• INCLUDES ESTIMATED DATA FOR JUNE 1967 OUTPATIENT HOSPITAL SERVICES 3,500,000 BILLS RECEIVED ALL OUTPATIENT BILLS, WHETHER FOR DIAGNOSTIC OR THERAPEUTIC SERVICES, RESULT IN EITHER A CREDIT TOWARD THE $50 PART B DEDUCTIBLE, OR A PART B PAYMENT IF THE $50 DEDUCTIBLE IS MET INCL. EST. DATA FOR JUNE 1967. E-STATEMENT OF WILBUR J. COHEN, UNDER SECRETARY OF HEALTH, EDUCATION, AND WELFARE* Mr. Chairman and members of the committee, I am pleased to be here today with Dr. William H. Stewart, Surgeon General of the Public Health Service to give the Department's wholehearted and enthusiastic support to the Partnership for Health Amendments of 1967, H.R. 6418, introduced by the distinguished chairman of the Committee, Mr. Staggers. In 1936 Congress first provided, in the Social Security Act, a general health grant program to support any part of a State's public health program. Since that time the Federal government has continued to be one of the major financial partners in the nation's health enterprise because Congressional concern and public attention has been aroused by a variety of urgent, specific health problems. Federal support was provided in the form of earmarked grants. The result, over the past decades, has been a salutary growth in health resources and some dramatic breakthroughs in health protection. Thirty years of Federal-State cooperation in health programs has brought us to the point where the States can and should be given a larger role and a much greater measure of flexibility in planning and carrying out health programs. Two important changes in this direction were provided by the Comprehensive Health Planning and Public Health Services Amendments of 1966: first, a real opportunity and a mechanism for the States and localities to identify their own most urgent health needs and, second, a change in Federal funding to help them meet those needs. Last year we appeared before this Committee in the closing days of the 89th Congress to request that the Congress enact those amendments into law. We asked for your quick action at that time because we felt that it was of great importance that the principle embodied in the bill, which has now become P.L. 89-749, be made part of the structure of our national health effort. Your action was timely. We are grateful for it. President Johnson specifically recognized the importance of your action in his February 28 Message to the Congress on Health and Education; he said: "The Partnership for Health legislation, enacted by the 89th Congress, is designed to strengthen State and local programs to encourage broad gauge planning in health. It gives the States new flexibility to use Federal funds *See reference on p. 4. by freeing them from tightly compartmentalized grant programs. It also allows the States to attack special health problems which have regional or local impact." This is the heart of the new law: planning for the efficient use of resources, and sufficient flexibility to use resources efficiently. We have as a Nation, Mr. Chairman, committed ourselves to promoting and assuring the best level of health attainable for every person in this country. The magnitude and complexity of that commitment requires that we marshal all our available health resources, public and private, in a vital partnership to achieve this objective. The bill before the Committee would continue and expand the new partnership which was created by the Congress last year. In the intervening months, since you last considered the partnership for health, the Public Health Service and the Department have become more intimately acquainted with the possibilities and problems posed by this large effort. We have begun to lay the base which is necessary to move away from the restrictive effects of fragmented and outmoded patterns. We have begun the task of creating a new relationship which can enable every sector of the total health community to provide fuller service to our citizens. The Public Health Service has been consulting with representatives of State. county and local governments; with university officials; with representatives of professional organizations such as the American Medical Association, the American Hospital Association, the American Public Health Association, the American Institute of Planners; and with many voluntary organizations which have a long-standing interest and involvement in health affairs. Some of them, for example, are the American Heart Association, the American Cancer Society, the National Tuberculosis Association. These meetings have done much to shape our initial thinking and indicate the direction we must take in launching this nationwide program. Early in January, Secretary Gardner wrote to each of the State Governors and expressed his belief that P.L. 89-749 is one of the most significant health measures passed by the Congress. The response from the States to the Secretary's letter has been most gratifying. The Honorable William L. Guy, Governor of the State of North Dakota and Chairman of the National Governor's Conference, wrote to the Governor of each State: "This new health legislation could be a milestone in our continuing progress toward improved Federal-State relations." Governor Guy wrote this to the President: "When you signed into law Public Law 89-749, known as the 'Comprehensive Health Planning and Public Health Services Amendments for 1966.' you gave federal aid an historic turn for greater federal-State relations. The Act will now permit total comprehensive planning in the field of health." The Honorable Hulett C. Smith, Governor of the State of West Virginia, wrote to say that "West Virginia is eager to take full advantage of the Comprehensive Health Planning and Public Health Service Amendments." Governor Harold LeVander of Minnesota concluded his letter to the Secretary by saying: ". . . This program will undertake to assess the present level of health programming and health resources. This assessment, I am confident, will lead to improved and more efficient programs and to fruitful working relationships between the health consumer, the governmental, the private and the voluntary health agencies in our State." Thirty-seven States, the territories, and Puerto Rico, each have already designated a comprehensive health planning agency. We believe that the remaining States will take action to designate an agency within the very near future. We are greatly encouraged, Mr. Chairman, by the very deep interest and marked enthusiasm which the States have shown in this new program. Section 2 of the bill before you now embodies no major changes in philosophy, direction or emphasis from P.L. 89-749. It extends and expands the authorizations for grants for comprehensive health planning and services which were provided last year. The important innovations enacted last year are preserved in full: the concept of comprehensive health planning to be undertaken by the States with Federal grant support; the extension of area-wide planning of facilities to encompass all health services; the training of the personnel necessary for these planning efforts; the new program of flexible assistance through State formula grants, without categorical restriction, for the public health services the States need the most; the broad project grant authority for the stimulation of new kinds of services, and for dealing with special types of problems. The bill extends the authorizations for each of these aspects of the program through fiscal 1972. It would increase the authorizations for assistance to the States for planning activities, under section 314 (a) of the Public Health Service Act, from the present $5 million to $7 million for fiscal 1968. It would also increase the authorizations for both formula grants under section 314(d) and projects grants under section 314 (e) from the present $62.5 million to $70 million for fiscal 1968. Funds to support these increased authorizations are included in the President's 1968 budget request. Formula grants to the States in fiscal 1967, under the previous Public Health Service Act authorizations, were at a level of $55 million annually, and assistance under the project grant authorizations was at a level of $58 million annually. A large proportion of the funds authorized under the Partnership for Health Amendments for fiscal 1968 are likely to be committed by the States to programs approved and begun in earlier years. The $70 million authorization for fiscal 1968 will thus allow for only a modest expansion in these activities, and result in a roughly constant Federal share of the total cost. There is little doubt that diversity of needs and resources extends down into the localities within the States; and the Partnership for Health recognizes this, both in the planning and funding of health services. Local planning is an essential base for the State-wide planning effort. Local participation and knowledge of the area to be served can best come from the area-wide planning groups. The provision in this bill that at least 70% of the allotments for support of health services shall be available only for services in communities is further evidence of the desire to move planning and programs closer to the people who are to be served. The new project grant authority in section 314(e) is also broad and flexible. It will permit the development and initial support of health services and will make it possible to mount narrower, targeted attacks on problems of limited geographical scope or of special regional or national significance. The combination of these two approaches, a highly focused developmental effort and flexible support for continuing service offers, we believe, a framework within which the comprehensive planning carried out by States and localities can be meaningfully translated into good health care. The Congress has done much in the past several years to meet the justifiable expectations of the American people that this country can and will provide the best in health care to all its citizens. Medicare and Medicaid are major steps in removing financial barriers to health care. This Committee has recommended a series of laws which are building up the basic resources necessary to produce an adequate supply of trained manpower. Since 1946 we have been redressing imbalances and inadequacies in the supply and distribution of health facilities. And we have begun a program which will create a network of services designed to reduce the lives lost to heart, cancer, stroke and other major diseases. Each of these steps was important; each was basic. We have now reached a stage where harder tasks must be faced. We must find ways to make the total organization of our health effort as efficient as possible. The Partnership for Health is an indispensable element in reaching that goal. HEALTH SERVICES RESEARCH AND DEVELOPMENT President Johnson in his Health and Education message pointed out that despite a $43 billion annual expenditure for health and medical care our system of providing health services is not operating as efficiently and effectively as it should. We have done much to train the manpower, to build the facilities, and to pay for the services which the American people demand and require. We have not, however, done nearly enough to mobilize our universities, our industries, our private practitioners and research institutions to seek new ways of providing madical services and to hold down the cost of health care. Research and development can greatly improve the health services system. Yet today, the governmentwide total investment in health services research amounts to less than one-tenth of one percent of our total annual investment in health care. A major concern of the Department of Health, Education, and Welfare is to create a research and development program which will bring health services to a |