Some time ago (see July 1994 issue of Circulation), we described some innovative cost-management strategies used by the National Heart, Lung, and Blood Institute (NHLBI) in funding research project grants and provided preliminary data on their effectiveness. Now, with 5 years of experience in implementing these strategies, we would like to revisit the issue and focus more detailed attention on the extent to which our approaches have benefited the research enterprise.
As the readership may recall, impetus for development of new financial management approaches was provided by the House Appropriations Committee report for fiscal year 1991, which urged the National Institutes of Health (NIH) to “aggressively eliminate any costs which they believe are unnecessary … [after which] a grant should be funded at the full level without arbitrary reductions.” This directive presented a difficult challenge to the NHLBI and other NIH components because rapid escalations in the cost of conducting biomedical research had made it impossible to fully fund the mandated number of grants within the allocation. The widespread practice of imposing across-the-board “downward negotiations” constituted an unenlightened and unwelcome solution to the problem.
After considerable analysis and discussion with the institute’s advisors, a new cost-management approach was put into place based on the following decisions:
to restrict the growth of competing renewal grants by limiting their increase over the last noncompeting year to 10%;
to award new grants at council-recommended levels, less appropriate adjustments for overlap with other support and programmatic considerations;
to make cost a factor in funding decisions (see September 1993 issue of Circulation for a discussion of the NHLBI “value function”);
to cap requested amounts for program project grants and set aside a pool of funds for their support; and
to limit escalation of noncompeting renewal grants to 4%.
This new approach was disseminated and discussed widely with the research community, and the community responded by tailoring grant application submissions to conform to the guidelines. As a result, the rapid escalation in the cost of grants has been checked. As Fig 1⇓ indicates, the average cost of investigator-initiated new and competing renewal grants has remained remarkably stable over the past 5 years.
These strategies had an immediate, dramatic, and progressive effect on the percentage of NHLBI competing research project grants that were funded at recommended levels (see Fig 2⇓). Whereas only 20% of such grants awarded in fiscal year 1990 received full funding, we anticipate that 85% of fiscal year 1995 grants will do so.
It is interesting and gratifying to note that our practice of awarding competing grants at the full council-recommended level has not diminished the percentage of grant applications that actually receive funding. As Fig 3⇓ indicates, NHLBI success rates for research project grants have remained virtually identical to rates for NIH as a whole. This is a remarkable achievement in light of the fact that the NHLBI budget appropriation has not fared as well as the overall NIH appropriation in recent years (see Fig 4⇓).
We believe that the benefits of our approach to cost-management extend far beyond the elimination of the much-deplored “downward negotiations.” Investigators now know what to expect and are able to plan and conduct research in an environment that is relatively predictable. Previously, across-the-board cuts imposed after the initial review of new applications left investigators with insufficient resources to carry out the approved scope of research. This situation actually encouraged investigators to inflate requested amounts in anticipation of expected cuts and prepare unrealistic research plans. With respect to competing renewal awards, applicants now know that they can receive only a 10% increase and design their research within this budget limitation. Thus, the NHLBI has been able to achieve its cost-management objectives and, at the same time, benefit the scientific community by enhancing the stability and predictability of its funding.
- Copyright © 1995 by American Heart Association