The CDC faces $1.5 billion in budget cuts. Layoffs will almost certainly follow

The nation’s health faces a dual threat — one anticipated, the other, self-inflicted.

Covid-19 has not gone away; the Centers for Disease Control and Prevention reports that infections are showing signs of a late summer wave. The new strain, EG.5, spreads easily and is more resistant to neutralizing antibodies but does not, to date, seem to be more virulent.

The second threat does not take the form of a new pathogen. Rather it’s an attack on the CDC itself. Budget cuts imposed by the July debt ceiling negotiations will cripple this flawed but vital agency. According to the Congressional Budget Office, the CDC faces a 10% budget reduction equaling $1.5 billion in cuts.

A source told us that the reorganization plan for the already struggling agency began on Aug. 14 with shifts in staffing. That will be followed by administration shifts on Oct. 1. (As of Aug. 21 nothing about a reorganization plan has yet been published.) The plan began under the administration of Rochelle Walensky and will continue under the new CDC director, Mandy Cohen. Cohen comes to the directorship from her position as executive vice president of the venture capital-backed startup Aledade Care Solutions, an accountable care organization for primary care doctors.

As with any organization, the CDC’s highest cost is in staffing. Based on her experience at Aledade, Cohen knows that the best way to achieve better efficiency is to reduce overhead. Her first target will likely take the form of staff reduction. When asked directly by STAT’s Helen Branswell in late July about the need for staff layoffs to meet the demands of budget cuts, Cohen was evasive.

Most of the CDC’s 15,000 personnel are employed through the Federal Civil Service System. Employees tell us that the agency has assured them that this necessary reorganization (“workforce reshaping” in government jargon) would improve efficiency and productivity and that no one would lose their job, position, or salary.

But based on our private sector experience in similar situations, it isn’t clear if it’s even possible for the CDC to deliver on that promise and still cut its budget by 10%.

Initial employee reduction will come from attrition. Once vacated, the positions will not be filled, leaving a Swiss cheese pattern of staffing. If the attrition rate is not high enough to meet target numbers, more aggressive terminations will surely follow.

Lower-level staff are understandably anxious because of the many unknowns of reorganization.

What few realize is that more than three-quarters of the CDC budget goes to the states and contract research organizations in the form of public health and prevention activities by state and local health organizations and agencies, national public health partners, and academic institutions. Among the many tasks undertaken by the CDC are those for surveillance, detection and mitigation of diseases ranging from sexually transmitted infections such as syphilis, chlamydia, gonorrhea, and trichomoniasis to viral pathogens like those causing influenza, SARS, MERS, Ebola and Covid-19.

One glaring example of why there is a need for more, not less, CDC public health services is Mississippi’s 900% increase in cases of congenital syphilis over the past six years. Congenital syphilis is associated with the rapid rise in the number of stillbirths and infant deaths, both directly attributable to inadequate prenatal health care. If the CDC is unable to meet the current demands for controlling a well-studied disease like syphilis with current budget resources, it will be woefully unable to prepare for, much less deal with, the next vector or food-borne illness. It is not a question of whether such an illness will occur; it is simply a question of when.

In addition to its staff employees, the CDC relies on approximately 6,000 contractors. The five major categories of government contractual procurement are construction, supplies and materials, professional services, information technology, and transportation. Contractors deliver everything from paper clips to medications. With fewer contractors, supply chain disruption will be inevitable. Cuts to their ranks will likely occur earlier than staff cuts because contractors act independently and are not considered government employees.

Cutting the CDC budget sends a message that will weaken the already anemic private sector willingness to invest in health care. If the U.S. government is cutting its investment in health care, why shouldn’t the private sector do the same?

The effect will likely result in curtailment or elimination of many private sector research projects and will make prospects for new research dire. The cuts come at a time when biotechnology and big pharma are already experiencing a steep downturn in both investment and hiring in research for new diagnostics and therapeutics. This compounding effect of decreased federal funding and disinterest in private sector funding is a formula for scientific regression not seen in decades. The toll on the researchers and innovators will be devastating.

The CDC is a repository for health care data reported by each state. It is that data that provides the basis for public health recommendations and expenditures. Reducing the CDC budget will translate to fewer staff at the state and local levels and will lead to inconsistent or absent data reporting. The existing system is so antiquated that some health care data is still reported to the CDC via fax. In short, cuts will make upgrading the nation’s vital health care communication infrastructure purely aspirational.

If we have learned anything from the current pandemic it is the importance of surveillance, detection and mitigation. Cutting the budgets for these critical health care programs is not only unwise, but also dangerous. Success in pandemic preparedness and response depends on surveillance and detection. It is essential to identify and locate a problem organism before the agent has a chance to become established in the population. It is well known that surveillance and detection work from experience with Ebola. That highly lethal infection was identified and contained early, thus preventing widespread devastation.

Cutting the CDC budget will remove all hope of critical support for development of new diagnostics and therapeutics affecting a litany of maladies including obesity, chronic disease, injury, and violence prevention. Americans cannot afford to be less prepared for current and future health challenges. Increased efficiency and productivity are always welcome, but not at the expense of America’s health.

Steve Brozak, DMH, is the managing partner and CEO of WBB Securities LLC and the founder of the WBB Research Institute. Richard Marfuggi, M.D., DMH, is a surgeon, medical director of the WBB Research Institute, and member of the New Jersey State Biomedical Ethics Committee.