Contents

• About HHS
• Overview of the FY2017 HHS Budget Request
• Budgetary Resources vs. Appropriations
• HHS Budget by Operating Division
• Administration for Children and Families (ACF)
• Administration for Community Living (ACL)
• Agency for Healthcare Research and Quality (AHRQ)
• Centers for Disease Control and Prevention (CDC) & Agency for Toxic Substances and Disease Registry (ATSDR)
• Centers for Medicare & Medicaid Services (CMS)
• Food and Drug Administration (FDA)
• Health Resources and Services Administration (HRSA)
• Indian Health Service (IHS)
• National Institutes of Health (NIH)
• Substance Abuse and Mental Health Services Administration (SAMHSA)

Summary

This report provides information about the FY2017 budget request for the Department of Health and Human Services (HHS). It begins by reviewing the department's mission and structure. This is followed by an overview of the total FY2017 request for the department. Next, the report discusses the concept of the HHS budget as a whole, compared to funding provided to HHS through the annual appropriations process. This distinction is important because certain amounts shown in FY2017 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) because they take into account a broader set of budgetary resources. The report concludes with a breakdown of the HHS request by agency, along with additional HHS resources that provide further information on the request. A table of key policy staff is included at the end of the report.

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Department of Health and Human Services: FY2017 Budget Request

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."¹ HHS is 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 glossary 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).²

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 FY2017 HHS Budget Request

On February 9, 2016, the Obama Administration released its FY2017 budget request. Under this proposal, HHS would spend an estimated $1.145 trillion in outlays³ in FY2017 (see Table 1).⁴ This represents an increase of $34 billion (+3%) from FY2016. The Office of Management and Budget (OMB) estimates that HHS will account for more than a quarter of all federal outlays (nearly 28%) in FY2017.⁵ HHS has accounted for at least 20% of all federal outlays in each year since FY1995.⁶

Figure 1 displays proposed FY2017 HHS outlays by major program or spending category in the President's request. As this figure shows, mandatory spending⁷ typically accounts for the vast majority of the HHS budget. In fact, two programs—Medicare and Medicaid—are expected to account for 86% of all estimated HHS spending in FY2017. 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.⁸

This figure also shows that discretionary spending accounts for only about 8% of FY2017 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 FY2017 (51%) would go to the Department of Defense. However, HHS would receive the next largest share (nearly 7%) of all discretionary budget authority requested by the President, followed by the Department of Veterans Affairs and the Department of Education.⁹

Figure 1. Proposed FY2017 HHS Outlays by Major Program and Spending Category Total Outlays: $1.145 Trillion

Source: Prepared by the Congressional Research Service (CRS) based on data presented on p. 1 and p. 18 of the HHS FY2017 Budget in Brief, available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf. Notes: For mandatory spending, outlays reflect proposed law spending levels, not the current services baseline.

Budgetary Resources vs. 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 FY2017 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 accounts for 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 breaks up 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 FY2017: proposed law and current law. Proposed law estimates take into account changes in mandatory spending proposed in the FY2017 HHS budget request. Such proposals would need to be enacted into law to affect the budgetary resources ultimately available to the mandatory spending program.¹⁰ 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).¹¹ 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 FY2017 Budget in Brief (BIB).¹²

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 FY2015, FY2016, and FY2017 figures are taken from the HHS BIB for FY2017; the FY2014 figures are taken from the FY2016 BIB.¹³

The remainder of this section provides a brief summary of the mission of each operating division, the FY2017 budget request, and links to additional resources related to that request. 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 families, children, individuals, and communities."¹⁴ 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

FY2017 Request:

• BA: $63.005 billion (+$9.864 billion compared to FY2016)
• Outlays: $58.266 billion (+$5.491 billion compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at https://www.acf.hhs.gov/sites/default/files/olab/final_cj_2017_print.pdf.
• All-Purpose Table (p. 14), available at https://www.acf.hhs.gov/sites/default/files/olab/final_cj_2017_print.pdf#page=19.
• BIB Chapter (p. 131), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page-135.

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 life span, and their families and caregivers."¹⁵ 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

FY2017 Request:

• BA: $1.969 billion (+$30 million compared to FY2016)
• Outlays: $1.929 billion (-$279 million compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at http://www.acl.gov/About_ACL/Budget/docs/FY_2017_ACL_CJ.pdf.
• All-Purpose Table (p. 17), available at http://www.acl.gov/About_ACL/Budget/docs/FY_2017_ACL_CJ.pdf#page=25.
• BIB Chapter (p. 151), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=155.

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."¹⁶ 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.

Relevant Appropriations Bill:

• LHHS

FY2017 Request:

• BA: $280 million (-$54 million compared to FY2016)
• Outlays: $394 million (+$199 million compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at http://www.ahrq.gov/sites/default/files/wysiwyg/cpi/about/mission/budget/2017/cj2017.pdf.
• All-Purpose Table (p. 7), available at http://www.ahrq.gov/sites/default/files/wysiwyg/cpi/about/mission/budget/2017/cj2017.pdf#page=13.
• BIB Chapter (p. 58), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=62.

Centers for Disease Control and Prevention (CDC) & Agency for Toxic Substances and Disease Registry (ATSDR)¹⁷

The CDC mission is focused on "disease prevention and control, environmental health, and health promotion and health education."¹⁸ 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 FY2017 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)

FY2017 Request (CDC and ATSDR combined):

• BA: $7.455 billion (-$203 million compared to FY2016)
• Outlays: $7.877 billion (+$635 million compared to FY2016)

Additional Resources Related to the FY2017 Request:

• CDC Congressional Justification, available at http://www.cdc.gov/budget/documents/fy2017/fy-2017-cdc-congressional-justification.pdf.
• All-Purpose Table (p. 24), available at http://www.cdc.gov/budget/documents/fy2017/fy-2017-cdc-congressional-justification.pdf#page=24.
• ATSDR Congressional Justification, available at
  http://www.cdc.gov/budget/documents/fy2017/fy-2017-atsdr.pdf
• BIB Chapter (p. 37), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=41.

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.¹⁹ The President's budget estimates that roughly 125 million individuals will be enrolled in Medicare, Medicaid, and CHIP in FY2017.²⁰

Relevant Appropriations Bill:

• LHHS

FY2017 Request:

• BA: $1,019.936 billion (+$21.908 billion compared to FY2016)
• Outlays: $1,017.627 billion (+$25.096 billion compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at https://www.cms.gov/About-CMS/Agency-Information/PerformanceBudget/Downloads/FY2017-CJ-Final.pdf.
• All-Purpose Table (p. 10), available at http://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/BudgetReports/UCM485237.pdf#page=25.
• BIB Chapter (p. 63), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=67.

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.²¹

Relevant Appropriations Bill:

• AG

FY2017 Request:

• BA: $2.821 billion (+$91 million compared to FY2016)
• Outlays: $2.624 billion (+$161 compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at http://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/BudgetReports/UCM485237.pdf.
• All-Purpose Table (p. 17), available at http://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/BudgetReports/UCM485237.pdf#page=25.
• BIB Chapter (p. 19), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=23.

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."²² 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

FY2017 Request:

• BA: $10.866 billion (+$96 million compared to FY2016)
• Outlays: $11.537 billion (+$1.241 billion compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at http://www.hrsa.gov/about/budget/budgetjustification2017.pdf.
• All-Purpose Table (p. 17), available at http://www.hrsa.gov/about/budget/budgetjustification2017.pdf#page=17.
• BIB Chapter (p. 26), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=30.

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."²³ 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

FY2017 Request:

• BA: $5.368 billion (+$403 million compared to FY2016)
• Outlays: $5.260 billion (+$186 million compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at https://www.ihs.gov/budgetformulation/includes/themes/newihstheme/documents/FY2017CongressionalJustification.pdf.
• All-Purpose Table (p. 8), available at https://www.ihs.gov/budgetformulation/includes/themes/newihstheme/documents/FY2017CongressionalJustification.pdf#page=14.
• BIB Chapter (p. 32), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=36.

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." ²⁴ NIH is organized into 27 research institutes and centers, headed by the NIH Director. In FY2017, the majority of NIH budget (81%) will support research performed by more than 300,000 non-federal scientists and technical personnel who work at more than 2,500 universities, hospitals, medical schools, and other research institutions.²⁵

Relevant Appropriations Bill:

• LHHS

FY2017 Request:

• BA: $32.305 billion (+$758 million compared to FY2016)
• Outlays: $32.302 billion (+$2.081 million compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at https://officeofbudget.od.nih.gov/pdfs/FY17/31-Overview.pdf.
• All-Purpose Table (p. 3), available at https://officeofbudget.od.nih.gov/pdfs/FY17/31-Overview.pdf#page=7.
• BIB Chapter (p. 46), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=50.

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."²⁶ 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

FY2017 Request:

• BA: $4.107 billion (+$461 million compared to FY2016)
• Outlays: $3.701 billion (-$109 million compared to FY2016)

Additional Resources Related to the FY2017 Request:

• Congressional Justification, available at http://www.samhsa.gov/sites/default/files/samhsa-fy-2017-congressional-justification.pdf.
• All-Purpose Table (p. 17), available at http://www.samhsa.gov/sites/default/files/samhsa-fy-2017-congressional-justification.pdf#page=25.
• BIB Chapter (p. 52), available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf#page=56.

Author Contact Information

Acknowledgments

Ada Cornell, CRS Senior Research Librarian, assisted with the research for this report.

Key Policy Staff

Footnotes

1.	Introduction to the HHS Strategic Plan FY2014-FY2018, available at http://www.hhs.gov/about/strategic-plan/introduction/index.html#mission.
2.	For further information, see CRS Report R43304, Public Health Service Agencies: Overview and Funding (FY2010-FY2016), coordinated by [author name scrubbed] and [author name scrubbed].
3.	Budget authority is the amount of money a federal agency is legally authorized to commit or spend; an outlay occurs when funds are actually expended from the Treasury. These terms are discussed in the report section, "HHS Budget by Operating Division."
4.	This does not account for expected reductions to nonexempt mandatory spending due to budget sequestration. For further information, see Office of Management and Budget (OMB), OMB Report to the Congress on the Joint Committee Reductions for Fiscal Year 2017, February 9, 2016, available at https://www.whitehouse.gov/sites/default/files/omb/assets/legislative_reports/sequestration/jc_sequestration_report_2017_house.pdf.
5.	Ibid.
6.	OMB Historical Tables of the FY2017 President's Budget, Table 4.2, Percentage Distribution of Outlays by Agency: 1962–2021, available at https://www.whitehouse.gov/omb/budget/Historicals.
7.	The terms "mandatory spending" and "discretionary spending" are discussed in the report section, "Budgetary Resources vs. Appropriations."
8.	For more information on how these entitlement programs are financed, see CRS Report R41436, Medicare Financing, by [author name scrubbed].
9.	OMB Historical Tables of the FY2017 President's Budget, Table 5.5, Percentage Distribution of Discretionary Budget Authority by Agency: 1976–2021, available at https://www.whitehouse.gov/omb/budget/Historicals.
10.	For a list of all HHS legislative proposals for mandatory spending programs in FY2017 President's budget, see pp. 130-141 of Summary Table S-9 in OMB, Budget of the United States Government, Fiscal Year 2017, available at https://www.whitehouse.gov/sites/default/files/omb/budget/fy2017/assets/budget.pdf. This table lists mandatory proposals (but not discretionary proposals) by federal department and shows the estimated dollar change from current law levels should the proposal be enacted, and not the actual proposed funding level. For additional information, see the applicable operating division chapters of the HHS BIB or congressional justifications.
11.	For more information, see related discussion in the "Sources of PHS Agency Funding" section of CRS Report R43304, Public Health Service Agencies: Overview and Funding (FY2010-FY2016), coordinated by [author name scrubbed] and [author name scrubbed].
12.	The HHS FY2017 Budget in Brief is available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf (hereinafter FY2017 BIB).
13.	See "HHS Budget by Operating Division" in HHS FY2016 BIB, available at http://www.hhs.gov/about/budget/budget-in-brief/overview-tables/index.html, and "HHS Budget by Operating Division" in the FY2017 BIB, available at http://www.hhs.gov/sites/default/files/fy2017-budget-in-brief.pdf.
14.	ACF Chapter of the HHS FY2017 BIB.
15.	ACL Chapter of the FY2017 BIB.
16.	AHRQ Chapter of the FY2017 BIB.
17.	The figures for the CDC include funding for the Agency for Toxic Substances and Disease Registry (ATSDR). The congressional justification for ATSDR is available at http://www.cdc.gov/budget/documents/fy2017/fy-2017-atsdr.pdf.
18.	The CDC mission statement can be found on the CDC website at http://www.cdc.gov/maso/mab_Charts.htm.
19.	CMS Chapter of the FY2017 BIB.
20.	Department of Health and Human Services (HHS), Centers for Medicare & Medicaid Services: Fiscal Year 2016 Justification of Estimates for Appropriations Committees, February 9, 2016.
21.	CRS Report R43304, Public Health Service Agencies: Overview and Funding (FY2010-FY2016), coordinated by [author name scrubbed] and [author name scrubbed].
22.	HHS Strategic Plan FY2014-FY2018, Appendix B, available at http://www.hhs.gov/about/strategic-plan/appendix-b/index.html.
23.	Ibid.
24.	Ibid.
25.	NIH Chapter of the FY2017 BIB.
26.	SAMHSA Chapter in the FY2017 BIB.