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Recently, I received a letter from Dr. Vail, of Minnesota, dealing with the question of flexibility in the program and here is what he said:

I would bring you up to date on some of the problems we are having in implementing the Federal provisions at the state level, at least here in Minnesota.

The simplest way to do this, it seems to me, is to send you copies of the letters that I have written to Senator McCarthy and Representative Rogers, together with the stock answer received from the Department of Health, Education, and Welfare.

There is nothing to add to this point. I think our quarrel is not with the theory of the Federal concept of community mental health centers, but with the administratives practice, especially the requirement to prepare cumbersome plans for mental health centers in addition to the regular mental health plan which we write each year in order to qualify.

Generally, I would have to say that I favor the categorization of the welcoming of the correction of one comprehensive plan to the state of mental health programs that would require one plan for the entirety of the state mental health program.

I recall a meeting at the White House a couple of years ago in which it was the declared intention of HEW to move in the direction of giving the State more flexibility in the use of the funds. In some of these community health centers the facilities are there, and the staffing problem is more important than the bricks and mortar. In other cases the opposite is true.

I wonder if you wish to comment on this particular complaint?

Mr. COHEN. Yes. Let me make a brief statement and then I will ask Dr. Yolles to talk about it.

I also received a letter from Dr. Vail and I suppose I gave him what he refers to as a “stock answer.'

.” But I do wish to say that at the time I received his letter, I immediately communicated with Dr. Yolles, who is in charge of this program, to study the points that Dr. Vail made.

I established, at least to my own satisfaction, though perhaps not to Dr. Vail's, that we were trying to do two things that make it very difficult to carry out what Dr. Vail had proposed.

On the one hand, it is the professed objective both of the President and the Department, to give the States and the localities a greater degree of discretion in the use of Federal funds. But at the same time both the substantive committee (this committee)—and the Appropriations Committee hold us responsible for making an account of our stewardship in terms of what the money was appropriated for. Many of the so-called provisions and restrictions or requirements in the submittal of information, particularly those of which Dr. Vail has sometimes been critical are an attempt to be able to supply the substantive committee and the Appropriations Committee with all the information that they think is necessary to assure that Federal funds have been spent for the purpose for which they were appropriated. That requires us to collect a good deal of information to assure ourselves that the money has not been misspent, that is, misspent in the sense of not having been directed toward the primary purpose for which Congress appropriated the money.

I do think that there is a basis for giving the States more flexibility in programs once the program has been started. You will recall, for example, that we came in here 4 or 5 years ago requesting that the

States be given greater flexibility in the Hill-Burton program for modernization.

The committee very seriously restricted our ability to give the States that flexibility because they said, "We want to see this primary objective retained.”. I would say, Mr. Nelsen, that while the objective is sound, I think that also our administrators feel that we must be very carefully responsive to the congressional will. We want to be sure that we can account for the money in terms of the authorization that Congress has given us.

Perhaps Dr. Yolles would like to amplify on that in terms of Dr. Vail's points.

Dr. YOLLES. I would like to comment briefly, Mr. Nelsen.

I might say that I have commented on this point before regarding Dr. Vail. Dr. Vail's principal concern is with the “minutiae" as he calls them, of the State plan which must be submitted.

There are certain requirements in Public Law 88–164 which I consider to be very wise provisions of the Congress.

Before one sets up a program, especially in a field like mental health where there is such a tremendous need for services throughout the United States, the State must take into account which of its own areas have the greatest need. It needs to divide the State into areas which set forth the relative need for services.

It must also provide in the State plan an inventory of resources and services that presently exist so that these can be built into and not be duplicated by the new service to be rendered. It is this type of requirement which is in the law that Dr. Vail objects to.

Perhaps my last point is not entirely germane. However, it is that Dr. Vail has been the most outspoken objector to this requirement for providing such information and yet he was the first to submit a State plan in excellent form.

Mr. NELSEN. I appreciate the problem you face and might also mention that obviously, you are moving in the direction of attempting to provide for greater flexibility which I think is the direction in which all of us would like to move.

At the same time, I understand your concern. Getting to section 401(e) of the bill, this, of course, will also provide for the mental retardation centers; would it not?

Dr. YOLLES. Section 401(e) provides for altering the definition of the term of construction to allow for the acquisition of existing buildings.

Mr. NELSEN. Yes. Getting back to my problem of mental retardation day care centers and training centers, this has been an obvious area where attention is needed.

Out in my district we have under the poverty program one day care center and staffing is a tremendous problem. We have another one, using the little school building that I have talked about so many times, now under operation largely through voluntary subscription.

As far as acquisition of buildings is concerned, this seems to be the lesser of the problems. We find many hospital buildings that are vacated because they need new and larger facilities.

We find many school buildings vacated, very good centers with playgrounds and what-have-you. Looking to the future, is there a

possibility that we may be able to move not in the area of spending money on acquisition but more with the idea that we can give some help to staffing? Certainly there is a very, very crying need in many of our communities.

I believe other legislation may touch on that.

Dr. STEWART. Yes, Mr. Nelsen, there is legislation before the Congress for consideration of the staffing of the mental retardation centers, modeled very much like the initial staffing in the mental health centers.

In the amendment of section 401(e) by inserting the word “acquisition” after “new buildings,” it would apply to both the mental retardation and the mental health legislation.

Mr. NELSEN. Now, in your statement, on page 9, you say that H.R. 6431 “would continue the staffing grant program in its present form for an additional 4 years."

In this staffing grant program you presently have, would money be available to a day care center, a mental retardation day care center?

Dr. STEWART. No; this money is for the staffing of the comprehensive mental health centers. There is other legislation before the Congress which proposes the staffing of mental retardation centers.

Mr. NELSEN. Thank you.

And the money that was spent on the Tacoma and Minneapolis centers was not in bricks and mortar but more altogether in staffing, almost altogether in staffing?

Dr. YOLLES. A good part of it.
Mr. NELSEN. Thank you.
I have no more questions, Mr. Chairman.

Mr. JARMAN. The chairman of our full committee is with us this morning and I would like at this time to call on the chairman.

Mr. STAGGERS. Thank you, Mr. Chairman. I would like to ask Mr. Cohen just one or two questions because I don't want to take up the time of the committee.

What is the National Institute of Mental Health doing to improve the care available to patients in the existing State mental hospitals?

Dr. YOLLES. Mr. Staggers, as you may recall, at the time that the socalled new national mental health program was devised in 1963 as a complement to the Community Mental Health Centers Act, we made funds available for demonstrations of improved care and treatment of the mentally ill in hospitals.

This was a grant program available to all institutions for the mentally ill and mentally retarded in the United States. Each could apply on a competition basis for a grant of $100,000 each year for a period of 10 years to improve care and treatment.

These grants have resulted in some of the most interesting and constructive types of treatment programs and have aided in the release of many thousands of patients from mental hospitals. This is an interim program until the community mental health centers can take over the burden of the treatment of the mentally ill.

Mr. STAGGERS. Are there any of the States that do not have an approved plan for community health centers?

Dr. YOLLES. At the present time there is only one State that does not have an approved plan but we expect that before the fiscal year is out that that plan will have been approved.

We are in consultation with the State and they are making modifications of the plan which will make it approvable.

Mr. STAGGERS. You expect to have that one?
Dr. YOLLES. Yes, we do.
Mr. STAGGERS. That is all, Mr. Chairman. Thank you.
Mr. JARMAN. Dr. Carter.

Mr. CARTER. Certainly, I was impressed by the statement, Mr. Cohen, and also by the impressive charts. About the contingency fund, I would like to know if you have available statistics concerning deformities and still-born children resulting from German measles each year.

Do you have that at hand ?

Dr. STEWART. Mr. Carter, I don't have it at hand, but I can get this data for you if you wish it.

(The information requested follows:) It is conservatively estimated that the 1964–65 German measles epidemic re sulted in upwards of 30,000 abnormal pregnancies. In addition to thousands of fetal and newborn deaths, some 20,000 infants were born crippled with such defects as cataracts, deafness, mental retardation, and heart disease. Assuming that a vaccine had been ready for use or for testing in 1964, many of these deaths and abnormalities would have been prevented.

Mr. CARTER. I think that would be quite interesting since it is admitted that a delay of from 3 to 7 months takes place in securing an appropriation for vaccination in such cases and we could easily take that proportionate part of a year and estimate the number of deaths and deformities which would result from the lag in an appropriation which could be prevented by your contingency fund.

That is all I have to say.
Thank you very kindly.
Mr. JARMAN. Mr. Brown?

Mr. Brown. Mr. Cohen, I wonder if I could ask a couple of questions to verify some figures.

New members of the committee have to be educated in the use of figures which the rest of the committee may feel very familiar with but I personally am not. The $20 billion a year cost, would you work that up for me a bit ?

Mr. COHEN. Yes, the estimate of the $20 billion in the economic cost is composed of estimates giving the loss of output due to individuals who have to withdraw from the labor market, or from their other occupations, the loss of tax revenue that is involved in their not working, and in the additional cost for treatment and prevention.

As I said, the treatment and prevention cost is in the neighborhood of $4 billion a year at the present time. The estimated loss in tax revenues for people who can't work is about $312 billion. The remainder largely is due to the loss in the output because of inability to work or conduct their regular occupations.

Mr. BROWN. And this is based on how many mentally ill people?

Mr. COHEN. This is an annual cost based upon the estimated incidence of mental illness at the present time.

Mr. BROWN. Or those who are mentally ill and not hospitalized.

Mr. COHEN. Yes, including the hospital costs which, of course, are the largest costs. Of the $1 billion, about $21,2 billion is inpatient hospital care, and roughly about $1 billion is outpatient care.

Mr. Brown. If I understood the figures presented on the charts, there are 702,000 persons in mental hospitals at present.

Mr. Cohen. No: that would have been the number; 700,000 would have been the number if the projections from years prior to 1955 remained correct.

Mr. Brown. Would have been. Are you using those figures ?

Mr. Cohen. No; I am using the 1966 figures of the people who were actually, first, hospitalized; second, had å spell of mental illness that required outpatient care; and third, had to withdraw from the labor market because they had a period of mental illness.

Mr. BROWN. 452,000?

Mr. COHEN. Well, 452,000 is the total that were in a State or local mental hospital. That does not include the people who have outpatient care, or who were treated by the psychiatrist in his office.

Mr. Brown. May I have those figures?
Mr. Cohen. Would you like the detailed figures ?
Mr. Brown. I would like to get those.

Mr. Cohen. I will be glad to get that information for you and supply it for the record, yes.

Mr. Brown. I would appreciate that. (The information requested follows:) The number of patients resident in State and county mental hospitals at the end of December 1966 was 426,300.

The estimated number of patients receiving outpatient psychiatric services in 1966 was 1,885,000. This includes patients under care in outpatient psychiatric clinics as well as those receiving private psychiatric care.

Mr. BROWN. May I ask one other question in connection with the decline in these figures of people in mental hospitals. The problem of narcotics generally in the Nation has this had an appreciable effect on these figures, or do you estimate that it may have an appreciable effect, and is it included in these figures here?

Dr. YOLLES. A small percentage, Mr. Brown, of that number would be accounted for by narcotics addiction. By and large, addicts are not hospitalized in State or county hospitals. There are a total, it is estimated, of about 60,000 in the United States at the present time.

That is an estimate by the Federal Bureau of Narcotics.

Mr. Brown. Do you have any figures to pick out of this number, those whose mental incapacity may be the result of narcotics use?

Dr. YOLLES. It would be rather difficult to do, Mr. Brown. We can give you figures on narcotic addiction and losses due to narcotic addition but to relate that to an inhospital population would be rather difficult.

Mr. BROWN. In other words, I am trying to determine whether they have people in this figure who are in the hospital because of the use of narcotics or hallucinogenic drugs?

Dr. YOLLES. Relatively few.
Mr. Brown. You have no exact figure?
Dr. YOLLES. No exact figure.

Mr. CARTER. I notice that there has been a decrease in the number of inpatients of institutions from 702,000 to 452,000. That, of course, is due to more than one thing, is it not?

Dr. YOLLES. Yes, sir.

Mr. CARTER. New drug therapy for mentally ill patients as well as new methods of treatment and establishment of centers.

Thank you, sir.

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