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In its Report 104-659 on the FY 1997 budget for the Department of Health and Human Services (DHHS), the House Committee on Appropriations stated:
The following report summarizes the proceedings of the December 4, 1996 workshop sponsored by the NIH to discuss the need for the provision of interim or bridge funding for competing continuations at risk of a lapse in funding. The workshop encompassed a review of data about such projects, different Institute strategies for interim support, and perspectives from a "stakeholders" panel.
With the present funding level, there is concern that renewal applications from competitive investigators may not receive a fundable score leading to potential disruption in their laboratory infrastructure. Research teams may be disbanded or investigators may be unable to hire new staff because of the fiscal uncertainty. Some of these projects have only minor deficiencies, while others have significant shortcomings. Furthermore, some projects may include researchers with whom the NIH has made a long term commitment and is expected to continue to support when the minor problems are resolved. Other projects may suffer from significant difficulties that make continued funding unlikely.
In FY 1996, about 25 percent of the NIH research project applications were competing continuation applications (Type 2). While the success rate for Type 2s (43 percent) is generally higher than that for Type 1, it should be noted that 45 percent of the funded Type 2s are amended applications, with the majority of these in the first amendment. Some investigators experience a lapse in funding between their current grant and renewals, but the reasons for such lapses are varied as are the periods of lapses. The reasons range from investigators' requests for delayed start date to allow time needed to prepare an amended application or the time required to resolve human subjects or animal welfare issues. The lapses are generally short term, less than three months. The primary target for interim funding represents applications that receive excellent assessments by peer reviewers but are not funded. This is important group but relatively small (n~140).
While the focus of the workshop was on interim funding, the length of time between receipt, review, and award is a fundamental issue. If the time required for these processes were shortened, there would be fewer projects faced with the prospect of a lapse in funding. For this reason, the workshop also addressed both interim funding strategies and application to award cycling time strategies.
Currently, the NIH policy affords the Institutes and Centers (ICs) flexibility in handling interim funding, which is reflected in the spectrum of strategies developed. All ICs make use of their authority to provide administrative supplements to projects as interim funding between an unfunded Type 2 application and subsequent submission. Typically, administrative supplements would be deducted from the next award but the timing and characteristics of such an adjustment varies.
Interim funding is not intended to support a research project in its full scope, but it would "bridge" the project until full funding could be obtained. Thus, such funding represents an important recognition of the shared interest of the grantee institutions and the NIH to preserve the integrity of research infrastructure during a lapse in funding. It is with such intent that the NIH requested and obtained a waiver from the Department of Health and Human Services (DHHS) of requirement of full Facilities and Administrative (F & A) costs. All ICs have the option of limiting the F & A costs to 25 percent of direct costs.
Dr. Sue Shafer presented the NIGMS model of interim funding which is based on data that 55 to 65 percent of unamended competing continuation applications within 10 percentile points of the funding range receive funding within a year after the initial funding lapsed. In order to provide "bridge" funds to individuals who would not otherwise receive their competing renewals, the NIGMS Advisory Council endorsed an interim funding policy. Because the funds for interim support are drawn from the overall pool of research funding, the Council directed the NIGMS to take advantage of the DHHS waiver on F & A cost rate. This would allow the Institute to expand its program of modest bridge support to a larger number of original Type 2 applications that fall within 10 percentile points of the Institute's basic payline.
This interim funding policy has just been implemented with FY 97 awards. Eligible applications will include unamended competing continuation applications. The Institute makes decisions regarding interim support based on program needs, and does not require applicants to submit additional applications. The maximum award will normally be no more than 1/3 of the grant's noncompeting direct costs for 12 months. Only one interim award is allowed per competitive renewal. In addition, any balance remaining from the interim award is deducted from subsequent competing continuation award. The NIGMS has set aside approximately $3.5 million for interim funding in FY 97.
Dr. Ronald Geller, Director, Division of Extramural Affairs, presented a detailed analysis of the costs of supporting a bridge award program, based on a proposed dollar amount of $50 -100,000 direct costs for 1 year and recovery of cost of the award by the Institute if a full grant award were subsequently made. The analysis has been presented to the NHLBI Advisory Council. If interim funding were considered for unamended competing renewal applications within 5 percentile points of the Institute's payline, it would entail costs of $1 - 2 million in FY 93 and FY 94. The costs increase to $ 3 - 5 million if the zone for consideration were expanded to 10 percentile points beyond the payline. Although the proposed bridge award program does not represent a large proportion of the Institute's competing expenditures (less than 3 percent in FY 94), the resources to support the program would have to be obtained by denying funding to applications that otherwise would to paid or by imposing a uniform percent reduction on all grant awards. The NHLBI analysis further showed that beginning investigators and those with an MD degree would be affected if interim funding were implemented by denying support to awards that would otherwise have been paid. Alternatively, a uniform reduction of up to 0.6 percent in FY 94 would have been required on all competing and non-competing research project grant awards. Although these reductions are relatively small, such an approach would undermine a basic tenet of NHLBI policy, which is to fund grant applications at the direct cost levels recommended by the scientific review groups.
Dr. Geller also discussed the modeling of a proposal for expedited or streamlined re-review of applications that just missed the payline (see below). Based on these analyses, the NHLBI concluded that such a program would absorb the funds (about 15 percent of dollars available) currently used for its own selective payment of grants. Select pay is used specifically to fund Type 1s and type 2s that would otherwise suffer from a lapse in funds and results in full payment without requiring applicants to submit additional information. The NHLBI Council concurred with the current Institute practice of using interim or bridge funding on a few, selective applications.
Dr. Marvin Kalt, Director, Division of Extramural Activities, presented the NCI model of Accelerated Executive Review (AER). Under this model, original, unamended Type 1 (new) or Type 2 (competing) R01 applications that are within 4 percentile points of the payline for basic research or 10 percentile points for patient oriented research are eligible for an expedited, administrative review. Eligible applicants are notified by the NCI along with the receipt of their Summary Statements. These applicants have the option of submitting a 3-5 page response to the critique. These responses are promptly reviewed by Institute program staff and forwarded to the NCI Executive Committee, composed of both Institute Director and senior staff, as well as extramural researchers who are appointed as temporary employees under the Intergovernmental Personnel Act. The Committee determines whether the application would be funded, based on scientific merit and not on high program relevance. The central question that drives the Executive Committee's decision is whether the application is likely to move up in rank to within the payline. The Committee has several options: to pay or reject the application after AER, to consider later as possible exception or immediately as a Shannon Award, to recommend interim funding, or to recommend a standard resubmission of a revised application.
The AER does not involve interim funding because a full project award is made. In FY 96, the NCI Executive Committee reviewed 51 applications under the AER (31 basic research and 20 patient oriented research). The committee recommended 26 of these for awards, for a total costs of $6.7 million which came from funds for the Institute's pool of exceptions to the payline awards.
The major benefit of AER is the elimination of eight months from the amendment process for successful applicants. It is also designed to encourage clinical projects and time-sensitive collaborations. However, an important message underlying the NCI AER program is that the original application should represent the best efforts from the applicant, thus reducing the reliance of some applicants to use the Summary Statement from the initial application as a tutorial to improve subsequent applications.
Dr. John McGowan, Acting Deputy Director of NIAID, presented his Institute's strategy of providing interim funding. Its bridge award program funds both Type 1 and Type 2 applications in percentile order of unsolicited RPG applications. The bridge award is made for one year with provision for the principal investigator to either terminate early or receive a no-cost extension. Unlike the NIGMS model, there is no cap on either direct or indirect cost. But like the NIGMS model, any unexpended bridge funding is deducted from the subsequent award. The bridge program is supported as a selective pay mechanism.
Dr. McGowan also described a pilot project with the Tropical Medicine review group that would considerably shorten the time from submission to funding decision. Potential applicants (e.g. those who applied during the last four years and were reviewed by the Tropical Medicine study section, since it is "captive" to one IC and the research community appears to be relatively well-defined) would be asked to self-refer their applications to the study section and self-assign to the Institute. Review would be conducted electronically, and applications that fell within the Institute's payline that did not have human subject or animal welfare concerns would receive en bloc approval from the IC's Advisory Council. (NIAID has expedited council review, making that Institute a logical choice for the pilot.) Thus, some applicants could be funded soon thereafter and others would be asked to submit a 3-5 page abbreviated resubmission to the same study section.
This approach represents a reengineering of the entire process from referral to award. As the cycle time period is shortened, fewer projects would experience a potential lapse in funding that might require interim support.
A panel presented some of the views of the external community. Dr. Robert Rich, Chairman, Committee on Public Affairs, American Association of Immunologists, and Vice President and Dean of Research, Baylor College of Medicine, presented a rationale for the need for interim support. He shares the NIH view that lapses in funding are inherently wasteful, both for the grantee institutions and the NIH. He applauded the NIH for its interim support programs and suggested that these programs be designed to minimize impact on the R01 payline. This objective can be achieved through cost-sharing with the grantee institutions by the reduction in indirect cost rates. Dr. Rich noted that the burden of continued support for faculty members who did not compete successfully with their renewal applications would have been the responsibility of the institutions. While Dr. Rich's proposal share common features with some ICs' interim support programs -- limiting eligibility to Type 2 applications, funding decisions based on likelihood of success of amended applications as reflected by the priority scores, rapid response time between Summary Statement receipt to bridge support decision, and minimal review burden -- the key distinction in Dr. Rich's strategy was a formula-based block grants to the institutions without F & A costs. He argued that a locally-administered bridge program placed the decision in the hands of those who can make a critical assessment of the financial needs of the investigators. This idea is similar to the currently unfunded Biomedical Research Support Grant (BRSG) program.
Mr. Milton Goldberg, President, Council on Government Relations, also endorsed the need for interim support mechanisms, but raised the point that the NIGMS model with the suppressed F & A rate was inappropriate and that full F & A costs should be provided. While there is no question that F & A costs are real costs, there was discussion around what would be considered appropriate level as well as the basis for the DHHS waiver. However, it was clear from the IC presentations that the use of the waiver was quite limited, and so far only the NIGMS has invoked it.
Dr. Howard Schachman, NIH Ombudsman, reiterated the concern that competitive projects not be jeopardized by lapses in funding, but noted that the NIH had several mechanisms for addressing this possibility. He did not share Dr. Rich's view of a BRSG-type mechanism, and maintained that it is essential for the NIH to retain the authority to review and assess the scientific merit of projects deemed worthy of interim support. He concurred that shortening the time from submission to award could minimize, but not eliminate, the problems of a funding hiatus.
Dr. Baldwin expressed appreciation for the ideas and suggestions offered for interim support. She indicated that the ICs have flexibility in developing an optimal mechanism to provide interim support that would be consistent with the ICs' portfolio and also meets the needs of the investigators.
Amendment (amended or revised applications) -- Resubmission of an unfunded application that has been revised in response to a prior review.
Application -- A request for support of a project or comparable activity.
Application Type --
Type 1 -- New
Type 2 -- Competing Continuation (or Renewal)
Award -- A statement that funds have been obligated. This includes both direct and indirect costs unless otherwise indicated.
Competing Continuation -- An application that requires competitive peer review and institute/center action to continue beyond the current competitive segment. Also known as a Renewal or Type 2.
Council/Board -- Statutorily mandated National Advisory Council or Board that provides the second level of review for grant applications for each institute/center that awards grants. The Councils/Boards are comprised of both scientific and lay representatives. Council/Board recommendations are based not only on the consideration of scientific merit (as judged by the scientific review groups), but also on the relevance of the proposed study to an institute's programs and priorities. With some exceptions, grants cannot be awarded without recommendations for approval by a Council/Board. Councils/Boards make recommendations on funding to institute staff and advise on the overall program of the institute they serve.
Direct Cost -- Costs that can be specifically identified with a particular project or program, such as costs for equipment, personnel, travel, and other expenses necessary to carry out a research project.
Indirect Cost -- Costs that are incurred by a grantee organization for common or joint objectives and, therefore, cannot be identified specifically with a particular project or program. Revised OMB circular A-21 (published May 8, 1996) replaced the term "indirect" costs with the more descriptive term "facilities and administrative" (F & A) costs. F & A costs are allocated to projects and programs based on rates negotiated between the Federal granting agency and the grantee institution. Several NIH research grant mechanisms are not eligible for full F & A cost reimbursement: foreign research grants; conference grants (R13s); education grants (R25s); Shared Instrumentation Grants (S10s); research career program awards (Ks); and National Research Service Awards.