you should have come and asked for even more as far as the chairman is concerned.

Thank you very much, gentlemen. We will meet again at 10 tomorrow.

(The committee subsequently received the following letter from Mr. Leopold :)

STATE OF VERMONT, DEPARTMENT OF HEALTH, Montpelier, September 22, 1970.

Hon. RUSSELL B. LONG,

Chairman, Committee on Finance,

Senate Office Building, Washington, D.C.

DEAR SENATOR LONG: At the close of testimony presented by Dr. Kenneth Gaver, Harry Schnibbe and myself on H.R. 17550, you asked us a number of questions regarding program proposals put forth by our Association. On behalf of the National Association of State Mental Health Program Directors, Dr. Gaver and I wish to thank you and the committee members for your time, patience and consideration. We are exteremly pleased that your interest in the mentally disabled in our society continues.

In view of your committee's interest in, and insistence upon, more effective utilization review, independent medical audit and program audit, principles which we accept and fully endorse, we therefore wish to make some changes in our proposed amendments to H.R. 17550. These amendments, if adopted, would assure the program utilization control necessary to effective operation and achievement of the mandated goals of improving the care of our mentally disabled.

Amendment # I

H.R. 17550 is amended to add on page 105, line 3, following "year" the following: "in the same skilled nursing home" and further is amended to add on page 105, line 4 following "and" the following: "if the state is presently participating or in the future elects to participate under the provisions of section 1902a (20) that state shall provide in its state plan developed and implemented methods of assuring utilization review as imposed by section 1861 (k) for purposes of Title XVIII, independent medical audit, and program audit as approved by the Secretary. Failure to provide such review and audits shall subject that state to the provisions of section (C) until compliance with the review and audit requirements are effected.

This amendment, as proposed, would penalize the states for non-compliance, but would allow the continuation of the program in those states where the mental health authority and the individual institutions have operationally provided satisfactory compliance. Measurement of satisfactory compliance would of course be dependent upon sufficient staff in the HEW Regional Offices to adequately monitor and confirm compliance.

Amendment # II

H.R. 17550 is amended to add on page 104, line 21 following "thereof" the following: "and, if a skilled nursing home does not incorporate into its operational program methods of assuring utilization review as imposed by section 1861(k) for purposes of Title XVIII, independent medical audit and program audit as approved by the Secretary, such skilled nursing home shall be subject to the provisions of section (B) until compliance with review and audit requirements are affected.

This amendment would provide for compliance of skilled nursing homes on the basis of individual facilities, thus if one facility achieved compliance it would continue to receive eligible recipient patients without penalty either to the facility or to the individual recipient. It is our feeling that this method would not only be more equitable to recipients (presently provisions of H.R. 17550 penalizes recipients who have no contro lover the care systems which they enter, nor can they control or affect the compliance) but would also allow a state to continue to utilize those facilities which have attempted to comply rather than have a wholesale program reduction and penalty.

Amendment # III

On page 107 strike lines 7 through 11.

Amendment # III is the same as that which we proposed in our testimony, i.e., it would eliminate the exclusion of public institutions from intermediate care facility operation. We have previously commented on the desirability and necessity of continuing inclusion of public facilities in the intermediate care program.

Amendment # IV

In section 238 on page 133 of the bill, add the following language on line 21 following the word "agency"-", with the consultation and agreement of the mental health and mental retardation authority, in regard to program design and program quality,”.

On page 134, line 4, after the word "health", add the following phrase “such as mental health and mental retardation,”.

On page 134, line 18, after the word "health" insert "and mental health and mental retardation".

This amendment assumes importance from the viewpoint that mental health and mental retardation program standards must be established by the mental health/mental retardation authority rather than by the (public) health authority which, in many states, does not understand mental health/mental retardation program goals and methods. Cases of such misunderstanding in our states as well as by Medicare fiscal intermediaries are well documented, and on record with the staff of your committee.

In your questioning of Dr. Gaver, Mr. Schnibbe and myself you inquired about proposals for program involvement for care of mentally disabled persons under the provisions of Title XIX. At that time we stated that our Association was previously on record supporting the elimination of discrimination against persons under 65 years of age. I have enclosed a copy of the testimony of Leonard Ganser, M.D. of Wisconsin before your committee and before the House Ways and Means Committee during 1967.* These statements fully document the reasons for which we proposed the elimination of this discrimination.

I have also enclosed a presentation of "Financing the Care of the Mentally Ill under Medicare, Medicaid" by Dorothy P. Rice, Ruth I. Knee and Margaret Conwell. These people, along with several others, were members of the ad hoc committee which studied these questions during 1968. This paper was presented at the annual meeting of the American Public Health Association in Philadelphia November 13, 1969.**

On behalf of the Association, Dr. Gaver and myself, I wish to thank you again for your interest and attention.

Sincerely,

JONATHAN P. A. LEOPOLD, M.D.

(Thereupon, at 1:15 p.m., the committee adjourned to reconvene at 10 o'clock on Wednesday, September 16, 1970.)

*See Committee on Finance hearings entitled "Social Security Amendments of 1967" pt. 3, pp. 1740 ff. **The paper was made a part of the official files of the committee.

SOCIAL SECURITY AMENDMENTS OF 1970

WEDNESDAY, SEPTEMBER 16, 1970

U.S. SENATE,

COMMITTEE ON FINANCE,
Washington, D.C.

The committee met, pursuant to recess, at 10:05 a.m., in Room 1221, New Senate Office Building, Senator Russell B. Long (chairman) presiding.

Present: Senators Long, Anderson, Talmadge, Byrd Jr., of Virginia, Williams of Delware, Miller, and Jordan.

The CHAIRMAN. In view of the fact that the Senate is in session and Senator Percy will have to participate in the debate immediately, Senator Harrison Williams of New Jersey has generously consented to permit Senator Percy to open with his statement and then we will take Senator Williams.

Senator Percy.

STATEMENT OF HON. CHARLES H. PERCY, A U.S. SENATOR FROM THE STATE OF ILLINOIS

Senator PERCY. I wish to extend my deep appreciation to my colleague, Senator Williams, and his guests.

Mr. Chairman and members of the committee, I welcome this opportunity to set forth my views on the social security program. Our social security system is one of the most successful, effective programs ever devised by Congress. To assure its continued success, we need to reevaluate it periodically-as this committee is doing and ask ourselves whether the program, in its growing complexity, has overlooked or failed to help certain individuals. Do our methods of fulfilling the original purposes of social security need to be modified in any way? Should these purposes themselves be changed?

I would like to talk on five particular areas where I feel we can improve and strengthen the social security system.

The first deals with benefits for unadopted grandchildren dependent upon their grandparents.

In raising the questions as to whether the program has failed to reach certain individuals it should help, I concluded that it has overlooked some individuals. Under the present social security law, some children who are dependent on their grandparents cannot obtain benefits based on their grandparents' earnings. A grandchild must be adopted by his grandparents before he qualifies for a child's social security benefits. This is most unfortunate, as there are cases in which the grandparents, for valid reasons, are either unable to do or do (551)

not wish to adopt the child, yet still maintain a quasi-parental relationship.

The purpose of social security is to provide the family with a continuing source of income when the family income stops because of the death, retirement, or disability of a worker. Following this, social security benefits are paid to children whose parents have died, retired, or become disabled on the theory that children are generally dependent on their parents and suffer a loss of support when the parents' income stops. However, if that "parent" is a grandparent the child suffers in being denied a social security benefit. Benefits are extended to grandchildren only when they are legally adopted.

This distinction which prohibits the unadopted child living with and supported by his grandparents from receiving the same benefits he would receive if he were adopted is grossly unfair. A child dependent on his grandparents is as deserving of social security benefits as a child who is dependent on his parents—perhaps even more deserving as grandparents very possibly would have less income. The payment of these benefits should be based on the realities of the situation.

I therefore urge favorable action on my amendment to permit the payment of social security benefits to the dependent grandchildren of disabled, retired, or deceased workers when it can be shown that the child is actually dependent for support upon the grandparents. My amendment re-defines the term "child" so that benefits would be provided for a grandchild if, at the time the grandparents died or became entitled to benefits, he had been living with the grandparents at least 1 full year-except in the case of death or disability of the grandparents within the same year as the loss of support from the parents. In addition, it would have to be shown that the grandparents actually furnished at least one-half of the child's support during this time.

Adoption of the measure would correct an anomaly in the social security program. It would make actual dependency the criterion for payments to a grandchild.

Although this is not a major change when measured in terms of the number of people affected, it is nonetheless a major change when measured by the effect it will have on the incomes of those individuals who will qualify for benefits. Moreover, the social security actuaries inform me that because only a relatively few people (about 200) could be expected to qualify for benefits, adoption of the proposal would have no significant effect on the total cost of the social security program. (The level-cost would be 0.01 percent of the taxable payroll.) While my amendment applies only to grandchildren, the Committee may very well wish to expand this legislation to cover other related children who find themselves in similar circumstances.

My second suggestion is in connection with the removal of "relative responsibility" clauses in titles X, XVI, and XIX of the Social Security Act.

At present, title XIX of the Social Security Act (Medicaid), in determining eligibility for the extent of medical assistance to be available to individuals, states that "the financial responsibility of any individual for any applicant or recipient of assistance under the act should not be considered unless such applicant or recipient is such

individual's spouse or such individual's child who is under age 21; or is blind or permanently disabled.

Titles X and XVI (Grants to States for Aid to the Blind; and Grants to States for Aid to the Aged, Blind, or Disabled) also have the effect of allowing States the latitude to set up "relative responsibility" regulations. In other words, blind or permanently and totally disabled persons over 21 must, in many cases, prove that their parents do not have the financial ability to meet their medical-or otherneeds. The law subjects blind persons to a humiliating and unfair discriminatory practice, in that they are essentially expected to bankrupt their parents before receiving Federal assistance, while nondisabled, but needy persons are not expected to prove their parents are unwilling or unable to help them.

When one considers the hardships caused by blindness, and the courage and self-confidence necessary to overcome this handicap so as to function in a dynamic society, it seems even more unfortunate that blind persons must face a humiliating, painful, and unnecessary experience before qualifying for assistance they might need. The sense of independence and self-respect that a blind adult can acquire by knowing he is no longer a burden to him family may make a significant impact on his level of aspiration and ability to move forward into real independence.

Again, I am urging the passage of legislation which would not affect a large number of people. It is estimated that only about 1,000 people would be affected by this proposal, but its passage would end a discriminatory, highly offensive practice for those who are affected. My personal interest in this is in having had in childhood a blind piano teacher; in having lived near and worked with the Lighthouse for the Blind a beacon of hope to thousands of blind people throughout the world in Winnetka, Ill., for 20 years; and in having been an employer for 25 years when I found that blind people can be employed in many ways and in very useful occupations. I think our company had a very high ratio of blind persons who were given hope through this employment, and that is why I have continued my interest in trying to find ways in which we can remove discrimination against them.

The CHAIRMAN. May I say that this "relative responsibility" has never had any great appeal to me, because I recall very much how we found in many States they were using "relative responsibility" as an excuse to keep those people off the rolls and according assistance to them.

What good does it do some poor devil if he has a relative who can help him if the relative won't help him. So to say "in view of the fact that a person has a relative who is unwilling to help, we won't help," is really a pretty sad situation.

If he has a legal right to make that relative contribute and has not exercised that legal right, then I think we have a right to say, "Well, now, if you have a legal right to sue, let's say, your father or your son, as the case may be, to help you, and you haven't availed yourself of your rights, we are not going to pay our money because legally they ought to pay," but where you have no right to make the relative put the money up you are just saying you are not going to contribute because there is a relative who could help but won't. That puts us in