When I started Rock Talk, one of my goals was to lift the curtain on NIH decision-making and to demystify NIH policies and processes. One topic that I have talked endlessly about throughout my tenure is indirect costs (IDCs). Indirect costs generate almost more discussion than any other topic and there are many misunderstandings about them. Comments and questions reflect a range of perspectives, such as: “Indirect costs are rising all the time and eating up funds that could go for research.” and “Why can’t NIH reduce the rate of indirect costs?”. Others have asked us, “NIH – please get rid of the 26% cap in administrative indirect costs!” or simply want to know, “INDIRECT COSTS! Huh! What are they good for?!” (to paraphrase Edwin Starr).
At meetings, and in the blogosphere (Rock Talk comments especially!), I hear a lot of misconceptions of how IDCs are determined, how they are calculated and applied, and general debate about what role indirect costs play in supporting research. For example, in the responses to the NIH request for information asking for your comments on creating efficient and sustainable funding policies, many respondents commented on IDCs and echoed this debate. IDCs are not just fervently discussed in the extramural community outside NIH, but among NIH’s extramural staff as well.
I thought a recent presentation I gave to NIH leadership would be of benefit to the community too, so I’ve recorded this presentation to post on the blog. I hope it is helpful in understanding the background and use of indirect costs in supporting research and sheds some light on the costs of research, both direct and indirect. Enjoy.