President Biden Releases Initial Fiscal Year 2022 Budget Proposal: Will Congress listen?

Last Friday, the Biden Administration released a portion of its fiscal year (FY) 2022 “President’s Budget.” The President’s Budget, released each year, outlines the administration’s budget and policy priorities for the next fiscal year. On a personal note, I worked on eight President’s Budgets during my tenure at the U.S. Department of Health and Human Service’s (HHS’s) Budget Office—so I definitely appreciate the work that goes into the President’s Budget submission.

Since the administration is still getting up and going, only the “discretionary” section of the President’s Budget was actually released. The discretionary budget includes funding requests for agencies, initiatives, and programs across the government that are subject to Congress’ annual appropriations process. In other words, it is up to Congress each year to ultimately fund these agencies— and the President’s Budget merely represents suggested funding levels. The other part of the President’s Budget that was not released (but is expected next month) is the “mandatory” budget request. To me, the mandatory budget proposals are equally or even more significant than the discretionary budget requests, since they reflect the administration’s policy positions on programs already established and funded in law (such as entitlements), which make up the majority of federal spending. For example, previous administrations have used the President Budget as an opportunity to introduce large scale reforms (or medium-sized modifications) to the Medicare and Medicaid programs and the federal Marketplace that was established by the Affordable Care Act. However, like the discretionary budget, it is up to Congress to adopt any of the mandatory budget proposals that are put forth.

While the discretionary section of the President’s Budget includes hundreds of requests for programs in nearly all federal agencies, I want to highlight a few from the HHS request.

Overall, the administration is requesting a funding level for HHS in FY 2022 of $131.7 billion, which is a $25 billion, or 23.5-percent, increase over the current FY 2021 level. The HHS budget request focuses on some major themes, such as building upon “investments already made to respond to the COVID-19 pandemic by prioritizing investments to prepare for future public health emergencies,” addressing the opioid crisis, expanding biomedical capabilities, and promoting health and social service equity. Major funding requests include:

• Centers for Disease Control and Prevention (CDC): The discretionary request includes $8.7 billion for CDC, an increase of $1.6 billion over the 2021 level. This would be the largest budget increase for CDC in nearly 20 years. The administration believes that such an increase is “needed to restore capacity to the world’s preeminent public health agency.”
• Office of the Assistant Secretary for Preparedness and Response (ASPR) and the Food and Drug Administration (FDA): The discretionary request proposes $905 million for ASPR’s Strategic National Stockpile (SNS) “to maintain replenishment of critical medical supplies and restructuring efforts initiated during the COVID-19 pandemic.”
• National Institutes of Health (NIH): The discretionary request includes $51 billion for the NIH, a $9 billion increase over the 2021 level, “to continue to support research that enhances health, lengthens life, and reduces illness and ”
• Opioid Crisis: The discretionary request provides an investment of $10.7 billion, an increase of $3.9 billion over the 2021 level, to “help end the opioid crisis, including funding for States and Tribes, medication-assisted treatment, research, and expanding the behavioral health provider workforce.”
• Mental Health Treatment: The discretionary request provides $1.6 billion, more than double the 2021 level, for the Community Mental Health Services Block Grant. It also “supports the particular needs of those who are involved in the criminal justice system, provides funding for partnerships between mental health providers and law enforcement, and expands suicide prevention activities.”
• Addressing Racial Disparities: The discretionary request provides additional funding to “increase the diversity of the healthcare workforce and expand access to culturally competent ” The request also includes $153 million for CDC’s Social Determinants of Health program to support all states and territories in “improving health equity and data collection for racial and ethnic populations.”
• Gun Violence Research: The discretionary request doubles funding for firearm violence prevention research at CDC and NIH and includes $100 million for CDC to start a new Community- Based Violence Intervention initiative.
• Family Planning Healthcare Services: The discretionary request provides $340 million, an increase of 18.7 percent, to the Title X Family Planning
• Rural Healthcare Access: The discretionary request “prioritizes investments in programs that help rural communities by providing access to quality healthcare and health professionals.”

Beyond HHS, it is also important to note that the administration proposes a significant increase in funding for the Department of Veterans Affairs (VA), targeting some of the increase at improving VA medical care, expanding veteran suicide prevention outreach, and modernizing VA information technology systems.

I highly doubt that Congress will actually wind up funding many of these agencies at the high (or in some cases, extremely high) levels included in this budget request. However, I still think the President Budget is a useful exercise for each administration to go through as, again, it gives the administration an opportunity to clearly lay out its top priorities. I’m also eager to see what proposals will be included in the mandatory budget when its released. Will the Biden Administration propose any structural reforms to Medicare (such as lowering the eligibility age) or changes to the private insurance market (such as adding a public option to the federal Marketplace)? Only time will tell!

Until next week, this is Jeffrey saying, enjoy reading regs with your eggs.