Question

The U.S. Public Health System continues to receive around 4% of the entire health care budget for our nation which is approximately $149 per person per year.

1. For your first substantive post, identify the current sources of funding for public health and how they are used at this point. In addition, consider the expansion of public health funding and what you would recommend using it for in our country. Support your recommendations with data.

Answer 1

Public Health Expenditures

= > Federal expenditures for public health make up a very small proportion of federal health-related funding. Annual federal public health expenditures average only 0.08 percent of Gross Domestic Product (GDP), 1.5 percent of federal health-related expenditures, and 0.5 percent of total healthrelated US public and private sector expenditures.1 The largest proportion of federal health expenditures supports the payment and provision of health care services.

= > Trends in federal expenditures for public health show variance in funding. Federal expenditures for public health often ebb and flow based upon emerging needs, such as increases in emergency preparedness funding following the 2001 terrorist attacks on September 11 or pandemic flu funding following H1N1.

= > Tracking state and local public health expenditures is complicated by differences in definitions about the scope of public health and the programs and services it includes.

Source of Funding for Public Health :

=> Public health faces significant challenges due to tightening budgets and unpredictable funding streams, and health departments have suffered significant cuts in the wake of the recent financial downturn. In fact, all seven case study health departments have seen their budgets reduced in recent years, in large part due to the economic downturn. While some of the most dramatic decreases came from diminished state revenue and reductions in tobacco Master Settlement Agreement allocations, federal funding has also decreased, including categorical funding and block grants. This shift has resulted in program reductions, program cuts, and layoffs—17% of non-clinical staff were laid off between 2008 and 2011 in one of the health departments.

=> Generally, state health departments have received the largest percentage of their revenue from federal sources, a smaller but significant percentage from state sources, and much smaller percentages from fees and fines and other sources. As state General Funds have diminished due to the recession, federal funding has become a larger percentage of health departments’ total revenue. For five of the health departments visited, the percentage of federal funding ranged from 57.5% to 74.7% of their total revenue. It is important to note that federal funding has not grown to make up for decreased state funding; in fact, federal funding has also decreased. However, federal funding has decreased at a slower rate than state funding and therefore has grown as a percentage of total public health revenue.

=> Health departments generally receive the largest percentage of their federal revenue from the U.S. Department of Agriculture (USDA), followed by the Centers for Disease Control and Prevention (CDC), the Health Resources and Services Administration (HRSA), the Environmental ProtectionAgency (EPA), the Food and Drug Administration (FDA), and finally the Department of Homeland Security (DHS). Some health departments reported receiving no funding from DHS.

=> State General Funds are an important source of revenue for state health departments, as they typically serve as a flexible source of funding. State health departments tended to use General Fund money to finance areas not covered by categorical funding streams (such as infrastructure activities and administrative costs), or to support programs whose costs were higher than their dedicated revenues.

Allocation of Public Health Funds :

=> Health departments reported on their expenditures for a variety of program areas, including: administration, improving consumer health, infectious disease, chronic disease, quality of health services, all hazards preparedness and response, environmental protection, health laboratory, health data, vital statistics, and injury prevention. We also asked health departments to report detailed financing information on their maternal and child health and tobacco programs.

=> There was considerable variation in funding for the same program areas across different state health departments. This variation was true even for the program areas that are traditional or key public health functions, such as infectious disease.

=> Programs and services offered by state and local health departments vary across jurisdictions in ways that can affect expenditures. For instance, unlike most states, the Massachusetts Department of Public Health operates the state’s five public hospitals, each of which has considerable administrative and workforce costs, thereby skewing per capita expenditure findings.

=> Allocation of funds can also depend on factors such as agency structure and workforce. For instance, the governmental public health system in Massachusetts consists of the state health department and 351 city and town-level autonomous local public health agencies. While some of these agencies, such as the Boston Public Health Commission, have a robust workforce and infrastructure, many operate on minimal or no funding, with a workforce as small as a single fulltime individual. Therefore, rather than rely on the local health departments (LHDs) to deliver certain key public health services such as WIC, the Massachusetts Department of Public Health has chosen to contract with a myriad of organizations to provide these services.

Expansion of Public Health Funding:

A part of these taxes can be used for expanding Public Health Care Funding.

1) Estate tax—a tax imposed on the transfer of the estate of a deceased person

2) Excise taxes—paid at the time of purchase of specific goods

3) Value–added tax—a form of consumption tax (common in other industrialized countries); similar to a sales tax but paid at all levels of production on the value added at each level

4) Sales taxes

5) Taxes on medical care, including a transaction tax on health care services and surcharges on health insurance (health care transaction tax)

6) Property tax

7) Big spenders’ or luxury goods taxes—higher taxes on items not considered essential or on purchases over a specified dollar amount

8) Industry taxes for externalities (for example, forcing market participants to pay the additional social costs of their products)

9) Tax on life insurance proceeds and other things that transfer at death (at state level)

10) Intangibles tax—a tax imposed by states or localities on the value of such assets as stocks, bonds, money market funds, and annuities

11) Hospital community benefit (recently updated Internal Revenue Service requirement that nonprofit hospitals use their tax exemption to return benefit to their communities)

12) Social investment bonds (SIBs)—a new tool through which government pays after results are achieved by collaborating public and private actors (including investors)

13) Community Development Financial Institutions (CDFIs)

Special mention : Emergency funds:

An emergency fund is a financial safety net for future mishaps and/or unexpected expenses.

In emergency situations like corona virus outbreak occurring now, emergency funds will be of great use.