BETHESDA, Maryland (CNN) -- Health and Human Services Secretary Kathleen Sebelius told government leaders at a swine flu preparedness summit Thursday that a vaccine to fight the H1N1 virus should be ready for distribution in mid-October.

HHS Secretary Kathleen Sebelius tells a summit Thursday that the impact of the H1N1 virus may worsen in the fall.

But Sebelius also advised 500 government, health and education leaders to plan for the worst-case scenario of the virus reappearing with renewed strength this fall.

"What we need to assume is that it will come back in a much more severe form," she said at the conference at the National Institutes of Health in Bethesda, Maryland, outside Washington.

Commonly called swine flu, the virus is also known as influenza A(H1N1). The World Health Organization declared the virus a global pandemic last month.

Sebelius said that extensive planning to combat the spread of the virus always could be scaled back later but that officials could not delay starting work on those preparations.

"We can step back from our planning. What we can't do is wait until October," she said.

The fight against H1N1 will be federally funded, the secretary said. She said the government will announce $350 million in preparedness grants on Friday, with $260 million for state health departments and $90 million for hospitals preparing for a possible surge of patients.

President Obama requested the summit, and he spoke to the group via video link from Italy, where he is attending the Group of Eight meeting of industrialized nations.

"We want to make sure we aren't promoting panic, but we are promoting vigilance and preparation," Obama said.

Obama urged state and local officials, including school districts, to prepare for a vaccination campaign in the fall and to anticipate that the virus could significantly affect schools.

Health care workers hope to evaluate a candidate vaccine against H1N1 in August, said Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, who also spoke at the meeting.

Sebelius said medical experts are testing virus strains, preparing the production lines and beginning clinical trials.

She said the initial target group for the vaccine will be pregnant women, children ages 5 to 17, health care workers, the elderly and anyone with chronic health conditions such as asthma.

A new Web site has been set up for H1N1, http://www.flu.gov/, which has information on the virus and helpful tips.

A school nurse was one of three education workers invited to talk about their experiences in the spring during the wave of swine flu cases.

Mary Pappas of St. Francis Prep High School in Fresh Meadows, New York, said she was called on to take charge when students began showing up in her office with fevers.

Pappas said that she told the kids to pull out their cell phones and call their parents to come get them. That Thursday, she sent 102 students home; on Friday, another 80 sick students left school.

At one point, she said, there were so many sick teens that she asked a security guard to take their temperatures, write the number on a Post-it note and attach it to their chests.

The private school was closed during the following week.

According to the New York City Health Department, at least 69 cases of the H1N1 virus were confirmed at the school, and the number likely increased after the agency stopped counting.

A health department survey showed that one-third of the students, or 659 teens, reported flulike symptoms during April.

Belinda Lee Pustka, a school superintendent in Schertz, Texas, a suburb of San Antonio, said parks and churches closed when the swine flu hit.

Parents wanted to know the impact of the virus on their family and community, said Pustka, who oversees the Schertz-Cibolo-Universal City Independent School District.

Good communication was the key, she said. The district held daily news conferences and opened a Twitter account that some people used to ask questions during briefings.

"It was a very positive experience, but it was a very hard experience for the community," Pustka added.

Swine flu continues to circulate in the United States and more than 120 other countries -- especially in the Southern Hemisphere, where flu season is under way. The virus could hit the U.S. as children return to school, which is only weeks away, Sebelius told CNN earlier Thursday.

Thursday's symposium offers an opportunity to look ahead and begin to put things in place, Sebelius said on CNN's "American Morning."

There are more than 33,900 confirmed and probable cases of the H1N1 virus in the United States, with 170 deaths, according to the Centers for Disease Control and Prevention. More than 98,000 cases have been documented worldwide, with 440 deaths, according to the WHO.

The virus has bucked traditional flu outbreak patterns. Influenza is typically more active during winter and then slows when the weather turns hot.

"Now, in the UK, as in many of the North American countries -- Canada, Mexico and the United States -- there has been quite widespread activity, or a lot of activity of this pandemic influenza virus. And right now, it is at a typical point of the year where the activity should be pretty low, but the activity is quite high because it is a pandemic situation for these countries," Keiji Fukuda, WHO assistant director-general, said this week.

Regular seasonal flu kills about 36,000 Americans annually. Sebelius said the vaccine for seasonal flu is ready for use.

All About Swine Flu • Centers for Disease Control and Prevention • Kathleen Sebelius