Discretion in priority-setting at state health agencies

Recent efforts from the Association of State and Territorial Health Officials has given researchers new insights into how much state health agencies are spending on public health. However, we continue to lack a systematic understanding of why leaders of state health agencies spend funds in the way that they do. An important component of budget- and priority-setting relates to discretion associated with various sources of revenue, as well as legal and regulatory restrictions placed on the agencies that may leadership ability to address emerging health needs. In order to characterize the current state of discretion in state public health budgets, we conducted a two-stage mixed methods project. In the first stage, 45 public health leaders from six state health agencies were interviewed. Next, a complementary, national web-based survey went out to all state health agencies; we received responses from 207 respondents (response rate of 66%). Survey respondents did not all agree that political considerations decreased discretion, although in some states this was uniformly reported. State General Funds were viewed as the most flexible, alongside federal block grants and cooperative agreements. Categorical grants and programmatic grants were seen as the least flexible. There was not agreement on fees/fines, as some respondents reported laws on the books that either required fees/fines to be spent on the program of origin, or some substantial portion of the fees/fines be sent back to the state government for use in general fund allocation. On average, federal funds now account for the largest portion of state health agency funds. Some divisions (especially Preparedness), rely almost solely on federal funds. This increased reliance on federal funds has offered some protection against common state budget cuts, but has also moved the locus of priority-setting more toward the federal level and away from the state level.