Untreated HIV infection leads to a gradual deterioration of the immune system and leavesaffected individuals susceptible to the opportunistic infections and cancers that typify AIDS. Since1981, a cumulative total of 1,014,797 AIDS cases in the United States and dependent areas havebeen reported to the Centers for Disease Control and Prevention (CDC). (1) Of this total, 448,871 personswere reported to be living with AIDS as of the end of December 2006. In addition to the totalnumber of people living with AIDS, another 233,079 persons were known to be infected with HIV(does not include data from five states and the District of Columbia; these areas have not beenreporting name-based HIV infection case numbers to CDC since at least 2003). Figure 1. Estimated Total Federal Spending on HIV/AIDS,by Function, FY2008 Source: HHS Budget Office, March 20, 2008. Federal government AIDS spending is estimated at $23.3 billion in FY2008 (see Table 5 ). The Bush Administration request for FY2009 is $24.1 billion. Of the total amount spent by thefederal government on HIV/AIDS in FY2008, the majority (63%) of funding is for treatmentprograms; funding for research receives 13% of the total (see Figure 1 and Table 4 ). The remainingamounts are for prevention programs (14%) and income support for persons with AIDS (10%). AIDS programs within HHS (Health and Human Services) account for 66% of the totalamount spent on AIDS by the federal government (see Figure 2 ). HHS entitlement funding supportsthe treatment of HIV/AIDS patients through Medicaid and Medicare, which are administered by theCenters for Medicare and Medicaid Services (CMS). HHS discretionary funding supports AIDSresearch and prevention programs, as well as treatment programs. Table 2 provides a history ofHHS discretionary funding for HIV/AIDS from the beginning of the epidemic in FY1981 to thepresent. Funding for HIV/AIDS programs within HHS has increased markedly over the past 15 yearsas measured in constant 2000 dollars, shown in Figure 4 near the end of this report. Even thoughHHS has revised its estimates of spending by Medicaid for FY2007 through FY2009, Figure 4 stillshows that most of the overall rise can be attributed to increased spending on Medicaid, Medicare,and treatment programs in the discretionary budget, largely through the Ryan White programadministered by the Health Resources and Services Administration (HRSA). The increase inHIV/AIDS research and prevention programs has been much less pronounced, and their portion ofthe total amount spent by HHS on HIV/AIDS has declined over the past 15 years (see Figure 5 ). For example, in FY1992 HIV/AIDS research and prevention programs at HHS accounted for 51%of the total amount spent by HHS on HIV/AIDS; by FY2008, such programs were about 27% of thetotal amount spent by HHS on HIV/AIDS, reflecting the growing amounts spent on treatmentservices under Medicaid and Medicare. Figure 2. Estimated Total Federal Spending on HIV/AIDS, byAgency, FY2008 Source: HHS Budget Office, March 20, 2008. Note: USAID, U.S. Agency for International Development. See Table 4 . About 90% of FY2008 HHS discretionary funding for HIV/AIDS is allocated to three HHSagencies: the National Institutes of Health (NIH), which supports HIV/AIDS research ; CDC, whichsupports HIV/AIDS prevention programs; and, HRSA, which administers the Ryan White program,an HIV/AIDS treatment program (see Table 3 and Table 4 ). The budgets and activities of thesethree agencies are briefly described below, followed by a discussion of entitlement program spendingon HIV/AIDS. NIH is the principal agency of the federal government charged with the conduct and supportof biomedical and behavioral research. NIH conducts research at its own 27 institutes and centersand supports more than 200,000 scientists and research personnel working at over 3,100 U.S.institutions. NIH funding for FY2008 was provided in P.L. 110-161 ( H.R. 2764 ), andNIH estimates FY2008 funding for AIDS research at $2.913 billion. The Administration's requestfor FY2009 is $2.913 billion. (2) Funding for AIDS research is distributed among the NIH institutesin accordance with the scientific priorities identified in the annual comprehensive plan for AIDSresearch developed by the institutes along with the Office of AIDS Research (OAR). OAR was established in statute by the National Institutes of Health Revitalization Act of1993 ( P.L. 103-43 ) and given substantially enhanced authority and responsibility beyond the officeNIH had established under the same name. Congress appropriated funds to OAR in FY1995. However, since FY1996, Congress has not provided a direct appropriation for the OAR (aside fromamounts identified for the operations of the office itself). For FY2008, the House and Senate do notspecify a funding amount for AIDS research at NIH. Instead, funding for AIDS research is includedwithin the appropriation for each Institute/Center/Division of NIH, with decisions as to specificprojects to fund and levels of funding left to the Director of NIH and the Director of OAR. CDC works with community, state, national, and international public health agencies toprevent HIV infection and reduce AIDS-associated morbidity and mortality through its informationand education programs. CDC also supports research, surveillance, and epidemiology studies onHIV/AIDS. CDC distributes much of its HIV funds to state and local agencies through cooperativeagreements, grants, and contracts. CDC funding for FY2008 was provided in P.L. 110-161 ( H.R. 2764 ). According to the HHS Budget Office, CDC will be spending $872 millionon HIV/AIDS activities in FY2008; the Administration's request for FY2009 is $871 million. (3) The HIV/AIDS Bureau within HRSA administers the Ryan White program, a four-partfederal grant program designed to provide emergency relief and essential health care services topatients infected with HIV. The program funds hundreds of grantees that serve 531,000 people eachyear. The Ryan White HIV/AIDS Treatment Modernization Act of 2006 ( P.L. 109-415 , H.R. 6143 ) reauthorized the Ryan White program through September 30, 2009. HRSA funding for FY2007 was provided in P.L. 110-161 ( H.R. 2764 ). According to the HHS Budget Office, HRSA will be spending $2.170 billion on Ryan Whiteprogram activities in FY2008. The Administration's request for FY2009 is $2.171 billion. (4) (For further information onthe Ryan White program, see CRS Report RL33279 , The Ryan White HIV/AIDS Program , by JudithA. Johnson.) Medicaid is a federal-state matching entitlement program that provides medical assistancefor eligible low-income persons and families and certain aged, disabled, and medically needyindividuals. In order to obtain Medicaid coverage, persons must belong to one of the categories ofpersons who can qualify for coverage (such as families with children and disabled persons) and havelow income or deplete their income on the cost of their care. Medicaid has played an important rolein needed health care for persons with HIV and AIDS because of its coverage of prescription drugs. Within broad federal guidelines, each state designs and administers its own Medicaidprogram, resulting in wide variations among the states in coverage, benefits offered, and paymentfor services. The portion of a state's Medicaid budget provided by the federal government variesfrom 50% in relatively affluent states to 80% in poorer states. Medicaid is one of the largest sourceof federal funding for AIDS treatment and health care services (see Figure 3 ). For FY2008, the federal share of Medicaid spending on AIDS treatment is estimated at $4.1billion, and for FY2009, the federal share estimate is $4.4 billion. Total FY2008 federal and stateMedicaid spending for AIDS treatment will be an estimated $7.2 billion ($4.1 billion federal and$3.1 billion state). (5) CMSanalysts have significantly lowered their estimate of the federal share of Medicaid spending on AIDStreatment due to two factors: (1) the impact of Medicare Part D prescription drug coverage and (2)lowered per capita health care costs based on internal CMS data and external data. (6) However, a study by analystsoutside of CMS found that although "implementation of Medicare drug benefit resulted in a majorshift of prescription drug spending from Medicaid to Medicare ... spending for antiretroviralmedications decreased by a much smaller percentage than did spending for many other classes.People with HIV and AIDS continue to depend heavily on Medicaid to pay for their health care, asmost do not qualify for Medicare." (7) Figure 3. Estimated Federal Government Spending on HIV/AIDSTreatment, FY2008 Source: HHS Budget Office, March 20, 2008. Notes: Other includes the following: Substance Abuse and Mental Health; Public Health EmergencyFund; Department of Defense; Bureau of Prisons; Federal Employee Health Benefits Program;Global AIDS Trust Fund. See Table 3 . Medicare is a federal health care insurance program for the elderly and certain disabledpersons. In general, in order to qualify for coverage under Medicare, a person must be age 65 orolder, disabled, or suffering from kidney failure (end-stage renal disease or ESRD). According toone estimate, about 80% of beneficiaries with HIV/AIDS that qualified for Medicare did so becauseof a disability, (8) theremainder were eligible because they were 65 or older or had ESRD. (9) The elderly qualify the monththey turn 65, and those with ESRD qualify within three months of being diagnosed with irreversiblekidney disease requiring dialysis or a kidney transplant.