from groups traditionally difficult to reach or excluded, such as minorities and rural residents. Therefore, we have included a series of amendments which provide for greater consumer and rural representation on all levels.

I would like to concentrate on one of these provisions-the encouragement of sub-area councils in HSAs covering large land areas. At present, the act authorizes but provides no funds for sub-area councils. These sub-area councils expand participation through location in different places in the HSA. A sub-area council is especially important because it allows for input by various residents who previously may have found the location of the Agency inaccessible. This is definitely true for rural residents.

I would like to discuss some examples of the present problems. Montana has a single HSA for the whole state, 145,000 square miles, yet is receives approximately the same funding as nearby Montgomery County which encompasses only 495 square miles. Similarly, Mississippi with only one HSA is 50 times larger than the HSA in Oakland, California, but both have the same size budget. Another example is that the State of Vermont, covering almost ten thousand square miles is 200 times the size of Hudson County, New Jersey. Yet both have one HSA and Hudson County has a budget. six times the size of Vermont's Health Planning budget. I think it would be fair to say that

In

it costs more to establish and effectively run a HSA with large geographic size than with a single county or city. fact, transportation costs alone make a significant difference. For example, in Wyoming, a whole state HSA, staff and board members of the HSA must use air travel as a primary means to conduct business and consequently uses a large portion of their budget merely for these transportation costs.

Therefore, not only does a large geographic size mean

less accessibility for the people who might want to participate in the planning process, but it also means higher costs for the HSA to provide sub-area councils because they do not have adequate funds. Because of this situation, those in geographically isolated areas--mostly the rural residents--are totally left

out of the decision making process.

Therefore, we suggest a grant program for assisting in the establishment, development and support of the sub-area councils. The funds appropriated would be divided on the basis of HSA geographic size with flexibility to take into account other geographical barriers, such as mountain ranges. We think that such a program would allow for much greater participation in the planning process and consequently better health planning.

Finally, we believe that the administration of the program through guidelines and plans must allow for the unique

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characteristics in certain areas of the country, such as

rural America.

It was only

Unfortunately we saw in this past year a total disregard for the special needs of rural areas when HEW publised their first set of guidelines on hospitals. after 55,000 letters from all across the country, and cajoling from Members of Congress that HEW became sensitive to the problem. Therefore, to ensure that such a situation will not be repeated and to sensitize HEW to rural America, we propose an amendment which would require the Secretary of HEW to include separate quidelines for rural areas when it was determined that the needs of the rural areas are not adequately addressed by national guidelines.

These amendments have been developed in response to the concern of many involved in rural health care. We believe that the passage of these will better orient health planning to the needs of rural America. I thank you very much for giving me this opportunity to testify. I am sure that you will give these amendments your full consideration.

Senator JAVITS. Our next witness is Robert McGarrah, of the American Federation of State, County, and Municipal Employees.

We will put your entire statement in the record, and would you just brief it for us, please?

STATEMENT OF ROBERT E. McGARRAH, JR., PUBLIC POLICY COUNSEL, PUBLIC POLICY ANALYSIS DEPARTMENT, AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES, AFL-CIO, WASHINGTON, D.C.

Mr. McGARRAH. Thank you, Senator Javits.

We appreciate the opportunity to appear here today. Our union represents 750,000 members, and over 150,000 of them work in public general hospitals throughout the country.

I would like to address three major concerns that we have with the health planning amendments.

The first is the issue of excess hospital beds. Our union is well aware of the fact that nationally, we suffer from an excess of at least 100,000 beds, which costs us around $2 billion a year, according to HEW figures.

We have long attempted to encourage HEW action to curtail and close down excess beds. The approach in these particular amendments we think is one that may have some good potentials, but we believe that it has some specific problems for employees.

Specifically what this would do would be to provide a sum of money directly to hospital administrators to pay off first of all designated groups in other words, the mortgage holders and bondholders-and then to take all the rest of the problems of conversion payment for machinery, payment for salaries and so forth, and out of that pool of money, the hospital is supposed to attempt to provide some kind of retraining and severance pay. And all of this is supposed to be overseen by HEW.

Now, we have some very serious concerns, because the Department of Health, Education, and Welfare, in its attempt to administer the employee protection provisions of the health revenue sharing, which deals with deinstitutionalization in the mental health field, and also with developmental disabilities, which deals with mental retardation deinstitutionalization, the Department has never even issued regulations, after 3 years, when Congress specifically enacted employee protection provisions.

HEW has never even issued any regulations to do this. We believe that the Secretary of Labor, who has been specifically charged by Congress under the Urban Mass Transportation Act of 1964, and also has a specific division in the Labor Department to deal just with employee protection-we believe the Secretary of Labor should have the authority to review and approve and essentially sign off on any employee protection provisions, and those provisions should be mandated in each hospital closure or termination of services.

We think that is critical to this bill, and we believe that the Secretary of Labor is best capable and best suited to performing this function. The second thing I would like to discuss is the very excellent amendments that you have added into the bill, dealing with public general hospitals.

As you know, our Union represents employees of public general hospitals, and we are very, very aware of the fact that these financially strapped institutions are the last resort for poor people's health care.

As you have mentioned, the emergency rooms of public general hospitals serve as neighborhood doctors in the cities of this country, and they also do in rural areas. And these hospitals are legally required to treat anyone who comes to their doors. They cannot simply stabilize the condition and then throw the person out to another hospital, as is the case with private hospitals.

We think that the attempt in this legislation to provide funds for life safety and licensure provisions, to encourage these hospitals to get up to standards, are absolutely critical.

In fact, we would like to see the authorizations raised to an even higher level. As you probably know, in the last few years, the number of public general hosiptals that have actually closed their doors, curtailed services, or been forced to transfer over to privately operated cooperations has rise ndramatically because of the financial difficulties that cities and counties are having in running those facilities.

Philadelphia General Hospital, the only public hospital in the city of Philadelphia, has recently closed, because the city just did not have the funds to keep that hospital's facilities up to par.

And in fact, the estimates we had from Philadelphia General were that it would cost around $75 million just to rehabilitate that facility. They were talking obviously about some new construction, as well.

So that we would like to see even a higher level-perhaps $200 million for fiscal 1979 and increasing to $250 and $300 million by 1981. We think these are very important amendments.

And lastly, as far as consumer participation goes, we support the efforts of the Consumer Coalition for Health, to get better consumer involvement in HSA's.

We think the amendments that have been proposed are excellent. We would add to it that we think that consumers need to have their own staff, accountable to them, and we would like to see some funds set aside for the consumers to hire their own consultants-just as providers do-to assist them within their deliberations on HSA's. Thank you.

Senator JAVITS. Thank you, Mr. McGarrah.

I would like to ask you one question about this increase that you recommend in the authorization for public hospitals. I would like to get some factual backup on that.

Do you have it, or how do you suggest we get it?

Mr. McGARRAH. Well, I suggest first of all that I can provide you with the figures that Philadelphia General Hospital would have needed to have rehabilitated their physical plant, and I can also, from our union in New York City, get you the figures for the estimates that they would approximate for improving hospital facilities thereand you are well aware, of course, of the situation in New York.

In addition, I think that the proposal that was included within the urban initiative that, unfortunately, the President rejected-had a section in it on public general hospitals. I do not know whether you have seen it or not, but I would be glad to supply that for the record, and the figures there are totaling approximately $500 million to do everything, ranging from improvement of outpatient departments to