The Government Shutdown, Sequestration & The Future of Medical Research

As you know, these are concerning times. It’s hard to comprehend that the government of the United States of America has been closed for business for nearly a week now. Recently, I had occasion to meet with colleagues in three different settings to discuss common and pressing concerns. The day before the shutdown, I met with the advisory board to the director of the Clinical Center at the NIH. A few days earlier, I met with the board of the Association of Academic Health Centers and before that with a collective of CEOs of major health-related organizations. All of us are deeply concerned about what awaits with respect to federal funding for research, the Affordable Care Act, Health Care Exchanges and more. I imagine these topics are top of mind for you, as well.

Notably, at present, our Health System is in an enviable position, given that most of my colleagues said that their hospitals are seeing a drop in census to 60 percent or less, as well as decreasing revenue. We, on the other hand, grapple with challenges of high demand and have markedly recovered from the financial challenges of last year. This isn’t by happenstance or luck. Our high census is because of our excellent reputation and the outstanding care we provide. And our current financial stability is because of your deliberate and conscientious efforts to see more patients, control resources and improve workflow – all while improving patient satisfaction scores to their highest levels ever. We should take great pride in this, but, at the same time, we must continue to be diligent and focused as we navigate ongoing challenges, such as the current government shutdown and sequestration.

promoimageThis weekend, I shared our concerns in the Detroit Free Press about the $1.5 billion cut to National Institute of Health funding because of sequestration, along with the shutdown (Article). We continue to monitor the impact on our Health System now and in the long term. While current grants have been safe, researchers preparing to submit applications for new grants — including a large number who expected to submit applications in time for a major October 5 deadline – are on hold until the shutdown ends. This may lead to delays in obtaining funding and starting research. Clinical trials already under way at UMHS are continuing, though there may be some slowing in cases where federal agencies process experimental drugs. Some research funded by federal contracts has stopped or may need to, including that of a seven-person team analyzing data from the 2009 pandemic H1N1 flu outbreak for the Centers for Disease Control and Prevention. This group has been told to cease all activities on this project when flu season is right around the corner.

But even without these new threats, it has already been difficult for scientists to get crucial funding for new discoveries. In fiscal year 2013, despite overall growth in federal research funding, NIH funding to U-M fell 1.8 percent. That represents a $9.6 million cut, a significant reduction for those hoping to discover new cures and treatments.

This is a problematic trend. NIH is by far the university’s largest research sponsor, amounting to $509.7 million last year, or more than 38 percent of the total research budget at U-M. And it’s the research conducted on campuses like ours that develops the people and ideas that drive the creation of new products and services, new companies and new industries.

With research funding at risk, research itself is at risk, as is our standing as a global leader in medical innovation. While the rest of the world increases spending for crucial biomedical research — spending is up 20 percent in China and India and 10 percent in Japan and Brazil — U. S. funding has dropped 5 percent. We are falling behind in research spending, and the impact is potentially devastating for our nation’s physical and economic health.

It’s important to note that medical research is a major economic driver, too. The U.S. government invested $3.8 billion in the Human Genome Project and achieved an estimated return on investment of $141 for every dollar spent. That work laid the foundation for significant advances in molecular medicine, energy, bioarchaeology, DNA forensics and even agriculture. According to Robert Wood Johnson Foundation studies, preventing just 5 percent of new cases of chronic conditions would reduce Medicare and Medicaid spending by nearly $5.5 billion each year by 2030. The Information Technology & Innovation Foundation estimates that the impact of sequestration on research will be a loss of up to $200 billion in our GDP over several years.

When we stop investing in research, we’re saying that we as a nation are no longer committed to leading the world in discovery and being on the cutting edge of medical science. We’re saying that we are okay with the fact that our nation — a nation built on pioneering innovation — will no longer be in the lead. We’re saying that we are comfortable becoming increasingly reliant on other nations to develop and produce new drugs, therapies and treatments, even if those nations have different and potentially less stringent regulatory requirements. We’re saying that we are okay with discouraging some of our most prolific and innovative minds from pursuing careers in science and biomedical research because we have decided against funding this work.

Science moves the world forward and medical research offers limitless potential to improve lives and communities. Academic health centers and research institutions like ours are where life-changing science happens. Like you, I take immense pride in being part of the University of Michigan Health System because it means being part of a passionate commitment to making the world a better place, one discovery, one encounter, one family and one patient at a time.

This post is also available in: Spanish

8 thoughts on “The Government Shutdown, Sequestration & The Future of Medical Research

  1. Susan Bailey, RN on said:

    Dear Dr. Pescovitz,
    I appreciate your letter explaining the implications of our gov’t shut down on the medical/research going on at U of M. I share your concerns but don’t have answers for this problem except to pray hard for our President and Congress.

    Thank you for your heart for our Hospital, staff, and the research that is trying to continue. I appreciate your heart and all the hard work you do on a daily basis.
    I am a contingent RN for MVN. I do love taking care of patients. This next February, I will be retiring after 34 years of nursing. I will miss seeing patients and working with a great bunch of nurses.

    Bless you,

    Sue Bailey, RN

  2. Jill Barrett on said:

    They can reduce our resources, they can make us work harder, they can make us do more with less, but they can’t take away our humanistic reasons-for-being and doing what we do. After all, finally, isn’t that why we’re all here? Isn’t that the mission of UMHS?

  3. John Perrin on said:

    Praying, hoping for government to change and working harder with less resources will probably not change much nor will it solve any of the problems we will be facing in the next 5-10 years. It is not the largest or strongest that survives, it is the ones that can most easily adapt to changes in their environment. Not my quote, pretty sure Charles Darwin. This means both hospital administration and the employees will have to be creative at how they look at problems and how to solve them. Our division director has told us many times, “Sometimes you have to step back when looking at a problem and ask not if we are doing the work right but are we doing the right work.” I am amazed at how many times I hear, “This is how I was showed to do it” or “This is how we have always done it.” Never thinking to ask, “Why?”

  4. Jill Barrett on said:

    I agree; it’s time for UMHS to take a good look at itself.

    . . . the key word in my post above is “humanistic.”

  5. Ricki Bobbi on said:

    I’m leaving the research field, I’ve been doing NIH soft money research for 20 years and it’s simply gotten way too difficult and unstabe. Many of my colleagues are doing the same. Our paylines are now hovering between 5-15% depending on which institute you are submitting to.

  6. Gerard Chezick, Pharmacist on said:

    This newsletter provides valuable information. Employees / Shareholders need to be educated about the importance of this information and encouraged to distribute these facts to as large a population as possible. Given the Republican representation for Michigan in Congress, we as voters need to underscore these points with our representatives.

    Furthermore, it is my understanding that Healthcare is one of the largest (if not the largest) industry in this state. Certainly it must be one of the largest in the Country. Is it not possible for this industry to speak with a unified voice, and to use it educate the population and motivate our Representatives?

  7. Deborah L. Totzkay MSN,RN,ACNP-BC,CNOR on said:

    Insightful perspectives on this matter, by congressional scholars Thomas Mann and Norman Orstein, can be observed at Americans need to educate themselves about the authentic role that government assumes in their lives. Moreover, they need to ensure that their views are expressed and heard. Minority rule is not the intent of a democratic society.

  8. John Greden on said:

    Dr. Pescovitz’ message is an important call to action; “let’s have our voices be heard.”

    America’s wonderful research engines can be made more efficient by greater use of pre-competitive collaborations and routine data sharing, more “big data” networks to answer complex health questions, and longer-term studies to develop personalized treatments and maintain wellness. Let’s emphasize these. Let’s not emphasize the short-sighted steps that already are endangering this country’s health research strengths. Please…let’s have our voices be heard.

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