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Rationale of HCQO Budget Request

Performance Budget Submission for Congressional Justification

This statement summarizes budget information submitted to Congress by the Agency for Healthcare Research and Quality (AHRQ).

D. Rationale of HCQO Budget Request

 FY 2007 Continuing ResolutionFY 2008 RequestChange from Prior Year





Patient Safety Research$84,000,000$93,934,000+$9,934,000
(Patient Safety - Health Information Technology)($49,886,000)($44,820,000)(-$5,066,000)
(General Patient Safety Funds)($34,114,000)($49,114,000)(+$15,000,000)
Non-Patient Safety Research$176,692,000$177,630,000+$938,000
(Effective Health Care Program)($15,000,000)($15,000,000)($0)

The FY 2008 Request for the HCQO budget activity totals $271,564,000, an increase of $10,872,000 from the FY 2007 Continuing Resolution level. It is within HCQO that the Agency for Healthcare Research and Quality (AHRQ) supports the patient safety and health information technology programs, a total of $93,934,000 at the Request.

HCQO: Patient Safety Research

AHRQ's patient safety program is aimed at identifying risks and hazards that lead to medical errors and finding ways to prevent patient injury associated with delivery of health care. The FY 2008 Request provides $93,934,000 for patient safety research, an increase of $9,934,000 from the FY 2007 Continuing Resolution level. Within patient safety, research related to Health Information Technology (health IT) is funded at $44,820,000, a reduction of $5,066,000 from the prior year. The decrease in this program comes from non-competing grants that end in FY 2007. These funds were not re-invested into new patient safety health IT grants in FY 2008. General patient safety research is funded at $49,114,000, an increase of $15,000,000 from the FY 2007 Continuing Resolution level. The entire increase is dedicated to the Personalized Health Care Initiative. The remaining funds for general patient safety research focus on AHRQ's patient safety research portfolio, including funds dedicated to the Ambulatory Patient Safety Program and the Patient Safety and Quality Improvement Act of 2005.

Patient Safety Research and Training Grants

Research grant support for the patient safety program totals $34,053,000 (78 grants) at the FY 2008 Request. This is a decrease of $6,786,000 (22 grants) from the FY 2007 Continuing Resolution level of $40,839,000. In terms of new research grants, the FY 2008 Request funds 15 new grants for a total of $5,941,000. All of the new patient safety grants in the FY 2008 Request will build on the proposals developed for the FY 2007 Ambulatory Patient Safety program. Areas of focus will include medication management tools such as e-prescribing, improved information tools at the point of care and for clinicians and consumers and improvements in chronic illness care and prevention. A total of $3,393,000 will be funded with patient safety health IT funds and $2,548,000 will be funded with general patient safety funds.

The FY 2008 Request continues the Ambulatory Patient Safety Program, comprised of $29,388,000 in patient safety Health Information Technology funds and $5,814,000 in general patient safety funds. This program continues AHRQ's overall patient safety vision to reduce the risk of harm from health care services by promoting the delivery of appropriate care that achieves the best quality outcome. The Ambulatory Patient Safety program both complements and contributes to the overall goals and objectives of the President's Health Information Technology Initiative, the American Health Information Community (AHIC) and those of the Office of the National Coordinator for Health Information Technology (ONC).

Patient Safety Research Contracts and Inter-Agency Agreements (IAAs)

Support for patient safety research contracts totals $59,881,000 at the FY 2008 Request, an increase of $16,720,000 from the FY 2007 Continuing Resolution level. Of this increase, $15,000,000 is allocated for the Personalized Health Care Initiative. The Request also reflects an increase of $1,720,000 for several research contracts, including contracts and IAAs related to the Patient Safety and Quality Improvement Act of 2005 and the Ambulatory Patient Safety (PS) Program. No other new patient safety contracts are proposed at the FY 2008 Request level.

Personalized Health Care Initiative

Improving the quality and effectiveness of health care—providing the right care to the right patient at the right time, and getting it right the first time—remains a challenge in the United States. At the same time, the cost of providing that care continues to grow. Currently it is estimated that per capita health spending in the United States is the highest in the world. Today, the opportunities to deliver high quality, cost-effective care are growing exponentially as a result of our ongoing investments in genomics, molecular biology, and basic biomedical research. The additional diagnostic and treatment options research yields will soon make it possible to provide highly effective individualized care in an unprecedented fashion. But we will also face growing challenges in making clinical use of this new knowledge. In a consumer- and value-oriented health care system, increased options need to be accompanied by the information necessary to evaluate those choices and make more informed decisions. The transition of patient care from a paper-based system to an electronic system has important implications. Adoption of health information technology means that information about new interventions can be deployed more rapidly and disseminated more broadly than ever before. Fortunately, health IT also provides us with the vehicle for transforming our health services research enterprise so that we can evaluate the effectiveness of these interventions in real-time by providing answers to questions such as:

  • How the breakthrough compares with existing and other new interventions?
  • Which classes of patients benefit most from each intervention?
  • What is the most effective and efficient approach to delivery?

Today, only a few networks around the country have the data systems that will allow doctors, nurses, researchers and others to answer these important questions. However, the questions they can ask are often limited to the most common drugs and diagnoses. Many emerging breakthrough treatments will apply to a small number of patients, for example, a new treatment that cures 10 percent of patients with non small-cell lung cancer would be effective for approximately 14,700 patients across the nation from the 147,000 affected. Even the largest systems with sophisticated health IT would be likely to include only a small percentage of these individuals, limiting capacity to detect adverse events and identifying individuals who meet the criteria for the new treatment but do not respond to the treatment effectively. A larger network, such as the one proposed here, offers the opportunity to capture a larger percentage of those who respond effectively, increasing the ability for doctors to provide the right treatment to the right patient.) By leveraging the role of the federal government as a convener, in addition to its roles as the largest purchaser of health care and a major supporter of scientific advances, we will create a virtual network, with a public-private governance, that will allow the data to remain within those systems while achieving the dramatic improvements in care seen from strongly centralized efforts to research and development (e.g., the vast majority of pediatric oncology patients are referred to a small number of regional research and treatment centers. Over the past 20 years survival rates have increased for children with cancer at a much more rapid rate than for adults, a fact attributed in part to the fragmentation between the research and care delivery enterprise for adults.) The results of our efforts will be health information that can be easily shared, searched, measured and analyzed to determine what treatments and drugs are most effective and at what cost regardless of the size of the network. In addition, this network will be designed to be relevant for multiple types of studies and surveillance efforts, thus offering sustainable or re-usable infrastructure.

In its Personalized Health Care Initiative, the Department of Health and Human Services will accelerate the movement toward personalized health care and help bring "next generation" effectiveness of care for individual patients. This initiative is essential to our drive for health care transparency (by identifying and consistently measuring effective, high quality care). The initiative undertakes pioneering work in the utilization of health IT for linking clinical care with research progress and, ultimately, genomic data. The long-term result will be greater medical effectiveness, greater cost effectiveness, other advances into clinical practice, and improved quality and safety for patients.

AHRQ proposes the creation of a sustainable clinical effectiveness research enterprise, with broad participation and support from the public and private sectors. The goal is to meet the common need for better information that can be developed in time frames that our traditional approach to research cannot match. We have started to see the potential for real-time research through a network we developed as a component of our Effective Health Care Program (MMA Section 1013). That network, consisting of organizations with large databases of electronic clinical information, has enabled us to assess the effectiveness of interventions in dramatically shorter time frames, without threat to individual privacy. By building upon that capacity, and expanding it as electronic health records become a reality, we can ensure that the information that is essential for consumer and value-based decisionmaking can be linked to the deployment of new interventions and innovations. This proposal is designed to create and sustain a partnership between public and private payers and delivery systems to support evidence generation as a byproduct of health care delivery. It expands on the work currently being undertaken in the Healthcare Transparency and builds on the base of the existing Effective Health Care program by establishing a federation of nationally representative care delivery research networks and data sources that incorporates cutting-edge genomic science. Over time, as the federation grows and as cutting-edge genomic medicine and innovative technologies become available, data available will become more robust allowing us to

  • Determine with increasing precision which treatments work best for which patients.
  • Accelerate the uptake of effective (or transformative) medical innovation into health care practice, including making appropriate use of innovation that results from our progress in genomic and molecular medicine.
  • Support the development of new, more effective methodologies, which can be used to accelerate the development of new breakthroughs across the research enterprise.

This initiative expands the infrastructure necessary to ensure that we have a health care system that provides good quality health care at affordable prices by accelerated integration of cutting edge innovations in medicine, including genomics, into the clinical practice. It is focused on three areas:

  1. Developing a Network of Networks.
  2. Integrating Administrative and Clinical Data.
  3. Developing Quality Standards.

In FY 2008, the program will concentrate on:

  1. Building Data Capacity and Infrastructure: Build upon the existing data systems and the methodologies developed by AHRQ's rapid cycle research networks (such as DeCIDE, ACTION, PBRNs) and the relationships established by the Eisenberg Clinical Decisions and Communications Sciences Center by expanding formal on-going partnerships with medical and professional societies, provider groups, states, and industry to create incentives to allow data access and sharing using a federated approach to build a "Network of Networks." This approach creates a federation of public and private data sources that will allow population-based research questions from outside a specific health care organization using agreed upon terms, descriptions, and concepts. In particular, this approach facilitates collaboration across health care organizations to address the impact of new innovations that affect a small population (for which no single care delivery system would have sufficient sample size). Moreover, this approach—supporting a collaboration of research networks—will also support and sustain both practice improvement and practical research. Building new and linking existing practical practice-based research networks will make possible the generation of evidence—new knowledge—during the course of health care delivery at a lower cost and shorter time line. This approach will also accelerate implementation of a roadmap for clinical decision support that incorporates recent advances from biomedical science in a rapid time frame, dramatically shortening the current time between discovery and delivery. The close linkage between care delivery and knowledge generation will make it possible to accelerate delivery of innovations (only) to those likely to benefit, and clarify alternative options for individuals likely to experience harms or no benefits. In addition to building the infrastructure, issues related to the identification of legal, human subjects, privacy, and proprietary issues and the overall process for the network functioning will be addressed.

  2. Integration of administrative data and clinical information: For the foreseeable future, administrative data will continue to be an important input to policy relevant analyses, quality assessment and transparency. Administrative data are available for virtually all US patients and have been used for a wide-range of purposes at the local, state and national levels, including quality reporting and improvement, public health planning and surveillance, policy analysis and financial strategic planning. Because they are widely available (almost all states have all-payer data programs) and relatively easy to access and use, administrative data are being turned to more frequently to address more urgent questions and produce more actionable results, such as use in public reporting, transparency, and payment incentives. Recent AHRQ studies show the cost-benefit of adding specific clinical data to administrative data to support transparency efforts and quality improvement. These studies will provide the framework for expanding data beyond what is currently available by enriching it with clinical electronic data and extending availability of data to new sites of care. We will do this by building on, and continuing to support, the partnerships of the AHIC, emerging regional health information exchanges (RHIEs), the Nationwide Health Information Network (NHIN), quality care alliances (AQA and HQA), and AHRQ's Healthcare Cost and Utilization Project (HCUP). Taking advantage of existing partnerships and administrative data sources, such as HCUP, by adding specific clinical information available through electronic health records, prescription data, and laboratory data is a more efficient and practical approach to expanding research and transparency reporting capacity than creating a new data infrastructure.

  3. Accelerating the development of Quality Measures: This component of the program utilizes an evidence-based process to develop measure sets that consumers, payers and purchasers can use to evaluate the cost and quality of healthcare services available. Initial measure development would focus on issues that are essential to improving value but not yet part of the quality measurement enterprise—efficiency, coordination of care, care for individuals with multiple chronic illnesses—utilizing currently existing Department of Health & Human Services (HHS) data.

    As the Network of Networks matures, additional measure development will make use of clinical data systems developed as a result of breakthroughs made in health care information exchange and the capacity of the proposed Partnership for Effective Healthcare Component. All measures will be based upon the most recent published evidence and user input, and will be risk adjusted, empirically tested, and validated. These evidence-based measures will receive organizational endorsement. In addition, support for users will also be provided in the form of technical assistance, access to technical specifications, user documentation, implementation tools (includes the development and testing of software), maintenance (and refinement) of the measures, tools and documentation, development of science-based reporting templates, and, when appropriate, recommendations for the development of composite measures. We will work closely with the AHIC work group on quality and other major stakeholders and users. In FY 2008 we will focus on developing and maintaining measures for immediate need, such as those outlined in Secretary Leavitt's Health Care Transparency initiative. In addition, we will begin to develop the standards required to ensure innovations in the emerging field of genomics can be incorporated into a single digital network. This will result in producing measures that are "plug and play" ready—which is they can be easily incorporated by a variety of stakeholders into new or existing electronic health records.

As a result of this investment, HHS will accelerate the movement toward personalized health care and help bring "next generation" effectiveness of care for individual patients. This initiative is essential to our drive for health care transparency (by identifying and consistently measuring effective, high quality care). The initiative undertakes pioneering work in the utilization of health IT for linking clinical care with research progress. The long-term result will be greater medical effectiveness, greater cost effectiveness, other advances into clinical practice, which will ultimately improve quality and safety for patients.

Patient Safety and Quality Improvement Act of 2005

In addition, the FY 2008 Request provides funds to continue AHRQ's work on the Patient Safety and Quality Improvement Act of 2005 (PSQIA)—Public Law No. 109-41 The Act is intended to improve quality of patient care by encouraging health care providers to voluntarily report patient safety information, medical errors, and "near misses" to Patient Safety Organizations (PSOs). Federal legal privilege and confidentiality protections apply to information that is assembled and reported to a PSO or developed by a PSO for the conduct of patient safety activities. Within a protected framework, the Act encourages health care providers to contract with PSOs to:

  • Collect and analyze data on patient safety events (a term that encompasses "near misses," "close calls," and "no-harm" events as well as all types of medical and other health care adverse events).
  • Develop and disseminate information to improve patient safety and to provide feedback and assistance to effectively minimize patient risk.

The Act allows PSOs to analyze information reported from providers and disseminate information back to providers in efforts to improve quality and patient safety. Providers will work with PSOs to determine the causes of these errors, identify what changes need to be made to prevent these errors, and then implement changes.

The Act authorizes the Secretary to:

  1. Establish a process for the certification and oversight of Patient Safety Organizations.
  2. Establish common definitions and formats for reporting to and among a network of Patient Safety Databases (NPSD).
  3. Provide technical assistance to PSOs.

The Act requires the Secretary of Health and Human Services to facilitate the creation of a network of databases to analyze health care errors. It stipulates that the NPSD shall be an interactive evidence-based management resource for providers, patient safety organizations, and other entities. The network of databases shall have the capacity to accept, aggregate across the network, and analyze non-identifiable data voluntarily reported by PSOs, providers, and other entities. The Act also authorizes the Secretary (AHRQ) to provide common formats for reporting to and among the network of patient safety databases, including common and consistent definitions and a standardized computer interface, pursuant to aggregation of patient safety data nationwide.

Based on rigorous, detailed review of all patient safety reporting systems in existence, AHRQ shall develop a uniform database, establish national standards for the collection and maintenance of patient safety data, and provide technical assistance to PSOs. Information reported to and among the network of patient safety databases shall be used to analyze national and regional statistics, including trends and patterns of patient safety events. Information from these analyses will be made publicly available and included in annual reports by the Secretary to Congress on the quality of health care.

In FY 2008, AHRQ will allocate $6,500,000 in contract funds within the patient safety budget for the implementation of this Act.

HCQO: Non-Patient Safety Research

AHRQ's non-patient safety program has a broad research agenda that touches on nearly every aspect of health care. AHRQ-supported researchers are working to answer questions about: care management; cost, organization and socio-economics; data development; long-term care; pharmaceutical outcomes; prevention; training; quality of care; and system capacity and bioterrorism. The FY 2008 Request provides support of $177,630,000, a slight increase of $938,000 from the FY 2007 Continuing Resolution level.

Non-Patient Safety Research and Training Grants

At the Request AHRQ will support 131 grants for a total of $32,692,000. This is a decrease of $6,626,000 (65 grants) from the FY 2007 Continuing Resolution level of $39,318,000. At the Request, AHRQ will provide $3,706,000 to support 42 new grants. These funds will continue research in our three strategic plan goal areas, with specific emphasis two portfolios of work: care management and prevention. New grant funding will include one-year awards such as small, conference, and dissertation research grants and multi-year larger grants such as large research grants, research career awards, Primary Care Practice Based Research Networks (PBRNs), Building Research Infrastructure and Capacity (BRIC), and Minority Research Infrastructure Support Program (M-RISP). Finally, the FY 2008 Request also provides approximately $9,000,000 in continuation support for new grants funded in the FY 2007 Continuing Resolution.

Non-Patient Safety Research Contracts and IAAs

Support for non-patient safety contracts totals $84,838,000, an increase of $3,983,000 from the FY 2007 Continuing Resolution level. Of this increase $3,730,000 will support contracts related the Value-driven Healthcare Initiative—a project funded with the Centers for Medicare & Medicaid Services (CMS) and the private sector. The remaining $253,000 reflects an increase in non-patient safety continuation costs for several contracts.

Value-driven Healthcare Initiative

The overarching goal of the Value-driven Healthcare Initiative (+$3,730,000), formerly known as the AQA Alliance pilot projects, is to enhance person and population-centered care by improving the quality of healthcare services and reducing healthcare costs. Major HHS goals and objectives reflect the President's Executive Order and are to:

  1. Promote the establishment of health information technology standards for exchanging price and quality healthcare data.
  2. Promote the establishment of transparent, nationally endorsed, consensus-derived quality measures.
  3. Promote the establishment of transparent, nationally endorsed, consensus-derived measures of price/cost.
  4. Promote the use of provider and consumer incentives for quality and efficiency.

This Initiative's design is based on three fundamental principles. The first is that at its core, healthcare is local—provided in uniquely constituted cultural and market-based environments. As such, improving the value of that healthcare requires a critical mass of community stakeholders (including purchasers, health plans, providers, and consumers) investing their time and resources toward shared cost and quality improvement goals. We refer to these community entities as local multi-stakeholder collaboratives.

The second principle is that broad access to accurate, meaningful information will improve the value of healthcare services by:

  1. Stimulating provider improvement.
  2. Engaging consumers in provider selection and treatment choices.
  3. Enabling purchasers to align consumer and provider incentives.

Generating such information will require operational and behavioral changes among virtually all stakeholders.

The third principle is that establishing a nation-wide learning network will foster market-based healthcare reform. Learning networks are an evidence-based approach to rapid dissemination and adoption of best practices. They are comprised of individuals or groups focused on common broad goals. To be most effective and demonstrate impact learning networks must:

  1. Provide face to face opportunities for peer to peer sharing of experiences.
  2. Conduct quantitative trending on standard measures used by all participants to identify interventions/tactics that yield the best outcomes.
  3. Translate interventions into adaptable change strategies.
  4. Provide a user-friendly Web-based knowledge repository and communication system.
  5. Identify knowledge gaps where innovation is needed.

The collaboratives will seek to combine public and private information to measure and report on physician and hospital practice in a meaningful and transparent way for consumers and purchasers of health care. They will not only measure care quality, but will identify those high quality providers who are able to deliver efficient care to patients, avoiding unnecessary complications and costs. The collaborative sites also will test the most effective methods to provide consumers with meaningful information that they can use to make choices about which physicians and physician groups will best meet their needs

Based on the above, AHRQ plans to establish a nation-wide learning network of community-based multi-stakeholder collaboratives along with a curriculum for helping to inform these. Specific deliverables will include tools, decision guides, and other content-based materials as well as facilitated meetings (both face to face and virtual).

Effective Health Care Program

The FY 2008 Non-patient safety research contract request also continues support for the Effective Health Care Program. This program provides current, unbiased evidence about the comparative effectiveness of different health care interventions. The object is to help consumers, health care providers, and others make informed choices among treatment alternatives, including drugs. The AHRQ Effective Health Care Program has three approaches to research on the comparative effectiveness of different treatments and clinical practices:

  • Review and synthesize knowledge. The Evidence-based Practice Centers systematically review published and unpublished scientific evidence. A list of comparative effectiveness reviews currently in progress is provided in the text box below.
  • Promote and generate knowledge. The DEcIDE Research Network studies new scientific evidence and analytic tools in an accelerated and practical format.
  • Compile the findings and translate knowledge. The John M. Eisenberg Clinical Decisions and Communications Science Center compiles the research results into a variety of useful formats for stakeholders.

The program was created under Section 1013 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 to conduct research regarding "the outcomes, comparative clinical effectiveness, and appropriateness of health care items and services." The program was launched in 2005 with a $15 million budget. It focuses initially on issues of special importance to Medicare but will be expanded to include Medicaid and the State Children's Health Insurance Program (SCHIP). The FY 2008 Request continues our $15,000,000 investment to support this important program.

Priority Condition(s)Topics
Arthritis and non-traumatic joint disordersComparative Effectiveness of Drug Therapies for Rheumatoid or Psoriatic Arthritis
Arthritis and non-traumatic joint disordersComparison of Therapies for Low Bone Density
CancerComparison of Therapies for Clinically Localized Prostate Cancer
Depression and other mood disordersComparative Effectiveness of Pharmacotherapeutics for Depression
Depression and other mood disordersEvidence for Off-Label Use of Atypical Anti-Psychotic Medications
Diabetes mellitusComparative Effectiveness and Safety of Newer vs. Older Diabetes Medications for the Management of Adults with Type 2 Diabetes
Ischemic heart disease and Stroke and hypertensionComparative Effectiveness of Combinations of Lipid-modifying Agents
Ischemic heart diseaseComparative Effectiveness Reviewof Percutaneous Coronary Interventions and Coronary Artery Bypass GraftSurgery
Stroke and hypertensionWhat are the Comparative Long-term Benefits and Harms of ACE-Inhibitors versus ARBs for Treating Hypertension?
Research Management Costs

The FY 2008 Request provides an increase of $3,581,000 for research management costs. These funds provide for mandatory increases within AHRQ's budget, including pay raises, seven additional Full-Time Equivalent Employees, rent increases and funds for the Unified Financial Management System (UFMS) and the HHS Consolidated Acquisition System (HCAS). Select for more information on the UFMS and HCAS.

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Page last reviewed February 2007
Internet Citation: Rationale of HCQO Budget Request: Performance Budget Submission for Congressional Justification. February 2007. Agency for Healthcare Research and Quality, Rockville, MD.


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