investigation, demonstration, and consultative services to Guam, American Samoa, and the Trust Territory of the Pacific Islands." SEC. 3. In order to afford the States which, immediately prior to July 1, 1955, were carrying on public health programs under State plans approved under section 314 of the Public Health Service Act (including plans for cancer control), reasonable opportunity to adjust the financing of their programs to the new allotment provisions of such section, as amended by this Act, such provisions as applied to such States are hereby modified as follows: If the total of the allotments of any State (as computed under subsections (b) and (c) of section 314 of the Public Health Service Act as amended by this Act) for the fiscal year ending June 30, 1956, would be less than 90 per centum (or, in case the aggregate appropriations available for allotment under such subsections for such year are reduced below the aggregate appropriations which were available for allotments to the States for payments with respect to the cost of services under approved State plans during the preceding year, less than 90 per centum minus the percentage by which such appropriations are reduced) of the amount allotted to such State for payments with respect to the cost of services under its approved State plans during the fiscal year ending June 30, 1955, such State's allotment under subsection (b) shall be increased to the extent such total is less than 90 per centum (or 90 per centum minus such percentage reduction in appropriations) of such amount. The Surgeon General shall in accordance with regulations (1) provide for reductions in the allotments of the remaining States under such subsections to the extent required to effect the increases provided in the preceding sentence, such reductions to be based on the extent to which the allotments of such remaining States are greater than 90 per centum (or 90 per centum minus any percentage reduction in appropriations) of their allotments for the preceding year, and (2) provide for equivalent adjustments in the allotments of States under such subsections for the fiscal year ending June 30, 1957, and any successive fiscal year in which any State's combined allotments under such subsections would otherwise be less than 90 per centum (or 90 per centum minus any percentage reduction in appropriations) of its allotments for the preceding year. SEC. 4. This Act shall become effective July 1, 1955. DEPARTMENT OF HEALTH, EDUCATION, AND Welfare, Hon. CHARLES A. WOLVERTON, Chairman, Committee on Interstate and Foreign_Commerce, February 24, 1954. DEAR MR. CHAIRMAN: This letter is in response to your request of January 26, 1954, for a report on H. R. 7397, a bill to amend the Public Health Service Act to promote and assist in the extension and improvement of public-health services, to provide for a more effective use of available funds, and for other purposes. This bill would provide authority for the following three types of grants to be administered through the Public Health Service of the Department of Health, Education, and Welfare: (1) Support grants to assist States generally in meeting the costs of publichealth services. (2) Extension and improvement grants to assist States in initiating extensions of, and improvements in, their public-health services. (3) Special project grants to assist States and public and other nonprofit organizations and agencies in carrying out special projects which hold unique promise of contributing substantially to the solution of public-health problems of special national or regional concern. These three types of grants would replace the present separate authorizations for grants to States for venereal-disease control, tuberculosis control, general health, and heart-disease control (and would also have the effect of replacing the separate grants which are made to States for mental health and cancer control as well as the special grant to the Territory of Alaska for disease and sanitation investigations and control). In the allotment of funds and matching requirements for general support of public-health services, the major factor considered is the financial ability of the various States to pay the costs of necessary public-health services. Those States with more limited financial ability will, therefore, receive more Federal aid in order that the people in those States will not be denied the benefits of public health protection by virtue of their relative lack of resources with which to finance such services. Extension and improvement grants would be allotted to States in proportion to their population. The extension and improvement grant concept is one which has as its primary purpose the encouragement of a dynamic public-health program into which is continually being incorporated new techniques and operations resulting from advances in medical and other scientific research. It is a guarantee against static program content in that funds are available only on a gradually diminishing basis and for a limited period of time for any given operation. The special project grant approach is one which permits the Federal Government to assist in the development of public-health techniques which hold promise of having significant benefit beyond the borders of the State in which the initial work may be done. The results which might be expected from this type of applied or developmental research aid are comparable to those which are resulting from the Federal aid now being given in the field of basic medical research through the research-grants program of the Public Health Service. This bill would, if enacted, carry out the recommendation made by the President in his health message of January 18, 1954, that the existing public health grant programs be simplified and improved in a manner which will permit the States to use greater initiative and take more responsibility in the administration of their health programs, and render the Federal assistance more responsive to the needs of the States and their citizens. Inasmuch as representatives of this Department have been invited to present testimony on H. R. 7397 before your committee, we shall defer any detailed comment on the provisions of the bill until we testify. We do wish, however, at this time to suggest one amendment to the bill in order to provide for judicial review. We recommend that the States be afforded an opportunity for judicial review of action by the Surgeon General of the Public Health Service pursuant to section 314 (g) of the Public Health Service Act (as it would be amended by the bill) withholding payments to a State which he finds has so changed its State plan that it no longer complies with Federal requirements or which he finds has, in the administration of its plan, failed to comply substantially with such requirements. Our proposed amendment would add a new subsection at the end of the proposed new section 314 of the Public Health Service Act (following line 23 on page 10 of H. R. 7397) to read as follows: "(m) (1) If any State is dissatisfied with the Surgeon General's action under subsection (g) of this section, such State may appeal to the United States Court of Appeals for the circuit in which such State is located. The summons and notice of appeal may be served at any place in the United States. The Surgeon General shall forthwith certify and file in the court the transcript of the proceedings and the record on which he based his action. "(2) The findings of fact by the Surgeon General, unless substantially contrary to the weight of the evidence, shall be conclusive; but the court, for good cause shown, may remand the case to the Surgeon General to take further evidence, and the Surgeon General may thereupon make new or modified findings of fact and may modify his previous action, and shall certify to the court the transcript and record of the further proceedings. Such new or modified findings of fact shall likewise be conclusive unless substantially contrary to the weight of the evidence. "(3) The court shall have jurisdiction to affirm the action of the Surgeon General or to set it aside, in whole or in part. The judgment of the court shall be subject to review by the Supreme Court of the United States upon certiorari or certification as provided in title 28, United States Code, section 1254." The amendment we propose would, in effect, incorporate in this bill the judicialreview provisions now contained in the Hospital Survey and Construction Act and repeated in the provisions of H. R. 7341 to amend that act. For the reasons set forth in the President's health message of January 18, this Department endorses H. R. 7397, preferably with the amendment proposed above, and recommends its enactment by the Congress. The Bureau of the Budget advises that it perceives no objection to the submission of this report to your committee, and that enactment of H. R. 7397 would be in accord with the program of the President. Sincerely yours, 44673-54- 2 OVETA CULP HOBBY, Secretary. EXECUTIVE OFFICE OF THE PRESIDENT, Hon. CHARLES A. WOLVERTON, BUREAU OF THE BUDGET, Washington 25, D. C., February 23, 1954. Chairman, Committee on Insterstate and Foreign Commerce, House of Representatives, Washington 25, D. C. MY DEAR MR. CHAIRMAN: This will acknowledge your letter of January 26, 1954, requesting the Bureau of the Budget to comment on H. R. 7397, to amend the Public Health Service Act to promote and assist in the extension and improvement of public health services, to provide for a more effective use of available Federal funds, and for other purposes. This measure, if enacted, will eliminate present statutory rigidities inherent in the existing Federal health-grant programs and provide sufficient flexibility to cope with changing public-health problems as they arise. Moreover, the bill is designed to accomplish the objectives which the President stated in his special health message to the Congress of January 18, 1954, by providing a new simplified formula for making funds available to States for health purposes. This formula embraces the three criteria named by the President; viz, first, that the States be aided in inverse proportion to their financial capacity; second, that States also be helped, in proportion to their population, to extend and improve health services supported by grants-in-aid; and, third, that a portion of Federal financial assistance be set aside for support of unique projects of regional or national significance giving promise of better ways to improve the health of our people. I am at thorized to advise you that enactment of H. R. 7397 would be in accord with the program of the President. In this connection, I wish also to advise that the Department of Health, Education, and Welfare will present for the consideration of the committee provisions for judicial review patterned after the HillBurton Hospital Survey and Construction Act. Sincerely yours, (Signed) DONALD R. BELCHER, Hon. CHARLES A. WOLVERTON, Assistant Director. TREASURY DEPARTMENT, Washington, D. C., February 25, 1954. Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. MY DEAR MR. CHAIRMAN: Reference is made to your letter of January 26, 1954, requesting a statement of this Department's views on H. R. 7397, to amend the Public Health Service Act to promote and ɛssist in the extension and improvement of public health services, to provide for 2 more effective use of available Federal funds, and for other purposes. The proposed legislation would replace the present separate authorizations for grants-in-sid for specific diseases and would substitute in lieu thereof (1) grants to assist States generally in meeting the costs of their public-health services; (2) grants to States to assist them in initiating extensions of, and improvements in, their public-health services; and (3) grants to States and to public and other nonprofit organizations for the solution of public-health problems of regional or national significance. The proposed legislation was introduced to carry out certain legislative recommendations contained in the message of the President on the health of the American people. In view of this, the Treasury Department recommends the enactment of the proposed legislation. The Department has been advised by the Bureau of the Budget that there is no objection to the submission of this report to your committee and that the enactment of H. R. 7397 would be in accord with the program of the President. Very truly yours, (Signed) M. B. FOLSOM, Acting Secretary of the Treasury. COMPTROLLER GENERAL OF THE UNITED STATES, Hon. CHARLES A. WOLVERTON, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives. MY DEAR MR. CHAIRMAN: I have your letter of January 26, 1954, transmitting a copy of the bill H. R. 7397, 83d Congress, entitled a bill to amend the Public Health Service Act to promote and assist in the extension and improvement of public-health services, to provide for a more effective use of available Federal funds, and for other purposes, and requesting any comment I might care to offer with respect thereto. The proposed bill would amend section 314 of the Public Health Service Act to authorize public-health grants under stated broad and general criteria in lieu of the existing system of categorical grants. The new types of grants are set forth in the bill as follows: 1. Grants to States to assist them in meeting the cost of public-health services (subsequently referred to as type (b) grants). 2. Grants to States to assist them in initiating projects for the extension and improvement of their public-health services (subsequently referred to as type (c) grants). 3. Grants to States and to public and other nonprofit organizations and agencies to assist in combating unnecessarily severe public health problems in specific geographic areas, in the carrying out of special projects which hold unique promise of making a substantial contribution to the solution of public-health problems common to a nun ber of States, and in meeting problem s of national significance or concern (subsequently referred to as type (d) grants). The authorized Federal contribution under the three proposed types of grants would be 1. Type (b). A maximum percentage of 66% and a minimum of 33%, depending upon the relative State population and per capita income. 2. Type (c). A percentage of approved costs of individual projects, namely, (2) 75 percent of the cost of an approved project for the first and second year of the project, (b) 50 percent of the cost for the third and fourth years, (c) 25 percent of the cost for the fifth and sixth years. 3. Type (d).-A portion of the cost, such portion apparently to be determined by the department. This Office has no information as to the need or desirability of the proposed legislation and I make no recommendations as to the merits thereof. However, an examination of the bill indicates that clarification of certain provisions thereof is desirable. The present language does not appear to be sufficiently specific to permit a ready determination in all instances of those costs which may be applicable either to type (b) or type (c) grants. This is especially true since projects for extensions and improvement of public-health services may overlap general-health services. The distinction between the two types would be important in effecting reimbursement to the States due to the variation in the percentage of Federal participation for each of the two types of grants. It is recommended that the bill be clarified in this respect. Since the several types of grants authorized by the proposed bill are based upon costs incurred by the States, detailed State accounting would seen to be required. Further, the type (c) grants, as to which the variation in the percentage of Federal participation, ranging from 25 percent to 75 percent, depends upon the biennium of the project during which project costs are incurred, would seem to necessitate the accumulation of project costs on a fiscal-year basis as well as on an individual-project basis. In order that these accounting requirements may be given proper recognition it would appear desirable that the bill provide generally for the maintenance by the States of accounting records sufficient to establish its costs under the designated programs. Section 314 (k) (2) of the bill provides that payments to the States from available allotments shall be made prior to audit or settlement by the General Accounting Office and shall be made through the disbursing facilities of the Treasury Department. Audit of these funds or settlement of the accounts of the disbursing officer prior to payment by the Department is neither authorized nor re uired under existing legislation. Further, the disbursing of Federal funds is covered by existing legislation. Accordingly, the referred-to language is unnecessary and it is suggested that it be deleted. Sincerely yours, LINDSAY C. WARREN, Comptroller General of the United States. DEPARTMENT OF COMMERCE, Hon. CHARLES A. WOLVERTON, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. DEAR MR. CHAIRMAN: This letter is in reply to your request of January 26, 1954, for the views of this Department with respect to H. R. 7397, & bill to amend the Public Health Service Act to promote and assist in the extension and improvement of public health services, to provide for a more effective use of available Federal funds, and for other purposes. The bill appears to be concerned primarily with procedures and practices of the Department of Health, Education, and Welfare. After careful consideration of the bill and the possible effects of its enactment upon the activities of this Department, we have concluded that our interest in the subject matter of the bill is toc remote to justify our offering for your considerstion comments with respect thereto. If we can be of further assistance in this matter, please call on us. Signed STEPHEN F. DUNN, General Counsel. The CHAIRMAN. This morning we are to hear again from the distinguished Secretary of Health, Education, and Welfare, Mrs. Oveta Culp Hobby. Not long ago we heard from Mrs. Hobby regarding the proposed amendments to the Hospital Survey and Construction Act. The bill which we reported out of committee to effect such amendments is now pending before the full House. The Secretary is present at this time to testify on the highly important subject of Federal grants-in-aid to the States and Territories for public-health work. The grants for public-health purposes authorized by the Congress may certainly claim a share of the credit for the great progress we are making as a Nation toward better health. The bill under consideration, H. R. 7397, was introduced by me to bring about certain improvements in the public-health grants. The bill would have two primary effects: First. It would bring together the present six public-health grants into a unified grant structure, thereby giving the States greater flexibility in the use of funds for health purposes. While the categorical grant approach has served a useful function in the development of important new programs in the public-health field, these new programs are now well established. Its original function having been fulfilled, the categorical approach, with six separate programs and appropriations, is now imposing an unnecessary rigidity upon the States in meeting their own particular health needs. Second. The bill would redesign the present grant structure so as to carry out more effectively the basic objectives of the Congress in enacting grant-in-aid programs. What were our basic objections when we enacted the legislation for the various grant-in-aid programs? It seems to me that there were three aims which underlie such legislation: 1. To help support State and local programs with Federal funds, taking into consideration financial need; 2. To encourage States to extend and improve their services to their people by adding new programs or extending existing ones; and 3. To foster special research or other types of projects which have national or multi-State significance. |