II

106TH CONGRESS

1ST SESSION S. 1504

To improve health care quality and reduce health care costs by establishing

a National Fund for Health Research that would significantly expand

the Nation’s investment in medical research.

IN THE SENATE OF THE UNITED STATES

AUGUST 5, 1999

Mr. HARKIN (for himself and Mr. SPECTER) introduced the following bill;

which was read twice and referred to the Committee on Health, Education, Labor, and Pensions

A BILL

To improve health care quality and reduce health care costs

by establishing a National Fund for Health Research

that would significantly expand the Nation’s investment

in medical research.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘National Fund for

5 Health Research Act’’.

6 SEC. 2. FINDINGS.

7 Congress finds the following:
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1 (1) Only 30 percent of peer reviewed research

2 projects deemed worthy of funding by the National

3 Institutes of Health are funded.

4 (2) Less than 3 percent of the over 1 trillion

5 dollars that our Nation spends on health care is de6 voted to health research, while the defense industry

7 spends 15 percent of its budget on research and de8 velopment.

9 (3) Public opinion surveys have shown that

10 Americans want more Federal resources put into

11 health research and are willing to pay for it.

12 (4) Ample evidence exists to demonstrate that

13 health research has improved the quality of health

14 care in the United States. Advances such as the de15 velopment of vaccines, the cure of many childhood

16 cancers, drugs that effectively treat a host of dis17 eases and disorders, a process to protect our Na18 tion’s blood supply from the HIV virus, progress

19 against cardiovascular disease including heart attack

20 and stroke, and new strategies for the early detec21 tion and treatment of diseases such as colon, breast,

22 and prostate cancer clearly demonstrates the bene23 fits of health research.

24 (5) Health research which holds the promise of

25 prevention of intentional and unintentional injury
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1 and cure and prevention of disease and disability, is

2 critical to holding down health care costs in the long

3 term.

4 (6) Expanded medical research is also critical

5 to holding down the long-term costs of the medicare

6 program under title XVIII of the Social Security Act

7 (42 U.S.C. 1395 et seq.). For example, recent re8 search has demonstrated that delaying the onset of

9 debilitating and costly conditions like Alzheimer’s

10 disease could reduce general health care and medi11 care costs by billions of dollars annually.

12 (7) The state of our Nation’s research facilities

13 at the National Institutes of Health and at univer14 sities is deteriorating significantly. Renovation and

15 repair of these facilities are badly needed to main16 tain and improve the quality of research.

17 (8) Because discretionary spending is likely to

18 decline in real terms over the next 5 years, the Na19 tion’s investment in health research through the Na20 tional Institutes of Health is likely to decline in real

21 terms unless corrective legislative action is taken.

22 (9) A health research fund is needed to main23 tain our Nation’s commitment to health research

24 and to increase the percentage of approved projects
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1 which receive funding at the National Institutes of

2 Health.

3 (10) Americans purchase health insurance and

4 participate in the medicare program to protect them5 selves and their families against the high cost of ill6 ness and disability. Because of this, it makes sense

7 to devote at least 1 cent of every health insurance

8 dollar to finding preventions, cures, and improved

9 treatments for illnesses and disabilities through

10 medical research.

11 SEC. 3. ESTABLISHMENT OF FUND.

12 (a) ESTABLISHMENT.—There is established in the

13 Treasury of the United States a fund, to be known as the

14 ‘‘National Fund for Health Research’’ (referred to in this

15 section as the ‘‘Fund’’), consisting of such amounts as are

16 transferred to the Fund under subsection (b) and any in17 terest earned on the investment of amounts in the Fund.

18 (b) TRANSFERS TO FUND.—

19 (1) IN GENERAL.—The Secretary of the Treas20 ury shall transfer to the Fund amounts equivalent to

21 amounts designated under paragraph (2) and re22 ceived in the Treasury.

23 (2) HEALTH PLAN SET ASIDE.—With respect to

24 each calendar year beginning with the first full cal25 endar year after the date of enactment of this Act,
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1 each health plan shall set aside and transfer to the

2 Treasury of the United States an amount equal to—

3 (A) for the first full calendar year, .5 per4 cent of all health premiums received with re5 spect to the plan for such year; and

6 (B) for the second and each succeeding full

7 calendar year, 1 percent of all health premiums

8 received with respect to the plan for such year.

9 (3) TRANSFERS BASED ON ESTIMATES.—The

10 amounts transferred by paragraph (1) shall annually

11 be transferred to the Fund within 30 days after the

12 President signs an appropriations Act for the De13 partments of Labor, Health and Human Services,

14 and Education, and related agencies, or by the end

15 of the first quarter of the fiscal year. Proper adjust16 ment shall be made in amounts subsequently trans17 ferred to the extent prior estimates were in excess

18 of or less than the amounts required to be trans19 ferred.

20 (4) DEFINITION.—As used in this subsection,

21 the term ‘‘health plan’’ means a group health plan

22 (as defined in section 2791(a) of the Public Health

23 Service Act (42 U.S.C. 300gg–91(a))) and any indi24 vidual health insurance (as defined in section
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1 2791(b)(5) of such Act (42 U.S.C. 300gg–91(b)(5)))

2 operated by a health insurance issuer.

3 (c) OBLIGATIONS FROM FUND.—

4 (1) IN GENERAL.—Subject to the provisions of

5 paragraph (4), with respect to the amounts made

6 available in the Fund in a fiscal year, the Secretary

7 of Health and Human Services shall distribute—

8 (A) 2 percent of such amounts during any

9 fiscal year to the Office of the Director of the

10 National Institutes of Health to be allocated at

11 the Director’s discretion for the following

12 activities—

13 (i) for carrying out the responsibilities

14 of the Office of the Director, including the

15 Office of Research on Women’s Health and

16 the Office of Research on Minority Health,

17 the Office of Rare Disease Research, the

18 Office of Behavioral and Social Sciences

19 Research (for use for efforts to reduce to20 bacco use), the Office of Dietary Supple21 ments, and the Office for Disease Preven22 tion; and

23 (ii) for construction and acquisition of

24 equipment for or facilities of or used by

25 the National Institutes of Health;
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1 (B) 2 percent of such amounts for transfer

2 to the National Center for Research Resources

3 to carry out section 481A of the Public Health

4 Service Act (42 U.S.C. 287a–2) concerning

5 Biomedical and Behavioral Research Facilities;

6 (C) 1 percent of such amounts during any

7 fiscal year for carrying out section 301 and

8 part D of title IV of the Public Health Service

9 Act (42 U.S.C. 241 and 286 et seq.) with re10 spect to health information communications;

11 and

12 (D) the remainder of such amounts during

13 any fiscal year to member institutes and cen14 ters, including the Office of AIDS Research, of

15 the National Institutes of Health in the same

16 proportion to the total amount received under

17 this section, as the amount of annual appro18 priations under appropriations Acts for each

19 member institute and Centers for the fiscal year

20 bears to the total amount of appropriations

21 under appropriations Acts for all member insti22 tutes and Centers of the National Institutes of

23 Health for the fiscal year.

24 (2) PLANS OF ALLOCATION.—The amounts

25 transferred under paragraph (1)(D) shall be allo-
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1 cated by the Director of the National Institutes of

2 Health or the various directors of the institutes and

3 centers, as the case may be, pursuant to allocation

4 plans developed by the various advisory councils to

5 such directors, after consultation with such direc6 tors.

7 (3) GRANTS AND CONTRACTS FULLY FUNDED

8 IN FIRST YEAR.—With respect to any grant or con9 tract funded by amounts distributed under para10 graph (1), the full amount of the total obligation of

11 such grant or contract shall be funded in the first

12 year of such grant or contract, and shall remain

13 available until expended.

14 (4) TRIGGER AND RELEASE OF MONIES AND

15 PHASE-IN.—

16 (A) TRIGGER AND RELEASE.—No expendi17 ture shall be made under paragraph (1) during

18 any fiscal year in which the annual amount ap19 propriated for the National Institutes of Health

20 is less than the amount so appropriated for the

21 prior fiscal year.

22 (B) PHASE-IN.—The Secretary of Health

23 and Human Services shall phase-in the distribu24 tions required under paragraph (1) so that—
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1 (i) 50 percent of the amount in the

2 Fund is distributed in the first fiscal year

3 for which funds are available; and

4 (ii) 100 percent of the amount in the

5 Fund is distributed in the second and each

6 succeeding fiscal year for which funds are

7 available.

8 (d) BUDGET TREATMENT OF AMOUNTS IN FUND.—

9 The amounts in the Fund shall be excluded from, and

10 shall not be taken into account, for purposes of any budget

11 enforcement procedure under the Congressional Budget

12 Act of 1974 or the Balanced Budget and Emergency Def13 icit Control Act of 1985.

Æ