest quality care. Expertly trained pediatricians
are a critical ingredient in providing high quality care to children, and children's hospitals play
an essential role in their education, training over 25 percent of all pediatricians and the majority
of pediatric specialists. Last year, the President proposed, and this committee funded, a new
$40 million program to support the vital role children's hospitals play in training physicians.
This year, our budget proposes to double this amount, providing $80 million to raise support for
approximately 60 free-standing children's hospitals to a level more consistent with other
teaching hospitals.
Advancing Innovative Treatments for Asthma
Approximately 5 million of our nation's children suffer with asthma, and children from low-income families are disproportionately affected. What makes this particularly disconcerting is
that the number of children afflicted has doubled over the past 15 years, with the sharpest
increases in rates among children under age 5. Asthma is a leading cause of school absenteeism,
and children who suffer from asthma are often forced to limit their activities. To address this
growing health problem, our budget proposes $100 million over two years in demonstration
grants to states to test innovative asthma disease management techniques for children enrolled in
Medicaid and SCHIP. Through appropriate clinical disease management, these programs will
attempt to reduce asthma related incidents and keep children with asthma out of emergency
rooms and in school.
Expanding Substance Abuse Activities
Even with all our efforts over the last few years to expand the availability of services to those
addicted to drugs and alcohol, there continues to be a significant gap between the need for
substance abuse treatment and the capacity available to provide treatment. Estimates by the
Office of National Drug Control Policy show that less than half of the five million individuals
who need substance abuse treatment actually receive these services. To further close this gap,
the President's budget includes a total of $3.3 billion in HHS for substance abuse treatment and
prevention, including $2 billion to support SAMHSA's substance abuse prevention and
treatment activities. Included in this request is an additional $54 million for Targeted Capacity
Expansion grants to support rapid and strategic responses to emerging areas of need. The request
also includes an increase of $31 million for the Substance Abuse Block Grant, which will
provide funding through the states for over 10,500 community-based treatment and prevention
organizations. In all, our budget request will enable more than 16,000 additional individuals to
access treatment services.
Providing Heating and Cooling Assistance to Low-Income Families
While we are enjoying an unprecedented wave of economic prosperity, and on average the
country has experienced a relatively warm winter season, one area of continuous concern has
been the impact that heating and cooling costs have on the lives of the poor. The Low-Income
Home Energy Assistance (LIHEAP) program helps protect the health of low-income families by
providing assistance in meeting heating and cooling costs to approximately four million
households each year. Those households receiving assistance include some of our most
vulnerable populations: 35 percent include an elderly member; 28 percent include a person with
a disability; and 48 percent include a child under age eighteen. Last year, the Congress
recognized the importance of the LIHEAP program to low-income families and provided $1.1
billion in advance appropriations for FY 2001 for the program, and also provided $300 million
in contingency funding to meet unexpected needs due to unusually high or low temperatures or
natural disasters. Our budget continues to support the LIHEAP program, requesting an advanced
appropriation of $1.1 billion in FY 2002, as well as $300 million in contingent emergency funds.
GREATER SCIENTIFIC ADVANCEMENT
As we enter the new millennium, we stand on the cusp of an era of that promises unprecedented
scientific advances. However, these breakthroughs will only be realized if we continue to make
the necessary investments in biomedical research. Our budget continues along the path we set
several years ago by investing in basic biomedical research as well as in research that will lead to
improvements in the quality of care, thereby moving important scientific discoveries from the
laboratory into our hospitals and clinics.
Investing in Biomedical Research
Biomedical research has been at the center of the unprecedented gains we have made in
improving the health and quality of life for all Americans. Breakthroughs that we did not think
were possible only a few years ago are now within our reach, but it will require a sustained
investment for these endeavors to bear fruit. The President's FY 2001 budget includes almost
$19 billion, an increase of $1 billion over last year's funding level, for biomedical research at
NIH. This increase will support research in such areas as diabetes, brain disorder, cancer,
disease prevention strategies, and development of an AIDS vaccine, and eventually lead to a
revolution in our ability to detect, treat, and prevent disease. This request will enable NIH to
fund 31,524 research project grants, the highest total in history, and enhance activities in critical
areas such as research on racial and ethnic health disparities, biomedical information and
technology, clinical research, and genomics.
Using Science to Improve Quality of Care and Reduce Medical Errors
As we make new breakthroughs in biomedical research, we must also work to see that these
scientific advances result in better quality health care. Even with all our scientific innovations, a
recent study by the National Academy of Sciences' Institute of Medicine estimated that as many
as 98,000 Americans die each year due to medical errors. To address this problem, the
President's budget makes new investments in error prevention, patient safety research, and
information technology.
Our budget invests $250 million in the Agency for Healthcare Research and Quality (AHRQ) to
support research activities that will improve quality of care, reduce medical errors, and produce
better health outcomes. These resources will be used to step up research efforts on the uses and
tools of health information technology; sponsor clinical prevention research and research to
enhance patient safety and reduce medical errors; and expand research on issues of workers'
health. These activities will help us to learn how best to translate knowledge into daily practice
and improve health care for all Americans.
Our budget also invests $20 million to implement a new Health Informatics Initiative designed
to improve patient care and health outcomes through the efficient and effective use of data and
information. This request will fund a set of cross-cutting and agency-specific investments in
information systems and health data, thereby enabling HHS to assume a greater national
leadership role in the establishment of health data standards while also strengthening the
information base for decision-making, improving the uniformity and ease of transmission of
health care data, and protecting the confidentiality of health information. In addition, our budget
includes $45 million to enhance the Food and Drug Administration's post-market activities.
This includes funds to expand their adverse-event reporting system and to allow FDA to
investigate, identify and prosecute those selling prescription drugs over the Internet without
proper certification.
Food Safety
Enhancing our capabilities to conduct surveillance will also help us in our ongoing fight against
the threat of food borne diseases. Estimates show that food-related hazards are responsible for
as many as 76 million illnesses, 325,000 hospitalizations, and 5,000 deaths each year. To
combat these outbreaks, the budget seeks a $10 million increase for CDC's Food Safety
programs. These funds will support enhanced public education efforts and the continued
expansion of the PulseNet network of health labs. This award-winning network preforms DNA
"fingerprinting" of disease causing bacteria, enabling public health agencies to identify and
respond more rapidly to disease outbreaks. In addition, the Food and Drug Administration
(FDA) is seeking an increase of $30 million for its food safety activities. These funds will be
used to increase inspections so that all high risk food establishments are covered, expand the
number of examinations of imported foods, increase laboratory capacity, broaden efforts to work
with states and the industry to make standards more consistent, and in conjunction with the
Department of Agriculture and the states, begin to implement the Egg Safety Action Plan
prepared by the President's Council on Food Safety.
CREATING A HEALTHIER AMERICA
Expanding access and improving the quality of health care are crucial steps toward ensuring that
all Americans live long, healthy lives. But new threats to public health continue to emerge, and
many long standing health problems still pose considerable risks. From AIDS prevention and
treatment to food safety and the control of infectious disease, our FY 2001 budget continues our
work to vigorously safeguard the public health.
HIV Prevention Initiative
As a nation, we have made substantial progress in our fight to prevent the spread of HIV and
AIDS. Thanks to the use of combination anti-retroviral therapy, the AIDS death rates in the
United States continue to decline. But in some parts of the world, and in some communities in
the United States, the virus continues to spread rapidly. Domestically, the impact of HIV among
certain segments of the population, especially minority communities, continues to be severe. In
1997, 45 percent of those newly diagnosed with AIDS were African American and 20 percent
were Hispanic. Globally, the AIDS pandemic continues to be a major threat, particularly in
developing countries. In sub-Sahara Africa, for example, it is estimated that four million people
each year are newly infected with HIV. Internationally, the President's budget includes an
increase of $26 million for the Centers for Disease Control and Prevention to continue the
initiative undertaken last year to prevent the spread of HIV in developing countries.
Domestically, our budget request supports our ongoing initiative to reduce the spread of HIV and
AIDS in minority communities. It provides an increase of $50 million (including $10 million in
reallocated funding) for CDC's domestic prevention programs to encourage individuals at risk to
avoid behaviors that can result in the transmission of the disease. These funds will be directed to
community based interventions designed to reduce the rates of HIV infections, with special
emphasis on vulnerable populations including racial and ethnic minorities, women, injection
drug users and their partners, and young gay men. Internationally, the President's budget
includes $61 million for Centers for Disease Control and Prevention (CDC), an increase of $26
million, to continue the initiative undertaken last year to prevent the spread of HIV in developing
nations.
Ryan White
Up to one-third of the 750,000 Americans living with HIV are currently not in care. As we step
up our efforts to prevent the spread of AIDS, we must also continue to help those who already
suffer from this deadly disease. The President's budget keeps this commitment by providing
$1.7 billion for the Ryan White Program, an increase of $125 million. These additional funds
will provide primary medical care, pharmaceuticals critical to treatment, and other critical
support services for those living with HIV and AIDS. This includes an increase of $26 million
for the AIDS Drug Assistance Program (ADAP), which will allow a total of approximately
141,000 individuals to receive combination drug therapy.
Reducing Racial Health Disparities
One of the long-standing priorities of this administration has been making sure that all people
receive the highest quality health care, regardless of their race or ethnicity. Unfortunately,
members of minority groups, including American Indians and Alaska Natives, continue to bear a
disproportionate burden of the nation's disease and illness. The President's budget continues the
effort to eliminate these health disparities. A targeted response to this problem is the request of
$35 million to expand CDC's program of demonstration projects in six identified areas of health
disparities: infant mortality, cancer, heart disease, diabetes, HIV/AIDS, and immunizations.
Funds will support the continuation of ongoing projects and the development of projects in two
new communities. The budget also proposes increasing funding for the Office for Civil Rights
by nine percent, including new program resources to ensure that our racial health disparities
initiative has as strong civil rights nondiscrimination component. We also request an increase of
$229 million for the Indian Health Service, the largest funding increase in two decades, to
implement a multi-pronged effort to improve the quality of care for Native Americans.
Improving Mental Health Services
The Surgeon General's Report on Mental Health, released in December 1999, has focused new
attention on the plight of those who suffer from mental illness. While about one in five
Americans experiences a mental disorder in the course of a year, many of them will not receive
the treatment they need. To address this problem, the President's budget proposes an increase of
$100 million for mental health services provided by the Substance Abuse and Mental Health
Services Administration (SAMHSA). This includes an increase of $60 million for the Mental
Health Block Grant, to support state efforts to create comprehensive, community based systems
of care for both adults and children. It also proposes to create a new $30 million Targeted
Capacity Expansion Grant program to support prevention and early intervention services, as
well as local service expansion.
The budget request also continues funding of $78 million for projects provided by the
Congress in FY 2000 for Youth Violence Prevention activities. This includes $50 million for the
Safe Schools/Healthy Students program which supports activities to increase school safety,
mental illness prevention and treatment, and school violence prevention and early intervention
services.
Family Planning
Support for family planning services has been a key factor in preventing over one million
unintended pregnancies each year. Family Planning Clinics provide a range of valuable services
including sexually transmitted disease and cancer screening and prevention; HIV prevention and
education; and contraception services and counseling. As part of our strategy to prevent teen
pregnancies, these services have also contributed to reducing the teen pregnancy rate to its
lowest level on record (since 1976). Our FY 2001 budget request continues our strong
commitment to family planning services, providing an increase of $35 million over FY 2000.
These funds will support grants to family planning clinics which will enable approximately
5.75 million low-income clients to receive reproductive health services and clinical care.
Preventing Emerging Infectious Diseases
Thanks to the extraordinary advances in transportation and other technologies and the expansion
of international commerce, we truly live in a global community. While these advances have
resulted in numerous economic and cultural benefits, they also have placed increasing strains on
our public health system. Since 1970, more than 35 new infectious diseases have been identified.
More recently, we have begun to see the emergence of drug-resistant bacteria and viruses, and
the spread of older diseases to areas where they were previously unseen, such as the recent
outbreak of West Nile encephalitis in the New York City area. To combat these threats, our
budget requests a total of $202 million to support infectious disease prevention activities at the
Centers for Disease Control and Prevention. This includes an increase of $25 million to fight
emerging infectious diseases, of which $20 million would be used to support the development of
a national electronic disease surveillance system, which will enhance the ability of state and
local health offices to respond to multi-state outbreaks of diseases and to share information, both
among themselves and with CDC.
Combating Bioterrorism
The recent arrests of suspected terrorists at the Canadian border has reminded us all of the
serious threat that terrorism poses to the peace and prosperity of our nation. The threats posed
by bioterrorism are particularly deadly because of their communicability and their ability to
remain undetected for long periods of time. Continuing our efforts to prepare for and respond to
the consequences of a bioterrorist event, the Department's budget includes $265 million for
activities across agencies to mount a comprehensive public health effort to combat this deadly
threat. This strategy includes four major components. First, our budget strengthens critical
components of our public health infrastructure, including our surveillance systems,
epidemiological and laboratory capacity, and communications technology. Second, it continues
funds for the purchase of a stockpile of the pharmaceuticals needed to treat the most likely
biological agents. Third, it provides funds for research, development, and regulatory review of
new vaccines and new diagnostic screens for chemical agents. Finally, it would support the
establishment of an additional 25 local area health care response teams, bringing the total
number of teams around the country to 97.
Investing in HHS Laboratory and Health Infrastructure
To successfully overcome the public health challenges of the 21st century, we must invest now
to modernize the infrastructure that provides the foundation for our public health and biomedical
research systems. Many of the laboratories at CDC and FDA are overcrowded and outdated,
while at the National Institutes of Health (NIH) the fragmentation of laboratory space delays the
pace at which new discoveries are made. Our budget requests substantial increases to solidify
this foundation and construct state-of-the-art facilities. For CDC, we are requesting a total of
$127 million, an increase of $70 million, for laboratory construction at three sites. First, our
budget includes $85 million in FY 2001 and additional funding in FY 2002 and FY 2003 to
construct a laboratory to handle the most highly infectious and lethal pathogens studied at CDC,
as well as housing important work on antibiotic resistant diseases, AIDS, sexually transmitted
diseases, and tuberculosis . Second, we request $20 million to complete and equip the Edward
R. Roybal infectious disease laboratory. Third, we request $4 million to design a facility to
replace our antiquated environmental health laboratory. The remainder of the request will be
used for security improvements and maintenance of existing facilities.
For NIH, we are requesting $149 million for intramural buildings and facilities. Intramural
projects include $73 million over two years to construct a new facility to house the new National
Neuroscience Research Center, and $24 million to begin design and construction of a new
centralized animal facility. Our budget also includes $20 million for new lab construction at
FDA, as well as $65 million for health facilities construction in the Indian Health Service (IHS).
RIGOROUSLY EVALUATING PROGRAM PERFORMANCE
Our budget request for FY 2001 presents the annual performance information required by the
Government Performance and Results Act (GPRA) of 1993. Notably, this includes the first
GPRA performance report of HHS and its components, which compares FY 1999 results to the
goals in our FY 1999 performance plan. Although GPRA reporting must mature before its full
value will be realized, our performance report for this year shows improvements for critical HHS
initiatives of the past few years. SAMHSA reports that retailers in more States have complied
with rules prohibiting tobacco sales to youth than we had projected in our 1999 performance
plan. HCFA achieved its 1999 goal for reductions in Medicare payment errors a year early, and
pursues increasingly rigorous goals in FY 2001 and FY 2002. ACF and its program partners,
including states, exceeded performance expectations when they moved 1.3 million welfare
recipients into new employment. Information like this demonstrates that GPRA can be a
valuable tool that will enhance our efforts to improve programs that serve the American people.
As our performance measures continue to mature and performance trends emerge, the GPRA
data will serve as important program indicators to support the identification of strategies and
objectives to continuously improve programs across HHS.
A ROAD MAP TO A BETTER AMERICA
Mr. Chairman, as I look back at the journey we have taken, I feel tremendous pride in what we
have been able to accomplish. While there were occasional bumps in the road and we did not
reach every destination we set out for, we have made great advances in improving the nation's
health and well being. Today I have placed before you a road map for the destinations we have
charted - improving health care access, coverage, and quality; making America a healthier and
safer place; expanding our scientific knowledge, and giving all our children and families the
opportunity for success - and these are destinations we all wish to reach. Thanks to the
unprecedented economy, our fiscal discipline, and a new age of scientific breakthroughs, the
conditions under which we set out on this road have never been more favorable.
Chairman Porter, Congressmen Obey, and members of the Subcommittee: I would like to thank
each of you for all of the hard work you have done to make everything we have accomplished a
reality, and I look forward to working with all of you to meet the challenges before us in this
budget. The journey is not ending, it is just beginning. I would be happy to address any
questions you may have.
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