HHS begins to release stimulus funds

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Authorized and funded by the American Recovery and Reinvestment Act (ARRA), the Department of Health and Human Services (HHS) has formed Federal Coordinating Council for Comparative Effectiveness Research, allocating $1.1 billion to coordinate research and guide investments in comparative effectiveness research. HHS also gave states access to an additional $268 million authorized under the stimulus to help pay hospitals to treat underserved patients.

"Comparative effectiveness research can improve care for all Americans and is an important element of President Obama's health reform plan," said HHS Spokeswoman Jenny Backus. The council will host open meetings and a listening session as it begins its work, she added. Comparative effectiveness research provides information on the strengths and weakness of various medical interventions, which the HHS said will give clinicians and patients information to make decisions that will improve the performance of the U.S. healthcare system

The 15 member council, in accordance with a congressionally mandated timeline, will assist the agencies of the federal government, including HHS and the Departments of Veterans Affairs and Defense, to coordinate comparative effectiveness and related health services research, the agency said. The stimulus authorized $300 million for the Agency for Healthcare Research and Quality (AHRQ), $400 million for the National Institutes of Health (NIH) and $400 million for the HHS Secretary to support comparative effectiveness research.

HHS said that the council will not recommend clinical guidelines for payment, coverage or treatment. The council will consider the needs of populations served by federal programs and opportunities to build and expand on current investments and priorities. It will also provide input on priorities for the $400 million fund in the ARRA that the Secretary will allocate to advance this type of research.

The agency simultaneously announced that eligible hospitals for the additional $268 million are those that serve a disproportionate share of low-income or uninsured individuals-known as Disproportionate Share Hospitals (DSH). States receive an annual allotment to make payments to DSH hospitals to account for higher costs associated with treating uninsured and low-income patients. The annual allotment is calculated by law and includes requirements to ensure that the DSH payments to hospitals are not higher than the actual costs incurred by the hospital to provide the uncompensated care.

The ARRA increased the amount of allotments available to states from approximately $11.06 billion to $11.33 billion for 2009.

The Centers for Medicare & Medicaid Services (CMS) said it will notify states about the availability of the increased portion of allotments for hospitals. Not all states spend their full DSH allotments; so, before this new funding can be accessed, states must demonstrate they have used all of their existing fiscal year 2009 DSH allotments. States must request the additional funds from CMS as part of their quarterly Medicaid budget request and the funds will be distributed as separate Recovery Act DSH grants.

To see a complete list of the revised DSH allotments that include additional funding provided through the ARRA, please visit http://www.hhs.gov/recovery/cms/dshstates.html.