Labor, Health and Human Services, and Education: FY2018 Appropriations
Released: 2018-09-13T00:00:00

Introduction

This report provides an overview of FY2018 appropriations actions for accounts traditionally funded in the appropriations bill for the Departments of Labor, Health and Human Services, and Education, and Related Agencies (LHHS). This bill provides discretionary and mandatory appropriations to three federal departments: the Department of Labor (DOL), the Department of Health and Human Services (HHS), and the Department of Education (ED). In addition, the bill provides annual appropriations for more than a dozen related agencies, including the Social Security Administration (SSA).

Discretionary funds represent less than one-quarter of the total funds appropriated in the LHHS bill. Nevertheless, the LHHS bill is typically the largest single source of discretionary funds for domestic non-defense federal programs among the various appropriations bills (the Department of Defense bill is the largest source of discretionary funds among all federal programs). The bulk of this report is focused on discretionary appropriations because these funds receive the most attention during the appropriations process.

The LHHS bill typically is one of the more controversial of the regular appropriations bills because of the size of its funding total and the scope of its programs, as well as various related social policy issues addressed in the bill, such as restrictions on the use of federal funds for abortion and for research on human embryos and stem cells.

Congressional clients may consult the LHHS experts list in CRS Report R42638, Appropriations: CRS Experts , for information on which analysts to contact at the Congressional Research Service (CRS) with questions on specific agencies and programs funded in the LHHS bill.

Report Roadmap and Useful Terminology

This report is divided into several sections. The opening section provides an explanation of the scope of the LHHS bill (and hence, the scope of this report) and an introduction to important terminology and concepts that carry throughout the report. Next is a series of sections describing major congressional actions on FY2018 appropriations and (for context) a review of the conclusion of the FY2017 appropriations process. This is followed by a high-level summary and analysis of enacted and proposed appropriations for FY2018, compared to FY2017 funding levels. The body of the report concludes with overview sections for each of the major titles of the bill: DOL, HHS, ED, and Related Agencies. These sections provide selected highlights from FY2018 enacted and proposed funding levels compared to FY2017. (Note that the distribution of funds is sometimes illustrated by figures, which in all cases are based on the FY2018 enacted version of the LHHS bill. )

Finally, Appendix A provides a summary of budget enforcement activities for FY2018. This includes information on the Budget Control Act of 2011 (BCA; P.L. 112-25 ) and sequestration, as well as action associated with the Bipartisan Budget Act of 2018 (BBA 2018; P.L. 115-123 ), the FY2018 budget resolution, subcommittee spending allocations, and current-year spending levels. This is followed by Appendix B , which provides an overview of the LHHS-related floor amendments that were offered in the House during its consideration of H.R. 3354 , an omnibus appropriations measure that was ultimately not taken up by the Senate.

Scope of the Report

In general, this report is focused strictly on appropriations to agencies and accounts that are subject to the jurisdiction of the Labor, Health and Human Services, Education, and Related Agencies subcommittees of the House and Senate appropriations committees (i.e., accounts traditionally funded via the LHHS bill). Department "totals" provided in this report do not include funding for accounts or agencies that are traditionally funded by appropriations bills under the jurisdiction of other subcommittees.

The LHHS bill provides appropriations for the following federal departments and agencies:

the Department of Labor; most agencies at the Department of Health and Human Services, except for the Food and Drug Administration (funded through the Agriculture appropriations bill), the Indian Health Service (funded through the Interior-Environment appropriations bill), and the Agency for Toxic Substances and Disease Registry (also funded through the Interior-Environment appropriations bill); the Department of Education; and more than a dozen related agencies, including the Social Security Administration, the Corporation for National and Community Service, the Corporation for Public Broadcasting, the Institute of Museum and Library Services, the National Labor Relations Board, and the Railroad Retirement Board.

Note also that funding totals displayed in this report do not reflect amounts provided outside of the annual appropriations process. Certain direct spending programs, such as Old-Age, Survivors, and Disability Insurance and parts of Medicare, receive funding directly from their authorizing statutes; such funds are not reflected in the totals provided in this report because they are not provided through the annual appropriations process (see related discussion in the " Important Budget Concepts " section).

Important Budget Concepts

Mandatory vs. Discretionary Budget Authority2

The LHHS bill includes both discretionary and mandatory budget authority. While all discretionary spending is subject to the annual appropriations process, only a portion of mandatory spending is provided in appropriations measures.

Mandatory programs funded through the annual appropriations process are commonly referred to as appropriated entitlements . In general, appropriators have little control over the amounts provided for appropriated entitlements; rather, the authorizing statute controls the program parameters (e.g., eligibility rules, benefit levels) that entitle certain recipients to payments. If Congress does not appropriate the money necessary to meet these commitments, entitled recipients (e.g., individuals, states, or other entities) may have legal recourse.

Most mandatory spending is not provided through the annual appropriations process, but rather through budget authority provided by the program's authorizing statute (e.g., Old-Age, Survivors, and Disability Insurance). The funding amounts in this report do not include budget authority provided outside of the appropriations process. Instead, the amounts reflect only those funds, discretionary and mandatory, that are provided through appropriations acts.

Note that, as displayed in this report, mandatory amounts for the Trump Administration's budget submission reflect current-law (or current services) estimates; they generally do not include the President's proposed changes to a mandatory spending program's authorizing statute that might affect total spending. (In general, such proposals are excluded from this report, as they typically would be enacted in authorizing legislation.)

Note also that the report focuses most closely on discretionary funding. This is because discretionary funding receives the bulk of attention during the appropriations process. (As noted earlier, although the LHHS bill includes more mandatory funding than discretionary funding, the appropriators generally have less flexibility in adjusting mandatory funding levels than discretionary funding levels.)

Mandatory and discretionary spending is subject to budget enforcement processes that include sequestration. In general, sequestration involves largely across-the-board reductions that are made to certain categories of discretionary or mandatory spending. However, the conditions that trigger sequestration, and how it is carried out, differ for each type of spending. This is discussed further in Appendix A .

Total Budget Authority Provided in the Bill vs. Total Budget Authority Available in the Fiscal Year

Budget authority is the amount of money a federal agency is legally authorized to commit or spend. Appropriations bills may include budget authority that becomes available in the current fiscal year, in future fiscal years, or some combination. Amounts that become available in future fiscal years are typically referred to as advance appropriations .

Unless otherwise specified, appropriations levels displayed in this report refer to the total amount of budget authority provided in an appropriations bill (i.e., "total in the bill"), regardless of the year in which the funding becomes available. In some cases, the report breaks out "current-year" appropriations (i.e., the amount of budget authority available for obligation in a given fiscal year , regardless of the year in which it was first appropriated).

As the annual appropriations process unfolds, the amount of current-year budget authority is measured against 302(b) allocation ceilings (budget enforcement caps for appropriations subcommittees that traditionally emerge following the budget resolution process). The process of measuring appropriations against these spending ceilings takes into account scorekeeping adjustments , which are made by the Congressional Budget Office (CBO) to reflect conventions and special instructions of Congress. Unless otherwise specified, appropriations levels displayed in this report do not reflect additional scorekeeping adjustments.

FY2018 LHHS Appropriations Status

Table 1 provides a timeline of major legislative actions, and the remainder of this section provides additional detail on these and other steps toward full-year FY2018 LHHS appropriations.

FY2018 Rescissions Proposal

On May 8, 2018, the Trump Administration submitted to Congress a proposal for rescissions of budget authority totaling $15.8 billion. The proposal was submitted in accordance with Section 1012 of the Congressional Budget and Impoundment Control Act of 1974 (2 U.S.C. 683). In the proposal were a number of LHHS-related rescissions of both mandatory and discretionary funding for accounts at DOL, HHS, the Corporation for National and Community Service, and the Railroad Retirement Board.

After it was introduced as H.R. 3 , the House considered the measure and passed it by a vote of 210-206, on June 7, 2018. In the Senate, the measure was referred to the Senate Appropriations and Budget Committees. On June 20, 2018, a motion to discharge those committees from consideration of the measure was made in the Senate, but it was rejected by a vote of 48-50. No further action on this measure has occurred as of the date of this report.

FY2018 Omnibus Appropriations

On March 23, 2018, President Trump signed into law the Consolidated Appropriations Act, FY2018 ( H.R. 1625 , P.L. 115-141). The bill was agreed to in the House on March 22 and in the Senate on March 23. The bill provided regular, full-year appropriations for all 12 annual appropriations acts, including LHHS (Division H).

LHHS discretionary appropriations in the FY2018 omnibus totaled $186.5 billion (this total does not include emergency funding provided by an earlier supplemental appropriations act for FY2018, P.L. 115-123). This amount is 7.6% more than FY2017 levels and 25.3% more than the FY2018 budget request from the Trump Administration. The omnibus also provided $817.5 billion in mandatory funding, for a combined FY2018 LHHS total of $1.004 trillion.

See Figure 1 for a breakdown of FY2018 discretionary and mandatory LHHS appropriations.

FY2018 Supplemental Appropriations

The 2017 hurricane season was the fifth-most active on record in the Atlantic Basin, in terms of accumulated storm strength. Four named storms made landfall on U.S. soil from mid-August to mid-October, causing extensive damage. Concurrently, a series of deadly wildfires struck California. In response, two FY2018 supplemental appropriations laws were enacted, one on October 26, 2017 ( H.R. 2266 ; P.L. 115-72 ), and the other on February 9, 2018 ( H.R. 1892 ; P.L. 115-123 ). The second of these, which was enacted as part of the Bipartisan Budget Act of 2018, contained a total of $4.0 billion in supplemental appropriations for accounts and purposes traditionally associated with the LHHS appropriations bill, all of which were designated as emergency spending. These funds were distributed to DOL, HHS, and ED as follows:

$100 million to the Employment and Training Administration for dislocated worker assistance (DOL); $30.9 million to Job Corps (DOL); $200 million to the Centers for Disease Control and Prevention (CDC) for CDC-wide Activities and Program Support (HHS); $50 million to the National Institutes of Health (NIH) Office of the Director (HHS); $650 million to the Administration for Children and Families (ACF) Children and Family Services Programs account for the Head Start Program (HHS); $162 million to the HHS Office of the Secretary for the Public Health and Social Services Emergency Fund (HHS); $2.7 billion for Hurricane Education Recovery (ED); $5 billion for Higher Education Act waiver authority (ED); and $90 billion for the Historically Black Colleges and Universities Supplemental Loan Program (ED).

The FY2018 enacted totals throughout this report do not include these emergency funds.

FY2018 Continuing Resolutions

Full-year appropriations were not enacted by the start of FY2018 (October 1, 2017). As a consequence, temporary funding for LHHS was provided by a CR that was enacted on September 8, 2017 ( H.R. 601 , Division D; P.L. 115-56 ). A second CR, which extended the funding in the first CR, was enacted on December 8, 2017 ( H.J.Res. 123 ; P.L. 115-90 ). A third CR, which further extended funding, was enacted on December 22, 2017 ( H.R. 1370 ; P.L. 115-96 ). After a funding gap that commenced on January 20, 2018, a fourth CR was enacted two days later that extended funding through February 8, 2018 ( H.R. 195 ; P.L. 115-120 ), followed by a fifth CR that extended funding through March 23, 2018 ( H.R. 1892 ; P.L. 115-123 ). (This fifth CR was enacted in the Bipartisan Budget Act of 2018, in Division B, Subdivision 3.)

With limited exceptions, these CRs generally funded discretionary LHHS programs at FY2017 levels minus a reduction of about two-thirds of one percent (-0.6791%). Mandatory programs covered by the CRs were generally continued at current-law levels, less sequestration (where applicable). CR provisions specifically affecting LHHS programs were carried in Sections 101(a)(8), 135-139, and 145-146 of P.L. 115-56 , as amended by P.L. 115-96 .

For more information about the FY2018 continuing appropriations, see CRS Report R44978, Overview of Continuing Appropriations for FY2018 (P.L. 115-56) .

Congressional Action on an LHHS Bill

FY2018 LHHS Action in the House

The House Appropriations Committee's version of the FY2018 LHHS appropriations bill was ordered reported by the full committee on July 19, 2017, by a vote of 28-22, and reported to the House on July 24 ( H.R. 3358 ). It was previously approved in subcommittee on July 13 by a vote of 9-6.

As reported by the full committee, this bill would have provided $168.9 billion in discretionary LHHS funds, a 2.6% decrease from FY2017 enacted levels. This amount would have been 13.4% more than the FY2018 President's request. In addition, the House committee bill would have provided an estimated $817.4 billion in mandatory funding, for a combined total of $986.3 billion for LHHS as a whole.

While H.R. 3358 did not receive floor consideration in the House, the text of this measure (with minor alterations) was included in an omnibus appropriations bill, the Make America Secure and Prosperous Appropriations Act, 2018 ( H.R. 3354 ), which passed the House on September 14, 2017. As bill-wide numbers that incorporate the budgetary effects of the LHHS-related floor amendments to H.R. 3354 are generally not available, the House funding numbers in this report are based on H.R. 3358 , as reported by the House Appropriations Committee. The LHHS-related amendments that were offered in the House during consideration of H.R. 3354 are discussed in Appendix B .

FY2018 LHHS Action in the Senate

The Senate Appropriations Committee reported its version of the FY2018 LHHS appropriations bill on September 7, 2017, by a vote of 29-2 ( S. 1771 ). The LHHS subcommittee had reported the bill the previous day (September 6) by a voice vote.

This bill would have provided $174.4 billion in discretionary LHHS funds. This would have been 0.6% more than FY2017, and 17.2% more than the FY2018 President's request. In addition, the Senate committee bill would have provided an estimated $817.4 billion in mandatory funding, for a combined total of $991.9 billion for LHHS as a whole.

FY2018 President's Budget Request

On May 23, 2017, the Trump Administration released the FY2018 President's budget. The President requested $148.9 billion in discretionary appropriations for accounts funded by the LHHS bill, which is a decrease of 14.1% from FY2017 levels. In addition, the President requested $815.8 billion in annually appropriated mandatory funding, for a total of $964.7 billion for the LHHS bill as a whole.

Conclusion of the FY2017 Appropriations Process

On May 5, 2017, President Trump signed into law the Consolidated Appropriations Act, 2017 ( P.L. 115-31 ). This bill was agreed to in the House on May 3 and the Senate on May 4. The bill provided regular, full-year appropriations for 11 of the 12 annual appropriations acts, including LHHS (Division H).

The law provided a total of $173.3 billion in discretionary funding for LHHS. This total was roughly $3.1 billion (+1.8%) more than FY2016 levels and $900 million (+0.5%) more than the Obama Administration's FY2017 request. The omnibus also provided $760.6 billion in mandatory funding, for a combined FY2017 LHHS total of $934.0 billion.

Summary of FY2018 LHHS Appropriations

Table 2 displays FY2018 discretionary and mandatory LHHS budget authority provided or proposed, by bill title, along with FY2017 enacted levels. The amounts shown in this table reflect total budget authority provided in the bill (i.e., all funds appropriated in the bill, regardless of the fiscal year in which the funds become available), not total budget authority available for the current fiscal year. (For a comparable table showing current-year budget authority, see Table A-2 in Appendix A .)

Figure 2 displays the FY2018 enacted discretionary and mandatory LHHS funding levels, by bill title. (While the dollars and percentages discussed in this section were calculated based on the FY2018 enacted amounts, they are generally also illustrative—within several percentage points—of the share of funds directed to each bill title in FY2017 and under the other FY2018 proposals.)

As this figure demonstrates, HHS accounts for the largest share of total FY2018 LHHS appropriations: $848 billion, or 84.4%. This is due to the large amount of mandatory funding included in the HHS appropriation, the majority of which is for Medicaid grants to states and payments to health care trust funds. After HHS, ED and the Related Agencies represent the next-largest shares of total proposed LHHS funding, accounting for 7.4% and 6.8%, respectively. (The majority of the ED appropriations each year are discretionary, while the bulk of funding for the Related Agencies goes toward mandatory payments and administrative costs of the Supplemental Security Income program at the Social Security Administration.) Finally, DOL accounts for the smallest share of total LHHS funds, 1.4%.

When looking only at discretionary appropriations, however, the overall composition of LHHS funding is noticeably different. HHS accounts for a comparatively smaller share of total discretionary appropriations (47.3%), while ED accounts for a relatively larger share (38.0%). Together, these two departments represent the majority (85.3%) of discretionary LHHS appropriations. DOL and the Related Agencies account for a roughly even split of the remaining 14.7% of discretionary LHHS funds.

Department of Labor (DOL)

Note that all amounts in this section are based on regular LHHS appropriations only. Amounts in this section do not include mandatory funds provided outside of the annual appropriations process (e.g., direct appropriations for Unemployment Insurance benefits payments). All amounts in this section are rounded to the nearest million or billion (as labeled). The dollar changes and percentage changes discussed in the text are based on unrounded amounts. For consistency with source materials, amounts do not reflect sequestration or re-estimates of mandatory spending programs, where applicable.

About DOL

DOL is a federal department comprised of multiple entities that provide services related to employment and training, worker protection, income security, and contract enforcement. Annual LHHS appropriations laws direct funding to all DOL entities (see the text box). The DOL entities fall primarily into two main functional areas—workforce development and worker protection. First, there are several DOL entities that administer workforce employment and training programs—such as the Workforce Innovation and Opportunity Act (WIOA) state formula grant programs, Job Corps, and the Employment Service—that provide direct funding for employment activities or administration of income security programs (e.g., for the Unemployment Insurance benefits program). Also included in this area is the Veterans' Employment and Training Service (VETS), which provides employment services specifically for the veteran population. Second, there are several agencies that provide various worker protection services. For example, the Occupational Safety and Health Administration (OSHA), the Mine Safety and Health Administration (MSHA), and the Wage and Hour Division (WHD) provide different types of regulation and oversight of working conditions. DOL entities focused on worker protection provide services to ensure worker safety, adherence to wage and overtime laws, and contract compliance, among other duties. In addition to these two main functional areas, DOL's Bureau of Labor Statistics (BLS) collects data and provides analysis on the labor market and related labor issues.

FY2018 DOL Appropriations Overview

Table 3 displays FY2018 discretionary and mandatory DOL budget authority provided or proposed, along with FY2017 enacted levels. The FY2018 omnibus increased discretionary appropriations for DOL by 1.1% compared to the FY2017 enacted levels. By contrast, discretionary DOL appropriations would have decreased, compared to FY2017, under the FY2018 President's budget request (-19.4%), as well as the FY2018 House (-12.6%) and Senate committee bills (-0.5%). Of the total funding provided in the bill for DOL, roughly 89% is discretionary.

Selected DOL Highlights

The following sections present highlights from FY2018 enacted and proposed appropriations compared to FY2017 enacted appropriations for selected DOL accounts and programs.

Table 4 displays funding for DOL programs and activities discussed in this section.

Employment and Training Administration (ETA)

ETA administers the primary federal workforce development law, the Workforce Innovation and Opportunity Act (WIOA, P.L. 113-128 ). The WIOA, which replaced the Workforce Investment Act, was signed into law in July 2014 and authorizes appropriations for its programs through FY2020. WIOA's provisions went into effect in FY2015 and FY2016.

Title I of the WIOA, which authorizes more than half of all funding for the programs authorized by the four titles of WIOA, includes three state formula grant programs serving Adults, Youth, and Dislocated Workers. While the FY2018 omnibus provided an increase of $80 million (+3.0%) for the three WIOA state formula grant programs compared to FY2017, the President's budget would have reduced funding for all three of the state formula grant programs by $1.1 billion (-39.9%), compared to the FY2017 enacted levels.

The FY2018 omnibus provided $221 million for the Dislocated Workers Activities National Reserve (DWA National Reserve), which was the same level enacted in FY2017. The FY2018 President's budget and the House committee bill would have reduced funding for the DWA National Reserve by $104 million (-47.0%) and $91 million (-41.1%), respectively, while the Senate committee bill would have kept DWA National Reserve funding the same as FY2017. Finally, the FY2018 omnibus directed $30 million from the DWA National Reserve toward training and employment assistance for workers dislocated in both the Appalachian and lower Mississippi regions. The FY2017 omnibus had contained a set-aside of $20 million within the appropriation to provide employment and training assistance to workers dislocated from coal mines and coal-fired power plants, but that provision was not retained in the FY2018 omnibus.

The FY2018 omnibus provided $145 million for the Apprenticeship Grant program, which is $50 million (+52.6%) more than the level enacted in FY2017. The FY2018 Senate committee bill would have provided the same amount for the Apprenticeship Grant program as it received FY2017 ($95 million), whereas the President's budget would have decreased this amount to $90 million. The FY2018 House committee bill would have provided no funding for the program. In the report accompanying the House committee bill, the committee encourages ETA to work with the authorizing committees of jurisdiction to "enact an appropriate apprenticeship program authorization."

The FY2018 omnibus provided $400 million for the Community Service Employment for Older Americans (CSEOA) program, which was the same as the FY2017 enacted level. The President's budget and the House committee bill would have provided no funds for the program, while the Senate committee bill would have funded CSEOA at the FY2017 level. While the House committee recommended transferring CSEOA to the Administration for Community Living (ACL) in HHS, the FY2018 omnibus continued to fund CSEOA at DOL.

Bureau of International Labor Affairs (ILAB)

The FY2018 omnibus provided the same funding, $86 million, for ILAB as was provided in FY2017. The Senate committee bill would also have provided $86 million for ILAB. The FY2018 President's budget and the House committee bill would have decreased funding by $68 million (-78.5%) and $60 million (-69.2%), respectively, for ILAB, which provides research, advocacy, technical assistance, and grants to promote workers' rights in different parts of the world. Language in the House committee report indicated that the proposed reduction was intended to return ILAB to "its original mission of research, advocacy, and technical assistance."

Labor-Related General Provisions

Annual LHHS appropriations acts regularly contain general provisions related to certain labor issues. This section highlights selected DOL general provisions in the FY2018 omnibus.

The FY2018 omnibus continued a provision that has been included in LHHS appropriations acts since FY2016 that directs the Secretary of Labor to accept private wage surveys as part of the process of determining prevailing wages in the H-2B program, even in instances in which relevant wage data are available from the Bureau of Labor Statistics. The H-2B program allows for the temporary employment of foreign workers in non-agricultural sectors and requires these workers to be paid the "prevailing wage" (i.e., the average wage paid to similar workers in the local area). Under DOL regulations, private employer surveys may be considered only if the employer meets certain conditions.

The FY2018 omnibus also continued a provision that has been included in LHHS appropriations acts since FY2016 to exempt certain insurance claims adjusters from overtime protection for two years following a "major disaster."

In addition to continued provisions, the FY2018 omnibus included several new labor-related provisions. Among these new provisions, the FY2018 omnibus authorized the Secretary of Labor to

provide up to $2 million in "excess personal property" to apprenticeship programs to assist training apprentices; employ law enforcement officers or special agents to provide protection to the Secretary of Labor and certain other employees and family members at public events and in situations in which there is a "unique and articulable" threat of physical harm; and dispose of or divest "by any means the Secretary determines appropriate" all or part of the real property on which the Treasure Island Job Corps Center is located.

Finally, the FY2018 omnibus amended the tip pooling provisions of the Fair Labor Standards Act (FLSA) and made changes to previously issued regulations on tip pooling. As background, Section 3(m) of the FLSA allows tipped employees (i.e., employees "customarily and regularly" receiving more than $30 per month in tips) to pool tips. In 2011, DOL promulgated a final rule on Section 3(m) which, in part, clarified that the only valid uses of employee tips were for a tip credit or a tip pool among tipped employees, regardless of whether or not the employer uses the tip credit provisions of the FLSA. In other words, the 2011 final rule prohibited an employer from keeping employee tips or sharing those tips with non-tipped workers even when the employer pays the full minimum wage (i.e., did not use the tip credit). In 2017, DOL issued a Notice of Proposed Rulemaking (NPRM) that would permit the reallocation of pooled tips to both tipped and non-tipped workers in cases in which the employer paid at least the full federal minimum cash wage rather than using the tip credit provisions of the FLSA. The NPRM did not specify which non-tipped employees would be eligible for participation in tip pools. A final rule based on the NPRM has not yet been issued.

The FY2018 omnibus made two changes to the tip pooling provisions of the FLSA. First, the FY2018 omnibus amended Section 3(m) of the FLSA to codify that an employer is prohibited from keeping any portion of employee tips, regardless of whether or not the employer takes the tip credit. Second, the FY2018 omnibus provides that sections of the 2011 final rule "have no further force or effect until future action" is taken by the Wage and Hour Division. The effect of these changes is that employers who do not take the tip credit (i.e., pay the full federal minimum wage to employees) are not prohibited from allowing tipped and non-tipped employees from participating in tip pools, but in no case can an employer keep any portion of tips.

Department of Health and Human Services (HHS)

Note that all amounts in this section are based on regular LHHS appropriations only; they do not include funds for HHS agencies provided through other appropriations bills (e.g., funding for the Food and Drug Administration) or outside of the annual appropriations process (e.g., direct appropriations for Medicare or mandatory funds provided by authorizing laws, such as the Patient Protection and Affordable Care Act [ACA, P.L. 111-148 ]). All amounts in this section are rounded to the nearest million or billion (as labeled). The dollar changes and percentage changes discussed in the text are based on unrounded amounts. For consistency with source materials, amounts do not reflect sequestration or re-estimates of mandatory spending programs, where applicable.

About HHS

HHS is a large federal department composed of multiple agencies working to enhance the health and well-being of Americans. Annual LHHS appropriations laws direct funding to most (but not all) HHS agencies (see text box for agencies supported by the LHHS bill). For instance, the LHHS bill directs funding to five Public Health Service (PHS) agencies: the Health Resources and Services Administration (HRSA), Centers for Disease Control and Prevention (CDC), National Institutes of Health (NIH), Substance Abuse and Mental Health Services Administration (SAMHSA), and Agency for Healthcare Research and Quality (AHRQ). These public health agencies support diverse missions, ranging from the provision of health care services and supports (e.g., HRSA, SAMHSA), to the advancement of health care quality and medical research (e.g., AHRQ, NIH), to the prevention and control of infectious and chronic diseases (e.g., CDC). In addition, the LHHS bill provides funding for annually appropriated components of CMS, which is the HHS agency responsible for the administration of Medicare, Medicaid, the State Children's Health Insurance Program (CHIP), and consumer protections and private health insurance provisions of the ACA.

The LHHS bill also provides funding for two HHS agencies focused primarily on the provision of social services: the Administration for Children and Families (ACF) and the Administration for Community Living (ACL). ACF's mission is to promote the economic and social well-being of vulnerable children, youth, families, and communities. ACL was formed with a goal of increasing access to community supports for older Americans and people with disabilities. Finally, the LHHS bill also provides funding for the HHS Office of the Secretary (OS), which encompasses a broad array of management, research, oversight, and emergency preparedness functions in support of the entire department.

FY2018 HHS Appropriations Overview

Table 5 displays enacted and proposed FY2018 funding levels for HHS, along with FY2017 levels. In general, discretionary funds account for about 10% of HHS appropriations in the LHHS bill. Compared to the FY2017 funding levels, the FY2018 omnibus increased HHS discretionary appropriations by 12.8%. The House committee bill would have decreased HHS discretionary appropriations slightly, by 0.7%, whereas the Senate committee bill would have somewhat increased those appropriations by 2.1%. In contrast, the President requested a 19.3% decrease in discretionary HHS funding.

Figure 3 provides an HHS agency-level breakdown of FY2018 enacted appropriations. As this figure demonstrates, annual HHS appropriations are dominated by mandatory funding, the majority of which goes to CMS to provide Medicaid benefits and payments to health care trust funds. When taking into account both mandatory and discretionary funding, CMS accounts for $747.6 billion, which is 88.2% of all enacted appropriations for HHS. ACF and NIH account for the next-largest shares of total HHS appropriations, receiving about 4.5% apiece.

By contrast, when looking exclusively at discretionary appropriations, funding for CMS constitutes only about 5.0% of FY2018 enacted HHS appropriations. Instead, the bulk of discretionary appropriations went to the PHS agencies, which combined account for 62.5% of discretionary appropriations provided for HHS. NIH typically receives the largest share of all discretionary funding among HHS agencies (41.0% in FY2018), with ACF accounting for the second-largest share (25.9% in FY2018).

Special Public Health Funding Mechanisms

Annual appropriations for HHS public health service agencies are best understood in the context of certain additional funding mechanisms: the Public Health Service (PHS) Evaluation Set-Aside and the Prevention and Public Health Fund (PPHF). In recent years, LHHS appropriations have used these funding mechanisms to direct additional support to certain programs and activities.

Public Health Service Evaluation Tap

The PHS Evaluation Set-Aside, also known as the PHS Evaluation Tap, is a unique feature of HHS appropriations. It is authorized by Section 241 of the Public Health Service Act (PHSA), and allows the Secretary of HHS, with the approval of appropriators, to redistribute a portion of eligible PHS agency appropriations across HHS for program evaluation purposes.

The PHSA limits the set-aside to not less than 0.2% and not more than 1% of eligible program appropriations. However, LHHS appropriations acts have commonly established a higher maximum percentage for the set-aside and have distributed specific amounts of "tap" funding to selected HHS programs. Since FY2010, and including in FY2018, this higher maximum set-aside level has been 2.5% of eligible appropriations. (The House committee bill for FY2018 proposed that the set-aside be reduced to 2.4% of eligible appropriations. In contrast, both the Senate committee bill and the Trump Administration proposed an increase in the set-aside to 2.9% of eligible appropriations. )

Before FY2015, the PHS tap traditionally provided more than a dozen HHS programs with funding beyond their annual appropriations and, in some cases, was the sole source of funding for a program or activity. However, since FY2015 and including in FY2018, LHHS appropriations laws have directed tap funds to about a half dozen programs or activities within three HHS agencies (NIH, SAMHSA, and OS) and have not provided any tap transfers to AHRQ, CDC, and HRSA. This has been particularly notable for AHRQ, which had been funded primarily through tap transfers from FY2003 to FY2014, but has received discretionary appropriations since then. (The House committee bill generally would have maintained this distributional practice for FY2018. However, both the Senate committee bill and the President's budget proposed to expand the activities and agencies funded by the PHS tap to include the Public Health Scientific Services at the CDC.)

An additional change from past precedent occurred in FY2015, in which LHHS appropriations laws began to direct the largest share of tap transfers to NIH. As a result, NIH went from being by far the largest net donor of tap funds to a net recipient of tap funds. The FY2018 omnibus provided $923 million in tap transfers to NIH, a $98 million (+11.9%) increase over the FY2017 level. (The FY2018 House committee bill proposed that the NIH transfers be continued at FY2017 levels ($824 million), whereas the Senate committee bill would have increased the transfer by $250 million (+30.3%). In contrast, the President's request proposed that the transfer be reduced by $44 million (-5.4%).)

Prevention and Public Health Fund

The ACA both authorized and appropriated mandatory funding to three trust funds to support programs and activities within the PHS agencies. One of these, the Prevention and Public Health Fund (PPHF, ACA §4002, as amended), was given a permanent, annual appropriation that was intended to provide support each year to prevention, wellness, and related public health programs funded through HHS accounts.

The ACA had appropriated $2 billion in mandatory funds to the PPHF for FY2018, but this amount has been reduced by subsequent laws that decreased PPHF funding for FY2018 and other fiscal years. The Middle Class Tax Relief and Job Creation Act of 2012 ( P.L. 112-96 ) decreased total PPHF appropriations by $6.25 billion over the course of FY2013-FY2021. Later, the 21 st Century Cures Act ( P.L. 114-255 ) further reduced PPHF appropriations by $6.3 billion for FY2018 through FY2024. In addition, the FY2018 PPHF appropriation was subject to a 6.6% reduction due to sequestration of nonexempt mandatory spending. (For more information on sequestration, see the budget enforcement discussion in Appendix A .) This means that, after sequestration, the total PPHF appropriation available for FY2018 was $840.6 million, a $90 million reduction relative to FY2017.

PPHF funds are intended to supplement (sometimes quite substantially) the funding that selected programs receive through regular appropriations, and to fund new programs, particularly those newly authorized by the ACA. The ACA instructs the HHS Secretary to transfer amounts from the PPHF to HHS agencies for prevention, wellness, and public health activities. The President's annual budget request sets out the intended distribution and use of PPHF funds for each fiscal year. The Secretary determined how to distribute these funds for FY2010 through FY2013. However, starting with FY2014, provisions in annual appropriations acts and accompanying reports have explicitly directed the distribution of PPHF funds and prohibited the Secretary from making further transfers for those years.

The CDC commonly receives the largest share of annual PPHF funds. The amount provided to the CDC for FY2018, $801 million, was a $90 million (-10.1%) reduction relative to FY2017, and the same amount as proposed by the Senate committee bill. Both the President's budget request and the House committee bill would have reduced the PPHF transfer to the CDC to a lesser degree—by $51 million (-5.7%).

Selected HHS Highlights by Agency

This section begins with a limited selection of FY2018 discretionary funding highlights by HHS agency. The discussion is largely based on the enacted and proposed appropriations levels for FY2018, compared to FY2017 enacted levels. These summaries are followed by a brief overview of significant provisions from annual HHS appropriations laws that restrict spending in certain controversial areas, such as abortion and stem cell research. The section concludes with two tables ( Table 6 and Table 7 ) presenting more detailed information on FY2017 enacted and FY2018 proposed and enacted funding levels for HHS.

HRSA

The FY2018 omnibus provided $6.7 billion in discretionary budget authority for HRSA. This is $525 million (+8.4%) more than HRSA's FY2017 discretionary funding level and $1.2 billion (+21.6%) more than the FY2018 President's budget request.

The FY2018 omnibus provided $286 million for Title X Family Planning, the same as FY2017. For the third year in a row, the House committee bill had proposed eliminating funding for Title X of the PHSA and also prohibiting the use of other HHS funds to carry out Title X. In contrast, the FY2018 Senate bill and the FY2018 President's budget had proposed a flat funding level for Title X from FY2017, and no prohibition on the use of other HHS funds.

The FY2018 omnibus included a discretionary appropriation of $105 million for the National Health Service Corps (NHSC), departing from the recent practice of using solely mandatory funds for the NHSC. The explanatory statement accompanying the FY2018 omnibus directs these funds to be used to "improve access to quality opioid and substance use disorder treatment in rural and underserved areas nationwide."

The FY2018 omnibus also provided funding for a new Rural Communities Opioids Response program. The omnibus appropriated $100 million for this program within HRSA's Rural Health account. According to the explanatory statement, this appropriation is to be augmented by an additional $30 million from the amount appropriated to the NHSC. The explanatory statement indicated that the new Rural Communities Opioids Response program is to support treatment for and prevention of substance abuse disorders.

CDC

The FY2018 omnibus provided $7.2 billion in discretionary budget authority for CDC. This is $911 million (+14.5%) more than CDC's FY2017 funding level and $2.2 billion (+44.3%) more than the FY2018 President's budget request. The FY2018 omnibus did not direct any PHS tap funds to the CDC, continuing the practice started in FY2015. (The FY2018 President's budget had requested $143 million in tap funds.) However, the FY2018 omnibus did supplement discretionary CDC appropriations with transfers from two additional sources. First, the FY2018 omnibus directed $801 million in PPHF transfers to the CDC, which is $90 million (-10.1%) less than FY2017. Second, in a departure from recent practice, the omnibus directed $240 million from the HHS Nonrecurring Expenses Fund (NEF) to the CDC Buildings and Facilities account to support the construction of a new Biosafety Level 4 laboratory. The NEF was established by the Consolidated Appropriations Act of 2008 to enable the HHS Secretary to repurpose certain unobligated balances of expired discretionary funds appropriated to HHS from the General Fund. Funds transferred into the NEF are generally available to the Secretary for capital acquisitions across HHS, including facilities infrastructure and information technology. It has been uncommon for LHHS appropriations acts to specify that particular projects are to be funded by the NEF.

Outside of the Buildings and Facilities account, the CDC account receiving the largest percentage increase in the FY2018 omnibus was Injury Prevention and Control. The omnibus provided $649 million for this account, an increase of $363 million (+126.7%) from FY2017. Of the total amount appropriated for Injury Prevention and Control, the omnibus specified that $476 million be used for Opioid Prescription Drug Overdose (PDO) prevention activities. The explanatory statement called for CDC to use these funds to "advance the understanding of the opioid overdose epidemic and scale up prevention activities across all 50 States and Washington, D.C." The explanatory statement also called for CDC to reserve $10 million for a nationwide awareness and education campaign related to opioids.

NIH

The FY2018 omnibus provided $36.2 billion in discretionary budget authority for NIH. This is $2.9 billion (+8.7%) more than FY2017 and $10.3 billion (+40%) more than the Trump Administration's FY2018 discretionary request. In addition, the FY2018 omnibus directed $923 million in PHS tap transfers to NIH, an increase of $98.4 million (+11.9%) from FY2017. The entirety of the tap transfer was provided to the National Institute of General Medical Sciences (NIGMS), and was paired with an increase of $36.1 million (+2%) in discretionary appropriations.

In general, FY2018 enacted appropriations provided each of the NIH Institutes and Centers with an increase from FY2017; funding for the Buildings and Facilities account remained the same. Compared to FY2017, the largest percentage increases among NIH Institutes and Centers went to the National Institute on Drug Abuse (NIDA), which received a total of about $1.4 billion (+26.8%), the National Institute on Aging (NIA), which received about $2.6 billion total (+25.7%), and the National Institute of Neurological Disorders and Strokes (NINDS), which received about $2.1 billion total (+20.3%). Within the amounts appropriated to NINDS and NIDA, the omnibus reserved $250 million apiece for research on opioid addiction. The explanatory statement also encouraged NIDA to "commit additional funding to this effort from within its base budget." As was the case in FY2016 and FY2017, the explanatory statement on the FY2018 omnibus directed NIH to reserve a specific amount for Alzheimer's research. It called for NIH to direct $1.8 billion for Alzheimer's research, referring to it as an increase of about $414 million from FY2017. Reserving a specific dollar amount for a particular disease or area of research at NIH is a relatively new practice and constitutes a significant departure from past precedent.

The FY2018 discretionary total of $36.2 billion included $496 million appropriated to the NIH Innovation Account pursuant to the 21st Century Cures Act ( P.L. 114-255 ). The FY2018 explanatory statement directed NIH to transfer from the Innovation Account $300 million to the National Cancer Institute (NCI) to support cancer research and $43 million each to the National Institute of Neurological Disorders and Stroke (NINDS) and the National Institute of Mental Health (NIMH) to support the Brain Research through Advancing Innovative Neurotechnologies (BRAIN) Initiative. Of the remaining $110 million, $100 million is to be spent on the Precision Medicine Initiative, and $10 million is to be spent on regenerative medicine research.

SAMHSA

The FY2018 omnibus provided $5.0 billion in discretionary budget authority for SAMHSA. This is $1.4 billion (+38.5%) more than SAMHSA's FY2017 funding level and $1.7 billion (+53.3%) more than the President's FY2018 budget request. In addition, the FY2018 omnibus also directed $134 million in PHS evaluation tap funding and $12 million in PPHF funding to SAMHSA, which is the same as FY2017.

The FY2018 omnibus provided increases to every SAMHSA account (but not every program within an account), compared to FY2017. In some cases, the omnibus included appropriations for new programs. For instance, the omnibus provided $1.0 billion for a new State Opioid Response Grants program. Of the total appropriated for the new State Opioid Response Grants, $2.0 million is directed to the National Academy of Sciences to commission a review to identify outcomes achieved by the Comprehensive Addiction and Recovery Act (CARA; P.L. 114-198).

The explanatory statement accompanying the FY2018 omnibus clarified that the new $1.0 billion for State Opioid Response Grants is in addition to the $500 million appropriated for the State Targeted Response (STR) to the Opioid Crisis program authorized in the 21 st Century Cures Act. As in FY2017, the FY2018 omnibus appropriated $500 million for STR grants in an account within the HHS Office of the Secretary, but authorized HHS to transfer these funds elsewhere within the department. The SAMHSA operating plans for FY2017 and FY2018 indicate that the funding for these grants was transferred to SAMHSA. However, for consistency with source materials, the $500 million for these grants is included in totals for the HHS Office of the Secretary (not SAMHSA) in this report.

AHRQ

The FY2018 omnibus provided $334 million in discretionary budget authority to AHRQ. This was 3% more than the FY2017 level of $324 million. The FY2018 omnibus did not direct any PHS tap transfers to AHRQ, which is in keeping with practices since FY2015 but contrasts with earlier years (FY2003-FY2014) in which AHRQ had been funded primarily with tap transfers. The FY2018 omnibus continued to fund AHRQ as its own operating division, rejecting the President's proposal to consolidate AHRQ into NIH. The President's FY2018 request had proposed zero funding for AHRQ, proposing instead to continue funding many of AHRQ's activities through a new National Institute for Research on Safety and Quality (NIRSQ) in the NIH.

The explanatory statement accompanying the FY2018 omnibus instructed AHRQ to contract with an independent entity to study federally supported health services and primary care research, identifying gaps, areas for consolidation, and strategies to improve coordination.

CMS

The FY2018 omnibus provided $4.4 billion in discretionary budget authority for CMS. This was $20 million (+0.5%) more than FY2017 funding, and $76 million (+1.7%) more than the President's budget request. The omnibus appropriated $745 million for the Health Care Fraud and Abuse Control (HCFAC) account, 2.8% more than FY2017, and slightly less (-0.8%) than the President's budget. Of the total amount appropriated for HCFAC, $434 million was effectively exempt from the discretionary budget caps.

The omnibus provided the CMS Program Management account with a flat funding level of $3.7 billion. This account supports CMS program operations (e.g., claims processing, information technology investments, provider and beneficiary outreach and education, and program implementation), in addition to federal administration and other activities related to the administration of Medicare, Medicaid, the State Children's Health Insurance Program, and private health insurance provisions established by the ACA. The FY2018 appropriation was the same amount that was proposed by the Senate committee bill, but more than that proposed by both the President's budget (+2.3%) and the House committee bill (+6.3%). The omnibus maintained a general provision (§227), included in LHHS appropriations acts since FY2014, authorizing HHS to transfer additional funds into this account from the Medicare trust funds. The terms of the provision required that such funds be used to support activities specific to the Medicare program, limited the amount of the transfers to $305 million, and explicitly prohibited such transfers from being used to support or supplant funding for ACA implementation. The House committee bill would have eliminated this provision.

The omnibus retained a general provision (§222), included in annual LHHS appropriations since FY2015, preventing certain funds from being used to make risk corridor payments associated with health insurance exchanges. The ACA required HHS to administer a risk corridor program for qualified health plans (QHPs) offered through health insurance exchanges in calendar years 2014-2016. The risk corridor program does apply to QHPs, but those plans may be offered on and off the exchanges. Through this program, HHS was required to make payments to insurers who experienced high losses, while insurers who experienced high gains were required to remit a portion of those gains to HHS. The general provision continues to prohibit HHS from making risk corridor payments with funds appropriated to the CMS Program Management account from the Federal Hospital Insurance Trust Fund or the Federal Supplemental Medical Insurance Trust Fund, or with funds transferred to the CMS Program Management account from other accounts funded in the LHHS bill.

ACF

Total FY2018 discretionary appropriations for ACF were $22.9 billion, a $3.6 billion (+18.6%) increase over FY2017 funding levels. The House and Senate committee bills had proposed reductions relative to FY2017 of -3.9% and -0.9%, respectively, whereas the President's budget would have decreased ACF discretionary funding by roughly one-quarter relative to the prior year (-24.9%). (The President's budget would have achieved much of its proposed reduction by eliminating certain programs within ACF, such as the Low Income Home Energy Assistance Program (LIHEAP, which received $3.4 billion in FY2017), Preschool Development Grants ($250 million in FY2017), and the Community Services Block Grant (CSBG, $715 million in FY2017). None of these programs were eliminated in the FY2018 omnibus.)

Much of the increase for ACF was directed to the Child Care and Development Block Grant (CCDBG), which received $2.4 billion (+83.0%) more than the FY2017 level of $2.9 billion. The explanatory statement accompanying the FY2018 omnibus specified, "It is expected that this increase will support the full implementation of the CCDBG Act as reauthorized in 2014, including activities to improve the quality and safety of child care programs, increasing provider reimbursement rates, and ensuring health and safety standards are met."

Funding for the Refugee and Entrant Assistance Programs account was increased by $190 million (+11.4%) relative to the FY2017 funding level of $1.7 billion. (The President's budget would have reduced that account by 13.0%.) Within the account, funding for the Unaccompanied Alien Children program was increased to $1.3 billion (+$355 million relative to FY2017). In addition, funding for three activities (Social Services, Preventative Health, and Targeted Assistance), as proposed in the President's budget, were consolidated under a new line, "Refugee Support Services" and funded at about the same level that the total of those three activities received in FY2017 ($207 million).

ACL

The FY2018 omnibus provided $2.1 billion in discretionary budget authority for ACL. This was $178 million (+9.1%) more than FY2017. In addition, the FY2018 omnibus directed $28 million in PPHF transfers to ACL, the same as FY2017. The omnibus specified that the PPHF transfers were for the streamlined Alzheimer's Disease Program, chronic disease self-management, and elder falls prevention.

The explanatory statement accompanying the FY2018 omnibus agreed to the President's budget proposal to streamline ACL's four Alzheimer's disease programs (Alzheimer's Disease Supportive Services, Alzheimer's Disease Initiative—Specialized Supportive Services, Alzheimer's Disease Initiative—Communications, and the National Alzheimer's Call Center previously funded under Aging Network Support Activities) into a single Alzheimer's Disease Program.

Funding Restrictions Related to Certain Controversial Issues

Annual LHHS appropriations measures regularly contain broad restrictions related to certain controversial issues. For instance, annual LHHS appropriations acts commonly include provisions limiting the use of federal funds for abortions, the use of human embryos for research, needle exchange programs, and gun control advocacy.

Abortions: Since FY1977, annual LHHS appropriations acts have included provisions limiting the circumstances under which LHHS funds (including Medicaid funds) may be used to pay for abortions. Early versions of these provisions applied only to HHS, but since FY1994 most provisions have applied to the entire LHHS bill. Under current provisions, (1) abortions may be funded only when the life of the mother is endangered or in cases of rape or incest; (2) funds may not be used to buy a managed care package that includes abortion coverage, except in cases of rape, incest, or endangerment; and (3) federal programs and state and local governments that receive LHHS funding are prohibited from discriminating against health care entities that do not provide or pay for abortions or abortion services. The FY2018 omnibus retained these existing restrictions. In addition, the House committee bill proposed a new provision that was not enacted (§536) based on the Health Care Conscience Rights Act ( H.R. 940 , 114 th Congress). Among other things, this provision would have amended the ACA to specify that individuals/employers would not have to purchase/sponsor coverage of abortions or other items or services to which they have a moral or religious objection.

Human Embryo Research : Since FY1996, annual LHHS appropriations have included a provision prohibiting any LHHS funds (including NIH funds) from being used to create human embryos for research purposes or for research in which human embryos are destroyed. The FY2018 omnibus retained these existing restrictions.

Needle Exchange Programs : Since FY1990, annual LHHS appropriations have generally included a provision prohibiting any LHHS funds from being used for needle exchange programs (i.e., programs in which sterile needles or syringes are made available to injection drug users in exchange for used needles or syringes to mitigate the spread of related infections, such as Hepatitis and HIV/AIDS). Starting in FY2016, the provision was modified to allow funds to be used for needle exchange programs under the following conditions: (1) federal funds may not be used to purchase the needles, but may be used for other aspects of such programs; (2) the state or local jurisdiction must demonstrate, in consultation with CDC, that they are experiencing, or at risk for, a significant increase in hepatitis infections or an HIV outbreak due to injection drug use; and (3) the program must be operating in accordance with state and local law. The FY2018 omnibus retained these existing restrictions and conditions.

Gun Control: Since FY1997, annual LHHS appropriations have included provisions prohibiting the use of certain funds for activities that advocate or promote gun control. Early versions of these provisions applied only to CDC; since FY2012, annual appropriations acts also have included HHS-specific restrictions, in addition to restrictions that apply to all LHHS funds (including funds transferred from the PPHF). The FY2018 omnibus retained these existing restrictions. In addition, the explanatory statement accompanying the omnibus included new language addressing the scope of the statutory restriction:

While appropriations language prohibits the CDC and other agencies from using appropriated funding to advocate or promote gun control, the Secretary of Health and Human Services has stated the CDC has the authority to conduct research on the causes of gun violence.

Restrictions on ACA Implementation: Since FY2011, annual LHHS appropriations have included provisions limiting or altering the ability of HHS to implement various aspects of the ACA. The content and scope of these provisions has evolved over time. The FY2018 House committee bill contained two provisions related to this topic that were not included in the FY2018 omnibus. First, the FY2018 House committee bill (§229) would have prohibited any funds appropriated in the bill from being used for health insurance "navigator" programs required by Section 1311 of the ACA. (Navigators conduct public education activities to help consumers and small businesses make informed decisions about insurance. ) Further, the House committee bill would have prohibited LHHS appropriations from being used to "implement, administer, enforce, or further" any provision of the ACA, with limited exceptions (§524) and would have prohibited HHS from generating funds from offsetting collections derived through fees collected from qualified plans operating under health care exchanges. The Senate committee bill did not include comparable provisions. Certain other ACA-related provisions are discussed elsewhere in this report (e.g., see the "CMS" section).

Department of Education (ED)

Note that amounts in this section are based on regular LHHS appropriations only. They do not include mandatory funds provided outside of the annual appropriations process (e.g., direct appropriations for the Federal Direct Student Loan program and the Federal Pell Grant program). Amounts are rounded to the nearest million or billion (as labeled). The dollar and percentage changes discussed are based on unrounded amounts. For consistency with source materials, amounts do not reflect sequestration or re-estimates of mandatory spending programs, where applicable.

About ED

Federal policymakers established the U.S. Department of Education (ED) in 1980. Its mission is to "promote student achievement and preparation for global competitiveness by fostering educational excellence and ensuring equal access." Typically, about three-quarters of ED's discretionary appropriations go either to local educational agencies—which primarily use the funds to provide educational and related services for economically disadvantaged students and students with disabilities—or to low-income postsecondary students in the form of Pell Grants, which pay for college. The remainder of ED's discretionary budget provides for a wide range of activities, including (but not limited to) support for minority-serving institutions; educational research; and career, technical, and adult education.

The federal government provides roughly 7% of overall funding for elementary and secondary education in the United States. The majority of school funding—about 83%—comes from states and local districts, which have primary responsibility for the provision of elementary and secondary education. With regard to higher education, the federal government provided roughly 61% of undergraduate and graduate student aid in academic year (AY) 2016-2017.

FY2018 ED Appropriations Overview

Table 8 displays FY2018 discretionary and mandatory ED budget authority provided and proposed, along with FY2017 enacted levels. Discretionary funds represent the majority of ED's annual appropriations, accounting for roughly 95% of the FY2017 and FY2018 enacted levels. The FY2018 enacted discretionary ED appropriations were 3.9% higher than FY2017 levels. Proposed discretionary ED appropriations for FY2018 compared to FY2017 would have decreased under the President's budget (-7.8%) and the House committee bill (-3.2%), and would have increased only at the margins under the Senate committee bill (+0.04%).

Selected ED Highlights

The following sections highlight FY2018 appropriations for selected ED accounts and programs. Table 9 tracks funding levels for major ED budget and appropriations accounts.

School Improvement Programs

The Student Support and Academic Enrichment (SSAE) State Grants, commonly referred to as the "block grant program," are funded within the School Improvement Programs account. The SSAE are authorized under Title IV-A of the Elementary and Secondary Education Act (ESEA), as amended by the Every Student Succeeds Act (ESSA; P.L. 114-95). The program provides formula grants to state educational agencies (SEAs) and LEAs to provide students with access to a well-rounded education, improve school conditions for student learning, and improve the use of technology in order to improve the academic achievement and digital learning of students. LEAs must use allocated funds for three broad categories, or "buckets," of activities: (1) supporting well-rounded educational opportunities, (2) supporting safe and healthy students, and (3) supporting the effective use of technology. If an LEA applies for a grant of $30,000 or more, it must provide assurances in its application that it will use funds for activities in each of the three buckets. If an LEA receives a grant of less than $30,000, it is only required to provide an assurance that it will use funds for one of the buckets of activities.

The enacted FY2018 appropriation for the Title IV-A block grant was $1.1 billion, compared to an FY2017 appropriation level of $400 million (+175%). The House committee bill had recommended a funding level of $500 million for the program, while the Senate committee bill had recommended $450 million. The President did not request funds for the program for FY2018. The program is authorized at $1.6 billion for FY2018.

Federal Direct Student Loan Program Account

The William D. Ford Federal Direct Loan (Direct Loan) program, authorized under Title IV, Part D of the Higher Education Act of 1965 (HEA), as amended, is the primary federal student loan program administered by ED. The program makes loans available to undergraduate and graduate students and the parents of dependent undergraduate students to help them finance their postsecondary education expenses. An array of student loan forgiveness and repayment programs have been enacted. One such program is the Direct Loan Public Service Loan Forgiveness (PSLF) program. Under the PSLF program, borrowers who, on or after October 1, 2007, are employed full-time in certain public service jobs for 10 years while making 120 separate qualifying monthly payments on loans made through the Direct Loan program may be eligible to have any remaining balance of principal and interest on their loans forgiven. In general, funding for these student loan programs is provided as mandatory spending outside the LHHS bill.

The FY2018 omnibus established a new activity within the Federal Direct Student Loan Program Account. The activity authorizes ED to provide loan cancellations for eligible borrowers who would qualify for Direct Loan Public Service Loan Forgiveness (PSLF) program benefits, but for the fact that they made certain nonqualifying payments. To be eligible for the cancellation benefits under the new activity, borrowers must be in an eligible repayment plan and make payments of eligible amounts.

The FY2018 omnibus appropriated $350 million for loan cancellations under the new activity. The funds shall remain available until expended. Loan cancellations will be made on a "first-come, first-served" basis. The House committee bill and the Senate committee bill did not recommend funds for the activity in FY2018. The President did not request funds for the activity in FY2018.

Related Agencies

Note that all amounts in this section are based on regular LHHS appropriations only; they do not include funds provided outside of the annual appropriations process (e.g., mandatory appropriations for Old-Age, Survivors, and Disability Insurance benefit payments by the Social Security Administration). All amounts in this section are rounded to the nearest million or billion (as labeled). The dollar changes and percentage changes in the text are based on unrounded amounts. For consistency with source materials, amounts do not reflect sequestration or re-estimates of mandatory spending programs, where applicable.

FY2018 Related Agencies Appropriations Overview

Table 10 displays FY2018 proposed and enacted funding levels for LHHS related agencies, along with FY2017 levels. In general, discretionary funds constitute about 20% of total appropriations for LHHS related agencies each year. Although discretionary appropriations for related agencies would have been reduced by all three earlier proposals, the FY2018 omnibus increased that funding by about 2.8%. (The House appropriations committee bill would have decreased discretionary funding by 1.1%, the Senate committee bill by 3.6%, and the President's budget by 11.1%.)

The largest share of funding appropriated to related agencies in the LHHS bill consistently goes to the Social Security Administration (SSA). When taking into account both mandatory and discretionary funding, SSA usually represents roughly 97% of total appropriations to related agencies in the LHHS bill. The bulk of mandatory funding provided to SSA from the LHHS bill supports the Supplemental Security Income (SSI) program, which provides means-tested cash assistance to disabled adults and children and to seniors aged 65 or older.

When looking exclusively at discretionary funding, SSA received 84.8% of discretionary appropriations for LHHS related agencies in the FY2018 omnibus. Most of SSA's discretionary funding is used by the agency to administer the Social Security and SSI programs and to support CMS in administering portions of Medicare.

After SSA, the next-largest related agency in terms of appropriations is usually the Corporation for National and Community Service (CNCS), which accounted for about 1.6% of total LHHS appropriations to related agencies in FY2018. Typically, each of the remaining related agencies receives less than $1 billion from the annual LHHS appropriations bill. For more information, see Table 11 .

Selected Related Agencies Highlights

The following sections highlight FY2018 appropriations issues for selected related agencies. Table 11 tracks funding levels for these related agencies.

Corporation for National and Community Service

The CNCS is an independent federal agency that administers a variety of national and community service programs, such as AmeriCorps and the National Senior Volunteer Corps. The FY2018 omnibus provided $1.1 billion in total CNCS funding, a $34 million (+3.3%) increase over FY2017. The FY2018 President's budget had requested only $135 million (-86.9%) for this agency, noting that these funds would be used to execute an orderly shutdown of CNCS operations, with the agency's closure slated to be complete by the end of FY2018. Both the House and Senate committee bills rejected this proposal, with the House proposing to retain CNCS funding at its FY2017 level of $1.0 billion, while the Senate committee bill would have modestly reduced agency funding by $11 million (-1.1%).

SSA Limitation on Administrative Expenses (LAE)

The SSA LAE account, which provides nearly all of SSA's administrative funding, consists mainly of funds that are used by the agency to administer the Social Security and SSI programs, and also to support CMS in administering portions of Medicare. The account also contains funds that are specifically set aside for certain program integrity activities, such as continuing disability reviews (CDRs) and SSI non-medical redeterminations. The FY2018 omnibus provided $12.9 billion to the LAE account, which was an increase of $388 million (+3.1%) over the FY2017 enacted level. The President's request would have provided about $28 million less (-0.2%) for the LAE account relative to FY2017. The House committee bill would have decreased LAE funding by $92 million (-0.7%) compared to FY2017, while the Senate committee bill would have decreased LAE funding by $492 million (-3.9%).

Of the $12.9 billion provided to the LAE account for FY2018, more than $1.7 billion (13.5%) was dedicated to program integrity activities. The program integrity portion of the LAE account included $273 million in "base" funding subject to the discretionary spending caps established by the Budget Control Act of 2011, as well as additional funding that was effectively exempt from those caps and subject to an annual limit ("cap adjustment funding;" see Appendix A for further information). The FY2018 omnibus provided $1.5 billion in cap adjustment funding, which was the maximum amount permitted for FY2018. However, because federal law allowed more cap adjustment funding for FY2017 than for FY2018, the combined amount of program integrity funding enacted for FY2018 was $84 million (-4.6%) less than the combined amount enacted for FY2017. All three proposals would have also provided the maximum amount of cap adjustment funding permitted for FY2018.

National Labor Relations Board (NLRB)

The NLRB is an independent board that enforces provisions in the National Labor Relations Act (NLRA). The FY2018 omnibus maintained the FY2017 funding levels for the NLRB of $274 million. The House committee bill would have decreased funding for the NLRB by $25 million (-9.2%), while the Senate committee bill would have provided the same amount as FY2017.

The FY2018 omnibus retained a provision that has been included in the LHHS bill since FY2012 that prohibits any funds appropriated to the NLRB in the bill, or any prior appropriations act, from being used to issue a directive or regulation to provide employees a means of voting through any electronic method in an election determining representation for collective bargaining (§407). The FY2018 omnibus, however, did not include several NRLB-related provisions proposed by the House committee bill that would have

prohibited any funds made available by the bill from being used to enforce the NLRA against any Indian tribe (§407 of H.R. 3358 ); prohibited any funds made available by the bill from being used to issue, enforce, or litigate any administrative action related to changing the interpretation or application of the "joint employer" standard in effect as of January 1, 2014 (§408 of H.R. 3358 ); and prohibited any funds made available by the bill from being used in any way to change the standard for initial bargaining unit determination that differs from the standard set in a recent court decision (§409 of H.R. 3358 ).

Appendix A. Budget Enforcement Activities

The framework for budget enforcement under the congressional budget process has both statutory and procedural elements. The statutory elements include the discretionary spending limits and mandatory spending sequester derived from the Budget Control Act of 2011 (BCA; P.L. 112-25 ) and the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA; P.L. 99-177 ). The procedural elements are primarily associated with the budget resolution and limit both total discretionary spending and spending under the jurisdiction of each appropriations subcommittee.

Readers should note that the statutory budget enforcement requirements that apply to discretionary spending under the BCA were altered during the FY2018 appropriations cycle by the Bipartisan Budget Act of 2018 (BBA 2018; P.L. 115-123), which was enacted on February 9, 2018. This law increased the defense and nondefense discretionary spending limits for FY2018 and FY2019, and extended mandatory spending sequestration through FY2027. However, the initial LHHS spending limits associated with the budget resolution (referred to as "302(b) suballocations") were made in light of the lower statutory discretionary spending limits that were in effect at that time.

Budget Control Act and Sequestration

The BCA provides budget process mechanisms to reduce mandatory spending and further reduce discretionary spending over an extended period. For mandatory spending, reductions are to occur through sequestration in each of fiscal years between FY2013-FY2027. For discretionary spending, reductions occurred through sequestration in FY2013, but are to be achieved through lower discretionary spending limits for each of the fiscal years between FY2014-FY2021. The BCA does not require a sequester of discretionary spending in FY2014-FY2021 unless one or both of the statutory discretionary spending limits (defense and nondefense) is breached. Only discretionary spending subject to a given spending limit is affected by a breach of that limit, and the LHHS bill only includes funding in the nondefense category.

FY2018

On May 23, 2017, concurrent with the release of the President's budget, President Trump issued the required FY2018 sequestration order, calling for nonexempt mandatory spending to be reduced on October 1, 2017. The Office of Management and Budget (OMB) estimated that the FY2018 sequestration percentages would equal 2% of nonexempt Medicare spending and 6.6% of other nonexempt nondefense mandatory spending, for a total reduction of $17 billion in FY2018. (OMB also estimated an 8.9% reduction, totaling $724 million, in nonexempt defense mandatory spending, which does not affect LHHS funds.) With regard to discretionary spending, the FY2018 statutory spending limits were presented in the OMB FY2018 Sequestration Preview Report that was also released on May 23, 2017. These limits were based on current law at the time and calculated to be $549 billion for defense spending and $516 billion for nondefense spending.

On February 9, 2018, the BBA 2018 was enacted ( H.R. 1892 ; P.L. 115-123 ). In addition to providing the FY2018 supplemental appropriations that were discussed earlier in this report, the act extended the mandatory spending sequester through FY2027. It also increased the statutory discretionary spending limits for FY2018 and FY2019. The new FY2018 limits were $629 billion for defense spending (+80 billion) and $579 billion for nondefense spending (+$63 billion).

Once the FY2018 omnibus was enacted and allowable adjustments to the spending limits were made, OMB determined that the omnibus did not violate either the defense or the nondefense limit.

Cap Adjustments, Exemptions, and Special Rules

The BCA allows for certain adjustments to the discretionary spending limits for FY2012-FY2021. For LHHS, the BCA as originally enacted allowed increases to the nondefense limit (up to a point) to accommodate new budget authority for specified program integrity initiatives at HHS and the Social Security Administration (SSA). The Bipartisan Budget Act of 2015 amended the list of SSA activities that may be covered by this "cap adjustment" to include costs associated with work-related continuing disability reviews, Cooperative Disability Investigations, and fraud prosecutions by Special Assistant U.S. Attorneys. The Bipartisan Budget Act of 2015 also revised the amount of the allowable SSA adjustment amounts to be more generous in FY2017-FY2019 compared to what was previously allowed, but less generous in FY2021.

The BBA 2018 added a new cap adjustment that also involves a LHHS activity. This new cap adjustment allows increases to the nondefense limit (up to a point) to accommodate new budget authority for the DOL to help fund the reemployment services and eligibility assessments conducted by the states related to unemployment compensation.

Separate from these cap adjustments, the 21 st Century Cures Act (Cures Act, P.L. 114-255 ), which was enacted on December 13, 2016, included additional budget enforcement procedures related to the discretionary spending limits. These procedures apply to two accounts within the scope of the LHHS bill: the NIH Innovation Account and the Account for the State Response to the Opioid Abuse Crisis. The Cures Act created these accounts and authorized appropriations from them for specific fiscal years (FY2017-FY2026 for the NIH Innovation Account and FY2017-FY2018 for the Account for the State Response to the Opioid Abuse Crisis). The Cures Act further provided that subsequent discretionary appropriations from these accounts (up to the amounts authorized for each fiscal year) are to be subtracted from any cost estimates provided for purposes of budget controls. The Cures Act ensured that appropriations from these accounts will not count against any spending limits, such as the statutory discretionary spending limits imposed by the BCA; that is, the amounts appropriated from these accounts will be considered to be outside those limits.

In addition, although sequestration largely consists of automatic, across-the-board spending reductions, the law exempts a limited number of programs from sequestration and subjects others to special rules. The LHHS bill contains several programs that are exempt from sequestration, including Medicaid, payments to health care trust funds, Supplemental Security Income, Special Benefits for Disabled Coal Miners, retirement pay and medical benefits for commissioned Public Health Service officers, foster care and adoption assistance, and certain family support payments. The LHHS bill also contains several programs that are subject to special rules under sequestration, such as unemployment compensation, certain student loans, health centers, and portions of Medicare.

Budget Resolution and 302(b) Suballocations

The procedural elements of budget enforcement generally stem from requirements under the Congressional Budget Act of 1974 ( P.L. 93-44 ) that are associated with the adoption of an annual budget resolution. Through this process, the Appropriations Committee in each chamber receives a procedural limit on the total amount of discretionary budget authority for the upcoming fiscal year, referred to as a 302(a) allocation. The Appropriations Committee subsequently divides this allocation among its 12 subcommittees. These subcommittee-level spending limits are referred to as 302(b) suballocations. The 302(b) suballocations restrict the amount of budget authority available to each subcommittee for the agencies, projects, and activities under its jurisdiction, effectively acting as a cap on each of the 12 regular appropriations bills. Enforcement of the 302(a) allocation and 302(b) suballocations occurs through points of order.

For the FY2018 appropriations cycle, the House and the Senate did not adopt a budget resolution prior to the start of the fiscal year. In the absence of a budget resolution, the House Appropriations Committee chose to adopt "interim 302(b) suballocations" for the appropriations bills as those bills were marked up in full committee. The LHHS suballocation was adopted on July 19, 2017. Similarly, the Chair of the Senate Appropriations Committee released "funding guidance" on July 20, 2017, indicating the amount of funding that was to be assumed for each of the FY2018 appropriations bills in the Senate. The funding guidance and interim suballocations were not procedurally enforceable as the appropriations bills were being considered prior to FY2018.

Ultimately, a budget resolution for FY2018 ( H.Con.Res. 71 ) was adopted in the Senate on October 19, 2017, and in the House on October 26, 2017. However, neither the Senate nor the House appropriations committees reported 302(b) suballocations at that time. Instead, the Senate Appropriations Committee reported out its suballocations ( S.Rept. 115-219 ) on March 22, 2018, after final overall funding levels for FY2018 had been negotiated. No FY2018 suballocations have been reported by the House Appropriations Committee as of the date of this report.

For current-year LHHS discretionary funding, Table A-1 displays FY2017 enacted levels, House and Senate FY2018 interim discretionary spending levels, the Senate's current 302(b), and enacted FY2018 LHHS appropriations. The table shows that the House initially would have decreased regular LHHS appropriations by about $5.0 billion, whereas the Senate would have increased those appropriations by about $3.0 billion relative to FY2017. However, final enacted appropriations were about $16.1 billion higher than the prior year.

The table also displays funding for which adjustments may be made to the discretionary spending limits under the BCA, including funding for certain LHHS program integrity activities and emergency requirements, where applicable. The "adjusted appropriations" total includes this funding.

Note that compliance with discretionary spending allocations is evaluated based on budget authority available in the current fiscal year , adjusted for scorekeeping by CBO. As such, totals shown in this table may not be comparable to other totals shown in this report. Current-year budget authority totals exclude advance appropriations for future years, but include advance appropriations from prior years that become available in the current year. (Advance appropriations are provided to selected LHHS accounts, generally in order to manage specific planning concerns and ensure continuity of operations at the start of a new fiscal year.)

Current-Year Budget Authority

Table A-2 displays the total LHHS current-year budget authority, by title. The amounts shown in this table reflect total budget authority available for obligation in the fiscal year, regardless of the year in which it was first appropriated. Amounts in the FY2017 enacted column include FY2017 budget authority provided by the FY2016 omnibus (P.L. 114-113). Similarly, the FY2018 President's budget, House committee, Senate committee, and Enacted columns include FY2018 budget authority provided by the FY2017 omnibus ( P.L. 115-31 ). (For a comparable table showing total budget authority in the bill, rather than current-year budget authority, see Table 2 in the body of this report.) As mentioned above, it is current-year budget authority (adjusted for scorekeeping by CBO) that is used to determine compliance with discretionary spending allocations.

Appendix B. House Floor Amendments Offered to H.R. 3354

While the House committee-reported version of the LHHS bill ( H.R. 3358 ) did not receive floor consideration, the text of this measure (with minor alterations) was included in an omnibus appropriations bill ( H.R. 3354 ) that was amended on the floor and passed by the House on September 14, 2017. No further congressional action occurred with regard to H.R. 3354 .

The timing of the FY2018 appropriations process and the manner in which LHHS appropriations were considered was affected by multiple factors. One factor is that the release of the FY2018 President's budget was delayed by more than three months due to the presidential transition from the Administration of President Barack H. Obama to the Administration of President Donald J. Trump. (The full FY2018 President's budget request was ultimately released on May 22, 2017.) In addition, final FY2017 appropriations were not enacted until May 5, 2017 ( P.L. 115-31 ), roughly seven months into the fiscal year. As a result, final FY2017 appropriations levels were largely unknown as the FY2018 President's budget was being formulated and consideration of FY2018 appropriations began shortly after final FY2017 appropriations were determined.

Due to the condensed timeline available for considering appropriations prior to the start of FY2018, the House decided to consider and amend the 12 appropriations bills on the floor in the form of two omnibus packages. The first of these packages, the Make America Secure Appropriations Act, 2018 ( H.R. 3219 ), which contained 4 of the 12 appropriations acts (none of which were the LHHS act) was passed by the House on July 27, 2017. The second of these packages, the Make America Secure and Prosperous Appropriations Act, 2018 ( H.R. 3354 ), was used to consider and amend the remaining eight appropriations acts, including LHHS. (The text of the LHHS Appropriations Act that was included in Division F of H.R. 3354 was virtually identical to the text of H.R. 3358 as reported from committee.)

The LHHS-related amendments to H.R. 3354 were considered under the terms of a special rule ( H.Res. 504 ). Of the 52 LLHS amendments that were offered, 35 were adopted, 15 were rejected, and 2 were withdrawn. These amendments and their dispositions are listed in Table B-1 below.

Readers should note that a number of these amendments would have increased funding for certain activities while decreasing funding for administration at the department level. For example, nine amendments were adopted that would have reduced the amount of funds in the HHS General Department Management account. In total, these amendments would have reduced the funds in the bill for that account from $293 million to $39 million. In addition, six amendments to the ED Program Administration account within Departmental Management would have collectively reduced the funds for that account from $431 million to $286 million. Because these types of accounts provide appropriations to administer the LHHS activities under the purview of the bill, cuts of this magnitude, if they had been enacted, could have had direct or indirect effects on how those activities were carried out.