Slide 1
Vaccine Management Business Improvement Project 
(VMBIP) 
Funds Management Update
National Immunization Conference
Atlanta, GA 
March 8, 2006

Slide2
Today we would like to discuss the impact of recent funds management changes on how you purchase vaccine
•What is the implementation status of the new funds management model?
•How is the Spend Plan created?
•How will NIP use Spend Plans to monitor your vaccine purchases?
•How is the Spend Plan revised?

Slide 3
Contents
•Overview of Funds Management 
•Spend Plan Creation
•Spend Plan Monitoring
•Spend Plan Revisions

Slide 4
In October 2005, we implemented a new funds management model
New Funds Management Model:  Summary

New Model
•Two accounts (VFC and 317) rather than 64 grantee accounts 
•Funds obligated against manufacturer contracts 
•Grantee spending managed through spend plans and monitoring rather than through grants

Benefits
•Greater flexibility in allocating funds where vaccine is needed
•Greater transparency into vaccine need
•Fewer funding “emergencies” due to project needs for vaccine funds

Slide 5
We have cleared the first hurdles in transitioning to “single accounts,” but there is still significant work to be done

Completed
•Transition to single accounts
•Quarterly grantee allocations for the first and second quarters of the fiscal year
•Quarterly manufacturer obligations for the first and second quarters of the fiscal year
•Manufacturing contract draw down monitoring
•Detailed Spend Plan Standard Operating Procedures (SOPs)
Underway
•Finalization of ‘06 grantee spend plans
•Spend plan monitoring reports
•Detailed systems requirements
•On-going operations support and trouble-shooting

Slide 6
Contents
•Overview of Funds Management 
•Spend Plan Creation
•Spend Plan Monitoring
•Spend Plan Revisions

Slide 7
The Needs Assessments and Spend Plans are linked and are key elements of the new funds process

Key Elements of the Funds Management Process
Data Element:	Needs Assessment
Purpose: Baseline of grantee need 
•Population estimates
•Insurance and coverage data
Details: Doses by antigen, brand and funding source 
Annual need + monthly percentages

Data Element:	Spend Plan
Purpose: Monitoring and control mechanism 
•Tracks each grantee’s vaccine consumption 
•Helps balance doses/needs to available funds
Details: Monitored weekly and monthly
Revised quarterly
Needs Assessment adjusted to meet the funding levels (317)

Slide 8
Moving forward, NIP anticipates changing the Spend Plan from a calendar year to a fiscal year for FY’07

Deadlines for 2007 Spend Plans - Year 2006
Feb 15 – Mar 15
NIP sets grantee 317 target budgets and prepares NIS and coverage data 

Mar 15
Grantee completes and returns PES to NIP 

Mar 15-Apr 15
Grantee and Project Officer review PES

May – Jun 15
Grantee completes VOFA, independent of the grant process

June 15 – July 15
Grantee and Project Officer review submission and adjust as needed 

Aug 15 – Sep 1
NIP finalizes grantee Spend Plans

Oct 1
Grantee receives 1st Q Quarterly Estimated Target Budget

Slide 9
We still have some work to do on the current Spend Plans (CY’06)
• Spend Plans are being sent back to grantees to update with the final 317 budget and to provide the opportunity for you to reflect your anticipated purchase timing as accurately as possible

• Spend Plans will be due back to us by the last week of March
•Please work with your Project Officer for help, questions or concerns

Slide 10
Contents
• Overview of Funds Management 
• Spend Plan Creation
•Spend Plan Monitoring
•Spend Plan Revisions

Slide 11
Spend plan monitoring will help manage VFC and 317 funds with minimal interruption of vaccine orders

Monitoring Process Details
Frequency:  Weekly
Threshold:  If a grantee reaches or exceed 100% of any antigen within the first 20 days of the month or if a grantee 120% of any antigen any time of the month
Action Taken:  First time – a “fact-finding” call from your Project Officer.  Second time – a “fact-finding” call from your Project Officer and the Resource Allocations and Monitoring Team Lead

Frequency:  Monthly
Threshold: If a grantee exceeds or is below 10% year-to-date of the total Spend Plan
Action Taken:  First time – a “fact-finding” call from your Project Officer.  Second time – a “fact-finding” call from your Project Officer and the Resource Allocations and Monitoring Team Lead.  Conversations about updating your Spend Plan may take place at this point.

Slide 12
During transition, the monthly allocation will limit ordering as it has in the past
Maximum Total Order equals current month Spend Plan plus the next two consecutive months on the Spend Plan minus Final Inventory of the previous month and current orders.

Slide 13
Below is an example of how the monthly allocation will work

2006 Vaccine Allocations Summary For:  Grantee X
Wednesday March 01, 2006
February	

Vaccine Type:  DTaP
VFC Doses to Purchase/Current Purchase: 30,000/22,000
317 Doses to Purchase/Current Purchase: 7,000/9,000
State Doses to Purchase/Current Purchase: 5,000/4,550
Reported Inventory: 48,290
VOFA 3 Month Need (Feb+Mar+Apr): 130,000
Order Status: VFC Max - Hold Order if >: 80% 36,928
Order Status: 317 Max - Hold Order If >: 10% 4,616
Order Status; State Max - Hold Order If >: 10% 4,616

Vaccine Type:  Hep A
VFC Doses to Purchase/Current Purchase: 45,111/30,000
317 Doses to Purchase/Current Purchase: 15,000/10,180
State Doses to Purchase/Current Purchase: 10,000/5,000
Reported Inventory: 24,590
VOFA 3 Month Need (Feb+Mar+Apr): 104,310
Order Status: VFC Max - Hold Order if >: 70% 24,178
Order Status: 317 Max - Hold Order If >: 20% 6,908
Order Status; State Max - Hold Order If >: 10% 3,454

Vaccine Type: MMR	
VFC Doses to Purchase/Current Purchase: 25,080/15,000
317 Doses to Purchase/Current Purchase: 16,750/10,000
State Doses to Purchase/Current Purchase: 30,000/12,100
Reported Inventory: 45,290
VOFA 3 Month Need (Feb+Mar+Apr): 144,000
Order Status: VFC Max - Hold Order if >: 50% 30,805
Order Status: 317 Max - Hold Order If >: 20% 12,322
Order Status; State Max - Hold Order If >: 30% 18,483

Slide 14
Contents
•Overview of Funds Management 
•Spend Plan Creation
•Spend Plan Monitoring
•Spend Plan Revisions

Slide 15
Each quarter, specific situations may trigger Spend Plan updates, but should be made no more than once a quarter

Overview of Spend Plan Updates and Timing
Trigger: NIP initiated changes due to expected 317 funding levels
Q2: yes
Q3: yes
Thresholds for Revisions: Balance check at an aggregate level to determine if sufficient funding exists.  Excise tax credits will take place in Q3 – if applicable

Trigger:  Grantee initiated changes
–	Changes to state funding levels
–	Changes in underlying need
–	Revisions to monthly percentages
–	Q1: yes
Q2: yes
Q3: yes
Thresholds for Revisions: 10% variance from Year To Date plan

Trigger:  Vaccine-related changes
–	Pricing changes
Q 2: yes
Q3: yes
–	Removal from/addition to       formularies
Q1: yes
Q2: yes
Q3: yes
Thresholds for Revisions:  Increases only – Balance check at an aggregate level to determine if sufficient funding exists. Usually coincides with contract price adjustments

Slide 16
The Funds Management Team continues to move forward in finalizing the processes and communicating these changes
•Work with grantees to finalize FY’06 Spend Plans and begin preparation for FY’07 Spend Plans

•Finalize monitoring reports and begin monitoring Spend Plans

•Finalize all other Funds Management processes
•Continue to communicate changes via documents and posting on the VMBIP website

Slide 17
Questions?

Slide 18
Vaccine Management Business Improvement Project 
(VMBIP) 
Implementation Update
National Immunization Conference
Atlanta, GA 
March 8, 2006

Slide 19
Today, we would like give you a brief update on recent VMBIP developments
•Update on implementation of centralized distribution
•Overview of the VMBIP Evaluation Plan
•Information about the VMBIP website

Slide 20
Distribution RFP responses were due Feb. 21 – they will be evaluated by a panel of CDC and grantee representatives over the coming months

Acquisition Timeline Milestones
•	Feb 21: Due date for proposals
•	Feb 22: Removal of small business set-aside requirement
•	Mar 16: Receipt of revised proposals with Texas included in West region bid
•	Jul 27: Contract award date
•	Oct 2: Contract start date with 1st pilot go-live

Members of the Acquisition Review Panel
•	Kim Lane, CCID
•	Sandi Gambescia, NIP/ISD
•	Joe Nay, NIP/OD
•	Mary Mulholland, NIP/ISD
•	Tony Richardson, NIP/ISD
•	Karen Hess, Texas Immunization Program
•	Paul Garrison, Oklahoma Immunization Program

Slide 21
Based on this schedule, the implementation period is anticipated to run from October 2006-December 2007

VMBIP Centralized Distribution Implementation Timeline – Proposed
Centralized Distribution: Pilot Grantees
Description: Pilots
Timelines:
Preparation: June through September
Implementation: October
Award Contract: Jul 27
Pilot Launch: Oct 2-16
End of Third Party 60% of Vaccine Transitioned:  March 31
End of FY’07: September 31

Centralized Distribution: Remaining Grantees
Description: Third Party
Timelines:  
Grantee 1:  Preparation September and October.  Implementation November.
Grantee 2:  Preparation November and December.  Implementation January
Grantee 3; Preparation February.  Implementation March
Third Party Launch: Oct 23-Mar 26

Centralized Distribution: Remaining Grantees
Description: In house
Timelines:  
Some grantees: Preparation April through June.  Implementation July
Some grantees: Preparation August through November.  Implementation December.
In-house Launch: Jul 16-Dec 24

Slide 22
Specific transition dates will be communicated to grantees via the Project Officers and ISD Leadership

Implementation Communications To Grantees
Milestone: Conference call from the Project Officers. Specific transition dates with be shared with each grantee
Participants: Project Officers and Grantees

Milestone:  Letter sent from ISD Leadership stating official date for conversion to centralized distribution
Participants:   ISD Leadership and Grantees

Slide 23
As you begin to think about implementation, valuable information from the pilots can be found on the VMBIP website
•	The VMBIP website is up and running
•	Directions to obtain an SDN certificate have been sent out to all grantees
-	Please let us know if you have not received these directions
•	Past and future documents will be found on this website and are downloadable
•	Documents from the Pilot projects such as VMPIP newsletters, presentations, draft communications plans, have all been uploaded onto the site and will continue to be uploaded 

Slide 24
As we implement the many changes associated with VMBIP at NIP, we have developed metrics to measure the project’s success

What are we measuring?
VMBIP’s ability to improve…
-	Effectiveness – Improved ability to meet public vaccine needs

	% of providers submitting inventory data
–	Order error rate
–	Provider satisfaction based on semi-annual or annual survey score
Efficiency – Reduced vaccine ordering and distribution costs throughout the system
–	Change in distribution cost per dose
–	Changes in inventory levels nationally

How are we going to use these metrics?
Metrics will be used to:

-	Serve as an early warning system to identify and help resolve any performance issues

-	Document VMBIP impact on the National Immunization Program, Grantees and Providers

Slide 25
Questions?

This document can be found on the CDC website: http://www.cdc.gov/vaccines/programs/vmbip/downloads/nic/06-combo-vf.rtf