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We are greatly encouraged that the concept of mental health representation has been recognized in H.R. 10553. We believe this concept should be strengthened by adding a requirement that a significant proportion of the providers and consumers at both regional and state levels, as well as professional staff at both levels, be mental health qualified.

Because we believe that state authorized mental health planning should be the basis of identifiable mental health components of regional and state health plans, we would further recommend that amendments to P.L. 93-641 incorporating the state mental health planning process in the Federal health planning legislation should mandate that citizen participation at local, regional, and state levels in the mental health planning process be consistent with and compatible with the representation required of the governing bodies of HSA's and SHCCs.

We will further testify that the Congress should incorporate in amendments to P.L. 93-641, or other relevant legislation, a clear statement of its intent that specific Federal funds be provided for state mental health authorities to develop and maintain on-going planning at regional and state levels. We will recommend that at least 80% of those funds be utilized for regional and local mental health planning purposes.

Sincerely yours,

Allan Maltgen

Allan Moltzen

Chair, National Committee on
Legislation and Services

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Attached you will find a statement prepared by
the National Health Council, Inc. and the American
Diabetes Association dealing with the Health Plan-
ning and Resources Development Act which is now under
consideration in your Subcommittee. We would appre-

ciate it if the attached statement could be included
in the hearing record regarding the "Planning Act".

The problem which our statement highlights
involves the definition of "indirect provider" in
Section 1531 (3) (B) and the effect which this defini-
tion has on membership in the governing body of the
Health Systems Agencies ("HSA"). An indirect pro-
vider is defined presently as one holding a fiduciary
position with an organization engaged in any way and
in any degree with the provision of health care,
health research or instruction. The result of this
definition is that lay people, who are not otherwise
engaged in the delivery of health care, who serve as
volunteer members of the boards of directors of
nonprofit health organizations such as the American
Diabetes Association, are denied participation as con-
sumers in the governing body of an HSA. However, these
same individuals are perceived as consumers and not
as representatives of providers in their locality and
as a result cannot obtain provider positions on HSA
boards. In fact, these individuals are perhaps the
best example of consumers because they are active in

health consumer movements and have knowledge of the health care system. They are not, however, practising in the field of health care or receiving financial remuneration for their participation on these boards of voluntary health organizations and these voluntary health organizations are not primarily engaged in health care delivery, research or instruction. They are clearly not organizations which form, in any way, a major part of a local health care system.

We thank you for your consideration of this issue. We hope that some change in the "Planning Act" can be made to encourage the participation of such individuals on HSA governing boards. The bill currently being considered in the Senate, S. 2410, does include a provision at Section 140 which would remedy the problem we have described above. We would hope that the House would pass amendments to the "Planning Act" which would also remedy this problem.

Sincerely,

Richard E. Vewelle

Richard E. Verville, Counsel
American Diabetes Association

REV: kh
Enclosure

Barney Sellers

Barney Sellers

National Health Council, Inc.

February 2, 1978

The Honorable Paul Rogers

Chairman

Subcommittee on Health & The Environment

Dear Mr. Chairman:

We would like to bring to your attention a problem under the 1974 Health Planning and Resources Development Act which affects several national voluntary health associations and their volunteers.

As you consider reauthorization of the law,

we would appreciate if you would review the issue in question. The problem is the manner in which the definition of "indirect provider" has been applied to certain volunteers in health associations.

Of particular concern to us is the impact on volunteers in the American Diabetes Association, the American Lung Association, and potentially others in our Council. Administrative interpretations of the statute have prevented volunteers

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who otherwise have no financial or

fiduciary interest in the health system

-

from participating,

and in some cases, from being considered as consumer representative members on the boards of local or regional Health Systems Agencies. In our view, this interepretation is not consistent with Congressional intent nor the law. It prevents true volunteers and consumers, who are often the parents of crippled, diseased or disabled youngsters, and who perceive themselves as advocates for needy patients, from joining fully in the local planning process. To characterize these persons as providers, we believe is a distortion of Congressional intent, and is unwise. It has the practical effect, in

addition, of placing these persons in a smaller, more

competitive category of Health Systems Agencies ("HSA") representatives who do not perceive voluntary health association members as appropriate representatives of providers.

The legislative history of the provision in question (Section 1531 (3)) shows that the House and Senate agreed that certain restrictions should be placed on the participation of providers of health services in the local planning process. We do not quarrel with the intention, nor with its application to volunteers who, in their private lives or professional capacities, are otherwise covered by the definitions in question. During the conference, the House proposed a category of "indirect provider" intended to expand the basic definition of "direct provider". The conference report stated:

"A direct provider is an individual whose primary
current activity is the provision of health care
to individuals or the administration of health care
facilities and who, as required by State law, has
received professional training and is licensed or
certified. Indirect providers are individuals who
have certain fiduciary positions or financial
interests, who are members of immediate families,
or who are engaged in issuing health insurance.

The conference substituted the House amendment.

The statutory definition of a "provider of health care" states that a direct provider is "an individual [whose] primary current activity" is the provision of health care. An indirect provider is one who (a) has a fiduciary relationship with an entity engaged in providing care or "in such research or instruction", or an entity producing drugs; (b) receives "more than one-tenth of his gross annual income" either from the activities in (a) above, fees or research or instruction or for production of drugs; (c) is a member of the immediate family of

26-219 78 pt.2 34

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