The Institute of Medicine issued its report on the study of co-administration of services and research programs in PHS. The report indicated that the structure of the organization was less important in determining the administration of programs than the nature of the policies guiding program administration. It, therefore, recommended that agency-level organization not be used as the basis for deterring or encouraging reorganization.
In the spring of 1991, the administrator of ADAMHA sent a reorganization proposal to the assistant secretary for health to separate research and services programs into two agencies. NIH submitted a reorganization proposal to incorporate the ADAMHA research institutes into NIH as three separate institutes. In June 1991, the secretary presented his reorganization proposal which called for creating a "new ADAMHA" composed of the services programs and moving the research programs to NIH. Following the secretary's proposal, both Senate and House committees held hearings on the proposed reorganization. Although legislation authorizing the reorganization was approved by the Senate in 1991, the House could not reach agreement on all sections of the legislation and the bill had to be considered again the next year.