"(C) one-half of the remainder of such expenditures. The services referred to in subparagraphs (A) and (B) shall include only "(D) services provided by the staff of the State agency, or of the local agency administering the State plan in the political subdivision, and “(E) subject to limitations prescribed by the Secretary, services which in the judgment of the State agency cannot be as economically or as effectively provided by the staff of such State or local agency and are not otherwise reasonably available to individuals in need of them, and which are provided, pursuant to agreement with the State agency, by the State health authority or the State agency or agencies administering or supervising the administration of the State plan for vocational rehabilitation services approved under the Vocational Rehabilitation Act or by any other State agency which the Secretary may determine to be appropriate (whether provided by its staff or by contract with public (local) or nonprofit private agencies); except that any such services which are defined as vocational rehabilitation services under the Vocational Rehabilitation Act and which are available from the State agency or agencies administering or supervising the administration of the State plan for vocational rehabilitation services, to individuals under programs for their rehabilitation carried on under such State plan, may be provided only by such State agency or agencies (in the manner described in subparagraph (E)) except to the extent agreed to by such State agency or agencies. The portion of the amount expended for administration of the State plan to which subparagraph (A) applies and the portion thereof to which subparagraphs (B) and (C) apply shall be determined in accordance with such methods and procedures as may be permitted by the Secretary. "(b) (1) Prior to the beginning of each quarter, the Secretary shall estimate the amount to which a State will be entitled under subsection (a) for such quarter, such estimates to be based on (A) a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such subsection, and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than the State's proportionate share of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived, and (B) such other investigation as the Secretary may find necessary. "(2) The Secretary shall then pay, in such installments as he may determine, to the State the amount so estimated, reduced or increased to the extent of any overpayment or underpayment which the Secretary determines was made under this section to such State for any prior quarter and with respect to which adjustment has not already been made under this subsection. "(3) The pro rata share to which the United States is equitably entitled, as determined by the Secretary, of the net amount recovered during any quarter by the State or any political subdivision thereof with respect to aid or assistance furnished under the State plan, but excluding any amount of such aid or assistance recovered from the estate of a deceased recipient which is not in excess of the amount expended by the State or any political subdivision thereof for the funeral expenses of the deceased, shall be considered an overpayment to be adjusted under this subsection. "(4) Upon the making of any estimate by the Secretary under this subsection, any appropriations available for payments under this section shall be deemed obligated. "OPERATION OF STATE PLANS "SEC. 1604. If the Secretary, after reasonable notice and opportunity for hearing to the State agency administering or supervising the administration of the State plan approved under this title, finds— "(1) that the plan has been so changed that it no longer complies with the provisions of section 1602; or "(2) that in the administration of the plan there is a failure to comply substantially with any such provision ; the Secretary shall notify such State agency that further payments will not be made to the State (or, in his discretion, that payments will be limited to cate gories under or parts of the State plan not affected by such failure), until the Secretary is satisfied that there will no longer be any such failure to comply. Until he is so satisfied he shall make no further payments to such State (or shall limit payments to categories under or parts of the State plan not affected by such failure). "DEFINITIONS "SEC. 1603. (a) For the purposes of this title, the term 'aid to the aged, blind, or disabled' means money payments to, or medical care in behalf of or any type of remedial care recognized under State law in behalf of, needy individuals who are 65 years of age or older, are blind, or are 18 years of age or over and permanently and totally disabled, but does not include "(1) any such payments to or care in behalf of any individual who is an inmate of a public institution (except as a patient in a medical institution) or any individual who is a patient in an institution for tuberculosis or mental diseases, or "(2) any such payments to any individual who has been diagnosed as having tuberculosis or psychosis and is a patient in a medical institution as a result thereof, or "(3) any such care in behalf of any individual, who is a patient in a medical institution as a result of a diagnosis that he has tuberculosis or psychosis, with respect to any period after the individual has been a patient in such an institution, as a result of such diagnosis, for forty-two days. "(b) For purposes of this title, the term 'medical assistance for the aged' means payment of part or all of the cost of the following care and services for individuals who are sixty-five years of age or older and who are not recipients of aid to the aged, blind, or disabled but whose income and resources are insufficient to meet all of such cost "(1) inpatient hospital services; "(2) skilled nursing-home services; "(3) physicians' services; "(4) outpatient hospital or clinic services; "(5) home health care services; "(6) private duty nursing services; "(7) physical therapy and related services; "(8) dental services; “(9) laboratory and X-ray services; "(10) prescribed drugs, eyeglasses, dentures, and prosthetic devices; "(11) diagnostic, screening, and preventive services; and "(12) any other medical care or remedial care recognized under State law: except that such term does not include any such payments with respect to "(A) care or services for any individual who is an inmate of a public institution (except as a patient in a medical institution) or any individual who is a patient in an institution for tuberculosis or mental diseases; or "(B) care or services for any individual, who is a patient in a medical institution as a result of a diagnosis of tuberculosis or psychosis, with respect to any period after the individual has been a patient in such an institution, as a result of such diagnosis, for forty-two days." (b) No payment may be made to a State under title I, X, or XIV of the Social Security Act for any period for which such State receives any payments under title XVI of such Act or any period thereafter. (c) Section 1109 of such Act is amended by striking out "sections 2(a) (7), 402 (a) (7), 1002 (a) (8), and 1402(a) (8)” and inserting in lieu thereof "sections 2(a) (11) (A), 402 (a) (7), 1002 (a) (8), 1402 (a) (8), and 1602 (a) (14)” and by striking out "a State plan approved under title I, IV, X, XIV" wherever it appears and inserting in lieu thereof “a State plan approved under title I, IV, X, XIV, or XVI”. (d) Section 1111 of such Act is amended by striking out "and XIV" and inserting in lieu thereof "XIV, and XVI”. (e) Section 618, of the Revenue Act of 1951 is amended by striking out “or XIV" and inserting in lieu thereof "XIV, or XVI (other than section 1603 (a) (3) thereof)". (f) In the case of any State which has a State plan approved under title XVI of the Social Security Act, any overpayment or underpayment which the Secretary determines was made to such State under section 3, 1003, or 1403 of such Act with respect to a period before the approval of the plan under such title XVI, and with respect to which adjustment has not been already made under subsection (b) of such section 3, 1003, or 1403, shall, for purposes of section 1603 (b) of such Act, be considered an overpayment or underpayment (as the case may be) made under section 1603 of such Act. PART E-MISCELLANEOUS AND TECHNICAL AMENDMENTS INCREASE IN LIMITATION ON TOTAL PUBLIC ASSISTANCE PAYMENTS TO PUERTO RICO, THE VIRGIN ISLANDS, AND GUAM SEC. 151. Effective for fiscal years ending after June 30, 1962, section 1108 of the Social Security Act is amended to read as follows: "LIMITATION ON PAYMENTS TO PUERTO RICO, THE VIRGIN ISLANDS, AND GUAM "SEC. 1108. The total amount certified by the Secretary of Health, Education, and Welfare under title I (other than section 3(a)(3) thereof), IV, X, XIV, and XVI (other than section 1603 (a)(3) thereof) for payment to Puerto Rico with respect to any fiscal year shall not exceed $9,800,000, of which $625,000 may be used only for payments certified with respect to section 3(a) (2) (B) or 1603 (a) (2) (B); the total amount certified by the Secretary under such titles for payments to the Virgin Islands with respect to any fiscal year shall not exceed $330,000, of which $18,750 may be used only for payments certified with respect to section 3(a) (2) (B) or 1603 (a) (2) (B) ; and the total amount certified by the Secretary under such titles for payment to Guam with respect to any fiscal year shall not exceed $450,000, of which $25,000 may be used only for payments certified with respect to section 3(a) (2) (B) or 1603 (a) (2) (B). Nothwithstanding the provisions of sections 502 (a) (2), 512(a) (2), 522(a), and 527(a), and until such time as the Congress may by appropriation or other law otherwise provide, the Secretary shall, in lieu of the initial (or, in the case of section 527 (a), the minimum) allotment specified in such sections, allot such smaller amounts to Guam as he may deem appropriate." PAYMENTS TO RELATIVE OF CHILD WHEN CHILD IS DEPENDENT SEC. 152. Section 406(b) of the Social Security Act is amended by striking out "for any month" and by striking out "if money payments have been made under the State plan with respect to such child for such month". DEFINITIONS OF "STATE" AND "UNITED STATES" SEC. 153. (a) Paragraph (1) of section 1101 (a) of the Social Security Act is amended by striking out "X, and XIV" and inserting in lieu thereof "X, XI, XIV, and XVI". (b) Paragraph (2) of such section is amended by striking out ", the District of Columbia, and the Commonwealth of Puerto Rico". TITLE II-GENERAL MEANING OF TERM "SECRETARY" SEC. 201. As used in this Act and in the provisions of the Social Security Act amended by this Act, the term "Secretary", unless the context otherwise requires, means the Secretary of Health, Education, and Welfare. EFFECTIVE DATES SEC. 202. (a) The amendments made by sections 101 (b), 102(b) (1), 103, 106, and 134 shall become effective July 1, 1963. (b) The amendments made by sections 102(c) and 123 shall be applicable in the case of fiscal years beginning after June 30, 1962. (c) The amendments made by sections 101(a), 102(b) (2) and (d), 132 135, and 152 shall be applicable in the case of expenditures, under a State plan approved under title I, IV, X, or XIV of the Social Security Act or developed as provided in part 3 of title V of such Act, as the case may be, made after June 30, 1962. (d) The amendments made by sections 107(a) and 109 shall be applicable in the case of expenditures, under a State plan approved under title IV of the Social Security Act, made after September 30, 1962. (e) The amendments made by sections 105 and 108 shall be applicable in the case of expenditures under a State plan approved under title IV of the Social Security Act, made during the period beginning October 1, 1962, and ending with the close of June 30, 1967. Passed the House of Representatives March 15, 1962. RALPH R. ROBERTS, Clerk. The CHAIRMAN. The first witness is the Secretary of Health, Education, and Welfare. The Chair desires to state, Mr. Secretary, that on January 5 you paid a visit to my office and provided me with a memorandum outlining proposed amendments to the public assistance legislation which, as I understand it, are generally included in the bill before the committee at this time. As chairman of the Senate Finance Committee on January 17, I wrote you a letter relating to the proposals in which I asked one general question and a series of questions in detail on the nine proposals outlined in your January 5 memorandum. On January 24, I received a reply from you answering the one general question, and stating that you were asking your staff to prepare answers to the detailed questions which I had submitted. Now, 4 months later, you hand-deliver to me your reply to the detailed questions. For the information of the committee, I will insert your replies in the record, both in the letter that you wrote of January 26, and the one delivered today dated May 11, which I am assured contains your answers to all of my questions. (The January 5 request of the chairman and the January 24 and May 11 replies of Secretary Ribicoff follow :) THE SECRETARY OF HEALTH, EDUCATION, AND WELFARE, MEMORANDUM FOR HON. HARRY F. BYRD Subject: Revisions in welfare legislation. From the time I became Secretary, I have been convinced that our welfare laws needed revision. When I testified before the Senate Finance Committee and the House Ways and Means Committee, I promised that I would undertake a careful review of Federal welfare laws and have a legislative program ready for 1962. I believe that this administration must assume leadership in this field and be out with a constructive program for others to follow. During this past year I have sought and received advice and reports from several groups of distinguished persons in the welfare field. What has emerged from this review is a clear recognition of the fact that today in 1962 the welfare program of 1935 is out of date. Born of depression, the original pioneering welfare legislation well met the problems of that time, but the quarter of a century that has passed has taught us many new things. We are not satisfied with our welfare programs and there is much that can and must be done to improve them. On the basis of the suggestions that have been made to me I have already announced 10 changes in our welfare programs that can be accomplished by administrative action. These administrative changes are designed to (1) promote rehabilitation services and develop a family-centered approach, (2) provide children with adequate protection, support, and a maximum opportunity to become responsible citizens, and (3) reshape the administrative structure of welfare so it may be more helpful in accomplishing these objectives and in dealing more constructively with such problems as locating deserting fathers and reducing fraud. These steps are the first part of a broad action program for revision of our welfare programs. In addition, legislative proposals will be necessary to carry this effort forward. Among the legislative proposals which we have considered are the following: 1. Provide for Federal financial participation in community work-training programs with adequate safeguards to protect the health and safety of the individual and to encourage the reemployment, retraining, and conservation of skills of employable persons on the aid-to-dependent-children program. In addition to the requirement that payments for such work must be at rates not less than those prevailing on similar work in the community, the work performed must be on projects which serve a useful community or public purpose and do not result in displacement of regular workers or in the performance of work that would otherwise be performed by other employees. In addition, provision must be made for issuing appropriate arrangements for the care and protection of the children during the absence from the home of any parent performing such work, as well as such other provisions that the Secretary advises necessary to assure that the program will operate with the best interests of the program and the individual in mind. 2. Provide for permitting the States to make protective payments to a very limited number of individuals where the individual is having difficulty in satisfactorily managing funds. Such protective payments could only be made to some individual who had a direct interest in the welfare of the recipient such as relative, neighbor, friend, or person in a private or public welfare agency. There would have to be adequate safeguards by the State agency with respect to such protective payments including periodic review to assure that they were not continued indefinitely and to provide the necessary services to enable individuals to develop a greater capability in managing their funds. Direct payments to landlords and grocers would not be permitted under this provision. 3. Authorize additional Federal funds to give the States an incentive to provide services to rehabilitate persons on welfare and to provide preventive services to those who might otherwise come on the welfare rolls. At the present time the Federal Government pays one-half of the cost of all administrative and service costs which the States incur. By separating out and identifying service costs and paying the States three-fourths of the cost of such services the States will have an incentive to provide more comprehensive services to rehabilitate persons on welfare. 4. Provide for increasing Federal funds for child welfare services including specific authorization for funds for day care of children of working mothers. In addition, the States would be required to extend their child welfare programs with a view of making available by 1975 child welfare services to all children in need of such services in the State. Federal funds for child welfare services would be increased progressively over a 10-year period. 5. Provide for extending on a permanent basis the provisions of the temporary law making available Federal funds for (a) children of unemployed fathers, (b) foster family care where the child has been removed from the home, and (c) increase of $1 in the Federal financial care of the aged, blind, and disabled. 6. Provide for the first time Federal financial participation in the assistance costs meeting the needs of both parents of the needy child. At the present time the Federal law only provides for Federal financial participation of meeting the needs of one parent. This would enable more adequate payments to be made under the aid-to-dependent-children program. 7. Provide that the existing authority for 100 percent Federal funds for the training of employees be directed to providing services to children in the aid-to-dependent-children program and the child welfare program. 8. Establish an optional new single category for the aged, blind, and disabled and for medical assistance for the aged which may be substituted by any State for the three present programs under the existing law. This would enable the States to simplify some of their procedures and bookkeeping and would also enable them to improve the adequacy of assistance of these three categories. 9. Provide for a number of other technical and administrative changes which are designed to emphasize rehabilitation and service to welfare recipients. |