Coming weeks and months will help to define how much money the federal government will allocate for a wide variety of purposes that affect health care and higher education both in calendar year 2021 and in the upcoming new fiscal year that begins next October 1. Spending occurs in three major ways.
Mandatory spending represents the largest share of the government’s budget. Amounts are not fixed and some money is directed to what are called entitlement programs, such as Medicare and Social Security. The key determinant is eligibility to participate in these programs. Once individuals are deemed eligible, the government is obliged to pay whatever costs are involved in meeting its obligations.
Expenditures that tend to merit the most attention in the mass media are called discretionary. They can vary in amounts from one year to the next and depend on agreements being reached on how much of a President’s proposed budget will be accepted by Congress. Oftentimes, amounts for the 12 major categories are not agreed upon for the start of a new fiscal year. Whenever that situation occurs, either short-term or long-term continuing resolutions known as CR’s enable the government to continue functioning uninterrupted. Sometimes, the final outcome is the enactment of omnibus legislation that encompasses several of the 12 appropriation bills.
A third important type of spending affects the academic community and it involves student financial support. One aspect pertains to student loans, a topic that regularly is addressed in this newsletter. Congress sets the terms regarding how much money will be dispersed to colleges and universities to benefit student borrowers. Current overall student debt is approximately $1.7 trillion. Many individuals find it extremely difficult to repay their loans. Policymakers often debate whether it is feasible to forgive a portion of this debt.
As reported on this page in the April 2021 issue of this newsletter, the Biden administration submitted a preliminary budget proposal to Congress on the 9th of that month for FY 2022. A more complete version was sent on May 22. Some of its main spending requests include:
$131.8 billion for Department of Health & Human Services (23.5% increase over FY 2021)
$51.9 billion for National Institutes of Health (21% increase over FY 2021)
$9.5 billion for Centers for Disease Control & Prevention (21.4% over FY 2021)
$7.8 billion for Health Resources & Services Administration (8.5% over FY 2021)
$854 million for HRSA’s Title VII Health Professions and Title VIII Nursing (12.1 % over FY 2021)