projects sponsored by the Vocational Rehabilitation Administration's research and demonstration grant program. This is an increase of 47,000 over the 411,000 persons who received services during 1964.

State agencies have continued to serve increasing numbers of the severely disabled as well as to expand services to all categories of the disabled. The following table shows the number of persons rehabilitated in various categories of disability in 1965 compared to previous program accomplishments.

The number of rehabilitants in 1965 classified by categories other than their disability throws interesting light on the character of the caseload served by the vocational rehabilitation agencies and indicates the accomplishment in restoring independence where it is most difficult to achieve among the poor segments of the population.

The rehabilitants during 1965 who were on public assistance were receiving assistance payments at an annual aggregate rate of $20 million a year before rehabilitation in contrast to $7 million when their cases were then closed. Upon rehabilitation almost 10,000 who had been receiving public assistance were no longer doing so, with an annual savings of $13 million in assistance payments. Well over 5,000 of the disabled persons rehabilitated in 1965 entered professional occupations, such as engineering, teaching, and medicine and related health activities. Around 15,200 went into the skilled trades and nearly 8,000 into

agriculture.

The 1965 rehabilitants will perform an estimated 188 million man-hours of work per year and thereby have increased their annual earning rate from $49 million before rehabilitation to $297 million. Over 70 percent of the 135,000 rehabilitants were not working at the time they were accepted for services, others were in marginal or otherwise unsatisfactory employment.

The 1965 Vocational Rehabilitation Amendments and the supplemental appropriation for 1966 make it possible to estimate that the Federal-State vocational rehabilitation program will rehabilitate 168,500 disabled persons in 1966; in fiscal year 1967, the continued expansion and increased resources available will permit the rehabilitation of 207,500 persons,

The State vocational rehabilitation agencies will receive a big help in meeting their rehabilitation goals from the rehabilitation resources they have developed. State agencies sent over 10,000 clients to workshops for evaluation and training services and over 37,000 clients to rehabilitation facilities in 1965. A total of $19.2 million was spent for these services. In that same year,

1965, they invested $5.1 million in establishing rehabilitation facilities and workshops under sections 2 and 3 of the Vocational Rehabilitation Act. This amount includes Federal funds and the State matching funds which were derived from private contributions, donated to support this vocational rehabilitation effort. The States are expected to continue to expand resources through further investment in the establishment of facilities and workshops.

The State agencies' staff will grow to meet the challenge of new program opportunities. Estimates of employees which the State agencies will use for the basic support program, including the extended evaluation services program, the increased workload of OASDI cases as a result of the transfer of trust fund money to be used for rehabilitation services, the innovation project program and the expansion of vocational rehabilitation services projects follow:

The vocational rehabilitation programs are continuing the trend toward specialization of staff. About 33 percent of the 3.000 counselors in the State programs carry specialized caseloads or work primarily in institutions or State operated facilities, or are contributing personnel such as interviewers, counseling aids, and placement specialists. Many counselors are assigned to disability groups whose rehabilitation requires unique and special skills not common to all disability categories. Full or part-time staff to consult with and advise the agencies has grown to become an integral part of program operations. The use of medical consultation to rehabilitation counselors continued to increase in 1965 when 125 man-years were devoted to such consultation. State agencies have also begun to use specialists in the development and use of rehabilitation facilities and workshops.

The vocational rehabilitation man-years worked by State agency employees in 1965 totaled 10.000 including those under sections 2, 3, 4, and in the OASDI disability determination units. About 1,450 of the staff were engaged in disability determination operations. Of the 8.550 employees engaged in activities under the Vocational Rehabilitation Act, about 1,550 were located at rehabilitation facilities operated by State agencies. About 300 of the employees were engaged in research and demonstration projects conducted by the State agencies.

Trends

The accomplishments over the past 11 years were possible as a result of the 1954 amendments to the Vocational Rehabilitation Act. The scope of that legislation, however, was not broad enough to permit the level of growth needed in the States to accomplish sorely needed program gains.

The 1965 amendments to the Vocational Rehabilitation Act include authority for the States to provide extended services for the evaluation of the rehabilitation potential of severely disabled persons. This provision extends authority to States to accept persons for rehabilitation services necessary to thoroughly evaluate them even though, on first review, there appear to be less or no prospects for employment when ordinary vocational rehabilitation services are completed. The requirement that the State vocational rehabilitation program make services available to all disabled individuals in the State on an equal basis, regardless of where in the State they live, was waived by the 1965 amendments. This will permit individual localities to make available public funds to the State Vocational rehabilitation agency which in turn can use these funds, plus the Federal matching they would earn, to provide expanded rehabilitation services above those available in all other parts of the State.

A discussion of the expanded business enterprises programs follows on a later page.

All of the provisions of the 1965 amendments point toward an improvement in the provision of vocational rehabilitation services to the disabled, both in

quality and quantity. Review of some of the program accomplishments in past years indicates the trends the program is taking and, keeping in mind the broadening horizons provided through the legislation, an insight into future program activities can be had.

Youth

Vocational rehabilitation services are being provided in increasing proportion to young disabled individuals. The table shown earlier indicated that the number of rehabilitants under age 20 increased from 9,742 in 1955 to 28,800 in 1965 and went from 17 percent of the total in 1955 to 21 percent in 1965. The importance of providing rehabilitation services to the disabled as soon as possible after disability is fully recognized. The added advantages of providing services when the disabled person is young make this trend a very important one. Not only are young persons often more receptive to rehabilitation services but their provision at an early age often prevents secondary disability from developing. Additional activities oriented toward youth are as follows:

Activities with Armed Forces rejectees

The Vocational Rehabilitation Administration and the Public Health Service are sharing responsibility for development, review, and evaluation of a new nationwide program which provides counseling, referral, and followup services to young men rejected for medical reasons at the 73 Armed Forces examining stations. This program is financed with funds transferred to the Public Health Service by the Office of Economic Opportunity.

The program is being administered in 13 States by vocational rehabilitation agencies, and in the remaining States by health or welfare agencies. In six of the States where health departments are the contractors, vocational rehabilitation agencies have subcontracted to provide various screening, referral, or followup activities. The Vocational Rehabilitation Agency is represented on the program advisory board in all States.

Cooperative vocational rehabilitation-Special education programs

All but three States (Alaska, Hawaii, and Maryland) and the territories (Guam, Puerto Rico, and the Virgin Islands) reported active participation in cooperative programs involving vocational rehabilitation and education agencies in 1965. This was the most prevalent rehabilitation activity for disabled youth. The majority of the joint vocational rehabilitation-special education programs are supported under the basic program. A few were initiated under the extension and improvement program and later absorbed under section 2, while 18 separate projects in 11 States received research and demonstration grants.

All of the States' vocational rehabilitation-special education undertakings are meeting a previously neglected area of need and are demonstrating the real benefit to be derived from cooperative undertakings. Rehabilitation services

are being made available faster and at a time which enables these disabled individuals to be able to look forward to living their entire adult lives in reasonably normal fashion. Further detail is provided in the review of some of the activities in the field of mental retardation below.

Correctional rehabilitation

Development of vocational rehabilitation programs designed to serve the adult and juvenile public offender continues to accelerate with each successive year. This trend is most timely in that it coincides with a heightened national awareness of the great social and economic cost of crime and delinquency, an awareness that is reflected in recent congressional and White House action; vis-a-vis crime, corrections, and law enforcement.

Many State Governors are beginning to urge closer cooperation between rehabilitation and correctional departments within a given State. Cooperative programs now exist in a total of 16 States. Of these, seven have programs under basic support or extension and improvement authority while seven are conducting joint programs under research and demonstration grant authority. Two States, Washington and Georgia, have both types of programs. The trend is in the direction of establishing continuing, comprehensive rehabilitation programs under basic support (sec. 2) authority since long-range rehabilitation objectives can best be met through use of this device.

The new provision for extended evaluation will encourage State vocational rehabilitation agencies to serve more public offenders. Because of the severity of emotional disabilities among public offenders and because of doubts as to their

rehabilitation potential, some States have been reluctant to embark on programs of correctional rehabilitation. The 6-month period of evaluation prior to deter mination of eligibility will obviate much of this reluctance.

Rehabilitation and poverty

The Nation's growing awareness and mounting concern for the grave problems of widespread poverty bring new perspectives to the importance of vocational rehabilitation of the disabled. Neglected disability leads to poverty, deprivation, and deterioration. In restoring disabled persons to employment, State vocational rehabilitation agencies serve some of the most seriously disadvantaged people in the Nation-those who suffer the effects of physical or mental limitations combined with the gross educational, economic, and social problems associated with poverty.

State agencies, long concerned with reducing dependency among the disabled, are continuing emphasis on rehabilitation of public assistance applicants and recipients, and are directing increasing attention to activities to solve rehabilitation problems of the disabled poor in cooperation with other community programs.

Not confined to persons in economic need, the vocational rehabilitation program both prevents disabled persons from becoming impoverished financially and serves many who are in financial need. The large portion of the resources of the State-Federal program is devoted to rehabilitating low-income disabled persons and to developing correlated community services. It is estimated that 95 percent of the disabled persons served by State vocational rehabilitation agencies were, upon acceptance for services, in poverty as defined in economic opportunity programs. Disability is common among the poor. It is a significant factor leading to poverty and the attendant compounding of problems. There is great need for more resources for rehabilitating the low-income disabled. OASDI disability determination and rehabilitation program

The State vocational rehabilitation agencies are responsible for evaluating the disability and rehabilitation potential of each person who applies the disability benefits under the provisions of the Social Security Act. About 500,000 of these cases were evaluated by State agencies in 1965 to identify those applicants who seemed to have some prospect for returning to work after receiving rehabilitation services. Over 50,000 of this number were considered to have rehabilitation potential and were accepted into the referral loads of State agencies. Some 10.900 OASDI applicants were rehabilitated in 1965. This is about 8 percent of all rehabilitants for the year.

Section 222 of the Social Security Act. as amended by the 1965 amendments. provides for payment from the trust funds for the full costs of vocational rehabilitation services for disabled worker beneficiaries and childhood disability beneficiaries. The amendments authorizes the transfer of such sums as may be necessary up to a maximum of 1 percent of the OASDI benefits paid in the previous fiscal year for the purpose of paying for such services provided by State agencies operating under a State plan pursuant to the Vocational Rehabilitation Act.

By making these financial resources available, the Congress has fortified its earlier objectives, as stated in the 1954 amendment, that disabled individuals applying for disability benefits must be referred for necessary vocational rehabilitation services to the end that the maximum number of them may be restored to productive and gainful employment. A further objective is that in restoring beneficiaries to gainful work, benefit payments may be discontinued with resultant savings to the trust fund.

The Vocational Rehabilitation Administration has responsibility for the administration of this program. This includes the development of plans, regulations, policies, and procedures to insure an effective program of service for beneficiaries. Giving this program necessary overall direction and stimulus is an essential element of the Vocational Rehabilitation Administration's responsibility. Continuing liaison and consultation with the Social Security Administration will be maintained with respect to the development and reporting phases of the program.

The aged

Under the State-Federal vocational rehabilitation programs there has been, since 1945, a steady increase each year in the number of older disabled persons rehabilitated into gainful employment. In 1945, 7,344 disabled persons 45 years

of age and older were rehabilitated into employment, and it is estimated that over 36,000 persons, five times the 1945 figure, will be rehabilitated into employment during 1965.

As the number of older people in our population increases, the number that will need rehabilitation will also increase. In view of this situation, the Vocational Rehabilitation Administration is designing programs not only to rehabilitate vocationally as many individuals as possible now, but also to assist the large number of individuals who will be needing vocational rehabilitation in the future.

The Older Americans Act of 1965-Public Law 89-73-recently enacted by the Congress, will assist the States and local communities in coping with the problems and unmet needs of the aging population. State vocational rehabilitation agencies will cooperate with the State agency designed to coordinate State programs and activities related to the purposes of this legislation.

Mentally ill

State agencies continue to report substantial progress in the rehabilitation of the mentally ill. In 1965 the percent that the mentally ill represented of the total number of rehabilitants had risen to 14 percent from 3.5 percent in 1955. Services are provided to in-hospital and post-hospital patients who need and can benefit from rehabilitation services to resume or enter employment and assume their rightful place as contributing citizens. Services are also provided the mentally ill who are not and have not been hospitalized but who need help in order to work in the community and stay out of the hospital.

With the exception of one or two, all of the States assign counselors to State mental hospitals on a full- or part-time basis. The counselors work as rehabilitation specialists and are accepted as an integral part of the total therapeutic community. The trend to establish rehabilitation facility units within hospitals continues. These units offer prevocational and vocational training with professional personnel representative of a variety of disciplines providing the necessary services. An increasing number of State agencies now operate halfway or "rehabilitation" houses where a person who leaves the hospital is given guidance and support in learning to live again as a participating member of the community. Most of these expanded programs are financed under the basic support program under section 2 and others are under the section 3 project program. Under the new legislation contained in the 1965 Vocational Rehabilitation Amendments, it will be possible to serve many more of the severely disabled group than has been possible in the past. Up to the present, State rehabilitation agencies have been expected to determine, after initial diagnostic work-up-but before any services were rendered-whether or not a handicapped person could reasonably be expected to become employable after a program of services were completed. For large numbers of handicapped persons with severe disabilities or complicated problems, or both, this was virtually impossible. As a result, many of these handicapped individuals did not receive services.

These rapidly expanding programs in this specialized field call for expanding staffs with special knowledge and skills in the field. Training of both new and old counselors will have to be substantially increased. Leadership in this program will be strengthened as more State agency counselors avail themselves of the intensive 6-month counselor internship programs at the three psychiatric centers which now provide this training under our training grant program— Massachusetts Mental Health Center, Harvard Medical School; Nebraska Psychiatric Institute, Nebraska College of Medicine; and Department of Psychiatry, University of Oregon Medical School.

Heart disease, cancer and stroke

These three major disabling conditions are treated as a group here because of their having been brought sharply into national focus through the Report of the President's Commission on Heart Disease, Cancer, and Stroke as a triad of crippling diseases for which immediate medical and rehabilitation measures must be taken to combat their frightful toll among the American people. This report, inciting such statistics as: there are over 14 million cases of known heart disease among our adult population and nearly an equal number of suspected cases; there are 2 million victims of stroke; and some 900,000 cancer cases-has shown only too graphically the extent to which these insidious diseases have invaded the ranks of our population. The report has underscored the need for the StateFederal programs of vocational rehabilitation to take stock of the services it has