Department of Health and Human Services: FY2018 Budget Request
Released: 2017-07-06T00:00:00

About HHS

The mission of the U.S. Department of Health and Human Services (HHS) is to "enhance the health and well-being of Americans by providing for effective health and human services and by fostering sound, sustained advances in the sciences underlying medicine, public health, and social services." HHS is currently organized into 11 main agencies, called "operating divisions," which are responsible for a wide variety of health and human services and related research (see a list of these agencies in the G lossary below). In addition, HHS has a number of "staff divisions" within the Office of the Secretary (OS). These staff divisions fulfill a broad array of management, research, oversight, and emergency preparedness functions in support of the entire department.

Eight of the HHS operating divisions are part of the U.S. Public Health Service (PHS). PHS agencies have diverse missions in support of public health, ranging from the provision of health care services and supports (e.g., IHS, 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 and environmental health hazards (e.g., CDC, ATSDR), and the regulation of food and drugs (e.g., FDA).

The three remaining HHS operating divisions are not PHS agencies: ACF, ACL, and CMS. ACF and ACL largely administer human services programs focused on the well-being of vulnerable children, families, older Americans, and individuals with disabilities. CMS—which accounts for the largest share of the HHS budget by far—is responsible for administering the Medicare and Medicaid programs, and some aspects of the private health insurance market.

Overview of the FY2018 HHS Budget Request

The HHS budget request for FY2018 was affected by two notable circumstances. The first was a presidential transition, from the Administration of President Barack H. Obama to the Administration of President Donald J. Trump, occurring in late January 2017. As a result of this transition, the full FY2018 budget submission was delayed until May 22, 2017.

The second notable circumstance affecting the FY2018 HHS budget request is that final FY2017 appropriations ( P.L. 115-31 ) were not enacted until May 5, 2017, about two weeks before the FY2018 budget was submitted. Consequently, final appropriations levels for FY2017 were largely unknown during the formulation of the FY2018 budget proposal, and the HHS budget does not include a display of FY2017-enacted levels. The HHS budget instead displays FY2017 estimates derived from two sources:

For discretionary spending programs, the HHS budget displays annualized estimates of funding provided under the second FY2017 continuing resolution (CR, P.L. 114-254 ). Generally, this CR was a formulaic extension of FY2016 funding levels with an across-the-board adjustment and exceptions for particular accounts and activities. For mandatory spend ing programs, the HHS budget displays estimates of the amounts expected to be needed for FY2017 based on criteria outlined in authorizing law. (For related discussion, see " Budgetary Resources versus Appropriations .")

While the estimates of annualized spending under the FY2017 CR may have informed FY2018 budget negotiations within the Administration, these estimates (in particular) should not be treated as FY2017 "final" or enacted levels for the purposes of comparison to prior years or the FY2018 proposal.

Under the budget request, HHS would spend an estimated $1.131 trillion in outlays in FY2018 (see Table 1 ). This is $422 million (+0.04%) more than the FY2017 estimate (based on the annualized CR and current services mandatory spending), and about $28 billion (+2.55%) more than FY2016 actual. The Office of Management and Budget (OMB) estimates that HHS will account for more than a quarter of all federal outlays (nearly 28%) in FY2018. HHS has accounted for at least 20% of all federal outlays in each year since FY1995.

Figure 1 displays proposed FY2018 HHS outlays by major program or spending category in the President's request. As this figure shows, mandatory spending typically accounts for the vast majority of the HHS budget. In fact, two programs—Medicare and Medicaid—are expected to account for 88% of all estimated HHS spending in FY2018. Medicare and Medicaid are "entitlement" programs, meaning the federal government is required to make mandatory payments to individuals, states, or other entities based on criteria established in authorizing law.

This figure also shows that discretionary spending accounts for only about 7% of FY2018 HHS outlays in the President's request. Although discretionary spending represents a relatively small share of total HHS spending, the department nevertheless receives more discretionary money than most federal departments.

According to OMB data, more than half of the President's request for discretionary budget authority in FY2018 would go to the Department of Defense (56%), with the second largest share going to the Department of Veterans Affairs (7%). HHS would receive the third largest share (nearly 6%) of all discretionary budget authority requested by the President, followed by the Department of Education (5%).

Budgetary Resources versus Appropriations

Readers should be aware that the HHS budget includes a broader set of budgetary resources than the amounts provided to HHS through the annual appropriations process. As a result, certain amounts shown in FY2018 HHS budget materials (including amounts for prior years) will not match amounts provided to HHS by annual appropriations acts and displayed in accompanying congressional documents. There are several reasons for this, described throughout this section.

First, mandatory spending makes up a large portion of the HHS budget and much of that spending is provided directly by authorizing laws, not through appropriations acts. All discretionary spending is controlled and provided through the annual appropriations process. By contrast, all mandatory spending is controlled by the program's authorizing statute. In most cases, that authorizing statute also provides the funds for the program. However, the budget authority for some mandatory programs, including Medicaid, while controlled by criteria in the authorizing statute, must still be provided through the annual appropriations process; such programs are commonly referred to as "appropriated entitlements" or "appropriated mandatories."

In addition, the HHS budget request takes into account the department as a whole, while the appropriations process divides HHS funding across three different appropriations bills. While most of the discretionary spending for the department is provided through the Departments of Labor, Health and Human Services, and Education, and Related Agencies (LHHS) Appropriations Act, funding for certain HHS agencies and activities is appropriated in two other bills—the Departments of the Interior, Environment, and Related Agencies Appropriations Act (INT) and the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act (AG). Table 2 lists HHS agencies by appropriations bill.

Moreover, the Administration's estimates for HHS programs may follow different conventions than congressional scorekeepers. For example, certain transfers of funding between HHS agencies (or from HHS to other federal agencies) that occurred in prior fiscal years, or are expected to occur in this fiscal year, may be accounted for in the Administration estimates but not necessarily in the congressional documents.

In addition, HHS budget materials may include two different estimates for mandatory spending programs in FY2018: proposed law and current law . Proposed law estimates take into account changes in mandatory spending proposed in the FY2018 HHS budget request. Such proposals would need to be enacted into law to affect the budgetary resources ultimately available to the mandatory spending program. HHS materials may also show a current law or current services estimate for mandatory spending programs. These estimates assume that no changes will be made to existing policies, and instead estimate mandatory spending for programs based on criteria established in current authorizing law. The HHS budget estimates in this report reflect the proposed law estimates for mandatory spending programs, but readers should be aware that other HHS, OMB, or congressional estimates might reflect current law instead.

Finally, the amounts of discretionary spending provided in the appropriations bills do not necessarily account for all of the budgetary resources that are available to those agencies. This is because agencies within HHS may have the authority to expend user fees and other types of collections that effectively supplement those appropriations. In addition, agencies may receive transfers of budgetary resources from other sources, such as from the Public Health Service Evaluation Set-Aside (also referred to as the PHS Tap) or one of the mandatory trust funds established by the Patient Protection and Affordable Care Act (ACA, P.L. 111-148 ). Budgetary totals that account for these sorts of resources in the Administration estimates are referred to as being at the "program level." HHS agencies that have historically had notable differences between the amounts in the appropriations bills and their program level include the Food and Drug Administration (due to user fees) and the Agency for Healthcare Research and Quality (due to transfers). The program level for each agency is listed in the table entitled, "Composition of the HHS Budget Discretionary Programs" in the HHS FY2018 Budget in Brief (BIB).

HHS Budget by Operating Division

Table 3 displays budgetary totals for each HHS operating division. These totals are inclusive of both mandatory and discretionary spending. The FY2016 actual, FY2017 estimate (based on the annualized CR and current services mandatory spending), and FY2018 request figures are taken from the HHS BIB for FY2018; the FY2015 actual figures are taken from the FY2017 BIB.

The remainder of this section provides a brief summary of the mission of each operating division, the FY2018 budget request, and links to additional resources related to that request. (Links are also provided to resources on amounts enacted for FY2017 in the Consolidated Appropriations Act, 2017.) A table of Key Policy Staff is included at the end of the report.

The figures in this section are provided in terms of budget authority and outlays. Budget authority (BA) is the authority provided by federal law to enter into contracts or other financial obligations that will result in immediate or future expenditures involving federal government funds. Outlays occur when funds are actually expended from the Treasury and could be the result of either new budget authority enacted in the current fiscal year or unexpended budget authority that was enacted in previous fiscal years. As a consequence, the BA and outlays in this table represent two different ways of accounting for the funding that is provided to each HHS agency through the federal budget process.

Administration for Children and Families (ACF)

The ACF mission is focused on promoting the "economic and social well-being of children, youth, families, and communities." ACF administers a wide array of human services programs, including Temporary Assistance for Needy Families (TANF), Head Start, child care, the Social Services Block Grant (SSBG), and various child welfare programs.

Relevant Appropriations Bill:

LHHS

FY201 8 Request:

BA: $46.535 billion Outlays: $48.289 billion

Additional Resources Related to the FY201 8 Request:

Congressional Justification, available at https://www.acf.hhs.gov/sites/default/files/olab/acf_master_cj_508_compmay_21_2017.pdf . All-Purpose Table (p. 6), available at https://www.acf.hhs.gov/sites/default/files/olab/acf_master_cj_508_compmay_21_2017.pdf#page=11 . BIB Chapter (p. 74), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=78 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=397 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=43 .

Administration for Community Living (ACL)

The ACL mission is focused on maximizing the "independence, well-being, and health of older adults, people with disabilities across the lifespan, and their families and caregivers." ACL administers a number of programs targeted at older Americans and the disabled, including Home and Community-Based Supportive Services and State Councils on Developmental Disabilities.

Relevant Appropriations Bill:

LHHS

FY2018 Request:

BA: $1.851 billion Outlays: $1.935 billion

Additional Resources Related to the FY2018 Request:

Congressional Justification, https://www.acl.gov/sites/default/files/about-acl/2017-05/FY%202018%20ACL%20Budget%20Congressional%20Justification%20v2.pdf . All-Purpose Table (p. 13), available at https://www.acl.gov/sites/default/files/about-acl/2017-05/FY%202018%20ACL%20Budget%20Congressional%20Justification%20v2.pdf#page=18 . BIB Chapter (p. 85), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=89 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=400 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=49 .

Agency for Healthcare Research and Quality (AHRQ)

The AHRQ mission is focused on research to make health care "safer, higher quality, more accessible, equitable, and affordable." Specific AHRQ research efforts are aimed at reducing the costs of care, promoting patient safety, measuring the quality of health care, and improving health care services, organization, and financing. The FY2018 President's budget proposes consolidating AHRQ's functions within NIH, in the new National Institute for Research on Safety and Quality (NIRSQ). Consequently, the FY2018 budget documents provided below reference the NIRSQ, and not AHRQ.

Relevant Appropriations Bill:

LHHS

FY2018 Request:

BA: $0 million Outlays: $288 million

Additional Resources Related to the FY2018 Request:

Congressional Justification, available at https://www.ahrq.gov/sites/default/files/wysiwyg/cpi/about/mission/budget/2018/NIRSQ.pdf . All-Purpose Table (p. 4), available at https://www.ahrq.gov/sites/default/files/wysiwyg/cpi/about/mission/budget/2018/NIRSQ.pdf#page=4 . BIB Chapter: There is no FY2018 BIB chapter for AHRQ.

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=395 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=40 .

Centers for Disease Control and Prevention (CDC) and Agency for Toxic Substances and Disease Registry (ATSDR)19

The CDC mission is focused on "disease prevention and control, environmental health, and health promotion and health education." CDC is organized into a number of centers, institutes, and offices, some focused on specific public health challenges (e.g., injury prevention), and others focused on general public health capabilities (e.g., surveillance and laboratory services).

In addition, the Agency for Toxic Substances and Disease Registry (ATSDR) is headed by the CDC director. For that reason, the ATSDR budget is often shown within CDC. Following the conventions of the FY2018 HHS Budget in Brief, ATSDR's budget request is included in the CDC totals shown in this report. ATSDR's work is focused on preventing or mitigating the adverse effects resulting from exposure to hazardous substances in the environment.

Relevant Appropriations Bills:

LHHS (CDC) INT (ATSDR)

FY2018 Request (CDC and ATSDR combined):

BA: $6.374 billion Outlays: $7.275 billion

Additional Resources Related to the FY2018 Request:

CDC Congressional Justification, available at https://www.cdc.gov/budget/documents/fy2018/fy-2018-cdc-congressional-justification.pdf . All-Purpose Table (p. 18), available at https://www.cdc.gov/budget/documents/fy2018/fy-2018-cdc-congressional-justification.pdf#page=18 . ATSDR Congressional Justification, available at https://www.cdc.gov/budget/documents/fy2018/fy-2018-atsdr.pdf . BIB Chapter (p. 28), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=32 .

Additional Resources Related to FY2017 Appropriations:

CDC appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=387 . CDC appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=31 . ATSDR appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=353 . ATSDR appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk2.pdf#page=611 .

Centers for Medicare & Medicaid Services (CMS)

The CMS mission is focused on ensuring "effective, up-to-date health care coverage and promot[ing] quality care for beneficiaries" of Medicare, Medicaid, the State Children's Health Insurance Program (CHIP), and new private insurance and private insurance market reform programs. The President's budget estimates that in FY2018, "over 143 million Americans will rely on programs CMS administers including Medicare, Medicaid, the Children's Health Insurance Program (CHIP), and the Health Insurance Exchanges."

Relevant Appropriations Bill:

LHHS

FY201 8 Request:

BA: $1,009.626 billion Outlays: $1,019.633 billion

Additional Resources Related to the FY201 8 Request:

Congressional Justification, available at https://www.cms.gov/About-CMS/Agency-Information/PerformanceBudget/Downloads/FY2018-CJ-Final.pdf . All-Purpose Table (p. 10), available at https://www.cms.gov/About-CMS/Agency-Information/PerformanceBudget/Downloads/FY2018-CJ-Final.pdf#page=16 . BIB Chapter (p. 49), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=53 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=395 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=41 .

Food and Drug Administration (FDA)

The FDA mission is focused on regulating the safety of human foods, dietary supplements, cosmetics, and animal foods; and the safety and effectiveness of human drugs, biological products (e.g., vaccines), medical devices, radiation-emitting products, and animal drugs. It also regulates the manufacture, marketing, and sale of tobacco products.

Relevant Appropriations Bill:

AG

FY2018 Request:

BA: $1.891 billion Outlays: $2.080 billion

Additional Resources Related to the FY2018 Request:

Congressional Justification, available at https://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/BudgetReports/UCM559923.pdf . All-Purpose Table (p. 9), available at https://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/BudgetReports/UCM559923.pdf#page=17 . BIB Chapter (p. 14), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=18 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=29 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk2.pdf#page=32 .

Health Resources and Services Administration (HRSA)

The HRSA mission is focused on "improving access to health care for those who are uninsured, isolated, or medically vulnerable." Among its many programs and activities, HRSA supports health care workforce training, the National Health Service Corps, and the federal health centers program, which provides grants to nonprofit entities that provide primary care services to people who experience financial, geographic, cultural, or other barriers to health care.

Relevant Appropriations Bill:

LHHS

FY2018 Request:

BA: $10.205 billion Outlays: $10.828 billion

Additional Resources Related to the FY2018 Request:

Congressional Justification, available at https://www.hrsa.gov/about/budget/budgetjustification2018.pdf . All-Purpose Table (p. 15), available at https://www.hrsa.gov/about/budget/budgetjustification2018.pdf#page=16 . BIB Chapter (p. 19), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=23 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=385 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=26 .

Indian Health Service (IHS)

The IHS mission is focused on providing "comprehensive health services for American Indians and Alaska Natives ... to improve their health status and overall quality of life." IHS provides health care for approximately 2.2 million eligible American Indians/Alaska Natives through a system of programs and facilities located on or near Indian reservations, and through contractors in certain urban areas.

Relevant Appropriations Bill:

INT

FY2018 Request:

BA: $4.898 billion Outlays: $4.939 billion

Additional Resources Related to the FY2018 Request:

Congressional Justification, available at https://www.ihs.gov/budgetformulation/includes/themes/newihstheme/display_objects/documents/FY2018CongressionalJustification.pdf . All-Purpose Table (p. 7), available at https://www.ihs.gov/budgetformulation/includes/themes/newihstheme/display_objects/documents/FY2018CongressionalJustification.pdf#page=17 . BIB Chapter (p. 25), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=29 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=350 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk2.pdf#page=609 .

National Institutes of Health (NIH)

The NIH mission is focused on supporting and conducting research "into the causes, diagnosis, treatment, control, and prevention of diseases" and promoting the "acquisition and dissemination of medical knowledge to health professionals and the public." NIH is organized into 27 research institutes and centers, headed by the NIH Director. In FY2018, the majority of the NIH budget (over 80%) will support research performed by more than 300,000 researchers who work at more than 2,500 universities, medical schools, and other research institutions.

Relevant Appropriations Bill:

LHHS

FY2018 Request:

BA: $26.049 billion Outlays: $30.195 billion

Additional Resources Related to the FY2018 Request:

Congressional Justification, available at https://officeofbudget.od.nih.gov/pdfs/FY18/NIH%20Overview%20Volume%20Final.pdf . All-Purpose Table (p. 16), https://officeofbudget.od.nih.gov/pdfs/FY18/NIH%20Overview%20Volume%20Final.pdf#page=20 . BIB Chapter (p. 36), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=40 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=390 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=34 .

Substance Abuse and Mental Health Services Administration (SAMHSA)

The SAMHSA mission is focused on reducing the "impact of substance abuse and mental illness on America's communities." SAMHSA coordinates behavioral health surveillance to better understand the impact of substance abuse and mental illness on children, individuals, and families, and the costs associated with treatment.

Relevant Appropriations Bill:

LHHS

FY2018 Request:

BA: $3.771 billion Outlays: $3.688 billion

Additional Resources Related to the FY2018 Request:

Congressional Justification, available at https://www.samhsa.gov/sites/default/files/samhsa-fy-2018-congressional-justification.pdf . All-Purpose Table (p. 6), available at https://www.samhsa.gov/sites/default/files/samhsa-fy-2018-congressional-justification.pdf#page=14 . BIB Chapter (p. 48), available at https://www.hhs.gov/sites/default/files/Consolidated%20BIB_ONLINE_remediated.pdf#page=44 .

Additional Resources Related to FY2017 Appropriations:

Appropriations language ( P.L. 115-31 ), available at https://www.congress.gov/115/bills/hr244/BILLS-115hr244enr.pdf#page=393 . Appropriations funding table (explanatory statement), available at https://www.congress.gov/crec/2017/05/03/CREC-2017-05-03-bk3.pdf#page=37 .