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on a variety of health, sanitation, and nutrition programs, ranging from a limited medical research activity carried on by the WHO to a large malaria eradication program conducted under the auspices of WHO, PAHO, and UNICEF.

Department of State assistance to escapees from Communist countries includes the provision of necessary medical care. These programs are carried out through contracts with voluntary agencies. In certain instances, such as the flow of refugees to Hong Kong, it has been necessary to construct clinics and other health facilities to provide the essential medical care.

The expanding educational and cultural exchange program of the Department of State provides some funds for training in medical and health activities. Involved in the program are Americans who study or teach abroad as well as nationals of other countries who come to the United States for health-related teaching or studies. This activity is small but important, accounting for about 3 percent of annual outlays of the educational exchange programs.

AID, in its principal mission of assisting economic and social progress of underdeveloped countries, has a number of programs designed to improve the health-related resources of these countries. These activities range from assistance in the development and construction of medical schools and the training of health workers to the establishment of potable water supplies. Among the health programs of AID, strong emphasis also has been placed on the control of communicable diseases.

The Peace Corps now has 5,000 corpsmen assigned to 45 countries. Some of them are providing direct medical and paramedical care in the countries to which they are assigned while others are providing technical assistance concerning advanced methods of preventive medicine, sanitation, and nutrition. In addition, funds are provided for medical treatment of corpsmen.

State, AID, and the Peace Corps have established an extensive number of working relationships with HEW to coordinate activities of mutual interest. There are at least eight interagency committees on which one of these agencies has membership together with HEW. There are in existence a number of agreements for the utilization, usually on a reimbursable basis, of HEW scientific and technical personnel by State, AID, and the Peace Corps. An example of recent activity exists in the upper Volta measles study conducted in Africa. On this successful project, although there was no formal agreement between the agencies, NIH furnished the technical personnel and the vaccine and AID furnished the necessary vehicles, jet injectors, and additional supplies required. Furthermore, it has been agreed that State will provide foreign policy guidance, advice, and clearance on all foreign research grants and activities.

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VETERANS' ADMINISTRATION The Veterans' Administration is charged with the responsibility of providing hospital, domiciliary, and medical services to all eligible veterans of the U.S. Armed Forces. This responsibility is administered by the Department of Medicine and Surgery, one of the three principal operating units of the VA.

All the 22 million living war veterans are potentially eligible for hospital or medical services under VA auspices. The primary Federal responsibility under the veterans' hospital and medical care program is to service disabled numbering an estimated 3.5 million veterans. Wartime veterans may receive inpatient care and treatment in VA facilities for non-service-connected ailments only if beds are available and if the veteran is unable to defray the expenses of necessary hospital or domiciliary care. Medical services may be furnished on an outpatient basis for service-connected disabilities and for non-service-connected disabilities only to veterans who have been determined to need hospital care and whose admission to a hospital has been scheduled, or who require posthospital treatment to complete hospital care.

In 1964 the VA will render treatment to eligible beneficiaries at 169 hospitals, 20 domiciliary homes, 93 outpatient clinics, 16 subclinic offices. In those cases where VA facilities are not available, services will be provided through contractual arrangements with other hospitals. This complex of facilities repre sents the largest hospital system in terms of number of beds in the country. It is estimated that in 1964 this system will operate directly an average of 121,486 beds in hospitals and 15,496 beds in domiciliary homes. Thus inpatient care will be provided for an average of 111,640 patients per day directly in VA. operated hospitals and 2,819 patients per day in contract hospitals. About two thirds of the beds in VA hospitals are occupied by non-service-connected cases. Domiciliary care will be provided for an average of 15,496 patients per day in VA homes and 9,100 patients per day in State homes. Outpatient visits for 1964 will be an estimated 3,728,000 for both VA clinics and private doctors. In addition, it is estimated that 36,000 dental examinations and 28,000 treatment cases will be completed.

Under current eligibility classifications, the VA will continue to provide services for an estimated daily average of 139,000 beneficiaries. Three factors have a bearing on the demand for hospital and domiciliary care, assuming no change in present eligibility requirements: the veteran population which is declining, the age of the veteran which is increasing, and improvements in medical practice which are taking place. For the foreseeable future, no marked change in the total number of beneficiaries cared for is anticipated because the decrease in the number of veterans and improvements in the practice of medicine are ex. pected to offset the increasing incidence of hospitalization due to age.

The VA also conducts a research program in support of its patient service function.

In carrying out these activities, the VA and HEW cooperate through (1) membership on the President's Council on Aging and three other interagency committees; (2) joint contract hospitalization; (3) VA supply services on certain items for PHS hospitals; (4) reimbursement arrangements on NIH chemotherapy program and PHS medical stockpile programs; (5) VA membership on certain NIH study sections and NIH participation on VA research review committees; and (6) VA membership on a special task force on mental health.

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Selected health functions are also carried out through a number of other agencies. These include the Department of the Treasury, the Department of Commerce, Federal Aviation Agency, the Office of Emergency Planning, Tennessee Valley Authority, Federal Trade Commission, and the Canal Zone Government.

In general the health-related activities of these agencies come as a byproduct of their other responsibilities. Nevertheless, their contributions are important to our overall effort to insure the well-being of our citizens.

Activities carried out by the agencies range in scope and size depending on their primary missions. Important in an overall appraisal is the Science Information Exchange operated by the Smithsonian Institution on behalf of several agencies of the Federal Government. This exchange serves as a clearinghouse of current information about grant and contract recipients for research in medicine, biology, psychology, and other disciplines, the objectives of this research, and the location of the research project. This exchange helps Government agencies and individual researchers to avoid unintentional duplications of effort and to coordinate their research.

The Office of Emergency Planning has broad responsibility for coordinating plans and programs for health activities of various Federal agencies for civil defense and defense mobilization.

The remainder of the agencies focus on health activities only as they are incidental to their other responsibilities.

Mr. STAATS. I hope, Mr. Chairman, in this approach that we have been able to emphasize that the problems of program and organization in the health field extends beyond HEW. The large amount of money that is being spent requires study by both the President and the Congress. It must be examined in its totality rather than in terms of the program and the budget of the Department of Health, Education, and Welfare alone.

Mr. ROBERTS. The Chair would like to state that this has been one of the best presentations we have had. I think you have done a wonderful service to our committee and to the country in this presentation.

It gives us for the first time a very fine instrument with which to locate these funds and what they are being used for, and I certainly think that the gentleman from Minnesota would agree with me.

Mr. NELSEN. Mr. Chairman, I would like to interrupt. The chairman and I just commented here in conversation that this was the most conclusive study that we have ever had presented to our committee and it gives us information that we have really been searching for and would require a great deal of time for us to dig up, and I want to congratulate you on the fine job that has been done in this respect.

Mr. Staats. I appreciate your statement, Mr. Chairman, and we are happy that we have been able to supply this information.

Mr. NELSEN. Mr. Chairman, may I interrupt? I have to go back to my office. Yesterday, I asked the question of Mr. Jones relative to the number of employees under civil service and those that were in appointive positions, and I would like to have the comparison made from 1960 to date.

My purpose, I think, is obvious. That is that this Department is a very technical one and I just want to be sure that we are not making too many political appointees in a Department so important to the health and welfare of the people.

I would like to have that comparison that goes from 1960 to date, the number under the classified service and the number that are politically appointed.

We understand that the top-level people must have some freedom and I agree to that, but I would like to see

a comparison, Mr. Chairman. Mr. STAATS. If I may ask, for purposes of clarification would you include in the classified service those in the Commissioned Public Health Corps ?

Mr. NELSEN. Yes, and also the class C. When I was down in REA and we had others under the classified service and, I, as I recall, had one appointment and that was my deputy.

We took all the rest from the ranks and I wasn't disappointed in them. They were very, very good.

Mr. ROBERTS. Thank you, Mr. Nelsen.

Mr. Staats, for the record, it is a rare privilege for a congressional committee to have a representative of the Bureau of the Budget testify. We are gratified that the Bureau felt that our study of the growth of the U.S. Government in the field of health was important enough to warrant an appearance by representatives of your Bureau to help us with our study.

The statement which you have made, as I said before, underlines the important role from an economic point of view alone of the health programs carried on by our Federal Government.

Since most of us are not too familiar with the operations of your agency, I wonder whether you would mind explaining in some detail the various functions which the Bureau exercises with regard to the programs carried on by the Public Health Service and the Food and Drug Administration.

I have in mind particularly the functions with respect to appropriations requests and with regard to legislation, but perhaps there are other functions which you might care to elaborate on.

Mr. STAATS. Yes, Mr. Chairman. The Bureau of the Budget as presently organized dates really to 1939. At that time it was moved from the Treasury Department to the President's Executive Office.

The four functions which have been defined by statute and by Presidential directive are these:

The review of budget estimates-to advise the President with respect to the amounts to be included in his annual budget which is submitted to Congress in January; and related to that, after the appropriations are made, to apportion the funds in accordance with the laws of Congress, and to review quarterly the requirements of the agencies to be sure that the funds are well spent and do not exceed the amounts appropriated by Congress.

Included here also is the Bureau's responsibility for improvement of Federal budgeting, accounting, and other phases of financial management.

The second function which has become increasingly important over the years is the review of legislative proposals originating in the executive branch.

This has a historical basis, in part going back to the time when the Presidents felt a need for advice in coordinating the views of agencies on matters which involved fiscal legislation.

That function subsequently was enlarged to include the gathering of comments from the agencies on enrolled bills coming before the President for action. In more recent years, beginning with President Roosevelt, and extending through the administrations of President Truman, President Eisenhower, and now President Kennedythe Bureau of the Budget has played an important role in the technical review and analysis of legislative proposals either when they originate in the executive branch or when they are referred by committees of the Congress to the Bureau for comment.

I should say at this point that the staff concerned with the annual budget review and the apportionment of funds is basically the same staff that is utilized to review legislative proposals and to prepare comment for the use of the committees.

These two activities are particularly relevant to the discussion here today. There are two others, however, which I think should be mentioned because they do from time to time have a direct bearing.

One of these functions is the improvement of organization and management of the executive branch. This includes the preparation of reorganization proposals.

It includes also the study of opportunities for improved manpower utilization and increased productivity, the introduction of new, modern techniques of management-such as electronic data processing and operations research-and the improvement of pay and compensation systems.

These activities of the Bureau of the Budget are Government-wide in character, but from time to time do bear directly on the health field.

Then, finally, and fourthly, the Bureau has the responsibility by statute of reviewing all of the statistical and data collection programs of the Federal Government.

This particular function was assigned to avoid duplication in the questionnaires which Federal agencies ask private individuals to answer.

It subsequently developed to include a Government-wide statistical review; that is, the preparation of a program for improvement of statistics, and the collection, analysis, and processing of data. This activity also from time to time touches upon the public health field.

Mr. ROBERTS. I believe you say that the same experts who work on the appropriations requests also work on requests for legislation, so that has been answered. Now, as to the appropriation requests that come to you from NIH. Are they reviewed on an institute-by-institute basis, or some other manner!

Mr. Staats. I would like to comment briefly on that, Mr. Chairman, and then turn to my colleagues here because it seems to me this is a very key question in terms of the discharge of our responsibilities.

The Bureau of the Budget has a somewhat limited staff. I think these gentlemen here today would say that is an understatement.

We do not have a large staff. We have to rely to a very great degree upon the competence of the staff of the agency, in this case particularly the program staff and the budget staff of the Department of Health, Education, and Welfare.

This is no more true here than it is in any other agency. This is the way it has to work. It is the way it should work, so that we do not attempt to substitute our, you might say, technical judgment for the judgment of the agency as to the value of a particular proposal. We would not do this even if we felt we had the competence to do so.

What we do do, however, is try to be sure that there is an adequate basis for the agency's justification, that it is well founded, that is well thought through, and it has been examined carefully by the agency head.

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