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Budgetary Decision Making During Times of Scarcity

Jarris, Paul E. MD, MBA; Leider, Jonathon P. BA/BS; Resnick, Beth MPH; Sellers, Katie DrPH; Young, Jessica L. MS

Journal of Public Health Management and Practice: July/August 2012 - Volume 18 - Issue 4 - p 390–392
doi: 10.1097/PHH.0b013e31825b80fa
State of Public Health

This study presents select initial findings from a colaborative study with the Johns Hopkins Bloomberg School of Public Health that seeks to provide context and deeper understanding around issues of budget and priority-setting processes with qualitative and quantitative research.

The Association of State and Territorial Health Officials, Arlington, Virginia (Drs Jarris and Sellers). Department of Health Policy and Management, Johns Hopkins Bloomberg School of Public Health (Mr Leider, Ms Resnick and Ms Young).

Correspondence: Katie Sellers, DrPH, The Association of State and Territorial Health Officials, Arlington, VA 22202 (

The authors declare no conflicts of interest.

Public health is often defined by the sciences on which it is based (eg, epidemiology, tropical medicine, biostatistics) or the programs a health department operates. Far too often the critical role of the health official in garnering political support, financial resources, and public support is not recognized when defining the scope of our system.

Because most state health officials are political appointees, their work is sometimes considered to be separate from public health, as if politics and public health were distinct. But the state health official's interface with the political system and with the state budget office is critical to all aspects of public health. Without political support from the governor and financial support from the legislature, the public health agency cannot effectively protect and improve the health of the population.

As is reported at some length in this issue and the March issue of this journal, state and local health departments have seen major budget reductions over the past several years.1 4 However, to date there has not been much information regarding the context and decision-making processes around these budget cuts. This column presents select initial findings from a collaborative study with the Johns Hopkins Bloomberg School of Public Health that seeks to provide context and deeper understanding around issues of budget- and priority-setting processes, introduces components of a framework for budgetary decision making identified at the December 2011 ASTHO (Association of State and Territorial Health Officials) Winter Meeting, and links these ideas to the recently released Institute of Medicine (IOM) report For the Public's Health: Investing in a Healthier Future.1

The Johns Hopkins-ASTHO study consisted of both qualitative and quantitative research: semistructured interviews with leaders at 6 state health agencies (SHAs) and a Web-based survey of the same set of leadership positions in all 50 states and the District of Columbia. For the semistructured interviews 7 to 8 positions, including at the executive level (chief executives, senior deputies, chief financial officers, and legislative liaisons) and at the division/bureau level (heads of environmental health, maternal/child/family health, and preparedness), were targeted in each of the 6 states. The 45 interviews focused on budget- and priority-setting processes, decision drivers, and understanding the financial and political environment in which budgets are set, the historical context of the agency and its responsibilities, as well as other organizational characteristics that affect service delivery and decision making. The Web-based survey built on the interview findings and was conducted in collaboration with both ASTHO and the Association of Maternal & Child Health Programs. The fall 2011 survey covered issues complementary to the interview and resulted in 207 responses, or a 67% response rate, which included responses from 48 states and the District of Columbia. Offering an initial glimpse at the findings, this column reports on the criteria reported to be used in budget decisions.

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Budget- and Priority-Setting Criteria

Our initial interviews identified more than 30 different types of criteria. Using terminology adapted in part from previous work done by Baum et al6 and Platonova et al7 for the Web-based survey, we narrowed the list to 19 potential criteria (plus an optional “Other”/write in). We then asked respondents to rate criterion importance in the priority-setting process on a scale of 1 (not important) to 4 (extremely important). Results in the Table show the top 10 criteria, which included the seriousness of the consequences, whether the issue was critical to the mission of the health agency, whether the potentially available funds were sufficient to impact the issue, and whether the health problem was subject to an external directive.



The concept that programs must be “mission critical,” essential services, or core to the agency's purpose or mission emerged as a major theme. Interview respondents identified the “authorizing environment”' as a motivator for the focus on core services. Respondents reported that rounds of compounding budget reductions have meant repeated cuts that now force many to decide between “important” and “critical” programs.

State public health leaders reported using many criteria when making budget- and priority-setting decisions. Although several related to the nature of the public health problem being addressed—for example, how serious are the consequences to the public's health if a program is not funded or how many people are affected—practitioners fundamentally operate in a political environment where much of the final decision making is out of their control. Those at the executive level were more likely to cite external directives than were the respondents who headed a specific division such as environmental health, preparedness, or maternal and child health.

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Steps to a Sustainable Public Health System

State health officials face a difficult task in communicating the value of public health interventions in politically acceptable terms. This is especially true during difficult financial times like the present. Some may view this merely as the way things are and do not feel it worthy of further commentary. However, we take the position that a better understanding of how and why politics interacts with the budget- and priority-setting processes is critical to a sustainable public health system. In the course of future research with these and complementary data, we plan to characterize budget- and priority-setting processes and typify trends through further examination of criteria, the use of fees/fines to supplement funding, budget tradeoffs, and the impact of political structure and historical context on decision making. Findings from this and related research will allow for the creation of decision support and evidence-based tools that are both theoretically sound and practically useful because they comport with political realities. In this era of diminishing resources and health care changes, these tools are ever more critical for a public health system to ensure protection of the public's health.

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ASTHO's Winter Meeting

In December 2011, a total of 28 state health officials entered into a meeting in San Antonio to begin considering what “the health department of the future” should be. Health officials exchanged practical ideas and frameworks for making decisions around prioritization and leading state and territorial health agencies into the future, given the current economic and political contexts regarding issues such as opportunities and challenges associated with state and national health reform efforts, better integration of public health and health care, and voluntary national accreditation. Their ideas resonated with both the findings in the study described earlier and some of the recommendations in the IOM's report on public health finance.

Echoing the “mission critical” criterion described earlier, the state health officials emphasized the importance of prioritization tools to help SHAs identify a critical set of core services. They also agreed that services that can be provided only by SHAs should be given special consideration, which aligns with the “delivery by others” criterion identified in the Johns Hopkins-ASTHO survey. This theme pervades the IOM report, particularly in its development of the concept of a “minimum package of public health services” consisting of “foundational capabilities” health departments need to have and “basic services” they need to be able to provide. It is important to take regional variation and unique safety net roles in some states into account when considering what the health department of the future should look like.

Another key component of budgeting in the present time of economic challenges is seeking new funding sources: cost-based reimbursement by Medicaid, charging or increasing fees for services provided, billing insurance companies and ensuring collection, and seeking nongovernmental funding such as foundation grants and other donations. If the IOM report's recommendation to double federal funding for governmental public health is heeded, SHAs may be able to retain their focus on their mission of protecting the health of the public rather than soliciting donations.

In addition, accreditation arose as an important theme in the state health officials' discussions. Similar to the IOM's concept of a minimum package of services (which would be developed from the core functions and essential services framework), accreditation serves to establish a baseline for expectations and accountabilities. Accreditation is useful to promote quality improvement to close the gap between standards and performance. It can also promote sharing of resources both within and across jurisdictions in a time when these may be very rational approaches. It can also be used as a planning tool for health agencies: some agencies are using accreditation standards as a basis for strategic planning, which is itself a prerequisite for accreditation. Accreditation may be helpful in the search for additional resources as well.

The integration of health care and public health was another theme that emerged as an important feature of the health department of the future. Public health leaders need to engage with the health care system but strongly noted the need to integrate rather than assimilate. The next few years will be a critical time to ensure that the effectiveness and efficiency of both public health and health care are mutually enhanced by the kind of integration that sustains the strengths of both public health and health care approaches to protecting and improving the health of the public. Important public health contributions to maintain during this integration include:

  • monitoring and reporting on the performance of the health care system;
  • serving as a safe and legitimate convener of competing providers, health systems, and insurers; and
  • supporting the entry of the health care industry into the population health perspective.

It will be critical for public health leaders to develop population health quality measures (both process and outcomes) and to generate broad endorsement of these measures.

In the context of harsh economic realities, budget and priority setting is both difficult and constant. The IOM report points out, “The funds allocated to public health depend heavily on how the executive and legislative branches set priorities,”1 (pxiv) which applies to both federal and state levels. The health of the population depends on state health officials bridging public health science and political realities to obtain the resources that allow SHAs to pursue their missions.

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1. Institute of Medicine. For the Public's Health: Investing in a Healthier Future. Washington, DC: Institute of Medicine; 2012.
2. Jarris PE. Challenging times for the governmental public health enterprise. J Public Health Manag Pract. 2012;18(4):372–374.
    3. Willard R, Shah GH, Leep C, Ku L. Impact of the 2008–2010 economic recession on local health departments. J Public Health Manag Pract. 2012;18(2):106.
      4. Novick LF. Local health departments: time of challenge and change. J Public Health Manag Pract. 2012;18(2):103.
      5. National Association of County & City Health Officials. Trends in Local Health Department Finances, Workforce, and Activities: Findings From the 2005 and 2008 National Profile of Local Health Departments Studies. Washington, DC: National Association of County & City Health Officials; 2010.
        6. Baum NM, DesRoches C, Campbell EG, Goold SD. Resource allocation in public health practice: a national survey of local public health officials. J Public Health Manag Pract. 2011;17(3):265.
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        © 2012 Lippincott Williams & Wilkins, Inc.