RAND Study Finds Medical Schools Get 45 Percent of Federal Research and Development Funds Going to Higher Education

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FOR RELEASE
Tuesday
April 20, 2004

Medical schools received 45 percent of all federal research and development funds provided to U.S. colleges and universities in the 2002 fiscal year, according to a RAND Corporation study issued today that gives the most complete profile ever of how such funds are distributed.

The nation’s 126 medical schools received $9.6 billion of the $21.4 billion in federal research and development funds awarded in FY 2002 to the nearly 800 separate campuses of U.S. colleges and universities that received some federal research and development funding. There are more than 1,825 separate campuses of four-year accredited and professional degree-granting colleges and universities in the United States.

Federal investment in research and development at colleges and universities has grown considerably in recent years, increasing from $12.8 billion in FY 1996 to $21.4 billion in FY 2002 — a 67 percent jump in current dollars.

“Our analysis gives the first clear picture of how the nation spends its research and development money in the higher education sector,” said Donna Fossum, the report’s lead author. "With this information in hand, decisionmakers are in a better position to consider whether the overall allocation of funds to various substantive fields – which occurs agency by agency – is consistent with national priorities."

The Department of Health and Human Services (HHS) provided 67 percent — or two-thirds — of all federal funding that went to higher education institutions for research and development projects in FY 2002. That includes medical school and non-medical school research and development.

HHS has received sizeable funding increases in recent years, particularly for the National Institutes of Health. Even when HHS funding to medical schools was removed from the mix, the agency continued to be the major provider of research and development funds to higher education institutions, providing 40.6 percent of the total.

The other five agencies that accounted for the vast majority of federal funding for research and development funds provided to universities and colleges are: the National Science Foundation (11 percent); Department of Defense (7 percent); NASA (5 percent); Department of Energy (4 percent); and Department of Agriculture (3 percent).

The RAND analysis also found that federal funding is concentrated in a fairly small number of higher education institutions. The top 80 institutions received 71 percent of the total federal funds awarded for university and college research and development.

A dozen institutions consistently ranked in the top 20 recipients of research and development funding, whether or not awards to medical schools are included. Those schools are, in alphabetical order: Columbia University; Harvard University; Johns Hopkins University; Massachusetts Institute of Technology; Stanford University; University of California, Los Angeles; University of California, San Diego; University of Michigan, Ann Arbor; University of Minnesota, Twin Cities; University of North Carolina, Chapel Hill; University of Washington, Seattle; and University of Wisconsin, Madison.

California, New York, Pennsylvania and Texas were the only states that were successful in obtaining significant amounts of research and development funds from all of the major federal research and development agencies.

California, Illinois, Maryland, Massachusetts, Michigan, New York, North Carolina, Pennsylvania and Texas were the only states that consistently ranked among the top 10 states whose higher education institutions received the most federal research and development funds between FY 1996 and FY 2002, regardless of which agency provided the funds, according to the report.

Fossum said the study for the first time gives university and college decisionmakers the “level playing field” they need to accurately gauge their success in acquiring federal research and development funding. The study presents several breakdowns of how federal research and development funds are distributed to colleges and universities. Higher education institutions can now assess their relative competitiveness and success, compared with other institutions, in obtaining federal research and development funds.

In addition, the new study enables higher education institutions to better assess their rights to intellectual property created through federally funded research and development. The assumption has been that all federal research and development funds were awarded to higher education institutions in the form of grants, which generally assign those rights to the institutions or researchers. In contrast, RAND researchers found that a notable portion of federal research and development funding was awarded in the form of contracts. Contracts generally assign intellectual property rights to the federal agency funding the work.

The study was carried out using RAND’s RaDiUS (Research and Development in the United States) database. The database was developed to provide the White House Office of Science and Technology Policy (OSTP) with detailed information on the nature, magnitude and locations of the individual activities that comprise the federal government’s research and development portfolio. An earlier report released in 2000 was the first to ever describe the totality of these critical activities in the context of their geographic locations.

The analysis was conducted in RAND’s Science and Technology research program and was funded by NSF at the behest of OSTP. Other authors of the report are Lawrence S. Painter, Elisa Eiseman, Emile Ettedgui and David M. Adamson. The executive summary is available in print and on RAND’s Web site. The appendices containing various rankings and other tables are available only on RAND’s Web site or on CD-ROM.

The study found that:

  • The top 10 recipients of federal research and development funds in 2002, including medical school funding, were: Johns Hopkins University; University of Washington, Seattle; University of Pennsylvania; University of Michigan, Ann Arbor; University of California, Los Angeles; University of California, San Diego; Stanford University; Massachusetts Institute of Technology; University of Wisconsin, Madison; and Washington University, St. Louis.
  • The top 10 recipients of federal research and development funds in 2002, excluding medical school funding, were: Johns Hopkins University; Massachusetts Institute of Technology; University of Washington, Seattle; University of Wisconsin, Madison; University of California, Berkeley; University of California, San Diego; Pennsylvania State University, University Park; University of Michigan, Ann Arbor; University of Illinois, Urbana-Champaign; and University of Minnesota, Twin Cities
  • The top 10 states housing universities and colleges that received the most federal research and development funds in FY 2002, including medical schools, were: California, New York. Pennsylvania. Maryland, Texas, Massachusetts, North Carolina, Illinois, Michigan and Ohio
  • The top 10 states housing universities and colleges that received the most federal research and development funds in 2002, including medical schools, were: California, Maryland, Massachusetts, New York, Pennsylvania, Texas, Illinois, Michigan, North Carolina and Washington.

A printed copy of "Vital Assets: Federal Investment in Research and Development at the Nation's Universities and Colleges" (ISBN: 0-8330-3624-6) can be ordered from RAND's Distribution Services (order@rand.org or call toll-free in the United States 1-877-584-8642).

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