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Trump policy capping NIH indirect costs at 15% will cripple biomedical research

Discussion in 'Too Hot for Swamp Gas' started by mfran70, Feb 7, 2025.

  1. mfran70

    mfran70 VIP Member

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    NOT-OD-25-068: Supplemental Guidance to the 2024 NIH Grants Policy Statement: Indirect Cost Rates
    This will absolutely cripple academic research. The vast majority of health care research at public institutions is funded by NIH. Direct costs go to support the research while indirect costs go to support the infrastructure at the University that the research relies on. Think building maintenance, support staff etc. Most major research universities have indirect cost rates 50-60% of the amount of direct costs on any grant. For example, the IDC rate at UF is 52.5%. This policy immediately cuts the IDC rate to 15% across the board. This is a loss of millions of dollars that institutions have already budgeted. Many people at our public universities will lose their jobs if this policy stays in place. All so the mega-rich can get a tax cut to get even richer. Sickening.
     
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  2. gator_jo

    gator_jo GC Hall of Fame

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    Trump doesn't care about any of this. Neither does Elon. But their tax cuts are on the way!
     
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  3. thomadm

    thomadm VIP Member

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    If this is all political, what happens when Dems take back the house, Senate and Presidency?

    This is a sugar high for the pubs, but they are going to regret it soon, just like the Dems are regretting trumping BS charges on Trump. Revenge is a b****.
     
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  4. slayerxing

    slayerxing GC Hall of Fame

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    That is catastrophic for research. Wow. I know most outside higher Ed won’t understand this but this is a disaster - and before you celebrate understand that it’s not just higher Ed that will suffer. So many people do research on grants then that work rolls into the private sector. This is a huge disruption to all of that.
     
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  5. okeechobee

    okeechobee GC Hall of Fame

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    Yeah. Bummer.
     
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  6. slayerxing

    slayerxing GC Hall of Fame

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    I assume there will be legal challenges. NIH usually has to put out a call for comment or negotiated rule making of something before doing this. I’m also reading it’s retroactive which breaches active contracts. Doubt this sticks. Hope it doesn’t as it’s a disaster for everyone - especially here in Florida where there is a huge economy around medical research.
     
  7. mdgator05

    mdgator05 Premium Member

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    Who needs medical research? I suggest that we get people who have watched a Youtube video to handle all medical treatments from now on.
     
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  8. Emmitto

    Emmitto VIP Member

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    But if you are wealthy, won’t you be able to access this verboten magic?
     
  9. OklahomaGator

    OklahomaGator Jedi Administrator Moderator VIP Member

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    If using your example, the University of Florida has an IDC rate of 52.5%, but are now limited to only charging 15%, doesn't that free up another 37.5% of the grant money for direct costs, which would include more staff doing the research? Aren't you taking it out of the right pocket and putting it in the left pocket? But you are getting more research?
     
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  10. G8trGr8t

    G8trGr8t Premium Member

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    the only silver lining is hopefully a lot of MAGA voters are getting their ox gored too

    if this bs goes through, the amount of damage this man and his muskettes are doing to this country is tantamount to warfare against the citizens of this country
     
  11. mdgator05

    mdgator05 Premium Member

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    No. You need to pay for facilities. For example, the staff can't pay for electricity to spin a centrifuge. They can't pay for laboratory space out of pocket. They can't pay for the computing power needed for many modern research projects. They can't pay for access to libraries and for compliance with safety and legal concerns.

    Basically, if this actually sticks (I doubt it does), it would push every medical researcher into other countries.
     
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  12. G8trGr8t

    G8trGr8t Premium Member

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    15% isn't nearly enough to cover the hard costs and support personnel associated with the research that gets covered under the OH. those buildings aren't cheap to build or maintain and it takes a lot of staff to keep it running. our indirect costs for an engineering and survey company are in the 45 - 50% of our costs and our infrastructure isn't nearly as complicated as a hospital. without the indirect funds to keep the lights on, there will not be anywhere to do the research

    like almost everythign else like this, ajudge is going to stop this too

    once all hsi cuts are tied up in the courts, they will attack the judicial branch as inhibiting making america hate again
     
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  13. OklahomaGator

    OklahomaGator Jedi Administrator Moderator VIP Member

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    How much should nonprofits spend on overhead? | 501(c) Services

    Well, if Universities want to receive donations from people who donate to charities they need to get their OH costs in line. Granted the 25% number is over the 15% number cited above but it does say "less than 25%".

    As to some of your other points, those buildings have already been built on the taxpayers dime. They have to maintain them whether there is research there or not.

    It will turn into a competitive marketplace, (it already is but now there is a new dynamic) if F$U says they can't apply for the grant because their OH is too high, you can bet UF would jump in and say they could do it.
     
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  14. mdgator05

    mdgator05 Premium Member

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    You are comparing apples and suspension bridges here. The "overhead" component of a standard charity is not even vaguely the same thing as indirect costs of research.

    No, that is not how this works either. This isn't for janitorial services and building maintenance. And no, the medical facilities are generally not paid for with taxpayers expenses. Most of the facilities budgets for even state schools (not even bringing up that much of this research is done at private institutions) comes in the form of grants and loans, much of which against future revenue from...medical research.

    You can bet none of them will because they won't have the equipment and facilities that they need. Instead, it will go to a country that isn't run stupidly.

    If you want to actually understand the topic, here is a quick summary:

    https://www.aamc.org/what-we-do/mission-areas/medical-research/facilities-administrative-costs
     
    Last edited: Feb 8, 2025
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  15. OklahomaGator

    OklahomaGator Jedi Administrator Moderator VIP Member

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    The first quote is from the OP, the second is your last post. Which way does it go?
     
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  16. mfran70

    mfran70 VIP Member

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    It will ultimately end high-level academic research at R1 institutions. The indirects are used to support buildings and research infrastructure that is not otherwise supported. The other income stream is undergrad tuition. Perhaps universities will offset costs by dramatically raising tuition but I think this is unlikely.
    The amount of money universities receive from foundations is miniscule compared to NIH support, so the argument about indirects on foundation awards is kind of irrelevant. These awards mostly serve to supplement and expand NIH-supported research programs, but are not large enough to sustain them on their own.
    Your other point about freeing up money still does not address the cost of research support. Costs of water, electricity, secretarial support, biohazard waste etc. will all have to be shifted to direct costs. The total cost of performing research will be the same.
     
  17. mdgator05

    mdgator05 Premium Member

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    "Etc." is a pretty key element of that sentence. Building maintenance is a part of it. Support staff is a part of it. But there is a lot covered in the "etc." Support equipment, computing power, utilities, safety equipment, safety procedures, patient monitoring and safety, and that much longer list doesn't include all of it, so etc.
     
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  18. OklahomaGator

    OklahomaGator Jedi Administrator Moderator VIP Member

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    I don't want you to think I am against University research, totally the opposite, but I think the universities need to look into this.

    I'm old enough to have been involved with a hospital when medicare reimbursement was cost based (prior to 1997 I believe) and the hospitals would put everything they could think of into their cost structure to maximize their reimbursement. Medicare changed to a diagnosis based reimbursement (DRG was the term I think at the time) and it forced hospitals to become more efficient in their delivery of services. I would wager if you dig into that 52% number you will find charges for stuff that has nothing to do with the grant. 5% of the secretarial time for the President might be an example.

    52% for overhead seems excessive to me, and back to my original point, if you only spend 25% on overhead, that is another 27% you can hire a grad student to do more research, giving the organization that gave the grant more bang for their buck.

    Reforming Medicare Payment: Early Effects of the 1997 Balanced Budget Act on Postacute Care - PMC
     
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  19. mfran70

    mfran70 VIP Member

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    Perhaps there may be ways to cut overhead with proper planning. I don’t know. This cuts current indirects by more than3-fold instantaneously. These budgets are already set. The only way to satisfy the cuts in the short term will be to cut jobs.

    Your scenario assumes the difference is directed back into science. DOGE sees it as waste that should be returned to taxpayers, likely to very wealthy taxpayers.
     
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  20. OklahomaGator

    OklahomaGator Jedi Administrator Moderator VIP Member

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    We will have to agree to disagree here, but if the grant is for $100,000 and the university can only allocate $15,000 to overhead, that leave $85,000 for direct costs. That seems like a win for the researchers.
     
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