Limits...
Challenges in defining an optimal approach to formula-based allocations of public health funds in the United States.

Buehler JW, Holtgrave DR - BMC Public Health (2007)

Bottom Line: Simplicity and transparency are major advantages of formula-based allocations, but these advantages can be offset if formula-based allocations are perceived to under- or over-fund some jurisdictions, which may result from how guaranteed minimum funding levels are set or from "hold-harmless" provisions intended to blunt the effects of changes in formula design or random variations in source data.Whether or how past or projected trends are taken into account can also have substantial impacts on allocations.In the meantime, those who use formula-based strategies to allocate funds should be familiar with the nuances of this approach.

View Article: PubMed Central - HTML - PubMed

Affiliation: Department of Epidemiology and Center for Public Health Preparedness and Research, Rollins School of Public Health, Emory University, Atlanta, Georgia, USA. jbuehle@sph.emory.edu

ABSTRACT

Background: Controversy and debate can arise whenever public health agencies determine how program funds should be allocated among constituent jurisdictions. Two common strategies for making such allocations are expert review of competitive applications and the use of funding formulas. Despite widespread use of funding formulas by public health agencies in the United States, formula allocation strategies in public health have been subject to relatively little formal scrutiny, with the notable exception of the attention focused on formula funding of HIV care programs. To inform debates and deliberations in the selection of a formula-based approach, we summarize key challenges to formula-based funding, based on prior reviews of federal programs in the United States.

Discussion: The primary challenge lies in identifying data sources and formula calculation methods that both reflect and serve program objectives, with or without adjustments for variations in the cost of delivering services, the availability of local resources, capacity, or performance. Simplicity and transparency are major advantages of formula-based allocations, but these advantages can be offset if formula-based allocations are perceived to under- or over-fund some jurisdictions, which may result from how guaranteed minimum funding levels are set or from "hold-harmless" provisions intended to blunt the effects of changes in formula design or random variations in source data. While fairness is considered an advantage of formula-based allocations, the design of a formula may implicitly reflect unquestioned values concerning equity versus equivalence in setting funding policies. Whether or how past or projected trends are taken into account can also have substantial impacts on allocations.

Summary: Insufficient attention has been focused on how the approach to designing funding formulas in public health should differ for treatment or service versus prevention programs. Further evaluations of formula-based versus competitive allocation methods are needed to promote the optimal use of public health funds. In the meantime, those who use formula-based strategies to allocate funds should be familiar with the nuances of this approach.

Show MeSH

Related in: MedlinePlus

a – AIDS cases by date of report, United States, 1984–1993 Legend: Number of AIDS cases by quarter year of report, United States, 1984–1993. AIDS surveillance criteria were modified in 1987[*] and 1993[†]). Source: Centers for Disease Control and Prevention.[15] b – AIDS cases by date of diagnosis, United States, 1986-1993 Estimated AIDS-opportunistic illness incidence (represents an estimate of AIDS trends if the surveillance definition had not been revised in 1993), adjusted for delays in reporting, by quarter year of diagnosis, United States, 1986-1993. Source: Centers for Disease Control and Prevention.[17]
© Copyright Policy - open-access
Related In: Results  -  Collection

License
getmorefigures.php?uid=PMC1851708&req=5

Figure 1: a – AIDS cases by date of report, United States, 1984–1993 Legend: Number of AIDS cases by quarter year of report, United States, 1984–1993. AIDS surveillance criteria were modified in 1987[*] and 1993[†]). Source: Centers for Disease Control and Prevention.[15] b – AIDS cases by date of diagnosis, United States, 1986-1993 Estimated AIDS-opportunistic illness incidence (represents an estimate of AIDS trends if the surveillance definition had not been revised in 1993), adjusted for delays in reporting, by quarter year of diagnosis, United States, 1986-1993. Source: Centers for Disease Control and Prevention.[17]

Mentions: The use of AIDS surveillance data in the Ryan White formula provides an example of the way that funding formulas can affect source data. On January 1,1993, CDC implemented an expansion of AIDS surveillance criteria. This change had been deliberated for several years, and states anticipated its implementation. As a result, there was a huge spike in reported AIDS cases in early 1993, when examined by date cases were reported [16], which reflected the effect of the definition change and reporting incentives of the Ryan White program, not underlying trends in the epidemic (Figure 1a). This also led CDC to implement complex statistical adjustments to describe trends in AIDS by date of diagnosis had the definition not changed (Figure 1b) [16,17]. Lastly, the shift from cumulative numbers of AIDS reports, which included people who had died, to numbers of people living with AIDS [4], required consideration of the potential impact on the reporting of AIDS deaths. AIDS case reporting typically occurs in multiple steps, including an initial report followed by updates as additional information becomes available about subsequent opportunistic illnesses or death. A funding formula based on numbers of people living with AIDS could be a disincentive for states to assure that deaths are ascertained and reports updated. CDC averted this potential effect by using a national-level estimate of AIDS death rates and applying that estimate to all state AIDS reports [18].


Challenges in defining an optimal approach to formula-based allocations of public health funds in the United States.

Buehler JW, Holtgrave DR - BMC Public Health (2007)

a – AIDS cases by date of report, United States, 1984–1993 Legend: Number of AIDS cases by quarter year of report, United States, 1984–1993. AIDS surveillance criteria were modified in 1987[*] and 1993[†]). Source: Centers for Disease Control and Prevention.[15] b – AIDS cases by date of diagnosis, United States, 1986-1993 Estimated AIDS-opportunistic illness incidence (represents an estimate of AIDS trends if the surveillance definition had not been revised in 1993), adjusted for delays in reporting, by quarter year of diagnosis, United States, 1986-1993. Source: Centers for Disease Control and Prevention.[17]
© Copyright Policy - open-access
Related In: Results  -  Collection

License
Show All Figures
getmorefigures.php?uid=PMC1851708&req=5

Figure 1: a – AIDS cases by date of report, United States, 1984–1993 Legend: Number of AIDS cases by quarter year of report, United States, 1984–1993. AIDS surveillance criteria were modified in 1987[*] and 1993[†]). Source: Centers for Disease Control and Prevention.[15] b – AIDS cases by date of diagnosis, United States, 1986-1993 Estimated AIDS-opportunistic illness incidence (represents an estimate of AIDS trends if the surveillance definition had not been revised in 1993), adjusted for delays in reporting, by quarter year of diagnosis, United States, 1986-1993. Source: Centers for Disease Control and Prevention.[17]
Mentions: The use of AIDS surveillance data in the Ryan White formula provides an example of the way that funding formulas can affect source data. On January 1,1993, CDC implemented an expansion of AIDS surveillance criteria. This change had been deliberated for several years, and states anticipated its implementation. As a result, there was a huge spike in reported AIDS cases in early 1993, when examined by date cases were reported [16], which reflected the effect of the definition change and reporting incentives of the Ryan White program, not underlying trends in the epidemic (Figure 1a). This also led CDC to implement complex statistical adjustments to describe trends in AIDS by date of diagnosis had the definition not changed (Figure 1b) [16,17]. Lastly, the shift from cumulative numbers of AIDS reports, which included people who had died, to numbers of people living with AIDS [4], required consideration of the potential impact on the reporting of AIDS deaths. AIDS case reporting typically occurs in multiple steps, including an initial report followed by updates as additional information becomes available about subsequent opportunistic illnesses or death. A funding formula based on numbers of people living with AIDS could be a disincentive for states to assure that deaths are ascertained and reports updated. CDC averted this potential effect by using a national-level estimate of AIDS death rates and applying that estimate to all state AIDS reports [18].

Bottom Line: Simplicity and transparency are major advantages of formula-based allocations, but these advantages can be offset if formula-based allocations are perceived to under- or over-fund some jurisdictions, which may result from how guaranteed minimum funding levels are set or from "hold-harmless" provisions intended to blunt the effects of changes in formula design or random variations in source data.Whether or how past or projected trends are taken into account can also have substantial impacts on allocations.In the meantime, those who use formula-based strategies to allocate funds should be familiar with the nuances of this approach.

View Article: PubMed Central - HTML - PubMed

Affiliation: Department of Epidemiology and Center for Public Health Preparedness and Research, Rollins School of Public Health, Emory University, Atlanta, Georgia, USA. jbuehle@sph.emory.edu

ABSTRACT

Background: Controversy and debate can arise whenever public health agencies determine how program funds should be allocated among constituent jurisdictions. Two common strategies for making such allocations are expert review of competitive applications and the use of funding formulas. Despite widespread use of funding formulas by public health agencies in the United States, formula allocation strategies in public health have been subject to relatively little formal scrutiny, with the notable exception of the attention focused on formula funding of HIV care programs. To inform debates and deliberations in the selection of a formula-based approach, we summarize key challenges to formula-based funding, based on prior reviews of federal programs in the United States.

Discussion: The primary challenge lies in identifying data sources and formula calculation methods that both reflect and serve program objectives, with or without adjustments for variations in the cost of delivering services, the availability of local resources, capacity, or performance. Simplicity and transparency are major advantages of formula-based allocations, but these advantages can be offset if formula-based allocations are perceived to under- or over-fund some jurisdictions, which may result from how guaranteed minimum funding levels are set or from "hold-harmless" provisions intended to blunt the effects of changes in formula design or random variations in source data. While fairness is considered an advantage of formula-based allocations, the design of a formula may implicitly reflect unquestioned values concerning equity versus equivalence in setting funding policies. Whether or how past or projected trends are taken into account can also have substantial impacts on allocations.

Summary: Insufficient attention has been focused on how the approach to designing funding formulas in public health should differ for treatment or service versus prevention programs. Further evaluations of formula-based versus competitive allocation methods are needed to promote the optimal use of public health funds. In the meantime, those who use formula-based strategies to allocate funds should be familiar with the nuances of this approach.

Show MeSH
Related in: MedlinePlus