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also helps through its legislative reference process in the development and coordination of his legislative program.

Through the budget process, the Bureau of the Budget plays a sig. nificant role in the allocation of resources and the determination of priorities among competing demands.

Budgeting is essentially an orderly way of making choices. The shaping of the President's budget and of the fiscal and economic policies which underlie it involve extensive consultation for many months among the executive agencies.

In the last few years we have endeavored to improve the effectiveness of the Federal budget process as an instrument of long-range planning and programing. The actual weighing of agency budget requests is accomplished through procedures encompassing long-range plans and budget projections prepared well in advance of the development of detailed agency proposals, full-dress agency budget submissions, hearings, and Presidential determinations on agency budgets.

In this process agency proposals for health programs are considered in relation to each other and to the funds requested for other activities of the Government. This budget review also encompasses the fiscal impact of proposals in the President's legislative program.

The Office of Science and Technology is another significant instrument in the coordination of health research programs. Dr. Wiesner will, of course, discuss its work in his presentation.

Finally, it should be noted that in recent months the President has appointed a Special Assistant for Mental Retardation who is concerned at the Executive Office level with health activities insofar as they affect that field.

It is evident from the data which I have presented that the health activities of the Federal Government are in a phase of rapid development. Many new programs have been enacted in recent years.

A number of extremely significant legislative proposals in the health field are now before the Congress, including several important ones assigned your committee.

One of the most significant changing areas in the health field is in the area of science. As Federal funds for medical research have been multiplied, it is only natural that we should be concerned as to whether the capacity to do high-quality research is keeping pace and whether this investment in research will continue to yield high results.

The question of priorities in research, and as between research and other programs, is one of the most troublesome problems in the Federal budget.

Because of the very nature of research and because of the difficulty in either predicting or measuring returns from research, budgeting for these activities is extremely difficult and must rely in considerable part on the judgment of the executive and the legislative branches as to the possible long-term gains to be achieved.

Other difficult scientific problems also face us in the health area. A stronger scientific base for the food and drug regulatory and the environmental health activities of the Government is indicated by the increasing recognition of problems in the drug, food additives, radiological health, air pollution, and pesticides areas, to name a few topics of current concern.

Another concern relates to the development of more effective techniques for communicating the vast output of new knowledge, both within the research community and from the scientific community to medical practice.

How large is the existing gap between new information which is already available from medical science and its application in the current practice of medicine as it is carried out by the thousands of doctors in our country?

The rapidly increasing costs of hospital and medical care, and of drugs, also pose major problems of medical costs and economics, which underlie

the urgency of Federal financial assistance for medical care. In addition, rapid growth in our population and the increasing proportion of aged citizens make their effect felt, for example, in the existing shortages of nursing homes.

The rapid growth of Federal funds for medical research has produced a close relationship between the Federal Government and the universities. As this process goes on, there arise many crucial questions of Federal Government-university relations, all centering around the key question of whether the Federal Government and the universities can exercise adequate stewardship of the funds which are provided in a manner which will maintain the academic freedom of the university community.

We need to reassess the whole process in the Government for awarding and for administering research grants and to develop appropriate criteria and principles of Government-wide application.

Another problem is that of overcoming the great shortages of skilled personnel in the health specialties. Training programs must obviously be related to manpower needs and this in turn gives rise to many basic questions, such as whether categorical approaches or more general approaches should be utilized to stimulate and support the training of necessary skilled personnel.

It is necessary in these circumstances to develop now organizational arrangements to meet emerging needs. At the Executive Office level and at the interagency level, the establishment of the Office of Science and Technology and the Strengthening of the Federal Radiation council in recent months represent real progress.

Likewise, the enactment of Public Law 87–838, which permitted the establishment at the National Institutes of Health of the new Institute of Child Health and Human Development and the Institute of General Medical Sciences, represented a significant step.

Clearly, in this rapidly changing area we need the flexibility to organize properly so the agencies can meet new problems as they arise without the restriction of previous patterns of organization which are no longer suitable in the light of new knowledge and new requirements.

The provision of authority included in H.R. 2410 to permit the Surgeon General to reorganize the Public Health Service in keeping

with the emerging requirements to emphasize both environmental health and community health activities would be an important step.

It would recognize the increasing importance of these areas and would thus assist in attracting outstanding scientific and administrative talent into the Public Health Service.

Improved organization is necessary if the Nation is to meet successfully the health challenges of a growing America.

Mr. Staats. Mr. Chairman, we have attached to this statement, which I will not read, a statement called the "Special Analysis of Federal Medical and Health-Related Programs,” which is a tabulation of funds for fiscal years 1962, 1963, and 1964 and a description of the programs administered by the principal agencies which I have briefly touched upon here in this statement this morning.

Mr. ROBERTS. Without objection, you may include that in the record.




(Tabulations of funds for the fiscal years 1962, 1963, and 1964 and descriptions

of programs administered by the principal agencies with medical or healthrelated activities)

FOREWORD In order to present an overview of the many medical and health-related activities carred on by the Federal Government, there follow three tables which summarize Federal obligations for these programs. There also is attached a summary statement describing the health activities, including their costs for the fiscal years 1962, 1963, and 1964, for each of the seven departments and seven agencies having major responsibility for Federal health activities. These tables and statements are intended to provide a general description of agency activities in the health area and are not intended as definitive statements of program mission and goals.

The following agencies are covered in the tables and the descriptive statements : Department of Agriculture

Department of Justice Atomic Energy Commission

Department of Labor Civil Service Commission

National Aeronautics and Department of Defense

Space Administration Department of Health,

National Science Foundation Education, and Welfare

Small Business Administration Housing and Home Finance Agency Department of State Department of the Interior

Veterans Administration For a more extensive analysis of these activities as they existed several years ago, attention is called to Senate Report 142 of the 87th Congress, 1st session. This earlier report was prepared by the Subcommittee on Reorganization and International Organization of the Senate Committee on Government Operations. TABLE A.--Federal obligations for medical and health-related activities by agency

(Fiscal years-In millions of dollars)

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NOTE.-Detail may not add to totals due to rounding.
Source: The

of the U.S. Government, fiscal year ending June 1964, as modified by sul ent supplementaland legislative recommendations. TABLE B.-Federal obligations for medical and health-related activities by

(Fiscal years—In millions of dollars)

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6, 228


2, 102

2, 811



3, 417

3, 289

NOTE.-Detail may not add to total due to rounding.

Source: The budget of the U.S. Government, fiscal year ending June 30, 1964, as modified by subsequent supplemental and legislative recommendations.


TABLE C.-Federal obligations for medical and health-related activities by agency and category

(Fiscal year 1964-In millions of dollars)

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Nore.-Detail may not add to total due to rounding,

Source: The budget of the U.S. Government, fiscal your ending June 30, 1964, as amended by subsequent supplemental and logislativo recommendations.

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