The 1996 amendments required the use of ELCs  instead of cumulative AIDS cases. Table 1 describes CARE Act formula grants for  Titles I and II. They also required that HIV  data be used no later than the beginning of fiscal year 2007. Multiple CARE Act Provisions Contribute to Disproportionate Funding per AIDS Case

Provisions in the CARE Act funding formulas result in a distribution of  funds among grantees that does not reflect the relative distribution of  AIDS cases in these jurisdictions. We found that provisions affect the  proportional allocation of funding as follows: (1) the AIDS case-count  provisions in the CARE Act result in a distribution of funding that is not  reflective of the distribution of persons living with AIDS, (2) CARE Act  provisions related to metropolitan areas result in variability in the  amounts of funding per ELC among grantees, and (3) the CARE Act hold- harmless provisions and grandfather clause protect the funding of certain  grantees. Provisions in CARE Act Funding Formulas Incorporate Measures of AIDS Cases That Do Not Reflect an Accurate Count of Persons Living with AIDS

Provisions in the CARE Act use measurements of AIDS cases that do not  reflect an accurate count of people currently living with AIDS. This  method for estimating cases was first included in the CARE Act  Amendments of 1996. CARE Act Funding Provisions for Metropolitan Areas Result in Disproportionate Funding

When total Title I and Title II funding is considered, states with EMAs and  Puerto Rico receive more funding per ELC than states without EMAs  because cases within EMAs are counted twice, once in connection with  Title I base grants and once for Title II base grants. The remaining 20 percent is based on the number of ELCs in  each jurisdiction outside of any EMA. The eligibility  of these EMAs was protected based on a CARE Act grandfather clause. Eight states  became eligible for this hold-harmless funding in fiscal year 2004. Funding Effect of Using HIV Case Counts Would Depend on Multiple Factors

CARE Act funding for Title I, Title II, and ADAP base grants would have  shifted among grantees if HIV case counts had been used with ELCs,  instead of ELCs alone, to allocate fiscal year 2004 formula grants. Grantees in the South and  Midwest would generally have received more funding if HIV cases were  used in funding formulas along with ELCs. However, there would have  been grantees that would have received increased funding and grantees  that would have received decreased funding in every region of the country. We found that those grantees that would receive  increased funding from the use of HIV cases tend to be those with the  oldest HIV case-reporting systems. Grantees with more mature HIV-reporting systems have  generally identified more of their HIV cases. We reported in February 2006 that if  Congress wishes CARE Act funding to more closely reflect the distribution  of persons living with AIDS, and to more closely reflect the distribution of  persons living with HIV/AIDS when HIV cases are incorporated into the  funding formulas, it should take the following five actions:  revising the funding formulas used to determine grantee eligibility and  grant amounts using a measure of living AIDS cases that does not include  deceased cases and reflects the longer lives of persons living with AIDS,    eliminating the counting of cases in EMAs for Title I base grants and again  for Title II base grants,    modifying the hold-harmless provisions for Title I, Title II, and ADAP base  grants to reduce the extent to which they prevent funding from shifting to  areas where the epidemic has been increasing,    modifying the Title I grandfather clause, which protects the eligibility of  metropolitan areas that no longer meet the eligibility criteria, and    eliminating the two-tiered structure of the Emerging Communities  program.
Why GAO Did This Study

The CARE Act, a federal effort to address the HIV/AIDS epidemic, is administered by HHS. The Act uses formulas based upon a grantee's number of AIDS cases to distribute funds to eligible metropolitan areas (EMA), states, and territories. The use of AIDS cases was prescribed because most jurisdictions tracked and reported only AIDS cases when the grant programs were established. HIV cases must be incorporated with AIDS cases in CARE Act formulas no later than fiscal year 2007. GAO was asked to discuss factors that affect the distribution of CARE Act funding. This testimony is based on HIV/AIDS: Changes Needed to Improve the Distribution of Ryan White CARE Act and Housing Funds, GAO-06-332 (Feb. 28, 2006). GAO discusses how specific funding-formula provisions contribute to funding differences among CARE Act grantees and what distribution differences could result from using HIV cases in CARE Act funding formulas.

What GAO Found

Multiple provisions in the CARE Act grant funding formulas as enacted result in funding not being comparable per AIDS case across grantees. First, the CARE Act uses measures of AIDS cases that do not accurately reflect the number of persons living with AIDS. For example, the statutory funding formulas require the use of cumulative AIDS case counts, which could include deceased cases. Second, CARE Act provisions related to metropolitan areas result in variability in the amounts of funding per AIDS case among grantees. For example, AIDS cases within EMAs are counted once for determining funding under Title I of the CARE Act for EMAs and again under Title II for determining funding for the states and territories in which those EMAs are located. As a result, states with EMAs receive more total funding per AIDS case than states without EMAs. Third, CARE Act hold-harmless provisions under Titles I and II and the grandfather clause for EMAs under Title I sustain funding and eligibility of CARE Act grantees on the basis of a previous year's measurements of the number of AIDS cases in these jurisdictions. For example, the CARE Act Title I hold-harmless provision results in one EMA continuing to have deceased AIDS cases factored into its allocation because its hold-harmless funding dates back to the mid-1990s when formula funding was based on a count of AIDS cases from the beginning of the epidemic. If HIV case counts had been incorporated along with the number of estimated living AIDS cases (ELC) in allocating fiscal year 2004 CARE Act grants instead of ELCs alone, funding would have shifted among jurisdictions. Grantees in the South and the Midwest generally would have received more funding if HIV cases were used in the funding formulas, but there would have been grantees that would have received increased funding and grantees that would have received decreased funding in every region of the country. Although CARE Act grantees have established HIV case-reporting systems, differences between these systems--in their maturity and reporting methods, for instance--would have affected the distribution of CARE Act funds based on ELCs and HIV case counts. Grantees with more mature HIV-reporting systems would tend to receive more funds.