The budget for 1968 represents funding proposals within the new organizational structure for the Public Health Service established by the Surgeon General at the direction of the Secretary of Health, Education and Welfare.

The reorganization of the Public Health Service, which became effective January 1, 1967, established five operating bureaus-Health Manpower, Disease Prevention and Environmental Control, Health Services, National Institutes of Health, and the National Institute of Mental Health. The National Library of Medicine and the National Center for Health Statistics will retain their former organizational position. Similarly, the Office of the Surgeon General is the directing, coordinating, and policy-making office of the Service.

Within the approximately 12 percent increase over current year funding, emphasis will be placed on the expansion of a number of high priority Public Health Service programs. A total of $140 million-the maximum amount authorized under existing legislation-will be devoted to implementing the Comprehensive Health Planning and Public Health Services Amendments of 1966, the so-called "Partnership for health". Building on the groundwork to be laid by a proposed 1967 supplemental appropriation of $4.5 million, these funds will be directed to the promotion of a close working relationship among Federal, State, local and voluntary health agencies to achieve comprehensive health planning and delivery of highest quality health services. Within this framework, the program will operate through a series of support mechanismsformula grants to States for comprehensive State-wide health planning; project grants to local or regional units for health and facility planning on a metropolitan area or regional basis; project grants for training, studies and demonstrations to foster more adequate health planning; broad formula grant support to State health agencies for the maintenance of adequate public health services; and target-oriented project grants for improving the provision of health services in selected disease and problem areas.

In the 90th Congress, legislation will also be proposed to provide for expansion of the program of formula and project grants for health services development. The additional $25 million to be requested for this purpose will be used by States and other public and non-profit agencies to mount programs in such areas as family planning, laboratory licensing, and the development of improved methods of delivering health services.

With the 1966 Amendments to the Clear Air Act as a take-off point, the attack on atmospheric pollution will be considerably expanded in fiscal 1968. Here again, the budget proposed funding the program at its maximum authorizationan increase of $26 million over the previous year's funding level. Under the recently enacted Amendments, authority was provided to extend grant assistance for the maintenance as well as the establishment and improvement of State and local air pollution control programs. A supplemental appropriation request of $4.9 million will begin this new phase of the grant program in 1967 and accelerate research efforts directed especially to the control of pollution from oxides of sulphur. These activities in addition to other research projects and an expanded pollution abatement effort will continue to be stressed in 1968. Funds are also included in the 1968 budget for the planning of a central air pollution research facility to bring together the major components of the new National Center for Air Pollution Control.

The training of additional health manpower is another area of emphasis in the 1968 budget. Grant support for the construction of teaching facilities for doctors, dentists and related professional personnel will increase by $40 million over the 1967 funding level. This action will provide some 538 additional places for the first year students in the health professions. A similar construction grant program aimed at the creation of training centers for medical technologists and other categories of allied health personnel will also be initiated. These increases in construction support will be accompanied by a major effort to improve the quality of education in new and existing facilities. Curriculum improvement grants to be used for such purposes as recruitment of additional faculty and a broader range of course offerings will more than double from $32.8 million in 1967 to $67.3 millions in 1968. Significant expansions will also occur in the student assistance programs, particularly for needy students. Health professions scholarships and nursing opportunity grants will aid approximately 12,000 students in 1968-almost a four-fold increase over the previous year. At the same time, operation of the recently authorized student loan revolving funds will permit a larger number of loans to be made to health professional and nursing students despite a reduction in the level of new obligational authority for this program.

In the field of health services, expanded efforts will be aimed at providing improve health services to people in rural areas, domestic migratory workers and their families, and Indians, Alaska Natives, and other direct beneficiaries of the Public Health Service. Research and development programs to improve the organization, delivery and financing of comprehensive health services will be increased. Construction and modernization of hospitals, long-term care facilities, public health centers and similar projects under the Hill-Burton program will again be supported at the full legislative authorization. Legislation will also be sought to extend the Appalachian Regional Development Act, including its provision for the construction and operation of multicounty demonstration health facilities. $15 million is included for this purpose in the 1968 budget request.

Building on past progress, support for biomedical research will continue to grow in 1968. Excluding construction grant programs, an increase of $96.7 million will be requested for activities of the National Institutes of Health. Research grant programs will receive the largest segment of this increase-about $53.3 million. These funds will be used to continue previously awarded projects, provide for the support of new research projects in high priority areas, and expand institutional and resource support programs. Although only $16.7 million in new grant funds will be requested in 1968 for the planning and operation of regional medical programs, this amount will be combined with a carryover of $21 million in 1967 funds. Together, these resources will be largely used to finance the operational aspects of regional programs to combat heart disease, cancer, stroke and related diseases. NIH's targeted research and development projects will also receive considerable emphasis in 1968. Work on the development of a simpler, more efficient and more economical artificial kidney; vaccines to combat major respiratory diseases caused by viruses; mechanical circulatory assist devices to help people suffering from failing hearts; and studies in virus leukemia are some of the research programs to be pursued. In the construction area, the program level of funds available for health research facilities construction will increase by $9 million over 1967 due to a combination of new funds to be requested in 1968 and money brought forward from the current fiscal year.

In the mental health area, $346.9 million will be requested for programs of the National Institute of Mental Health-an increase of $39.2 million over 1967. In addition to strengthened research programs-both extramural and intramural-emphasis will be placed on continued implementation of the community mental health concept. Legislation will be sought to extend the grant program for construction of community mental health centers, and $50 million will be requested to fund this program in 1968. As more and more centers become operative and existing centers provide additional mental health services, more than $46 million will be requested in 1968 to finance 121 mental health staffing grants. To provide the personnel for these and future community facilities, $88.6 million will be requested for mental health service training programs. Beginning in fiscal year 1967, support will also be proposed for implementation of

the Narcotic Addicts Rehabilitation Act of 1966. Initially these funds will support "tooling-up" activities. In 1968, however, $4 million will be requested to assist States, local governments, and public and private organizations to increase their efforts to deal with the problem of narcotic addiction.

Other Public Health Service programs such as the National Library of Medicine will also continue to expand in 1968. In particular, additional resources will be requested to assist the Surgeon General in implementing the large number of new health programs enacted by the Congress in recent years.

The CHAIRMAN. Mr. Surgeon General, I want to thank you for a very impressive presentation, very fine and well done, and certainly well prepared. It has to do with something that affects every

American.

You have an impressive aray of help here right now.

Mr. Rogers, do you have any questions?

Mr. ROGERS. Thank you, Mr. Chairman.

Mr. Surgeon General, it is a pleasure to see you and your associates here.

I want to commend you for the job you have been doing with your associates here. I think basically it is good and it is going to develop a pogram of better health for the American people.

I think, too, you probably lead the way in a trend which I hope will develop in other areas, and that is I think it was the Public Health Service that came into the committee recommending that instead of giving categorical grants to State health agencies now you are going to try to give a greater decisionmaking authority to the States, themselves, by giving a lump-sum grant which they may place where they feel it is necessary within the State.

I would like for you to comment on that and let us know what reaction we are getting and about where that program is now. Dr. STEWART. You are quite correct, Mr. Rogers.

Two or three years ago when the categorical grant program was expiring, we were looking at it with the States and they were unveiling all the difficulties they were having with the rigid categorization we had in the former grants and project grants.

We had some nine categorical grants which were labeled "they must be spent for this particular category," and while these were all very important needs in the country there was no way in which the State could mold this effort to meet the needs in their States which may vary from place to place or fitted into the resources they had which vary from place to place.

We have with Public Law 749 of last year pooled this money, the formula money and project money, so the State may have the flexibility to try to fit these efforts into their needs and their resources. This comes into effect in fiscal year 1968. We are still operating under the other authority.

Mr. ROGERS. Have any plans come in yet, or when do you anticipate the States would put in their plans?

Dr. STEWART. No, sir. We are in the process of developing regulations. We are having a great many meetings with the State health officers, getting organized, to implement the starting in 1968.

Mr. ROGERS. I have had some concern expressed about community mental health centers where we have issued certain requirements. Then they change the requirements. It was stated to me they felt

that if we could call in State health people, discuss this, what their problems would be, before setting the rules, it might be helpful in working out some of these problems. What would be your feeling

about that?

Dr. STEWART. Mr. Rogers, I am aware of some of the complaints, I guess you would call them, that have occurred.

Mr. ROGERS. Well, this is natural in any program.

Dr. STEWART. We believe we have worked with them very closely and whenever there has been misunderstanding or controversy we have met with groups to try to work it out.

Mr. ROGERS. What I was going to say was if there could be some set program of meeting with them-or maybe you have; I don't know— before certain regulations are issued to let them have a discussion and comment on them before, would this not be helpful?

Dr. STEWART. Yes.

Mr. ROGERS. They are going to have to administer these programs. I think it would move it along more rapidly.

Dr. STEWART. The Surgeon General meets annually with the mental health authorities and the State health authorities and these regulations were discussed at these meetings.

Mr. ROGERS. I think the regulations were drawn and then changed again, weren't they? Have there not been changes?

Dr. STEWART. I have to call on Mr. Yolles to get the whole story. Mr. ROGERS. This was my impression.

Dr. YOLLES. There are two sets of circumstances. The Mental Health Center Construction Act passed 2 years before the legislation for staffing. We did consult with representatives of the mental health authorities at the time of the drawing up of the regulations. Subsequently, they requested additional representatives of their organizations be involved. Because the State authorities felt that they needed more representation when we drew up the regulations for staffing, in 1965, some 2 years later, there was even more representation and, as a matter of fact, a preliminary draft was circulated for their comment and criticism. The matter of representation has been a source of continuing discussion with the State authorities and at the present time we have proposed an on-going discussion group which will meet at regular intervals, at least three times a year, to discuss proposed regulations.

Mr. ROGERS. I think that will be helpful. I am glad to know that. I want to commend you, too, in setting up this Bureau of Health Manpower. I think this is very essential and I think we are going to see great results come from this.

I notice in the President's message that you are contemplating setting up, if the Congress approves, this Bureau of Research for delivering services because from the National Institutes of Health where Dr. Shannon has done such an outstanding job and where we can get the knowledge of treatment in many areas, we have not been getting it out. Or it seems at least this was our study.

Many of the latest treatments have not filtered down as they should and it is my understanding now that you contemplate meeting this problem by doing research on delivery which I think is very significant and, of course, ties in with manpower as well.

Dr. STEWART. This is correct.

Mr. ROGERS. Also on the environmental control, I see in the setup of the new Bureau environmental control is given a very prominent part and is part of the title of the Bureau so that we are not by any means downgrading our concern for environmental problems, are we? Dr. STEWART. Absolutely not. We are trying to make it as prominent as possible. I also hope that we are conveying the theme that much of disease prevention and disease control is through environmental control so that you have the balance between them; they are really parts of a whole.

Mr. ROGERS. Now, let me ask you: Is there any one bureau that a State or community can come to and find out where all the grants are? Dr. STEWART. For information about all the grants under Public Law 749, for example, which will be the ones the States will be most involved in, they will go to the regional offices.

Mr. ROGERS. They will go where now?

Dr. STEWART. To the regional offices of the Department.
Mr. ROGERS. Yes.

Dr. STEWART. That will be the central place to go.

In the community mental health centers and community retardation centers programs, the regional offices are also the main source. The Hill-Burton program acts in the regional office. If a State, and there are a few, is applying for research grants or research training grants, they would not go to the regional offices; they would go to the National Institutes of Health.

By the way, we are organizing our administration of Public Law 89-749 so that instead of having some 50 or 20 different places where one applied for a grant to do a study in cancer or heart in the community, they will go to one place.

Mr. ROGERS. This is what I want to know. I think this ought to be stressed because it has been very confusing for States and communities, I think, and we have discussed this quite at length, to have to go to so many areas of operation to try to find out even whether to put in an application. So, do they go to the regional office or elsewhere?

Dr. STEWART. Well, if it is a community grant program, construction, or study of a program to do something about tuberculosis, for example, the regional office is the place to go.

There are a few State health departments and local health departments conducting research very much like that in a university laboratory. They still seek grants from the National Institutes of Health. All requests go to one place.

Mr. ROGERS. So, it would be the two areas, then, either the National Institutes of Health or to the regional office.

Dr. STEWART. Yes.

Now, there are some areas where we haven't solved this difficulty yet. I don't want to imply that everything has been changed but we have made great progress, I think, in cutting down the number of places that one applies for grants.

Mr. ROGERS. Do they have to have State approval in most of these before they

Dr. STEWART. If it is a grant under Public Law 149, with the exception of one part of the project grants, part III, they all must be in conformance with the State plan.