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CARE Act Title II Manual - 2003 Version

VIII. Program Guidance  

2. Priority Setting and Resource Allocation

Introduction

1. Legislative Background and HAB/DSS Expectations
2. A Model for Priority Setting and Resource Allocation
3. Steps in Priority Setting and Resource Allocation
   1. Agree on the priority-setting and resource-allocation process and its desired outcomes.
   2. Agree on responsibilities for carrying out the decision-making process.
   3. Review relevant legislative requirements and program guidances.
   4. Determine and obtain available information “inputs,” including comprehensive plans and needs assessments.
   5. Identify a list of service categories for consideration, including definitions, components, and how best to deliver each service.
   6. Agree on principles to be applied in decision making.
   7. Determine the criteria to be used in priority setting.
   8. Determine the decision-making process to be used.
   9. Implement the process: set service priorities, including how best to meet them.
   10. Define the scope of the resource-allocation process.
   11. Agree on principles, criteria, decision-making process, and methods to be used in allocating funds to service categories. 
   12. Estimate needs by service category.
   13. Allocate resources to service categories.
   14. Provide decisions to the grantee for use in procurement.
   15. Identify areas of uncertainty and needed improvement
4. References

Chapter 2
Priority Setting and Resource Allocation

Introduction TOP

CARE Act resources are limited and need is severe. This heightens the responsibility of Title II to use sound information and a rational decision-making process when deciding which services and other program categories are priorities (priority setting) and how much to fund them (resource allocation).

Priority setting and resource allocation (PSRA) is linked to other planning tasks because it draws upon information compiled from those efforts. For example, which needs are higher priorities depends on data compiled through the needs assessment. However, decisions must often be made with incomplete information, such as limited data on the unmet need for services or outcomes evaluation data on the effectiveness of current services. A thorough PSRA process can help address these information gaps when making decisions about what services to fund.

Legislative Background and HAB/DSS Expectations TOP

States are responsible for setting Title II service priorities, determining how best to meet those priorities, and allocating resources to them. Needs assessment and comprehensive planning should be linked to priority setting so that this information can be used to make sound decisions.

Priority Setting

Section 2617(b)(4)(A) calls for States to “establish priorities for the allocation of funds within the State based on
“(i) size and demographics of the population of individuals with HIV disease" and “the needs of such population…;
(ii) availability of other governmental and non-governmental resources, including the State medicaid plan under title XIX of the Social Security Act and the State Children’s Health Insurance Program under title XXI of such Act to cover health care costs of eligible individuals and families with HIV disease;
(iii) capacity development needs resulting from disparities in the availability of HIV-related services in historically underserved communities and rural communities; and
(iv) the efficiency of the administrative mechanism of the State for rapidly allocating funds to the areas of greatest need within the State;”

Resource Allocation

PSRA requires allocating resources across service categories, whether by absolute dollar amounts or as percents of total funds. This requires deciding the amount or proportion of Title II program funds to be allocated to each of the service priorities that is established.

Resource allocation does not mean procurement. In determining how best to meet stated priorities, the priority setting process may stipulate what provider characteristics should be sought in the request for proposals (RFP) process. However, selection of providers is conducted through separate contracting processes.

Priority Setting and Services to Women, Infants, Children, and Youth with HIV Disease

The CARE Act requires that a certain proportion of Title II funds be used for care and support services to women, infants, children, and youth with HIV disease. The percent of the State’s total Title II service funds that go to services for women, infants, children, and youth must not be less than their percent of the total population with AIDS in the State. This provision does not require States to create a special priority for services to these populations. A waiver to this provision can be granted when States can demonstrate that the needs of each population or combination of these populations is being met through other programs such as Medicaid, Children’s Health Insurance Program (CHIP), or other CARE Act titles.

A Model for Priority Setting and Resource Allocation  TOP

Overview 

The following decision-making model is intended to help plan and implement decision-making processes to set CARE Act priorities and allocate resources among service categories and other program-related activities. It suggests steps that use documented needs in making decisions. Examples are provided. The model is designed to meet legislative requirements and address HAB/DSS expectations. Also provided are guidelines and additional considerations for those with more experience, information, and/or resources. The model recognizes that the process used locally may vary, based upon these factors.

Assumptions

This model includes the following assumptions:

• There is no one ‘right” way to set priorities and allocate resources. This model provides a flexible approach that meets CARE Act requirements and HAB/DSS expectations and reflects actual planning body experience. Case study examples illustrate the process. For purposes of this document, one approach is carried through all the required steps. However, alternative approaches are suggested.
• Priority setting must be guided by CARE Act requirements for planning and priority setting, particularly the emphasis on determining the unmet need for services and eliminating disparities in access and services.
• Emphasis must be on sound practice, not just legislative requirements.
• Priorities should be reviewed annually, though decisions may be continuation of existing services.
• The decision-making process should consider many different perspectives. It should be responsive to identified consumer needs and preferences across diverse populations and address the needs of those not in care and of historically underserved populations, not merely current CARE Act clients.
• CARE Act planning bodies are official decision-making entities. Their priority-setting and resource-allocation decisions are subject to public scrutiny and to grievance procedures. The process used to reach these decisions must therefore be public and fully documented in writing. Conflict of interest requirements must be fully addressed.
• While priority setting is the responsibility of the State, this may be delegated to a planning body. If a committee of a planning body is given lead responsibility, the entire planning body should make decisions about priorities and the allocation of resources among service categories.

Steps in Priority Setting and Resource Allocation TOP

The following 15 steps outline how to conduct priority setting and resource allocation and should be carried out over a period of several months, probably by committees and the full planning body.

For purposes of this document, priority setting and resource allocation are described as separate steps, carried out in sequence by a special committee and the full planning body. Two different committees might also be used, or the two processes might be combined. Each planning body should view the steps provided as one example of a sound process and should feel free to adopt or adapt it as appropriate, given their unique circumstances.

1. Agree on the priority-setting and resource-allocation process and its desired outcome.  TOP

First, agree on the specific tasks to be carried out and the expected outcomes. Usually the tasks will be decision making to set priorities and allocate resources to those priorities and provide guidance on how best to meet each priority. Priorities may include Direct Services and Program Support (e.g., capacity development, outcomes evaluation).

In setting the tasks and desired outcomes, agree on a format and level of detail for the completed priorities and resource allocations. In doing so, look back to the previous year and identify any changes or improvements needed in the service categories to be considered or the level of detail to be specified. For example, the following specific outcomes might be selected:

• A prioritized list of service categories, including a description of populations that will be served, geographic areas in which services are delivered, or service models that will be used to provide these services
• A chart showing the percent or dollars to be allocated to each service category or subcategory (see step 10), and
• A fully documented description of the steps and decision-making processes used, which can be shared with the community and used to support decisions.

Each step in the planning and decision-making process should be documented. Use the following outline as a starting point. Such documentation will make it clear at the end of the process how decisions were made.

2. Agree on responsibilities for carrying out the decision-making process.  TOP

Next, decide who will be responsible for carrying out various steps. While final decisions should be made by the State or its designee (e.g., a full planning body), preliminary work can be delegated to a special committee If a committee approach is chosen, ensure that the committee:

Is large and diverse enough to reflect the various population groups and types of technical skills and experience needed for an inclusive and sound process (a committee of 11-15 people is typical)

Documents its work and brings process decisions such as proposed procedures and criteria for decision making to the full planning body for review and approval (see below), and

Returns to the entire planning body for review of its preliminary work and receives participation from the entire planning body in determining priorities and/or resource allocations.

A useful activity is to identify the "stakeholders" who should be involved in priority setting and resource allocation, such as:

• A broad spectrum of the HIV-infected population, including specific groups (consider how to involve not only planning body members and current CARE Act clients but also the broader community of PLWH)
• HIV-affected community
• Providers
• CEO (chief elected official) and legislative representatives
• Health department or similar agency
• Affected subpopulations and historically underserved populations, reflecting the epidemiology of HIV/AIDS in the area
• People from specific geographic areas within the service area, and
• Other interested groups and individuals.

If a committee is used to coordinate decision making, consider including representatives of these stakeholders as members. It may be useful and is entirely appropriate to involve in committee work individuals who are not members of the overall planning body. Where funds or volunteer services are available, consider using the services of a professional facilitator for this committee.

3. Review relevant legislative requirements and guidances.  TOP

The group responsible for coordinating the priority setting and resource allocations process should review legislative requirements and HAB/DSS guidances to ensure that the decision-making process is compatible with them. For example, the process needs to:

• Base priorities on the size and demographics of the population of individuals living with HIV disease, needs of individuals who are not in care, disparities in access and services, the priorities of communities with HIV disease, and coordination with HIV prevention and substance abuse prevention and treatment programs
• Comply with HAB/DSS guidance regarding funding of non-service priorities, and
• Adhere to conflict of interest policies (State, local and Federal CARE Act requirements).

Because CARE Act policies may change over time, planning bodies should consult the most recent application guidances from HAB/DSS to identify other legislative factors and HAB/DSS expectations. Information obtained should be summarized in writing and used in deciding on a decision-making process and criteria.

4. Determine and obtain available information "inputs," including comprehensive plans and needs assessments.  TOP

Ideally, most or all of the information listed in the table below will be available as “inputs” to decision making. This information will help in making decisions about service priorities and resource allocations. HAB/DSS does not expect all of these data components to be used, but many States have found that using a combination of data provides the best results.

Checklist of Data/Information for Priority Setting and Resource Allocation

Identify missing information before priority setting begins to avoid conflict over any limitations in the process caused by a lack of data. Identifying information gaps will also help to improve the information inputs for next year's decision making.

Often, the information listed will be available but not in an easily usable form. For example, the needs assessment may be quite lengthy. An important task is to determine the kinds of information needed from each of these inputs and prepare summaries in narrative or chart form for use in decision making. For example:

• Needs assessment information might be summarized to provide a prioritized list of service needs as identified by the various needs assessment activities.
• Non-CARE Act funding might be presented in terms of dollars available for each service category, broken down by service model, target group, and/or geographic location where available.

 5. Identify a list of service categories for consideration, including definitions, components, and how best to deliver each service.  TOP

HAB/DSS provides a list of HIV-related service categories and definitions that indicate what services may be funded under specific titles of the CARE Act.[1] Prioritized services should be consistent with this list. Those that fall outside these areas (in cases where the State has other service lists and definitions) may be included, provided they are in compliance with existing HAB/DSS policies on allowable services.

Because different terms are sometimes used to describe similar services, and certain activities can be provided in more than one service category, a consistent listing can greatly simplify discussions about needs and priorities. For example, in some service areas, client advocacy is considered a part of case management, while in other locations it is a separate service category or is included in various program areas (e.g., housing services staff provide client advocacy on housing services, while personnel within medical clinics provide client advocacy on health care).

Following are helpful steps in defining the service categories:

• Review the approved list of service categories and definitions provided by HAB/DSS in its annual application guidance.
• Review the list used last year in presenting service priorities.
• Consider components and delivery mechanisms that are important to your continuum of care. They may need to be separately identified for consideration in priority setting and resource allocation. These might include:
  • Types of service interventions (e.g., the category of Food Bank/Home Delivered Meals/Nutrition Services might include home-delivered meals, food banks or food pantries, and food vouchers and nutritional supplements).
  • Specific subpopulations who must be served (e.g., women, gay men of color, homeless, injecting drug users, Latinos, African Americans).
  • Specific geographic areas (e.g., the major cities or counties included in the service area).
  • Types of organizations that might deliver the services. Priority setting might stipulate what provider characteristics should be looked in the RFP that is issued for funding of service providers. However, selection of particular providers/agencies that should deliver a given service must be left to the contracting process.

Remember that the service categories should be listed so they illustrate options for consideration in meeting documented needs. For each HIV health care need identified, choose the service interventions that work best in your area. For example, your needs assessment might indicate that PLWH need to have their care coordinated. This might be accomplished through case management or through some other service intervention. Once a list of service categories and interventions is developed, the committee should provide it to the full planning body for review and approval. The box suggests two ways to approach defining service categories.

6. Agree on principles to be applied in decision making.  TOP

Sound priority setting must be based on principles and criteria for decision making, which must be clearly stated and consistently applied. A first step is to identify—and obtain any needed review and approval of—the principles that will be used in guiding the decision-making process (see examples below.) Often, such principles have been discussed and reflected in the area's comprehensive HIV services plan. In making decisions about priorities, the decision-making body should consider whether proposed priorities are consistent with these principles.

Sometimes documentation may not exist to apply all these principles. For example, cost-effectiveness and outcome-effectiveness data may not be available. Note how the lack of information limits the quality of decision making and specify additional information needed in future years.

7. Determine the criteria to be used in priority setting.  TOP

In addition to principles, agree on the criteria to be used in setting priorities. These criteria should be "weighted" to determine which ones are most important in making decisions. Suggest a limited number of criteria and indicate which are most important. The box below provides sample criteria.

An experienced planning body with extensive information "inputs" may want to add more criteria, based on the principles agreed upon in Step 6. The criteria and their relative weight should be discussed and agreed upon by the full planning body.

Note that these sample criteria do not include financial considerations, such as availability of other funding streams or unmet demand. This priority-setting model assumes that priorities will reflect judgment concerning needed services to provide a continuum of care, regardless of how these services are being funded and the extent of unmet demand for these services. Funding availability and unmet needs associated with these service priorities are considered in Step 12, as part of the resource allocation process.

In establishing service priorities, consideration of the availability of other funding and the extent of unmet service needs is required. Review suggested procedures and charts in Step 12 before deciding on the criteria to be used in priority setting.

8. Determine the decision-making process to be used. TOP

Once all the prior steps have been completed, principles and criteria for decision making will have been adopted, and arrangements will have been made to obtain summaries of available information "inputs" for review during the decision-making process.

The recommended decision making-process should be reviewed and revised as needed. There is no one decision-making process or method for priority setting. However, the considerations described below, reflecting the experience of several planning bodies, can help develop a practical method.

As noted earlier, some planning bodies may want to combine the priority setting and resource allocation processes. However, if a committee is doing the preliminary work, it is generally better for the entire planning body to review and approve the service priorities before the committee begins to allocate resources to them. This ensures careful planning body attention to both responsibilities and prevents the committee from having to redo the allocations process if the planning body makes significant changes to the service priorities.

Issues to Consider in Defining the Priority-Setting Process 

Consider the following issues in defining a decision-making process:

• Openness of Process. All decisions should be made in an open forum, whether by a committee or full planning body. The public might not be asked to participate in the decision making but should be free to observe it. Therefore, a calendar of meetings should be agreed upon and publicized within the community, and all decision-making meetings should be held in large and accessible locations and at scheduled times designed to encourage community attendance. A planning body serving a large geographic area might hold meetings in several different locations.
• Information Base for Decision Making. Documented information in the form of summaries of the needs assessment and other information inputs should be made available to everyone through a single "point person," such as a committee member or staff member. All members should have access to the same information and be able to request full copies of documents if desired. Training or other assistance should be provided to members less familiar with the CARE Act so they will feel comfortable using the information.
• Quorum Requirements. Explicit quorum requirements should exist for the committee and the full planning body.
• Minimizing Conflict of Interest. The decision-making process may create temptations for members to advocate narrowly for service categories or for interventions for populations and/or geographic areas served by a member's agency (public or private). The committee and full planning body should define conflict of interest and establish mechanisms to minimize it. This is particularly important because many planning bodies have a high proportion of members who are service providers. Mechanisms might include:
  • Full disclosure of relationships with HIV/AIDS service providers and the types of services they provide
  • Allow members with potential conflicts to participate in discussions but not vote
  • Limit participation in discussion to service categories where there is no potential conflict of interest.
  • Exclude providers with potential conflicts of interest from serving on the Priority-setting Committee or ensure that individuals with a potential conflict constitute a minority on the committee.
  • Begin each meeting by reminding members of the mission of the planning body and the purpose and importance of priority-setting.
  • The challenge is to manage conflict of interest without excluding from the discussion those with needed service knowledge and experience.
  • Voting Procedures. Voting procedures should be agreed upon in advance and approved by the full planning body.
• Decision-making Method. The procedure to be used in making decisions should be specified "up front." Examples include a consensus method, a nominal group process, or some other procedure. Several of these methods are described below.[2]

• Leadership. The planning body should decide who will lead the decision-making process. Co-chairs might provide leadership to ensure that everyone is heard, the agreed-upon process is followed, and time limits are placed on discussion.
• Decision-making Responsibility. Responsibilities of the committee and the full planning body should be defined. The committee might begin by reviewing its definition of the task and planned outcomes, as decided in Step 1 of this process, and the agreed-upon responsibilities of the committee and full planning body, as decided in Step 2.
  • Committee Responsibilities. The committee might be charged with developing an initial list of recommended priorities. Its responsibility might include presentation of summary information documenting needs, discussion of identified needs and service interventions to best meet these needs, and time-limited discussion of recommended priorities. The committee might also discuss and recommend planning body support and program support activities that require funding (such as needs assessment, comprehensive planning, outcomes evaluation, and/or development of clinical protocols).
  • Full Planning Body Responsibilities. If delegated by the State, the full planning body is responsible for approving priorities. If preliminary work is done by a committee, the planning body should review their recommendations and adjust them to reflect the consensus of the full body, resolving any areas of disagreement.
• Meeting Schedule. Meetings necessary to carry out the process should be scheduled in advance and publicized.
  • The first committee meeting might be held after the planning body has approved a decision-making process, to review the process, criteria, and information "inputs" and train participants on the decision-making method.
  • The committee might then hold a second meeting, or more as needed, at which it will implement the priority-setting process and be prepared to recommend service priorities to the full planning body.
  • The last meeting might include the entire planning body. The committee would recommend and the planning body review and revise suggested priorities, and agree on a final list of service priorities.

9. Implement the process: set service priorities, including how best to meet them. TOP

Once the planning body has adopted a priority-setting process, including an agreed-upon method to make decisions, implement the priority-setting process, with staff support where available. Following is a detailed case study example of how one planning body carries out the decision-making meetings and follow up, involving both a preliminary priority-setting meeting of a committee and a final priority-setting meeting of the full planning body.

10. Define the scope of the resource-allocation process. TOP

If the planning body is responsible for resource allocations as well as priority setting, it should now define the scope of this activity. The extent of the effort depends upon the planning body's scope of responsibility. Some planning bodies are responsible for allocating funds from one CARE Act title, while other handle multiple sources, such as Title I, Title II, and HOPWA (Housing Opportunities for People With AIDS) funds.

Step 1 identified typical outcomes for the priority-setting and resource-allocation task. The desired outcome of the resource-allocation process is typically a chart showing the percent or dollars to be allocated to each service category or subcategory. To reach this outcome, the resource-allocation process typically requires the following activities:

• Specify the sources and categories of funds to be allocated.
• Use the results of the priority-setting process to specify the functions to which funds may be allocated (priority service categories, Planning Body Support, and Program Support activities).
• Determine funding gaps for prioritized services by reviewing the sources and amounts
  of funding allocated by other sources to support particular services. This will enable the planning body to determine if there is a funding gap to which it should respond (See Step #12 for methods for determining unmet service needs and funding gaps).
• Project the expected amount of funding (or minimum and maximum funding levels) from each source that must be allocated.
• Allocate a specific number of dollars or a percent of the total available funding from each specified source to the service categories and non-direct-service functions.

Present the results of the resource allocations task in summary form. This might mean preparing a chart indicating service priorities and resource allocations to each of those services—in terms of dollars or percent of funds—with a separate column for each funding stream for which the planning body is responsible. The format for presenting the completed task might be as shown in the sample Priorities and Resource-Allocations Chart at the end of Step 13. Additional columns would be needed for each additional funding source. An additional column might also be used to show the dollars allocated to each service category and subcategory, in addition to the percent of funds.

Generally, resource allocations will need to be completed before final figures are available on funding. Therefore, allocations can be based on various funding assumptions, such as:

• Funding will be unchanged from the prior year
• Funding will be a specified percent - such as 5% or 10% - below the prior year, or
• Funding will be a specified percent - such as 5% or 10% - above the prior year.

Or, allocations can be based on an expected minimum level of funding, with information about how additional funds will be allocated, as in the first scenario described in Step 13.

11. Agree on the principles, criteria, decision-making process, and methods to be used in allocating funds to service categories.  TOP

Factors to use in resource allocation are usually similar to those used for priority setting, with some refinements. The principles and criteria used for priority setting should modified as needed for use in the allocations process. If a committee is delegated responsibility for recommending resource allocations to the full planning body, the committee should recommend, and the planning body should review and approve, these factors.

Regarding principles, the planning body might want to add the following, which reflect CARE Act requirements:

• The CARE Act will be considered the funder of last resort.
• The CARE Act will not be able to meet all identified needs.

Regarding criteria, the planning body might want to add the following:

• Lack of other funds. Resources from other sources are not available to meet this service need.
• Cost-benefit. The service provides a high level of benefit for PLWH relative to its cost.

Regarding the decision-making process, many issues need to be considered. If the planning body uses a committee process to set priorities, it can use the same committee to do the resource allocations, including the same attention to scheduling and publicizing meetings and ensuring open forums. The complexity of the resource-allocation process makes especially important a committee process—supported by staff work and followed by review and decision making at a full planning body meeting.

As with priority setting, the committee should recommend the process to the planning body, and the planning body should review and approve it. Many of the considerations are identical to those identified in Step 8; some additional considerations are described below.

 12. Estimate needs by service category.  TOP

Thoughtful resource allocations depends upon the amount and quality of information available on:

• The need and demand for specific services
• The costs of those services

• As explained in Step 7, some planning bodies consider unmet service needs, including financial requirements to meet these needs, in setting their priorities. If your planning body uses this approach, you may already have compiled the information described below by the time you begin the resource-allocation process. If so, make sure the materials described below are available for review as you determine resource allocations.

• The availability of other resources to support them

• Several of your analyses will require an inventory of the sources and levels of other governmental and nongovernmental resources available to support AIDS services in your community. Such information is also necessary to assess and, to the extent possible, quantify gaps in services. This inventory may be a part of your needs assessment.

• Capacity development needs of providers.

The planning body should gather available information by service category. If information is available only for some types of services, use what is available and identify information gaps. It is particularly helpful to prepare charts that list service priorities in order and provide information needed for the allocations process. Examples of particularly useful analyses and charts follow.

Prepare a comparison of the service priorities for the upcoming year with the priorities and allocations identified for the current year.

The chart format might look like this:

Service Priorities Comparison

Obtain information on the units of service provided and the costs per unit of service or per client for the service categories or components within them. The most easily obtainable information might be the number of clients served in a year and the estimated costs per client per year. Your chart might look like this:

Services and Costs

If available, provide a more extensive analysis of your current year funding levels. For example, did funds for certain services (e.g., emergency financial assistance) run out before the end of the year, or were funds reallocated because of under-expenditure or low demand? Obtain the grantee’s or administrative agent's projection of unspent funds for each service category. If this information is available, make it a separate column on your chart.

Estimate current service gaps in terms of unmet service need by priority. For example, given the current funding situation, estimate the number of PLWH who are not receiving primary care, case management, etc., and are in need of such services. If possible, provide this information by service priority, and estimate the costs for meeting that need. Review unit costs for the past year, and modify as needed to project for next year. Use a format such as the following:

Unmet Service Needs and Cost Estimates

Prepare a combined chart of estimated total needs by service priority, both met and unmet, and available funding. Using the format shown in the chart below, include the following:

• Service priorities, including specific components like subpopulations and geographic area needs (Column 1).
• Total need (including met and unmet need), in terms of either number of clients or service units (as shown in Column 2).
• Average cost per client estimated for the next year (Column 3).
• Total funds required to meet the need (Column 4).
• Identification of other available funds to meet service needs, by service priority (Column 5).
• The level of unmet need by service category (Column 6), which is the difference between total funds required to meet the need (Column 4) and other available funds (Column 5).
  
  The chart might look like the following:

Estimated Service Needs

Once you have prepared this information, you are ready to carry out your agreed-upon resource-allocation process.

 13. Allocate resources to service categories.  TOP

To allocate resources to established priorities, you will probably need one or two meetings to agree upon and review the principles, criteria, and processes described in Step 11, and to develop and review the information described in Step 12. The allocations process might then proceed to the development of alternative scenarios or funding formulas. Based on the Step 12 information charts, you can develop alternative scenarios or allocation formulas for the committee's review. Following are four possible resource-allocation scenarios:

Sample Scenarios for Use in Resource Allocations

Scenario #1

Divide priorities into tiers of services and other activities, as follows:

• First-tier categories that are considered "core" or "essential" services
• Second-tier priorities that should be funded if funds permit, and
• Third-tier categories that should not receive funding this year.

Determine what is likely to be the minimum amount of funding received. First allocate the funds needed to ensure continuation of first-tier services at the same funding level as the current year, if continued funding is needed. Once these core services have received level funding, allocate a specified proportion of additional expected funds (e.g., 60 percent) to all second-tier categories, so that they all receive the same percentage of the previous year's funding level. Use the remaining proportion of funds (e.g., 40 percent) to expand funding for first-tier categories towards the estimated total need. If funding is higher than projected, use the same allocations procedure (e.g., 60-40) to fund first-tier and second-tier categories.

Scenario #2 

Continue to fund all existing services but at a specified percent reduction (e.g., 11 percent cuts across the board) to generate a pool of $X dollars for allocation to new service priorities (e.g., drug reimbursements, viral load testing, substance abuse treatment for women, and family-centered case management for Spanish-speaking PLWH). If next year's funding level were higher or lower than expected, increased funds might be allocated proportionately to current and new services, or cuts applied equally to all services.

Scenario #3 

Continue to fund at the same level those services with high priority rankings, or those identified in the continuum of care as essential to life or essential to providing access to care. Cut other services by a specified percent (e.g., 3 percent; use the pool of funds created by the cuts to fund new priorities or unmet components of high-priority service categories (e.g., substance abuse treatment services for women, case management services for Spanish-speaking PLWH, ambulatory medical care in an outlying county). If the funding level is higher than expected, a set percentage of increased funds might go to new services, high-priority existing services, and lower-priority existing services. If the funding level is lower, a set percentage in cuts might be applied across all services.

Scenario #4 

Divide services into tiers as in Scenario #1. Continue to fund existing services in first and second tier but decrease funding levels for second-tier services. Base these reductions on a careful review to identify services that are lower in priority, level of unmet need, and/or availability of other resources. Make sufficient cuts to generate a pool of $X dollars to allocate to new service priorities and to increase allocations to specific components within high-priority services which have high levels of unmet need and low availability of other resources.

 In all these scenarios, because the planning body does not consider resource availability in the priority-setting process, the highest-priority service within the EMA is not always the service that receives the highest allocation of resources. The highest-priority service may cost less than other services and/or other non-CARE Act resources may be available to fund it.[4] A planning body might, for example, identify outpatient primary health care as its top service priority, but allocate little or no CARE Act funding to the service category if funds were available from other sources. Similarly, a service category that was relatively lower priority but was not funded through other available funding streams might be allocated a large proportion of CARE Act funds. This approach to priority setting and resource allocation has the advantage that it applies regardless of changes in other funding streams. For example, if severe cuts were to occur in funding for outpatient primary health care, the planning body might want to reallocate some of its resources, but would not need to change its priorities. Similarly, if the demand for medications grew beyond the State ADAP’s capacity to meet it, a planning body might choose to allocate additional funds for medications rather than other services.

Resource allocations are finalized at a full planning body meeting. As with the draft service priorities, the committee presents and justifies recommended resource allocations at an open meeting. Principles, criteria, needs and resource data, and the selected scenario are also presented and discussed. The full planning body reviews the entire process, especially the selected scenario and its rationale, and suggests modifications if needed, based on the criteria and the needs and resource information. The planning body either reaches consensus on the resource allocations, or adopts them through a formal vote.

Staff document the resource-allocation process along with the priority-setting process and results (See Step 1 for a sample format for documentation). Once this process is completed, the results of priorities and funding allocations are summarized, as in the table below.

Service Priorities and Funding Allocations

These priority-setting and resource-allocation decisions are reported to the community. The planning body publicizes its decisions through public hearings or meetings in several locations.

14. Provide decisions to the grantee or administrative agent for use in procurement. TOP

The planning body must provide the grantee or administrative agent with the results of the priority-setting and resource-allocation process as a basis for the selection of providers (the procurement process). The planning body's priorities will reflect specific population groups, geographic areas, and service delivery mechanisms.

15. Identify areas of uncertainty and needed improvement. TOP

Once the entire process has been completed for the year, the committee and the full planning body should review the experience and identify ways to improve the process in future years. A designated group should:

• Identify missing or incomplete information that affected decision making, with emphasis on new legislative requirements or guidelines
• Consider how the allocations for non-service activities such as Program Support, as well as other initiatives that may not involve additional funds, could improve the amount and quality of information "inputs" for the following year
• Review the decision-making process for weaknesses or problems and seek solutions, with special attention to any aspects of the process that might make the planning body vulnerable to a grievance
• Review how conflict of interest was managed, and whether additional efforts are required, and
• Make recommendations and plans for improvement, then assign responsibility for follow up to be sure they are carried out.

 References TOP 

This chapter is an update of Priority Setting and Resource Allocation, a HAB/DSS technical assistance guide published in 1998.

[1] See the Appendix for a list of service categories that may be funded under Title II.

[2] For more information on decision-making methods, see the Training Guide: Preparing Planning Body Members.

[3] See Conflict of Interest and Planning Body Duties chapters in this manual.

[4] See also the section on Planning Body Duties in this manual.