The incredible shrinking Prevention Fund

April 19, 2013

Welcome to Health Reform Watch, Sarah Kliff’s regular look at how the Affordable Care Act is changing the American health-care system — and being changed by it. You can reach Sarah with questions, comments and suggestions here. Check back every Monday, Wednesday and Friday afternoon for the latest edition, and read previous columns here.

On Wednesday night, I had a dream.

I dreamt of a graph. A health policy graph, to be more specific. Yes, this really happened. No, I don't think I need to seek help — yet.

The graph that my subconscious came up with charted all the cuts to the Prevention and Public Health Fund. That's a $15 billion Obamacare program initially meant to — you guessed it — fund prevention and public health activities. This has included everything from training more primary-care doctors to supporting healthy corner stores.

The funds are not earmarked for any specific activity.  Instead, they get doled out each year. And that has made the Prevention Fund a prime target for legislators looking to pay for other health-care activities.

House Republicans want to use $4 billion in Prevention Fund dollars to continue the health law's high-risk pools. The administration announced this week that  it would use nearly half of the 2013 Prevention Fund dollars to build the federal health exchange.

With all those cuts to the Prevention Fund, I've had trouble keeping track of how much money is even left in the health law program. That's where a graph would come in handy — and the only thing better than dreaming about graphs is having a job where you make them.

The health law initially funded the Prevention Fund at $2 billion annually, with slightly smaller appropriations in the first few years as the program scaled up. This would be the only federal budget item dedicated to prevention and public health activities.

The deficit reduction package that passed in February 2012 cut $6.5 billion from the Prevention and Public Health Fund, leaving it with the budget you see above in green. The cut eliminated just over a third — 37 percent — of the Prevention Fund's budget.  Congress used these funds as part of a "doc-fix" package to keep Medicare provider payments stable.

Congressional gridlock has stopped Republican plans to eliminate the fund altogether from becoming law. But that doesn't mean it's safe: The Obama administration plans to use $454 million in Prevention Fund dollars to help pay for the federal health insurance exchange. That's 45 percent of the $1 billion in Prevention Fund spending available this year — and what's represented in the graph above, in yellow.

Much of this grows out of Congress' not approving funding to set up Obamacare. As a result, Health and Human Services Secretary Kathleen Sebelius has had to cobble together funds that her department already has.

Public health advocates haven't exactly been thrilled with this approach. While they support the health law's success, they argue that building a federal exchange isn't what the Prevention and Public Health Fund was meant to do.

"The diversion of funds is a disproportionately large burden," Trust for America's Health President Jeff Levi said in a statement late last week. "We should not be creating a competition between the potential gains from more people receiving insurance and more people taking part in preventive services." 

Why does the Prevention Fund prove a constant candidate to fund other programs? Researchers Rick Mayes and Thomas Oliver put forward a few possibilities in a recent paper on the subject. Much of it has to do with prevention being largely invisible. When it works best — when a case of diabetes or disease outbreak doesn't happen — you don't see it.

Mayes and Oliver call this the prevention paradox: “If public health measures are effective, the problems they are aimed at are often solved or never even materialize, thereby making them virtually invisible."

With the health insurance exchange, there will be a concrete project to point to in a number of months. With prevention work, though, that often does not exist — and can make such activities a tough sell on Capitol Hill.

KLIFF NOTES: Top health policy reads from around the web.

Families USA: 26 million Americans will qualify for tax credits next year. "As experts focus on the cost of requiring everybody to have health coverage next year, a new study highlights the broad reach of federal subsidies to help people pay for it. Nearly 26 million Americans will be eligible for tax credits under the Affordable Care Act to partly offset the cost of insurance in online state marketplaces, says Families USA, a consumer interest group that supports the health law." Jay Hancock in Kaiser Health News.

What to watch next on the Arkansas Medicaid expansion. "The TL;DR version is that a waiver actually gives Arkansas additional discretion in designing their expansion. What’s more (though this surely wasn’t a factor at play) it gives the rest of us front-row seats to watch the “private option” unfold." Adrianna McIntyre in Project Millennial.

Congressional Republicans want to add $4 billion to an Obamacare program. Wait, what? "The Energy and Commerce Committee passed a bill Wednesday to beef up funding for the health-care law’s high-risk insurance pools, which have stopped accepting new patients due to a lack of funding. The additional money for high-risk pools would come out of another part of the health-care law — its fund for prevention and public health, which Republicans decry as a "slush fund." Sam Baker in the Hill. 

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