[Senate Hearing 105-872]
[From the U.S. Government Publishing Office]


                                                S. Hrg. 105-872, Pt. 1
 
  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1999

=======================================================================

                                HEARINGS

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                       ONE HUNDRED FIFTH CONGRESS

                             SECOND SESSION

                                   on

                           H.R. 4274/S. 2440

 AN ACT MAKING APPROPRIATIONS FOR THE DEPARTMENTS OF LABOR, HEALTH AND 
  HUMAN SERVICES, AND EDUCATION, AND RELATED AGENCIES, FOR THE FISCAL 
         YEAR ENDING SEPTEMBER 30, 1999, AND FOR OTHER PURPOSES

                               __________

                          Part 1 (Pages 1-572)

                   Corporation for Public Broadcasting
                        Department of Education
                Department of Health and Human Services
                          Department of Labor
              Federal Mediation and Conciliation Service
                       Nondepartmental witnesses
                 Physician Payment Review Commission
              Prospective Payment Assessment Commission
                   United States Institute of Peace
                      Nondepartmental witnesses
                    Social Security Administration

                               __________

         Printed for the use of the Committee on Appropriations


       Available via the World Wide Web: http://www.access.gpo.gov/
                            congress/senate

                                 ______

                     U.S. GOVERNMENT PRINTING OFFICE
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                      COMMITTEE ON APPROPRIATIONS

                     TED STEVENS, Alaska, Chairman
THAD COCHRAN, Mississippi            ROBERT C. BYRD, West Virginia
ARLEN SPECTER, Pennsylvania          DANIEL K. INOUYE, Hawaii
PETE V. DOMENICI, New Mexico         ERNEST F. HOLLINGS, South Carolina
CHRISTOPHER S. BOND, Missouri        PATRICK J. LEAHY, Vermont
SLADE GORTON, Washington             DALE BUMPERS, Arkansas
MITCH McCONNELL, Kentucky            FRANK R. LAUTENBERG, New Jersey
CONRAD BURNS, Montana                TOM HARKIN, Iowa
RICHARD C. SHELBY, Alabama           BARBARA A. MIKULSKI, Maryland
JUDD GREGG, New Hampshire            HARRY REID, Nevada
ROBERT F. BENNETT, Utah              HERB KOHL, Wisconsin
BEN NIGHTHORSE CAMPBELL, Colorado    PATTY MURRAY, Washington
LARRY CRAIG, Idaho                   BYRON DORGAN, North Dakota
LAUCH FAIRCLOTH, North Carolina      BARBARA BOXER, California
KAY BAILEY HUTCHISON, Texas
                   Steven J. Cortese, Staff Director
                 Lisa Sutherland, Deputy Staff Director
               James H. English, Minority Staff Director
                                 ------                                

 Subcommittee on Departments of Labor, Health and Human Services, and 
                    Education, and Related Agencies

                 ARLEN SPECTER, Pennsylvania, Chairman
THAD COCHRAN, Mississippi            TOM HARKIN, Iowa
SLADE GORTON, Washington             ERNEST F. HOLLINGS, South Carolina
CHRISTOPHER S. BOND, Missouri        DANIEL K. INOUYE, Hawaii
JUDD GREGG, New Hampshire            DALE BUMPERS, Arkansas
LAUCH FAIRCLOTH, North Carolina      HARRY REID, Nevada
LARRY E. CRAIG, Idaho                HERB KOHL, Wisconsin
KAY BAILEY HUTCHISON, Texas          PATTY MURRAY, Washington
TED STEVENS, Alaska                  ROBERT C. BYRD, West Virginia
  (Ex officio)                         (Ex officio)
                      Majority Professional Staff
                            Bettilou Taylor
                             Mary Dietrich

                      Minority Professional Staff
                              Marsha Simon

                         Administrative Support
                   Jim Sourwine and Jennifer Stiefel


                            C O N T E N T S

                              ----------                              

                        Thursday, March 5, 1998

                                                                   Page
Department of Education: Office of the Secretary.................     1

                        Tuesday, March 10, 1998

Department of Health and Human Services:
    Office of the Secretary......................................    59
    Health Care Financing Administration.........................    59

                       Wednesday, March 18, 1998

Department of Labor: Office of the Secretary.....................   125

                        Wednesday, April 1, 1998

Department of Health and Human Services: National Institutes of 
  Health.........................................................   191
Nondepartmental witnesses..................................331
Material submitted subsequent to conclusion of the hearing.......   275

        Material Submitted Subsequent to Conclusion of Hearings

Prospective Payment Assessment Commission........................   291
Physician Payment Review Commission..............................   294
United States Institute of Peace.................................   300
Corporation for Public Broadcasting..............................   312
Federal Mediation and Conciliation Service.......................   323
Nondepartmental witnesses......................................333 deg.
  


  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1999

                              ----------                              


                        THURSDAY, MARCH 5, 1998

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Arlen Specter (chairman) 
presiding.
    Present: Senators Specter, Cochran, Gorton, Faircloth, 
Harkin, Hollings, Bumpers, and Kohl.
    Also present: Senators Stevens and Byrd.

                        DEPARTMENT OF EDUCATION

                  Office of the Secretary of Education

STATEMENT OF HON. RICHARD W. RILEY, SECRETARY OF 
            EDUCATION
ACCOMPANIED BY THOMAS P. SKELLY, DIRECTOR, BUDGET SERVICE

                opening remarks of senator arlen specter

    Senator Specter. Good afternoon, ladies and gentlemen. The 
hour of 2 o'clock has arrived which is the starting time for 
our proceedings.
    Would the distinguished Senator from South Carolina like to 
make a comment about our distinguished witness?


             opening remarks of senator ernest f. hollings


    Senator Hollings. And that witness is distinguished. I 
think the whole country is very proud of Secretary Riley's 
leadership and his contribution to education. I just wanted to 
amen the sentiments here. At this particular time, Mr. 
Chairman, our full committee, unfortunately, has got a regular 
hearing now, but I wanted to welcome him to the committee.
    I think the President's initiatives are well-founded, and 
the question is where do we get the money. That is what we have 
got to do. I am going this afternoon to the Budget Committee.
    For the information of everyone, we will be marking up on 
next Thursday, just 1 week from today, in the Commerce 
Committee to back a settlement bill, hopefully. I hope it is a 
comprehensive package approach because otherwise if they just 
break down into different parts and leave out this or put in 
some other thing objectionable, then we are not going to get 
anywhere. But the idea with Chairman McCain is that we get 
together and report out a package bill of some kind so that the 
Congress will then be prepared to work because we at the Budget 
Committee know the moneys for, let us say, Social Security, 
Medicare, and otherwise----
    Senator Specter. Are you still introducing the witness, 
Senator Hollings? [Laughter.]
    Senator Hollings. Let me yield to the chairman. Thank you 
very much.
    Senator Specter. We have a crowded agenda today. We have 
not only the Secretary, but we also are having a hearing on 
campus crime. The Governmental Affairs Committee has scheduled 
a meeting at 4 o'clock this afternoon, which was scheduled 
after this hearing was scheduled. We expect the meeting to be 
not as bipartisan as this subcommittee hearing will be. So, it 
is our hope to conclude our proceedings by 4 o'clock.
    We are pleased to welcome Secretary Riley here this 
afternoon.

                           prepared statement

    The Department of Education's budget request for 
discretionary spending for fiscal year 1999 totals $31.2 
billion, an increase of $1.7 billion, or almost a 6-percent 
increase over fiscal year 1998. We congratulate the Secretary 
and we congratulate the President for emphasizing education in 
addition to the increase which occurred last year.
    Without objection, my full statement will be made a part of 
the record.
    [The statement follows:]
              Prepared Statement of Senator Arlen Specter
    This afternoon, the Subcommittee on Labor, Health and Human 
Services and Education will begin its series of hearings on the 
President's fiscal year 1999 appropriations requests.
    We are pleased to once again welcome Secretary Richard Riley to the 
subcommittee to discuss the budget for the Department of Education for 
the upcoming fiscal year.
    The Department of Education's budget request for discretionary 
spending for fiscal year 1999 totals $31.2 billion, an increase of $1.7 
billion or 5.9 percent over the fiscal year 1998 amount.
    You can see from the chart to my right the difficulty facing this 
subcommittee by the President's assumption that savings will be 
realized through enactment of user fees or new taxes.
    In fiscal year 1997, discretionary spending for this subcommittee 
totaled $74.7 billion.
    In fiscal year 1998, discretionary spending increased to a total of 
$80.4 billion.
    For fiscal year 1999, the President has requested $84.5 billion, 
but $1.9 billion of this amount would be financed by new user fees and 
assumed receipts from tobacco legislation.
    Mr. Secretary, the administration's budget request has put us in a 
real spot, basically $1.9 billion in the hole, and I fully expect that 
you will work closely with this committee as we try to resolve this 
dilemma.
    Mr. Secretary, of all of the funds contained within this 
subcommittee's jurisdiction, by far the most, direct, rewarding, and 
important investment we can make is in the education of this Nation's 
youth.
    Today we are also pleased to have a second panel of distinguished 
witnesses who will testify following Secretary Riley. These witnesses 
will discuss the issues surrounding security on our college campuses.
    Mr. Secretary, we will be pleased to hear your testimony at this 
time.

                 introduction of senator robert c. byrd

    Senator Specter. We are graced today by having the 
distinguished Senator from West Virginia, former President pro 
tempore, chairman of the Appropriations Committee, and just 
about every other title you can find. I would make one comment. 
Senator Dodd was at the funeral eulogizing Senator Ribicoff and 
said that Senator Ribicoff had to speak very briefly because 
his introduction was so long because he had held so many 
positions. Well, that is like Senator Byrd.
    The floor is yours, Mr. Chairman.

               opening remarks of senator robert c. byrd

    Senator Byrd. Thank you, Mr. Chairman. I am very flattered 
by your making this opportunity available to me. I am not on 
the subcommittee, but I am very interested in the work of this 
subcommittee. I will be very brief because I am somewhat of an 
intruder here, but I am extremely interested in the education 
of our people.
    Mr. Chairman, members of the subcommittee, I thank you for 
holding this hearing on the Department of Education budget for 
fiscal year 1999. I extend my appreciation to you, Mr. 
Chairman, and to Mr. Harkin, for all of your hard work and 
commitment in the area of education.
    Mr. Secretary, I welcome you today. I realize that my time 
is limited, so I am going to have to be direct and succinct in 
my remarks.
    I am very concerned with the declining state of the 
American education system and our Nation's lack of progress in 
the area of education. As I said last year in this 
subcommittee, the Federal Government continues to pour massive 
amounts of money into education, and I have voted for every 
appropriation for education since the Senate and House embarked 
on Federal aid to education. I have never voted against one of 
those bills. I just am sorry to see zero improvement.

           Third international mathematics and science study

    Why is it that from 1993 to 1998, education spending has 
increased by 25 percent and at the same time results from the 
third international mathematics and science study [TIMSS] 
ranked the U.S. high school seniors among the worst 
participants in the areas of math and science? Why is it that 
in all three content areas of advanced mathematics, U.S. 
advanced mathematics students' performance was among the lowest 
of the 21 participating nations? These are supposed to be our 
Nation's stellar students.

                   Robert C. Byrd honors scholarships

    I am 100 percent for education, Mr. Secretary. I do not 
want to vote against increased spending for education. It gives 
me great pleasure to see well-deserving students--and there are 
many of them who are committed to their studies, and I am glad 
to see them attend college. That is precisely the reason that I 
began the Robert C. Byrd honors scholarship so many years ago, 
to provide the opportunity for an advanced education for those 
individuals who realize the meaning and the importance of a 
good education, not just for the time being, but forever.

                          Parental involvement

    If we ever hope to improve the quality of students being 
produced in this country, it is essential that we recultivate 
an interest in education for education's sake, not only in our 
Nation's children, but also in their parents. Our Nation's 
ailing education system is, in part, influenced by the parents 
of those children and young adults attending high school and 
college. Parents are role models, or should be, and children 
are likely to emulate them in a multitude of ways. Those 
parents who partake in intellectually stimulating activities 
and encourage their children to do likewise are slowly becoming 
extinct.
    What is much more usual is the example of the couch potato 
type of existence involving half-awake adults sipping a 
Budweiser and staring at mind-numbing--mind-numbing--violent or 
offensive TV programs. This lifestyle has been glorified and 
replicated in the deplorable, mindless TV sitcoms which crowd 
network TV and which are watched all too much by our young 
people. It is like a vicious circle, an example of life 
imitating popular entertainment, if such junk can be called 
entertainment, and vice versa.
    I just do not believe that merely proliferating education 
programs will solve the problems of improving our Nation's 
quality of students. On a fundamental level, there is something 
askew with the way we are approaching education in this Nation. 
I started out in a two-room schoolhouse where we did not have 
high technology. We did not have computers. We did not know 
anything about them. We did not have much money for supplies, 
but what we did have were dedicated teachers who really cared 
about the future of education and, therefore, exerted 
discipline to keep the focus of the schoolroom strictly on 
learning.
    My old coal miner dad told me that if I got a whipping at 
school, I could expect to get another one at home. He meant it 
and I knew he meant it. We had on that grade card a little item 
called deportment, and I was always very careful to get a good 
grade in deportment.
    We also had parents, as I say, who would back up the 
teachers. They did not say, ``I will go up and whip the 
teachers.'' They said, ``I will whip you.'' Today, this has all 
but disappeared, I am afraid. We have undisciplined students 
intimidating teachers and impeding the learning of their 
classmates. We did not have that in my day in school back in 
West Virginia. We have teachers who are more concerned with 
lawsuits today--and can you blame them--should they try even 
feebly to exert authority than in trying their best to impart 
useful knowledge.

                             TIMSS results

    Mr. Secretary, no longer can we afford to fabricate excuses 
for why our students are not doing well. While it is true that 
the third international mathematics and science study is a 
rigorous test, posing difficult questions to students, other 
countries appear to be mastering these very same skills and 
concepts. Rather, we must look for solutions.
    According to the study, our high school students devote a 
significantly smaller portion of time to their studies and are 
less likely to take 4 years of math and science instruction. 
Now, why is that? Why are they permitted to opt out of these 
two critical disciplines? Obviously, getting back to the basics 
is where we need to focus.
    I am not here today to prescribe the solution for our 
Nation's lack of progress in the area of education. I wish it 
were that simple, and I could with the snap of my fingers 
change the results of the third international mathematics and 
science study and rank U.S. seniors as No. 1 in the world.

                          Parental involvement

    But I think we concentrate too much on what is the best 
team in the league, though no ball game ever changed the course 
of history. I like to watch games. I get all tensed up sitting 
on the edge of my chair, too, but when it is all over and I 
have watched that football game, I can say truthfully that when 
you have seen one game, you have seen them all. They are all 
alike. They never change, and no ball game is ever going to 
change the course of history. Ball games did not put man on the 
Moon. It takes the brain of the person who has a mind and 
heart, the dedication to study, and who is willing to work, and 
to exercise that drive and ambition, to get somewhere. And good 
teachers can go a long way in encouraging that and so can good 
parents.
    I think that all of my colleagues here would agree that 
``U.S. Seniors Rank Among the Best and the Brightest'' would be 
a thrilling headline to have emblazoned on the front page of 
the New York Times or the Washington Post or the Washington 
Times or my hometown newspaper. But the question is: Why are we 
not the best?
    I suspect that part of the reason is because we have taken 
the focus off teaching the basics and using discipline to make 
sure order is maintained in the classroom and instead stressed 
pleasing everyone--parents, lobby groups, and students--with 
curriculums, dumb-downed textbooks, and teaching methods. We 
are subjugating time-honored techniques for grounding students 
with basic educational skills in history and geography, for 
example, to other laudable concepts and interests such as 
social sciences, which are good, but when students do not know 
when the Civil War occurred or in what century it occurred, and 
can only remember Abraham Lincoln because he got shot, 
something is wrong.
    I view such a juxtaposition as a grand mistake and I think 
test results continually prove me correct, unfortunately.
    I thank the chairman for giving me this opportunity to 
speak before the subcommittee.
    I have some questions, Mr. Chairman, that I would like to 
submit for the record. I will not impose on the time of the 
subcommittee, whose members have been so generous already with 
me. I would like to include them in the record, but I would 
like if I might ask if Secretary Riley would like to respond to 
my statement.
    Senator Specter. Well, Mr. Secretary, let me first call on 
Senator Cochran for an opening comment, and then we will call 
on you. Your response to Senator Byrd's statement may well 
constitute your testimony. [Laughter.]
    I would make just one comment on my father's agreement with 
Senator Byrd about football. My father watched a brief part of 
a football game once and a fumble occurred, one of those plays 
where 16 different people touched the ball and finally someone 
fell on it. And my father looked at it and said, why do they 
not give all those men another football? [Laughter.]
    Senator Bumpers. Mr. Chairman, may I just make one remark 
on Senator Byrd's statement about getting a whipping, if he got 
a whipping at school, he got one at home that night. There is a 
story up in the Ozarks about a kid who got a whipping every 
day. He got in trouble, and every night when he got home, he 
got another one. He got tired of that, and one day he made a 
commitment that he was going to do absolutely nothing to get a 
whipping at school for. And he had made it just fine, and about 
10 minutes before the bell rang, the teacher was walking up and 
down the aisle. And he stopped by this kid's desk, and he said, 
Johnny, who wrote the Declaration of Independence? And he was 
intent on not getting in trouble. He says, I don't know. I know 
I didn't do it. [Laughter.]
    When he got home that night, his father said, well, did you 
get a whipping in school today and he said, yes, I did, but he 
said, it wasn't my fault this time, Dad. He says, that's what 
you always say. What happened?
    So, he told him. He said the teacher asked me if I wrote 
the Declaration of Independence, and I told him, no, I didn't 
do it. He asked, if I knew who did it, and I said, no, I don't 
know. I know I didn't do it. His old man said, well, if you 
didn't do it, you probably had it done, and proceeded to give 
him another one. [Laughter.]
    Senator Specter. There will not be time for your testimony. 
[Laughter.]
    We thank Senator Bumpers for his opening statement. 
[Laughter.]
    Senator Cochran.

                opening remarks of senator THAD COCHRAN

    Senator Cochran. Thank you, Mr. Chairman.

                        NIH research on Reading

    Mr. Chairman, I wanted to bring to the attention of the 
Secretary the fact that we are making progress on an initiative 
that we discussed at last year's hearing, and that was the 
convening of a reading panel to try to analyze research that 
had been done at NIH in NICHD, the National Institute of Child 
Health and Development, affecting the ability of children to 
learn to read or not learn to read at early ages. I am glad to 
see that the progress we have made has now resulted in the 
selection of some of these panel members and the work of the 
panel will begin soon.

                        America Reads Challenge

    I bring it up in this context: the budget proposal by the 
administration suggests that the President's reading program 
and a House-passed bill may form the basis of the Department's 
initiative on this subject, and substantial funds--I think 
about $200 million--are requested or predicted to be spent in 
support of this.

          House directive on convening Reading research panel

    I wonder whether or not you can react for the record during 
your comments or for the record in writing later, if you like, 
whether there will be an opportunity for the President's 
initiative to proceed with the benefit of the findings of this 
panel, which was supposed to be analyzing research data, coming 
up with techniques for screening, for teaching, suggestions 
about new ways to deal with problems of learning disabilities 
or reading disabilities, whether physical or emotional. The 
findings it seems to me can go a long way toward heading us in 
the correct direction and the right direction in trying to deal 
with this problem that is nationwide.
    I am not suggesting we need to federalize the reading 
instruction in our Nation's schools. What I am suggesting is 
for parents to have a better knowledge base in what to look for 
in terms of detection of early problems in children, and school 
districts to have the benefit of knowledge that has been 
developed by scientific-based research that is respected in 
this area so that we can develop at the local level or the 
State level, whatever the appropriate level is, the right kind 
of curriculum and initiatives to deal with reading problems at 
early ages.
    I am hopeful that you will look at the conference report 
again that was adopted by conferees on this subject wherein we 
talk about the importance of this reading panel that is going 
to be developing its findings and its recommendations. And I am 
going to read again into the record.
    ``The conferees endorse the language outlined in the Senate 
report''--this is the appropriations bill for this current 
fiscal year--``regarding research programs on reading 
development and disability, and also concur in the directive to 
the Secretary of Education to consult with the Director of the 
National Institute of Child Health and Human Development to 
convene a panel to assess the current status of research and 
effective approaches to teaching children to read.''
    We hope that the Department of Education will closely 
monitor the progress and try to see that the benefits of this 
research are disseminated for all who have responsibilities and 
interests in this area.

                       Title I allocation formula

    One other subject that I would like for you to look at and 
that is the title I program. It is designed to deal with the 
reality of poverty and the effects of poverty on children who 
grow up in that environment and the difficulties that they are 
confronting in trying to learn and succeed in school. We all 
know that the program was designed to provide school districts 
who have large numbers of these children with additional funds 
to help meet those needs.
    What worries me is that with the redesign of the title I 
allocation formula, a lot of States like mine are projected to 
get less money in the future than they have in the past for 
this program when we still have huge numbers of children who 
fall into the category of the population designed to be served 
by title I.
    What I am suspecting is that the reality of the political 
weight of the votes in the House of Representatives from 
population areas that are more influential because of their 
sheer numbers, we are seeing smaller States like my State of 
Mississippi and others like that getting less money now because 
of the pure, simple weight of the votes in the Congress and the 
influence that brings to bear on the policies that are made by 
this administration and by the Congress. I know the Congress 
helps write the allocation formula, but I suspect that there 
needs to be a new degree of attention being paid to this 
problem and I hope you can help ensure that this is done. Your 
comments along that line are what I am requesting.

                         Teacher training model

    Also your submission about the fact that our policies with 
respect to teachers, that we need to develop some kind of 
national model. I think the national writing project, which the 
administration has agreed needs to be funded this year, which I 
am glad to see, could serve as a nationwide model for teacher 
training. Rather than spending only $5 million on a program 
like this, make it the national model and spend the money that 
you had intended to spend in another area that would just be 
kind of spread out for everybody to experiment on their own. 
Here is a program that has proven to be effective. It has a 
huge constituency among those who have had the experience of 
the program. It works. Adopt it as the national model and fund 
it as the administration's model for teacher training.
    I have some other observations and questions which I will 
submit for the record, but I appreciate your attention to those 
issues.
    Senator Specter. Thank you very much, Senator Cochran. 
Before yielding to our distinguished chairman of the full 
committee, let me call on the ranking member of this 
subcommittee, Senator Harkin.

                 opening remarks of senator TOM HARKIN

    Senator Harkin. Thank you, Mr. Chairman. I apologize for 
being a little late. I just wanted to be here to again welcome 
Secretary Riley back to the subcommittee to discuss the 
administration's budget for the Department of Education.
    I want to state unequivocally that for the past 5 years, 
Mr. Secretary, you have been the voice and the advocate, the 
leading voice and the leading advocate, for improving public 
access, access to our schools, public education, and college 
education for countless Americans. There is no question, Mr. 
Secretary, about your dedication to making education a top 
priority in this country and your outstanding leadership. 
Indeed, President Clinton made a very wise choice in picking 
you to be Secretary of Education during this crucial period 
leading to the 21st century.
    I just want to commend you and compliment you in public for 
all that you have done. I have been involved in education a 
long time. I travel around the country, and everything I hear 
all over this country is thank God for Secretary Riley because 
we are moving ahead and we are making differences and we are 
making changes in this country.

                       Federal education funding

    Last year we had the single largest increase in education 
funding in more than 30 years. We enacted tax credits to help 
millions of Americans attend college. Again, this was done 
because of Secretary Riley's leadership, but it was also done 
on a bipartisan basis.
    I compliment our chairman, Senator Specter, for his 
leadership in guiding and directing this bill through, the 
largest single increase in education funding in 30 years out of 
this subcommittee. Senator Specter, you are to be commended for 
leading that charge.

                     Federal education initiatives

    Now, the administration's budget for next year builds on 
that success. It proposes bold actions. Too many students are 
taught in classes that are too large; 14 million students 
attending buildings that are unsafe; 5 million kids left 
unsupervised after school hours.
    So, these are all areas I know, Mr. Secretary, that you 
want us to look at and to approach in our appropriations 
process this year.
    So, I just want to say I applaud your leadership in 
attacking these serious concerns head on. These new investments 
that have been proposed by the President in these critical 
areas are ones that I strongly endorse, as well as many of the 
other recommendations in the 1999 budget request.
    Again, Mr. Secretary, welcome back and thank you for your 
great leadership.
    Secretary Riley. Thank you, sir.
    Senator Specter. Thank you very much, Senator Harkin.
    Our distinguished chairman of the full committee, Senator 
Stevens.
    Senator Stevens. Mr. Chairman, I am pleased to be here. I 
am familiar with your questions that you are going to ask about 
the gap in the amount of money that is sought and where it is 
coming from. So, I will just defer and wait for your questions.
    Nice to see you, Mr. Secretary.
    Secretary Riley. Thank you, sir.
    Senator Specter. Senator Bumpers.

                opening remarks of senator DALE BUMPERS

    Senator Bumpers. Mr. Chairman, let me just say that I want 
to echo virtually everything that Senator Harkin said about my 
admiration and respect for the Secretary. He is an educational 
icon to educators in this country. He has been a good personal 
friend of mine for many years, and I have never known anybody 
whose reputation is any higher for probity or dedication and 
determination, especially the latter two, in the field of 
education.
    My reason for being here is not to squawk at the budget. 
Everything about the budget pleases me. I am glad to see the 
increases. I have the utmost confidence in this Secretary to 
spend the money very wisely.
    When the time comes for me to ask questions, I can alert 
the Secretary to a very simple $1.8 million grant application 
that we included in the bill last year and have just been told 
by the Department that they would not fund. Is the Secretary 
familiar with that?
    Senator Specter. Well, Senator----
    Senator Bumpers. I just want to make sure he is prepared 
for the question.
    Senator Specter. Let us proceed with his testimony and we 
will come back to questions, if we may.
    Secretary Riley, that is a long introduction. [Laughter.]
    But a good part of it was filled with compliments which you 
may not have objected to too much. You have quite a lot of 
questions pending already from Senator Byrd and Senator Cochran 
and Senator Bumpers.

                Summary statement of Hon. Richard Riley

    Secretary Riley. If I might give a brief statement, Mr. 
Chairman, or would you like me to just go ahead and answer 
questions? I would like to cover a couple of points.
    Senator Specter. Your full statement will be made a part of 
the record, and to the extent you can summarize it and perhaps 
address the questions, I think that the questions which Senator 
Byrd and Senator Cochran have articulated are probably ones 
which you have on your mind in any event. So, the floor is 
yours as you see fit.
    Secretary Riley. If I might move through very quickly a 
very brief statement and submit the longer statement.
    Senator Specter. Fine.
    Secretary Riley. I am pleased to have Tom Skelly with me, 
my Budget Director, who has been with our Department, by the 
way, 24 years and worked side by side with Sally Christiansen 
for many years. So, Tom, it is good to have you with us.

               fiscal year 1999 Education budget request

    I am going to move quickly through the discretionary side 
of the budget. I would say that this budget continues our 
strong emphasis on helping children master the basics, turning 
around failing schools, protecting children from drugs, and 
speeding up the process of getting technology in the classroom.

                       Reading programs increases

    Our 1999 request includes a $392 million increase for title 
I and a total of $260 million for America Reads. Our goal for 
both of these programs and others is to make sure that every 
child can read well and independently by the end of the third 
grade, if not earlier.

           Third international mathematics and science study

    And we must do a better job at teaching our children math 
and science, Senator Byrd, as you pointed out. America's 12th 
graders really hit the bottom in the latest third international 
mathematics and science study, and the results are unacceptable 
to me and I am sure to each of you.
    Our schools, according to the TIMSS study, actually do a 
very good job of teaching the basics of science and math in the 
first four grades. Senator, this is dealing primarily with the 
question you asked. We fall behind, however, in the middle 
years. As you recall, in grade four, we were second only to 
Korea in science--with all the diverse schools in this country 
and all the fourth graders, second only to Korea and all of the 
countries in the study. In math we were way above average, in 
the top levels, up above above average. In middle school, we 
dropped. We were about average. We were just barely above 
average in science, barely below average in math, and then in 
high school, as you point out, we dropped.
    I can respond to some questions and some analysis about 
that in a moment.
    But among the problems is that only about 20 percent of our 
eighth graders take algebra; 100 percent of the eighth graders 
in Japan take algebra. Many high school students check out and 
do not take the tough math and science courses. They just kind 
of drift through school, oftentimes not taking those difficult 
courses.
    The reality is that many science and math teachers are 
teaching out of field. I was talking to a foreign education 
secretary recently and I said something about how that was a 
problem. They said, I don't know what you are talking about. 
They could not imagine having a math teacher who did not finish 
in math--whose field of study was not math. That is a real 
problem in this country.

        raising Expectations, standards, and teacher preparation

    All of this is compounded by the fact that we set very low 
expectations for our students, and I think that is probably at 
the heart and it touches much of what you said.
    The results from the TIMSS study provide ample evidence for 
why we need national standards of excellence. I think that is a 
very important move that you have made and all of us have made 
together, and why the Senate should continue to support the 
President's call for voluntary national tests in reading and 
math. Parents not only want to know how their country is doing 
from the sample test like TIMSS and NAEP, but they also want to 
know how their children are doing as well. The only way we can 
find that is to have a comparable test for an individual child, 
and that is what the proposal is.
    Our budget includes $32 million to begin implementing an 
action strategy developed jointly by the Department and the 
National Science Foundation to improve math and science 
instruction. We are also proposing to create a $67 million 
teacher recruitment and preparation program in the reauthorized 
Higher Education Act, which will go a long way I think toward 
preparing many more teachers to teach math and science.

                   programs to reform failing Schools

    Now, to turn around failing schools, we seek your support 
for a new $200 million education opportunity zones program, a 
$30 million increase in the comprehensive school reform program 
to help some 3,500 schools--that was a part of the proposal of 
last year, to increase that--and an increase of 25 percent in 
charter schools, enough funding to start up 1,400 new or 
redesigned schools. Urban school districts from Philadelphia, 
Mr. Chairman, to Chicago to Seattle are putting promising 
practices into place and are getting some results. I was in 
Seattle recently and was very pleased with what I saw there.
    But to turn around failing schools, you have to begin with 
safety, and that is why we propose a $200 million major 
expansion of the 21st century community learning centers 
program, the after-school program, supporting 4,000 after-
school centers, which serve as safe havens and learning places. 
We are requesting $50 million to put well-trained drug and 
violence prevention coordinators in one-half of all of 
America's middle schools.

               Teacher training and technology initiative

    Education technology remains high on our agenda. We are 
placing a special emphasis on a new $75 million teacher 
training and technology initiative to make sure that all new 
teachers can use technology effectively in the classroom.

                 Student financial assistance proposals

    Our request for higher education builds on last year's many 
accomplishments. We are seeking to increase the maximum Pell 
award from $3,000 to $3,100.
    We are proposing a $53 million increase for TRIO, a strong 
expansion of the very effective work-study program.

            partnership programs designed to raise Standards

    Over 930 colleges and universities now have committed their 
work-study students to America Reads, 48 of those being in 
Pennsylvania. Penn State, for example, has over 400 students 
involved, and the University of Pennsylvania has over 90 
students involved who are working with middle school-aged 
students, tutoring them for help.
    Finally, I make special reference to the high hopes for 
college proposal. Our $140 million request would create new 
partnerships between 2,500 middle schools and our Nation's 
colleges and universities over the next 5 years. These types of 
partnerships are, to my way of thinking, one of the most 
effective and low cost ways to get high standards into our 
Nation's classrooms.
    The Tell Them We Are Rising Program at Temple, and the 
Berkeley Pledge Program at UC-Berkeley are two examples of 
these. I had the opportunity to be at Berkeley recently and to 
go out to a school in Richmond with Bob Berdahl, the 
chancellor, to see the wonderful work that Berkeley is doing 
with this little, relatively poor--many of the kids are poor--
school. They are working one on one with them.
    In conclusion, I am prepared to work with the committee to 
craft a budget that reflects the high priority that the 
American people are placing on education. I think that is 
apparent. I believe we can succeed in the effort, if we 
continue as we have in the past, to leave politics at the 
schoolhouse door and work for the common good of all children.

                           prepared statement

    Now I would be happy to respond to questions, Mr. Chairman. 
Do you want me to address Senator Byrd's? Senator Cochran has 
left, and I will be glad to respond to his questions or give 
them to him in writing. How would you like me to proceed?
    [The statement follows:]
                 Prepared Statement of Richard W. Riley
    Mr. Chairman and Members of the Subcommittee: I am pleased to have 
this opportunity to talk with you about President Clinton's 1999 budget 
request for the Department of Education. This Subcommittee has produced 
strong budgets for education over the past few years, but I think you 
will find that the President's 1999 budget represents the most 
comprehensive effort yet to raise standards and give schools, teachers, 
and students the tools to reach those standards.
    The American people have made education their number one priority, 
and the President's budget for education reflects their concerns. In 
particular, the 1999 request includes the largest increase in 30 years 
for Federal elementary and secondary education programs. Our purpose is 
straightforward: we want our elementary and secondary schools to match 
the world-class quality of our colleges and universities.
    The President's 1999 budget proposal would reduce class size in 
grades 1-3, help school districts build new schools and modernize 
existing ones, improve teacher quality, target new assistance to poor 
urban and rural schools, help bring technology into the classroom, and 
give all Americans the financial support and information they need to 
go to college.
    We are requesting a total of $31.2 billion in discretionary budget 
authority for fiscal year 1999, an increase of $1.7 billion or almost 6 
percent over the 1998 level. The request also includes two major 
education initiatives that fall outside of the discretionary budget, 
and I want to briefly mention these before moving on to a summary of 
our discretionary request.
                   class size and school construction
    First, President Clinton is proposing to spend $12 billion in 
mandatory funds over the next 7 years to recruit and train 100,000 new 
teachers. These teachers would help reduce class sizes in grades 1-3 to 
a nationwide average of 18 students. We believe that small classes are 
critical to giving our youngest students the foundation they need for 
high achievement in the later grades. In particular, small classes 
would help ensure that all children are able to read well and 
independently by the end of the third grade.
    In addition, small classes would make it possible for teachers to 
provide extra support and attention to children with special needs, 
including children with disabilities and children with limited English 
proficiency. The 1999 budget includes $1.1 billion in mandatory funding 
to launch the Class-Size initiative.
    Second, the President is proposing Federal tax credits to pay the 
interest on almost $22 billion in bonds to build and renovate public 
schools. Schools across the country are suffering from overcrowding, 
created in part by the ``baby boom echo'' that will increase school 
enrollments every year for the next 10 years. These growing enrollments 
create a tremendous need for new schools in many districts.
    In addition, the General Accounting Office has reported that 
existing schools require over $100 billion in repairs to ensure that 
teachers can teach and students can learn in safe and orderly 
conditions. I would also note that beyond the issue of safety is the 
need to modernize schools to take advantage of educational technologies 
like computers and the Internet.
    The President's proposal would help to build or modernize an 
estimated 5,000 public schools, with half of the support allocated to 
the 100 school districts enrolling the largest numbers of poor 
students. I want to emphasize, however, that the Class-Size and School 
Construction initiatives would improve educational opportunity and 
achievement for all students.
                   helping children master the basics
    Turning now to the President's discretionary request for the 
Department of Education, we are continuing our emphasis on helping 
children master the basics. We know that early competence in reading 
and math is critical for all children, but it is particularly important 
for disadvantaged and limited English proficient students, who often 
fall behind early and find it difficult to catch up in the later 
grades.
    The primary Federal program for raising the achievement of such 
children remains the Title I Grants to Local Educational Agencies 
program. The 1999 request includes a $392 million increase for Title I, 
all of which would be distributed to high-poverty urban and rural 
schools through the Concentration Grants and Targeted Grants formulas.
    We also are proposing to increase the number of teachers qualified 
to teach the basics to Hispanic and other limited English proficient 
students by doubling funding for Bilingual Education Professional 
Development to $50 million.
    The budget provides $260 million for America Reads, which would 
support local programs that provide tutoring and help improve reading 
instruction in our schools, so that every child can read well by the 
end of the 3rd grade.
    In mathematics, we have new and disturbing evidence that our 
students are far short of where they need to be to compete in the 
knowledge-based economy of the 21st century. Last week, the Department 
released the latest results of Third International Math and Science 
Study (TIMSS), on which U.S. 12th graders outperformed only two of the 
21 participating countries in math and science.
    This level of performance is just unacceptable, and to my mind 
confirms the need to raise standards dramatically in American schools. 
When the 8th grade math curriculum in American schools looks like the 
7th grade curriculum in other countries, and when 28 percent of our 
high school mathematics teachers did not major or minor in mathematics 
in college, it is clear that we have not set our expectations high 
enough. The TIMSS results provide yet more evidence that we need 
national standards of excellence in core subjects like mathematics and 
science. The President's call for voluntary national tests in reading 
and math is intended to address this need, and I hope the Senate will 
continue to support the development of these tests.
    The 1999 budget also would help improve teaching and learning in 
math and science by providing $32 million to implement an Action 
Strategy developed jointly by the Department and the National Science 
Foundation. The strategy is designed to improve the math teaching of 
elementary and middle school teachers, assist communities in the 
selection and implementation of rigorous instructional materials, 
maximize the effective use of existing Federal resources, and promote 
public understanding of the importance of challenging middle school 
math.
          raising achievement in poor urban and rural schools
    A second priority in the Department's discretionary request is to 
support fundamental change in America's urban schools, where promising 
efforts to turn around low-performing schools are starting to take 
hold. While much of our proposed investment in helping children master 
the basics will help urban schools, the budget includes several 
initiatives targeted on the special challenges faced by poor urban and 
rural schools.
    For example, the new $200 million Education Opportunity Zones 
program would make approximately 50 grants to poor urban and rural 
districts to improve accountability, raise teacher quality, and expand 
public school choice. A $30 million increase in the Title I 
Comprehensive School Reform program would help some 3,500 schools 
accelerate educational improvements and turn around failing schools. A 
25-percent increase in Charter Schools would support the expansion of 
public school choice through the start-up of up to 1,400 new or 
redesigned schools. And to help recruit and train new teachers for 
urban and rural areas, we are proposing to create a $67 million Teacher 
Recruitment and Preparation program in the reauthorized Higher 
Education Act.
    School safety is a special concern in high-poverty areas, and 
extended learning time can help disadvantaged students catch up in 
their academic skills. That is why this budget includes a $200 million 
major expansion of the 21st Century Community Learning Centers program, 
which would support keeping approximately 4,000 schools open after-
school as extended learning safe havens. In addition, we are requesting 
$50 million to hire Safe and Drug-Free Schools Coordinators, who would 
help almost half of all middle schools develop and implement effective 
strategies for keeping our kids away from drugs.
                         educational technology
    A third priority--one that I know is shared by several members of 
this Subcommittee--is educational technology. A $50 million increase 
for the Technology Literacy Challenge Fund would help more schools buy 
hardware, train teachers to use technology, and develop and buy 
software. The $106 million request for Technology Innovation Challenge 
Grants would support 24 new awards to develop or adapt cutting-edge 
technology for America's classrooms. And a new $75 million Teacher 
Training in Technology initiative would help make sure that all new 
teachers can use technology effectively in the classroom.
              helping students prepare and pay for college
    Finally, our 1999 request builds on last year's historic 
achievement in helping students and families pay for college, which 
included a $300 increase in the maximum Pell Grant award and the 
creation of the HOPE Scholarship and Lifetime Learning tax credits.
    The President's budget proposes $7.6 billion for the Pell Grant 
program, an increase of $249 million that would further raise the 
maximum Pell award from $3,000 to $3,100. A $70 million increase for 
Work-Study would reach the President's goal of giving one million 
recipients the opportunity to work their way through college, while 
also supporting additional Work-Study tutors for America Reads.
    We are asking for $583 million for the TRIO programs, a $53 million 
increase aimed at expanding the number of Upward Bound projects--
especially in under-served areas including Hispanic students. TRIO's 
efforts to encourage low-income students to prepare for and enter 
postsecondary education would be reinforced by the HIGH HOPES 
initiative.
    HIGH HOPES for College for America's Youth would promote 
partnerships between colleges and middle or junior high schools in low-
income communities. Beginning in the sixth or seventh grade, the 
program would give students information about college and what it takes 
to go to college, along with support services like mentoring and after-
school activities that help children stay on track to complete high 
school and enroll in college. The $140 million request for HIGH HOPES 
would be the first step toward serving more than 1 million students in 
2,500 middle schools over the next five years.
                               conclusion
    The 1999 request for the Department of Education reflects an 
ambitious and comprehensive effort to help States and communities 
address critical issues in education and prepare our children for the 
challenges of the next century. I believe we can succeed in this effort 
if we continue--as we have in recent years--to leave politics at the 
schoolhouse door and work for the common good of all our children.
    I will be happy to take any questions you may have.

                      Math and science achievement

    Senator Specter. Well, Senator Byrd cannot be with us long, 
as I understand his schedule, so if you would respond at this 
point to his question, we will then proceed with a round of 
questions for the members.
    Secretary Riley. Fine.
    Senator, I certainly agree with the tenor of the strong 
concern you have for excellence in education, and I tried to 
address in my statement some of the TIMSS issues.
    Let me say some more on that. It is very clear to me that, 
for example, our 8th grade students, generally, in math and 
science are taking what 7th grade students are taking in most 
of the countries that did a lot better than us in the middle 
schools and in the 12th grade.
    However, we have improved performance in math and science 
almost a grade level over the last 12 to 14 years. That has 
been a result of targeting on math and science--coming out of 
putting a person on the Moon and all those other efforts to 
target math and science education. Obviously, we have not 
improved enough. Others have gone up probably a grade level 
plus.
    So, we have made improvement. We are making improvement.
    The fact that we do so well in the fourth grade certainly 
makes it right clear that the basics that we have up through 
the fourth grade we are excelling in, leading the world in 
science and almost in math. Then we begin to drop. I think a 
good part of it is low expectations. We do not demand enough, I 
think, for some of our students, as you pointed out, and of 
teachers in the system. In high school, 25 percent of our 
students, for example, take physics. In countries we are 
competing with, about 75, 80, to 85 percent take physics. So, 
our students compare on a physics exam very poorly.
    Those kinds of things I think we can do something about. I 
do think we ought to start urging 4 years of math and science. 
I remember when I was Governor of South Carolina and raised it 
to 3 years of math and science, people thought that was rather 
dramatic. Now it is clear to me that we need 4 years of math 
and science, and, of course, I hope States would use the TIMSS 
information to move that forward.
    As you know, I support the tenor also of the Byrd 
scholarship which is merit driven, and that also makes a very 
good statement I think and I am very pleased that it is in our 
budget.

                          Parental involvement

    So, I think high expectations and parental involvement are 
needed. Parents are involved more in elementary school 
obviously than middle school and high school. I think it is a 
good thing for us to urge parents to get more involved with 
their children in middle school and high school and talk with 
them about the kinds of courses they ought to be taking to go 
to college, to be successful in life, and talk with them about 
drugs and about smoking and about alcohol or whatever. So, I 
think parents are a very critical part of the mix also.
    Mr. Chairman, do you want me to address Senator Cochran's 
issues or wait----
    Senator Specter. I think Senator Cochran may be rejoining 
us. He said he would try to return. So, let us await his 
return.
    Now we will start 5 minute rounds for members.
    Senator Byrd. Mr. Chairman, before you begin, may I thank 
you again and may I thank all the members of the subcommittee 
for being so patient with me. I am not a member, and the 
subcommittee has been very gracious.
    And I thank you, Mr. Secretary.
    Secretary Riley. Thank you, sir.
    Senator Specter. Senator Byrd, I know I speak for all the 
members. We are glad to have you here. Thank you.
    I said at the outset, and a number of members have joined 
since, that following your testimony, Mr. Secretary, we have a 
hearing on campus safety, and after we had scheduled these 
hearings, Governmental Affairs scheduled at 4 o'clock a 
proceeding on the report which is going to be very complicated 
and contentious. So, it is my hope we will conclude by 4 
o'clock.

            Budget offsets--tobacco settlement and user fees

    We are going to proceed now with 5 minute rounds. So, the 
first question I have for you, Mr. Secretary, is in making your 
budget projection, $1.9 million is based upon proceeds from a 
tobacco settlement and from unauthorized user fees. If we do 
not get those sources of revenue, which are right now highly 
speculative, how will we pay for that $1.9 billion?
    Secretary Riley. Well, I understand from what was said 
earlier by Senator Harkin or one of the Senators that there is 
some positive information developing, hopefully, on that issue.
    Senator Specter. Positive information developing, 
hopefully.
    Secretary Riley. Hopefully. [Laughter.]
    Senator Specter. That is a long way from being a bird in 
hand.
    Secretary Riley. If that is resolved and, of course, those 
funds are there----
    Senator Specter. If not?
    Secretary Riley [continuing]. Then we think the best use of 
the funds would be as we indicate. If not, which is your 
question, then we still think the idea of sending funds to the 
States for them to use to reduce classroom size for those early 
grades one, two, and three, and especially for hiring teachers 
specially trained in reading, that this would be very, very 
helpful for this country. All we can say is that we think those 
are very worthwhile purposes. If this offset is not there, then 
we would welcome other offsets or suggestions and would be 
happy to discuss those kinds of things with you.
    Senator Specter. We too would be interested in welcoming 
other suggestions, but this budget is very problemsome, Mr. 
Secretary, because of that $1.9 billion gap.

           Class size reduction--use of parochial classrooms

    But let me go on to another question and that is on the 
President's initiative on class size reduction. The 
subcommittee asked for a study by your Department, which is not 
yet complete except for some information. This is an idea 
advanced by Cardinal Bevalaqua of Philadelphia where the 
schools are overcrowded, yet the Catholic schools have a lot of 
space. It costs $7,000 a year to educate a student in the 
Catholic schools. Cardinal Bevalaqua would like to open his 
doors for $1,000.
    It obviously implicates church-State separation. Can you 
give me your view on that sort of a proposal?
    Secretary Riley. Of course, we were asked to give a report 
back on that subject, and we will have that to the Congress by, 
probably, April. We are just about completed with it.
    Some of the initial findings of the report are that among 
the 34 large urban school districts, 22 reported some 
overcrowding in anywhere from 13 to 91 percent of their 
schools. The associations representing private schools 
indicated that private and parochial schools have some space 
available, but approximately one-half of those associations 
believe that the space is quite limited. That was a mixed view. 
As I say, this is not final information.
    The associations also indicated some problems and concerns 
that would develop in such a transfer. Schools could maintain 
their current curriculum, their current admissions, assessment, 
and other policies without change. These concerns are what came 
back to us. Religious schools would not be required to permit 
exemptions from religious instruction to transfer students. 
Private schools would not be required to serve a large number 
of students with special needs. There would be no increase in 
Government control of private schools and so forth.
    So, you have a lot of concerns expressed by private schools 
that if they get into this, they do not want to shift the 
nature of their private school basis. We have not completed 
that study, but those are some questions that have been raised 
to us by some of the private school people.

                       Campus Security Act panel

    Senator Specter. Well, my yellow light is about to turn to 
red, and I want to maintain the timing. So, I will conclude my 
round simply by pointing out another panel we are going to have 
on compliance with the Campus Security Act, and I would hope 
that you could stay for a few minutes, Mr. Secretary, although 
your assistant, Mr. David Longanecker, will be the principal 
witness.
    Senator Harkin.
    Senator Harkin. Thank you, Mr. Chairman.

                Youth violence and after-school programs

    Mr. Secretary, I have here an article from the Des Moines 
Register last fall, and the headline reads ``Killing Time 
Literally After School.'' It talked about a study that was done 
at Northeastern University, the College of Criminal Justice in 
Boston by Mr. James Allen Fox about the fact that juvenile 
crime is worse in the afternoon--and not late at night--between 
2 p.m., and 8 p.m. Almost 50 percent of violent juvenile crimes 
occur between 2 p.m., and 8 p.m. Only one-seventh occurs 
between 11 p.m., and 7 a.m., when curfews typically are in 
effect.
    I know that you want to address this issue, and you can 
tell us more about your efforts, what you want to do in getting 
after-school programs?
    I will just say that James Allen Fox said in the afternoons 
we used to have sports, drama, and music. We had violins and 
now it is violence.
    So, what exactly are you proposing, Mr. Secretary?

                21st century community learning centers

    Secretary Riley. Well, last year, this current budget year, 
you approved our request for the 21st century community 
learning centers and appropriated $40 million for that program. 
That was in my judgment a very wise move.

                         After-school programs

    We have proposed in this budget to raise the $40 million to 
$200 million and to have it funded for 5 years, $1 billion over 
5 years going to after-school programs. It is all involving 
partnerships, quality programs that would address the issue 
that you raise. Parents want children, if they are in after-
school programs, to have access to computers, art programs, 
academic programs, sport programs, those exciting, interesting, 
engaging things to do, not just to bide time, but for there to 
really be learning time that is also interesting.

            Mott Foundation funds for After-school programs

    The Mott Foundation, by the way, a private foundation, was 
so interested in that purpose, the after-school purpose, that 
they have committed $55 million over a 5-year period to place 
emphasis on quality in those programs. They had people come in 
and meet and talk about how best to implement after-school 
proposals, how to set up the after-school programs. Mott had 
bidders conferences around the country and 5,000 people 
attended.
    In this $40 million program that you all approved last 
year, we had room for funding perhaps 400 of these programs; 
16,000 requests were made about the program.
    I do not think there is any question that this is the right 
direction to go. If we are going to solve many of the problems 
that TIMSS and other studies have shown, we have got to make 
good use of that after-school time for all children. That is 
it, and as you point out, youth crime and victimization both 
happen primarily during the time, as they say, the school bell 
rings and before the factory whistle goes off. So, I am very 
hopeful that you all would fund that additional amount for that 
existing program.
    Senator Harkin. Thank you, Mr. Secretary.
    I also think that that is one of the most important things 
that we can be about. I think it is one of the great helps that 
we can give our elementary and secondary students around the 
country.
    I see my time is running out.

                  Math and science achievement--TIMSS

    I just want to ask you about the TIMSS study. How come? 
Just one more time. Why in the 12th grade we are so low, 4th 
grade we are so high? What is happening between the 4th and the 
12th grades?
    Secretary Riley. Well, I will not repeat all of the things, 
but the TIMSS study observed in eighth grade that the American 
curriculum was an inch deep and a mile wide. The curriculum, 
for example, in Japan in eighth grade would have like seven 
topics. America would have like 32 to 33. There is not anything 
wrong with that at all, but it is just kind of the way we go 
about teaching math and science, a little bit of everything.
    Their suggestion, of course, is to get deeper into fewer 
topics early to build a foundation for high school. A key way 
to do that is algebra. To have algebra in the eighth grade we 
think is absolutely critical. There is no reason in the world 
why our students cannot have algebra and some geometry by the 
eighth grade. That is what happens in practically every other 
country we are competing with and having difficulty with.
    I think the programs that we have proposed are having a 
quicker effect in elementary school also. The high standards I 
think are working, and the technology things that we are doing. 
Title I largely funds those early school years, and the changes 
in title I, doing away with the watered-down curriculum, and so 
forth are producing results. I think all of that is making a 
big difference.
    Then when you get on up into high school--this test was 
given in 1995. Maybe there are some changes that are taking 
place now, but not near enough, not near quickly enough.
    Senator Harkin. Thank you very much, Mr. Secretary.
    Senator Specter. Thank you, Senator Harkin.
    We are going to proceed with order of arrival, which is the 
subcommittee rule. We next go to Senator Bumpers, then Senator 
Faircloth, Senator Gorton, and Senator Kohl. Senator Bumpers.
    Senator Bumpers. Thank you, Mr. Chairman.

           Mississippi Delta early childhood services project

    Mr. Secretary, last year this committee and the conference 
committee put a $1.8 million grant in its report for the Easter 
Seals of Arkansas to do a demonstration project in the delta 
region of Arkansas, Louisiana, and Mississippi. The idea being 
that early childhood specialists would serve children with 
disabilities in the delta region--right now these children have 
to be taken to Little Rock. Transportation is a big problem, so 
a lot of them do not even bother to go.
    They are wanting to prove something which really I suppose 
we all already know, but at the end of the three demonstration 
projects, they intended to put rehabilitation experts there to 
live in the delta and serve the poor disabled children there.

           Mississippi Delta project--Easter Seals Foundation

    We thought it was all saucered and blowed, as we say in 
Arkansas. Senator Specter was very kind to put it in his mark. 
The members of the delegation in the House from those three 
States, as well as the Senators from those three States, wrote 
letters. We did not put it on our wish list until we talked to 
the Office of Special Education and Rehabilitative Services of 
the Department of Education who assured us that they would 
honor this report language.
    The worst part of it is, the Easter Seals of Arkansas began 
hiring medical and planning staff and then suddenly we get a 
letter about 1 or 2 weeks ago saying the Department will not 
provide the $1.8 million.
    And this has created a real problem. Not only do we need 
the demonstration project for one of the poorest areas of the 
United States, but the Easter Seals of Arkansas have agreed to 
take on the continuation of this at the end of 3 years by, as I 
say, providing special education and rehabilitative services 
down there to those children. It seems like a really wonderful 
deal for the Department of Education, but right now it is a 
traumatic thing for everybody because we suddenly get this 
letter out of the blue sky from a Judith Heumann. Is that the 
way you pronounce it?
    Secretary Riley. Yes.
    Senator Bumpers. Saying they were not going to honor it. As 
I say, we would not have even put it in our wish list had we 
not known it was going to be honored.
    Secretary Riley. Well, Senator, let us continue to work 
with you on it. These were competitive grants, that is the way 
these are handled. Another competition I think, Tom, is coming 
out very soon?
    Mr. Skelly. The Easter Seals Foundation may be eligible for 
more than one competition. The competition that you addressed 
in the report is one where the average grant is about $150,000 
per year.
    Senator Bumpers. That does us no good. We got the letter. 
That was the suggestion, that this competition was available to 
us. If we won it, it would be $150,000. It does not even 
scratch the surface on what we are trying to do.
    Mr. Skelly. It would be $150,000 per year.
    We are considering yet another competition for which Easter 
Seals might also be eligible. We have not announced that 
competition yet. So, it is possible that the second competition 
would be for a larger amount of money. We have not worked out 
all the details.
    Senator Bumpers. Mr. Skelly, with the utmost respect, why 
did you not make all of these excuses back when we talked to 
you in the first place before you committed to us that you 
would honor this? I mean, I am aware of all of that. Easter 
Seals is aware of all of that. The letter said that we had 
substantial unexpended funds. The truth of the matter is we do 
not have substantial unexpended funds, and $150,000 does not 
get the water hot. I have a list of five things that were set 
out in Ms. Heumann's letter and none of them really help us at 
all.
    Mr. Skelly. We will be looking into that situation again 
more, Senator. There are funds provided under State grants to 
the area, and our staff have talked to the State 
representatives and others down there about possibly getting 
more of that money that is already provided from the Federal 
Government to the States for these same services. But I 
understand there is a problem in getting enough trained staff 
to work there, and that is why we are interested in looking at 
Easter Seals as a source of the kinds of services that could be 
provided to students down there.
    Senator Bumpers. Mr. Secretary, this is really a dismaying 
situation for me personally and especially for the Easter Seals 
of Arkansas who looked forward to doing this project and, as I 
say, who have already hired some people in anticipation of it. 
Then all of a sudden out of the clear blue sky, 4 months after 
the President signs the bill, we get a letter saying the 
Department would not honor it.
    Secretary Riley. Well, Senator, I certainly will take a 
look at that and be back with you on it. I understand the 
technicalities that we are talking about, but I would strongly 
support the sentiment of what you are trying to do. Let me take 
a look at it and see if there is any earthly way that we could 
visit it.
    Senator Bumpers. Thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Senator Bumpers.
    Senator Cochran had been here earlier, had propounded a 
series of questions, and the Secretary had wanted to know 
whether he should answer them earlier and I said you expected 
to be back. So, if it is your pleasure, he will proceed now to 
answer them.
    Senator Cochran. Thank you very much, Mr. Chairman. I 
appreciate that very much.
    Secretary Riley. Senator, I have gone through so much since 
you left.

                        America Reads Challenge

    Senator Cochran. I will refresh my memory and yours too. I 
discussed the reading research initiative at NIH.
    Secretary Riley. I think we are together on that. I do not 
have any problem with that, and I think we are together on that 
as far as the America Reads Challenge. It is a locally driven 
program, as you know, America Reads. We do not tell them what 
to do. OERI does work hard, though, to give out research 
findings like these, and I will assure you that that will be 
done. It will be disseminated and they will have it. Of course, 
as you point out, we do not control that and do not try to, but 
they will have that information.

                  Title I allocation formula revision

    Senator Cochran. The other subject was title I and the 
allocation formula. It looks to me like the money is now going 
where the votes are rather than where the needs are.
    Secretary Riley. Well, what we want the money to do is to 
go where the kids are, and if it is for disadvantaged kids, 
that is what we are trying to help develop, a formula to target 
the money to go where they are. That is our philosophy on it. I 
realize you differ with some of the census procedures as far as 
determining the allocation. But what I am trying to do--and of 
course, the National Academy of Sciences is advising us on 
that--is to try to have the money go where the poor children 
are.

                        National writing project

    Senator Cochran. The third topic that I broached was the 
writing project and the efficacy of that program as a national 
model for teacher training. You are spending money for teacher 
training, only a small amount, although I am glad you are 
suggesting that we spend some on the writing project. I am 
suggesting enlarging that as a national model and using it 
nationwide.
    Secretary Riley. Well, let me take a look at that. We agree 
with you on the writing project. I think that is a grand 
project and we recommended funding of it, as you point out, and 
I will look at further use of it. I think that is a good 
suggestion, but certainly we agree with you on the project.

                     ``Readline'' and ``Mathline''

    Senator Cochran. Some of the submitted questions include 
things like ``Readline.'' That is a televised program. WETA has 
pioneered an effort to help develop reading competence, and I 
hope you will look at that as a program that ought to be funded 
with Federal dollars by the Department of Education.
    Secretary Riley. All right, sir.
    Senator Cochran. And ``Mathline'' is a similar project. 
``Readline'' and ``Mathline.'' Well, they are similar things 
but they are using the technique and the technology of 
television. We do know that children watch a lot of television, 
and we are trying to, in the process, help to educate by the 
use of that technology too, and these are new techniques for 
doing that.
    Senator Specter. Thank you very much, Senator Cochran.
    Senator Faircloth.
    Senator  Faircloth. Thank you, Mr. Chairman.

        Education funds going directly to students and teachers

    Secretary Riley, when will the Department submit to the 
Congress the report on how much money reaches the students and 
teachers that I requested in last year's appropriation?
    Secretary Riley. It is my understanding that April 1--is 
that right, Tom?
    Mr. Skelly. That is right. We plan on having our report, 
Senator, by April 1.
    Senator  Faircloth. You are going to have it by April 1.
    Secretary Riley. April 1.
    I am very interested in the subject, and I am glad you are. 
I really think it is worthy for us to be doing some work on. 
This idea of what gets down to the classroom I think is very 
important.
    Senator  Faircloth. We will get it in April.
    Secretary Riley. My estimate here is by April 1, yes, sir. 
I will try to get it to you by then.

                     interest rate on Student loans

    Senator  Faircloth. Mr. Secretary, as you know, after July 
1 of this year, there will be a decrease in the interest rates 
that banks and other institutions can charge for federally 
backed student loans. Banks have indicated that this will make 
student loans completely unprofitable for them, and they will 
significantly reduce their participation in the program unless 
there is an adjustment made, I assume leaving many students 
stranded for lack of loans.
    As a member of the subcommittee and as a member of the 
Banking Committee, I have been somewhat concerned about the 
matter and wanted to know if you would please comment as to 
where this is going and address the problem.
    Secretary Riley. Yes, sir, Senator. The Treasury Department 
has done substantial work on that. I think it is a very serious 
problem that needs to be dealt with. They have come up with a 
proposal and it was announced recently by the Vice President. 
It was a proposal that would use the 91-day Treasury bill, 
which is what they very much wanted. They wanted it to be 
consistent with the 91-day movement and not into the 10- to 20-
year securities. That part I think would be a tremendous help, 
stabilizing help, for the lending institutions.
    The main part of the change that was made originally, of 
course, was to help students, to help them get a reduction in 
rate. The proposal that the Treasury Department comes up with 
protects the students with a low rate but changes the method 
around to where we think it would be a lot more appealing to 
the lenders.
    So, that is now into the process of discussion, but we have 
put a very substantive, which I think is a very good and fair 
proposal, on the table. I know some other committees are 
looking at that here. That discussion is now underway. Of 
course, we would like to get it resolved by the July 1 deadline 
and think that is very important. We do have what I think is a 
very responsible proposal on the table.
    Senator  Faircloth. Are you going to get it solved by July 
1?
    Secretary Riley. I think so. I think clearly we will. I 
think everybody is now coming together to try to get it 
resolved, and everybody wants to get it resolved. So, I think 
it will be resolved, yes, sir.

                            School uniforms

    Senator  Faircloth. Secretary, one time way back when--
early on with President Clinton early in office, the Department 
put out a notice with a lot of material, pamphlets, on how 
schools could switch to school uniforms like Winthrop and what 
a great thing it would be. There was a lot of effort that went 
into it. I am interested in how many schools went to the 
uniform system.
    Secretary Riley. I do not know exactly. That is a very good 
question, and I will check that out and let you know. I will 
tell you this: a lot of them. I go around to a lot of schools 
and I am seeing more and more, especially elementary schools 
and a lot of middle schools, with children in uniform.
    What our information, which was an analysis of where school 
uniforms are used around the country successfully, like Long 
Beach--and I was just out there the other day, and it is very 
successful out there--said, is that the discipline is better. 
Crime is down. Violence is down, and so forth. It does not 
solve all problems, but in most places it is a help--and our 
data showed us if you go to the parents first and you get the 
parents to support uniforms, then you have kind of a collegial 
feeling about that and not a top-down attitude, saying to 
people, this is how it is going to be, you have to do it. If 
you get them involved in the decision, it seems to work better 
than if you do not. But those places that have done that, it 
seems like they have had very good success with it, and we are 
very positive about it.
    Senator  Faircloth. I think it is an excellent idea and I 
hope you will push it. Thank you.
    Secretary Riley. Thank you.
    Senator Specter. Thank you, Senator Faircloth.
    Senator Gorton.
    Senator Gorton. Mr. Secretary, because of this 5-minute 
rule, I am going to go through three subjects and see if I can 
get through all of them, and then ask you to answer.

                           Closed captioning

    The first one is simply a bit of advice. In the last couple 
of days, you have come into this controversy with respect to 
your grant programming for closed captioning of television by 
reason of a letter to you from Senators Lieberman and Coats. 
One of your assistants has said that it is perfectly 
appropriate to fund closed captioning for the ``Jerry Springer 
Show,'' described by the letter as the closest thing to 
pornography on broadcast television and by another as a show 
that puts on more fights than Don King because it is a part of 
the culture, according to your subordinate.
    Your other spokeswoman yesterday said that, well, these 
grants are given to people who then give the grants, so you are 
not responsible for what goes on after that, and you are not in 
the business of censoring.
    Now, I should remind you, Secretary Riley, this was exactly 
the way NEA got into problems with Maplethorpe by saying, well, 
we did not really do it, one of our grantees did it. I spent a 
lot of my time barely saving the existence of the National 
Endowment for the Arts, and I would strongly advise you that 
you do something about this one, rather than get into the kind 
of controversy NEA found itself in. That is pure advice. You 
can respond to it or not.
    Secretary Riley. Let me----
    Senator Gorton. I have got to go through all of this.
    Secretary Riley. Well, if you could have a little extra 
time, I would appreciate it because I would like to just give a 
response.
    Senator Gorton. Fine, but my light is going to go off. So, 
I am going to give you two other subjects now and then I will 
listen to your answer to all three of them.

                             Local control

    You were in Seattle last month and you called for people to 
choose solutions instead of choosing sides, a statement that 
was quite consistent with your state of the education speech 
last year when you said that we should not--and I quote--
``cloud our children's future with silly arguments about 
Federal Government intrusion.''
    It seems to me--and you can comment on this if you think 
this is an erroneous interpretation--that agreeing with your 
philosophies is choosing solutions, and espousing a philosophy 
that states that educators, parents, teachers, administrators, 
and school board members in our local communities should have 
far more authority and you far less in choosing sides and 
making silly arguments about Federal Government intrusion.
    I would like your comment on that. Is this just rhetoric, 
or do you really believe that those who feel that these 
decisions should be centralized are making silly arguments and 
are choosing sides?
    And finally, with respect to the specifics of your budget, 
I find it interesting to note that those areas, the two major 
areas that provide the greatest degree of flexibility to local 
school districts to make their own choices, are the ones that 
are least favored in this appropriation.
    You simply wiped out the title VI block grant program, 
stating in your budget some States and districts funded the 
same activities year after year with little thought as to the 
most appropriate use of title VI funds. That seems to me 
consistent with the proposition that the locals do not know 
what they are doing but you do, so we wipe that out and put it 
into prescriptive forms of funding. That was cut out 
completely.
    The other area in which you have substantial reductions is 
impact aid where again school districts are able to make their 
own choices and are funded for the impact that the Federal 
Government has on them.
    Finally, IDEA. I have had several education seminars in the 
last few weeks, and the overwhelming reaction from the people 
who run our schools is utter frustration with IDEA. We passed 
the reauthorization of that law last year that we intended to 
be at least slightly less prescriptive on locals. Your proposed 
regulations make it more prescriptive, and at the same time 
that you make it more prescriptive, you effectively cut the 
budget, at least the student budget, for IDEA.
    Why is it, Mr. Secretary, that in a program like that with 
detailed regulations from the Federal Government, you propose 
to fund about 9 percent of the cost to school districts but to 
take all kinds of money, literally millions of dollars, and 
fund new programs with rules and regulations from the Federal 
Government? Should we not first fund the activities we have 
already mandated on school districts before we start a bunch of 
new programs?
    Senator Specter. I compliment my distinguished colleague, 
Senator Gorton--you are a very experienced questioner--for 
being within the 5-minute rule. [Laughter.]
    Now we will see how long the answers take.
    Secretary Riley. I will proceed to respond, but there are 
five or six very serious questions, Mr. Chairman, if I can 
respond to them.
    Senator Specter. You may respond.

                           Closed captioning

    Secretary Riley. First of all, on the closed caption issue, 
I think I would agree with you on the particular show. The 
``Jerry Springer Show'' I have never seen. I do not care to see 
it. I have never heard anything about it that I liked.
    There is a process that we use for these captioning 
programs. We give the grants out. The grantees then bring in 
panels of deaf, hard-of-hearing people to say what they would 
like to have included.
    I will say that the closed captioning program, Senator, has 
done a lot of good. We funded 100 percent of captioning in the 
beginning and now private industry is picking some up. As you 
watch on television, a certain company will pay for it. Now we 
fund about 40 percent, and I hope to get that down to zero. We 
are moving that down very quickly, and I think it is. 
Captioning has gotten tremendously improved. So, it is a good 
thing.
    Picking the programs, we try not to do that. We let the 
grantees, through panels of deaf people, pick the programs to 
be captioned. This program happens to be the most popular talk 
show in daytime television. The FCC approves it for daytime 
television. That is what other people want to watch, and the 
fact that deaf people and hard-of-hearing people want to watch 
it, I think, is understandable. It becomes a censoring kind of 
problem.
    I will follow your advice and take another look at any way 
that we think we ought to get involved. I want to be honest 
with you. I want to be very, very careful about telling hard-
of-hearing and deaf people what they ought and ought not want 
to see.
    One person told me today, when I was asking about that, 
that if there was a deaf parent who had speaking children who 
could hear, that parent would like to know what that program is 
about so they could say whether or not they wanted their child 
to watch it. I do not know how many other situations are like 
that.
    But it is quite different I think from the art situation. 
This is a group of people that have a right to see things on 
television and hear them just like we do.
    Senator Specter. Mr. Secretary, you have two more complex 
questions pending. If you could give an encapsulated answer to 
each and perhaps supplement it in writing, I would appreciate 
it.

                     Block grants and local control

    Secretary Riley. All right, sir. The question of block 
grants generally, let me speak to that, because I think that is 
a very important issue and it touches two of the things that 
you mentioned.
    I do not think that we should be prescriptive, but I do 
think that we should in the Federal Government, as far as the 
Federal role is concerned--that it makes very good sense for us 
to set focused, targeted priorities that are broad and 
measurable. This idea of being measurable I think is very 
important. Is there accountability? How can you judge whether a 
program is getting better or worse, whether it is performing a 
function or not? Or are the programs' funds just being moved 
into the general budget of the State or of the local school 
district?
    So, that is my general feeling, that the Federal role is 
not control but it should provide funds that are focused and 
targeted but measurable. I think taxpayers deserve to know how 
their dollars are being spent, and the dollars that are taxed 
at this level, I think they should have a directed purpose, but 
the control of that should be as flexible as it could possibly 
be.
    As you know, we have pushed for that. We have eliminated 
two-thirds of the regulations in elementary and secondary 
education since we have been here, over 5 years, two-thirds of 
them. We have recommended Ed Flex which is now in 12 States, 
and the President, as you know, recommended to the Governors 
the other day that it be extended to 50 States. With Ed Flex, 
the State then could handle a waiver of a program, but it would 
not change the overall focus of the program and the 
accountability of the program.
    So, that is my general feeling. We do not think the general 
revenue proposals of time past were successful, and we think 
that special areas of concern, whether it is poor children or 
disabled children or whatever, do deserve attention.
    Let me say this about the States also. Over one-half the 
States now are in legal controversy stemming from 
constitutional issues over the equity funding formulas within 
the States. The idea of sending large numbers of block grant 
funds into a situation that is really up in the air in a lot of 
States--as to whether their entire financing process is based 
on equity--must be carefully considered. I think that is an 
important point.

                       GAO study on Block grants

    Then finally, the GAO study that just came out the last 
couple of days certainly indicates that if money goes down to 
the States and the States spend the money as they have in the 
past, it would cause the poor to be the losers. The people that 
we often target funds to on this level would be the losers.
    Those are some of my general answers on that.

                               Impact aid

    As you know, we favor funding part A programs and we have 
favored not funding part B programs, and that has been kind of 
an ongoing difference of opinion.

                   Special education budget increases

    IDEA gets into another whole matter of issues that I think 
are very, very important. As you know, in the last 2 years, we 
have had a 64-percent increase in IDEA, and that is very 
significant. I congratulate all of you for that and am pleased 
with it.
    If you look at a 64-percent increase in the last 2 years, 
this year we did not recommend an increase but level funding, 
but we do have $10 million in there for another 15 States to 
move forward with a State education reform strategy in terms of 
disabled children, and a $20 million increase for grants for 
the infants and families program.
    Then the main thing is that 80 percent of the special 
education children in America--80 percent of them--spend over 
40 percent of their time in regular classrooms. What we tried 
to do this year was to have a special emphasis on the regular 
classroom.
    The size of the classroom--if you reduce the pupil/teacher 
ratio in grades one, two, and three, and give those teachers 
special help in reading, it is amazing how that would help 
children who are borderline special education children. If they 
can have some special attention, individual attention from 
those teachers, many of them would not have to go into special 
education we think.
    So, we think title I, some of those other programs, the 
Eisenhower program, the reading program, the testing program--
all of those things that we recommend for the general regular 
classroom--we think will be tremendously helpful to disabled 
children.
    Senator Specter. Senator Kohl.
    Senator Kohl. Thank you very much.

                         After-school programs

    Mr. Riley, one part of the President's program that I am 
very interested in is the demonstration project run by these 
three Departments, the Education Department, HHS, and Justice, 
that will coordinate Federal after-school programs. I 
understand that the purpose of this initiative is to designate 
three to five pilots for these and to prove that you can do a 
better job by coordinating these programs, the after-school 
programs.
    How are you going do to this? How are you going to select 
the pilot cities? What are you looking for?
    Secretary Riley. Well, Senator, we strongly support, by the 
way, the work that they are going to be doing. I think it makes 
a whole lot of sense for us to coordinate those programs.
    I think there will be what? Three target areas?
    Mr. Skelly. Three to five cities will be selected as pilot 
projects.
    Secretary Riley. One, I think, in there will be Washington, 
DC, so that leaves several. Whether Milwaukee will be chosen 
would be dependent on what information we have and the criteria 
we establish. But Education, HHS, Labor, and Justice are among 
a number of different agencies that have pieces of after-school 
programs, and we very strongly support the program.
    You would like to see Milwaukee as one of the test cities. 
I will see that they have that for their consideration. I do 
not know if you have already written us to that effect. If not, 
please submit that. I know your superintendent, Allen Brown. If 
you would ask him to submit why he thinks that would be----
    Senator Kohl. I will do it.
    Secretary Riley. We certainly will see that that goes to 
the people.
    Senator Kohl. Thank you. One more question.

                   Bilingual and immigrant education

    In the school district of Wausau, WI, we have 22 percent 
Hmong and Laotian students. We have 45,000 Hmong and Laotian in 
Wisconsin. It is the second largest in the country, and they 
desperately need programs, such as bilingual and immigration 
education.
    Now, I know that you have an account for bilingual and 
immigration education, and the President's budget increases 
that account. Could I ask you to take a special look at the 
situation in Wausau, particularly the 25 percent of Hmong and 
Laotian students in Wisconsin, and in Wisconsin, where there 
are 45,000, the second largest concentration in the country? 
Can we see whether we could not provide some special assistance 
to that population?
    Secretary Riley. I certainly will do that. I have been 
there with you at one time and heard those concerns, and they 
are real. The Hmong children are refugee children, are they 
not?
    Senator Kohl. Yes.
    Secretary Riley. Are the Laotian refugee children too?
    Senator Kohl. Yes.
    Secretary Riley. And they are in a different situation than 
other immigrants certainly. They are in a preferred situation.
    We are meeting with HHS on that today in fact. We are 
having some meetings on it.
    Another very important program for them, of course, is 
title I. With the title I increases in here, and better 
targeting, title I really makes a big difference.
    But we are meeting with HHS to take a look at that 
situation, and I will try to get you some information on that.
    Senator Kohl. I do appreciate it, Secretary Riley.
    Secretary Riley. Thank you.
    Senator Kohl. Thank you, Mr. Chairman.

                     Additional committee questions

    Senator Specter. Thank you very much. Secretary Riley, 
there will be some additional questions which will be submitted 
for your response in the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                     Additional Committee Questions
 national test initiative--cost projections, participation, authority 
                             and oversight
    Question. How much of the fiscal year 1998 appropriations for the 
Fund for the Improvement of Education do you intend to use for 
development of national tests of 4th grade reading and 8th grade 
mathematics achievement?
    Answer. We are unsure at this time of the exact amount that will be 
needed in 1998 funds for the development of these national tests. We 
are awaiting a request from the National Assessment Governing Board, 
which now has exclusive control over the contract for development of 
the tests. Based on informal discussions with NAGB staff, we are 
expecting NAGB to request approximately $8 million in 1998 funding.
    Question. How much of the amount requested for fiscal year 1999 for 
the Fund for the Improvement of Education do you intend to use for 
future test development, field testing, etc., of the national tests, if 
you obtain authorization to continue this activity after the end of 
fiscal year 1998.
    Answer. Our current estimate, again based on informal discussions 
with NAGB staff, is that we will allot $13.5 million to NAGB in 1999 
for the test development contract.
    Question. What is your current position on authorization for 
national test development and implementation after the end of fiscal 
year 1998--do you believe that you have authority to proceed with this 
activity unless new restrictions are enacted, or do you believe that 
you need specific and explicit authority to continue with this activity 
beyond the actions and time period referred to in the fiscal year 1998 
appropriations act?
    Answer. We believe that we have authority, under the current 
authority for the Fund for the Improvement of Education, to proceed in 
1999 with the development and pilot testing of these voluntary national 
tests. Our proposed appropriations language would ensure that the 
National Assessment Governing Board continues to have exclusive 
authority and oversight with regard to the voluntary national tests. 
The NAGB schedule for the development of these tests calls for pilot 
testing in March of 1999 and field testing in March of 2000. Absent the 
enactment of new restrictions, funds provided to NAGB in 1999 would 
support item development and pilot testing. Funds provided in 1998 
cannot be used for pilot testing or field testing of the national 
tests.
    Question. How many States have committed themselves to participate 
in the national tests, should they ever be implemented?
    Answer. We no longer have a good count of the number of States 
committed to using these tests, given that the first administration of 
the tests is now scheduled for March of 2001.
    Question. Does the number of States agreeing to participate justify 
the planned level of expenditure for this activity?
    Answer. We believe that the costs of developing these tests is well 
justified. The annual cost of test development we estimate will be 
approximately $13 million. States and districts will bear the costs of 
administering the tests, which they will use on a voluntary basis. We 
expect that a large number of States, as well as many districts located 
in States that do not decide to use the tests on a statewide basis, 
will choose to use these tests when they become available in 2001.
    Question. Is there any reason why we should authorize any post-
fiscal year 1998 activity on the national tests before receiving the 
recommendations of the National Academy of Sciences on this initiative 
and such possible alternatives as linking scores pupils receive on 
current State and national tests?
    Answer. We believe that the national test development activities 
should continue pending receipt of these recommendations from the 
National Academy. We should not risk discontinuing these activities 
when the Academy could conclude that linking is not a viable 
alternative.
    Question. What changes in the national test development contracts 
and schedule have been made since oversight responsibility was shifted 
to the National Assessment Governing Board under the fiscal year 1998 
appropriations act?
    Answer. The National Assessment Governing Board is in the best 
position to respond with regard to changes in the contract. We do know 
that they have adopted a new schedule, which calls for pilot testing of 
potential test items in March of 1999 and field testing of alternative 
test booklets in March of 2000, with the tests first available for use 
in March of 2001. The Administration's original proposal was for the 
tests to be available for use in March of 1999.
        children's literacy initiative--america reads challenge
    Question. As you are aware, the $210 million provided in the 1998 
appropriation for the Children's Literacy Initiative is contingent on 
the enactment of authorizing legislation by July 1, 1998; without that 
enactment, the funds transfer to the Special Education account. Given 
the lack of Senate action thus far on new reading legislation, should 
we ignore your request for $50 million in additional funding for 
Children's Literacy, or assume those funds should be appropriated for 
Special Education as well?
    Answer. The Chairman of the Senate Labor and Human Resources 
Committee has indicated that he will push forward with a children's 
literacy initiative after the Congressional Easter recess. In fact, 
hearings on the literacy bill have been tentatively scheduled for April 
28, 1998. Therefore, we fully anticipate the passage of a children's 
literacy initiative by July 1, 1998, and stand by our request of $50 
million in additional funding.
   administration's position on the reading excellence act--h.r. 2614
    Question. Do you support the provisions of H.R. 2614, the Reading 
Excellence Act, as passed by the House last fall? Do you have any 
concerns about provisions of H.R. 2614?
    Answer. On November 7, 1997, the President's Office of Management 
and Budget issued a Statement of Administration Policy (SAP) on the 
Reading Excellence Act. Following is a verbatim repetition of the SAP.
    The Administration supports House passage of H.R. 2614 if the 
anticipated amendments are included in the bill. The bill is consistent 
with the objectives of the President's America Reads Challenge insofar 
as it: (1) provides tutoring assistance to children who need it; (2) 
promotes family literacy programs to help parents be their child's 
first teacher; and (3) improves teachers' ability to teach reading 
effectively.
    The Administration does have concerns that need to be addressed in 
the Senate. First, while some progress has been made on the issue of 
tutorial assistance grants, the separate authority for these grants in 
the House bill should be deleted or substantially modified. In their 
current form, these grants are inadequately connected to, and 
supportive of, in-school reading programs and the local reading grants 
that the bill would also authorize.
    Second, the Administration objects to the bill's new mandate on 
colleges participating in the work-study program. The current approach 
of providing incentives to colleges to use voluntarily more of their 
work-study funds for reading tutors is working well, and a new Federal 
mandate is not needed.
    Third, the Administration objects to the bill's failure to include 
schools funded or operated by the Bureau of Indian Affairs (BIA) in the 
local reading improvement subgrant provisions of the bill. The BIA 
educates a considerable number of preschoolers and elementary school 
children, many of whom live in the poorest counties in the Nation and 
are in need of reading instruction assistance.
    Additionally, the bill's provisions relating to the peer-review 
panel to be created under the bill should be revised to place the 
convening authority in the hands of the Secretary of Education, who 
administers this new program, in order to ensure accountability in the 
award of Federal funds.
    Finally, the Administration is concerned that many of the 
provisions in the bill remain overly prescriptive and may limit the 
flexibility of local educational agencies in designing their programs.
   title i and the agostini decision--impact on privateschool pupil 
                             participation
    Question. Since the Supreme Court ruled, in the 1997 Agostini 
decision, that Title I services may be provided to eligible private 
school pupils in their own schools, has there been a significant 
increase in the number of private school pupils served under this 
program?
    Answer. We need to give the decision some time to take effect 
before we can gauge the effects on private-school student participation 
in Title I.
    The Court reversed its 1985 decision in June 1997, which means that 
LEA's and schools began planning and implementing new instructional 
arrangements beginning with the current school year (1997-98). We plan 
to collect data on private-school students' participation in Title I 
about mid-way into the 1998-99 school year, as part of the National 
Assessment of Title I. Since the Court has now removed a significant 
obstacle in serving private school children, we expect that 
participation will increase significantly.
           title i capital expenses and the agostini decision
    Question. Should we continue to provide funds for Capital Expenses 
related to serving private school pupils under Title I?
    Answer. We believe that the 1999 Capital Expenses funds should be 
substantially less than the 1998 appropriation of $41 million, but that 
it may be prudent to retain a small amount of funding in the program 
for districts that have legitimate needs for these resources. Our $10 
million request for 1999 would provide a third and final year of phase-
out funding to districts that entered into long-term leases and other 
arrangements to comply with the Supreme Court's initial decision. In 
addition, school districts have use of the 1997 and 1998 Capital 
Expenses appropriations, totaling $82 million, to buy out leases, 
dispose of equipment, and make other less costly instructional 
arrangements to serve religious school students effectively.
    Since the new decision removes the legal necessity for school 
districts to maintain costly arrangements to serve religious school 
students at neutral sites, the need for Capital Expenses funds is 
already dropping, and the demand for funds can be expected to decline 
sharply by 1999. Data show that, in the fall of 1997 (only 3 months 
after the Felton reversal), 21 States turned back all or some of their 
funds to the Department, compared to 18 States the year before. Also, 5 
States requested additional funds, but 7 did the year before. The 
requests from New York and Pennsylvania, two of the States serving the 
largest numbers of private school children, both dropped by 40 percent 
from the previous year.
    Question. What has been the total amount spent for Capital Expenses 
related to serving private school pupils under Title I, under either 
Capital Expenses or general Part A funds, between the 1985 Aguilar 
decision and the reversal of Aguilar by Agostini in 1997?
    Answer. Before the Court's reversal of its 1985 decision on June 
23, 1997, the Congress provided $323 million in annual appropriations 
for the Capital Expenses program, which school districts used to create 
and maintain arrangements for providing Title I services to private-
school students off the premises of religious schools. We have no 
information on the amount of Title I, Part A funds, that were also used 
for this purpose. Under Title I, the extra administrative costs of 
providing equitable Title I services for private school children must 
be taken ``off the top'' of a district's Title I allocation.
    Question. How can we avoid such an expensive flip-flop of national 
policy toward serving private school pupils in the future?
    Answer. We do not expect the Supreme Court to change its position 
on this issue. The Court reached the common sense result of permitting 
Title I supplemental services to be moved out of vans into school 
classrooms, with appropriate safeguards to ensure there is no improper 
appearance of State endorsement of religion.
    The Administration argued for and strongly supports the Court's 
decision because it eliminates the legal necessity for costly and often 
less educationally effective alternative arrangements for providing 
Title I services to private school students. For more than 10 years, 
the Department, and State, local, and private school officials, 
struggled with the problems created by the 1985 decision. That decision 
made it much more difficult to provide Title I services to 
educationally disadvantaged religious school students, since those 
students had to leave their buildings in order to be served, and time 
was lost getting those children to and from Title I programs. It was 
hard to provide equitable access when instruction for public school 
children takes place in their school building, while private school 
students had to leave their schools in order to be served.
        updated census data and title i allocations to counties
    Question. Have you made a formal decision regarding use of census 
population update estimates for counties in the allocation of fiscal 
year 1998 appropriations for Title I?
    Answer. Yes. We were able to make a decision early this year, 
thanks to the splendid work by the Census Bureau and the Committee on 
National Statistics' Panel on Estimates of Poverty for Small Geographic 
Areas, convened under the auspices of the National Academy of Sciences.
    To give you some background, in making Title I allocations, the 
Department (by statute) is required to use the Census Bureau's updated 
poverty data at the county and school-district levels, unless the 
Secretaries of Education and Commerce determine that these data would 
be inappropriate or unreliable for this purpose. In making this 
determination, the Secretaries must consider the recommendations of the 
National Academy of Sciences.
    Between June and October 1997, the Census Bureau carried out 
extensive evaluations of its model for updating the number of school-
age children from low-income families in counties. On the basis of 
those evaluations, the Bureau revised its model and prepared a revised 
set of 1993 county estimates. After conducting a full assessment of the 
Census Bureau's work and its evaluation results, the Academy, in 
January 1998, published its findings and recommendations on the 
Bureau's model for producing updated county-level estimates of poor 
school-aged children. This report, entitled ``Interim Report 2, 
Evaluation of Revised 1993 County Estimates for Title I Allocations,'' 
concluded that the updated estimates are superior to those from the 
outdated 1990 census, and that the revised estimates should not be 
averaged with estimates from the 1990 census, as was done for last 
year's allocations.
    Secretary Daley and I have accepted the Academy's recommendations. 
The Department will allocate the 1998 Title I appropriation on the 
basis of the Census Bureau's updated county-level estimates.
        updated census data estimates for local school districts
    Question. Are you, the Census Bureau, and the National Academy of 
Sciences on schedule to produce and evaluate population updates for 
local school districts, as required under the Title I statute to be 
used in allocating fiscal year 1999 appropriations?
    Answer. While we have a workable schedule for producing and 
evaluating the Bureau's current approach for updating poverty 
estimates, both the Commerce and Education Departments continue to have 
major uncertainty about the feasibility of producing reliable estimates 
at the school-district level. As the National Academy of Sciences notes 
in its January 1998 report, creating poverty estimates at the local 
educational agency (LEA) level is far more complex than making 
estimates for counties, because of limitations in the data available 
for producing these estimates and because of the physical 
characteristics of school districts. For example, most districts are 
very small, most have boundaries that do not conform to any other 
boundary or administrative unit, and some districts overlap counties. 
Using the Census Bureau's model for updating county-level poverty 
estimates is not an option, since that model relied on data on food 
stamp recipients, income taxes, and population that do not exist at the 
school district level. In addition, Department staff believe that other 
problems, such as changes in school district boundaries and the 
unavailability of the required noncensus counts of children at the LEA 
level, may also hamper fiscal year 1999 implementation of LEA 
allocations.
    The current schedule calls for the Bureau to transmit its LEA-level 
estimates to the National Academy of Sciences for review and evaluation 
by October 1998. The Academy is required to issue a report 90 days 
later outlining its recommendations with regard to the use of the LEA 
data for fiscal year 1999 Title I allocations. Based on the Academy's 
recommendations, the Secretaries of Commerce and Education expect to be 
able to make a decision by January 1999 about whether to use the data 
for fiscal year 1999 Title I allocations.
    Question. What is your view of the reliability of the population 
update process at Census thus far?
    Answer. We agree with the National Academy of Sciences that the 
Census Bureau's process produced updated county poverty estimates that 
are demonstrably superior to estimates from the outdated 1990 census 
and that they are appropriate and reliable for making fiscal year 1998 
Title I allocations.
        impact of census updates on title i formula allocations
    Question. Why have the updates produced thus far appeared to be 
biased against certain high poverty parts of the Nation, such as 
several Southern states, and in favor of certain low poverty areas, 
such as many fast-growing suburban counties?
    Answer. The updates reflect large demographic shifts in poverty and 
population that took place between 1989 and 1993.
    Through the operation of the Title I formula, States and counties 
with above-average increases in their number of poor children gain 
funds, while States and counties with reductions in poor children (or 
increases lower than the national average increase of 28.2 percent) 
lose funds. Indeed, most States and counties that lose Title I funds do 
so because of below-average increases in poverty rather than actual 
decreases. High-poverty areas that receive reductions, using the 
updated estimates, in their Title I funds do so because they have a 
smaller proportion of the Nation's poor children compared to where they 
were four years earlier.
    High-poverty school districts will continue to receive larger 
allocations per poor child due to the Concentration Grant formula. In 
fact, the fairest and most effective way to increase targeting is by 
directing more funds through the Concentration and Targeted Grants 
formulas, not by using out-of-date poverty data. The President's budget 
request for fiscal year 1999 would direct almost all the increase ($391 
million) through these two formulas.
    High-poverty counties and school districts also receive protection 
through the statutory ``hold-harmless'' provision, which ensures that 
those with poverty rates of 30 percent or more receive at least 95 
percent of their prior year allocation.
 innovative education program strategies--goals 2000: educate america 
                        act and title vi of esea
    Question. For the fifth year in a row, the Administration is 
proposing termination of funding for the education block grant, the 
State grant program for Innovative Education Program Strategies 
authorized under Title VI of the Elementary and Secondary Education 
Act. How do you justify the elimination of one of the most flexible and 
popular forms of Federal assistance for elementary and secondary 
education?
    Answer. The Administration believes that the Title VI program is 
not well designed to support the types of State and local efforts that 
can result in real improvements in teaching and learning. Findings from 
the most recent evaluation of the former Chapter 2 program, Title VI's 
predecessor, suggest that programs that provide greater accountability, 
but offer the flexibility of Title VI, have a better chance of 
effecting real change in the classroom. For example, the evaluation 
found that program funds were used by fewer than half of the States to 
support reform efforts such as revising and developing standards for 
student performance, developing alternative measures of student 
achievement, or encouraging public-private partnerships. Districts were 
even less likely than States to use Chapter 2 funds to support 
education reform efforts. Although more than half of all districts 
reported some systemic reform efforts, fewer than one-fourth of them 
used Chapter 2 funds to support these activities.
    The Department believes that a more effective way to utilize scarce 
resources lies in targeting funds on comprehensive systemic reform and 
areas of high need. For example, programs under the Goals 2000: Educate 
America Act provide almost the same flexibility as Title VI, but make 
the critical link between expenditures and educational reform that 
Title VI does not. States are using Goals 2000 funds to establish 
challenging academic standards and to coordinate their curriculum 
frameworks, student assessment programs, and other aspects of their 
educational systems to help children achieve to the State standards.
    States distribute at least 90 percent of their Goals 2000 funds 
directly to local educational agencies (LEA's) for local reform, the 
improvement of preservice teacher education programs, and professional 
development. At least half of the money for local reform goes to LEA's 
that have a greater percentage or number of disadvantaged children than 
the statewide average. LEA's must ensure that at least 75 percent of 
their first-year money and at least 85 percent of subsequent years' 
funds go to individual schools so that schools can tailor their own 
improvement plans to help students meet the State or local standards.
                  evaluation of title vi, esea program
    Question. The education block grant program appears to achieve its 
popularity through being one of the few sources of funds that can be 
used for educational improvement purposes as determined by local 
educational agencies. For what school year did you last conduct an 
evaluation of the accomplishments of this program at the local level?
    Answer. The 1994 evaluation of Chapter 2, ``How Chapter 2 Operates 
at the Federal, State, and Local Levels,'' which collected data in the 
1991-1992 school year, is the most recent evaluation of the program. 
Several findings from the evaluation have prompted the Administration 
to question the effectiveness of the Title VI program. For example, the 
evaluation found that LEA's tended to concentrate their Chapter 2 
expenditures on instructional materials rather than educational reform 
activities. In addition, States and LEA's sometimes used Chapter 2 
funds for activities and programs that were not directly related to 
classroom instruction; for example, LEA's often purchased equipment for 
administrative use, and SEA's also used Chapter 2 funds for various 
administrative activities. The evaluation also found that the majority 
of activities supported by Chapter 2 funds would have continued without 
Chapter 2, because these funds typically constituted a small percentage 
of any program's funding.
    The 1994 evaluation determined that, because States had a wide 
latitude in how they conducted their self-evaluations for effectiveness 
and in how they used accountability mechanisms for LEA's to access 
compliance with Federal and State regulations and fiscal matters, there 
was a problem across Chapter 2 programs regarding the lack of good 
evaluations. Almost one-fourth of LEA's conducted no evaluations of 
their Chapter 2 activities, and those that did tended to collect 
informal feedback or anecdotal evidence about program outcomes.
    The Department has not followed up the 1994 study with another 
stand-alone evaluation of Title VI. This course of action has seemed 
wise, given limited evaluation resources, because the 1994 
reauthorization did not make significant changes to the statute, and 
there is little reason to believe that State and local program 
practices have changed since the early 1990's. However, the Department 
will collect data on the uses of funds under Title VI (as well as 
Titles I, II, III, IV, and Goals 2000) through the forthcoming 
``Targeting and Resource Allocation Study.'' This study should be 
completed in early 1999.
             program evaluations and innovation priorities
    Question. Do your program evaluations show the extent to which 
local schools have any other source of funds to meet locally determined 
improvement and innovation priorities?
    Answer. Goals 2000 provides assistance for States to develop their 
own strategies for comprehensive reform of elementary and secondary 
education. With the help of Goals 2000, States are establishing 
academic standards and coordinating their curriculum frameworks, 
student assessment programs, teacher preparation and licensure 
requirements, parental and community involvement activities, and other 
aspects of their education system to help children achieve the State 
standards. As mentioned above, States must distribute at least 90 
percent of their Goals 2000 funds directly to LEA's, and at least 75 
percent of the LEA's' first-year money and at least 85 percent of 
subsequent years' funds go to individual schools so the schools can 
tailor their own improvement plans to help students meet the State or 
local standards.
    In addition, beginning in 1995, more schools became eligible to 
operate schoolwide programs, which allow high-poverty schools to use 
Title I funds, in combination with other Federal, State, and local 
funds, to improve the overall instructional program for all children in 
a school. About 25,000 schools receiving Title I funds are now eligible 
to implement the schoolwide approach, compared to about 10,400 under 
the previous law.
    Finally, Congress appropriated $120 million to support 
comprehensive reform in schools eligible for Title I funds in fiscal 
year 1998. An additional $25 million is available to all public 
schools, including those eligible for Title I. The Comprehensive School 
Reform Demonstration program (CSRD) is focused on assisting schoolwide 
changes in schools where there is the greatest need to substantially 
improve student achievement. CSRD funds are intended to help schools 
improve their entire educational operation through curriculum changes, 
sustained professional development, enhanced involvement of parents, 
and other reforms, based on a careful identification of local needs.
   block grants and other federal regulatory and paperwork reduction 
                                efforts
    Question. The education block grant program has reduced Federal 
regulatory and paperwork burdens to a minimum. Have you considered 
modifying other Federal education programs to be more like it, rather 
than proposing block grant termination?
    Answer. In addition to the programs mentioned above, which provide 
considerable flexibility to States and LEA's, the Department offers 
other means to keep paperwork and regulatory burdens to a minimum, 
including the Education Flexibility Partnership Demonstration Program 
(Ed-Flex) and the waiver authorities under the Elementary and Secondary 
Education Act, the Carl D. Perkins Vocational and Applied Technology 
Act, and Goals 2000.
    Question. As you can see last year from the Senate passage of the 
Gorton amendment to the 1998 appropriations that would have created a 
$13.4 billion elementary and secondary education block grant, the 
Congress continues to give considerable support for reducing the number 
of education programs, and reducing the administrative and paperwork 
burdens associated with such programs. What steps are you taking that 
might increase State and local flexibility while streamlining the 
administrative procedures connected with the current array of Federal 
education programs?
    Answer. In addition to the programs and activities that provide 
State and local flexibility mentioned above, Goals 2000 allows the 
Secretary the authority to: (1) waive certain Federal regulatory and 
statutory provisions that may impede State or local reform efforts; (2) 
delegate up to 12 States the authority to waive these provisions 
without having to secure additional Federal approval through Ed-Flex; 
and (3) distribute Goals 2000 funds directly, on a competitive basis, 
to LEA's in States that choose not to participate in Goals 2000.
    The Department has worked hard to ensure that States and LEA's can 
benefit fully from these authorities. For example, the Department has 
granted Ed-Flex status to 12 States and will seek congressional 
approval to expand the authority so that all States are eligible. In 
addition to Goals 2000, the Department can grant waivers under the Carl 
D. Perkins Vocational and Applied Technology Act and the Elementary and 
Secondary Education Act, including most of the requirements of major 
Federal education programs such as Title I, Even Start, Eisenhower 
Professional Development, and Safe and Drug-Free Schools. To date, the 
Department's Waiver Board has granted over 200 waivers to States and 
LEA's to provide increased flexibility in exchange for increased 
accountability for raising student achievement. This flexibility allows 
States and LEA's to address local needs with locally designed 
solutions. Finally, only two States, Oklahoma and Montana, have chosen 
not to participate in Goals 2000, and the Department will award grants 
to LEA's in those States in early summer, following a competition.
    In its program reauthorization proposals, the Department has 
proposed statutory revisions to increase State and local flexibility 
and reduce administrative overhead. For example, our vocational 
education proposal would eliminate numerous set-asides and provide 
States with flexibility by eliminating many requirements and providing 
for Federal waivers. For the reauthorization of the Adult Education 
Act, the Department has proposed to streamline numerous existing 
authorizations and provide States with flexibility provisions similar 
to those in our vocational education proposal. The Department will look 
for similar opportunities in the Elementary and Secondary Education 
Act, which comes up for reauthorization next year.
           funds used for classroom and administrative costs
    Question. One of the issues frequently heard in support of 
education block grants is that too great a portion of each Federal 
program dollar never reaches the actual classroom. Do you have any data 
showing the allocation between classroom and non-classroom uses of 
funds under the major elementary and secondary education programs 
administered by the Department?
    Answer. The Department recently prepared a report, The Use of 
Federal Education Funds for Administrative Costs, that provides the 
most up-to-date information about the amount of Federal elementary and 
secondary funds that are used by States and LEA's for classroom 
instruction, instructional materials, and other programs and services 
that benefit teachers and students directly, and the extent to which 
those funds are used for administrative purposes. The report summarizes 
data obtained from several sources, including: (1) the GEPA 424 report, 
a Department of Education data collection report with information on 
the distribution of Federal funds for a wide range of Federal programs 
supporting elementary and secondary education for fiscal year 1995; (2) 
data from a Coopers & Lybrand Financial Analysis Model provided by 
Milwaukee, by South Carolina for 33 of its school districts, and by 
Rhode Island for seven of its districts, as well as published data for 
13 other school districts for earlier school years; and (3) GAO 
reports.
    Major findings include the following:
  --For programs under the Elementary and Secondary Education Act, the 
        percent retained at the State level is about 2 percent; for 
        Title I, the percent is 1 percent.
  --In general, States retain substantially less money at the State 
        level than is permitted by law. For example, in fiscal year 
        1995, States were permitted to retain up to 20 percent of Title 
        VI (Chapter 2) money, but only retained 9 percent in actual 
        practice.
  --At the local level, about four-fifths of Title I funds are used for 
        instruction, with additional funds used for supporting 
        activities, such as professional development, curriculum 
        development, counseling, and other activities that have a 
        direct impact on teachers and students. Local administrative 
        expenses appear to range from 4 to 13 percent of local 
        expenses, depending on the location and the data base 
        considered.
  --Across all Federal elementary and secondary programs, instruction 
        and instructional support account for 88 percent of local 
        expenditures.
    Question. To what extent do the non-classroom uses of Federal 
education dollars meet important national education objectives?
    Answer. States and LEA's use Federal funds to support a range of 
non-classroom activities that directly support instruction, including 
the development and implementation of standards and assessments, 
professional development, curriculum development, parent and community 
involvement programs, and technical assistance.
         class size reduction and teacher financing initiative
    Question. Why would the proposed Class Size Reduction initiative be 
funded through mandatory budget authority?
    Answer. The initiative is proposed for mandatory funding because it 
is intended to be funded through tobacco settlement revenue. In 
addition, the Administration believes that the annual discretionary 
appropriations process would not provide districts with the necessary 
certainty that funds will be available, and that the program requires 
the firm commitment provided through a mandatory appropriation.
    Question. For school districts who hire new teachers with funding 
from the proposed Class Size Reduction initiative, there are 
potentially significant long-term financial costs as these teachers 
gain experience and further training, and move up their respective pay 
scales. Does the Administration intend that the Class Size Reduction 
initiative continue beyond the 7-year time period cited in the budget 
request in order to assure participating districts that the burden of 
those long-term costs does not fall solely upon them?
    Answer. Yes, the Department does intend for the Class Size 
Reduction initiative to continue beyond the 7-year time period. The 
initiative is to be financed through revenues from a tobacco 
settlement, and any settlement is likely to provide revenues for at 
least 25 years.
    Question. Why are States' average class sizes in grades 1 through 3 
not used at all in determining State shares of funds under the Class 
Size Reduction initiative?
    Answer. The Title I formula allows funds to be targeted to the 
States with the highest levels of poverty and the greatest financial 
need. For within-State allocations, States would be required to 
distribute funds based on each local educational agencies class sizes 
and their relative ability and effort to finance class-size reductions 
with their own resources.
              achievement gains from class size reductions
    Question. The proposed Class Size Reduction is intended to reduce 
the average class nationwide in grades 1 through 3 from 22 students to 
18 students. How do you respond to critics who state that a reduction 
of this size is not sufficient to generate student achievement gains 
commensurate with the cost of the initiative?
    Answer. Two recent research studies have found that smaller classes 
can mean higher levels of student achievement, at least through the 
elementary school grades, particularly for minority, poor, and inner-
city children.
    One study examined the results on the 1992 National Assessment of 
Educational Progress (NAEP) mathematics assessment for 10,000 fourth- 
and eighth-graders. The study found that students in small classes, 
those classes with fewer than 20 students, performed better than 
students in large classes for both grade levels, even taking into 
account student demographics, overall resource levels, and the cost of 
living.
    Studies of the Tennessee Student-Teacher Achievement Ratio (STAR) 
project have also found that students in small classes performed better 
than students in large classes in each grade from kindergarten through 
third, and that the achievement benefits persisted through at least the 
eighth grade. The same benefits from small classes were found for boys 
and girls alike. While all types of school districts--inner-city, 
urban, suburban, and rural--realized significant gains from small 
classes, the gains were greatest for minority and inner-city students 
in each grade. Further analyses of the results have found that students 
in small classes are less disruptive and less likely to be retained 
than their peers in larger classes.
    One of the biggest advantages to reduced class sizes is that it 
provides teachers with an opportunity to better gauge their students' 
strengths and weaknesses and get to know them as individuals. Research 
verifies this by demonstrating that classroom structures that allow 
teachers to know students and their families well are associated with 
increased achievement, more positive feelings toward school, and more 
positive behavior.
    In addition, reduced class size allows teachers to work more 
closely with their students and, as a result, they are better able to 
identify students with learning disabilities. Potentially, early 
identification of, and remediation for, children with learning 
disabilities can reduce the need for special education services in the 
later grades and eliminate, or substantially reduce, the costs 
associated with such services.
       size reduction and other strategies to improve achievement
    Question. Are there other kinds of improvement strategies that 
promise as much or more achievement gain, but at a lower cost?
    Answer. The Department believes that reducing average class sizes 
in grades 1 through 3 is an essential component of any strategy to 
raise the educational achievement of all students. Rigorous research 
has shown the benefits of small classes for all children, but 
particularly for minority and inner-city students. If the benefits of 
small classes are to be fully realized, this strategy must be a part of 
comprehensive educational reforms.
    In order for the benefits of small classes to be fully realized 
children cannot simply be placed in smaller classes, but must also be: 
expected to achieve to challenging content and performance standards, 
and have their progress measured by tests aligned to those standards; 
attend schools that are able to recruit and retain a qualified teaching 
staff; and taught in environments conducive to high achievement.
                21st century community learning centers
    Question. The Administration's fiscal year 1999 budget request of 
$200 million for 21st Century Community Learning Centers represents a 
400 percent increase above the fiscal year 1998 appropriation. At the 
proposed level, the program would support extended-day activities in 
approximately 4,000 schools serving up to half a million school 
children. What evaluations and program outcomes justify such an 
increase?
    Answer. The importance of these programs has been demonstrated 
through various studies, including FBI statistics that show the 
greatest rates of crime and violence to be between the hours of 2 to 8 
p.m. Additionally, research clearly shows that positive and sustained 
interactions with adults contribute to the overall development of young 
people and their achievement in school. Research also indicates that in 
high-quality programs--where student to staff ratios are low, staff are 
well-trained, and a wide variety of activities are offered--students 
have more positive interactions with staff, better peer relations, and 
better grades and conduct in school than their peers in other care 
arrangements. These outcomes are particularly beneficial for 
disadvantaged or low-achieving students, who typically lack resources 
such as technology and outside tutoring.
    The six current 21st Century Community Learning Centers projects, 
now in their final year, have successfully established community 
centers offering important services to students, families, and low-
income adults, provided through the development of partnerships between 
schools and local agencies, organizations, businesses, and colleges. 
Because the projects are completing their final year of funding, the 
Department will not have specific outcome data until the final reports 
are received. However, we do have information on what each project has 
accomplished thus far.
    For example, the Clinton County 21st Century Community Learning 
Center created a GED program for high-school drop-outs. Its initial 
goal was to enroll 20 students; ultimately it enrolled 72 students. 
During its second year, the project expanded to include distance 
learning and technology classes for 150 participants. The Center also 
served over 100 individuals in professional development and continuing 
education courses. This project involved such community groups as the 
Western Kentucky University, the Bank of Clinton County, Berea College, 
and the Department of Social Services.
    Another project administered by the Chicago Public Schools involved 
37 school principals, in conjunction with parents, community 
organizations, municipal service providers and local agencies. 
Together, these groups established literacy, GED, and tutoring 
programs, as well as workshops on computer skills, nutrition, and 
parenting. A series of Saturday sessions promoted family involvement by 
providing instruction to both parents and children together.
                 after-school centers a federal concern
    Question. Why should a program of after-school services become a 
Federal rather than State or local concern?
    Answer. It has become a Federal concern because of the demonstrated 
need for these centers in communities across the Nation and the 
potential of these centers to improve achievement and safety in 
schools. Recent studies estimate that 5 million children are left 
unsupervised after school. The requested funds would provide services 
for only a percentage of these children. The majority of schools do not 
currently have such programs. The most recent survey from the National 
Center for Education Statistics (NCES) revealed that in 1993-94, 30 
percent of all public elementary schools had centers. In urban areas, 
more than 40 percent of schools had centers, and in rural areas, only 
18 percent. Availability in high-poverty schools was similar to that of 
low-poverty schools, but high-poverty schools showed greater 
participation rates.
    This year, over 5,000 people attended the information sessions on 
the 1998 competition that were sponsored by the C.S. Mott Foundation. 
The Department received nearly 2,000 applications, and many more 
requests for applications and information.
            administration of 21st century learning centers
    Question. Why should the Department of Education administer this 
program rather than the Department of Health and Human Services (HHS)?
    Answer. This question was carefully considered by the 
Administration before submitting its request. The Department of 
Education is administering this program because this enables us to 
emphasize educational services and the use of schools as community 
centers.
    HHS currently administers the Child Care and Development Block 
Grant (CCDBG) which provides, through the States, direct support to 
low-income parents to help them pay for child care; it also provides 
funding to providers of after-school programs to subsidize the 
participation of children from poor families. As a complement to the 
CCDBG focus on meeting demand by helping poor parents pay for child 
care, the 21st Century Community Learning Centers addresses the supply 
issue by providing seed money to establish or expand programs that 
utilize public school buildings cost-effectively to serve school-age 
children.
    School-based programs also providealong with recreational and 
nutritional programsunique opportunities to link out-of-school learning 
activities with the core curriculum, providing advancement, enrichment 
or extra help that can make a difference in each student's academic 
success. Schools are convenient and accessible to students and parents 
and have much of the resources needed for such programs. Also, school-
based centers can result in increased community and parent involvement 
in the school. Yet, despite high demand from parents and overwhelming 
support from educators for school-based programs, the majority of the 
Nation's elementary and middle schools still do not offer after-school 
programs.
                  education opportunity zones proposal
    Question. Why do you propose another new program targeted at high-
poverty areas when we already have not only the Title I, Elementary and 
Secondary Education Act program but also the new Comprehensive School 
Reform program initiated in the fiscal year 1998 appropriations act?
    Answer. The Education Opportunities Zones program would differ in 
emphasis from both Title I and the Comprehensive School Reform 
Demonstrations. While Title I and the Comprehensive School Reform 
Demonstrations focus on improving achievement at individual schools, 
the Education Opportunity Zones program would emphasize implementation 
of policies that improve student achievement district-wide. These 
programs would be complementary, and all three would focus on assisting 
students to achieve to high standards.
    The Education Opportunity Zones program would distribute 
comparatively large grants to a limited number of competitively 
selected, high-poverty urban and rural school districts. To be eligible 
for a grant, the district would have to demonstrate that it had already 
begun to implement educational reforms and raise student achievement, 
at least in some schools. The purpose of the program would be to 
demonstrate that districts that expect all students to achieve to high 
standards and hold students, teachers, and schools accountable for 
achieving to those standards, can help raise achievement across an 
entire district.
    The Comprehensive School Reform Demonstration program provides 
funds by formula to States which then distribute the funds 
competitively to districts on behalf of individual schools. The program 
focuses exclusively on comprehensive school-level reform programs that 
have a strong research basis and have been successfully replicated. The 
program can help bring together Title I schoolwide funds, and other 
Federal, State, local, and private resources to support an integrated 
strategy to enable all children in a school to reach challenging 
academic standards. Comprehensive School Reform funds can help schools 
in Education Opportunity Zones implement proven models of reform, and 
can provide additional resources for Education Opportunity Zones to use 
for turning around failing schools.
             unique features of education opportunity zones
    Question. What would be the unique contribution of the Education 
Opportunity Zones initiative?
    Answer. The Education Opportunity Zones initiative would have a 
focus on district-wide reforms, rather than the focus on school-level 
reform efforts contained in Title I and the Comprehensive School Reform 
Demonstrations. The Zones initiative would differ from other programs 
in that it would provide support only to high-poverty urban and rural 
school districts that have already begun to implement accountability-
based, comprehensive educational reform policies, and have begun to 
show significant improvement, in at least some of their schools, in the 
educational achievement of all students. The grants would enable 
selected districts to expand the scope and accelerate the pace of their 
reforms, so that they can achieve, in more schools, the kinds of 
successes realized in some schools in these districts. Districts could 
use their funds for such activities as: (1) implementing a school-
performance-information system to measure the performance of schools in 
educating their students to high standards; (2) increasing public 
school choice through such strategies as open enrollment policies or 
charter schools; or (3) improving teaching through the development of a 
system for identifying ineffective teachers, providing them with 
assistance to improve their performance, and removing those teachers 
whose performance does not improve.
    Question. Why should we not focus on expanding and improving the 
existing programs aimed at the same problems?
    Answer. The Administration has requested funds to expand current 
programs like Title I, Goals 2000, and the Comprehensive School Reform 
Demonstrations. However, for the reasons outlined above, we believe the 
Education Opportunity Zones program will address a unique and difficult 
mission, and strongly support its enactment and funding as well.
    Question. When do you anticipate that legislative language for this 
proposal might be transmitted to the Congress?
    Answer. The Secretary transmitted the Education Opportunity Zones 
proposal to Congress on March 3, 1998.
       california ballot initiative ``english for the children''
    Question. A State ballot initiative entitled ``English for the 
Children'' will go before California voters in June 1998. The 
initiative would significantly alter instructional services for limited 
English proficient (LEP) children in California elementary and 
secondary schools. Among other things, the initiative calls for 
programs of sheltered English immersion as the primary means to teach 
English to LEP students. Would there be any conflict between the 
initiative, if enacted, and Federal civil rights laws enforced by the 
Department of Education?
    Answer. The Departments of Education and Justice are currently 
reviewing the language of the ``English for the Children'' initiative 
to determine if it would conflict with civil rights law. We are not yet 
ready to make a judgement on this issue, but expect to be able to do so 
in the near future.
    Question. Could sheltered English immersion programs as specified 
in the initiative qualify for assistance under the Bilingual Education 
Act?
    Answer. A significant number of the projects funded under the 
Bilingual Education Act employ instructional methods that use only 
English. At first glance, it seems likely that such projects would not 
conflict with the ``English for the Children'' ballot initiative, 
although the one-year timeframe specified in the initiative could be a 
problem.
   ensuring english language acquisition through bilingual education
    Question. Public Law 105-78, the Departments of Labor, Health and 
Human Services, and Education and Related Agencies Appropriations Act, 
1998, includes a requirement that the Department of Education only 
support Bilingual Education Act instructional services grants that 
``ensure that students completely master English in a timely fashion (a 
period of 3 to 5 years) while meeting rigorous achievement standards in 
the academic content areas.'' (111 Stat. 1500) How is the Department of 
Education implementing this requirement in the grant-making process?
    Answer. This language, which was first included in the fiscal year 
1996 appropriations act, reinforces language in the authorizing 
statute. The authorization makes it clear that helping limited English 
proficient students learn English and meet challenging State academic 
standards is the primary goal of all bilingual education projects 
funded under the statute. While the authorizing statute does not 
include a specific time frame for these goals, the appropriations 
language is fully consistent with the language in the statute.
    Applications for new awards are rated by outside peer reviewers who 
are given training in how to rank applications in accord with statutory 
and Departmental requirements. Departmental officials brief the 
reviewers on the statutory requirements for these projects, and on each 
of the published selection criteria. One of the criteria is ``quality 
of the project design'' and another is ``proficiency in English and 
another language.''
    Once the peer reviewers complete their ratings, staff from the 
Office of Bilingual Education and Minority Languages Affairs review the 
applications to make sure that they comply with statutory requirements, 
including that they are designed to ensure that students completely 
master English in a timely fashion (a period of 3 to 5 years) while 
meeting rigorous achievement standards in the academic content areas.
    The statute requires grantees to submit evaluations every two 
years. These evaluations must include information on the progress of 
students served by the program in attaining English proficiency.
                      year 2000 computer concerns
    Question. There has been lots of public speculation that many 
computer systems, including mainframes and desktops and many of the 
software programs as well, will become unworkable on January 1, 2000. 
What are the major uses of computers within the Department, both for 
management activities and program operations?
    Answer. The Department uses mainframes and desktops for many of its 
management activities and program operations. Computers are used to 
operate the Department's delivery systems dealing with student 
financial aid and Impact Aid programs, to foster communications 
internally and externally through the Internet and e-mail, and to 
operate the Department's accounting system. Many of these systems have 
been identified as mission- critical for Year 2000 purposes.
Mission-critical department computer systems
    Following is a list of the 14 mission-critical systems along with a 
description of each system's purpose:
  --Campus-Based Program System--receives summary data from 
        participating schools, determines institutional awards, 
        allocates funds and reconciles institutional accounts.
  --Central Processing System--confirms applicants' eligibility for 
        Federal student financial assistance.
  --Direct Loan Central Database--functions as the central repository 
        for summary-level data on Federal Direct Loan Program (FDLP) 
        loans, including aggregated financial data reported from the 
        FDLP servicer(s).
  --Direct Loan Origination System--supports FDLP loan origination to 
        book loans, reconciles with schools, and receives disbursement 
        information from schools as each loan is disbursed to a 
        recipient.
  --Direct Loan Servicing System--services FDLP loans while the 
        borrower is in school, in deferment status, or in repayment.
  --Federal Family Education Loan System--pays interest and special 
        allowances to lenders.
  --Multiple Data Entry System--receives paper applications for Federal 
        student financial assistance.
  --National Student Loan Data System--functions as a national database 
        of loan/grant-level data on the Title IV programs. Among its 
        many purposes, it is used to prescreen Title IV applicants for 
        eligibility.
  --Pell Grant Recipient Financial Management System--supports delivery 
        of aid under the Federal Pell Grant program.
  --Postsecondary Education Participants System--maintains data on 
        school participation. These data include eligibility, 
        certification, and program participation information.
  --Title IV Wide Area Network (TIVWAN)--a value-added network that 
        functions as a participant management system through which 
        users indicate which services they want to use from the systems 
        TIVWAN supports.
  --Education Central Administrative Processing System--(EDCAPS) the 
        redesign of the Department's core financial functions, work 
        processes and procedures. (This system is Year 2000 compliant.)
  --Education Central Network--the Department's hardware/software 
        infrastructure.
  --Impact Aid System--receives summary data from participating school 
        districts, determines awards, allocates funds and reconciles 
        school district accounts.
 gao plan for minimizing or eliminating the year 2000 computer problem
    Question. What steps has the Department taken to eliminate or 
minimize the ``Year 2000'' computer problem from these activities and 
operations, and, how much additional work, if any, remains to be done?
    Answer. The Department follows the five-phase approach recommended 
by the General Accounting Office and the Office of Management and 
Budget. The five phases are: awareness, assessment, renovation, 
validation and implementation.
    The awareness phase is an ongoing activity to help the Department's 
customers inside and outside the Federal government and the education 
community understand the scope of the Year 2000 problem. During this 
phase, customers are advised of the steps needed to be taken to ensure 
that their systems are Year 2000 compliant.
    The assessment phase, completed in February 1998, resulted in an 
inventory of the information technology systems used at the Department, 
the classification of each system by criticality, and the determination 
of the appropriate compliance strategy or disposition for each system. 
Criticality, expressed as ``mission-critical'' (most critical), 
``mission-important'' and ``mission-supportive'' (least critical) 
indicates which of the Department's systems are most essential to its 
functions.
    The dispositions determined from the assessment phase--compliance, 
repair, replacement or retirement--form the basis of the renovation 
phase. A system determined to be compliant can skip to the validation 
phase. If a system needs repair, modifications are scheduled to bring 
it into compliance. If a system needs to be replaced, a new compliant 
system will be developed to serve its function. Finally, a system will 
be retired if its functions can be eliminated or assumed by another 
system that is compliant.
    During the validation phase, compliant systems and those with 
completed renovations are tested to prove compliance. An independent 
third party will verify and validate each of the mission-critical and 
high risk mission-important systems.
    The implementation phase will assure that all data exchange 
agreements are in place and that non-compliant systems are replaced 
with the renovated compliant systems. This phase requires a relatively 
short period of time compared to the others.
    Currently, the assessment phase is complete, renovations are in 
process for non-compliant systems, and validations are in process for 
compliant and renovated systems. Several systems have been validated 
and implemented. Overall there are 14 mission-critical, 30 mission-
important, and 144 mission-supportive systems at the Department, most 
of which will require additional renovation, validation and 
implementation efforts.
              contracted departmental computer activities
    Question. What major computerized activities does the Department 
have under contract?
    Answer. All of the Department's mission-critical computer systems 
are under contract. They include the following: Campus-Based Program 
System; Central Processing System; Direct Loan Central Database; Direct 
Loan Origination System; Direct Loan Servicing System; Federal Family 
Education Loan System; Multiple Data Entry System; National Student 
Loan Data System; Pell Grant Recipient Financial Management System; 
Postsecondary Education Participants System; Title IV Wide Area 
Network; Education Central Administrative Processing System; Education 
Central Network; and Impact Aid System.
    In addition, a number of mission-important systems are under 
contract. An example of a mission-important system is the Department's 
payroll processing system, maintained by the Department of the 
Interior.
    ensuring year 2000 compliant systems for departmental programs 
                     dependent on computer systems
    Question. Which major programs, such as the National Assessment of 
Educational Progress, are heavily dependent on computers?
    Answer. The programs most dependent on computers in the Department 
include those that are directly supported by one or more of its 
mission-critical systems. These programs are the Federal Family 
Education Loan Program, the William D. Ford Direct Loan Program, the 
Pell Grant Program, Campus Based programs and the Impact Aid Program. 
In addition, all programs within the National Center for Educational 
Statistics (NCES), including the National Assessment of Educational 
Progress depend on computer processing due to the large amount of data 
that needs to be analyzed. Please note, however, that in addition to 
validation procedures, none of the computer programs used to support 
NCES perform date calculations.
    Question. What steps have you taken to ensure that these various 
contracted systems will survive the ``Year 2000'' problem?
    Answer. To ensure that the Department's systems operated by 
contractors will be Year 2000 compliant, each step of the renovation 
and validation phases of the project is closely monitored and tracked 
by the Department's Year 2000 staff and experts from the firm of Booz-
Allen and Hamilton. Status reports on each system are provided to the 
Year 2000 Steering Committee on a weekly basis. The Steering Committee 
is chaired by the Deputy Secretary, and includes the Chief Financial 
and Chief Information Officer and senior executives from program and 
staff offices responsible for major systems and Year 2000 renovations.
    As each mission-critical system is renovated, a qualified third 
party will conduct an independent verification and validation (IV&V) on 
the system to confirm that it is Year 2000 compliant. Results of each 
IV and V analysis will be reported to the Steering Committee.
    In addition, the Department is developing contingency plans for 
each mission-critical system. These plans will provide for continued 
delivery of services in the event of a system failure.
         year 2000 departmental outreach efforts to the states
    Question. What steps have you taken to find out what education 
activities at the State level are dependent on computerized activities?
    Answer. The Department is conducting an inventory of all of its 
data exchanges with the States. Once the inventory is completed, the 
Department will provide States with points of contact and any new data 
formats to ensure that all future data exchanges are Year 2000 
compliant.
    Numerous written communications have been made with the 
Department's data exchange partners and customers regarding Year 2000. 
For example, in January 1998, the Deputy Secretary and the Executive 
Director of the Council of Chief State School Officers sent a Dear 
Colleague Letter to the Chief and Deputy Chief State School Officers in 
the 50 States, the District of Columbia, and the territories. In the 
same month, the Deputy Assistant Secretary for Student Financial 
Assistance sent a Dear Colleague Letter to the 7,000 postsecondary 
education institutions participating in the Department's student aid 
programs.
    The Year 2000 Project Management Team has made telephone contact 
with several State Year 2000 coordinators and various constituent 
groups, including the Council of Great City Schools and the District of 
Columbia School System.
Year 2000 outreach efforts
    Examples of other Year 2000 outreach efforts that have been 
conducted include:
  --In July 1997, the Department briefed the National Association of 
        Student Financial Aid Administrators on the need to address the 
        Year 2000 issue;
  --In October 1997, the Deputy Assistant Secretary for Student 
        Financial Assistance programs sent a Dear Colleague Letter to 
        all State and private college and university presidents and 
        financial aid administrators that included a clear message 
        about Year 2000 compliance;
  --In December 1997, the Department briefed the National Council of 
        Higher Education Loan Programs on Year 2000 issues. The Council 
        includes representatives from the lending and guaranty agency 
        community, secondary markets, and third party servicers;
  --In December 1997, the Assistant Secretary for Special Education and 
        Rehabilitative Services sent a Dear Colleague Letter on Year 
        2000 issues to all National Institute on Disability and 
        Rehabilitation Research grantees, Special Education Program 
        Resource Centers, and Rehabilitation Services Administration 
        Independent Living Centers;
  --In January 1998, the Department met with the National Association 
        of College and University Business Officers to discuss Year 
        2000 issues;
  --In February 1998, a Dear Colleague letter was sent to all State 
        higher education executive officers from the Assistant 
        Secretary for Postsecondary Education and the Executive 
        Director of the State Higher Education Executive Officers;
  --In March 1998, a Dear Colleague Letter was sent to each of the 36 
        State and private non-profit guaranty agencies participating in 
        the Federal Family Education Loan Program; and
  --In March 1998, a Dear Colleague Letter from the Deputy Assistant 
        Secretary for Postsecondary Education was sent to the 
        approximately 7,000 lenders in the Federal Family Education 
        Loan Program.
    Over the weeks ahead, Department officials will continue to 
participate in education association meetings and conferences, issue 
Dear Colleague Letters, and use the electronic media to contact and 
consult with the education community on Year 2000.
    The Department also works with over 30 boards, commissions, 
councils, and independent agencies that serve the education community. 
To ensure that all of these organizations develop a Year 2000 
compliance strategy, principal office coordinators are consulting 
closely with their constituent entities. In addition, the Department's 
Office of Intergovernmental and Interagency Affairs is working with 
Project management Team to facilitate communication with these 
organizations.
   provision of technical assistance to states on year 2000 computer 
                                problems
    Question. To what extent is the Department providing technical 
assistance to the States for Year 2000 computer problems?
    Answer. The Department has taken several steps to provide technical 
assistance to the States regarding Year 2000 computer problems. One 
initiative is a series of ``Dear Colleague'' letters sent to officials 
in the education community. The letters provide information and 
guidance on how to ensure that computer systems are Year 2000 
compliant. Other steps include consultations with State information 
technology officials and the distribution of outreach materials that 
provide information on best practices and tools that are useful in 
addressing the Year 2000 challenge.
    In addition, the Department has widely distributed an informational 
brochure on year 2000 to the education community, set up a Year 2000 
web site (www.ed.gov/y2k/), and opened two Year 2000 electronic 
mailboxes ([email protected] and [email protected]) to answer questions.
                                 ______
                                 
               Questions Submitted by Senator Ted Stevens
                          education technology
    Question. The Administration is proposing a new $75 million program 
for Teacher Training in Technology intended to increase new teachers' 
ability to apply technology in their classrooms. To what extent are 
funds authorized to be spent, and already being spent, on preservice 
training in technology under the following programs: Regional 
Technology in Education Consortia, Technology Literacy Challenge Fund, 
and Eisenhower Professional Development State grants?
    Answer. The Department cannot provide the amounts that the two 
State-formula grant programs, the Technology Literacy Challenge Fund 
and the Eisenhower Professional Development State Grants, are spending 
on preservice training in technology. The Regional Technology in 
Education Consortia currently spend approximately 5 percent of their 
funding, or $500,000, on preservice activities. However, the Department 
does not feel that any of the programs listed is well-suited to 
increase dramatically the percentage of new teachers prepared to use 
technology effectively in their classrooms.
    The Regional Technology in Education Consortia (RTEC's) do assist 
institutions of higher education to establish programs that prepare 
teachers to use educational technology in their classrooms. That is 
just one aspect of the RTEC's broad mandate to provide technical advice 
and training to States, schools, districts, adult literacy centers, and 
other educational institutions about the use of advanced technologies 
to improve teaching and student achievement.
    The Technology Literacy Challenge Fund provides formula grants to 
States for competitive grants to local educational agencies, to fund a 
wide range of technology needs. The strength of this program is that it 
allows States to determine their own needs and provides comprehensive 
funding for educational services. Funding for preservice education is 
not specifically authorized. For this reason, it would not be the best 
funding source for training new teachers.
    The Eisenhower Professional Development State Grants may be used to 
fund preservice training; however, the vast majority of Eisenhower 
funds flow to local school districts and are used primarily to fund 
inservice professional development activities. Sixteen percent of 
program funds are allocated to State agencies for higher education to 
award competitive grants to institutions of higher education or 
nonprofit organizations. The majority of these funds are also used for 
inservice professional development. In addition, the first $250 million 
of any funds appropriated for the program are to be used for 
professional development activities in mathematics and science.
                   spending on educational technology
    Question. How much is the Department spending on technology for 
education?
    Answer. The Department has several programs dedicated specifically 
to supporting educational technology. These programs are:
    The Technology Literacy Challenge Fund is helping States and local 
school districts integrate technology into school curricula. The fiscal 
year 1998 appropriation is $425 million.
    The Technology Innovation Challenge Grants support public-private 
partnerships that generate new learning content and instructional 
practices that may be adopted by schools and communities across the 
country. The fiscal year 1998 appropriation is $106 million.
    The Regional Technology in Education Consortia provide technical 
assistance to State and local educational agencies on the use of 
advanced technologies to improve teaching and student achievement. The 
fiscal year 1998 appropriation is $10 million.
    Star Schools supports innovative projects in distance learning 
education for elementary and secondary education, providing courses and 
professional development through telecommunications technology. The 
fiscal year 1998 appropriation is $34 million.
    Ready to Learn Television supports the development of educational 
programming centered on school readiness, as well as grants for local 
educational and community outreach activities related to school 
readiness. The fiscal year 1998 appropriation is $7 million.
    The Telecommunications Demonstration Project for Mathematics 
provides support for PBS ``Mathline,'' a year-long course of 
professional development in mathematics based on the standards 
developed by the National Council for Teachers of Mathematics. The 
fiscal year 1998 appropriation is $2.035 million.
    The total for appropriation for programs that specifically support 
educational technology is $584.035 million. In addition to the programs 
listed above, funds from Title I, Goals 2000, Special Education State 
Grants, and other programs, can also be used for educational 
technology.
                            technology plan
    Question. Have you completed and submitted the overall education 
technology plan that the Congress requested in the fiscal year 1998 
appropriations?
    Answer. No, the Department has not yet completed this plan that 
Congress requested in the fiscal year 1998 appropriation. We intend to 
submit such a plan to the Committee later this spring.
        idea amendments of 1997--regulations benefits and costs
    Question. On June 4, 1997, President Clinton signed into law the 
Individuals with Disabilities Education Act (IDEA) Amendments of 1997, 
Public Law 105-17. On October 22, 1997, the Department of Education 
issued a Notice of Proposed Rulemaking (NPRM) to implement the 
Amendments. The NPRM, as required, discussed the potential costs and 
benefits of the proposed regulations (62 FR 55054). Through the public 
comment period, has the Department of Education gained any additional 
information concerning the costs and benefits of the regulatory 
package?
    Answer. The Department received over 4,500 comments on the proposed 
regulations. Many comments addressed the benefits to families and 
children of various changes and the potential impact of the proposals 
on teachers and schools. However, virtually none of the comments 
provided specific cost information that could be used in refining the 
Department's analysis of the costs and benefits of the regulations.
                     special education expenditures
    Question. Special education expenditures in the United States are 
estimated at approximately $36 billion. What portion of special 
education expenditures are devoted to costs not directly related to 
special education and related services such as attorneys' fees/
litigation and administrative expenses?
    Answer. We do not currently collect information from the States on 
special education expenditures. However, a study conducted by Decision 
Resources in 1988 indicated that about 7 percent of the funds used for 
special education services are used for administrative costs. We do not 
know how much money is used for costs associated with litigation or 
attorney's fees, but we believe that it is very small. A study by the 
General Accounting Office found that there were 73 civil actions in 
1988. Attorneys are also frequently present at due process hearings, 
which are held for about one out every 1,000 children each year.
       state administration and local program funding under idea
    Question. What percentage of the Federal appropriation reaches the 
classroom?
    Answer. We do not know what percentage of the Grants to States 
appropriation reaches the classroom. From funds appropriated in fiscal 
year 1997, States may use up to 25 percent of the funds they receive 
for State level activities and at least 75 percent of the funds must be 
passed through to local educational agencies. Data reported by the 
Department in response to a directive in the fiscal year 1998 
appropriations conference report indicate that States actually retain 
only about 8 percent of their funding for State level activities. 
Because of changes made in the authorizing legislation by the 
Individuals with Disabilities Education Act Amendments of 1997, from 
fiscal year 1998 appropriations, States will be allowed to retain an 
average of only up to 21 percent of the funds they receive for State 
level activities and at least 79 percent must be passed through to 
local educational agencies. The percentage of funds that can be 
retained for State level activities will continue to decline to the 
extent that State allocations increase by amounts greater than 
inflation.
    Local educational agencies may use the funds they receive for a 
wide range of purposes including salaries for special education 
teachers, specialized instructional materials, and training personnel. 
We do not have information on the extent to which local educational 
agencies use Federal funds for in-class purposes. South Carolina, which 
has compiled a detailed break-down of expenditures for a variety of 
programs, has data that indicate that instruction and instructional 
support account for 83 percent of the Federal special education funds 
used by local school districts.
 proposed expansion of the education flexibility demonstration program
    Question. In a speech to the National Governors' Association on 
February 23, 1998, you proposed eliminating the 12 State cap under the 
Education Flexibility Demonstration Program (Ed-Flex) authority. When 
will legislative language be introduced for this proposal?
    Answer. The Department is currently preparing legislative language 
to make all States eligible to receive the authority to waive certain 
Federal statutory and regulatory requirements. The Department 
anticipates that legislative language will be ready for introduction in 
late spring.
         requirements for participation in the ed-flex program
    Question. Do you propose adding any new requirements for States to 
participate in Ed-Flex?
    Answer. The Department intends to propose that, before a State may 
receive the authority to waive certain Federal statutory and regulatory 
requirements, it have in place the content and performance standards 
and aligned assessments required by Title I of the Elementary and 
Secondary Education Act of 1965, and also have in place procedures for 
holding local school districts and schools accountable for meeting 
academic performance goals. Though the 12 States currently 
participating in the Education Flexibility Demonstration Program were 
not required to have their content and performance standards or aligned 
assessments and accountability procedures in place before receiving the 
waiver authority, an analysis of how these States have used their 
waiver authority indicates that well-developed State assessment and 
accountability systems allow for a more effective implementation of the 
waiver authority. For example, Texas, a State that has developed a 
statewide assessment and accountability system that provides 
disaggregated student achievement data, has made more extensive and 
effective use of the waiver authority than other States with the waiver 
authority.
    When the Ed-Flex authority was created under Goals 2000, the Title 
I performance requirements did not yet exist. Our proposals would thus 
align Ed-Flex with the current Elementary and Secondary Education Act 
requirements.
    Question. Would you continue to require that States participate in 
the Goals 2000 program in order to be eligible for Ed-Flex?
    Answer. No, States would not have to participate in the Goals 2000 
program to be eligible. To receive the waiver authority, States would 
have to have in place the content and performance standards and aligned 
assessments required by Title I, and provide their State educational 
agency with the authority to waive State statutory or regulatory 
requirements while continuing to hold the local educational agencies 
that receive waivers accountable for the performance of students 
affected by the waivers.
      proposed expansion of programs eligible for ed-flex waivers
    Question. Currently, the number of programs under which 
requirements can be waived is substantially fewer under Ed-Flex than 
under most other Federal education waiver authorities, such as the 
authority covering all of the Elementary and Secondary Act. Do you 
propose that the number of programs covered by Ed-Flex be expanded?
    Answer. Yes, the Department is proposing to expand the number of 
programs for which States could waive certain Federal statutory and 
regulatory requirements so that it is more closely aligned with the 
waiver authority provided under the Elementary and Secondary Education 
Act of 1965. The authority would extend to all of the Department's 
major State formula programs for elementary and secondary education, 
except those under the Individuals with Disabilities Act.
          experience with ed-flex and other waiver authorities
    Question. What has been your experience thus far with Ed-Flex, and 
with other waiver authorities relevant to Federal elementary and 
secondary education programs?
    Answer. The Department's experience with waivers has been that 
relatively few waivers have been requested from the Department and the 
Ed-Flex States, and that the range of provisions requested to be waived 
is similarly small. This would seem to indicate that Federal laws and 
regulations are not acting as significant barriers to State and local 
improvement initiatives, and that most States, local school districts, 
and schools already possess the flexibility needed to accomplish their 
objectives without waivers of Federal requirements.
    The States that are making the most extensive and effective use of 
the waivers are those with well-developed assessment and accountability 
systems. The data provided by such systems allows the State to 
determine whether the waiver is promoting increased achievement among 
all students affected by the waiver. The absence of strong assessment 
and accountability systems makes it nearly impossible for a State to 
ensure that there is adequate accountability for the flexibility 
provided.
    Question. Are the authorities being extensively exercised?
    Answer. No, the authorities are not being extensively used. From 
school year 1994-95 until the beginning of the 1997-98 school year, the 
Department received 435 waiver requests from State educational agencies 
and local school districts in 48 States. State educational agencies had 
submitted 60 waiver requests. The remaining 375 requests were from 
school districts, representing less than 3 percent of school districts 
nationally.
    The majority of Ed-Flex States are also not using the waiver 
authority extensively. Ten of the 12 approved States have received 
fewer than 35 waiver requests. Oregon, which was the first State 
granted the authority in February of 1995, has received only 20 
requests for waivers since then. The waiver authority is being used 
most extensively by Texas, which has received 4,248 waiver requests 
since obtaining the authority in January of 1996. The great majority of 
Texas waivers, 89 percent, have been for statewide waivers of 
administrative requirements.
                    range of provisions being waived
    Question. What sorts of requirements are being waived?
    Answer. The experience of both the Department and the Ed-Flex 
States indicates that the range of provisions being waived is 
relatively small, and waivers of similar provisions are being requested 
of the Department and the Ed-Flex States.
    The waivers requested of the Department fall into 5 general 
categories: (1) waivers granted to State educational agencies that help 
to strengthen State school reform efforts and increase the flexibility 
available to school districts within the State; (2) waivers of the 
minimum poverty threshold for implementing schoolwide programs under 
Title I of the Elementary and Secondary Education Act of 1965; (3) 
waivers of provisions for targeting Title I funds within a school 
district; (4) transition waivers to accommodate temporary situations 
during periods of change; and (5) waivers of the mathematics and 
science priority under Eisenhower Professional Development program.
    Similarly, in the Ed-Flex States, the great majority of 
programmatic waivers have been to waive some of the requirements of 
Title I, such as the minimum poverty threshold for implementing a 
schoolwide program or provisions for targeting Title I funds within a 
school district. As does the Department, Ed-Flex States receive 
requests for waivers of the Title II mathematics and science 
requirement.
    Question. Are there types of requirements that many States or local 
school districts would like to waive but they may not do so under 
existing waiver authorities?
    Answer. The requirements that some States and local school 
districts would like to waive, but which currently may not be waived, 
are certain provisions of the Individuals with Disabilities Education 
Act (IDEA), particularly the reporting requirements. However, the 
Department does not feel that this authority is the appropriate place 
to address these issues.
                    rationale for ed-flex expansion
    Question. Is Ed-Flex expansion being proposed now primarily to 
counter the increasing interest--on the part of many Members of 
Congress, Governors, and others--in consolidating many Federal 
education programs into block grants?
    Answer. No, we are not proposing the Ed-Flex expansion in order to 
counter the consolidation proposals. The Department is committed to 
providing States, local school districts, and schools with flexibility 
in implementing the educational reforms necessary to ensure that all 
children are able to achieve to high standards. The Elementary and 
Secondary Education Act already provides States and local educational 
agencies with a great deal of flexibility. Examples of the increased 
flexibility provided under the 1994 reauthorization include the 
authority to use a consolidated State plan to apply for Federal program 
funds, the ability to consolidate administrative funds from several 
different programs, and the authorization for greater numbers of 
schools to implement Title I schoolwide programs.
    The Department's experience with waivers indicates that the current 
legislation provides much of the flexibility needed by State and local 
educators to implement their school reform efforts. Often, the barriers 
to local reform are created by State statutory or regulatory 
restrictions. The Department feels that, in exchange for gaining the 
ability to waive many Federal statutory and regulatory requirements, 
States will be willing to provide their State educational agencies with 
the authority to waive many State requirements. The Department also 
believes that providing greater numbers of local school districts and 
schools with waivers of certain Federal and State statutory and 
regulatory requirements will provide them with an environment that 
promotes creative and innovative school improvement plans that lead to 
increased achievement for all students.
    Question. Beyond the 12 States already participating in Ed-Flex, 
how many other States are you aware of that might be prepared to offer 
waivers of their own requirements and meet the other conditions of Ed-
Flex participation?
    Answer. The Department believes that all States will eventually 
meet the conditions necessary to receive the authority to waive certain 
Federal statutory and regulatory requirements. The requirements to have 
in place content and performance standards along with an aligned 
assessment system and procedures to hold local school districts and 
schools accountable for student academic performance are already 
contained in the Elementary and Secondary Education Act of 1965. In 
addition, as it is often the case that State requirements serve as a 
the major barrier to the successful implementation of local reform 
efforts, the Department expects that States will be willing to provide 
the authority to waive State requirements that impede reform in return 
for the ability to waive some Federal requirements.
                     effect of impact aid policies
    Question. While you are requesting about 5 percent less for Impact 
Aid basic support payments (a $36 million reduction), payments to LEA's 
in some States decrease by substantially higher percentages. For 
example, overall payments to LEA's in Alaska would decrease by over 50 
percent according to estimates in your table on page C-47 of the 
Justification. To what extent does each of your three proposed changes 
in the Impact Aid formula account for these shifts in funding?
    Answer. The table below indicates the amount of funds that would 
shift due to each of the proposed changes in the Basic Support Payments 
formula. The table displays these results separately for Alaska and for 
all States combined. These numbers were determined by simulating the 
formula in current law for 1999 at the requested appropriation level of 
$626 million. Then the formula was simulated three additional times at 
$626 million using current law and one of the three proposed changes in 
the formula: (1) the weighted child count; (2) the Learning Opportunity 
Threshold (LOT); and (3) the calculation of maximum payments. The 
figures in the table represent the gross dollars that shift due to each 
change in the formula. Because the Basic Support Payments formula is 
``non-linear,'' the changes in the components of the formula do not 
necessarily add to the net change for a State when all three proposed 
changes to the formula are included together.

    EFFECT OF PROPOSED CHANGES IN THE BASIC SUPPORT PAYMENTS FORMULA
  [Estimates of the number of dollars by which impact aid basic support
    payments change, by formula component, for fiscal year 1999 at an
                     appropriation of $626 million]
------------------------------------------------------------------------
                                       Dollars lost or       Dollars
                                          gained by       transferring
                                            Alaska      among States \1\
------------------------------------------------------------------------
Weighted child count.................     $15,543,663        $94,205,848
Learning opportunity threshold [LOT].     (18,921,824)       143,744,371
Maximum payments.....................     (34,535,155)        98,499,296
------------------------------------------------------------------------
\1\ These dollars reflect the amount of funds that shift among States
  due to changes in formula components. For instance, the change in the
  weighted child count would cause all States that gain funds under the
  formula change to gain a total of $94,205,848 and all of the States
  that lose funds to lose a total of $94,205,848.

   impact aid--proposed learning opportunity threshold formula change
    Question. You have justified changes in the calculation of the 
learning opportunity threshold (LOT) in part because current law 
encourages LEA's to decrease their tax efforts. What evidence do you 
have that current law has had this effect?
    Answer. We have proposed the change in calculating LOT in part 
because it would eliminate a pernicious effect of current law--the 
potential reward for LEA's that reduce local tax effort. We are not 
aware of any LEA that has actually reduced local tax effort for this 
reason.
    The current LOT potentially benefits LEA's that reduce their tax 
effort because the LOT percentage is the sum of: (1) the percentage of 
federally connected students and (2) the percentage of the maximum 
payment under the Basic Support Payments formula as a percentage of 
total current expenditures. The sum of these two percentages may not 
exceed 100 percent.
    An LEA could reduce its tax effort and its total current 
expenditures, which would increase the latter of the two components of 
the LOT percentage. The LOT percentage is an important component of the 
Basic Support Payments formula. The LOT percentage is multiplied by the 
maximum payment to determine the LOT payment when funds are 
insufficient to fully fund maximum payments. LOT payments have been the 
basis for calculating actual payments because the formula has not been 
fully funded since its inception.
        number of impact aid lea's decreasing their tax efforts
    Question. How many LEA's receiving Impact Aid payments have 
substantially decreased their efforts since 1992?
    Answer. We do not know how many LEA's have substantially decreased 
their tax effort since 1992. However, as noted above, we know that a 
potential reward exists for LEA's that decrease their tax effort. As 
part of an effort to minimize paperwork burden on LEA's, we do not 
require LEA's to submit data on tax effort when they apply for Basic 
Support Payments.
     impact aid reductions resulting from proposed formula changes
    Question. How many LEA's would receive payments that are less than 
85 percent of their prior year Impact Aid payment (the current-law hold 
harmless requirement) as a result of your proposed formula changes?
    Answer. Among those LEA's that would receive funds in 1999, we 
estimate that (under the Administration's proposed budget and formula) 
228 would receive payments that are less than 85 percent of their 
prior-year Impact Aid payment.
    Question. How will these LEA's make up for the sudden reduction in 
Federal aid?
    Answer. We do not know specifically how these LEA's will make up 
for the decrease in Federal aid, but they should be the best positioned 
to absorb the loss of funds. We have proposed the formula changes 
because we are concerned that Basic Support Payments are not being 
directed to those LEA's with the greatest need for these funds: (1) 
LEA's with students living on Indian lands and children of members of 
the uniformed services who live on Federal property; (2) LEA's that are 
responsible for funding a large proportion of the cost of educating 
their students; and (3) LEA's with large percentages of federally 
affected students. LEA's that lose funds under our proposed formula do 
not meet these criteria and should be able to more easily absorb the 
cost of educating their federally connected students than other LEA's.
    Question. Can you assure the Subcommittee that there will be no 
negative impacts on the quality of education in those LEA's?
    Answer. We cannot assure the Subcommittee that there would be no 
negative impacts on the quality of education in LEA's with smaller 
Basic Support Payments in 1999 than 1998. As indicated under the 
preceding question, however, we believe that these LEA's can more 
easily absorb the cost of educating federally affected students than 
can other districts.
                          the cost of college
    Question. The Federal investment in higher education through the 
student aid programs administered by the U.S. Department of Education 
has grown markedly over the past century, as has the price of college. 
Has this increased Federal support of student financial assistance 
prompted increases in the prices charged students and their families?
    Answer. We also are concerned about the rise in college tuition 
costs in recent years. We do not believe, however, that the increase in 
college prices can be attributed in any significant way to the 
increased availability and amount of Federal student aid. A number of 
recent studies have examined this issue, including those performed by 
the National Commission on the Cost of Higher Education, Professors 
McPherson and Shapiro, and the National Association of Independent 
Colleges and Universities and have failed to find a correlation between 
the growth of Federal student aid programs and the increase in college 
tuitions. In fact, the NAICU study showed the opposite effect. NAICU 
found that Federal grant aid actually helps to slow the rate of tuition 
growth at independent colleges and universities.
    Question. What impact will the new Hope Scholarships and Lifetime 
Learning credits have on college prices?
    Answer. We do not anticipate that the new Hope Scholarships and 
Lifetime Learning tax credits will provide have any effect on college 
prices. There is no evidence of a relationship between the presence of 
Federal student aid and tuition increases. Institutions cannot easily 
raise tuitions when only a portion of their students, many of them 
part-time, receive education tax benefits or Federal grants. State 
institutions have a particularly difficult time raising tuitions since 
their services are viewed as a public benefit to their citizens and 
they must typically go through the State legislature for approval of 
tuition increases.
               percent of cost covered by federal grants
    Question. What is the percentage of the average cost of education 
that can currently be covered by the maximum and average Pell Grant or 
Supplemental Educational Opportunity Grant?
    Answer. Below is a chart comparing the average tuition, fees, and 
room and board to the maximum and average Pell Grant and Supplemental 
Educational Opportunity Grant (SEOG) programs for the 1996-97 award 
year. In general, the maximum Pell Grant of $2,470 in 1996-97 was 
sufficient to cover approximately 27 percent of the average cost of 
education at all schools. However, the average Pell Grant was 
approximately $900 lower than the maximum, so that the average Pell 
Grant was sufficient to cover about 17 percent of the average cost of 
attendance. These percentages, as expected, are higher for public 
institutions, and generally lower at more expensive private 
institutions.
    The maximum SEOG of $4,000 would cover approximately 44 percent of 
the average college cost. However, the average SEOG in 1996-97 was 
significantly lower than the maximum ($701 versus $4,000), so the 
amount of college cost covered by the average SEOG was less than 8 
percent.

                                                PELL GRANT AND SEOG AWARDS AND COST OF EDUCATION--1996-97
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     Average   Maximum   Percent  Average  Percent   Maximum   Percent  Average  Percent
                                                                    cost \1\     Pell    of cost    Pell   of cost     SEOG    of cost    SEOG   of cost
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total.............................................................    $9,199     $2,470     26.9   $1,574     17.1     $4,000     43.5     $701      7.6
Public 4-year.....................................................     7,331      2,470     33.7    1,668     22.8      4,000     54.6      743     10.1
Public 2-year.....................................................     4,412      2,470     56.0    1,493     33.8      4,000     90.7      404      9.2
Private 4-year....................................................    18,476      2,470     13.4    1,673      9.1      4,000     21.6    1,131      6.1
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Cost includes tuition, fees, room and board.
 
Sources: ``Digest of Education Statistics'', 1997, NCES; Pell Grant: Pell grant cost estimation model, OPE; SEOG: ``Federal Campus-Based Programs
  Distribution of Awards 1996-97'', OPE.

                      impact of budget proposal on
    Question. What impact on these statistics will your budget request 
or your proposal for reauthorization of the Higher Education Act have?
    Answer. In our fiscal year 1999 Budget, we are proposing an 
increase of $100 in the maximum Pell Grant from $3,000 to $3,100. This 
maximum award increase builds on the two years of unprecedented growth 
in the maximum Pell Grant for 1997-98 and again for 1998-99, when the 
maximum grants increased 9.3 percent and 11.1 percent, respectively. 
The large increases in the maximum Pell Grant between 1997-98 and 1998-
99, coupled with the increase we propose in 1999-2000, will increase 
the percent of college cost covered by the maximum Pell Grant by over 2 
percent, to slightly over 29 percent, and the percent of cost covered 
by the average Pell Grant from 17 percent to 18 percent.

                             PELL GRANTS AND COST OF EDUCATION--1996-97 TO 1999-2000
----------------------------------------------------------------------------------------------------------------
                                                   Estimate                               Estimate
                   Award year                      average      Maximum     Percent of    average     Percent of
                                                     cost         Pell         cost         Pell         cost
----------------------------------------------------------------------------------------------------------------
1996-97........................................       $9,199       $2,470         26.9       $1,574         17.1
1997-98........................................        9,659        2,700         28.0        1,699         17.6
1998-99........................................       10,142        3,000         29.6        1,894         18.7
1999-2000......................................       10,649        3,100         29.1        1,936         18.2
----------------------------------------------------------------------------------------------------------------
Source: Pell grant cost estimation model, OPE.

                        access to student loans
    Question. The Administration's proposal for addressing issues 
arising from the reduction in the Federal Family Education Loan's 
interest rate, scheduled to occur on July 1, 1998, would lead to a 
significant reduction in lender returns. To what extent will this 
reduction cause some lenders to stop making loans under the FFEL 
program?
    Answer. Based on a Department of Treasury analysis, the 
Administration proposed an interest rate formula that would ensure an 
adequate rate of return to lenders at little or no net cost to 
students. Therefore, the Administration believes that lenders would not 
stop making loans under its proposal which the Treasury study showed 
provided sufficient profits to maintain FFEL lender participation.
                ensuring continued access to ffel loans
    Question. How will the Department deal with any access problems 
that result?
    Answer. We are taking steps to implement the broad authority 
granted by Congress to ensure continued access to FFEL loans. We are 
committed to assuring that no student is denied the financial help he 
or she needs to go to college.
    As part of the effort to ensure uninterrupted access to college 
student loans, we have held discussions with the Student Loan Marketing 
Association (Sallie Mae) and have contacted all 36 guaranty agencies 
about their capacity to fulfill their statutory obligation to issue 
loans if necessary. Of the 36 guaranty agencies contacted, nearly all 
indicated they could serve in some capacity as lender of last resort.
    One of these guaranty agencies, the Pennsylvania Higher Education 
Assistance Agency, has already informed the department that it could be 
available right away to make at least one million student loans to 
assist students across the nation. This is triple the number it 
currently makes and about one-fifth of all FFEL loans made nationwide. 
Nearly all of the guaranty agencies have indicated that they are ready 
to make loans if necessary to ensure loan access.
               student financial aid information systems
    Question. What steps has the Department taken to address the recent 
criticisms by the GAO of the accuracy and efficiency of its information 
systems used in determining student eligibility for financial aid, 
processing aid applications, and informing students and institutions 
about the status of grants and loans?
    Answer. In 1995, the Department recognized the need to use cutting-
edge technology and business processes to transform the administration 
of student financial aid and improve customer access to information and 
funding for education beyond high school, and began to work with our 
partners in the postsecondary education community to design, integrate 
and develop a comprehensive student financial aid delivery system using 
state-of-the-art information technology.
    The effort has become known as Project EASI (Easy Access for 
Students and Institutions). The following is an update on this 
important project:
Delivery of Systems Architecture Report--Completed
    The Department developed the Technical Vision and Target 
Architecture Report in September 1997. This presents a conceptual 
framework for EASI's technical environment but is only one component of 
an overall architecture.
Development of Standard Data Formats and Definitions--In process
    A data model is being developed for Project EASI. This will contain 
standard data definitions and formats. ED has met with the 
Postsecondary Education Standards Council (PESC) to solicit their 
support in reviewing these standards. Our goal is to obtain buy-in from 
the higher education community on EASI's data model.
    As additional steps toward data standardization, we are also 
working on two projects to pilot EDI technology. These include allowing 
lenders to submits requests for interest and special allowance on FFEL 
loans in an EDI format and allowing schools to submit Pell Grant 
origination records in an EDI format.
Student Enrollment Verification--In process
    ED continues to work closely with schools, guarantee agencies and 
enrollment servicers to ensure that enrollment data is timely and 
accurate. In cases of schools not responding to our requests for data, 
ED has initiated fines as an enforcement mechanism. If this is not 
successful, ED will consider limitation, suspension and termination 
actions against the school.
Development of a Multi-View Enterprise Architecture--In process
    SFA must develop an enterprise architecture that addresses more 
than just the technical environment. An enterprise architecture would 
describe four additional architectural views: (1) which organizations 
perform which pieces of work (this is called the work view); (2) what 
information these organizations need to do their work (the information 
view); (3) what software applications will be needed to perform the 
work (application view); and (4) the technical standards which will 
provide a framework for implementing EASI (technical infrastructure). 
We have hired an expert in this field who is working to provide the 
completed enterprise architecture by December 1998.
Movement toward an Integrated Data System--In process
    In December 1997 Project EASI entered the definition phase of the 
system development life cycle. Specifically this stage involves: (1) 
defining what the Title IV delivery process will look like in the 
future; (2) establishing the standards for technology and data and (3) 
establishing a detailed implementation schedule. When current tasks for 
the definition phase are completed in September 1998, development work 
on the new system is expected to begin.
    Project EASI's vision of integrating the data processing systems 
that the Department uses has prompted ED to reconsider the student 
financial assistance programs' current contracting structure. Early in 
1997, ED identified an alternative way to structure the Title IV 
information technology and support services contracts. This contracting 
strategy introduces a functionally driven approach to procuring the 
services ED requires for the Title IV programs. Part of this approach 
is to consolidate all of the Title IV systems into a single data 
center. Through this approach we will gain economies of scale and 
reduce costs. This will also set the stage for a common operating 
environment that will facilitate system integration. During February of 
1998 we moved the National Student Loan Data System to the new data 
center and we plan to move the remaining systems during 1998 and 1999.
        performance based organization for student aid programs
    Question. Please share with the committee what steps the Department 
has taken to create a ``performance-based organization'' to administer 
student aid information, processing and delivery systems?
    Answer. The Department has taken several steps toward creating a 
performance based organization (PBO). I believe that the Student 
Financial Assistance (SFA) Programs meet many of the criteria 
identified by the National Partnership to Reinvent Government (NPRG) 
and is a good candidate to become a PBO because of its clear mission, 
measurable services to external customers and its opportunities for 
significant improvement.
    Acting Deputy Secretary Mike Smith is leading the overall effort. 
Our main vehicle for PBO planning is the SFA Action Plan. This tool was 
developed under Acting Deputy Assistant Secretary for Student Financial 
Assistance Diane Rogers' to guide the work of SFA, the PBO outreach, 
design, and transformation process. The Department is working with the 
SFA Modernization Board, the White House, the OMB, the Treasury and 
Congress.
    The PBO will be managed by a Chief Operating Officer (COO) with a 
demonstrated record of effective management. The COO will report to the 
Secretary and have a fixed contract and term. The COO's compensation 
will be tied to performance under an agreement with the Secretary. The 
COO will have authority to hire senior managers whose compensation will 
also be tied to the achievement of PBO performance goals. The 
Department's target is to identify a COO by the end of summer 1998.
    Question. Does the Department's action to date reflect the 
legislative proposal under consideration by the Congress?
    Answer. Yes, the Department's actions are generally consistent with 
the intent of the legislative proposals (S. 1182) and (H.R. 6) under 
consideration.
    Question. Do you believe that the Department needs any new 
statutory authority to establish such an organization?
    Answer. Generally, a PBO can be established without legislation. 
Legislation may be required in some instances to provide flexibility 
under existing statutes or to establish special reporting or 
consultation requirements. The Department is starting discussions now 
regarding how current authorities might be used to establish the PBO 
without legislation. The Department's goal is to use this new 
organizational tool in ways that are beneficial to students and 
families, taxpayers, schools, financial institutions, and employees.
      participation of hispanic-serving institutions in title iii
    Question. What is the universe of institutions potentially eligible 
to receive funding under the Hispanic-serving institutions program 
authorized by the Part A program of Title III of the Higher Education 
Act?
    Answer. The Department of Education estimates that about 135 
institutions of higher education are eligible Hispanic-serving 
institutions (HSI's).
    Question. To what extent are potentially eligible HSI's 
participating in the Hispanic-serving institutions program authorized 
by the Part A program of Title III of the Higher Education Act?
    Answer. In 1995, the first and only competition for the HSI 
program, 90 institutions applied for funding. Of those that applied, 37 
institutions received awards. Therefore, just over 25 percent of 
potentially eligible HSI's in 1995 participated in the HSI program.
  differences between hispanic-serving institutions and historically 
                    black colleges and institutions
    Question. What are the differences in what constitutes an Hispanic-
serving institution (HSI) under Part A of Title III and an historically 
black college or university (HBCU) under Part B of Title III?
    Answer. There are many differences in what constitutes an HSI and 
an HBCU under Title III. For the HSI program, eligible institutions 
must first have a high enrollment of needy students and low educational 
and general expenditures. Should they meet this criteria, then the 
institution must also have at least 25 percent Hispanic undergraduate 
full-time equivalent enrollment. Fifty percent of these Hispanic 
students must be low-income and first-generation college students and 
an additional 25 percent of these Hispanic students must be low-income 
or first-generation. Further, the program gives absolute priority in 
funding to institutions that have a collaborative arrangement with a 
local education agency to reduce the high Hispanic drop out rate, 
improve Hispanic rates of academic achievement, or increase the rates 
at which Hispanic students enroll in higher education.
    Eligibility for the HBCU program requires only that the institution 
be accredited and established prior to 1964 with a mission to educate 
black Americans. There are no student or financial criteria. In 1996, 
there were 96 HBCU's eligible under Title III statute, all of which 
receive annual funding.
    Question. Have these differences in what constitutes a Hispanic-
serving institution under Title III Part A and a historically black 
college and university under Title III Part B lead to any significant 
or obvious inequities in the administration of the program?
    Answer. These differences do not create any obvious inequities in 
the administration of the programs. However, the statutory differences 
in eligibility between the HSI's and HBCU's programs do require that 
they be administered differently.
    The HBCU program awards grants to all eligible institutions and the 
amount of each award is based on a formula allocation. In contrast, the 
HSI program is a competitive program--only the best applications are 
funded, not all eligible institutions.
    While both programs grant five year institutional aid awards, the 
minimum annual award for HBCU's is $500,000 while the maximum annual 
award for HSI's is $350,000. In fiscal year 1997, the average award for 
each HBCU was $1.1 million while for HSI's the average award was 
$292,000.
                hbcu's without majority black enrollment
    Question. How many historically black colleges and universities no 
longer serve substantial black student populations, yet still receive 
assistance under the Title III program?
    Answer. Of the institutions that receive assistance under the Title 
III, Part B program, there are six HBCU's that have less than a 50 
percent black student population. Of these institutions, four HBCU's 
have less than 25 percent black student population.
           government performance and results act measurement
    Question. The Government Performance and Results Act of 1993 
(GPRA), Public Law 103-62, requires all Federal agencies to phase in a 
process that uses performance measures to set management and budgeting 
objectives. What is the current situation at the Department regarding 
full implementation?
    Answer. The Department has identified performance indicators for 
all the goals and objectives put forth in our cross-cutting Strategic 
Plan. Data systems are in place to collect required information for 
many of the indicators; and we are modifying existing data systems or 
developing new data systems for the others.
    In addition, each program in the Department now has a performance 
plan with objectives and performance indicators. The performance data 
for some programs are readily available and of high quality, but for 
others baseline data are under development or improvement is needed to 
ensure quality. Currently we are working to (1) align existing data 
collections including evaluations, statistical surveys, and grantee 
performance data systems; (2) establish new data collections as needed; 
and (3) verify and validate data by developing standards and quality 
assurance systems.
                     gpra implementation challenges
    Question. What problems have you encountered in the application of 
the GPRA procedures to date?
    Answer. Most of the challenges we face in the application of GPRA 
relate to collecting good performance data. These challenges include:
  --Gaining employee acceptance for taking responsibility to collect 
        and use information on performance indicators when they have 
        little or no control over the results;
  --Obtaining uniform performance measures across grantees;
  --Ensuring high-quality, timely performance data;
  --Improving self-reported information from grantees;
  --Developing intermediate performance indicators that provide early 
        warning of problems; and
  --Obtaining valid measures for complex indicators.
    The other area with many challenges is how to make the Strategic 
Plan's goals and strategies meaningful to all ED employees. We are 
working on communication strategies, changes to employee evaluations, 
and internal reporting.
    Question. What changes if any, do you anticipate making in the 
coming year to your strategic goals and performance plans?
    Answer. Over the coming year the Department may make minor changes 
in Strategic Plan indicators, but we do not foresee making any changes 
to our Strategic Plan goals and objectives.
    The Annual Performance Plan for the Department's objectives and 
programs will be updated during the fiscal year 2000 budget development 
process, which begins this summer. We have a number of improvements 
already planned for the program plans in particular, including adding 
baseline data and setting performance goals for all the program plans.
              gpra measures in the fiscal year 1999 budget
    Question. To what extent has the Department used GPRA measures in 
developing the fiscal year 1999 budget request?
    Answer. GPRA has provided a framework for performance planning in 
the Department, for developing both long-term and annual goals and 
objectives, and budget proposals to support them. The Department built 
GPRA into its internal budget process. In preparing their proposals, 
senior managers were instructed to relate their request to meeting the 
Strategic Plan priorities and objectives, to use performance 
information to support their request, to gear their proposals to 
implementing strategies to achieve their performance goals and 
objectives, and to identify resources to carry out the strategies in 
the performance plans including resources needed to collect and verify 
performance data.
    We have done extensive work on developing performance measures for 
all of the Department's programs and have incorporated performance 
measures and indicators into the Congressional Justifications as well 
as into individual program plans. In developing the fiscal year 1999 
budget request, GPRA helped us to focus in a more comprehensive way on 
the expected outcomes of our programs and benefits of future 
investments and to consider much more concretely the impact of our 
programs on our customers, particularly students.
    While the Department has included performance data in its budget 
requests in the past, with GPRA we will have data for all programs, the 
quality of data will be improved, and the information we receive will 
focus on results, not just processes. While we will not have outcome 
data for every program in every year, we will continue to collect data 
as it becomes available. It should be noted that fiscal year 1999 
funding would primarily support activities during the 1999-2000 school 
year. We will assess the impact of this funding in the next 2 years.
   impact of gpra on development of fiscal year 1999 budget decisions
    Question. For which programs have you requested major funding 
changes, either increases or decreases, because of the application of 
the GPRA procedures?
    Answer. The Department has long been committed to using performance 
data to inform decisions. In developing the fiscal year 1999 budget 
request, GPRA measures played a key role in our focusing on certain 
strategic goals and the resources needed to accomplish those goals. The 
following are some examples of fiscal year 1999 program budget requests 
that reflect funding changes that would help enable us to meet 
Strategic Plan and Annual Plan performance indicator goals.
  --The America Reads program ($260 million) supports Strategic Plan 
        Objective 2.2: Third Grade Reading and is part of the 
        Department's comprehensive strategy to increase the percentage 
        of students performing at or above the basic level in reading 
        on the National Assessment of Education Progress (NAEP).
      As reported in the Department's fiscal year 1999 annual plan, our 
        goal is to increase the percentage of 4th graders reading at 
        basic, proficient, or advanced levels in reading on NAEP from 
        60 percent in 1994 to 65 percent in 1998, and to 68 percent in 
        2000. In the most recent (1994) National Assessment of 
        Educational Progress (NAEP), 60 percent of fourth graders 
        scored at or above the ``basic'' level in reading. The NAEP is 
        not administered to third graders, but the fourth-grade NAEP 
        data capture reasonably well how students are reading at the 
        end of the third grade.
  --Our proposed new Teacher Training in Technology program ($75 
        million) supports Annual Plan Objectives 3.1: Training tied to 
        certification and 3.3: Staff training. A recent report by the 
        National Council of Accreditation for Teacher Education 
        criticizes the majority of teacher education programs for 
        teaching computer literacy rather than the application of 
        technology in the classroom. While the current programs focus 
        on training existing teachers, they are not well-suited to 
        increasing dramatically the percentage of new teachers prepared 
        to use technology effectively in their classrooms. This new 
        program will help ensure that all new teachers can teach 
        effectively with technology.
  --The Pell Grant program supports Strategic Plan Objective 3.2: 
        Postsecondary students--financial aid and support. Under GPRA, 
        the Department identified the Pell Grant program's primary 
        objective as providing continuing access to postsecondary 
        education for low-income students. Performance indicator data 
        show that Pell Grants are successful in helping low-income 
        students overcome financial barriers to postsecondary education 
        and that low-income students who receive them have much higher 
        participation and graduation rates than low-income students who 
        do not. A key indicator of how well the program is doing in 
        achieving this goal can be measured by the income distribution 
        of students who benefit from the program. Our request of $7.594 
        billion (+$249 million) for Pell Grants will benefit students 
        with greatest financial need by targeting more of them and by 
        increasing the maximum award.
  --The Work Study program also supports Strategic Plan Objective 3.2. 
        Studies show that first-year students who work during the 
        academic year are more likely to complete the academic year, 
        and that work has an increased impact on students' academic 
        performance when a job is more closely related to the course of 
        study. Our request of $900 million for Work-Study (+$70 
        million) will achieve the goal of expanding the program to one 
        million students and improve the level of participation in 
        community service by continuing to waive the 25 percent 
        matching requirement for participating colleges.
  --The TRIO programs request (+$53 million) and two new program 
        proposals, High Hopes for College (College-School Partnerships) 
        ($140 million) and College Early Awareness Information ($15 
        million), also support Strategic Plan Objective 3.2: 
        Postsecondary students--financial aid and support, as well as 
        3.1: Secondary students--information and support. Indicator 
        data for postsecondary education enrollment rates continue to 
        show that there is still a gap in college attendance rates 
        between high and low-income students. Research demonstrates 
        that early intervention programs that are sustained for a 
        number of years are very successful, and that academic 
        services, mentoring, counseling, and tutoring for students are 
        critical. Both High Hopes and TRIO are designed to provide 
        needed support services to a large population of disadvantaged 
        students in order to motivate and prepare these young people 
        for postsecondary education. High Hopes would operate quite 
        differently from TRIO and would be coordinated with, complement 
        and enhance services received by participating schools and 
        students under the TRIO programs and other related Federal and 
        non-Federal programs.
  --Research also shows that students, especially low-income students, 
        often do not aspire to higher education, do not discuss college 
        with their parents, think about college at an early enough age, 
        or take the proper courses to ensure college entrance. Many who 
        do manage to attend college are not fully prepared and require 
        remedial courses. This lack of information and awareness would 
        be addressed by the College Early Awareness Information 
        program.
        consultation on development of 1998-2002 strategic plan
    Question. The development of GPRA measures requires extensive 
consultation with stakeholders and the Congress regarding the 
development of strategic goals and performance plans. How extensive an 
undertaking have these activities been to date, and to what degree will 
these activities be continued during the current year?
    Answer. The Department consulted extensively with outside 
interested parties on the 1998-2002 Strategic Plan, and made changes as 
a result of those consultations.
    The Department met with and received feedback on the Strategic Plan 
goals, objectives and indicators from: Staff from Congressional 
authorizing, appropriations, budget, and government operations 
committees; General Accounting Office (GAO); Office of Management and 
Budget (OMB); and The Council for Excellence in Government.
    The Department consulted with relevant Federal agencies on our 
respective strategic plans, including the Departments of Health and 
Human Services, Labor; and Treasury; National Science Foundation; 
Social Security Administration; and the Office of National Drug Control 
Policy.
Consultation on development of program level performance plans
    The Results Act only mandates consultation on the Strategic Plan. 
While the program indicator plans are part of our Annual Plan (in 
Volume 2) and therefore consultation isn't required, in many cases, 
assistant secretaries and heads of program offices have discussed the 
program level performance plans with grantee and stakeholder groups. 
For example:
  --The assistant secretary for vocational and adult education shared 
        the vocational and adult education plans with State directors 
        to get feedback and suggestions for improvement.
  --The director for bilingual education and minority languages affairs 
        presented the draft bilingual education program performance 
        plans to the annual conference of the National Association for 
        Bilingual Education.
  --The assistant secretary for postsecondary education has shared and 
        discussed the set of student financial aid program performance 
        plans at regular meetings with key stakeholders and had these 
        program plans posted on the Office of Postsecondary Education 
        web page to make them available to stakeholders and the general 
        public.
  --The director of Indian education programs shared the program's plan 
        and indicators at the National Indian Education Association 
        conference in November 1997. This is after discussing them with 
        State directors of Indian education in July 1997.
  --Other elementary and secondary education program directors have 
        regularly presented program indicator plans at meetings with 
        their State and local program directors, including State 
        migrant education directors, Eisenhower professional 
        development program directors, and the Title VI State grant 
        program directors.
    We have found the consultation process to be very helpful in 
identifying areas of stakeholder interest, areas for coordination, and 
ways to improve the quality of our strategic plan and performance 
measurement. The Department will continue to present information on and 
engage in discussions around the Department's goals and objectives at 
conferences for stakeholders like the National Association of Federal 
Education Program Administrators. Many of our program managers are now 
routinely presenting their plans to key stakeholders and constituent 
groups as well. Finally, the fiscal year 1999 Annual Plan (Volume 1 on 
Strategic Plan objectives and Volume 2, program performance plans) is 
being placed on ED's website--the Strategic Plan is already there. We 
will continue to seek and respond to inquiries and suggestions.
                        cost to comply with gpra
    Question. What have been the administrative costs for the 
Department necessary to comply with the GPRA requirements?
    Answer. The Department views GPRA requirements as key elements of 
good management practice and not separate from other administrative 
costs. We are striving to have all levels of the agency fully 
performance-driven. Managers at all levels have participated in 
activities that support GPRA/good management practices, including 
developing strategic and annual plans; revising or developing data 
collection systems; and assuring data quality. Specifically:
    Developing strategic and annual plans.--Senior leadership in the 
Department was involved in developing the four goals and twenty-two 
objectives set forth in our strategic plan. Program managers were 
heavily involved in developing performance plans for the Department's 
programs. Some of these program performance plans were updated versions 
of existing performance plans, but for other program managers this was 
the first time they had developed program performance plans.
    Revising or developing data collection systems.--Effectively 
reporting the Department's performance in achieving its Strategic Plan 
goals and objectives requires developing some new data systems and 
fixing old ones. Existing data systems need to be strengthened to 
ensure the Department receives high quality and timely data on its 
programs and their effects. Our efforts include:
  --Reviewing existing data collections, administrative record sharing, 
        questionnaires, etc. to align with performance indicators; and
  --Develop new collections. The new systems will seek to redirect data 
        collections toward gathering performance information of the 
        accomplishment of Department-wide and program goals.
      An example of a new collection is the planned survey to determine 
        the percentage of teachers and principals across the Nation who 
        are rated as very effective. This survey would establish the 
        baseline and be the sole source of data for this indicator 
        (indicator 25, objective 1.4).
    Assuring data quality.--To ensure the quality of performance 
indicator data, the Department is following a four-part improvement 
strategy.
  --Develop Department-wide standards for performance indicator 
        measurements.
  --Develop employee training in the application of the data standards 
        for performance measurement.
  --Monitor data quality.
  --Have managers attest to the reliability and validity of their 
        performance measures or submit plans for data improvement.
    Over the next year the Department will be strengthening its two 
major data performance indicator systems, one for the elementary and 
secondary education and a second for student aid. In addition, the 
Department plans on extending its independent evaluations to include 
management evaluations.
      full-time equivalent staff needed to conduct gpra activities
    Question. Do you have an estimate of the full-time equivalent staff 
needed to conduct GPRA activities?
    Answer. The Department views GPRA requirements as key elements of 
good management practice and does not have an estimate of the full-time 
equivalent (FTE) associated with GPRA activities. The core offices 
responsible for coordinating implementation are the Office of the Under 
Secretary (OUS) and the Office of Management (OM). However, managers 
and senior staff throughout the agency participate in at least some 
GPRA activities. As we move toward being a performance-driven agency, 
we fully expect all employees to be focused on performance and using 
performance information. Developing strategic plans, whether at the 
agency or office/program level, should be a standard management 
function for managers, not an add-on done only to comply with 
legislation.
    Question. What administrative activities, if any, have been 
curtailed or eliminated to undertake GPRA?
    Answer. GPRA and the Department's Strategic Plan have provided the 
Department with a framework and a focus for its activities. It has 
required additional effort on the part of staff, but we are not aware 
of any activities that have been curtailed or eliminated during our 
implementation of GPRA.

                          subcommittee recess

    Senator Specter. The subcommittee will stand in recess to 
reconvene at 2 p.m., Tuesday, March 10 in room SD-192. At that 
time we will hear testimony from the Secretary of Health and 
Human Services, Hon. Donna Shalala, and from Hon. Nancy Ann 
DeParle, Administrator, Health Care Financing Administration.
    We are going to proceed now to panel 2, but I would like 
you to stay for just a moment, Mr. Secretary.
    [Whereupon, at 3:25 p.m., Thursday, March 5, the 
subcommittee was recessed, to reconvene at 2 p.m., Tuesday, 
March 10.]


  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1999

                              ----------                              


                        TUESDAY, MARCH 10, 1998

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Arlen Specter (chairman) 
presiding.
    Present: Senators Specter, Cochran, Gorton, Gregg, 
Faircloth, Bumpers, and Kohl.

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

                        Office of the Secretary

STATEMENT OF HON. DONNA SHALALA, SECRETARY

                  Health Care Financing Administration

STATEMENT OF NANCY-ANN MIN DePARLE, ADMINISTRATOR

                   opening remarks of senator specter

    Senator Specter. Good afternoon, ladies and gentlemen. The 
hour of 2 o'clock has arrived.
    Senator Gorton and I were talking on the subway on the way 
over, after we left our caucus a little early, that we wanted 
to be on time. We have the distinguished Secretary of Health 
and Human Services.
    Today the Subcommittee on Labor, Health and Human Services, 
and Education continues our hearings. The Department of Health 
and Human Services has become even more important than its 
former lofty position of importance as health care has emerged 
as an issue which is second to none in controversy and 
importance in America. Health spending constitutes about $1 
trillion, or one-seventh of our gross national product. 
Enormous changes have occurred in the health care field, since 
the President's plan came forward in 1993, and while not 
accepted, it stimulated enormous debate and there have been 
enormous changes in health care delivery. This Department is at 
the center of all of these changes.
    One of the concerns which our subcommittee and the entire 
Congress has is where we find the funding for the President's 
programs. And there is a gap of $1.9 billion, as the chart to 
my right shows, which comes from user fees which are not yet 
authorized and from projected settlements which are highly, 
highly speculative at this time.

                           prepared statement

    The Senators are still in their caucuses. Most of my 
colleagues are still in their caucuses. And I expect we will 
have very substantial representation before the hearing is 
over. And there are quite a number of topics which we will need 
to cover in the dialog, the Q&A. So I am going to put my full 
statement in the record and ask you at this time to proceed 
Secretary Shalala.
    [The statement follows:]

              Prepared Statement of Senator Arlen Specter

    Today we will continue the fiscal year 1999 hearings of the 
Subcommittee on Labor, Health and Human Services and Education. 
This afternoon, we are delighted to have before the 
subcommittee the distinguished Secretary of Health and Human 
Services, the Honorable Donna Shalala, and welcome her once 
again to our hearing.
    Madam Secretary, your department is charged with a 
formidable task: overseeing over $380 billion in entitlement 
and discretionary programs that Congress appropriates to your 
department for meeting the health and human service needs of 
the nation.
    You can see from the chart to my right the difficulty 
facing this subcommittee by the President's assumption that 
savings will be realized through enactment of user fees or new 
taxes.
    In fiscal year 1997, discretionary spending for this 
subcommittee totaled $74.7 billion.
    In fiscal year 1998, discretionary spending increased to a 
total of $80.4 billion.
    For fiscal year 1999, the President has requested $84.5 
billion, but $1.9 billion of this amount would be financed by 
new user fees and assumed receipts from tobacco legislation.
    Madam Secretary, the administration's budget request has 
put us in a real spot, basically $1.9 billion in the hole, and 
I fully expect that you will work closely with this committee 
as we try to resolve this dilemma.
    We will be taking a careful look at your budget 
recommendations, with their implications for the future health 
and well-being of our citizens.
    One of the top priorities will be expanding biomedical 
research. A fair target is to double NIH's budget over five 
years. Last year we made good progress toward that goal and I, 
along with Senator Harkin, will again work this year to improve 
that record.
    Following Secretary Shalala's panel, we will have a second 
panel with the Administrator of HCFA that will discuss 
important issues regarding physician reimbursement policies 
under medicare.
    We face difficult tradeoffs in the coming months, Madam 
Secretary. I look forward to working with you to craft an 
appropriations bill that maintains the commitment to fiscal 
restraint while preserving funding for high priority programs 
like NIH.
    I will now turn to Senator Harkin for any comments or 
opening statements that he may wish to make.

                summary statement of hon. donna shalala

    Secretary Shalala. Thank you, Mr. Chairman. I am pleased to 
be here.
    I have a few words at the beginning of my testimony, in 
tribute to Senator Bumpers, but I think I will wait for his 
appearance here before I make my statement.
    Senator Specter. Well, I think anything good about Senator 
Bumpers ought to be said behind his back. [Laughter.]
    Of course.
    Secretary Shalala. Mr. Chairman, I am pleased to appear 
before you today to discuss the President's fiscal year 1999 
budget for the Department of Health and Human Services. Last 
year we spoke at great length about the need to balance the 
budget. The President's 1999 budget achieves that goal, thanks 
to extensive cooperation between the Congress and the 
administration last year. We proved that by working together, 
working out innovative solutions, and working every dollar 
harder, we can guarantee a better fiscal future.
    And the President's new budget for the Department of Health 
and Human Services provides that, with fiscal discipline, we 
can address the needs of America's families in the context of a 
balanced budget. Let me just touch on the highlights, beginning 
with our three new initiatives.
    Last month, the President announced the 21st century 
research fund, to launch a new era of path-breaking scientific 
inquiry. HHS will play the largest role, with new resources for 
our constellation of stellar research agencies: the Centers for 
Disease Control and Prevention, the Agency for Health Care 
Policy and Research, and the National Institutes of Health. 
Indeed, the NIH will receive its single largest budget increase 
in its history, $1.1 billion, next year, a down payment on an 
historic 5-year, 50 percent expansion.
    The new resources will allow NIH, CDC, and AHCPR to attack 
our most defiant diseases in a coordinated, integrated way, and 
to speed research results from labs into clinics and hospitals. 
We also propose giving every Medicare patient the chance to 
participate in a cancer clinical trial, so each can benefit and 
perhaps benefit others.
    The second new initiative in this budget is the President's 
child care initiative. In millions of families, both parents 
must work to support their children. In millions of other 
families, single parents work doubly hard to support their 
children. The President's child care initiative will help 
families find and afford the quality child care they need. It 
includes $24 billion over 5 years in block grants to States, 
tax credits for families, tax incentives to businesses, and 
resources to help States enforce child care quality standards.
    This budget also advances the President's commitment to 
bring 1 million children into Head Start by the year 2000, and 
more infants and toddlers into early Head Start.
    The third new initiative in this budget is the Medicare 
buy-in plan. It answers the question troubling millions of 
aging Americans: What if I lose my health coverage before I am 
65? The buy-in plan would allow those age 55 and over to 
breathe a little easier.
    In addition to these new initiatives, this budget advances 
the fight against our most pressing public health challenges, 
requesting $165 million new dollars for Ryan White treatment 
activities for HIV and AIDS, $200 million new dollars for the 
substance abuse performance partnership block grant to help 
States and communications strengthen their control and 
treatment efforts, and $200 million new dollars to fight 
tobacco's impact on public health and to keep it out of 
children's hands.
    Mr. Chairman, this budget also focuses new attention and 
resources on the challenge of ensuring the safety of our food. 
Each year, millions of Americans get sick from food-borne 
diseases. Some die. I have heard a great deal about the food 
safety challenge yesterday, when I attended the CDC's 
International Conference on Infectious Diseases in Atlanta. The 
problems are new and varied. There are new food-borne microbes. 
Americans are eating more food prepared outside the home. And, 
ironically, healthier diets often mean Americans are eating 
more imported fruits and vegetables that need careful washing 
or preparation.
    This budget will help protect Americans from food-borne 
illnesses, with a $55 million increase in food safety efforts 
by both the FDA and the CDC. This increase will expand our new 
national early-warning surveillance system for monitoring, 
detecting, and stopping outbreaks of food-borne illnesses. It 
will also further improve seafood inspections and boost the 
President's initiative to ensure the safety of imported 
produce.
    Mr. Chairman, let me also take this opportunity to voice 
the President's strong desire to work with the Congress to 
protect our children from tobacco. To do that, we must have 
comprehensive, not piecemeal, tobacco control legislation that 
includes the President's five principles, including a very 
large price increase.
    As we advance our public health promises, the President's 
budget for the first time addresses the serious inequities in 
health services and health status for minorities. This budget 
includes $80 million to address several areas of disparity: 
diabetes, infant mortality, breast and cervical cancer, heart 
disease and stroke, HIV/AIDS, and child and adult immunization. 
We must correct these disparities so that all Americans have 
equal opportunities for healthy futures.
    Finally, Mr. Chairman, I am proud of how this budget makes 
every dollar work harder. First, there is no better investment 
than busting fraud. Last year, our inspector general's 
crackdown on Medicare fraud returned almost $1 billion to the 
Medicare trust fund. Our new budget includes another $138 
million to fight fraud. Moreover, we are offering new fraud-
busting legislation that would return another $2.4 billion to 
Medicare.
    In addition to fraud busting, we are proposing $264.5 
million in new user fees. Not only are these user fees smart 
Government, they are also crucial for HCFA to meet its 
obligations under the balanced budget agreement, and the Health 
Insurance Portability and Accountability Act. Speaking of smart 
Government, we sent you our first GPRA annual performance 
plans, which we developed in collaboration with Congress, 
States, local and tribal governments, as well as private 
partners. To us, GPRA is more than an acronym. It is a way to 
ensure that the line items in our budget truly bring America's 
promise to all Americans.

                           prepared statement

    Mr. Chairman, Senator Kohl, I believe this is a historic 
budget for HHS which launches a new era for health and social 
policy at the Department. It proves that with innovation and 
discipline, we can take strong steps for family and fiscal 
health and well-being. We have accomplished a lot together. I 
would be happy to address any questions you may have.
    [The statement follows:]
              Prepared Statement of Hon. Donna E. Shalala
    Good afternoon, Chairman Specter, Senator Harkin, and members of 
the Subcommittee. I am pleased to appear before you today to discuss 
the President's fiscal year 1999 budget for the Department of Health 
and Human Services.
                          balancing the budget
    Last year we spoke at great length about the need to balance the 
budget. I am pleased to inform you that the President's 1999 budget 
achieves that goal. But we were able to meet this challenge only 
because of the extensive cooperation between the Congress and the 
Administration last year. We proved that by working together, seeking 
innovative solutions, and squeezing every dollar from our budget, we 
can put our fiscal house in order. Emerson once said that ``success is 
leaving the world a bit better than you found it.'' We have left the 
budget much better than we found it and in doing so we have provided 
our children with a path to a better fiscal future. This budget proves 
that we can take on new initiatives in the context of a balanced 
budget--if we are innovative and disciplined. I am very proud of our 
collective accomplishment, and I'm sure each of you shares my pride.
    Because of our success in achieving a balanced budget, we can now 
turn renewed attention to the pressing problems of tomorrow: 
strengthening the public health and human services, continuing strong 
fiscal management and preparing for the 21st Century.
                     preparing for the 21st century
    This is the last budget we will prepare for this millennium, and it 
sets forth the priorities for the next century, ranging from major 
increases in health research to promising child care for a million 
additional children to ending the scourge of youth tobacco use.
The 21st century research fund
    The President announced the 21st Century Research Fund to launch a 
new era of path-breaking scientific inquiry. HHS will play the largest 
role, with new resources for our constellation of stellar research 
agencies--including the National Institutes of Health (NIH), the 
Centers for Disease Control and Prevention (CDC), and the Agency for 
Health Care Policy and Research.
    First, the 21st Century Research Fund provides the resources 
necessary to combat cancer, heart disease, diabetes, AIDS, Alzheimer's, 
cancer, Parkinson's, Hepatitis C and other diseases. The President's 
budget includes an additional $1.2 billion increase to put us on a path 
to double our investment in medical knowledge, bridge the gap between 
scientific knowledge and health care delivery and prevent the spread of 
disease. By increasing by nearly 50 percent over five years our 
nation's commitment to NIH at the same time that we increase our 
commitment to CDC and AHCPR, this fund provides the resources necessary 
to achieve a better integrated system of health research.
    We believe that a coordinated system of health research is the best 
way to achieve significant results in battling complicated diseases. We 
must continue to coordinate the efforts of NIH, CDC and AHCPR to attack 
these serious health threats.
    To make our investment worthwhile, we must move our research from 
the laboratories into the clinics and hospitals. To illustrate this 
point, consider diabetes. Untreated diabetes is the sixth leading cause 
of death from disease and the leading cause of adult blindness, kidney 
failure and non-traumatic amputations. It also is a risk factor for 
stroke and heart attack. It is estimated that thirty-three percent of 
people with diabetes--over 8 million people--have gone undiagnosed. The 
incidence of diabetes is growing in the American population. Medical 
research alone will not cure this problem. In order to attack diabetes, 
we need the coordinated efforts of NIH, CDC, and AHCPR.
    NIH focuses basic research on the causes of diabetes, including the 
genetic ones, and researches possible new avenues for treatment. Yet, 
NIH cannot alleviate diabetes alone. We need CDC's efforts in 
identifying those with diabetes and persuading them to seek treatment 
and to educate physicians on how to better detect this disease. We also 
need AHCPR's research which focuses on finding the most economic and 
least intrusive methods to screen individuals for diabetes. Without the 
essential research of NIH and the prevention services of CDC and AHCPR 
we will not likely reduce the serious threat that diabetes poses to our 
society.
    The 21st Century Research Fund solidifies the foundation for a 
coordinated biomedical research system, providing $25 million for CDC's 
prevention research programs, increasing AHCPR's funding by $25 million 
in fiscal year 1999 alone, and setting the course to increase NIH 
funding by nearly half by 2003.
Cancer research and clinical trials
    Cancer has been one of the cruelest killers of this generation. The 
President's budget moves dramatically on this front. The NIH budget, 
for example, pays special attention to cancer research, increasing 
funding across NIH by 10 percent in 1999 and 65 percent by 2003. The 
President also seeks $750 million for a three year demonstration to 
enable Medicare patients to participate in cancer clinical trials. 
Medicare patients represent 50 percent of all cancer patients and are 
ten times more likely to get cancer. It is therefore appropriate to 
undertake this demonstration for those eligible for Medicare. This 
demonstration is fully financed by revenues which would result from 
passage of tobacco legislation.
    Vice President Gore has lead the Administration's effort to step up 
our fight against cancer, and I am personally grateful for his tireless 
efforts to achieve these historic increases for cancer research.
Child care
    We live in changing times. Families are not the same as they were 
30 years ago, the last time we balanced the budget. In millions of 
American families, both parents must work to support their children, 
and in millions of other families, single parents work doubly hard to 
support their children. Building on the Earned Income Tax Credit, the 
Child Tax Credit, the Family and Medical Leave Act, minimum wage 
increases and the new child health insurance program, the President's 
Child Care Initiative is another critical step in this Administration's 
commitment to our nation's families.
    Our fiscal year 1999 budget proposes new child care investments 
that will support parents' choices, so that they will be able to find 
and afford quality child care for their children while they work. It 
will answer their most troubling questions about child care: Can I get 
it? Can I afford it? And can I trust it for my children's safety and 
development?
    At the center of the President's Child Care Initiative is our 
proposal to expand the Child Care and Development Block Grant by $7.5 
billion over five years (an increase of $1.2 billion in fiscal year 
1999). This will provide funds to the states to serve over 2 million 
children by 2003.
    The budget also grants tax credits to 3 million working families 
for child care and tax incentives for businesses that provide child 
care for their workers. Moreover, this budget includes $3 billion over 
five years to improve the quality of child care by providing challenge 
grants distributed by states to communities to improve early childhood 
education and the quality and safety of child care for children under 
five years old. In addition, the budget includes $250 million for 
investing in the education of child care workers and $500 million to 
help states enforce child care standards, and $150 million for research 
and consumer education.
Head Start
    One of the President's top priorities has been and continues to be 
investing in Head Start. The President's budget contains $3.8 billion 
over five years. Because early investment in children gives them the 
best chance of continued success, by the year 2002 we will serve one 
million children in Head Start, including doubling to 80,000 the number 
of children 0-3 served by the Early Head Start Program.
Medicare buy-in
    Our Medicare buy-in program provides solutions to one of the most 
troubling problems our aging population faces: what happens if I lose 
my health coverage before I'm 65? The President's budget allows 
individuals aged 55 and over without access to health insurance to 
breathe a little easier. The budget proposes a three-pronged solution. 
First, it enables Americans ages 62 to 65 to buy into Medicare, through 
a premium designed so that the policy is self-financing. It also 
provides displaced workers who are ages 55 to 61 with an option to 
purchase Medicare. Finally, the President's proposal gives individuals 
who retired early and whose companies have reneged on their health 
benefits the option to buy into their former employers' health care.
              public health challenges of the 21st century
    Public Health services affect every single American every day of 
their life. From AIDS prevention and treatment to tobacco control for 
our youth, our fiscal year 1999 budget builds on and expands our 
commitment to programs that will make all Americans more health 
conscious and protect them from traditional and emerging threats to our 
public health.
Ryan White
    We have seen significant progress in the fight against HIV and 
AIDS. In the first half of 1997, AIDS deaths decreased by 44 percent. 
Nonetheless, more progress must be achieved. In 1997, the Department of 
Health and Human Services and the Henry K. Kaiser Family Foundation 
issued new guidelines for standardizing and improving the quality of 
care for HIV-infected persons. The quest to ensure access to new 
methods of treatment must continue. The President's budget addresses 
this issue and provides $1.3 billion, an increase of $165 million, for 
Ryan White treatment activities. The AIDS Drug Assistance Program 
(ADAP) will receive $100 million of this increase for helping 
individuals gain access to combination drug therapies consistent with 
the new guidelines.
Food Safety and Emerging Infectious Diseases
    The President's budget includes an additional $25 million for a 
combined effort by CDC to develop and expand national early warning 
systems for unsafe food and emerging infectious diseases. We must make 
certain that food-borne diseases don't affect our families. Similarly, 
we need to closely monitor infectious diseases. Our budget develops an 
effective national surveillance network and expands the geographic 
coverage of this early warning network to 30 states. The food safety 
initiative improves the quality and scope of food-borne disease 
surveillance in eight FoodNet sites, links the federal and state health 
laboratories with computer technology that will enhance data sharing, 
and provides training to detect food-borne diseases in exports from 
foreign countries, including Mexico and some Latin American countries. 
In addition, FDA is seeking $50 million to complement efforts in food 
safety.
Racial disparities
    We have already talked of the serious threat diabetes poses to 
Americans. Yet, there is another disturbing statistic associated with 
diabetes. Between 1980 and 1994, the number of African-Americans with 
diabetes rose 33 percent, 3 times the rate of increase for all other 
Americans. Native Americans also suffer from diabetes at extremely high 
rates. If we are to ensure a better future, we must find the answers to 
this disparity and correct this problem and the many other racial 
health disparities that exist. The President's budget includes $400 
million over five years as part of a broader initiative to find new 
targeted means of reducing the health disparities that persist among 
minorities. This money is intended to target health outcomes in six 
areas where minorities experience serious inequalities in health 
services and health status. These include: infant mortality, breast and 
cervical cancer, heart disease and stroke, diabetes, HIV/AIDS, and 
child and adult immunization. This effort will be Department-wide and 
will be coordinated by the Centers for Disease Control and Prevention 
and will be supplemented by a host of non-budget activities that 
involve the community and experts in this area to help solve this 
urgent problem.
Substance abuse
    We must continue our efforts at all levels of government and in the 
private sector to eliminate substance abuse. Consequently, the 
President's fiscal year 1999 budget provides an additional $200 million 
in funds for the Substance Abuse Performance Partnership Block Grant. A 
total of $1.5 billion will enable states and local communities to 
enhance their treatment capacity and continue efforts to control and 
treat substance abuse. We also are concentrating our research efforts 
in the biological basis of addiction, enhancing prevention techniques, 
and assessing prevention intervention approaches. With a coordinated 
effort, we can end this destructive plague.
Tobacco
    Our budget request reflects the strong commitment of this 
Administration and all Americans to ending the tragic and destructive 
use of tobacco products by children and teenagers. We also are 
committed to finding the most effective methods for adults who want to 
quit the addiction that tobacco use creates. For example, CDC and FDA 
tobacco education and control programs will receive $200 million from 
the President's budget proposal. CDC will direct a total of $51 million 
to fund state-based prevention and control activities, including: 
training and programmatic support for school-based smoking cessation 
programs; national surveillance activities; state prevention and 
control plans to protect nonsmokers from exposure to environmental 
smoke; and state programs to address oral cancer.
    The President has made clear his strong desire to work with the 
Congress to protect our children from the disease and death caused by 
tobacco use. To do that, we must have comprehensive legislation. Five 
key elements must be included in such legislation: (1) a significant 
price increase to reduce teen smoking, including tough penalties if 
targets are not met; (2) full authority for FDA to regulate tobacco 
products; (3) changes in the way the tobacco industry does business; 
(4) progress toward other public health goals; and (5) protection for 
tobacco farmers and their communities. The President has called for 
tobacco legislation that will raise the price of cigarettes by up to 
$1.50 per pack over ten years and curtail tobacco use among youth. We 
estimate that the President's budget proposal, coupled with sales and 
advertising restrictions, would reduce underage tobacco use by 39 
percent to 46 percent in 2003 and spare almost one million of today's 
young people from the premature deaths related to tobacco use.
                innovative program and fiscal management
    In describing our budget, we must not forget that this committee 
played a major role in achieving balanced budget savings. It is 
important to note that our Department played a significant role, as 
well, in balancing the budget and will contribute $150 billion over the 
next five years in Medicare and Medicaid savings. After all, at HHS, we 
believe in responsible, innovative management. In this budget, we have 
developed innovative solutions to squeeze every ounce of productivity 
from our taxpayer dollars. We also intend to add additional non-federal 
resources to meet our program obligations in the years ahead. We need 
your support for new legislation on many of these proposals. We will 
work closely with the Congress and this subcommittee to enact this 
necessary legislation.
Fraud-busting
    While I have just mentioned future management efforts, I would like 
to mention briefly one of our most recent success stories. It's no 
secret--it's called fraud-busting. In 1997 alone, thanks to the 
outstanding efforts of the Office of the Inspector General, we returned 
almost $1 billion to the Medicare Trust Fund in our aggressive pursuit 
of those organizations and individuals who steal from the Medicare 
system. When you steal from the Medicare system, you steal from our 
most vulnerable citizens and we will not tolerate it. New HCFA 
legislation that we are offering will return an additional $2.4 billion 
in savings to the Medicare system. We also are proposing a new audit 
user fee within the Medicare Integrity Program (MIP) that will allow us 
to double our audit and medical review spending.
    The Administration on Aging (AoA), with its vast network of state 
and area agencies on aging and community-based services, is another 
partner in the long-term federal effort to fight and prevent fraud and 
abuse in the Medicare and Medicaid programs. AoA uses the funds 
allocated under the Health Insurance Portability and Accountability Act 
(HIPAA) to train and educate both paid and volunteer staff in the aging 
network. The results are in--fraud-busting is a smart investment.
User fees
    With the passage of Balanced Budget Act (BBA) and HIPAA, the Health 
Care Financing Administration (HCFA) has acquired substantial new 
responsibilities. Without adequate resources these responsibilities 
simply cannot be accomplished. Given the tight limitations of the BBA, 
we have sought out alternative fiscal resources. We have proposed 
$264.5 million in new user fees for services that we furnish our 
nation's health care providers. I ask the Congress to enact these 
essential user fees. Our proposed user fees provide for more efficient 
administration of the Medicare program while allowing greater control 
against fraud, waste and abuse. Without such fees, HCFA's ability to 
implement the BBA and HIPAA requirements would be hindered. Our total 
program level, including user fees, would allow us to implement the new 
legislative requirements and help ensure millennium compliance of 
internal and external computer systems.
Government Performance and Results Act (GPRA)
    The budget we have presented highlights the incremental changes 
that HHS is proposing through its programs. Along with the fiscal year 
1999 budget, we also sent to you our first GPRA annual performance 
plans. These plans focus on the Department's stewardship of all of the 
resources entrusted to HHS. Our performance plans have been developed 
in partnership with the states, local and tribal governments, and non-
governmental partners who use these resources efficiently.
    For example, to help improve health outcomes for individuals in 
need, particularly children, we have set a performance goal for 
community health centers to serve an additional 150,000 uninsured and 
under-served persons in fiscal year 1999.
    Similarly, we plan in fiscal year 1999 to increase to 59 percent 
the proportion of Medicare beneficiaries age 65 and older who will have 
received a screening mammogram in a 2-year period. As you know, a 
mammogram is a safe, effective means of detecting breast cancer at an 
early and treatable stage. This common-sense goal will lead to improved 
health outcomes for Medicare beneficiaries and avoid the financing of 
unnecessary, high-cost medical services.
    These are brief illustrations of the results that HHS and its 
partners want to achieve through all of our programs, but they are 
representative of the goals presented throughout our performance plans 
for fiscal year 1999. In the coming years, we believe that the focus on 
results that is fostered by GPRA will enable us to improve our ability 
to match the most effective forms of service delivery with populations 
that have the greatest need. GPRA will be an ongoing process. It is 
neither a quick management fix nor a vague management plan. It can and 
will work to improve our programs as long as there is a clear and 
continuing cooperation between the executive and legislative branches 
on the means to improve programs once the GPRA results are in.
    We have proposed our blueprint for the next millennium and I 
believe it is an excellent drawing.
                               conclusion
    Mr. Chairman, we share many common goals in this budget. Most 
importantly, our concern for a balanced budget continues. We share the 
common goal of the best health research program ever. We want to end 
the tragedy of underage tobacco use. We want to expand safe, 
affordable, high quality child care to another million children. We 
want to sustain our commitment to Head Start. We want to improve food 
safety and curb emerging infectious diseases. And, we most assuredly 
want to maintain a vigorous attack on health care fraud.
    Chairman Specter, Senator Harkin and members of the subcommittee: I 
want to join you in meeting the health and human resource challenges 
before us in this budget. We have much to accomplish together. I would 
be happy to address any questions you may have.

                       tribute to Senator Bumpers

    Secretary Shalala. Mr. Chairman, with your permission, 
rather than speaking behind his back, I would like to make a 
few comments about a departing Senator.
    Senator Specter. We would be delighted to hear your 
comments as to our distinguished colleague, Senator Bumpers.
    Senator Bumpers. You have the rest of the afternoon, Madam 
Secretary. [Laughter.]
    Senator Specter. Madam Secretary, he is right to cite the 
timing. I think you have about 40 seconds left. [Laughter.]
    Secretary Shalala. Mr. Chairman, before I begin to answer 
questions, I would like to pay tribute to a beloved and highly 
respected member of this subcommittee, a man who the National 
Journal has called a ``Senator to whom other Senators pay 
attention,'' Senator Dale Bumpers of Arkansas.
    I am fortunate to count Senator Bumpers as my friend and a 
true supporter of Government's role to help those who need 
help: our children, our seniors, and the disabled. Senator 
Bumpers and his wife, Betty, have vividly demonstrated over so 
many years devotion, to child immunization. He recently stood 
up for David Satcher in his nomination to be Surgeon General. 
When I look across the span of Senator Bumpers' quarter century 
of public service, I am reminded of the words of the poet Maya 
Angelou, who grew up in Arkansas: ``If you are for the right 
things,'' she said, ``then you could do it without thinking.''
    Senator Bumpers has always been among the most thoughtful 
Members of the Senate. Doing the right thing clearly has been 
second nature to him. Last fall, in paying tribute to the 
Little Rock Nine, Senator Bumpers said: ``Sometimes we worry 
that there are no heroes in our country today, no one for our 
children to look up to, no one to inspire us to be our best 
selves.'' Well, when we see Senator Bumpers, we know there are 
heroes in our country today, leaders to inspire our children, 
all of us, and our better selves. Thank you, Senator Bumpers, 
from all of us.
    Senator Bumpers. Donna, thank you very much.
    Thank you, Mr. Chairman.

                           two HCFA concerns

    Senator Specter. Madam Secretary, there are a great many 
subjects that I want to take up with you today--the gap in 
funding which we have to find an answer to--but perhaps the 
most important issue which faces this subcommittee, perhaps the 
country, on the question of health care is the destruction of 
the doctor-patient relationship. And that is something which 
has been emphasized by the President. I know it has been 
something you have articulated. It is something that is 
obviously extraordinarily fundamental in our society. And it is 
rock bed on health care.
    But we see disintegration of that relationship, as there 
are so many intervenors, people between the doctor and the 
patient. That has come up with the gag rule, where we had 
hearings on November 13, 1996, and finally got some HCFA 
changes. It came up as we legislated on drive-by deliveries, 
where the Congress got into the business of micromanaging 
medical decisions. Legislation is pending on drive-by 
mastectomies. There is a capitation issue, where doctors are 
motivated to not refer to specialists. And one item of great 
importance that I had written to you about on two occasions.
    On November 25, I wrote to you about the issue of EPO. I 
got back what I consider to be a pretty perfunctory letter from 
Administrator Nancy-Ann Min DeParle. She will be before us 
later today. And then I wrote to you with some great 
specification about that issue earlier this month. I had called 
you last week about it. And I know you returned the call a 
little before 1 o'clock today; we were in our conference.
    But in Administrator DeParle's letter, she said that in 
September, based on concerns about evidence that such physician 
justifications were being routinely submitted, resulting in 
overutilization of EPO, we decided to eliminate this exception 
from our coverage policy. Today I received a letter dated March 
9, yesterday, from Chairman Archer, of Ways and Means; and 
chairman of the subcommittee, Thomas; and the ranking member, 
Peter Stark, raising the same issue about the drug EPO with the 
Health Care Financing Administration.
    And I have two points that I would like your responses on 
the specifics here, that there is an urgent necessity to have a 
broader use of this drug and, second, the disregard of 
physician justifications.
    Secretary Shalala. Let me answer both parts of your 
question. We share Congress' concern about interference in 
physicians' judgment in evidence-based health care, which is 
where we want the health care system to go. In the President's 
support of the consumer bill of rights proposed by the 
Commission that I chair are a set of rules for which we hope 
there will be bipartisan support. They make orderly access to 
physicians, access to information people need in their health 
care system, help people understand what their appeal rights 
are, and ensure that people have access to emergency rooms when 
they are needed.
    On the specific question of the provision of Epogen [EPO] 
to dialysis patients, we are going to revise the EPO policy as 
of April 1. I am sorry that we did not connect earlier on the 
phone, but let me announce it here to you. Under the revised 
policy, with which I think that those who have raised an issue 
about this policy will be pleased, we will replace the current 
full denial for exceeding the thresholds with a partial denial. 
I can go into that in some detail or provide it for the record.

                        reduction in EPO dosage

    We agree that the revised policy needs to create incentives 
for a gradual reduction in EPO dosage if the patient is above 
the target range, consistent with the appropriate medical 
practice and FDA recommendations. And I think that this 
revision, as of April 1, will satisfy the concerns that you, 
other Members of Congress, and members of the medical community 
have raised to me.
    Senator Specter. Well, I think this is important enough to 
take it up in some detail. The level for reimbursement was 
changed from a single monthly fixed limit to a rolling average 
over a 3-month period of 36.5 percent. And that percentage was 
viewed by the physicians as being too low because of the 
hematocrit variability of each patient. The nephrologists have 
made generalized complaints from all over the country that the 
36.5-percent level needs to be raised for the natural 
fluctuation of the patient's hematocrit.
    The technical information that has been provided to me 
requires that there be a number of changes. First, to reinstate 
the medical justification, to allow for physician discretion 
for selected patients, as needed, raising the hematocrit to at 
least 37.5, and replacing HCFA's current practice of total 
reimbursement denial with a partial denial. And my question to 
you specifically is, are all three of those items addressed on 
the change of policy as of April 1?
    Secretary Shalala. I believe they are. Nancy-Ann Min 
DeParle can answer that in more detail when she testifies after 
me. But if you would like me to march through what we are going 
to do, I would be happy to do that.
    Senator Specter. What I would like you to do is to respond 
to these three elements which have been raised to me.
    Secretary Shalala. OK.
    Senator Specter. Is Ms. DeParle here? Let her come join us 
now. And let us resolve this issue.
    Secretary Shalala. She comes at 3 o'clock. But we could do 
it at the end of this session, and we can call her and ask her 
to come up right now, if you would like that.
    Senator Specter. OK. Let us do that.
    Secretary Shalala. And if we could have the three 
questions, then we will answer them on the record for you 
before the hearing is completed.
    Senator Specter. OK, we will await her arrival.
    But before she comes, why April 1? Why not March 10 or 
March 1?
    Secretary Shalala. Well, it is going to take us a few 
months to modify our computer systems. And we are making the 
policy effective for services provided on or after April 1. I 
think this is probably a notification question, and we will 
check with Ms. DeParle, again, on that question.
    Senator Specter. Will you have somebody check that out? You 
say probably a notification question, maybe yes, maybe no?
    Secretary Shalala. It may be a notification question, but 
let me ask the question so I can give you an accurate answer.
    Senator Specter. Let us find out about that. And let us 
find out about the computerization. Because a lot of people are 
suffering every day, from the avalanche of complaints which I 
have heard.
    Secretary Shalala. Well, we will make payment adjustments 
retrospective to April 1. So while it takes a few months to 
modify the computer systems to reflect the new policy, the 
policy will be effective for services provided on or after 
April 1. We will make payment adjustments retrospective to that 
date.
    Senator Specter. That is 21 days away.
    Secretary Shalala. That is right.
    Senator Specter. I would like to have it today.
    Secretary Shalala. Let me have the Administrator answer 
that question.
    Senator Specter. Well, let us see if we can find a way to 
do it effective today.
    Senator Kohl.

                      Federal After-school program

    Senator Kohl. Thank you very much, Senator Specter.
    And, Madam Secretary, it is good to see you. And we 
appreciate your coming down to talk to us.
    Secretary Shalala, one part of the President's budget that 
I am interested in is a demonstration project run by the 
Education, Health and Human Services, and Justice Departments 
that would coordinate Federal after-school programs. I 
understand that this initiative is to designate three to five 
pilot cities, and show how they can coordinate all the various 
government programs that serve children after school.
    I have three inquiries. No. 1, how do you intend to ensure 
that these programs are educational and not just custodial? No. 
2, how are these pilot cities to be chosen? And, No. 3, can I 
request that my home city of Milwaukee be seriously considered?
    Secretary Shalala. You certainly can request that any city 
in Wisconsin be seriously considered.
    The answer to your questions about our selection process 
and the coordination, I will have to provide for the record.
    [The information follows:]

                         Child Care Initiative

    The initiative you are referring to was part of the Child 
Care Initiative announced by the President on January 7, 1998. 
The President announced at that time a collaborative effort 
involving numerous federal agencies to eliminate duplication 
and better coordinate existing federal funding for after-school 
programs in three to five pilot cities, including the District 
of Columbia. A working group within the Administration has been 
formed to put this collaborative effort in motion. It comprises 
representatives from HHS, Department of Education, the Justice 
Department, as well as other interested federal agencies. This 
working group will be looking at previous collaborative efforts 
to gain some lessons learned as criteria is developed for 
considering other cities that may be included as part of this 
effort. The key goal of this initiative is healthy development 
and learning, and not custodial. I will communicate to the 
working group your interest to have Milwaukee be considered as 
one of the possible sites and your concern that this effort not 
be focused on custodial issues.

                         After-school programs

    Secretary Shalala. But let me make a substantive point 
about what is expected. We obviously want an educational 
component in after-school programs. But there really is a 
difference between dealing with after-school programs for young 
children and for older children. One of the ways to keep 
adolescents in after-school programs is to give them some 
choices--certainly getting their homework done--which have an 
educational component, perhaps combined with something else.
    What has been cut out of schools in this country are 
extracurricular activities, for example, sports after school. 
We would suggest some choices for young people which include an 
educational component, but also make an investment in their 
health and exercise and all the other things that will keep 
them emotionally and physically healthy in an integrated manner 
to certainly make a difference.
    The point, I think, of the demonstration is to make sure 
that communications have a strategy, so that no child is left 
out from these kind of choices, particularly for adolescents, 
and make sure communications use schools and boys and girls 
clubs and other kinds of organizations as part of this 
strategy, so that no child is left without a program, so that 
no parent is left without a program. Parents should identify 
what is convenient for them, and what that can occupy usefully 
and have an educational component for their child after school.
    Senator Kohl. All right. Thank you.

                              Elder abuse

    Madam Secretary, last year the Milwaukee Journal Sentinel 
ran a series of articles, focusing on the prevalence of elder 
abuse by health care workers, many of whom had prior criminal 
backgrounds. Similar stories have appeared nationwide, and 
abuse is not isolated just to nursing homes.
    To respond, I have introduced and continue to work on 
legislation that would create a national registry of abusive 
long-term care workers, and require criminal background checks 
for prospective employees of long-term care facilities. This, 
hopefully, will make sure that abusers cannot travel from State 
to State and continue to prey on vulnerable patients.
    Would you, Madam Secretary, support such a proposal and 
work with me to push for it this year? And would you help me 
move this along this year by also looking for a way to perhaps 
do this administratively?
    Secretary Shalala. Well, we certainly will work with you on 
anything that will strengthen our ability to reduce elder abuse 
in this country, and anything that will hold in particular the 
States' feet to the fire on doing the survey and certifications 
and make sure that they are regularly providing oversight for 
nursing homes and home care settings. We have already published 
regulations in this area. Obviously, there is still abuse going 
on in this country. So we would be pleased to have a 
conversation with you about what you are proposing.
    Senator Kohl. Well, unless you have something like a 
national registry, there is no way for facilities from one 
State to another to know what occurred in another State with 
respect to employees and abusive behavior. That is what a 
national registry would provide for long-term care facility 
operators. And our bill would provide for that national 
registry. And it is your opinion on that, the advisability and 
the desirability of that, that I am interested in.
    Secretary Shalala. What I would want to do is to look at 
the actual proposal itself and the administrative costs that 
are tied into it. But, in principle, we want to support 
anything that can strengthen the oversight of nursing homes in 
this country.
    Senator Kohl. All right. I thank you.

                   President's child care initiative

    Last question: The President's $20 billion child care 
proposal contains over $5 billion in spending that goes through 
this subcommittee, spending for programs like teacher 
scholarships, child care facility inspections, and after-school 
programs. Now, currently, that money is considered outside of 
our spending caps, and the President has suggested paying for 
it with part of the revenues from a new cigarette tax bill. 
Will the administration still stand by its child care proposal 
if we are unable to reach agreement on a new tobacco tax?
    Secretary Shalala. First, we believe that there is 
bipartisan support for a price increase and a comprehensive 
strategy to reduce children smoking in this country. So we 
believe that what the President has identified as a source of 
funds for the child care initiative will, in fact, be 
available. But, yes, the President, in all of his top 
priorities, will work with the committee, or appropriate 
committees, to find a source of funds if for some reason the 
source of funds we have identified does not come through. We 
have been willing to do that in the past and we certainly would 
be willing here.

                           prepared statement

    Let me add that your assumption that any of the President's 
proposals breaks the cap is not consistent with the way we have 
presented the budget. The President believes he has presented a 
budget that is paid for. He has identified sources of revenues. 
And we believe that is within the context of the balanced 
budget commitment which we all made last year.
    Senator Kohl. Thank you, Madam Secretary.
    Senator Specter. Thank you, Senator Kohl.
    [The statement follows:]

                Prepared Statement of Senator Herb Kohl

    Thank you, Mr. Chairman. Secretary Shalala, it's good to 
see you again, and I look forward to your testimony today.
    This is a unique time in our nation where we have tight 
budget constraints and tremendous opportunities at the same 
time. Last year, we passed the Balanced Budget Act, which 
wisely requires Congress to comply with spending caps in order 
to get rid of the deficits of the past three decades. But we 
also have a strong economy, the deficits of the past are all 
but gone, and both OMB and CBO are projecting surpluses for the 
next several years. Many people in our country are doing well--
it is now time to focus on those who are not, and give them the 
tools to live productive, safe and successful lives.
    I am pleased that the President's budget has taken 
advantage of these prosperous times by placing a high priority 
on child care programs. Both the public and private sectors 
must get involved in seeing that we have enough child care for 
working parents. The President's budget includes a proposal, 
which I have worked on for several years, to provide a tax 
credit to businesses who help their employees find quality 
child care. This benefits not only families, but businesses as 
well, as it will help reduce absenteeism and increase 
productivity. I look forward to working with the Administration 
to make this and other child care proposals a top priority.
    On the other end of the age spectrum, we must take a close 
look at the issue of how well we protect our elderly once they 
require long-term care arrangements. With 43 percent of 
Americans over the age of 65 likely to spend time in a nursing 
home, and the increasing utilization of home care arrangements, 
we have to make sure that facilities are safe and provide the 
best care possible. I have introduced legislation that would 
require background checks of long-term care workers, and I look 
forward to working with the Administration on other efforts to 
protect our nation's elderly and frail patients.
    Again, I thank you, Secretary Shalala, for coming here 
today to address the question of how we can strengthen our 
investment in programs for our most vulnerable populations 
while still complying with the budget constraints required to 
keep the budget in balance.

                        Patients' bill of rights

    Senator Specter. We will proceed in order of arrival. 
Senator Bumpers is next.
    Senator Bumpers. Thank you, Mr. Chairman.
    Madam Secretary, let me thank you again most profoundly and 
sincerely for your very kind, laudatory remarks, all of which 
are true, and more. [Laughter.]
    I am reminded of the widow, at her husband's funeral. The 
preacher just kept going on and on about what a great citizen 
he was. Finally she leaned over to one of her children and 
said, honey, you go up and look in that casket and make sure 
that is your daddy they are talking about. [Laughter.]
    I listened to the President's speech to the AMA on NPR last 
night on the way home. And every time he mentioned the 
patients' bill of rights he got the loudest applause. That 
coming from the AMA. And the applause is even louder, of 
course, when he is speaking to lay groups.
    But while there is a House bill dealing with the so-called 
patients' bill of rights, as far as I know, there is nothing 
pending in the Senate. Is the administration preparing a bill 
to be introduced in the Senate on this subject?
    Secretary Shalala. We have not sent a bill to the Senate. 
But we have sent a lot of detail to the Senate, including 
technical assistance on legislative language. It is not very 
complicated to provide technical assistance on legislative 
language. But we have sent up the specifics as a result of the 
commission which I chair with the Secretary of Labor. So we 
have articulated areas in which the President would like 
legislation as well as have provided technical assistance on 
the legislative language.
    Senator Bumpers. Well, people obviously have a very strong 
feeling that they are not only being neglected, but that their 
health is often jeopardized by the lack of options, and some 
gatekeeper who says, no, you are not eligible for this. And the 
President, yesterday--I am sure you heard it, too--gave the 
illustration of the youngster whose leg ultimately had to be 
amputated because he could not get permission for the treatment 
that might have saved his leg. People hear too much of that.
    Of course, some of that is embellished. In the coffee shop 
you hear stories like that. And I must say, in the few times I 
have been hospitalized in the last few years--sometimes I guess 
it is just lack of care--you wonder if they treat Senators like 
that, what does the poor guy who just walks in off the street 
get? But that is often a matter of care in particular 
institutions as opposed to managed care and lack of choices.
    But I would like to see the Finance Committee, if the 
administration is not going to submit such a proposal, I would 
like to see the Finance Committee take the suggestions and some 
of the information that you are going to forward over here, and 
get on this. I would like to see this--as you pointed out, this 
is my last year--I would like very much to see something happen 
on that this year.
    And let me just conclude, Madam Secretary, by saying you 
have now been on this job for a little over 5--almost 5 years. 
And I would like to reciprocate by saying I think you have done 
an outstanding job.
    Secretary Shalala. Thank you, sir.
    Senator Bumpers. Most of my dealings with you have been in 
the immunization area. And that is small potatoes, moneywise, 
compared to the budget you administer. But your tenacity and 
your determination on causes that really make people's life 
better has been most admirable. And certainly I am one of your 
biggest fans also. And I will miss being associated with you 
after I leave here.
    Secretary Shalala. Thank you, Senator.
    Senator Bumpers. Thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Senator Bumpers.
    Senator Faircloth.

                           Nurse anesthetists

    Senator  Faircloth. Thank you, Mr. Chairman.
    And thank you, Secretary Shalala, for being with us today. 
And I thank you for your enthusiastic support of transferring 
some IRS agents to the drug control.
    Secretary Shalala. I apologize again, Senator.
    Senator  Faircloth. But I think it needs to be done. I 
think one is a bigger problem than the other. And I think that 
drugs are it.
    Madam Secretary, in December of last year, your group 
issued a proposed rule that would delete the current 
requirement that nurse anesthetists administer anesthesia only 
under the supervision of operating surgeons and 
anesthesiologists. Now, I have heard from a lot of individual 
groups of people who are raising a lot of concern about the 
effect of this and the quality of the service.
    Now, no one has greater respect for nurses and what they 
have done and what they mean to the medical profession than I 
do. Nurse midwives, nurse practitioners all come to mind. But I 
have a lot of concern about this change of rules. How can you 
document that this does not represent a compromise?
    Secretary Shalala. Senator, we actually are reinforcing 
State medical practice whatever the standard is in the State. 
Twenty-nine States actually allow that to take place. So in 
this case, the Department's rule reflects standard State 
medical practice since 29 States allow it. They are often 
States that have large rural populations, where they think this 
is an appropriate medical practice. So it is not as new or as 
dramatic a change, since so many States allow it.
    Senator  Faircloth. Well, the States besides, do you think 
it is an adequate way to do business?
    Secretary Shalala. Well, it is a proposed rule now. When we 
drafted the rule----
    Senator  Faircloth. Wait a minute now. What is the proposed 
rule?
    Secretary Shalala [continuing]. The proposed rule is to 
allow this to occur. And it has not in final----
    Senator  Faircloth. Well, we have not allowed it to occur 
before, is that right?
    Secretary Shalala [continuing]. Except in States where it 
is standard practice, which I indicated it was in 29 States.
    Senator Faircloth. But as I understand it, you are going to 
allow it in all States.
    Secretary Shalala. That is correct.
    Senator Faircloth. And that is what the problem is.
    Secretary Shalala. We are collecting comments now from 
individuals, organizations, and different States so we have not 
gone to the final rule. I do appreciate your comments on that.
    Senator  Faircloth. Well, I would be glad to give you 
comment. I think it is a terrible practice. And I do not think 
it should be allowed. And I do not think you should be into it.
    I think the standard question in opposition to it is very 
simple. If you had to have major surgery this afternoon in 
Walter Reed Hospital, do you think they would bring in a nurse 
to give you the anesthesia?
    Secretary Shalala. Well, Senator, I have made it a practice 
not to answer a hypothetical question, since I do not know what 
the standard practice is at Walter Reed. But let me say that 29 
States in which----
    Senator  Faircloth. All right, I will change my question. 
If you had all morning to decide if you were going to have an 
operation, would you request a nurse anesthetist or an 
anesthesiologist? That is not hypothetical.
    Secretary Shalala. Senator, I would defer to my physician 
as to what he or she thought was appropriate in my case, and 
would not second guess my physician if I were going into an 
operation.
    Senator  Faircloth. I will give you a pretty good idea of 
what he would say.

                           Disease prevention

    Now, we spend less than 1 percent of our budget on programs 
related to health prevention. We know that heart disease is a 
leading cause of death in this country. Yet CDC can only afford 
to fund prevention programs for cardiovascular diseases in 3 of 
the 50 States. If money talks, it is clear the message still 
focuses on treatment and not prevention.
    Would you give me your thoughts as to what we can do and 
how we might reverse this trend?
    Secretary Shalala. Well, as part of this budget, we have 
asked for two increases that are directly related. First, 
because cardiovascular disease disproportionately affects 
minorities, we have asked for resources for the CDC to help 
close gaps in terms of prevention as well as access to 
services, and also in helping people manage their own health 
situation. Second, we have asked for a new CDC prevention fund 
as part of this budget to help us expand our investment in 
prevention of diseases like cardiovascular disease. We would 
agree with you that we need additional investment. We believe 
this budget reflects that.
    Senator  Faircloth. Thank you. My time is up.
    Secretary Shalala. You are welcome, Senator.
    Senator Specter. Thank you very much, Senator Faircloth.
    Senator Cochran.
    Senator Cochran. Thank you, Mr. Chairman.
    Madam Secretary, welcome to our committee.
    Secretary Shalala. Thank you.

                            Fraud and abuse

    Senator Cochran. We appreciate very much your cooperation 
with our effort to understand the budget request and to deal 
with problems that may be presented at the Department of Health 
and Human Services.
    We have had an opportunity to look at some of the requests 
for additional funds and user fee imposition that is 
contemplated by the President's budget request to make up for 
some of the shortfalls in funding. And one thing struck me as 
interesting in talking to some of my constituents in my State 
is this new effort to deal with fraud and abuse of the program, 
which we applaud generally as a very important undertaking, is 
creating some obvious instances of abuse by the Government, it 
seems to me.
    And let me cite one example that was brought to my 
attention the other day. In early February, one of the small-
town hospitals in our State received a letter from a U.S. 
attorney in the State of Pennsylvania. The letter, which I am 
going to put in the record, dated February 9, recites that this 
is coordinating office for Federal False Claim Act cases 
arising under the medicare program. And that as a result of an 
audit by the Office of Inspector General, this hospital had 
been found to have filed two claims for nonphysician outpatient 
services of $204.34, in 1990, between November 1, 1990, and 
December 31, 1991, and another for $220.92, between the dates 
December 1, 1987 and October 31, 1990. And after reciting the 
fact that they found that these were duplicate claims and 
should not have been filed, it pointed out all the penalties 
under the False Claim Act that can be visited upon this small-
town hospital, and then says:
    The total financial exposure of your hospital arising from 
these reviews is $61,054.86.
    And then they go on to talk about the fact that if you 
would like to settle this case before litigation, please 
contact the undersigned in writing at the address indicated 
within 20 days of the date of this letter. And on and on. And 
just reading this letter that was handed to me is frightening, 
just in and of itself. But you can imagine a small-town 
hospital, with claims that they say they have gone back 10 
years, or thereabout, and they have had $400 in alleged false 
claims filed, and your exposure is $61,000.
    I know you are not the U.S. attorney in the Middle District 
of Pennsylvania.
    Secretary Shalala. I am not.
    Senator Cochran. But that is who signed the letter. And 
Yalobusha County Hospital, in north Mississippi, gets this 
letter. And, of course, the reaction has to be one of terror. 
Is this a terrorist state? What is going on here?
    My question is, what oversight is the Department, or HCFA, 
engaged in to monitor situations where alleged abuses are being 
handled in this fashion? Is there a Government policy, is there 
an administration policy to do this kind of thing to a small-
town hospital?
    Secretary Shalala. As you indicated, Senator Cochran, I 
have no authority over U.S. attorneys or their decisions as to 
which part of the law applies to a fraud case. I would 
appreciate it if you would refer that letter, and ask that 
question, to my colleague, the Attorney General. And, in 
addition, I would like to have it myself. In general, we do 
audits. The inspector general has a conversation with the 
hospital. They work out a settlement. A lot of this is a 
routine relationship. Recently, some U.S. attorneys have been 
using the False Claims Act. These cases have been brought to my 
attention. But the way in which our responsibilities are 
divided, our responsibilities include the inspector general 
being the leader or being part of teams that are investigating 
fraud. And we certainly do a large number of audits in this 
area.
    Senator Cochran. We will send that to you and to HCFA as 
well. I wanted to bring it to your attention, to let you know 
what seems to be a case of clear abuse of power by the Federal 
Government against this small-town hospital in my State. And 
you are the head of the Department, and I am bringing it to 
your attention.
    Secretary Shalala. And I appreciate that.

                        Home health surety bond

    Senator Cochran. And I appreciate your consideration of it. 
And you are using up my time. I have got a little question I am 
going to ask you about, and that is the surety bond requirement 
on home health agencies. We have got a lot of small-town 
operations that are not connected with big hospitals or 
multistate corporations, that can afford 15 percent surety 
bonds. This is a requirement, as I understand it, you have to 
file to get Medicare eligibility for accepting authorized 
reimbursement. A surety bond that is the greater of $50,000 or 
15 percent of the annual amount paid to the HHA by the Medicare 
program.
    This is operating as a very difficult financial burden for 
a lot of small-town home health care operations. And I am just 
reporting that as something that has been brought to my 
attention. I hope that there is some way to review that and 
make exceptions if they are justified or, in some other way, 
keep from putting out of business the small-town operators, and 
preferring instead the massive, big corporations to run the 
home health service programs.
    Secretary Shalala. We have given these agencies more time 
to comply with the law, and we still are not clear what the 
final rule will look like. So, I delayed the deadline for 
agencies to have bonds so that we could respond to some of the 
comments that we received in this area, particularly from small 
companies from the home health care business.
    Let me also say that this was clearly an effort by the 
Congress and by the administration to try to reduce the amount 
of fraud in the system. In particular, it was an effort to keep 
fly-by-night providers out of these programs. But there was no 
interest in keeping appropriate small businesses out, nor to 
put them out of business. So, certainly we have looked at this. 
And the industry itself, the surety bond industry, has made 
comments in this area, because they are also concerned.
    Senator Cochran. Thank you.
    Senator Specter. Thank you very much, Senator Cochran.
    Senator Gregg.
    Senator Gregg. Thank you.
    Madam Secretary, it is a pleasure to see you today.
    Secretary Shalala. Thank you.

                           Child immunization

    Senator Gregg. The immunization program in New Hampshire is 
projected to receive a 46-percent cut this year and a bigger 
cut next year. New Hampshire has the highest percentage of 
immunized children in the country. It has the best program in 
the country, I believe. And yet if it is subjected to these 
types of cuts, the program will be thrown into chaos, 
especially the relationship it now has with Maine.
    I would not presume you would be familiar with a unique New 
Hampshire situation, but I would ask that you go back to CDC 
and find out what is going on.
    Secretary Shalala. I will go back and look at that. We did 
indeed cut back, because States, in many places, were not 
drawing down the money that was available, and we reallocated 
some of that money.
    Senator Gregg. That ran out. What happened was there was an 
$80 million carryover. And we ran through that over the last 2 
years. And I think that that has affected the budgeting 
process, so that we are working off a baseline that is not 
compatible with what the reality is.
    Secretary Shalala. That may be what occurred. What I have 
said, Senator, is that we do not intend to underfund the 
vaccine program if we need to adjust that decision. We also do 
not want to leave money sitting around that is not being used.
    Senator Gregg. I understand that.
    Secretary Shalala. So we are attempting to find a balance.
    Senator Gregg. I think this was that. I think the pendulum 
went one way, and now it has swung back the other way.
    Secretary Shalala. We will be happy to look at that. As we 
continue in the appropriations process, we will want to make 
sure that our number is correct.
    Senator Gregg. Well, I am concerned about other States, but 
I am specifically concerned about the New Hampshire situation. 
Because it is a program that has worked extremely well.

                          Tobacco legislation

    On the tobacco settlement, why should we give these 
companies, these tobacco companies, any immunity at all from 
lawsuits? I mean, their action has been pretty reprehensible 
here, especially as we see this documentation coming out, that 
reflects the fact that they have produced a product that they 
knew was addictive, and targeted it on children. I cannot see, 
from my standpoint, why we should have any settlement around 
here that deals with giving immunity at all. And I am 
interested in why the administration has signed on to the 
Conrad bill, which, while it does not specifically state 
immunity, but obviously it presumes immunity, because it 
presumes the tobacco companies will sign off on it.
    Secretary Shalala. Senator, I did not assume that the 
Conrad bill had a large section on immunity.
    Senator Gregg. No; it does not. But it is going to have 
immunity in the end, because it has an unconstitutional 
advertising language in it. So that the only way you are going 
to get that is by a contract agreement with the tobacco 
companies, which requires immunity.
    Secretary Shalala. The reason the President endorsed that 
bill was that it covered the principles which he laid out that 
he would have to have in any comprehensive tobacco legislation. 
And that bill clearly does, from the price increase to----
    Senator Gregg. Well, OK, but let us go back to just the 
immunity issue. What is the position on that?
    Secretary Shalala. What the President has said on the issue 
of immunity is that not until all of the issues--principles--
that he has outlined are covered in a piece of legislation does 
he believe that any other issue ought to be considered. And 
that would obviously include immunity or any other issue that 
anyone wanted to bring up at that time.
    But, first, we want to see a comprehensive piece of 
legislation with a significant price increase. Plus, we want 
provisions that care for tobacco farmers and their 
communications, and stop tobacco companies from doing business 
as usual, and which keeps the FDA a nimble, clear organization 
with oversight over tobacco. We have outlined our principles. 
And we have not spoken to any other issues other than those 
covered in what the President considers to be critical parts of 
comprehensive tobacco legislation.
    Senator Gregg. So the administration has no position on 
immunity?
    Secretary Shalala. The administration has said repeatedly 
that we want a comprehensive piece of legislation, with a 
significant price increase, which covers the major issues the 
President has recommended. If all of those are covered, and 
Congress, working in a bipartisan manner, then wants to bring 
up other issues, we would be happy to consider them at that 
time.
    At this moment, we will endorse only comprehensive packages 
which cover all of the issues the President has outlined.
    Senator Gregg. So if we pass a bill that addresses those 
issues which you have just addressed, and include in it that 
there will be no immunity, you would accept that?
    Secretary Shalala. The President has outlined the critical 
issues. He would be happy to support a comprehensive piece of 
legislation that covers all of those issues. But we also have 
reiterated over and over again that it must have a price 
increase as part of it. We think that is critical.
    Senator Gregg. But what I am saying is if we passed a bill 
that had all the elements that you wanted--a price increase, 
FDA unilateral authority--I have forgotten the other ones--and 
then included in that bill that there be no immunity, that 
would be acceptable, because you have gotten everything you 
wanted, and a no immunity, no immunity language would then, 
therefore, be acceptable?
    Secretary Shalala. He will endorse a comprehensive bill, 
which covers his issues, that has bipartisan support. He just 
did that in the case of the Senator Conrad's bill. He indicated 
that he would support that bill and would be prepared to sign 
it.
    Senator Gregg. All right. Thank you.
    Secretary Shalala. You are welcome.
    Senator Specter. Thank you very much, Senator Gregg.
    Ms. DeParle is in the room. Would you please join the 
Secretary at the witness table.

                       revisions to Epogen policy

    Secretary Shalala. We want to talk about the revisions to 
the EPO policy.
    Senator Specter. Let me revisit the chronology, review the 
bidding here for just a minute. In the legislation passed last 
year, the bill expressed concern that HCFA's new Medicare 
payment policy for EPO may negatively impact on the quality of 
care received by patients with end stage renal disease, and may 
increase overall health costs. And I then wrote to you, 
especially about it, Secretary Shalala.
    And I got back a response, dated February 13, from Ms. 
DeParle. And the first question I have is, why does it take us 
so long--almost 3 months--to get a response to a letter like 
that?
    Ms. DeParle. Mr. Chairman, thank you for the opportunity to 
testify today. The question of how long things take is a big 
struggle for me, in Government, and I am sure for the 
Secretary, in the Department. I am particularly aware of this 
issue because, as you may know, I was confirmed in November. 
And in December, I became aware of this problem, primarily from 
letters I was getting from Members on both sides of the aisle. 
They seemed to be concerned about this policy.
    Senator Specter. You got a lot of letters?
    Ms. DeParle. Yes, sir; I did.
    Senator Specter. How many, roughly?
    Ms. DeParle. I do not know how many, but I will tell you 
the thing that struck me was that, over the holidays, the 
Christmas holidays, I read all the congressional 
correspondence--I started doing that--and I remember one night 
I took home a letter from Senator Connie Mack and a letter from 
Congressman Pete Stark that both said the same thing, that they 
were concerned about the new policy, thought we ought to look 
at it again, and particularly they were concerned about the 
lack of an exceptions policy, physician justification, which 
had been the case before.
    And I was not familiar with this issue at all. And so what 
I undertook to do--and this was around the holidays, so late 
December--was to ask my staff to provide me with background on 
it. What had the policy been? What was the problem? Why had we 
changed it? And they probably held up a response to you during 
the time that we were looking at it.
    My staff told me, Senator, that there had been problems 
with, they felt, overutilization of the drug Epogen. I do not 
know how to pronounce it. Epoiten, I suppose, is the hormone.
    Senator Specter. Well, in your letter, dated February 13, 
1998, says that in September, based on concerns about evidence 
that such physician justifications were being routinely 
submitted, resulting in overutilization of EPO, we decided to 
eliminate this exception.
    What I would like you to do is to respond in writing to the 
subcommittee as to what took so long, from November 25 to 
February 13. According to your letter, it is based upon 
information you had prior to that time, before September. So 
without going through the specifics, I would like you to give 
us a response in writing as to what happened.
    Now, you have talked about letters from Congressman Stark 
and Senator Mack. How about my letter of November 25?
    Ms. DeParle. Sir, I did not particularly remember your 
letter, but I did say that I had seen a lot of letters on this. 
And what I was trying to say was that we had a problem, the 
staff informed me, with overutilization. And also, apparently, 
there was some problems with there were some studies that 
indicate that, with some patients, the use that--keeping them 
at a hematocrit that is about 36 can be a problem. And that was 
why they had chosen to go with a new policy.
    Senator Specter. Well, that is a matter for the doctors. 
That is a matter I was raising with Secretary Shalala before 
you walked in, as to what is being eroded here is the doctor-
patient relationship.
    Ms. DeParle. I agree with you. And that is why I personally 
looked at this. There was a lot of disagreement within our 
agency about this, frankly.
    It appeared to me, two things, Senator. One was my instinct 
was that it was not correct to have a policy that did not allow 
for a physician exception, which had been the policy we had 
before. Second, it was my impression, Senator, that the 
decision to change the policy had been made rather hastily. And 
I wanted to be sure that I had a chance to look at the data. So 
I asked the staff to give me the data on the impact of the new 
policy.
    The good news is, I think, that it does not appear, from 
the data, that it has had a negative effect on people. But I 
still think the policy was not well founded. And that is why, 
today, I wanted to advise you that I want to change the policy. 
And, in fact, I did look at your most recent letter, which I 
saw over the weekend. And, in general, I think you and I agree.
    There is only one area where I think there is a bit of a 
difference between what you are recommending and where I came 
out. But I think, actually, because I am saying we need to look 
at the hematocrit levels, that we are closer than you may think 
or that it may appear.
    Senator Specter. Well, I am going to come to that in just a 
minute. But what I am trying to ascertain is why it takes so 
much congressional oversight. You are going to get for me the 
sequence of events as to why it took from November 25 to 
February 13 to respond to the letter. Then the next question I 
have for you is, you are now saying that you are concerned 
about the doctor's evaluation. But in the letter of September 
13, you talk about evidence that such physicians' 
justifications were being routinely submitted.
    Is that to suggest that the physicians' justifications are 
wrong?
    Ms. DeParle. Not necessarily. And I do not have evidence to 
say that, sir.

                         overutilization of EPO

    Senator Specter. Well, that is why I wonder why you say 
resulting in overutilization of EPO. I am trying to find out 
what the basis is for your conclusion that there is 
overutilization, as you put it, because physician 
justifications were being routinely submitted.
    I would like you to tell me what that means. I would like 
you to tell me what evidence you had to say that. Because you 
are denigrating the physicians' recommendations by saying that 
they are routinely submitted, which is to suggest that they are 
not thoughtfully submitted.
    Ms. DeParle. No, sir; I would not want to do that.
    Senator Specter. Well, I would like to know why you say 
routinely submitted. This is a recurrent problem that we have 
with HCFA, where there is a fury out there in the medical 
community as to what you are doing. So I want to find out what 
you did in this case, because we have taken a lot of time and a 
lot of effort on this particular matter. So I would like you to 
tell me in writing what led you to say that there was 
overutilization and that the physicians' justifications were 
being routinely submitted.
    I do not want to take any more time with it now.
    Ms. DeParle. I will be happy to do that.
    Senator Specter. We have a lot of ground to cover. And I do 
not think you can really do it without referring to your files.
    [The information follows:]
                   Letter From Nancy-Ann Min DeParle
           Department of Health and Human Services,
                      Health Care Financing Administration,
                                    Washington, DC, March 13, 1998.
Hon. Arlen Specter,
U.S. Senate,
Washington, DC.
    Dear Senator Specter: I appreciated the opportunity to appear 
before your subcommittee on Tuesday to discuss a number of issues 
relating to HCFA's work in developing a proposed rule on physician 
practice expense. At the hearing you raised several questions in regard 
to HCFA's policy concerning EPO and our coverage of the Salitron System 
for treating disorders associated with Sjogren's syndrome. You also 
inquired whether it is possible to waive the salary equivalency 
guidelines in certain circumstances, or for certain providers. This 
letter responds to those questions.
    First, in your letter to the Secretary about EPO, you asked for a 
justification of our original policy and urged us to revise that 
policy. At the hearing, you also asked for the reason for the delay in 
the revision of the policy.
    HCFA altered Medicare's national coverage policy for EPO in the 
ESRD population effective September 1, 1997 in an effort to promote 
national consistency in application of EPO coverage policy and to 
protect beneficiaries from the potential adverse consequences of over-
administration of EPO. Under that policy, Medicare moved from an 
absolute limit of a hematocrit reading of 36 percent to a rolling 90-
day average hematocrit of 36.5 percent. In addition, the exception 
providing physicians with discretion to exceed the 36 percent level was 
eliminated based on a lack of evidence in the medical literature of any 
benefit for exceeding the target range (31-36 percent). In fact, there 
was evidence of the potential for harm to patients with cardiac 
conditions if hematocrits were maintained above that range. In 
implementing this new policy, HCFA committed to closely monitor the 
hematocrit data reported through the claims processing system to assure 
that the new policy did not result in adverse consequences.
    Our staff did not consult with the renal community before 
announcing the new policy. In hindsight, I believe this was a serious 
mistake. However, during the period of time between announcement of the 
policy and implementation staff met several times with representatives 
from Amgen, the National Renal Administrators Association, the Renal 
Physician Association, and the Renal Coalition. Since that time, HCFA 
staff have had three meetings with researchers from Amgen or associated 
with Amgen. At one of these meetings, other representatives from the 
renal community were also present. In addition, this issue was also 
raised informally by members of the renal community at nearly every 
discussion where other items were the main agenda topic.
    Upon receiving your earlier letter, and numerous others, and based 
on concerns raised by the renal community, in December, I asked our 
staff to review the impact of the new policy. Given normal time lags in 
submitting and processing claims, we did not have even preliminary data 
on the impact of the new policy until December. That preliminary data 
did not indicate any negative impact. Additional data that became 
available in February, while still not indicating any negative impact, 
did appear to show that the steady improvement in the percentage of 
patients within the target hematocrit range (30-36 percent) had 
stopped. Fostering improvement in this area was a major focus of joint 
quality improvement efforts by the renal community and HCFA. The fact 
that there appeared to be no further improvement since the revised 
coverage policy was implemented caused us to reexamine this policy and 
develop alternatives.
    As you are aware, on March 10, I announced a revised policy with 
two components. First, we have reinstated a medical justification 
policy to allow physicians discretion to exceed the 36 percent level 
for selected patients as needed. Second, in the absence of medical 
justification, if the hematocrit level for a given month exceeds 36 
percent and the 90-day rolling average exceeds 36.5 percent, payment 
for that month will be reduced rather than denied (i.e., a ``partial'' 
denial rather than a complete denial for the whole month). Payment will 
be made at the lower of the actual dosage administered or 80 percent of 
the allowable dosage for the previous month. As you requested, we made 
the new policy effective on March 10, and payment adjustments will be 
made retrospectively to that date. (I have attached a copy of the 
Program Instruction effecting this change. This instruction was faxed 
to your office on Thursday). In the months ahead, HCFA will work with 
the renal community to develop guidelines regarding when it is 
medically appropriate for patients to exceed the 36 percent standard in 
order to assure that the medical justification policy is not subject to 
abuse.
    Our revised policy creates incentives for a gradual reduction in 
EPO dosage, if the patient is above the target range, consistent with 
the appropriate medical practice for titration of drugs and FDA 
recommendations. The revised policy also allows the 36 percent level to 
be exceeded according to physician discretion. By promoting the 
maintenance of patients at as high a level within the target range as 
possible, the revised policy is consistent with the National Kidney 
Foundation's Dialysis Outcomes Quality Initiative. Recommendations of 
the Anemia Work Group included in the Dialysis Outcomes Quality 
Initiative indicate that hematocrit be maintained between 33 percent 
and 36 percent. I recently met with a representative from the American 
Association of Kidney Patients, and they fully supported this policy 
change.
    Second, in regard to HCFA's coverage of the Salitron System, in 
1994, HCFA published a notice in the Federal Register indicating an 
intent not to cover Salitron based upon a 1990 technology assessment 
that HCFA had commissioned. As your February 12 letter points out, no 
final rule was ever published.
    We received very few comments on that notice. In the meantime, the 
Durable Medical Equipment Regional Carriers (DMERC's) have had 
discretion regarding coverage.
    On Monday, March 9, based on your continued interest in this 
device, I directed staff to request the Agency for Health Care Policy 
and Research (AHCPR) to conduct a new technology assessment. We will 
ask the manufacturer to submit any significant data to AHCPR. We will 
publish a Federal Register notice outlining this course of action (and 
withdrawing the 1994 notice).
    Finally, you asked me to address my review of the incoming letters 
from you on these issues. In regard to your letter of February 12, 
about the Salitron System, I did not see that letter, even though I 
have instructed staff to provide me with copies of all correspondence 
from Members of Congress. Unfortunately, a mistake was made within our 
correspondence control system. Please consider this letter a response 
to your February 12 letter.
    In regard to your letter of November 25, I responded with a letter 
in February which said that staff were monitoring the data but did not 
convey the fact that I was actively revisiting the EPO policy and in 
fact, was on the verge of announcing a new policy. We should have moved 
more quickly on revising this policy and provided you with a more 
responsive answer. Such an answer would have obviated the need for your 
second letter to the Secretary dated March 5.
    In the hearing on Tuesday, you also inquired whether it is possible 
to waive the salary equivalency guidelines in certain circumstances, or 
for certain providers. The salary equivalency guidelines regulation was 
published with an effective date of April 10, and we believe that we do 
not have the authority to change or waive that date for one provider or 
a group of providers. Existing regulations do provide for exceptions to 
the guidelines for unique circumstances or special labor market 
conditions although any exceptions may reduce the savings from these 
guidelines. These exceptions are available to providers of services as 
I'll explain below.
    The guidelines apply to payments that the Medicare program makes to 
skilled nursing facilities, home health agencies, and other providers, 
for therapy services provided under arrangement, HCFA pays the entity 
(the provider) that claims the therapy costs in its cost report. This 
means a provider can apply for an exception if (1) that provider files 
the cost report with HCFA and (2) it contracts with another entity to 
provide therapy services, because the guidelines do not apply to 
therapists directly employed by the provider.
    I thank you for the opportunity to appear before the committee and 
I trust that I have answered your questions. I look forward to 
continuing to work with you on these and other issues in the future.
            Sincerely,
                                     Nancy-Ann Min DeParle,
                                                     Administrator.

                              HCFA action

    Senator Specter. The point I want to come to now is the 
minimum HCFA action, which has been presented to me--and I am 
prepared to get into the details of it, to find out what is 
involved--but there are three items which have been articulated 
in my letter to you, to reinstate the medical justification, to 
allow physician discretion for selected patients as needed. My 
question to you is: Is that part of your new policy?
    Ms. DeParle. Yes, sir; it is. This is your letter of March 
5, last week?
    Senator Specter. That is right.
    Ms. DeParle. Yes, sir; it is.
    Senator Specter. OK. The second point is raising the 
hematocrit to 37.5 at least. Is that part of your new policy?
    Ms. DeParle. No, sir; it is not.
    Senator Specter. And why not?
    Ms. DeParle. Because, sir, our policy in the past, as you 
know, was to keep it at 36 percent. And the package insert that 
goes with this drug, that was approved by the FDA, indicates 
that patients should be kept in a range of 30 to 36 percent.
    Our policy now, as revised, as I understand it, is that we 
look at a rolling 3-month average. And if the patient is around 
36.5 percent, that is judged to be appropriate. And I did not 
have a basis, based on the evidence and data that we have, to 
change that number, although I am happy to work with the 
nephrologists and with the renal community to see if they can 
provide data for a different number. But I did not have a basis 
for the number you suggested, sir, which was 37.5.
    Senator Specter. Well, have not the physicians in this 
field asked you to raise that level to 37.5?
    Ms. DeParle. Sir, I am not aware that they have.
    Senator Specter. Well, I believe they have. I believe that 
is the point. I believe the point is that in the rolling 
averages, as you take them, they go low. And there are very, 
very serious consequences when you have the percentage of blood 
taken up by the red blood cells is lowered--weakness, fatigue, 
poor oxygenation of tissues. It generally leaves the patient in 
a condition where they just cannot function.
    Ms. DeParle. Sir, as I understand it, this policy was, in 
fact, an improvement on our earlier policy, which held things 
to 36. And especially now, when you reinstate the medical 
justification policy, I think there should be room here to 
maintain the hematocrit at the levels that are recommended in 
the package insert that was approved by the FDA. That was the 
basis for this decision. I will be happy to meet with anyone 
you want me to meet with in the nephrology community who thinks 
otherwise. But what I was aware of was that evidence.
    Senator Specter. Well, we are meeting right now. This is 
the meeting.
    Are you aware that the National Kidney Foundation's 
dialysis outcome quality initiative guidelines recommended that 
there be a 37.5 level to ensure that a majority of patients are 
targeted in the 33 to 36 percent range?
    Ms. DeParle. No, sir; I am not.
    Senator Specter. Well, what have you considered, in terms 
of medical evidence, in reaching the decision not to use the 
37.5 level?
    Ms. DeParle. Sir, the staff in our Office of Clinical 
Standards and Quality, which worked on this, it is my 
understanding, met with a number of representatives of the 
nephrology community, including a number of medical 
specialists, as well as the carrier medical directors, who 
administer this policy for us. And in that office there are a 
number of physicians. And I personally have talked to other 
Members of Congress and their staffs, as well as, as I said, 
reviewed your letters and the memoranda and other documents 
from our staff. That is what I have looked at.
    I just did not have a basis, based on what I was presented 
with, to make a decision to go higher than what the package 
insert recommended.
    Senator Specter. Ms. DeParle, what is your level of 
expertise in this field? What is your background and training?
    Ms. DeParle. I am a lawyer, sir.
    Senator Specter. So there is no special level of expertise 
that you have to make this kind of an evaluation?
    Ms. DeParle. Sir, I do not have a special level of 
expertise to make a medical evaluation, but my staff does--the 
staff at the Health Care Financing Administration, including a 
number of medical professionals, as well as--as I said, this 
decision, as I understand it, which was--the initial decision 
was made before I was there--but, as I said, it was made in 
consult with many doctors who work in HCFA, as well as those 
who work for our carriers.
    Senator Specter. Well, I think you and I have gone about as 
far as we can go on this issue. And the experts who were 
complaining to me will have to sit down with the experts who 
are advising you and try to figure it out. And if necessary, 
you and I will join them. But I have heard a lot of complaints 
about the levels that you have attached here.
    The third requirement that we have here is to replace 
HCFA's current practice of total reimbursement denial with a 
partial denial. Do your new regulations include that?
    Ms. DeParle. Yes, they do. I agree with you on that.
    Senator Specter. And what else do your new regulations 
include, if anything?
    Ms. DeParle. Well, there really is not a new regulation, 
sir. What happened was I just made this decision over the 
weekend, and instructed staff to get working on implementing 
it. And I wanted to advise you of it today at our hearing. So 
the next step will be to do a program instruction, it is my 
understanding, so that those who administer our policies in the 
field will know that, in the future, this is the policy.
    Senator Specter. So could we put that policy into effect 
today?
    Ms. DeParle. Yes, sir; I can try. I bet they cannot get it 
written until tomorrow, but I can say that it is effective 
today.
    Senator Specter. Well, there is a fair amount of time left 
today. Let us try to get it done today.
    Ms. DeParle. I will try.
    Senator Specter. OK, we have quite a few more questions in 
the second panel, Ms. DeParle, so we will proceed now with 
Secretary Shalala.
    Senator Faircloth, I would yield to you. I finished that 
one subject. I regret taking a little extra time on it.
    Senator  Faircloth. That is all right. I could tell you 
were interested in the subject. [Laughter.]
    Senator Specter. I have that bad habit.
    Senator  Faircloth. No; that is fine. Thank you, Mr. 
Chairman.
    I have two questions I wanted to bring up, Madam Secretary. 
And one of them is the recent decision that seniors no longer 
qualify for home health care benefits solely on the need to 
have blood drawn. No; in North Carolina, we are--and I am sure 
in a lot of the rural parts of this country--are pretty far 
removed from lab technicians or people with the capability of 
withdrawing blood.
    Now, I understand that this was done because of fraud. But 
HCFA has so far not identified to any Member of Congress how 
big the problem is of fraud here, and documented its abuse. 
Could you do so? And what level of infraction is appropriate 
and compelling to stop this practice?
    Secretary Shalala. I would provide whatever we have free 
trade, Senator Faircloth. I think the rule was changed--it was 
eliminated as something that required a skilled practitioner, 
under the Medicare law. And I would be happy to provide 
whatever information that we had related to fraud and this 
issue to you for the record.
    Senator  Faircloth. All right. Well, if you would, have 
somebody send it over.
    Secretary Shalala. Yes, sir.
    Senator  Faircloth. Like as in the morning or this 
afternoon.
    Secretary Shalala. Right.
    [The information follows:]

                        Operation Restore Trust

    During Operation Restore Trust, the 5-State demonstration 
jointly conducted by the Health Care Financing Administration 
(HCFA), OIG, and the Department of Justice, we saw numerous 
situations where beneficiaries who needed blood draws but did 
not need other skilled treatment, were nevertheless receiving a 
full array of home health services. Home health claims reviews 
under Operation Restore Trust uncovered clinical examples of 
the problems associated with venipuncture. Examples include 
patients with atrial fibrillation who were using a blood 
thinning drug, coumadin, but needed no other skilled treatment. 
Physicians ordered skilled nursing visits to draw blood for 
laboratory testing treatment. Physicians ordered skilled 
nursing visits to draw blood for laboratory testing (for 
adjustment of coumadin dose), and home health aide services for 
these individuals. In one case, even though there was no 
evidence that the patient needed skilled treatment, skilled 
nursing visits were prescribed 1-2 times per week, and a home 
health aide was ordered for 12 hours a day, 7 days a week to 
assist in showering, meal preparation, shopping, laundry, 
housekeeping, safety supervision, and escorting. The 
venipuncture provision targets this inappropriate use of home 
health services and ensures that individuals receive care that 
is medically necessary.

                                Viruses

    Senator  Faircloth. Here is one of those love in bloom 
statements, but it concerns. Incidentally, I thank you for your 
support for tobacco farmers. I was glad to hear you come out 
with that.
    But there has been a lot in the news, in Time magazine, in 
different places about the speed with which very, very deadly 
and very new viruses can spread around the world. I do not know 
whether you read the report or not. But I do not remember the 
exact dates. But in World War II, it took roughly 90 days for 
the flu virus to encircle the globe. Of course, now it can do 
it almost immediately.
    These potential epidemics are extremely challenging to 
everyone. And most people were absolutely shocked to learn that 
the first line of defense against these threats, the 3,000 
health departments scattered across the United States, are in 
most cases not in any way linked with a computer setup. And 
only 40 percent of our health departments are online. The 
remainder need computer training, manpower, and all of those 
things.
    What are we doing about that? And what should we be doing? 
And should we have the--can we demand--a lot of these are not 
funded by the Federal Government, these health departments. I 
mean, local funding is involved. Can we demand that they do it? 
I think it is totally necessary. When you read that, it is 
absolutely frightening how quick a catastrophe can move around 
the world.
    Secretary Shalala. What we are talking about is the public 
health infrastructure in this country, the core of which is 
State public health departments and State epidemiologists. I, 
in fact, just returned from a major meeting the CDC is hosting 
in Atlanta specifically on the subjects that you bring up. It 
is on emerging infectious diseases, on the new flus in 
particular, and the need to both rebuild and to strengthen the 
role of the epidemiologists and the public health 
infrastructure in this country. This is something we have been 
addressing since the beginning of this administration, 
including putting new surveillance systems in place that have 
quicker turnaround.
    The story of Hong Kong, in fact, is a story of a very good 
health department that did the right thing from the beginning, 
that routinely took swabs from individuals who were willing. 
And when they found something they did not understand, they 
sent it immediately to the CDC. That is what good public health 
departments in the United States do. They send the sample 
immediately--if they do not have the capacity themselves to 
make the diagnosis, they send it immediately to the CDC.
    In this budget is a new investment in the U.S. 
infrastructure, particularly. Some of it is related to food-
borne illnesses, some of it is related to these emerging and 
infectious diseases. This is part of the effort to rebuild our 
ability to quickly identify an outbreak and to quickly contain 
it. But as you point out, it does us little good to make these 
huge U.S. investments unless we simultaneously have 
surveillance systems around the world. Ships come in, people 
come to visit; these diseases know no boundaries. And it is, in 
fact, significantly cheaper for us to deal with tuberculosis in 
India rather than deal with that same case here in the United 
States, where it might cost us $100,000, and $50 there in 
India. So these multiple investments of our international aid 
budget, plus the HHS investments for the CDC to rebuild and 
strengthen our oversight and our surveillance systems are, in 
our judgment, critical.

                              Flu outbreak

    The lesson of the 1918 flu outbreak is a lesson that it can 
happen again. We were frightened by Hong Kong. It turned out 
not to have human-to-human transmission, but Hong Kong has just 
started their flu season. And as far as I am concerned, we need 
to continue to make significant investments in the Centers for 
Disease Control and in our national systems. The States have to 
take this seriously at the same time, they have to make 
investments at the same time in their own public health 
structures.
    Senator  Faircloth. All right. If you will make the demands 
on them to do it. And I thank you.
    And thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Senator Faircloth.
    Madam Secretary, I want to cover a number of points with 
you that may deal more specifically with Dr. Varmus at NIH, but 
these are matters of real concern. I have heard from Dr. 
Varmus, in response to my letter, that NIH is not doing the so-
called professional judgment budget, which represents an 
estimate for optimal funding levels, irrespective of economic 
conditions, that those have been done in the past, and the 
levels range from 20 to 30 percent higher, sometimes as much as 
50 percent, and what the NIH has done now is to balance 
extraordinary scientific opportunity against the budget 
limitations facing both the administration and the Congress.
    When I talked to Dr. Varmus at Senator Hatfield's ceremony, 
dedicating the building at NIH for Senator Hatfield, I told him 
that this subcommittee wanted to see the druthers list. And we 
do want to see that.
    The Senate went on record as favoring a doubling of the NIH 
budget over 5 years, in the sense of the Senate last year. When 
it came time for the budget, the health account was cut by $100 
million. And Senator Harkin and I offered an amendment to 
increase NIH by $1.1 billion, which was defeated 63 to 37. But 
I believe there may be sentiment within the Congress to do more 
for NIH if we see exactly what NIH says can be done. And I am 
going to press Dr. Varmus for that professional judgment 
budget, so we have their judgment as to optimal funding levels, 
irrespective of economic constraints.
    And my question to you is, will you recommend to him or 
instruct him, whatever you do, that he complies with that 
request?
    Secretary Shalala. Well, as you know, the National Cancer 
Institute and the Office of AIDS Research do this as a matter 
of statute. NIH did not do that for the 1999 budget. I think 
this may reflect the significant increase that they did get. 
But my view is that the National Institutes of Health and the 
rest of us ought to answer whatever questions Congress has. And 
while they have a very large increase, I am well aware that 
Congress may consider some additional funding. I think that you 
will find that the Director of the National Institutes of 
Health is quite enthusiastic about the budget the President did 
propose and about the range of opportunities that it provides.
    Senator Specter. Well, I accept this enthusiasm for the 
President's budget. He has probably been enthusiastic about the 
previous President's budgets, before President Clinton, 
although he was not here before President Clinton. But I think 
he has been even more enthusiastic about what the Congress has 
done, in putting up more than the President has.
    And that is our decision as to how we allocate the $1.7 
trillion. So I appreciate your support, as you say, for getting 
us the information which the Congress wants.
    Secretary Shalala. Yes; though, Senator, you do understand 
that all of us that work for the President are expected to 
support the President's recommendations once we have our 
internal discussions within the administration. We have kept to 
that. I fully understand that the Congress has additional 
questions and will ask the scientists for their professional 
judgment. But I simply want to reiterate our own support for 
the President's historic recommendations that he made.
    Senator Specter. Madam Secretary, I understand that you 
support what the chief executive officer has said, your 
appointor. But that is not really relevant to the congressional 
function to make an independent judgment as to how we allocate 
the resources. And that is why we want the judgment of NIH as 
to what is optimal. That is what we are asking for.
    We know that he will support the President. We expect that. 
And sometimes I support the President, too.
    Secretary Shalala. I know that. And we appreciate it, 
Senator.
    Senator Specter. We are going to press on this clinical 
aspect with Dr. Varmus, and I will not take up any time here. 
We have a tough issue on ergonomics, where I had written to Dr. 
Varmus concerning a study which had been requested by some on 
the House side.

                            Ergonomics issue

    Coincidentally, on February 4, a letter was submitted by 
other House Members, where Ms. Taylor, my deputy here, talked 
to Dr. Varmus. He said that he did not agree to this type of 
study. And the ergonomics issue has been debated very heavily 
in the committee. And we have an arrangement where no 
regulations were to be published in this fiscal year. And we 
are hopeful that we have put that matter to rest without having 
another very protracted study on the matter. But, again, we 
will take that up in detail with Dr. Varmus, unless you have 
any comment which you would like to make.
    Secretary Shalala. No; what I have said to Dr. Varmus is 
that until there is a resolution on this issue between both 
Houses of Congress, plans for any activity ought to be on hold. 
And I did see your letter to Dr. Varmus. So we will be happy to 
work with you, Senator.
    Senator Specter. Madam Secretary, if the tobacco agreement 
is not reached, how are we going to fund the Department of 
Health and Human Services?
    Secretary Shalala. Senator, we believe that there is no 
reason why a bipartisan group of Members of Congress, working 
with the President, cannot agree on a comprehensive piece of 
tobacco legislation. We believe it is possible to get consensus 
on that legislation. We have outlined the major principles. We 
have already endorsed one bill on the Senate side, and are 
providing technical assistance. So we are very enthusiastic 
about this huge public health step, which will also obviously 
provide resources for some of the public health investments we 
want to make.
    But what I have said consistently on the President's 
priorities--and NIH is clearly at the top of that list--is that 
if the resources that we have identified, whether they are user 
fees or whether it is legislation that must be passed, are not 
there, we are going to have to work with the committee to make 
sure that these priorities are passed.
    Senator Specter. Are you prepared to give the tobacco 
companies immunity from future liability and class actions for 
the settlement?
    Secretary Shalala. Senator, the President has said that any 
legislation he will support must have a significant price 
increase, be comprehensive, change the behavior of the tobacco 
companies, leave FDA in place, work with the farmers and with 
their communications to make sure that they are not hurt by the 
legislation, and fundamentally change behavior and hold tobacco 
companies accountable. If all those things are in place, if 
there are other issues that are raised as part of an overall 
comprehensive piece of legislation, we will consider them. But 
until we see a bipartisan effort and a bill that is put 
together and has the support of the vast majority that we can 
endorse, we are not prepared to discuss additional issues.
    Senator Specter. Madam Secretary, what you have articulated 
is a little bit of something for everybody, and make a lot of 
people happy. But the reality is there is not going to be a 
settlement unless there is a release of the tobacco companies 
from future liability and class actions. And unless someone is 
prepared to step up to the table and say yes, I am prepared to 
do that, I think that any inclusion of funds from the tobacco 
companies is really totally illusory.
    Secretary Shalala. Senator, what we have consistently said 
is that we are talking about a major piece of legislation that 
would be a huge public health step toward reducing youth 
smoking in this country. We are going to keep our eye on the 
ball. And if we see a comprehensive piece of legislation that 
has all of the elements the President has recommended--in 
particular, the price increase, which we know will have an 
effect on children smoking in this country--then we are 
prepared to discuss other issues.

                           Class action suits

    Senator Specter. Well, the best that I take from that 
answer is that you would not rule out a release from liability 
from class action suits in the future.
    Secretary Shalala. Senator, we will consider any other 
issue that anyone wants to put on the table once we see the 
comprehensive piece of legislation.
    Senator Specter. Including release of liability from future 
class action suits?
    Secretary Shalala. Senator, we are not taking a position on 
anything specific, other than that on which we have already 
taken a position: a comprehensive piece of legislation that 
focuses on reducing children smoking. Once we see that 
comprehensive piece of legislation which we believe there is a 
bipartisan majority to pass, that will be a huge public health 
step, then we would be happy to discuss any additional issues.
    Senator Specter. Including a release of liability for 
future class actions? [Laughter.]
    If you repeat the same answer and do not answer the 
question, and you do not want to answer the question, I will 
not ask it again.
    Secretary Shalala. Senator, I think I have answered the 
question. The President will support a comprehensive piece of 
legislation.
    Senator Specter. I know what you said.
    Secretary Shalala. If there are other issues----
    Senator Specter. Like a release of future liability from 
class actions. [Laughter.]
    Secretary Shalala [continuing]. That could be discussed, we 
would be happy to look at them at that time. First, we want to 
see the public health package.
    Senator Specter. Well, we cannot be happy to look at your 
budget when it has $1.9 billion which is predicated on what is 
really illusory and pie in the sky. But I think I understand 
your position.
    Thank you very much, Madam Secretary.
    Secretary Shalala. Senator, if I may, since you are going 
to hear from Nancy-Ann Min DeParle, I want to make clear both 
my support for her and my enthusiasm about her willingness to 
take on the toughest job in the Department. We were lucky to 
attract a young woman like Nancy-Ann Min DeParle to take on 
this responsibility. I have full faith in her ability to lead 
the Health Care Financing Administration, and I think she is an 
outstanding professional. Thank you, Senator.

                     Additional committee questions

    Senator Specter. Thank you very much. There will be some 
additional questions which will be submitted for your response 
in the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                Department of Health and Human Services
                     Additional Committee Questions
                                cloning
    Question. The adult-cell technique used to create the sheep 
``Dolly'' is very powerful and could be used someday to meet legitimate 
medical needs, such as the production of scarce replacement organs, 
skin, or blood. FDA has said they hold regulatory jurisdiction over 
cloning. How will the agency assure that the technique is used for 
legitimate research and not for cloning of a human being?
    If this cloning technique does support useful purposes, are there 
steps in the cloning process that could be monitored or regulated?
    Answer. On March 4, 1997, President Clinton issued an Executive 
Order which prohibits federal financing of human cloning, and has 
repeatedly encouraged Congress to pass legislation to ban human 
cloning. In July 1997, President Clinton submitted legislation which 
would ban cloning of a human, whether publicly or privately funded, for 
a period of five years. In February 1998, Senator Feinstein introduced 
a similar bill with a 10 year ban on cloning a human.
    Independent of future legislation regarding the cloning of humans, 
FDA has the jurisdictional authority to regulate human cloning, 
including cloning of organs, under the Public Health Service Act 
(regulating biological products) and the Federal Food, Drug and 
Cosmetic Act (regulating drugs). Under these statutes and implementing 
FDA regulations, clinical research on the creation of a human being 
using cloning technology may proceed only when an investigational new 
drug application (IND) is authorized by the FDA. Before such research 
may begin, the sponsor of the research is required to submit to FDA an 
IND describing the proposed research plan, to obtain authorization from 
an independent institutional review board, and to obtain the informed 
consent of all participating individuals. FDA may prohibit a sponsor 
from conducting the study (often referred to as placing the study on 
``clinical hold'') for a variety of reasons, including if the Agency 
finds that ``human subjects are or would be exposed to an unreasonable 
and significant risk of illness or injury,'' ``the IND does not contain 
sufficient information required * * * to assess the risks to subjects 
of the proposed studies,'' or ``the clinical investigators * * * are 
not qualified by reason of their scientific training and experience to 
conduct the investigation.''
    In the case of attempts to create a human being using cloning 
technology, there are major unresolved safety questions. Until those 
questions are appropriately addressed, the Agency would not permit any 
such investigation to proceed.
                   liver transplant allocation policy
    Question. Madame Secretary, you recently notified the Senate that 
HHS intends to change the current liver allocation policy. Now, donated 
livers are first offered to patients ranked on a local list prior to 
being made available nationally. I understand that your new policy will 
begin to implement a nationwide severity of illness policy. Could you 
elaborate on why the current liver allocation policy needs to be 
changed.
    Answer. We continue to have a serious shortage of organs for 
transplantation, and indeed in recent years, the shortage has grown 
worse. We have also not yet achieved many of the important benefits of 
a national organ-sharing network that were envisioned by the National 
Organ Transplant Act of 1984 (NOTA). The most visible short-coming is 
the wide span in average waiting times for those on transplantation 
waiting lists. In some areas of our Nation, patients wait 5 times 
longer or more for an organ than in other areas. Less visible but more 
important are the resulting inequities in who receives organs. Where 
waiting times are shortest, organs may go to patients who are less ill; 
while at the same moment, in areas where patients wait longer, organs 
often are not offered to patients with greater medical need. In the 
worst case, patients die in areas where waiting times are long, while 
at the same time organs are being made available to less ill patients 
in areas with shorter waiting times. Even as technology has improved, 
making it possible to preserve organs longer and hence offer them over 
a wider geographic area, the allocation scheme of the Organ Procurement 
Transplant Network (OPTN) has continued to give preference to local use 
of organs even if such organs could be used to save the lives of sicker 
patients located further away.
    Question. It is my understanding that the administration will soon 
issue new regulations regarding liver allocation policy. Can you share 
with us what will be the key elements?
    Answer. HHS will establish broad performance standards and make 
clear the desired outcomes which will best serve the Nation. In 
preparing the regulation, we are developing performance and outcome 
standards which would be applied to the policies developed by the OPTN. 
The goal of the performance standards would be to make it possible for 
patients with the greatest medical need for transplantation to be more 
accurately identified by the national network and to be put at the head 
of the list for a suitable organ. This means the development of 
standard patient listing criteria and medical urgency categories that 
would enable our transplant network to reliably assess the medical 
condition and need of all patients awaiting transplantation. The 
regulation would look to OPTN to develop the specific, medically-sound 
policies for achieving goals such as uniform criteria among centers and 
the development of allocation policies that would make waiting times 
more equal in the various regions of the Nation. HHS does not seek to 
develop the policies and would not do so unless the OPTN failed to 
develop satisfactory policies of its own.
                        healthy start initiative
    Question. What have been the accomplishments of the Healthy Start 
program? In your opinion, is the program serving its core purpose of 
identifying the contributing factors to infant mortality and low-birth 
weights?
    Answer. We believe that many important lessons were learned through 
the original Healthy Start communities and their successes should be 
passed on and replicated in other interested communities. The purpose 
of the Healthy Start Demonstration was to create and implement 
community-based strategy targeted at improving birth outcomes among 
underserved women. The demonstration phase of the Healthy Start 
Initiative concluded in September 1997. An interim report, Interim 
Findings: Impact of Healthy Start on Infant Mortality and Other Birth 
Outcomes, found that infant mortality declined substantially in the 
Healthy Start project areas between the baseline period prior to 
Healthy Start and the early years of Healthy Start. Across all of the 
projects in the interim evaluation there was a 21 percent reduction in 
infant mortality. There was also a 20 percent national decline in 
infant mortality over the same period. The Detroit Healthy Start 
program significantly reduced the infant mortality rate from 27.2 to 
22.5 infant deaths per 1,000 live births, a 17 percent reduction. The 
Philadelphia Healthy Start program significantly reduced its post 
neonatal mortality rate from 7.7 to 4.5 postneonatal deaths per 1000 
live births. The Healthy Start program was also associated with 
increases in the percentage of women who received adequate or better 
prenatal care.
    In addition, the Healthy Start Communities have reported positive 
progress towards increasing the number of women entering prenatal care 
early, increasing utilization of services, increased public awareness 
of the contributing factors of infant mortality, and improved family 
and community support.
    Question. How might the program be improved or extended in ways 
that would further the lessons learned up to now from the original 15 
Healthy Start sites?
    Answer. Fiscal year 1999 funding will provide for a continuing 
opportunity to reduce infant mortality by replication of successful 
Healthy Start models of intervention in urban and rural communities 
with high rates of infant mortality. In fiscal year 1999, $35 million 
will be awarded to up to 20 mentoring projects for continued support of 
successful strategies and the utilization of these projects as peer 
mentors to new Healthy Start communities and other health care 
providers, thereby maximizing the lessons learned to date in the 
reduction of infant mortality and low birth weight infants. In 
addition, $51 million will be awarded to up to 42 communities which 
have begun to replicate successful strategies of infant mortality 
reduction in fiscal year 1998.
            president's commission's consumer bill of rights
    Question. Last month the President issued an Executive Order which, 
among other things, directs HHS to ensure that Medicare complies with 
the Quality Commission's Consumer Bill of Rights by 1999, including 
providing access to specialists and ensuring adequate levels of 
beneficiary participation in treatment decisions. What specific steps 
does HHS plan to take to implement the Executive Order?
    Answer. The President has directed all Federal agencies with 
jurisdiction over health programs to ensure that all of these programs 
come into compliance with the Consumer Bill of Rights by 1999. With 
regard to HHS implementation of this order for Medicare, our analysis 
shows that Medicare is already largely in compliance. Our current plan 
is to take the following steps to ensure compliance with the order for 
Medicare (there may also be areas where we will need additional 
statutory authority):
  --Establish the new ``www.medicare.gov'' website as well as the 
        Medicare Compare database included in the website. These 
        innovations will help beneficiaries and relatives understand 
        the options available under Medicare. This helps to fulfill the 
        Information Disclosure Right. The website is live.
  --HCFA will issue a policy directive, based on current statutory 
        authority, that will ensure that health plans will be in 
        compliance with the Access to Specialty Care Right.
  --The BBA included a number of provisions related to complaints and 
        appeals that will be applicable to Medicare + Choice plans, and 
        we are in the process of implementing them. These provisions 
        will strengthen Medicare's existing protections for managed 
        care enrollees.
  --HIPAA requires HHS to promulgate standards for a specified set of 
        electronic health care transactions which is part of a broader 
        effort to protect the confidentiality of medical records. We 
        have undertaken this effort which will help to fulfill the 
        Confidentiality of Information Right.
  --Additional statutory authority is needed to bring the program into 
        full compliance with regard to confidentiality and choice of 
        provider rights.
    Question. Has the Department estimated the administrative costs, if 
any, of implementing these changes?
    Answer. While we have not made any formal estimation of the 
administrative costs involved with implementing these changes, we 
strongly believe that any costs will be minimal.
               agency for health care policy and research
    Question. Dr. Eisenberg, I understand that a conference was held in 
October 1997 which looked at ``Early Childhood Caries.'' The conference 
concluded that in many low-income preschool children--dental caries is 
under-treated. First tell me, if you can, why this is the situation? 
Especially with the existence of such programs as the Child Health 
Insurance Program and the State Medicaid program.
    Answer. Research conducted by the Agency's first dental Scholar-in-
Residence, in collaboration with individuals from the National Center 
for Health Statistics and the Health Care Financing Administration, and 
by the National Institute of Dental Research has identified the 
sociodemographic distribution of pediatric dental caries (cavities) in 
different age, ethnic and income groups. Once an almost universal 
condition of childhood, extensive caries afflicts disproportionately 
more low-income children today. The prevalence of untreated dental 
decay is approximately 4 times higher for the poor as it is for 
children from economically comfortable families, a situation which 
exists for very young children, older children, and adolescents.
    Care delivery issues are complex. Although both physicians and 
dentists have opportunities to prevent, intercept, and treat early 
childhood caries, oral health services are not well integrated with 
other services and assessments. Even if a physician detects the 
condition and refers the mother to seek dental care for her child, she 
faces other barriers to having her child actually receive care. Very 
young children present management challenges that reduce still further 
the number of dentists willing to schedule appointments for them. Low-
income parents frequently have not experienced regular dental care 
themselves, and many have not developed the skills nor awareness that 
allow them to assume responsibility for appropriate visits and recall 
appointments. Painful emergency treatment experiences that are common 
for low-income recipients of dental care often result in the 
development of permanent fears and avoidance of dental care.
    The October 1997 Early Childhood Caries Conference recommended that 
more research is needed to identify effective means of preventing and 
treating this problem, and it is clear that health services, 
behavioral, and biomedical research each have a role in identifying 
solutions. Only multifaceted approaches to address this problem are 
likely to be successful. Solutions depend upon synthesis and transfer 
of research findings, provider and public education, expanded provider 
base through effective extender utilization, coordination with primary 
pediatric medical care, and development of quality performance measures 
for health plans and population-based oral health care. Evaluation of 
demonstration programs can identify elements associated with success. 
Development and implementation of improved quality measures to assess 
the performance of outreach and care delivery components of future 
programs should create incentives for providers and plans to engage in 
coordinated care and be held responsible for the outcomes.
    Question. The Early Childhood Caries conference recommended that 
more research is needed to identify effective means of preventing and 
treating this problem. How much do you have in your 1999 budget to 
research this problem?
    Answer. Although the Agency has not specifically designated a 
portion of its budget for dental health services research in general, 
or to early childhood caries in particular, research on children's 
health has been designated a priority area in the fiscal year 1999 
budget. It is expected that up to $2 million will be devoted to 
improving the quality of children's health care. The general topic of 
quality also has been designated as a priority area in the fiscal year 
1999 budget, including development and implementation of improved 
quality measures.
    Research conducted by the Agency's first dental Scholar-in-
Residence, in collaboration with individuals from the National Center 
for Health Statistics and the Health Care Financing Administration, has 
identified the sociodemographic distribution of pediatric dental caries 
in different age, ethnic and income groups. Care delivery issues are 
complex. Although both physicians and dentists have opportunities to 
prevent, intercept, and treat early childhood caries, oral health 
services are not well integrated with other services and assessments.
    Question. As the U.S. population gets older, are there some special 
dental care problems faced by our senior citizens?
    Answer. Despite appreciable gains in oral health, certain groups 
still carry an extensive burden of oral disease. Among these are older 
adults and minority populations. Older adults who were born and spent 
their early years without the benefit of fluorides and other preventive 
therapies and who became acclimated to a pre-World War II delivery 
system exhibit an oral health status different from that of younger 
adults. Similarly, these older adults' values, beliefs and behaviors, 
despite formal education and sufficient income, may make them more 
vulnerable to oral diseases and their sequelae. Addressing the dental 
care needs of the elderly population is becoming more complex, as 
younger cohorts have more, often heavily repaired, teeth than earlier 
cohorts, and the maintenance of this health presents different 
challenges.
    The elderly have problems of untreated dental disease, problems 
with deterioration of previously repaired teeth and supporting 
structures, problems of complications of multiple chronic medical 
diseases, and problems associated with some of the treatments of those 
diseases, such as the many medications which cause ``dry mouth'' and 
increase the risk of dental diseases. The continued prevention and 
control of oral diseases and conditions in those groups of individuals 
who bear the burden of most of the problems requires a broad approach, 
involving numerous strategies, as well as the efforts and resources of 
many groups, organizations, and individuals.
    Having a regular source of care and/or regular dental visits and 
improved oral hygiene practices appears to be a promising avenue for 
the promotion of better perceived and clinically evaluated oral health 
status among most older ethnic groups. New initiatives may be required 
to reach those who may never have had a pattern of regular dental care, 
particularly minority and low-income elderly. However, even those who 
enter their senior years following regular receipt of care face new 
challenges associated with income, mobility, and other social factors. 
Complicating their situation further is the fact that many common 
dental treatment procedures for older adults are rendered in the 
absence of comprehensive knowledge of their expected results along most 
dimensions of treatment outcome, which limits the information available 
to practitioners. At a time in their life when financial resources 
become limited, many senior citizens are faced with treatment options 
whose benefits, relative to the costs, are difficult to assess without 
this information. If patients face financial barriers to receipt of 
necessary dental care, the outcomes of care for some medical conditions 
may be compromised.
    Question. Does your research agenda include addressing the special 
dental care needs of the seniors?
    Answer. In the early years of AHCPR, a series of studies was 
supported that addressed special dental care needs of the elderly, 
providing information for the health care professionals who care for 
them, and policy makers. Some studies looked at issues related to 
access to care, such as evaluation of a Medicare demonstration program 
to provide access to dental care for low income minority seniors, and 
evaluation of the effectiveness of a community-based geriatric nurse 
practitioner intervention targeting older-old adults (age 75+) to 
stimulate appropriate dental service utilization and improve oral 
health. Another study focused on methods to be used for outcomes 
research, specifically a self-reporting instrument to measure patient 
satisfaction and outcomes with dental implant procedures. Recently, 
findings were reported from a study addressing ethnicity, aging, and 
oral health outcomes, which included assessment of predisposing and 
enabling factors, dental care delivery systems, and sociodemographic 
population characteristics. This study suggests characteristics, such 
as an individual's care seeking attitudes, of people at highest risk 
for poor oral health outcomes and the kinds of policies that might 
improve those outcomes.
    Further research is needed to determine which measures work best to 
prevent and treat dental diseases that disproportionately affect older 
adults, such as root surface cavities, as well as technologies and 
approaches to screen for early stages of oral cancer. Research 
addressing the value of treatment for oral conditions on the outcomes 
of care for medical conditions is also needed.
    The Agency has funded NMES and MEPS providing important information 
on dental care. NMES and MEPS data are especially useful to better 
understand the dental needs for vulnerable populations such as children 
and the elderly. Specifically, NMES data collected in 1987 established 
a baseline level of use, expenditures and sources of payment for dental 
care for the U.S. population. MEPS data collected in 1996 and 1997 will 
be used to establish more current estimates for dental care utilization 
and make possible the identification of changes that have occurred 
during the previous ten years. Since NMES and MEPS are nationally 
representative data, analyses are very useful to describe dental access 
for vulnerable populations.
    Analyses of MEPS data will make possible estimates of the impact of 
retirement on the use, expenditures and sources of payment for dental 
care. Since dentistry is generally not covered by Medicare, retirement 
can result in the loss of dental coverage for many Americans. The 
impact of this loss of coverage has been difficult to estimate because 
panel data for a sufficiently large population has not been available. 
MEPS is a panel survey with data collected over two years. Sample size 
permitting, analyses of MEPS will allow for a description of the 
elderly as they move in one year from working to the next year into 
retirement. Also, as the population ages it is important to update 
current data for older Americans of different cohorts. MEPS will 
provide the most current and comprehensive data for each cohort within 
the elderly population.
       substance abuse and mental health administration [samhsa]
                          block grant formula
    Question. Last year's Labor/HHS Appropriations Act prohibited 
SAMHSA from implementing a proposed change in the way it allocates 
block grant funds to the States and the Conference Report indicated 
that this Committee would not increase funds for either of the State 
block grants until the authorizing Committees, SAMHSA, and the 
substance abuse and mental health communities have implemented a 
consensus policy regarding block grant formulas.
    What is the current status of the block grant formulas, and has a 
consensus been reached?
    Answer. It should be noted that the Secretary has no authority to 
change the Block Grant formula, except that which is granted in section 
1918 of the Public Health Service Act which applies only to the cost of 
service index. The House Committee on Commerce and the Senate Committee 
on Labor and Human Resources have jurisdiction over SAMHSA programs 
including the Block Grants, and they have the responsibility and 
authority to change the formula in statute should changes be necessary.
    In an effort to help forge a consensus, SAMHSA met with majority 
and minority staff of both Committees and explained the changes that 
the Secretary was making. At the request of Senator Frist, we, along 
with GAO, briefed staff of the members of the Labor and Human Resources 
Committee on the formula and the change from manufacturing to non-
manufacturing that the Secretary had authorized.
    On January 20 and 21, SAMHSA provided technical and financial 
assistance to a meeting of several State Directors of Substance Abuse 
and/or Mental Health Services to discuss the formula. In early 
February, we provided the same technical assistance to members of the 
National Coalition of State Alcohol and Drug Prevention and Treatment 
Associations at their annual conference. We have been and will continue 
to be available to brief any group who would like to become familiar 
with the formula and the issues involved.
    While various changes are being considered in both the House and 
Senate, no consensus has been reached.
    Question. If not, what are the major stumbling blocks?
    Answer. As members review the formula, they are trying to balance 
the need of their home State for funds and what makes good policy. We 
have confidence that an agreement will be reached, especially since the 
President has requested an additional $200 million for the SAPT Block 
Grant.
    Question. What do you believe is the most equitable way of 
implementing any new formula so that no State experiences an 
inordinately large decline in federal funding?
    Answer. The Secretary has recommended to Congress that new 
statutory authority be passed to phase in the changes caused by the 
shift from the use of manufacturing to non-manufacturing wage data over 
three or five years.
    Question. What assistance will SAMHSA provide to states which would 
lose significant funding?
    Answer. As pointed out earlier, it is our hope that the Department 
will be given authority to phase the change from the use of 
manufacturing to non-manufacturing wage data in over 3 or 5 years. The 
advantage of this is that States will be able to plan how they will 
make up for the loss of Federal funds. SAMHSA will assist them in 
prioritizing their activities. Moreover, the additional $200 million 
requested for the Substance Abuse Block Grant program will help prevent 
significant funding losses.
          knowledge development and application [kda] program
    Question. Madame Secretary, the new Knowledge Development and 
Application (KDA) program in SAMHSA is designed to identify and address 
policy and service delivery questions of national concern, as opposed 
to SAMHSA's previous policy of funding local substance abuse and 
treatment demonstration programs. Is there overlap in the new KDA's 
with existing programs?
    Answer. The KDA Program is designated to identify and address 
policy and service delivery questions important to communities, and it 
does so in several different ways. For example, the State Incentive 
Grants (SIG's) are a major component of the HHS Secretary's Youth 
Substance Abuse Prevention Initiative and play a key role in helping to 
achieve the outcome targets associated with this Initiative. SIG's are 
competitive grants to Governor's office which help coordinate disparate 
funding streams and facilitate the development of proven effective, 
prevention strategies at the local level aimed at reducing drug use by 
youth. This program serves as an incentive for Governors to examine and 
synchronize State-wide comprehensive prevention strategy with private 
and community-based organizations. In the five states recently awarded 
a State Incentive Grant in fiscal year 1997, the Governors have 
committed themselves to becoming actively involved in substance abuse 
prevention by direct involvement and oversight of this project.
    Another example is the Targeted Treatment Capacity Expansion 
Program designed to create and expand comprehensive substance abuse 
treatment services, promote accountability and enhance the quality of 
and access to treatment services. CSAT will support State, city, and/or 
other partners in efforts to identify gaps in the alcohol and other 
drug service delivery system, and where current capacity within a 
treatment modality is insufficient, provide for expanded access to 
treatment.
    As these examples show, the KDA Program directs resources to 
improving service quality in communities. It does not duplicate any 
other federal efforts, and in fact, has been expressly designed by 
SAMHSA to complement existing programs. The program serves several 
distinct purposes: to ascertain whether approaches that have a basis in 
research are effective in actual service settings; to communicate best 
practice information through such mechanisms as treatment improvement 
protocols; to ensure that high quality services in targeted areas of 
national interest are implemented nationwide; and to translate 
knowledge into practice, in particular through the Block Grants and 
other service programs. In short, the program helps ensure that SAMHSA 
and other federal efforts work in an integrated way at the community 
level.
    An example of this is the relationship between federal research 
programs and SAMHSA KDA's. Research projects generally represent long-
term studies of a wide variety of service topics, each inspired by an 
individual investigator. The results are of course immensely valuable 
in contributing to the knowledge base. However, given the variety and 
ever-changing dynamics of service delivery, practitioners may be 
unfamiliar with new research results, find them less relevant to their 
particular service needs, or be unable to change their practices for a 
wide variety of reasons. SAMHSA communicates continually with the field 
to assess their needs; an excellent example of how this is accomplished 
is through feedback from the extensive Block Grant technical assistance 
program. This feedback permits SAMHSA to design and develop shorter 
term, focused evaluations and knowledge application projects. They are 
coordinated to ensure that proven practices not only work when employed 
in public sector programs, but that these programs are implementing 
effective practices. No other federal programs have this as their 
mission. Similarly, other KDA-supported projects such as national 
clearinghouses and sponsorship of national information and public 
communication programs either represent a unique SAMHSA role, or are 
conducted jointly with other federal sponsors to prevent any overlap.
    Question. How is demonstration funding being phased out and KDA 
funding phased in?
    Answer. Consistent with the guidance received from the Committee, 
SAMHSA's former demonstration projects are being continued through 
their initial federal project period, which was up to five fiscal 
years. No new demonstration projects have been awarded since 1995. In 
the fiscal year following completion of a demonstration continuation 
project, a comparable amount of funds within the resource base is 
available to initiate new and more focused KDA projects targeted to the 
highest priority service issues. This phase in can of course be 
accomplished only if the overall KDA funding level remains level.
    Question. Which demonstration grant programs still receive funding?
    Answer. The Center for Mental Health Services (CMHS) will fund 
continuations for the Service System Improvement grants and AIDS 
Education I in fiscal year 1998. CMHS will fund only one Service System 
Improvement grant in fiscal year 1999. The Center for Substance Abuse 
Prevention (CSAP) will support 18 continuation grants funded under the 
Community Partnership program and 3 continuation grants funded under 
the old High Risk Youth program in fiscal year 1998. While we are 
phasing out the old High Risk Youth demonstration grants, the new High 
Risk Youth services grants will continue. For most of these projects, 
fiscal year 1999 reflects their last year of federal support for the 
grants.
    The Center for Substance Abuse Treatment has four demonstration 
programs continuing in fiscal year 1998. These are the Residential 
Treatment Program for Women and Their Children (RWC-15 grants), the 
Pregnant and Postpartum Women and Children Program (PPW-3 grants), the 
Criminal Justice Treatment Networks (7 grants), and the Rural Remote 
and Culturally Distinct Populations Program (3 grants). The majority of 
the grants for the Women's programs (RWC and PPW) and all of the 
Criminal Justice Treatment Network grants are planned to continue in 
1999. That will be the final year of funding for those programs.
    Question. How are the substance abuse and mental health 
communities' needs and concerns taken into account by SAMHSA in 
developing the new KDA's?
    Answer. Given the direct relevance of the KDA program to current 
service needs, continuing input from mental health and substance abuse 
service providers is vital to the success of the program. This is 
accomplished both through the active solicitation of input from the 
service field, as well as through information gained by the Agency as 
part of our continual involvement in service delivery issues. The 
former usually occurs through suggestions received from national 
organizations representing States, consumers and their families, 
service providers, and others. Their suggestions are factored into 
SAMHSA's agenda-setting process as potential grant announcements are 
considered each year.
    The second, more indirect aspect of field input regarding needs and 
concerns occurs during SAMHSA's continual communication with the field 
throughout the year. Information from State Needs Assessments, concerns 
raised during technical assistance visits to help implement Block Grant 
programs, views expressed in national meetings, information 
clearinghouse inquiries, and a wide variety of other communications 
help identify the most salient issues. Since there are many more needs 
identified than resources to address them, the final KDA agenda 
represents SAMHSA's careful selection of issues deemed to be of 
greatest need and broadest value to the field.
    Question. Do KDA's unnecessarily duplicate research efforts being 
conducted by the National Institutes on Drug Abuse (NIDA), Alcoholism 
and Alcohol Abuse (NIAAA), or Mental Health (NIMH)?
    Answer. We do not expect that there will be any duplication of 
research efforts being conducted by the former ADAMHA research 
Institutes. Our KD projects are based upon specific situations where 
the fact that approaches have not been tested in certain service 
settings creates an important gap in knowledge. We would not expect 
that NIH research projects would be based upon such very specific, 
highly applied research questions; that would be inconsistent with the 
NIH approach, where specific research questions generally are 
investigator-initiated. In addition, we meet regularly with the staff 
of the three Institutes to share information and identify areas of 
mutual interest for collaboration.
    Question. Would the purpose of the KDA's be better served by having 
the ``development'' portion administered by NIH instead of SAMHSA so 
that more of SAMHSA's discretionary funding could be used to provide 
direct assistance?
    Answer. As expressed above, SAMHSA has a unique role to play in 
knowledge development and application because of its extensive, 
continuing link to day-to-day issues of service delivery. Agency staff 
understand community service delivery programs; barriers to developing 
better service integration and linkage; problems faced by State, city 
and local governments in developing and managing comprehensive 
prevention and treatment programs; challenges posed by co-occurring 
disorders, homelessness, HIV/AIDS, and similar problems; and numerous 
other impediments to quality improvement in the service system and to 
achievement of better system-wide outcomes. This knowledge is essential 
to effective ``development'' activities. It is particularly important 
since the service field is not as well developed as it is in some areas 
of primary health care. While NIH plays an important role in the mental 
health and substance abuse areas, it is a quite different one. It is 
unlikely that an organization with a strong research orientation can be 
as effective in translating knowledge into practice, if de-coupled from 
service delivery programs and the understanding which derives from 
managing them.
                  programs in rural/native communities
    Question. A 1994 RAND Corporation study showed that living in a 
nonmetropolitan area was associated with higher needs for substance 
abuse treatment, especially in the areas of alcohol abuse. Substance 
abuse is a leading contributor to health problems among American 
Indians and Alaska Natives. Last year the Committee earmarked $10 
million for programs in rural and Native communities. What steps is 
SAMHSA taking to address the special needs of rural and Native 
populations?
    Answer. The fiscal year 1998 Senate Appropriations Report earmarked 
$4,000,000 for programs in rural and Native communities. CSAP has 
targeted these funds to provide continued substance abuse prevention 
support for ongoing native and rural programs. These programs 
constitute 10 percent of CSAP's continuation grant portfolio in fiscal 
year 1998. In addition, CSAP is providing targeted technical assistance 
and outreach to areas with rural and native focused programs, in 
particular Alaska, and encourage these programs to apply for new fiscal 
year 1998 substance abuse prevention initiatives.
    CSAP's fiscal year 1998 appropriation and fiscal year 1999 Budget 
request also supports new awards under the State Incentive Grant (SIG) 
program. The SIG program calls upon Governors to develop a statewide 
comprehensive prevention system directed at reducing youth substance 
abuse, including under-served populations in rural and Native 
communities. The program is designed to coordinate, leverage and/or 
redirect as appropriate and legally permissible, all Federal and State 
substance abuse prevention resources directed at communities, families, 
schools and workplaces. Community involvement is key to the success of 
these grants. Eighty-five percent of the grant funds will be directed 
to community based programs. These programs will be required to utilize 
scientifically defensible prevention practices. CSAP has awarded 5 
State Incentive Grants for fiscal year 1997: Illinois, Kansas, 
Kentucky, Oregon and Vermont. Approximately 15 more states will be 
funded in fiscal year 1998. The fiscal year 1999 budget request calls 
for an additional 2 new State Incentive Grants.
    There are two new programs for 1998, Exemplary Treatment Programs 
and Targeted Capacity Expansion, which will target the additional $3 
million for rural and Native American populations in the grant 
application process.
    Question. Are health care professionals being trained to treat 
these needs, and is there sufficient access to care in these 
communities?
    Answer. CSAT's Addiction Technology Transfer Centers (ATTC's) focus 
on the training needs most critical to the effectiveness of addiction 
treatment and recovery programs within each ATTC catchment area. They 
all focus on developing practitioners who are qualified to work with 
one or more special populations groups.
    While current routine reporting from the ATTC's does not include 
information on the number of trainees from rural or remote areas, the 
data indicate that nearly 220 Native Americans were trained in 1997. 
All of the ATTC's focus on reaching minority students and those 
individuals living in rural areas. In 1996, three ATTC's developed new 
training programs to address rural needs.
    There is a need to increase treatment availability for all 
substance abusing populations. It is for this reason that the 
Administration has requested a $200 million increase for fiscal year 
1999 in the SAPT Block Grant, in an effort to help close the treatment 
gap. Rural and Native populations present an array of challenges for 
service delivery including treatment availability and access and 
cultural differences. In order to address these and other types of 
treatment gap and comprehensive service issues, CSAT will continue the 
Targeted Capacity Expansion Program in 1999. This program allows 
States, cities and other governmental entities to create capacity and 
expand substance abuse treatment services where there are gaps in 
treatment availability. Rural and Native populations are being targeted 
for this program during the grant application process.
                        tobacco budget proposal
    Question. Elements of the tobacco settlement may involve major 
constitutional questions, especially with regard to advertising 
restrictions. If there is reason to believe that this proposed 
settlement may not pass or be sustained on a constitutional issue, then 
why should this Subcommittee base its important spending decisions on 
conditions that may not come to pass?
    Answer. We fully believe that a comprehensive bipartisan tobacco 
legislative package will be enacted by Congress this year, and that 
this legislation will contain the revenues needed to expand NIH 
research and the health research of CDC and AHCPR. These increases are 
a priority of the President, and we will work closely with the Congress 
to assure that the revenue source we have identified, comprehensive 
bipartisan tobacco legislation, will be in place this year to fund the 
President's priority for research into the twenty-first century.
    Question. If the tobacco settlement does not pass this session, 
which programs would you designate as your top priorities? How would 
you rearrange your priorities?
    Answer. The budget request includes the largest increase ever 
proposed for the National Institute of Health--a $1.15 billion, or 8.4 
percent, increase for fiscal year 1999. This is a long-term commitment. 
We propose to increase NIH funding by nearly half by 2003. Like every 
other priority of the President, we will work with the Congress to pay 
for these increases in spending. We fully believe that a comprehensive 
bipartisan legislative package on tobacco will be passed by the 
Congress, and that this legislation will provide the resources to 
expand NIH research spending, as well as the expanded health research 
efforts of CDC and AHCPR.
    Question. A constituent of mine, Hilary Koprowski of the 
Biotechnology Foundation, proposed to establish a research effort into 
using tobacco plants for healthier purposes, namely the production of 
vaccines. I understand that he has met with several government 
officials, including those from your department. Do you believe that 
such a proposal may be worth investigating?
    Answer. The field of biotechnology is expanding rapidly. Through 
advances in our understanding of genetic and other processes in 
molecular biology, there will soon be a variety of new products and new 
methods for producing useful products. Certainly a variety of plants, 
including the tobacco plant, should be examined in this research 
endeavor. Scientists like your constituent will ultimately provide 
information as to which plants will be most useful for vaccine 
development and other purposes. I would encourage your constituent to 
continue his research, in the hope that the tobacco plant, which has 
done so much harm to human health, could one day be used to promote 
health.
                                 ______
                                 
             Questions Submitted by Senator Lauch Faircloth
    Question. Both the FDA tobacco regulation and the Synar Amendment 
are directed at reducing minors' ability to purchase tobacco products. 
The Administration repeatedly refers to these efforts as 
``complementary.'' Will you explain to the Committee why two federal 
agencies are needed to enforce the prohibition against state sales to 
minors?
    Answer. It has been the intent of the Department for the SAMHSA and 
FDA efforts to provide a multi-level approach to addressing youth 
access to and availability of tobacco products. The SAMHSA Synar 
regulation is one piece in a comprehensive effort to reduce youth 
tobacco use. For such an effort to be successful, the Department must 
address issues of tobacco access, availability and appeal. While the 
FDA and SAMHSA regulations both address access and availability, Synar 
is not an enforcement program and Synar monitoring is not substitute 
for active enforcement of the FDA rule. The HHS response to youth 
tobacco use provides resources for enforcement activities, as well as a 
method of monitoring the success of State and Federal efforts. FDA rule 
enforcement is required to achieve the Administration's goal of 
reducing, by 50 percent over the next seven years, the young people who 
use cigarettes and smokeless tobacco.
    Under the Synar amendment States are required to conduct random, 
unannounced inspections of a representative sample of the State's 
tobacco vendors to assess their compliance with State access laws. 
States that fail to meet the goal of reducing violation rates to no 
more than 20 percent can lose a percentage of their federal Substance 
Abuse Prevention and Treatment Block Grant funds. The Synar activities 
are specifically designed to measure if stores are selling to minors, 
and this measurement provides SAMHSA with concrete evidence of the 
success of State enforcement efforts of their own State laws. The Synar 
provisions, although requiring the States to enforce their youth 
tobacco access laws, offer no specific financial support to States for 
such efforts.
    The FDA rule makes it a federal violation to sell cigarettes or 
spit tobacco to anyone younger than age 18 and requires retailers to 
ask for photo identification from anyone younger than 27. FDA 
activities are designed to actually enforce, not measure. The FDA 
regulations complement on-going State and local activities and 
establish mandatory conditions on the sale and distribution of tobacco 
products. The State agency administering the FDA rule must be an agent 
of FDA and funds are needed to pay State agencies. FDA needs 
flexibility to select non-Synar agencies to act as FDA agents, 
especially in poorly performing States. Enforcement of the FDA rule can 
only be done through compliance checks separate from SAMHSA, backed by 
fines, administered through FDA.
    Question. The Administration's budget calls for a $100 million 
increase in FDA funding for tobacco enforcement--and a $46 million 
increase for CDC's existing state tobacco-prevention activities. Please 
detail for the Committee the differences in these two programs, and 
what procedures HHS has in place to ensure that these programs are not 
duplicative?
    Answer. FDA's tobacco programs seek to restrict access to tobacco 
products, while CDC programs are targeted to reduce the demand for 
cigarettes. As FDA fully implements the tobacco rule and expands their 
activities to the full extent of the law, there will be increased 
workload and a need for increasing appropriations, $100 million in 
fiscal year 1999. The fiscal year 1999 goals for the FDA tobacco 
program include a significant expansion of the outreach and enforcement 
activities initiated in fiscal year 1998. With this increased funding, 
FDA can ensure fundamental progress in all States, through partnerships 
with States and local authorities, to reduce use of tobacco products 
among our nation's youth. FDA will primarily engage in enforcement, 
outreach, and product regulation.
    FDA has developed a general enforcement strategy aimed at 
conducting compliance checks in a significant percentage of the roughly 
400,000 retail outlets that sell tobacco products. FDA will commission 
State and local officials to conduct unannounced purchase attempts 
using young people under the age of 18. FDA follow-up enforcement 
includes special monitoring projects, demonstration projects, and an 
enforcement strategy for national chains. Evaluation activities include 
an inquiries and reporting system and other legal requirements. The 
outreach activities include compliance outreach, trade advertising and 
direct mail targeted to retailers and clerks, advertising, and media 
and public education. A strong outreach program is one of the most 
effective ways of increasing compliance with this rule. In fiscal year 
1999 FDA plans to intensify its advertising campaign and use community 
organizations, parent groups, voluntary health groups, and the media to 
raise awareness of the tobacco rule and encourage compliance. FDA will 
design and, to the fullest extent permitted under law, begin to 
implement a regulatory program for cigarettes and smokeless tobacco 
products under the Food, Drug, Cosmetic Act. This includes a procedure 
for the classification of devices to determine the level of controls 
required by the products' characteristics to provide a reasonable level 
of safety, a process of reviewing and analyzing ingredients used in 
cigarettes and smokeless tobacco, establishing a framework for the 
evaluation and review of new and existing cigarette and smokeless 
tobacco products, and beginning the inspection process by reviewing the 
practices of tobacco companies.
    The CDC increase of $46 million for tobacco prevention programs 
will fund a nationwide program that recognizes prevention and reduction 
of tobacco use is a core public health function. This will replace and 
expand CDC's Initiative to Mobilize for the Prevention and Control of 
Tobacco Use (IMPACT) program to include all 50 States and the District 
of Columbia. The IMPACT program funds a number of prevention and 
control activities which include training and programmatic support for 
school-based smoking cessation programs, national surveillance 
activities, state prevention and control plans to protect nonsmokers 
from exposure to environmental tobacco smoke, and state programs to 
address oral cancer in high risk populations. This will also replace 
the NIH's American Stop Smoking Intervention Study (ASSIST). Of the CDC 
increase, $22 million of the $46 million funds NIH had been granting to 
States through the ASSIST program.
                                 ______
                                 
               Questions Submitted by Senator Larry Craig
    Question. It has been said that most states aren't using all of the 
monies they are allotted through the Child Care and Development Block 
Grants. Could you please comment on why you think the states aren't 
utilizing the money that is being sent to them? And in view of that, 
why is the Administration proposing an increase in spending in this 
area?
    Answer. In fact, States are utilizing the money that is being sent 
to them and we do project that the States will spend virtually all of 
their child care funds. The State financial reports received thus far 
are very encouraging and show that States have obligated over 99 
percent of the fiscal year 1997 child care funds available to them 
under the new welfare law. States have outlayed 90 percent of their 
child care funds for fiscal year 1997 and we project they will expend 
all their funds within the time frame allotted. The outlay rates for 
1998 are also quite strong and we project that States will expend all 
their funds within the two years as required.
    The passage of the Personal Responsibility and Work Opportunity 
Reconciliation Act made major changes in the funding for State child 
care programs, and it was expected that States would require some time 
to make the transition. However, despite these significant reforms in 
the program, States reacted quickly and have drawn down the vast 
majority of child care money.
    There is a tremendous need for child care assistance, particularly 
among low income working families. While our most recent data from 1995 
indicates that funds in that year allowed us to serve over about 1 
million children, that is a small percentage of those eligible since 
there are approximately 10 million children eligible for the Child Care 
and Development Block Grant. Further, without assistance, working 
families with annual incomes under $14,400 who pay for care for 
children under five spend 25 percent of their incomes on child care--
even then, it's difficult to find accessible, high-quality care.
    Question. Doesn't the Administration's child care proposal amount 
to a return to categorical programs in essence saying we shouldn't 
trust the states with block grants? Does the Administration have a 
complaint with how the states are handling block grants?
    Answer. The Administration's child care proposal does not return to 
categorical programs and we continue to support the consolidation of 
child care that took place in the Personal Responsibility and Work 
Opportunity Reconciliation Act. We do not have problems with how States 
are handling block grants, and that is partially why the President has 
proposed an increase in the block grant program of $7.5 billion over 5 
years. We feel like States are working hard to provide child care for 
working families and continue to want to support them and provide for 
the additional funds they need.
    The President's Child Care Initiative does not create a lot of new 
programs; it builds on three of its primary programs: Child Care 
Development Block Grant and child care entitlement money, Head Start, 
and Child and Dependent Care Tax Credit. All of the components of the 
President Initiative would be included in the Child Care Development 
Block Grant so that States have more funds to assist working families 
in finding and keeping higher quality child care. Over 95 percent of 
the funds in the President's initiative go to States, communities, 
businesses and families to support their choices.
    Question. Data clearly show that low- and middle-income families 
are just as likely as, if not more likely than, higher income families 
to have one spouse in the paid work force and the other in the home. 
Stay-at-home spouses work full time as care givers, schedulers, travel 
managers, culinary experts, home repair engineers, and home economists 
and frequently volunteer many additional hours in school and community 
activities. In short, all moms work. Why, then, do the Administration's 
child care proposals target assistance to two-earner families, and 
neglect the one-earner families who are, if anything, more economically 
overburdened?
    Answer. Our child care initiative builds on President Clinton's 
record of providing real choices and opportunities for parents--
including the choice to stay home with their children. He has worked to 
enact: a $500 per child tax credit that provides $98 billion in tax 
benefits over the next 5 years for 26 million families with children 
including those with stay-at-home mothers; the Earned Income Tax Credit 
also helps stay-at-home mothers and gives 15 million working families 
$150 billion over the next five years in tax relief; health insurance 
for children; increases in the minimum wage; and the Family and Medical 
Leave Act. The Administration is committed to helping parents make the 
choices that are right for their families, whether that means working 
or staying home to care for their children.
    The President's Child Care Initiative is primarily oriented toward 
families with a single parent who works or two parents who both work, 
usually for reasons of financial necessity. According to the March 1997 
Current Population Survey, only 26 percent of families with children 
under age 14 have a stay-at-home mother. Seven out of every 10 mothers 
of children under age 6 spent some time in the labor force during the 
past year. The initiative is designed to ensure that children in these 
families receive quality care while their parents are working.
    The President believes strongly, however, that we should support 
parents who have sufficient resources and who choose to stay home. The 
Administration's proposal includes provisions that will help parents 
who stay at home. It will support demonstration projects in States and 
communities to test policies to help new parents who choose to stay 
home to care for their newborns and newly adopted children. In 
addition, the President's Early Learning Fund supports parents who stay 
at home through home visits and parent education.
    Question. Why did the President suggest that surpluses be dedicated 
to protecting Social Security when everyone knows that Medicare is 
facing a more imminent crisis?
    Answer. The President is committed to addressing the long-term 
needs of the Medicare program and has worked hard to protect and 
strengthen this vital program. The Balanced Budget Act enacted last 
year by the President and Congress saves $150 billion over 5 years and 
extends the life of the Medicare Trust Fund for more than a decade.
    In addition, the Medicare Commission agreed to as part of the 
Balanced Budget Act has begun its work and will present recommendations 
for addressing Medicare's long-term financing needs by the Spring of 
1999. The President has appointed a distinguished group of individuals 
as his representatives to the Medicare Commission. The President is 
committed to working with the Commission to find ways for the program 
to meet the longer-term financing challenges that confront it.
    At the same time we are addressing Medicare's future, the President 
recognizes the long-term needs of the Social Security program, which 
without any changes, will become insolvent after 2029. That is why in 
his last State of the Union address, he asked the Congress to set aside 
every penny of any budget surplus until the President and Congress deal 
with Social Security first In January of 1999, the President intends to 
convene the leaders of Congress to draft a plan to save Social 
Security. The Administration is encouraged by the favorable response 
from both parties in Congress to the President's call to address Social 
Security before spending any future surplus.
    If we act now, we can ensure strong retirement benefits for the 
Baby Boom generation without placing an undue burden on our children 
and grandchildren. And, if we act now, any changes will be far simpler 
and easier than if we wait until the problem is closer at hand. For 
example, a $100 billion budget surplus, if used for Social Security, 
would add a year or more to the solvency of the Social Security Trust 
Fund with no other changes being made. Other changes enacted now could 
be phased-in over time, thereby minimizing their immediate impact. 
Small changes made now will have huge impacts in 30 years.
    The President understands that there are many worthy programs and 
initiatives on which to spend any budget surplus. He welcomes such a 
dialogue. However, he believes that before a dime of any surplus is 
spent, the Administration and Congress should develop a plan to save 
Social Security for generations to come.
    Question. Instead of dedicating potential revenues from a tobacco 
settlement to the immediate gratification of new domestic spending, 
wouldn't it be more responsible to set aside any new revenues in this 
area to the long-term need of protecting Medicare?
    Answer. The President's investment priorities for tobacco 
legislation are aimed at protecting children from diseases and 
investing in their future through health care coverage, child care, and 
education; improving the lives of current smokers through health 
research and smoking cessation programs; and protecting farmers. The 
Administration believes that these investments have a natural link to 
tobacco receipts.
    The President shares the Republicans' concerns about the Medicare 
program. No President has done more to protect and strengthen this 
vital program. Just last year, working with the Congress, the President 
signed into law a package of unprecedented savings--$150 billion over 5 
years--and structural reforms that extended the life of the Medicare 
Trust Fund for the next decade. He recently appointed a distinguished 
group of individuals as his members of the Medicare Commission. The 
President is committed to working with the Commission to find ways for 
the program to meet the longer-term financing challenges that confront 
it.
                                 ______
                                 
          Questions Submitted by Senator Kay Bailey Hutchison
    Question. Secretary Shalala, when do you anticipate that the final 
Temporary Assistance for Needy Families (TANF) regulations will be 
issued?
    Answer. We are planning to publish final rules in August of this 
year.
    Question. Proposed TANF reporting regulations would require States 
to make significant changes in their reporting and data collection 
systems, diverting limited resources from client services. Will the 
final rules ensure that only the minimum amount of data is required and 
that States be given an adequate time to come into full compliance with 
final reporting requirements?
    Answer. We have received numerous comments on the proposed scope of 
the TANF data reporting. We are currently analyzing the comments we 
received. While it would not be appropriate to speculate on the nature 
of data collection under the final rule, we are re-evaluating each data 
element to determine if it is necessary to carry out our 
responsibilities under the statute to monitor the program, determine 
work participation rates, assess penalties, and provide information to 
Congress on the impact of welfare reform under the TANF program. We are 
aware of the burden this new data system places on States and will look 
for ways to streamline these reporting requirements.
    Question. Many States, including Texas, operate their TANF programs 
under waivers approved by the Secretary. These States have relied upon 
the integrity of their waivers while setting overall program strategy 
and operational policies. Section 415(c) of the Personal Responsibility 
and Work Opportunity Reconciliation Act asserts that the Secretary 
``shall encourage'' States to continue such waivers. Many States argue 
that the proposed rules actively discourage States from continuing 
waivers by narrowly defining waiver inconsistencies. Does the 
Department agree with the clear intent of the PRWORA to allow States to 
fully maintain their waiver-driven programs? Will the final rules 
reflect that legislative intent?
    Answer. Section 415 of PRWORA allows States to delay applying 
provisions of TANF ``to the extent such amendments are inconsistent 
with'' their waivers. In drafting the Notice of Proposed Rulemaking 
(NPRM), we sought to propose rules defining waiver inconsistencies that 
would allow States the flexibility to continue IV-A program policies to 
the extent they were inherent to their waivers while assuring 
accountability to meeting TANF requirements established under the law.
    The comment period on the TANF NPRM has just closed and we are in 
the process of reviewing the comments we received at this time. We will 
carefully consider comments like you have cited in making decisions 
concerning the final rules.
    It is our intention to issue final rules that will be entirely 
consistent with the law and with Congressional intent. We are currently 
reviewing all the comments we received on the proposed rules and will 
give them full consideration as we draft final rules.
    Question. States operating under an approved waiver may desire to 
gradually move their waiver-based initiatives and program rules closer 
to those found explicitly in federal statutes. Would the Department 
allow such a State to move gradually toward federal law on a voluntary 
basis without invalidating the rest of the State's waiver?
    Answer. There is no mechanism for modifying IV-A waivers approved 
prior to a State's enactment of TANF.
    However, we have advised States that they have full discretion 
concerning decisions to terminate any specific waiver at any time. For 
example, a State could choose to retain a waiver related to time-
limited assistance, but terminate a waiver allowing a particular work 
activity not otherwise countable under TANF.
    Similarly, we have advised States that they may unilaterally modify 
a specific waiver to the extent the modification brings the waiver into 
closer compliance with TANF. For example, they could decide that one of 
the classes of recipients now exempt from time-limited assistance under 
their waiver will henceforth be subject to the time limit; or, in 
conjunction with allowing devolution of program policies to counties, 
allow counties to decide whether to continue to count a specific work 
activity allowed under the waivers.
    On the other hand, they could not modify their waiver to exempt a 
new class of recipients subject to the time limit under their waiver as 
that would increase the inconsistency; nor allow waiver policies 
inconsistent with TANF approved for application in a pilot site to be 
expanded statewide, as this would serve to increase inconsistencies 
with TANF.
    Question. Original communication from the Department indicated that 
States would be allowed to develop an alternative participation rate 
methodology to account for State initiatives that expanded TANF program 
eligibility. The proposed rules did not contain such a clause. Will the 
final rules ensure that States are not penalized in terms of their 
participation rates for TANF program eligibility expansions?
    Answer. The comment period on the TANF NPRM has just closed and we 
are in the process of reviewing the comments we received at this time. 
We will carefully consider comments like the ones you have cited in 
making decisions concerning the final rules.
    Question. In 1994, Congress authorized a Border Health Commission 
to address health problems that affect the population of the U.S./
Mexico Border. In last year's Labor/HHS appropriations bill we 
appropriated $800,000 to fund this vital commission. When do you intend 
to move forward with establishing this commission?
    Answer. I am pleased to inform you that we are moving forward 
toward establishing the U.S.-Mexico Border Health Commission. The 
Office of Public Health and Science's Office of International and 
Refugee Health has been working with the four U.S. border States to 
establish the U.S. side of the Commission. On March 3, the White House 
forwarded letters to the Governors of these States, requesting 
nominations of individuals to serve as Commission members. In addition, 
we are in the process of contacting the Health Commissioners of these 
States about also serving as members of the Commission. In fact, the 
Commission was discussed during a recent meeting between the Health 
Commissioner of Texas and the Assistant Secretary for Health/Surgeon 
General. We consider the Health Commissioners and their respective 
Border Health Offices to be key participants in the Commission's 
development process.
    The primary goals of the Commission are to institutionalize a 
domestic focus on border health which can transcend political changes, 
and to create an effective venue for bi-national discussion to address 
public health issues and problems which affect our U.S.-Mexico border 
populations. To realize these goals, HHS has also proceeded on several 
fronts regarding Mexico's involvement: we have re-opened informal 
dialogue with officials from Mexico's Ministry of Health regarding 
their critical partnership in the development of the Commission, and we 
have formally requested the Department of State to initiate discussions 
with the government of Mexico regarding their potential participation 
in the Commission.
                                 ______
                                 
               Questions Submitted by Senator Tom Harkin
    Question. Our fiscal year 1998 appropriations bill included 
additional funds for the Early Head Start program. I am glad to see 
that the President's budget also increases funding for Early Head 
Start. Madame Secretary, can you tell something about what you have 
been doing with those additional funds?
    Answer. Early Head Start programs provide early, continuous, 
intensive, and comprehensive child development and family support 
services on a year-round basis to low-income families with children 
under the age of three and pregnant women. In fiscal year 1999 Early 
Head Start (EHS) spending will total $350 million, an increase of +$71 
million over fiscal year 1998. This spending will be used to increase 
projected enrollment by an additional +10,000 children for a projected 
total of 49,000 children in fiscal year 1999. Funding will also allow 
EHS to focus on four cornerstones of providing quality programs: child 
development, family development, community building and staff 
development. EHS technical assistance includes on-site training for 
teachers and staff and regional office staff. In addition, Head Start 
will monitor all EHS programs in their first year of operation with 
teams consisting of experts in the field and Federal staff.
    Question. Last year, this Committee provided an additional $50 
million in the Child Care Block Grant to activities that improve the 
quality of care for infants. What has your Department done to make sure 
that those funds go to increasing quality and not just supply?
    Answer. This March the Department has sent a letter to all Child 
Care Development Block Grant (CCDBG) State administrators explaining 
that in fiscal year 1998 Congress appropriated an additional $65.139 
million for CCDF and that $50 million is earmarked for quality and 
$18.59 million for resource and referral activities. The letter 
included a table of State allocations, including the minimum amounts 
States must spend on quality and resource and referral activities. It 
was also noted that these funds are in addition to any expenditures 
necessary to meet the ``not less than 4 percent quality requirement.'' 
While we cannot specify what type of quality activities are undertaken, 
we have also provided CCDBG Agencies with a list of suggestions for 
activities in such areas as monitoring of child care programs, training 
curriculum, child care networks, and scholarships/grants as well as a 
summary of innovative programs already in existence.
    Question. As you know, the President's budget essentially pays for 
the NIH increase with tobacco proceeds. I have been saying for years 
that we need another source of funding for biomedical research. Madame 
Secretary, what advice do you have for us on how to get those tobacco 
proceeds available to this Committee to fund a NIH increase?
    Answer. We fully believe that a comprehensive bipartisan tobacco 
legislative package will be enacted by Congress this year, and that 
this legislation will contain the revenues needed to expand NIH 
research and the health research of CDC and AHCPR. These increases are 
a priority of the President, and we will work closely with the Congress 
to assure that the revenue source we have identified, comprehensive 
bipartisan tobacco legislation, will be in place this year to fund the 
President's priority for research into the twenty-first century.
                                 ______
                                 
                Questions Submitted by Senator Herb Kohl
    Question. Secretary Shalala, one part of the President's budget 
that I am interested in is a demonstration project run by the 
Education, Health and Human Services, and Justice Departments that 
would coordinate Federal after-school programs. I understand that this 
initiative is to designate three to five pilot cities and show how we 
can coordinate all the various government programs that serve children 
after school. How will the pilot cities be chosen? Obviously, I believe 
Milwaukee would be a great site for this project. Will you help guide 
them through the process and make sure they receive serious 
consideration?
    Answer. The initiative you are referring to was part of the Child 
Care Initiative announced by the President on January 7, 1998. The 
President announced at that time a collaborative effort involving 
numerous federal agencies to eliminate duplication and better 
coordinate existing federal funding for after-school programs in three 
to five pilot cities, including the District of Columbia. A working 
group within the Administration has been formed to put this 
collaborative effort in motion. It comprises of representatives from 
HHS, Department of Education, the Justice Department, as well as other 
interested federal agencies. This working group will be looking at 
previous collaborative efforts to gain some lessons learned as criteria 
is developed for considering other cities that may be included as part 
of this effort. The key goal of this initiative is healthy development 
and learning, and not custodial. I will communicate to the working 
group your interest to have Milwaukee be considered as one of the 
possible sites and your concern that this effort not be focused on 
custodial issues.
    Question. Last year, the Milwaukee Journal-Sentinel ran a series of 
articles focusing on the prevalence of elder abuse by health care 
workers, many of whom had prior criminal histories. Similar stories 
have appeared nationwide, and abuse is not isolated to nursing homes. 
To respond, I have introduced and continue to work on legislation that 
would create a national registry of abusive long-term health care 
workers, and require criminal background checks for prospective 
employees of long-term care facilities. This will make sure that 
abusers cannot travel from state to state and continue to prey on 
vulnerable patients. Would you support such a proposal and work with me 
to push for its passage? Will you help me move this along this year by 
also looking for a way to do this administratively?
    Answer. We would be happy to review your proposed legislation when 
it is completed. As you are aware, this Department is in the forefront 
of weeding out poor health care providers from the Medicare and 
Medicaid programs using the tools provided by Health Insurance 
Portability and Accountability Act of 1996 (HIPAA) and the Balanced 
Budget Act of 1997. We are currently working on developing the 
Healthcare Integrity and Protection Data Bank established in HIPAA 
which will eventually catalogue all health care providers with adverse 
actions against them. Regarding criminal background checks of health 
care workers, the HHS Office of Inspector General (OIG) performed two 
State audits with supplemental work in nursing homes and several other 
States to get a sense of the value of performing background checks for 
nurse aides. Based on the OIG's information which is not statistically 
valid for projecting nationwide, they believe that background checks 
may have merit and that their application to nursing home aides and 
perhaps others who have access to patients in long term care facilities 
should be seriously considered. A number of nursing home officials 
indicated that background checks were especially helpful in screening 
prospective employees. Further, they believed checks reduced instances 
of abuse by deterring applicants with criminal histories.
    As you are also aware, nurse aide registries were established by 
OBRA 87. The law required that States maintain a registry of all nurse 
aides who have satisfactorily completed a nurse aide training and 
competency evaluation program. It also required that the registry 
should include specific documented findings by a State of resident 
neglect, abuse, or misappropriation of resident property involving an 
individual listed in the registry. The registry, however, is for nurse 
aides only, and does not apply to all long term health care workers. 
OBRA 97 also did not mandate criminal background checks for prospective 
employees of long term care facilities. We would be happy to discuss 
this important matter with you and your staff.
    Question. The President's $20 billion child care proposal contains 
over $5 billion in spending that goes through this Subcommittee 
spending for programs like teacher scholarships, child care facility 
inspections, and after-school programs. Currently, that money is 
considered outside of our spending caps, and the President has 
suggested paying for it with part of the revenues from a new cigarette 
tax. Will the Administration still stand by its child care proposal if 
we are unable to reach agreement on a new tobacco tax?
    Will you suggest some offsets to help this Subcommittee find the 
money to fund your child care priorities?
    Answer. As the President has said, every initiative in his budget 
submission, including the child care proposals, will be paid for within 
the context of a balanced budget. The budget we send to Congress will 
have a number of proposals to pay for new initiatives like this one--
including tax proposals and other spending offsets. The child care 
package is funded in a variety of ways--some on the mandatory side and 
others on the discretionary side of the budget. Of the President's 5 
year, $21.7 billion request, $7.5 billion is funded out of expected 
tobacco revenue and is requested for a mandatory increase in child care 
subsidies.
    The proposed $5.1 billion fiscal year 1999 program level for child 
care includes an appropriation request of $1.182 billion in 
discretionary funds, $2.167 billion in pre-appropriated mandatory funds 
for the child care entitlement, $1.755 billion in mandatory increases 
for subsidies and the Early Learning Fund. Of this $1.755 billion, 
$1.155 billion is for subsidies funded out of tobacco revenue.
    Our budget does assume that Congress will pass tobacco legislation, 
and we believe that they will. It is a top priority for the President, 
and it has bipartisan support. We are committed to working with 
Congress to pass this important legislation.
    As noted above, we support the Presidential priority of finding 
child care funds and will work with Congress to find other offsets if 
tobacco legislation is not passed.
    Question. Last October, Time Magazine published a disturbing 
article describing how few nursing homes that are cited for 
deficiencies are actually penalized. I understand that the 
Administration is requesting $167 million for Survey and Certification 
activities, which are responsible for inspecting facilities to make 
sure they comply with health and safety standards; and impose penalties 
on those who violate standards. However, I am concerned that $62 
million of this would be available only if legislation is passed to 
require user fees. Does the Administration have a contingency plan in 
the event that user fees are not accepted by Congress? Do you agree 
that we should make this increase a priority regardless of the passage 
of user fees?
    Answer. In order to effectively perform Medicare survey and 
certification activities in fiscal year 1999, the Administration 
requests a program level of $167 million. This includes a $104.7 
million appropriation request plus $62.3 million in proposed 
discretionary user fees. The full $167 million funding level is needed 
to provide the necessary resources for us to keep pace with the 
continuous growth in this program. More specifically, the request will 
support inspections of all facilities seeking to participate in 
Medicare for the first time as well as re-inspections of all currently 
participating nursing homes and home health agencies that are 
statutorily mandated. Also, the request supports inspections of a 
minimum of 10 percent of non-statutorily mandated facilities.
    Full funding of our proposed discretionary user fees is crucial to 
our ability to maintain priority program operations, including survey 
and certification activities. Insufficient funding to conduct on-site 
inspections of health care facilities could jeopardize the quality of 
care provided and place beneficiary health at risk. Without a user fee 
to supplement our appropriations request, HCFA's ability to survey new 
providers will be compromised, as will its ability to perform all of 
the statutorily-mandated surveys for those providers that are already 
participating in our programs. The Administration is eager to work with 
both this Committee and the authorizing committees to fully enact our 
user fee request.
    Question. After the Time article was published, Senator Reid and I 
wrote to you expressing our outrage at the disparity between citations 
and penalties. To date, we have not received a reply. What has the 
Administration done to address the problems raised by the Time article?
    Answer. HCFA is currently developing initiatives to respond to the 
Time Magazine article, including better ways to target current poor 
performers, prevent and penalize resident abuse, and develop more 
focused survey guidance on nutrition and hydration requirements. We 
believe these activities will greatly improve the nursing home survey, 
certification and enforcement process.
    For the record, I have included a copy of the letter I wrote in 
response to Senator Reid; an identical copy of this letter was sent to 
your office as well.
    [A copy of the letter follows:]

           Department of Health and Human Services,
                                   Office of the Secretary,
                                    Washington, DC, March 10, 1998.
Hon. Harry Reid,
U.S. Senate,
Washington, DC.
    Dear Senator Reid: Thank you for your letter of concern about 
nursing home enforcement. Let me preface my response by saying that I 
appreciate your deep concern for the nation's elderly nursing home 
residents and your offer to collaboratively improve the processes used 
to ensure quality care. I apologize for the delay in responding.
    I, too, am disturbed by the allegations and information that 
appeared in the October 27, 1997, issue of Time magazine. The General 
Accounting Office is investigating these charges, and we will, of 
course, fully cooperate with this effort.
    Regarding your broader concerns about the nursing home enforcement 
process, the Health Care Financing Administration (HCFA) is preparing a 
report to Congress that will examine these very questions. The report, 
which will be sent to Congress in the Spring, will include an analysis 
of the effectiveness of the survey and enforcement systems, a 
comparison of the current survey and accreditation process, and a 
discussion of the regulatory and non-regulatory incentives for 
improving care. The information in the report will provide us with a 
solid foundation for determining whether changes may be needed to the 
present survey, enforcement, and accreditation process, including any 
necessary Congressional action.
    You ask why so few citations are acted upon and what procedures are 
in place to process citations and recommendations. Under the current 
process, when a survey occurs and a facility is found out of compliance 
with nursing home requirements, most nursing homes are afforded an 
opportunity to correct their deficiencies. If the nursing home is 
unable to make the corrections within three months of being found out 
of compliance, the law requires that a sanction be imposed. Most 
nursing homes are able to make corrections and achieve substantial 
compliance within that three-month period. However, if a nursing home's 
care represents an immediate threat to the health and safety of nursing 
home residents or otherwise is considered a poor performer, sanctions 
are put in place immediately. The procedures for sanctioning a nursing 
home only occur after the state makes a recommendation for HCFA to take 
an action. This usually occurs after the nursing home has been given an 
opportunity to correct the deficiencies but failed to achieve 
compliance. When this happens, HCFA sends out an official notice and 
sanctions become effective after the notice period (between 2 to 15 
days after the date the notice is received).
    In answer to your question about how decisions are made as to which 
facilities are sanctioned, the state survey agency (HCFA's agent) makes 
recommendations for sanctions based on its inspection of the nursing 
home and subsequent follow-up visits to the nursing home. The final 
decision is made by the state Medicaid agency for Medicaid-only nursing 
homes and HCFA for all others. HCFA and the state Medicaid agency 
impose sanctions at the third month after the date noncompliance was 
found, and terminate a facility at the sixth month after the date 
noncompliance was found if a nursing home fails to achieve compliance.
    In addition, HCFA is developing initiatives that are aimed at 
specific issues raised in the Time magazine article. These initiatives 
include ways to target current poor performers, prevent and penalize 
resident abuse, and develop more focused survey guidance on nutrition 
and hydration requirements. We believe these activities will greatly 
improve the nursing home survey, certification, and enforcement 
process.
    Thank you for your interest in this aspect of the Medicare and 
Medicaid programs. I look forward to continuing to work with you to 
improve quality of care and life for the nation's elderly. A similar 
letter is being sent to Senator Herb Kohl who co-signed your letter.
            Sincerely,
                                          Donna E. Shalala,
                            Secretary of Health and Human Services.
                          balanced budget act
    Question. Last year's Balanced Budget Act included significant 
changes to the Medicare program which will ensure Medicare's solvency 
for the short-term. Included in these changes was an increase in 
payments to HMO's and other private plans under the Medicare+Choice 
program. The new $367 payment floor and blended rates are an 
improvement, but Wisconsin counties still have the fourth lowest 
payment rates per Medicare beneficiary in the nation. This will 
seriously limit choices for seniors in Wisconsin, as few HMO's or other 
plans will participate in Medicare in a State where the payment rate is 
so low. Does the Administration have a proposal to address this 
problem?
    Answer. As your question mentions, the new Medicare+Choice program, 
established under the BBA, changed the payment formula for managed care 
plans under Medicare. This change was an attempt to raise the payment 
levels in low-cost, mostly rural areas, in order to induce managed care 
companies to offer plans in these areas. Specifically, a new payment 
floor was established at $367 per member per month nationwide for 1998. 
This will mean that the lowest county payment has increased from $221 
to $367 per month. This figure will be adjusted upward in future years, 
primarily according to the growth in per-capita Medicare spending.
    In addition, a new blended county rate was also established under 
BBA. This new rate, as opposed to the old rate which was based 100 
percent on local costs, will blend national rates and local rates over 
a six year period. By 2003, the blend will be fully implemented at 50 
percent local and 50 percent national rates. Each local area will 
receive the highest of the possible rates produced by the payment 
floor, the 50/50 blend, or the minimum update for high cost areas. We 
believe that these higher rates for low-cost areas should have a 
positive effect on plan establishment in these areas. We will continue 
to monitor the developments in this area to see whether any 
recommendations to the Congress are warranted in the future.
    Question. The Long-term Care Ombudsman program serves as an 
advocate for the elderly by pursuing cases of abuse and neglect. Often, 
it is the Ombudsman program that serves as the only voice for frail and 
elderly people. The Administration has requested flat funding for the 
Ombudsman program; yet, the programs already do not have enough staff 
or resources to respond to existing inquiries. Shouldn't the 
Administration place a greater emphasis on the Ombudsman program?
    Answer. The Administration's funding requests are made within the 
context of the need to balance the budget and of larger funding 
priorities. Most of the funding for Ombudsman services comes from Title 
III monies which the State and area agencies commit to Ombudsman 
programs, rather than from designated Ombudsman money in Title VII. 
With the recent increase in total Title III funding, State and area 
agencies may commit additional funding to Ombudsman services, depending 
on their individual priorities.
    The Administration on Aging (AoA) works in partnership with the 
States' Long-Term Care Ombudsman Programs to emphasize the significant 
role provided by Ombudsman staff and volunteers. Through the provision 
of on-going training, guidance and reviews of best practices, AoA 
consistently focuses on maintaining and improving the quality and 
effectiveness of the Ombudsman program, and recognizes its important 
on-going efforts for HHS's Operation Restore Trust. Finally, AoA has 
proposed a consolidation of the Title VII programs that serve 
vulnerable elders. A base amount of this consolidated funding would be 
earmarked for Ombudsman services, so that their continued significance 
would be ensured even under level-funding.
                                 ______
                                 
             Questions Submitted by Senator Robert C. Byrd
                              venipuncture
    Question. A provision of the Balanced Budget Act of 1997 (BBA) 
eliminated qualification for home health care services based on the 
need for venipuncture, or blood draw, services. This provision has 
raised great concern in West Virginia and around the nation. Homebound, 
frail elderly Medicare beneficiaries are frightened that they will no 
longer receive the home health services they need to remain in their 
homes and to remain healthy. While I support efforts to combat Medicare 
fraud and abuse, I am concerned that the venipuncture provision was not 
well thought out and that homebound, elderly Medicare beneficiaries' 
health will be jeopardized by this provision. In some rural areas of 
West Virginia we do not have ``traveling labs'' that will go back into 
the hollows and up winding dirt roads. What will happen to these 
beneficiaries?
    Answer. These beneficiaries first should contact their physicians 
to determine whether, in the physician's medical judgement, they 
qualify for home health based on the need for another skilled nursing 
service besides venipuncture. The physician is responsible for 
assessing whether a patient requires Medicare home health care, and for 
establishing a patient's plan of care. The Health Care Financing 
Administration (HCFA) has stated that most beneficiaries will not be 
affected by the venipuncture provision because they require another 
skilled nursing service or physical or speech therapy.
    However, if the physician determines that a beneficiary no longer 
qualifies for Medicare home health, there are several other ways the 
beneficiary can receive blood tests. Home health agencies can take a 
blood sample at a beneficiary's residence and bill Medicare for the 
service using the appropriate codes for specimen collection and travel. 
Furthermore, agencies may conduct some of the less complex blood tests 
themselves, receive the collection and travel fee, plus receive a fee 
for performing the tests. These are called the Clinical Laboratory 
Improvement Amendments (CLIA)-waived tests. The CLIA-waived tests 
include among others, glucose (tests blood sugar levels for diabetic 
patients), and cholesterol/triglyceride (checks lipid levels, used for 
patients with cardiovascular disease).
    In addition to home health agencies performing venipuncture, a 
variety of other providers can take a blood sample at a beneficiary's 
home. The physician prescribing the blood tests can conduct a home 
visit for evaluation and management, and take a blood sample during the 
visit. The physician also can arrange for a nurse practitioner, 
physician assistant, or clinical nurse specialist to conduct a home 
visit and draw blood when they examine the beneficiary.
    Question. Can you tell me how many beneficiaries will be affected 
by the venipuncture provision of the BBA?
    Answer. HCFA does not have estimates on the number of beneficiaries 
affected by the venipuncture provision. Home health agencies report 
only to HCFA that a beneficiary qualifies for home health because s/he 
needs a skilled nursing service. Agencies do not specifically report 
which of the approximately 14 qualifying skilled nursing services the 
beneficiary needs.
    However, HCFA believes that most beneficiaries will continue to 
qualify for home health because they need another skilled nursing 
service, such as observation and assessment, monitoring effects and 
compliance with complex medications changes, wound care, or others. For 
example, severe diabetics generally qualify because they need another 
skilled nursing service besides blood draws. Stroke victims also may 
qualify for home health because they require physical therapy or speech 
language pathology services.
    Question. What assurances can you provide that the alternatives to 
care that HCFA has in place are sufficient to assist rural 
beneficiaries?
    Answer. While we believe that most beneficiaries will have no 
problem having blood samples taken, there may be some areas of the 
country where blood specimens are more difficult to collect. HCFA is 
continuing to study this issue.
    Question. What would be the cost of re-implementing the 
venipuncture benefit or of a grandfathering provision for those who 
received the benefit prior to February 1998?
    Answer. Although no one has estimated the cost of a grandfathering 
provision, the Congressional Budget Office has scored reinstating 
venipuncture as a qualifying skilled service to receive home health. 
Their cost estimates for repealing the venipuncture provision are $1 
billion for fiscal year 1999 to 2003 and $2.5 billion for fiscal year 
1999 to 2008.
                                alcohol
    Question. Madame Secretary, would you please comment on the 
Department of Health and Human Services role in educating the nation 
about youth alcohol use and alcohol abuse?
    Answer. I agree with you that young people, specifically those 
underage, need a clear message that consuming alcohol has serious 
consequences and can result in destructive behavior. As I have traveled 
throughout the country and met with young people, I have been very 
clear the dangers of engaging in a variety of risky behaviors the use 
of drugs, including alcohol; smoking; and sexual activity. In the case 
of our message about the dangers of alcohol, we are still not getting 
through to thousands of older teens. We need to focus much more on 
early detection, timely intervention and comprehensive prevention.
    In a recent major speech I gave to the Annual Meeting of the 
National Collegiate Athletic Association, I called for greater action 
on the part of the universities about the major public health problem 
of alcohol abuse. I asked the schools to begin the process of severing 
the tie between college sports and drinking--completely, absolutely, 
and forever. I asked that schools consider: no alcohol advertising on 
the premises of an athletic event; no bringing alcohol to the site of 
the event; no turning a blind eye to underage drinking at tailgate 
parties and on campus; and no alcohol sponsorship of sporting events. 
Research suggests that advertising may influence adolescents to be more 
favorably disposed to drinking. These voluntary guidelines would remove 
that advertising at intercollegiate sporting events.
    In addition, the Center for Substance Abuse Prevention and the 
National Institute on Alcohol Abuse and Alcoholism (NIAAA) are 
collaborating on a joint Request for Application (RFA) titles ``Effects 
of Alcohol Advertising on Underage Drinking'' in fiscal year 1998. The 
RFA will support five-year grants which conduct complex longitudinal 
research to determine whether alcohol advertising affects both 
initiation and continued consumption among youth. Grants are expected 
to explore short an long term relationships among exposure to alcohol 
advertising, alcohol expectancies and other mediating variables, and 
actual consumption among youth.
    Another element of our education efforts is making available high 
quality materials that are used and accepted by young people, as well 
as adults. The NIAAA distributes brochures, helpful guides, video 
cassettes, and other types of information and materials on substance 
abuse through its National Clearing House for Alcohol and Drug 
Information. An especially popular publication has been Alcohol Alerts, 
covering such topics as ``Alcohol and Tobacco,'' ``Alcohol, Violence 
and Aggression,'' and ``Youth Drinking: Risk Factors and 
Consequences.'' NIAAA also works with the Department of Education's 
Safe and Drug Free School Program--preventing and reducing alcohol use 
among college students and modifying college environments that are 
conducive to alcohol abuse.
       appalachian laboratory for occupational safety and health
    Question. What is the number of Full-Time Equivalents (FTE) for the 
Division of Safety Research and the Division of Respiratory Disease 
Studies at this facility in fiscal year 1998 and the number projected 
for fiscal year 1999?
    Answer. The fiscal year 1998 FTE projection for the Division of 
Safety Research (DSR) is 107 and is projected to be the same in fiscal 
year 1999. For the Division of Respiratory Disease Studies (DRDS), the 
1998 plan is 135 with the same number projected for 1999.
    Question. Please provide the funding level for the above-mentioned 
Divisions in fiscal year 1998, and the projected level for fiscal year 
1999.
    Answer. The current fiscal year 1998 allocation for DSR is $11.891 
million and for DRDS $12.100 million. There are no changes for fiscal 
year 1999.
             new occupational safety and health laboratory
    Question. How many FTE's are at this facility in fiscal year 1998, 
and what is the projected number of FTE's for fiscal year 1999?
    Answer. By September 30, 1998, 280 full time staff are projected to 
be on board at the new laboratory. The full compliment of 303 full time 
staff will be hired by December 31, 1998.
    Question. Please furnish the funding level required for staffing 
and research for fiscal year 1999 at this facility.
    Answer. Our current estimated level of funding for this facility in 
fiscal year 1998 is $33.725 million. We estimate that this same amount 
would be required for staff and research in fiscal year 1999.
    The fiscal year 1998 budget includes the funding for 23 FTE's. 
Strategic planning and targeted recruitment efforts to hire the top 
scientists and technicians in the field, where all recruitment efforts 
are necessary to compete with private industry, have somewhat delayed 
hiring processes. Since the FTE's are not yet on board, the fiscal year 
1998 funding has been used for the one-time purchase of start-up 
equipment and other related costs for laboratories. Once on board, 
FTE's will be supported through the fiscal year 1999 funding as 
planned. No budget increases are being requested for fiscal year 1999.
                                 ______
                                 
                  Health Care Financing Administration
                     Additional Committee Questions
                      cost of gao recommendations
    Question. Ms. DeParle, GAO and the Practice Expense Coalition have 
made a number of recommendations for your agency to further refine 
practice expense data during phase-in of the new fee schedule revision. 
Do you intend to implement these recommendations, and what will this 
cost?
    Answer. We are studying the recommendations but have not made a 
final decision about the process we will use to refine practice expense 
relative values. Consequently, it would be premature to estimate any 
associated costs.
    Question. Can these costs be financed within your agency's fiscal 
year 1999 budget request?
    Answer. We are confident that the agency's fiscal year 1999 budget 
request includes the necessary resources for this process.
                           meeting deadlines
    Question. I understand that the GAO and the physician community 
have raised a number of concerns about HCFA's work to date. In response 
you note that you are considering the suggestions of GAO and you have 
held numerous meetings with physician organizations, although no 
consensus among physicians has been reached. With all of these 
unresolved issues, how can your agency publish a proposed rule on May 
1st that responds to the mandates of the Balanced Budget Act of 1997, 
the recommendations of the GAO, and the concern of the physician 
community?
    Answer. We believe that we will be able to publish a proposed rule 
on May 1, and fully intend to do so. This is not to minimize the task 
ahead of us. Developing a resource-based practice expense methodology 
is a complex undertaking, and with $20 billion of Medicare spending at 
stake, it is a responsibility we take very seriously. As the question 
notes, we will need to balance the mandate of the Balanced Budget Act 
(BBA) of 1997, the recommendations of the General Accounting Office 
(GAO) and the concerns of the medical community, along with our own 
obligation to ensure that our proposal is methodologically sound.
    We were pleased to receive the recommendations from the GAO and 
were gratified by their general support of HCFA's work on practice 
expense to date and by their affirmation that generally accepted 
accounting principles were utilized. Most of the recommendations are 
medium to long range, and do not apply to our May proposed rule. The 
more immediate recommendations are still under consideration and are 
directly addressed, to some degree, by each of our optional 
methodologies. We also believe that whichever methodology we choose to 
propose in May will, to the maximum extent practicable, respond to the 
mandate of the BBA.
    As your question also notes, no consensus has been reached among 
physicians as to the preferred methodology for determining practice 
expense relative values. Given that any change in the current system 
will result in some degree of redistribution, and given that we are 
operating under the constraints of budget neutrality, it is not 
surprising that one specialty's gain would be viewed as another 
specialty's loss. However, from the beginning of the practice expense 
initiative, we have sought maximum input from the medical community and 
have attempted to find ways to address their concerns. We are now 
considering optional methodologies to respond to comments and concerns 
that have been raised.
    Question. If HCFA can't accomplish all that needs to be done by 
May, will you be able to complete your work by January 1, 1999?
    Answer. The rule we will publish in May is a proposed rule, with a 
90-day comment period. The final rule is due to be published by October 
31. We expect a large volume of comments on our proposal and will, as 
appropriate, make the needed changes. This will entail a great deal of 
analytical work on the part of our staff, but we fully anticipate that 
the final rule will be published in time for implementation of the new 
practice expense values to take place on January 1, 1999.
    Question. Dr. Day's prepared testimony suggest that the process for 
collecting physician practice expense information could be facilitated 
by convening a public/private partnership between HCFA and physician 
organizations. What do you think?
    Answer. We certainly do want to work cooperatively with physician 
organizations, now and in the future, in order to develop and then 
improve our practice expense methodology. We agree with the GAO report 
regarding the recommendation of several medical specialty groups that 
HCFA base practice expense values on data obtained from physician 
surveys or on-site data collection. The GAO believes that using such 
approaches as the primary means for developing direct expense estimates 
would needlessly increase costs and further delay implementation of the 
fee schedule revisions. We will, however, explore what additional data 
we will need for future refinements.
                           refinement process
    Question. You state that you are currently developing plans for 
refining the new system, once it's in place. Have you made any final 
decisions about this process? Are the resources necessary for this 
refinement contained in HCFA's fiscal year 1999 budget?
    Answer. We have not yet made any final decisions about the process 
we will use to refine practice expense relative values. To a large 
degree, the specifics of the process will depend on the option we 
finally choose to develop the initial relative value units. In 
addition, this is a topic on which we want to receive more input from 
the medical community, and we are planning to include in our proposed 
rule a specific solicitation of ideas, comments or advice on the 
refinement process. We believe that our fiscal year 1999 budget request 
includes sufficient resources for the refinement process.
                             access to care
    Question. You note that you will continue to monitor indicators of 
beneficiary access to care. I am very concerned that if physicians 
experience the same level of reductions as were proposed by HCFA last 
year, Medicare beneficiaries will experience access problems. How does 
HCFA intend to monitor this potential problem?
    Answer. HCFA has a broad and varied approach to monitoring access 
to care. Much of our effort has focused on assessing the impact of 
specific program changes, such as implementation of the Medicare fee 
schedule (MFS), on access to health care services in the fee-for-
service (FFS) sector. To date, our monitoring efforts have shown that 
implementation of the MFS has not negatively impacted on access. It is 
conceivable, however, that future program changes could negatively 
affect access. For this reason, we will continue to monitor the impact 
of program changes. As part of this ongoing effort, we will continue to 
monitor and report on the rate of referral sensitive surgeries, and the 
rate of hospitalizations for ambulatory care sensitive conditions, such 
as asthma and pneumonia. We will also use survey-based data, such as 
the Medicare Current Beneficiary Survey, to examine beneficiary self-
reports of access problems. In addition, a major set of activities 
involves the development of new indicators for both Medicare and 
Medicaid. Examples include the development of clinically-based 
indicators of appropriate care for beneficiaries with chronic 
conditions, such as diabetes. Our analyses will focus on and highlight 
population subgroups for which there appear to be potential access 
problems.
    Question. Given that many private insurers, as well as other 
government programs are also using the Medicare fee schedule are you 
monitoring access to care for all our citizens?
    Answer. HCFA's current efforts to monitor access are not limited to 
the Medicare population. To illustrate, we are monitoring access for 
the Medicaid population. In particular, HCFA has 6 ongoing contracts to 
evaluate the section 1115 demonstrations. These evaluations examine the 
impacts of moving about 6 million Medicaid beneficiaries into managed 
care and expanding Medicaid eligibility in 12 States, and the District 
of Columbia. In each evaluation, a significant component is concerned 
with Medicaid beneficiaries' access to care. For the Medicaid 
population, we will examine such issues as the availability and use of 
primary care and specialty providers, travel and waiting time, and 
language barriers.
    Similarly, as part of the Children's Health Insurance Program, 
States are required to describe in their State Plan the methods that 
will be used, including monitoring, to ensure access to covered 
services. Following review and approval of the State Plan, States will 
be required to report to HCFA on an ongoing basis on their monitoring 
efforts and performance in the area of assuring access to covered 
services.
    Finally, attempting to monitor access throughout the entire health 
care industry demands comprehensive data sources. These issues are best 
addressed through national surveys of the entire population, such as 
those conducted by the Agency for Health Care Policy and Research 
(AHCPR). HCFA staff are actively working with private interests and 
other government agencies to establish additional standardized 
reporting efforts, such as Health Plan Employer Data Information Sets 
(HEDIS) and the Consumer Assessment of Health Plan Survey (CAHPS), 
which will give us new tools and different perspectives on access to 
care issues.
                            equipment costs
    Question. Many physician groups, according to GAO, state that 
HCFA's estimates greatly overstate the utilization of most equipment, 
which results in underestimating equipment expenses. Does HCFA plan to 
test the effects of different utilization rates on various specialties?
    Answer. HCFA does plan to perform sensitivity analyses to test the 
effects of varying equipment utilization rates on the different 
specialties. It should be noted that in our notice of pre-rulemaking, 
published in the Federal Register on October 31, 1997, we requested 
data on actual utilization rates. Unfortunately, we received only a few 
comments on equipment utilization with information on only a few 
specific pieces of equipment. We will welcome any additional data that 
the medical community wishes to share with us.
                         work done in hospitals
    Question. In last June's proposed regulations, your agency 
eliminated nearly all expenses associated with physician's staff, 
primary nurses, for work they do in hospitals. The rationale was that 
it is Medicare's policy to pay hospitals, rather than physicians, for 
these expenses.
    What evidence is there that this policy results in a major 
absorption of costs for surgical specialists?
    Answer. In comments and in our panels, many surgical specialty 
groups have complained about the elimination of most of the claimed 
expenses connected with work done by physicians' clinical staff in the 
hospital. In the same panels, many other physicians disputed the 
surgeons' claims that staff was typically brought into the hospital. 
The American Hospital Association conducted a survey of its members 
which indicated that, in the vast majority of hospitals, surgeons did 
not use their own staff with hospital patients. In addition, in the 
October 1997 notice of pre-rulemaking, we specifically requested 
information on this, asking commenters to send us the name of any 
hospital where this practice occurred. We did not receive the name of 
any hospital. However, we still continue to hear from surgical 
specialty societies that use of physicians' staff in the hospital is 
increasing. This may well be true, but we are not currently in receipt 
of hard evidence that indicates that our policy would result at this 
time in a major absorption of costs for surgical specialists. We will 
continue to collect as much data as we can on this for future 
refinement.
    Question. Ms. DeParle, will this matter be corrected in the May 
1998 regulations, or left for adjustments during the refinement 
process?
    Answer. We have not yet made a final decision on our treatment of 
physicians staff used in the hospital. In part, it will depend on which 
alternative methodology we choose. Each of our suggested options treats 
clinical staff costs in a different manner.
                            medicare+choice
    Question. Madame Secretary, you are requesting the full 
authorization level of $150 million for fiscal 1999 to administer the 
``Medicare+Choice'' program enacted last year; this program greatly 
expands the options available to beneficiaries among fee-for-service 
and managed care plans. Why do you need an increase of this magnitude 
over the $95 million provided by Congress for the current fiscal year?
    Answer. The 1998 user fee money is being used mostly for start-up 
costs and building infrastructure, whereas the 1999 user fee money will 
be used to actually operationalize the new Medicare+Choice program.
    It is essential that HCFA receive the full $150 million 
authorization in fiscal year 1999. We expect most new plans will not be 
approved until after the fiscal year begins, which in turn will lead to 
an explosion of beneficiary inquires regarding their new plan choices.
    The $150 million in user fees we request for fiscal year 1999 will 
be used to distribute revised information on Medicare+Choice plans that 
are approved after the initial comparative handbook has been published. 
This updated information will be distributed via mail, libraries, and 
the Internet. In addition, the money will be used to staff the expected 
increase in calls to the new toll-free hotline, conduct health fairs 
and other dissemination activities across the country, and to continue 
our marketing research on how best to get information to our diverse 
beneficiary population.
    Question. Health plans invest considerable resources in becoming 
Medicare HMO's. It is not unusual for a plan to spend $100,000 to 
$150,000 just to prepare and submit an application to become a Medicare 
risk HMO. Today, 322 health plans participate in the Medicare HMO 
market. Assessing $37 million in new user fees for initial applications 
and contract renewals represents an additional assessment of almost 
$115,000 on each of these plans. Wouldn't this user fee represent a 
significant barrier to entry for new organizations such as PSO's?
    Answer. We estimate the cost per plan is much less than you state--
for the processing of initial applications about $55,000 and 
approximately $41,000 per plan to renew and monitor existing plans. We 
do not feel that this will represent a significant barrier to entry for 
PSO's or any of the new Medicare+Choice plans. The proposed fee is to 
cover the costs of the Federal government associated with 
Medicare+Choice plans acquiring a Medicare contract; there is currently 
no charge for this benefit. These plans will directly benefit from the 
Medicare program and it is reasonable to expect them to pay the costs 
of doing business in the program.
    Question. Wouldn't this user fee strain the resources of health 
plans that have already reduced some of their additional benefits for 
seniors in response to the new payment methodology under the Balanced 
Budget Act of 1997?
    Answer. We believe that this user fee will not place too much of a 
burden on health plans. As beneficiaries options increase, competition 
amongst Medicare+Choice plans will continue to increase. The type of 
benefit package that plans offer will be used as a marketing tool. 
Plans will have a strong incentive to provide better benefit packages 
and a higher level of service to attract and retain Medicare 
beneficiaries.
    Due to the enactment of the BBA, we believe that the number of 
Medicare beneficiaries enrolled in Medicare+Choice plans will increase 
at a pace faster than would have occurred under the old 1876 
provisions. This will create a much larger market for these types of 
health plans. We feel that the overall impact on plan revenue will not 
have an adverse effect on the quality of services or benefit packages 
that plans provide.
    Question. Please describe the status of HCFA's beneficiary 
education and information campaign. Under the Balanced Budget Act of 
1997, a number of new health care delivery options become available to 
seniors in January 1999. Is HCFA's education campaign on schedule for 
informing beneficiaries regarding these options in a timely manner?
    Answer. Yes, HCFA is on schedule with the various initiatives 
included under the Medicare+Choice beneficiary education and 
information campaign. HCFA's new consumer information Internet site, 
``www.medicare.gov,'' went live in March 1998. This web site includes 
``Medicare Compare,'' the interactive database with the HMO comparison 
chart on benefits, premiums, and cost-sharing.
    We plan to have the majority of our implementation activities for 
the toll-free call center completed during fiscal year 1998, so the 
center can be fully operational in fiscal year 1999. This activity is 
very extensive and will require a lot of effort from HCFA and the 
private sector contractor which will operate the center. The call 
center will receive a lot of calls and it is crucial that 
representatives have adequate training to handle the different types of 
questions that Medicare beneficiaries will have.
    Publishing and mailing the Medicare+Choice comparative information 
is on schedule for a fall mailing. Compiling this type of information 
for the first time and having the information for specific areas is an 
important and complicated task. HCFA and a contractor will continue to 
explore effective and efficient dissemination strategies.
    HCFA has developed a plan for a national publicity and educational 
campaign to inform beneficiaries of their health plan options that will 
combine and coordinate the efforts of HCFA, including its regional 
offices, its partners and contractors, and community-based 
organizations throughout the country. The primary attributes of HCFA's 
campaign are: that it be interactive, i.e., that it will afford 
beneficiaries the opportunity to ask questions and/or obtain 
counseling; that it be conducted at local outlets that beneficiaries 
can access; and that it take place at the optimal time period of 
beneficiary information needs.
    This plan will incorporate and build upon existing locally-based 
interactive activities currently sponsored by these organizations 
either individually or in cooperation with others. Further, HCFA 
intends to work with large employers to assist it in sharing 
information about Medicare+Choice with their retirees. These activities 
may include participation in ``auditorium-type'' benefits fairs, 
presentations to beneficiaries and other interested parties at 
beneficiary gathering places, interactive television shows, radio call-
in shows, strategically placed interactive information kiosks, Internet 
chat and news groups, and newspaper question and answer columns. These 
community based activities will begin with awareness building and will 
take place in late summer and continue through the fall.
    Question. HCFA has indicated that it intends to make the initial 
application process for existing Medicare health plans to convert to 
Medicare+Choice plans fairly simple and ``streamlined.'' At the same 
time, HCFA has requested $37 million in user fees from Medicare+Choice 
organizations for reviewing initial applications and contract renewals. 
Currently, HCFA does not charge an application or contract renewal fee. 
Please describe the initial application and renewal process for health 
plans wishing to become a Medicare+Choice organization and why that 
should necessitate $37 million in user fees.
    Answer. The purpose of this fee is to recover the costs incurred by 
HCFA to allow a managed care plan to obtain a Medicare contract and 
thus become a Medicare+Choice organization. Because these plans will 
benefit from this program, it is reasonable to expect them to pay the 
costs of doing business in the program.
    The costs associated with processing managed care plan 
applications, the annual renewal of contracts, and the monitoring of 
managed care plans, currently come out of HCFA's administrative budget. 
HCFA staff visit the organization to conduct a legal review of the 
entity and its administration. This includes monitoring for fiscal 
soundness and all other requirements that the plan must meet to 
participate in Medicare. We also conduct an in-depth review of the 
plan's health services delivery network, marketing materials, benefit 
packages, and enrollment and disenrollment procedures.
    The rate of growth in the number of managed care plans has averaged 
almost 23 percent in recent years, and the number of plans we contract 
with will increase significantly with the implementation of the 
Medicare+Choice program. Obtaining the resources necessary to deal with 
this increasing workload from a user fee to be paid by those 
organizations that benefit directly from HCFA's activities, seems both 
prudent and reasonable. The proposed fee is to cover the costs 
associated with Medicare+Choice plans acquiring a Medicare contract for 
which there is currently no charge.
    Question. Although HCFA currently conducts numerous beneficiary 
education and information dissemination activities, it has not 
elaborated on its plans to use its existing infrastructure in meeting 
the Balanced Budget Act requirements for a beneficiary education and 
information campaign. Will HCFA use some [of] its existing toll-free 
lines to offset the costs of its beneficiary education and information 
campaign?
    Answer. HCFA is exploring the most customer-centered, cost-
effective solution to this effort. As part of the legislation, the 
Secretary must make available a toll-free number for inquiries on 
Medicare+Choice options. In this light, HCFA is developing a plan to 
deploy a single 1-800 number service to meet the Medicare+Choice 
information needs of Medicare beneficiaries. The Medicare+Choice toll-
free line will be used as part of, and as a supplement to, the 
beneficiary education and information campaign, and will address many 
questions related to Medicare+Choice. Current toll-free lines are 
designated to address issues related to claims processing and payment, 
quality of care, and beneficiary protections and insurance counseling 
and assistance. Information about Medicare+Choice will also be made 
available through these 1-800 services.
    HCFA is also building an alliance network to enlist the aid of 
national, State, and local organizations in the public and private 
sectors. These organizations will be asked to serve as intermediaries--
channels of transmission for program activities, messages, and 
materials in an awareness campaign and a large-scale national education 
effort. One objective of the alliance network is to leverage the 
existing expertise in the existing community based networks to lay the 
foundation of sustained support for a broad base of public, private, 
and volunteer community-level support. In addition to working with the 
States, advocacy groups, such as AARP, and some provider organizations, 
we are actively seeking employers to help share information about 
Medicare+Choice with their retirees--groups that share a common 
interest in informing and educating Medicare beneficiaries.
    HCFA has embarked on a team approach, using our existing 
information intermediaries to ensure that beneficiaries will have 
access to a readily-available network that is capable of providing 
Medicare+Choice information through existing phone networks, printed 
material, educational fairs, and other outreach activities. This 
network includes: Medicare carriers, Health Insurance Counseling and 
Assistance program (HICAP) staff, peer review organizations, and other 
agents and partners. All of these sources of information dissemination 
will leverage community resources to foster the Medicare+Choice 
campaign.
    Question. Has HCFA explored the capacity of some of its sister 
agencies that work with Medicare beneficiaries, such as Social Security 
Administration, in conducting education activities?
    Answer. HCFA is building an alliance network to enlist the aid of 
national, State, and local organizations in the public and private 
sectors. These organizations will be asked to serve as intermediaries--
channels of transmission for program activities, messages and 
materials--in an awareness campaign and a large-scale national 
education effort. As part of this alliance network, HCFA will work with 
its sister agencies such as the Social Security Administration, the 
Administration on Aging, the Office of Personnel Management the Agency 
on Health Care Policy and Research, as well as other parts of the 
Public Health Service.
    Question. Does HCFA plan to work with State area Aging 
Organizations and other senior organizations as part of its beneficiary 
education and information campaign? The Balanced Budget Act of 1997 
introduced a number of new health care delivery system options for 
seniors. How will HCFA educate State and senior organizations regarding 
these new options?
    Answer. HCFA is building an alliance network to enlist the aid of 
national, State, and local organizations in the public and private 
sectors. These organizations will be asked to serve as intermediaries--
channels of transmission for program activities, messages and 
materials--in an awareness campaign and a large-scale national 
education effort. One objective of the alliance network is to leverage 
the existing expertise in the community, as well as the existing 
community-based networks to lay the foundation of sustained support for 
a broad base of public, private and volunteer community-level support.
    As part of this network, HCFA will work with these organizations 
and many others as part of its campaign. In addition to working with 
the States, advocacy groups (such as AARP) and some provider 
organizations, we are actively seeking employers to help share 
information about Medicare+Choice with their retirees--groups that 
share a common interest in informing and educating Medicare 
beneficiaries.
    Extensive training of these organizations will be necessary to put 
these groups in a position to address beneficiary concerns. We plan to 
structure our overall campaign so it can be accessed by a variety of 
people, from a variety of sources, in a manner that will ensure 
reliable and accurate information is provided to beneficiaries.
    Question. Several health plans that operate toll-free lines to 
field pre- and post-enrollment questions reported a $5.50 or less per 
call estimate including phone calls, training, staffing and other 
overhead. How does this estimate compare with HCFA's per call estimate 
for its proposed toll-free call centers?
    Answer. There are many factors involved that will impact the cost 
per call of the Medicare+Choice Toll-Free Line, including: The length 
of time on the call; the degree of complexity of the incoming 
questions; and the cost premium associated with employing a highly 
skilled temporary workforce.
    The Medicare+Choice Toll-Free Line is being designed to provide 
specific information on approximately 500 different managed care plans, 
as well as information on Medicare+Choice in general, to a population 
base of approximately 39 million beneficiaries; therefore, the cost per 
call could exceed many individual health plan call center cost 
estimates. We are working closely with call center industry staff and 
our contractor, Arthur Andersen, to establish accurate costs associated 
with this initiative. We are currently conducting a procurement for the 
work, and will distribute the information to you once the procurement 
is completed.
    Question. You are requesting level funding of $10 million for 
fiscal year 1999 for the Health Insurance Counseling and Assistance 
Program, which is planned to be a part of the Medicare+Choice 
beneficiary information plan and which provides individualized 
counseling to Medicare beneficiaries mostly through a network of 
trained volunteers. In light of the high probability that the ICA 
program counselors will face substantial additional demands for 
individual counseling, do you believe this funding will be adequate in 
fiscal 1999?
    Answer. HCFA currently provides $10 million as the basic level of 
effort for beneficiary health insurance counseling and assistance 
services. This volunteer-based program provides a cost-effective and 
essential tool in the educating and counseling of beneficiaries in 
vital areas such as health plan choices, fraud and abuse prevention, 
basic Medicare coverage, and Medigap insurance.
    Due to enactment of the Medicare+Choice provisions of the Balanced 
Budget Act, HCFA will require additional resources to inform and 
educate beneficiaries about their available Medicare+Choice options. To 
meet this need in fiscal year 1998 and fiscal year 1999, HCFA will 
allocate an additional $5 million towards this effort. We expect that 
this need will continue and that the counseling role of our State 
partners will significantly increase. As awareness and interest in 
Medicare+Choice options increase, we anticipate that greater numbers of 
beneficiaries will depend on our State partners to assist them in 
making appropriate health plan choices.
                               user fees
    Question. Congress has already enacted legislation authorizing up 
to $150 million in user fees for implementing the ``Medicare+Choice'' 
program in fiscal 1999, and you are requesting the full amount. You are 
also requesting $265 million in new user fees to help finance an 
expansion of Program Management activities. Further, you are requesting 
legislation to collect an additional $395 million in user fees to 
augment audit activities. That's $810 million in user fees to be 
imposed in fiscal year 1999, more than 8 times the current level. What 
reaction are you getting from health care providers which would bear 
the brunt of these extra costs?
    Answer. We believe that charging these fees is reasonable and will 
not impose a burden on providers in light of the benefits they receive 
for affiliation/participation in the program. These fees will allow us 
to oversee the Medicare program, including the significant recent 
legislative changes, while minimizing the need for discretionary budget 
authority. The additional resources provided via these fees will also 
allow HCFA to greatly increase its fraud and abuse activities.
    Question. Your budget request for Program Management of the Health 
Care Financing Administration assumes enactment of user fee legislation 
totaling $264.5 million. Without these proposed user fees your 
``current law'' appropriation request is actually a cut of $65,066,000 
below a freeze level. What would be the impact of a $65,066,000 cut?
    Answer. A $65.1 million cut in HCFA's baseline funding is 
unrealistic. Not only would many aspects of the HIPAA and the BBA not 
be implemented, but the agency's existing workloads--including 
mandatory requirements such as annual surveys of nursing homes--would 
be seriously impacted. These fees are meant to fund some of the 
agency's existing workloads, thus freeing up resources to be used to 
support implementation of the HIPAA and the BBA.
    Question. If the authorizing Committee does not enact your user fee 
legislation, what alternative would you propose?
    Answer. If the authorizing committee does not enact our user fee 
legislation, HCFA will be unable to accomplish critical workloads. 
During my appearance before the House Appropriations Subcommittee on 
March 4, Chairman Porter suggested that he would consider inclusion of 
user fee language in the appropriations bill in the absence of another 
bill to which these proposals could be added.
    Given the constrained discretionary budget environment we believed 
that funding the agency's required program level from user fees, 
charged to those individuals and organizations that benefit directly 
from HCFA's activities, is both reasonable and prudent.
                        cost of new legislation
    Question. According to your budget justification materials, you are 
requesting $30.5 million to cover costs of implementing new 
requirements under the Balanced Budget Act of 1997, and $15.5 million 
to implement recently enacted provisions of the Health Insurance 
Portability and Accountability Act. Why didn't you request user fees to 
cover this $46 million costs, instead of $264.5 million?
    Answer. It was not our intent that the proposed user fees cover 
only the incremental need for implementation of the HIPAA and the BBA. 
Given the current constraints on discretionary budget authority, our 
goal was to have those individuals and organizations that benefit 
directly from the Medicare program pay the costs associated with the 
activities HCFA undertakes on their behalf. This, along with the 
requested appropriation level, will enable the agency to fund not only 
existing workloads, but new workloads associated with the HIPAA and the 
BBA, while minimizing the level of appropriated discretionary budget 
authority.
                              path audits
    Question. Last fall, I held a special hearing on the conduct of the 
Inspector General's PATH audit program (Physicians at Teaching 
Hospitals). In addition to representatives of the Office of Inspector 
General and the Health Care Financing Administration, I heard testimony 
from the Association of American Medical Colleges. How does HCFA intend 
to address the complaints from the teaching hospitals that they are 
being treated unfairly by overzealous auditors?
    Answer. I have been assured by OIG that its auditors are aware of 
the importance of treating teaching hospitals fairly and physicians 
respectfully. The OIG has said that the PATH audits are both 
appropriate and fair. The OIG provides teaching hospitals with ample 
opportunity to respond to auditors' findings and to furnish additional 
documentation and information on any aspect of a PATH audit at any time 
during the process. Nonetheless, if a hospital believes that it is not 
being treated fairly, it should make its concerns known.
    Question. Do you believe there is a serious enough problem with 
hospital double-billing and overcharging Medicare to warrant 
nationwide, comprehensive audits?
    Answer. Because the OIG has limited the PATH audits to locations 
where carriers, before December 30, 1992, issued clear explanations of 
the rules regarding reimbursement for the services of teaching 
physicians, the audits are limited in both scope and time. The OIG 
believes, however, that there is a serious enough problem to warrant 
targeted, comprehensive audits, and has the authority to pursue those 
audits under the Inspector General Act.
    Question. What is your assessment of the allegations that the 
Inspector General's office is applying vague regulations retroactively?
    Answer. The policy of the HHS Inspector General is to conduct PATH 
audits only where the Medicare contractor has provided long-standing 
(pre-Dec. 1992) unambiguous guidance to providers requiring the 
physical presence of the teaching physician.
    Question. How much has been recovered to date from the PATH 
initiative?
    Answer. To date, the government has recovered $67.6 million from 
the PATH initiative.
                              gag clauses
    Question. In November of 1996, as the result of a hearing I held on 
quality of care issues under Medicare, the Health Care Financing 
Administration issued a directive specifically banning ``Gag'' clauses 
in all of its managed care contracts. Early in 1997, this ban was 
extended to Medicaid. However there is still no ban on efforts to 
restrict physician communication with patients about treatment options 
in the private health care sector. Do you support legislation to 
prohibit gag clauses in all health plans?
    Answer. Yes, we do support legislation that would prohibit gag 
clauses in all health plans. The President's proposed ``Consumer Bill 
of Rights'' prohibits gag clauses in the administration and management 
of all Federal health programs. The Administration is strongly 
committed to ensuring that all Americans enjoy the protections outlined 
in the Bill of Rights. We would like to see legislation that transforms 
the Bill of Rights into real protections for all Americans.
    Question. In a report issued by GAO in August 1997, about two-
thirds of health plans were found to have had nondisparagement, 
nonsoliciation, or confidentiality clauses that providers might 
interpret as limiting communications about treatment options. How 
serious a threat are such contract provisions to restricting doctor-
patient communications?
    Answer. HCFA's Operations Policy Letter (OPL) 96.044 addresses this 
issue. This OPL basically states that Medicare beneficiaries enrolled 
in Medicare contracting risk plans are entitled to the same benefits 
that they would be entitled to under the fee-for-service program. Among 
the benefits to which the fee for service beneficiaries are entitled is 
the advice and counsel from their physician on medically necessary 
treatment options that may be appropriate for their condition or 
disease. Beneficiaries enrolled in managed care plans are entitled to 
the same advice and counsel.
    The OPL continues to state that a physician providing care to a 
Medicare beneficiary who is enrolled in a Medicare contracting managed 
care plan may not be limited in counseling or advising the beneficiary 
on medically necessary treatment options that may be appropriate for 
the individual's condition or disease. The OPL then states that any 
contractual provisions that limit a physician's ability to do so are a 
violation of the law.
    Whether the clauses that GAO discovered truly limit the 
communications about treatment options would depend upon the wording of 
the clauses and the interpretation placed on them. HCFA's routine 
oversight procedures investigate the content of provider contracts to 
ensure the availability of the medical advice and counseling benefit to 
the contracting managed care members. Any contract wording that is 
thought to limit this benefit is to be removed from the contract.
                               capitation
    Question. Secretary Shalala, I have had many health care providers 
tell me about major excesses and abuses under the payment system of 
capitation. The central focus of a health care system ought to be the 
doctor-patient relationship, but too often under managed care 
capitation, I have heard that the plan administration gets in the way 
and technicians interfere with medical decision making. What needs to 
be done to control the most serious abuses of managed care capitation, 
such as restricting communication on treatment options, referrals to 
specialists, emergency care, and appeal rights?
    Answer. These are very valid concerns regarding managed care versus 
the health care provider-patient relationship. One of the significant 
contributions to managed care of the BBA of 1997 is that for the first 
time, provider protections are addressed at the Federal level. 
Currently, most States have some form of protection in their laws 
governing managed care for the provider-patient relationship but none 
are as inclusive as the BBA of 1997. What has been done to address your 
concerns has been legislation, monitoring, and satisfaction surveys. 
Let me speak to each of these points:
    Section 4001 of the BBA 97 ``Establishment of Medicare+Choice 
Program'' addresses provider protections.
  --Anti-gag clauses are included so providers will not be restricted 
        from discussing treatment options with their patients.
  --Anti-discrimination of providers is addressed so providers treating 
        high-risk, high-cost beneficiaries will not be penalized or 
        prevented from participating in the plan.
  --Prior plan approval for emergency services defined as emergent from 
        a prudent layperson perspective is strictly prohibited.
  --Patients and health care providers have appeal rights for adverse 
        decisions made by the plan.
  --Providers must be consulted in regards to medical treatment 
        decisions and guidelines enforced by the plan.
  --Access to a full range of health services is not only included in 
        the BBA of 1997, but President Clinton's Consumer Bill of 
        Rights.
    Another significant difference in the BBA legislation is that HCFA 
is given a stronger monitoring role. Monitoring of these and other 
requirements will be done more frequently and more uniformly than in 
the past. Part of the monitoring process is interviewing providers who 
contract with a managed care plan. This is one of the most direct 
methods we have of ensuring these protections are adhered to. Another 
part of our monitoring process is a new set of monitoring standards 
much like standards set by accrediting organizations such as the Joint 
Commission on Accreditation of Health care Organizations. These Quality 
Improvement System for Managed Care (QISMC) standards will be monitored 
annually and include provider protection monitoring.
    We have in the past and will continue to conduct provider 
satisfaction surveys of Medicare HMO's, as well as consumer 
satisfaction surveys. The results of these surveys will be used for 
public education on plan comparisons and will certainly have a positive 
influence on relationships between plans and providers which then 
hopefully influences provider-patient relationships. All Medicare-
approved plans will have to conduct consumer satisfaction surveys.
    Question. To what extent should Congress get involved in micro-
managing managed care?
    Answer. We don't believe that (nor have we proposed) any laws 
should be passed that involve micro-managing any form of health care. 
The Consumer Bill of Rights, which the President has endorsed, would 
establish consistent consumer protections for all Americans, regardless 
of where they receive their care or who pays for it. The rights that 
would be established involve ensuring appropriate access to 
specialists, ensuring access to emergency services should the need 
arise, and ensuring full information disclosure for consumers, among 
other important rights. We believe that these rights strike an 
appropriate balance between the health of patients and the ability of 
health care providers and insurers to treat patients in an efficient 
and appropriate manner.
                    medicare customer service pilots
    Question. You are requesting $12.8 million for a Medicare customer 
service pilot program, which includes establishing toll-free telephone 
centers. How many customer service pilots do you intend to implement, 
and what will be the cost beyond fiscal year 1999?
    Answer. We currently fund over 150 different toll-free telephone 
lines at our various agents and partners. This has resulted in a 
patchwork of telephone service which has contributed to a significant 
amount of confusion within the beneficiary community about exactly whom 
to call for Medicare help and assistance.
    At the present time, we are conducting a limited one State 
(Maryland) pilot test referred to as the Medicare Customer Service 
Center (MCSC). Through the establishment of systems interfaces with all 
the multiple information systems containing data about a given 
beneficiary and their use of Medicare, we are testing the feasibility 
and implications of offering a single point of contact for Medicare. 
Our fiscal year 1999 request envisions expanding the geographic area 
covered by the MCSC's so that by the end of fiscal year 1999 it will be 
able to cover approximately half of the Medicare beneficiary 
population. The costs included in our request include the necessary 
hardware and software to support this expansion of the MCSC Pilot.
    Beyond fiscal year 1999, additional funds will be needed to 
purchase the hardware and software to cover the rest of the Medicare 
population, excluding any funding to cover additional requirements 
related to Medicare+Choice customer service requirements.
    Question. Why couldn't you use the existing Social Security 
Administration teleservice center?
    Answer. While we appreciate the marketing advantages of trading on 
a well established and widely known 1-800 telephone number, our 
experience has been that the missions and programs of the Social 
Security Administration (SSA) and HCFA are too diverse to benefit from 
a shared support arrangement, such as a common call center. Indeed, 
SSA's independence from the Department of Health and Human Services on 
March 31, 1995 evidences this diversity. Experience has indicated that 
the technical complexity of both agencies' programs, when combined, is 
well beyond the commonly accepted expectations and capacity of an 
average customer or teleservice center representative. Further, a 
separate and distinct systems infrastructure would have to be built at 
the SSA teleservice center to support the Medicare workload, offsetting 
any of the benefits gained from collocation.
    In that our existing toll-free lines are currently operated by our 
contracted agents and partners, we had envisioned continuing to 
contract for our telephone customer service activities. If we were to 
expand the SSA teleservice centers, we would be forced to request 
between 1,500 to 2,000 additional FTE's to handle the more than 17 
million calls our agents currently receive annually, as well one-time 
funding to pay the contract termination and severance costs incurred by 
our current contractors.
                  attendant care demonstration project
    Question. Madame Secretary, the Conference Report on the fiscal 
year 1998 appropriations bill earmarked $2 million for Medicaid 
attended care demonstrations. I see no mention of this matter in your 
fiscal year 1999 budget justification material. What is the status of 
conducting attendant care demonstration projects for persons with 
disabilities as an alternative to institutional care?
    Answer. During testimony on the MiCASA bill on March 12, we 
announced that we will soon be asking States to submit proposals to 
develop research designs for projects that would identify individuals 
who could successfully move out of nursing homes into the community and 
provide the services needed to support these individuals in the 
community. This solicitation is in response to the commitment made by 
President Clinton on this issue and to the report language accompanying 
the fiscal year 1998 Labor-HHS-Education appropriations bill. We 
believe that we will be able to fund research in 3 to 5 States. If 
further funding for discretionary activities is needed in fiscal year 
1999, we would expect to look to our general research request in the 
fiscal year 1999 President's Budget as a source for these funds.
                      children's health insurance
    Question. The State Children's Health Insurance Program (S-CHIP) 
was established in the Balanced Budget Act of 1997 as a State-federal 
partnership with $4.295 billion in federal funds authorized in fiscal 
year 1998 to provide health insurance for children not covered by 
Medicaid, but whose families cannot afford private insurance.
    A number of uninsured children now receive health care through 
community health centers, community mental health centers, or through 
the Maternal and Child Block Grant. The fiscal 1999 budget requests 
$841 million for community health centers (one-third of health centers 
revenue) and $683 million for the Maternal and Child Health Block 
grant. What impacts will S-CHIP have on funding and target populations 
served by these programs?
    Answer. The State Children's Health Insurance program (S-CHIP) 
represents a tremendous advance in serving the health care needs of 
underserved children. In 1996, 43 percent of the roughly 10 million 
patients seen by Health Centers and the National Health Service Corp 
(NHSC) providers were children, of whom, moreover, approximately 30 
percent--or 1.3 million--were uninsured. We estimate that fiscal year 
1999 sources of funding for Health Centers will include $29 million 
through S-CHIP. This is still a very rough estimate, however; the 
extent and nature of S-CHIP's impact on Health Centers will depend in 
large part upon decisions taken by the individual States and the Health 
Centers themselves. Most States have not yet submitted--or even 
finalized--their S-CHIP plans. Ongoing and intensified outreach and 
educational efforts, in particular, will be necessary to assure that 
all the children who are eligible under S-CHIP are enrolled. More than 
3 million of the over 10 million uninsured children prior to S-CHIP's 
passage were eligible for, but not enrolled in Medicaid. This was, and 
remains, largely due to enrollment barriers or lack of awareness.
    S-CHIP will impact the health insurance coverage of low-income 
children in the U.S. but is not likely to have a substantial impact on 
the mission of the Title V program, the Maternal and Child Health (MCH) 
Block grant. The MCH Block Grant is at its core a public health program 
that reaches across economic lines to improve the health of allwomen 
and children. Within broad State discretion, State Title V programs use 
appropriated, formula grant funds for resource development, capacity 
and systems building, and population-based functions such as public 
information and education, knowledge development, outreach and program 
linkage, technical assistance to communities and agencies, provider 
training, evaluation, implementation of model programs, support for 
newborn screening, lead poisoning and injury prevention, and promotion 
of health and safety in child care settings. Special efforts are made 
to build community capacity to deliver such enabling services as care 
coordination, transportation, home visiting, and nutrition counseling 
and where no services are available, States also use Title V funds to 
subsidize or provide direct care.
    The S-CHIP program, as well as the Medicaid program, is a health 
insurance program that pays for a defined set of benefits for low-
income women and children who are in families meeting specific 
eligibility requirements. These programs, being payers rather than 
providers of services, rely on the public and private sectors to 
organize and provide the services for which they reimburse. 
Historically, State Medicaid programs have relied on State MCH programs 
for assistance in enrolling eligible women and children, developing 
policies, procedures and practice standards that help providers and 
other agencies work more effectively with Medicaid, and organizing and 
providing services not available or accessible in the private sector.
    The OBRA-89 amendments to Title V made clear that Congress did not 
intend to use these public health dollars to pay for direct services 
already covered by Medicaid or private insurers. Similarly, the S-CHIP 
funds available for Title V-type activities is strictly limited by a 
Congressionally imposed cap. States can only use 10 percent of the 
benefits spending under their S-CHIP for outreach, public health 
initiatives, administrative costs, and direct services. States have 
objected that this Cap is already too restrictive. Therefore, we 
believe that the Title V funds will continue to play an important role 
in protecting the health of the American public. However, S-CHIP may 
relieve some of the financial drain on Title V by insuring a group of 
previously uninsured children thereby allowing the funds to be 
refocused on needed public health capacity and resource building 
activities.
    Question. How will funding and services be coordinated between S-
CHIP and these alternative sources of health care for uninsured 
children?
    Answer. Both the Title V Maternal and Child Health Block Grant and 
Community Health Centers (CHC) coordinate health and related services 
for children in Medicaid and WIC and provide outreach to enroll 
children in these programs. In addition, the MCH Block Grant also 
coordinates these and other related services for children with special 
health care needs. Both programs, working closely with Medicaid and the 
private sector, are already studying ways to expand and, in some cases, 
have already begun to expand of their outreach and coordination 
functions. HRSA has been coordinating with the regional, State, and 
local Title V and CHC programs, Primary Care Associations, as well as 
Federal and regional HCFA offices since the inception of the S-CHIP 
plans in order to assure coordination between programs to increase the 
interaction of these programs at all levels around S-CHIP. HRSA staff 
have also brought into these meetings contacts in disability, welfare, 
education, and WIC programs to further enhance cooperation at all 
levels. State MCH Directors have been meeting with their State Medicaid 
offices and the people responsible for developing the State CHIP 
applications to assure coordination of funds and services.
    Question. Will S-CHIP displace the need for some portions of these 
programs?
    Answer. S-CHIP is going to make a significant difference in the 
health coverage status of low-income children, but it will not displace 
a substantial portion of the services provided through the Title V, MCH 
Services Block Grant Program as well as Community Health Centers. The 
S-CHIP program enables States to fund services for uninsured children 
who are also low-income. The two groups of children left unserved by 
the S-CHIP program and still, therefore, requiring services supported 
through HRSA programs are (1) the partially or poorly insured who may 
have no usual sources of care and who seek publicly funded care on a 
regular basis; and (2) those children with special health needs whose 
insurance is nonexistent or inadequately covers those special needs 
necessary for them to function and learn successfully.
    While S-CHIP is a major advance, building capacity to provide 
medical and enabling services in underserved, low income communities is 
necessary to make the new insurance coverage a reality. Health Centers 
currently reach only one-fourth of the 43 million Americans who are 
identified as medically underserved. The number of Health Center 
patients seen increased from 5 million in 1980 to over 9.5 million in 
1995. More than half of the 2,091 U.S. counties identified in 1996 as 
having primary care access problems, moreover, remain unserved by a 
Health Center or an equivalent provider. In addition, in most States, a 
minority of Title V dollars are spent on services that can be financed 
under Title XXI. Both Federal and State Title V funds are already being 
used to leverage other funds and coordinate and administer State 
activities that further develop a seamless, comprehensive, system of 
care for children through initiatives which include technical 
assistance, resource support, and performance measurement, without 
which State CHIP plans will not be able to achieve their goals. The 
challenge of providing adequate primary health care to the underserved 
is greater than ever.
    Question. Are states being encouraged to include community health 
centers and community mental health centers as potential delivery sites 
in the health networks they establish for S-CHIP enrollees?
    Answer. While States are not required to included Community Health 
Centers and Community Mental Health Centers as potential delivery 
sites, HRSA in response to this historic opportunity, has charged every 
State and Regional Primary Care Association--non-profit membership 
organizations that Health Centers--with the responsibility of working 
with their members to ensure that: HRSA-supported programs in their 
States are effective participants in the design, development, 
implementation and operation of S-CHIP; HRSA-supported programs provide 
high-quality, cost-effective care to low-income and uninsured children; 
and, HRSA-supported programs serve significant numbers of children 
covered by S-CHIP.
    To assist Primary Care Associations (PCA's) in attaining these 
objectives, HRSA has implemented two primary initiatives. The first is 
the Five-State PCA S-CHIP Initiative. HRSA will work with PCA's in the 
five States receiving the largest S-CHIP allotments to assess S-CHIP 
opportunities, to collect and disseminate information and data about 
HRSA-supported programs and their services to children, and to document 
the impact of the S-CHIP design/implementation on HRSA-supported 
programs. Effective strategies for ensuring HRSA-supported program 
participation in S-CHIP will be identified, shared, and, as 
appropriate, replicated in other States. One of the designated PCA's, 
in Texas, was recently selected to coordinate all S-CHIP outreach 
efforts in the State. In fiscal year 1998, HRSA has also implemented a 
$1 million pilot program to expand the capacity to establish out-
stationed Medicaid and S-CHIP eligibility workers in Health Centers.

                          subcommittee recess

    Senator Specter. Thank you. The subcommittee will stand in 
recess to reconvene at 2 p.m., Wednesday, March 18 in room SD-
138. At that time we will hear testimony from Hon. Alexis 
Herman, Secretary of Labor on the 1999 budget request.
    [Whereupon, at 3:30 p.m., Tuesday, March 10, the 
subcommittee was recessed, to reconvene at 2 p.m., Wednesday, 
March 18.]


  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1999

                              ----------                              


                       WEDNESDAY, MARCH 18, 1998

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:08 p.m., in room SD-138, Dirksen 
Senate Office Building, Hon. Arlen Specter (chairman) 
presiding.
    Present: Senators Specter, Faircloth, Bumpers, and Kohl.

                          DEPARTMENT OF LABOR

                        Office of the Secretary

STATEMENT OF HON. ALEXIS HERMAN, SECRETARY OF LABOR

                   opening remarks of senator specter

    Senator Specter. Good afternoon, ladies and gentlemen. We 
will commence the hearing of the Appropriations Subcommittee on 
Labor, Health and Human Services, and Education. Today we have 
the opportunity to hear from the distinguished Secretary of 
Labor, the Honorable Alexis Herman, on the fiscal year 1999 
appropriations requests.
    The Labor Department's budget totals $11.1 billion for 
discretionary programs. This is a net increase of $425 million 
or 4 percent above fiscal year 1998. In addition, the Labor 
Department has responsibility for administering a $3 billion 
multiyear Welfare-to-Work Program, with funding provided under 
the historic balanced budget legislation enacted last year.

                           prepared statement

    Madam Secretary, we have a chart which we have shown to 
Secretary Shalala and others, Secretary Riley, showing a $1.9 
billion gap in funding which is supposed to be accommodated by 
tobacco funds, which so far are tobacco in the sky, pie in the 
sky, we do not know where they are coming from, and 
unauthorized user fees. So that is a matter of real concern.
    Without objection, my full statement will be made a part of 
the record.
    [The statement follows:]

              Prepared Statement of Senator Arlen Specter

    This afternoon, the Subcommittee on Labor, Health and Human 
Services and Education will hear testimony from Secretary of 
Labor Alexis Herman on the fiscal year 1999 appropriations 
requests.
    The Labor Department's budget totals $11.1 billion for 
discretionary programs. This is a net increase of $425 million 
or 4 percent above fiscal year 1998. In addition, the Labor 
Department has responsibility for administering a $3 billion 
multi-year Welfare-to-Work program, with funding provided under 
the historic Balanced Budget Act legislation, enacted by 
Congress last year. I have asked the Secretary to pay 
particular attention to the challenges imposed by this major 
new effort, which I intend to closely monitor. In the coming 
months, Madame Secretary, it is my hope that we can work 
together, with the Department of Health and Human Services and 
other agencies with responsibilities for certain welfare reform 
activities, to make sure this program is a resounding success.
    You can see from the chart to my right the difficulty 
facing this Subcommittee by the President's assumption that 
savings will be realized through enactment of user fees or new 
taxes.
    In fiscal year 1997, discretionary spending for this 
subcommittee totaled $74.4 billion.
    In fiscal year 1998, discretionary spending increased to a 
total of $80.4 billion.
    For fiscal year 1999, the President has requested $84.5 
billion, but $1.9 billion of this amount would be financed by 
new user fees and assumed receipts from tobacco legislation.
    Madame Secretary, the Administration's budget request has 
put us in a real spot, basically $1.9 billion in the hole, and 
I fully expect that you will work closely with this Committee 
as we try to resolve this dilemma.
    Madame Secretary, due to scheduling conflicts, we didn't 
have the opportunity to have you appear before the Subcommittee 
last year, although I must say we had occasion to meet in 
Pennsylvania on vital issues, including a conference on women 
in nontraditional occupations, and the announcement of job 
training support for the re-opening of the Philadelphia ship 
yard. I know we can continue to count on your cooperation and 
you can count on ours, in the year ahead.
    Madam Secretary we will be pleased to hear your opening 
remarks at this time.

                summary statement of hon. alexis herman

    Senator Specter. We are pleased to welcome you here, 
Secretary Herman. You are the 23d Secretary of Labor. As 
President Clinton characterized you, quote, she understands the 
needs of workers and understands the challenges they face as we 
approach the 21st century. Welcome, and the floor is yours.
    Secretary Herman. Thank you very, very much, Mr. Chairman. 
I would like to ask that my full statement be submitted for the 
record. If you would permit me to make a few brief opening 
comments before responding to questions.
    Senator Specter. That is entirely acceptable. Without 
objection your entire statement will be made a part of the 
record, and we look forward to your highlighting it.
    Secretary Herman. Thank you very much. I am very pleased to 
be here today to discuss the work of the Labor Department and 
our fiscal year 1999 budget request.
    This is certainly an exciting and historic period for all 
of us who care about improving the lives of America's working 
families. Working together with Congress, we have made enormous 
strides. We have the healthiest economy in a generation. The 
misery rate--the combination of the unemployment rate and the 
inflation rate is at a 31-year low. And just this month the 
Labor Department reported that our economy has created over 15 
million new jobs in the last 5 years. We are entering the 21st 
century truly with opportunity on our side.
    But where there is opportunity, there also is challenge. I 
believe our challenge is to help every American not only secure 
the economic future that they so deserve, but to help them also 
to manage change for the better, to help transform change from 
an obstacle to an opportunity, from something to avoid to 
something to embrace. I see my job today as Labor Secretary as 
making sure that the Labor Department is an effective, 
efficient partner in helping Americans manage change that is 
inherent in today's global economy. As we do that, I want to 
make sure that our initiatives are results oriented and bottom 
line.
    The Department of Labor has made a lot of progress since 
our team came into office 10 months ago. We played a role in 
bringing together labor and management to settle the UPS 
strike. We attacked fraud and abuse in pension and health care 
plans, and recovered more than $360 million for hard working 
Americans.
    We are proud to report the fatality rate for coal mining 
injuries for 1997 was the lowest ever recorded. Similarly, the 
injury and illness rate in general industry for 1996, the 
latest year for which data is available, was the lowest since 
the Bureau of Labor Statistics began collecting the information 
23 years ago.
    Because we know that a paycheck is, in fact, the passport 
to dignity, we have worked diligently to make sure that the 
welfare recipients that we are working with today are 
integrated into the work force development system. As a result, 
we now have $3 billion in grants to distribute to help long-
term welfare recipients secure lasting unsubsidized employment.
    Let me pause here briefly to say that our work force 
development reform is about fundamentally changing how we look 
at the future in a way that is good for workers and good for 
business. We are very hopeful that Senate bill 1186, the 
Workforce Investment Partnership Act, will be considered this 
week and that it will move quickly to conference. Our hope is 
to see a bill enacted before July 1, 1998. Let me say that I am 
pleased with the bipartisan support that this bill has received 
within Congress. As you know, the President has made public 
statements in support of this bill. I hope that you will agree 
with us, Mr. Chairman, that now is the time for action.

                          DOL strategic goals

    But now, in working to establish a unified Department of 
Labor, I have established three strategic goals which bridge 
the Department's many agencies and programs that serve the 
common purpose of helping America's workers meet the challenges 
they face today and in the future.
    The first goal is a prepared work force that enhances 
opportunities for America's workers. With the strategic goal of 
a prepared work force, the Department is committed to creating 
an environment where those new to the labor market or those 
wishing to improve their potential are provided the assistance 
and tools needed to achieve success in today's market, and 
where policy and decisionmakers and those seeking employment 
have access to information for making sound economic decisions.
    Our second strategic goal is a secure work force. We seek 
to promote the economic security of workers and families by 
protecting workers' hours, wages, and other conditions when on 
the job, providing unemployment and compensation benefits when 
workers are unable to work, retraining and adjustment services 
for workers who are permanently laid off from their jobs to 
help them return to work, and expanding, enhancing, and 
protecting workers' pension, health care, and other benefits.
    Our third and final strategic goal is quality work places 
that are safe, healthy, and fair, meaning free of 
discrimination. Since today's workplace is increasingly 
affected by global markets, we will increase our commitment to 
addressing core international labor standards and also child 
labor issues.
    Our fiscal year 1999 budget request of $11.1 billion and 
17,012 full-time equivalent staff is only 4 percent above the 
fiscal year 1998 level. This modest increase in our budget will 
allow us to build on what we are already doing to achieve my 
strategic goals that cut across the Department's agencies to 
serve the common purpose of helping American workers achieve 
economic security and manage change for the better.

                           prepared statement

    Mr. Chairman, I will be happy to discuss today the welfare-
to-work issue that you raised in your letter, as well as any 
other questions from you or members of this committee. I thank 
you for the opportunity to appear before you today.
    [The statement follows:]
                 Prepared Statement of Alexis M. Herman
    Mr. Chairman and distinguished members of the subcommittee: I am 
pleased to be here today to discuss the work of the Labor Department 
and our 1999 fiscal year budget request.
Managing Change in the 21st Century
    We have made great progress in helping America's working families 
build a better future for themselves. The President's budget is a truly 
historic document. It gives the American people the first balanced 
budget in 30 years. Because of tough choices and fiscal discipline, our 
deficit has gone from over $350 billion 5 years ago, to about $10 
billion today, and with this plan it will be zero in the next fiscal 
year.
    And these are also historic times. Thanks to the hard work of the 
American people, we have the healthiest economy in a generation. The 
misery index--the combination of the unemployment rate and the 
inflation rate--is at a 31 year-low. And just this month, the Labor 
Department reported that our economy has created over 15 million new 
jobs in the last five years. We are entering the 21st century with 
opportunity on our side.
    But where there is opportunity, there is also challenge. The 
workplace and the workforce are changing before our eyes. In the 
1950's, the workforce was 20 percent professional, 60 percent unskilled 
and 20 percent skilled. By 1996 it was 20 percent professional, 60 
percent skilled and 20 percent unskilled. Education and training matter 
as never before.
    The workforce of the future is changing in other ways. It will be 
older and more diverse. Our workplace is also changing. We are 
utilizing more technology, and more of us are using that technology. 
The proportion of workers using computers has more than doubled in the 
past ten years alone. And every day we are becoming more globally 
integrated--in the next 10 years up to half of all manufacturing jobs 
will be export-related.
    Our task is to help prepare every American worker for this changing 
world. And our challenge is to help every American manage change for 
the better. I know confronting change is never easy. I've faced a lot 
of change in my life. I've had many different jobs. I've lived in a 
number of cities. I've had a lot of obstacles thrown my way. But I also 
had something else--a solid foundation from which to draw strength--my 
faith, family, values.
    Just as that kind of support structure is integral to managing 
change in our own lives, it is also critical in our national life. 
Because it's that kind of support structure that transforms change from 
an obstacle to avoid to an opportunity to embrace.
    I see my job as making sure the Department of Labor is an 
effective, efficient partner in helping Americans manage the change 
that is inherent in today's global economy. And as we do that, I want 
to make sure our initiatives are bottom-line and results-oriented.
    The Department of Labor has made a lot of progress since our team 
started 8 months ago. We helped play a role in bringing labor and 
management together to settle the UPS Strike.
    We attacked fraud and abuse in pension and health plans and 
recovered over $360 million for hard working Americans.
    We were proud to report that the fatality rate for coal mining 
injuries for 1997 was the lowest ever recorded. Similarly, the injury 
and illness rate in general industry for 1996, the latest year in which 
data are available, were the lowest since the Bureau of Labor 
Statistics started collecting that information 23 years ago.
    And because we know a paycheck is the passport to dignity, we have 
worked diligently to make sure that welfare recipients are integrated 
into the workforce development system. As a result, we now have $3 
billion in grants to help long-term welfare recipients secure lasting, 
unsubsidized employment.
    We want to build on our record and our progress in helping American 
workers manage change for the better. And that's why the President is 
now proposing this year to do things such as raise the minimum wage, 
expand the Family and Medical Leave Act, and work closely with Congress 
to pass legislation to enact his GI Bill for America's Workers that 
will reform the entire job training system so anyone looking for work 
will be able to get the service and assistance they need to find and 
keep good jobs.
    This is all a part of fulfilling the Department of Labor's 
fundamental mission--to assist workers in their efforts to achieve 
economic security, with rising wages, pensions, health benefits and 
opportunities--and to improve their skills in safe and healthful 
workplaces free of discrimination.
    In order to succeed in this mission, the Department has developed 
an effective strategy for improving the lives of America's working 
families. It has been developed within the context of the Government 
Performance and Results Act (GPRA) and is reflected in the Department's 
fiscal year 1999 Annual Performance Plan which is tied directly to our 
budget request. This Performance Plan reflects a substantial revision 
and improvement on the Department's September Strategic Plan which was 
largely developed prior to my arrival. In working to promote a more 
unified Department of Labor, I have established three strategic goals 
which bridge the Department's many agencies and programs that serve the 
common purpose of helping America's workers meet the challenges they 
face today and in the future. Those three strategic goals are: A 
Prepared Workforce--to enhance opportunities for America's workforce; A 
Secure Workforce--to promote the economic security of workers and 
families; and, Quality Workplaces--to foster quality workplaces that 
are safe, healthy and fair.
    With the strategic goal of a Prepared Workforce, the Department is 
committed to creating an environment where those new to the labor 
force, or those wishing to improve their potential, are provided the 
assistance and tools needed to achieve success in today's job market. 
And where policy and decision-makers, and those seeking employment, 
have access to information for making sound economic decisions.
    With the strategic goal of a Secure Workforce, we seek to promote 
the economic security of workers and families by protecting workers' 
hours, wages and other conditions when on the job, providing 
unemployment and compensation benefits when workers are unable to work, 
retraining and adjustment services for workers who are permanently laid 
off from their jobs to help them return to work as quickly as possible, 
and expanding, enhancing, and protecting workers' pension, health care, 
and other benefits.
    With the strategic goal of Quality Workplaces, we will direct 
attention toward fostering workplaces that are safe, healthy, and fair. 
Today's workplace is increasingly affected by global markets so we will 
continue to address core international labor standards and child labor 
issues as they affect American workers. The Department is committed to 
working with employers to help them maintain safe and healthy 
workplaces. However, we will maintain a credible, targeted enforcement 
program to catch and punish the bad actors.
    This vision cannot be accomplished overnight. To accomplish these 
goals, we must make critical investments over a period of years that 
will promote programs to support the President's goals and accomplish 
this vision. Investments that begin with this fiscal year 1999 budget 
will move the Department toward accomplishing these goals for American 
workers, retirees and their families. Investments will continue over 
many years, but this budget request takes the first step on that 
journey.
    Our fiscal year 1999 budget--which amounts to $38.1 billion--will 
allow us to build on what we are already doing and begin new 
initiatives to meet these goals. The amount before the committee 
includes $12.7 billion and 17,012 full-time equivalent (FTE) staff. 
Each of the initiatives in our budget was developed to achieve my 
strategic goals that cross-cut the Department's agencies, programs and 
activities to serve the common purpose of helping American workers 
manage change for the better.
    I would like to discuss my initiatives arrayed by the goal they 
support.
  a prepared workforce--enhance opportunities for america's workforce
    The fiscal year 1999 request includes a continuation of a $250 
million advance appropriation for the Opportunity Areas for Out-of-
School Youth program for Program Year 2000. With your leadership, Mr. 
Chairman, this Sub-Committee provided in the fiscal year 1998 
appropriation, a $250 million advance appropriation for the program for 
use in fiscal year 1999, contingent upon enactment of authorizing 
legislation. The Administration is working closely with Congress to 
enact job training legislation containing this authorization in early 
1998. These resources will be used to provide competitive, matching 
grants to 15 to 20 high poverty urban and rural communities including 
Empowerment Zones and Enterprise Communities, to train an estimated 
50,000 youth for jobs, as an alternative to welfare and crime.
    This is a high priority for me and a challenge that I have devoted 
a good part of my life to addressing. Almost thirty years ago, I worked 
for Catholic Charities in my hometown of Mobile, Alabama. I helped 
young men from the housing projects find apprenticeships and job 
opportunities in the shipyards near Pascagoula, Mississippi.
    There is one statistic that really sticks in my mind from twenty 
years ago when I was working at the Department of Labor. At that time, 
the unemployment rate for African-American teenagers was over 30 
percent. Two decades later, I am back at the Labor Department, and the 
unemployment rate for African-American teens is at 30 percent. This 
Department is about the work of moving a fact like this from the 
statistics books to the history books.
    What is the out-of-school youth initiative all about? Let me tell 
you about Hector Hernandez.
    Hector is from Bellflower, California, one of the barrios of Los 
Angeles. He grew up in one of the toughest neighborhoods in the 
country. His mom was a high school drop-out and survived on welfare. 
His dad--who he hardly ever saw--sold drugs.
    To Hector, school never really seemed important. And so he dropped 
out and joined a gang. One thing led to another, he committed a crime, 
got arrested, and served three years before he was paroled. As a 
condition of his parole, Hector was required to attend the Community 
Youth Corps program in Norwalk, California. This is a Job Training and 
Partnership Act (JTPA) initiative that provides education, training and 
job placement services to out-of-school youth.
    In January of 1997, he began courses for a GED. Hector worked 
hard--and earned his GED last May. Today he works full-time as a 
security guard at a local Nissan plant--and part-time at UPS. Last 
month, he enrolled in Cerritos Community College and hopes one day soon 
to work with youth in the California prison system.
    This story is one of many that demonstrates the kind of success we 
are having by investing in opportunity for our young people. The 
resources that the President's fiscal year 1999 budget contains for 
youth funding will allow us to build on that kind of success, reduce 
unemployment levels for the youth of our country, and make a real 
difference in the lives of young people and the life of our nation.
    The Summer Jobs Program gives hundreds of thousands of urban and 
rural disadvantaged youth their first work experience. The budget 
proposes $871 million which is sufficient to finance as many as 530,000 
job opportunities for the summer of 1999 if local areas use all of 
these resources for summer jobs. The budget also includes $130 million 
for the year-round program to help low-income youth, many of them in 
families on public assistance, who have dropped out of school or are at 
risk of doing so. The proposed budget would continue to permit local 
service delivery areas that receive both types of these funds to shift 
resources between the summer and year-round program, as local needs 
dictate.
    Another of our important programs for youth is the Job Corps, which 
will provide intensive skill training, academic and social education, 
and support to an estimated 69,700 seriously disadvantaged participants 
at 118 centers in fiscal year 1999. An increase of $61.4 million for 
fiscal year 1999, brings the total for the program to $1.3 billion. 
This increase includes funds to complete five new centers and to 
maintain the current program. Funds are also requested to continue the 
multi-year quality improvement initiatives to enhance Job Corps 
performance.
    The Welfare-to-Work Jobs initiative is already funded at $1.5 
billion in mandatory funding in each of fiscal year 1998 and fiscal 
year 1999. This initiative was enacted with bipartisan support in the 
Balanced Budget Act of 1997. The program provides formula grants to 
States; and Federally-administered competitive grants to Private 
Industry Councils, political subdivisions of States, and private 
entities to assist hard-to-employ welfare recipients to secure lasting, 
unsubsidized employment. Its success, however, depends on the formation 
of partnerships to allow leveraging of additional resources at the 
local level.
    I completed a national fact-finding welfare-to-work tour to put a 
human face on the framework we have developed to move people from 
welfare to work and have reported my findings to the President.
    There are a number of innovative programs out in the field that are 
making a real difference. Let me tell you about them.
    The Community Occupational Readiness and Placement Program (CORPP) 
Inc. serves people young and old, and even homeless, to help them 
realize their strengths and interests. CORPP provides a variety of 
programs to enable Philadelphia's urban poor gain employment. Over 90 
percent of all program graduates have gained employment and the 
retention rate is above 95 percent. Employed graduates are working an 
average of 33 hours per week with an hourly wage between $6-$8 per 
hour. CORPP gives participants the tools to take their first steps into 
the world of work.
    After having her first child at the age of 14, Sheree Smith 
enrolled in CORPP and was successfully placed in a job working as a 
receptionist for a State Senator earning $16,500 per year. She stayed 
for two years but continued to use the skills she learned at CORPP and 
to grow in her job. Last June, she went to work for a non-profit 
organization where she is the office manager for 16 employees and earns 
over $28,000 per year. I am pleased to report that Sheree is doing her 
part to contribute to the economy--she recently purchased a home.
    There are so many good programs, like those in South Carolina, 
Texas, Washington, Wisconsin, Iowa and Arkansas that have similar and 
innovative approaches to assisting people in moving from welfare-to-
work.
    The Bridges to Work program in Baltimore, Maryland provides a 
transportation link between welfare recipients living in job-poor inner 
cities and suburban employers. But the program provides a lot more for 
their clients. Bridges, whose clients must be job-ready welfare 
recipients, helps their clients find jobs, counsels them once they are 
placed, and provides assistance with child care and other needed 
services. They help them manage the vital logistics of their lives.
    Transportation is a key link. Over the last decade, Baltimore has 
lost over 50,000 jobs to the suburbs, while the nearby suburban 
counties have added at least 70,000 jobs. The story is the same in 
Chicago, St. Louis, Milwaukee and Denver--other sites where Bridges 
runs this innovative federal demonstration project. The job creation 
boom is not taking place in the inner cities, it is taking place in the 
suburban corridors, while there is still chronically high unemployment 
in the inner cities. Recent figures from the Department of Housing and 
Urban Development reveal that 97 percent of new businesses in the U.S. 
were created in the suburbs between 1990 and 1993. Most inner cities 
across the country, like Philadelphia, are recognizing the need for 
transportation alternatives that offer reverse commutes so that those 
people who want to work and in many cases have worked hard to get the 
skills to get into the job market, have the access to take those jobs.
    Promise Jobs in Iowa represents the coordination necessary among 
agencies to successfully move people from welfare to work. This program 
is jointly operated by local offices of the Iowa Workforce Development 
and JTPA grantees. It operates in each of the State's sixteen Service 
Delivery Areas and funds are provided through contractual agreements 
with the State Department of Human Services. The Dubuque-Delaware 
Consortium regularly uses multiple programs to support the self-
sufficiency plans of its participants. As they did in the case of 
Susan, a 30-year old single mother of 4 children, ranging in age from 
1-7 years old, with limited work history. The Consortium put together 
tuition, education, child care, transportation and job placement 
services, and Susan reached her goal of becoming a registered nurse. 
She is now making $12.50 an hour and is completely self-sufficient and 
off the welfare rolls.
    It is the dignity of work, as we move people from the welfare rolls 
to the payrolls, and the efforts of innovative programs and companies 
across the country, that will help to make the Welfare-to-Work 
initiative a success.
    Related to our Welfare-to-Work program, the budget proposes to 
extend, for one year through April 30, 2000, the Welfare-to-Work Tax 
Credit, which the President and Congress created as part of the 
Taxpayer Relief Act of 1997. It focuses on long-term welfare recipients 
by allowing employers to claim a tax credit of 35 percent on the first 
$10,000 of eligible wages in the first year of employment and 50 
percent of the first $10,000 in the second year of employment for 
workers they hire who were long-term welfare recipients. The budget 
also includes an extension of the Work Opportunity Tax Credit through 
April 30, 2000, which provides a credit of 40 percent on the first 
$6,000 of wages paid to members of eight target groups.
    Adult Training Grants provide formula grants to communities under 
authority of Job Training Partnership Act (JTPA) Title II-A for 
employment and training assistance to economically disadvantaged 
adults. This program also aids in our welfare-to-work efforts since two 
of every five participants is a welfare recipient. An increase of $45 
million, or nearly 5 percent above the fiscal year 1998 level, is 
proposed for fiscal year 1999 bringing the program's funding up to $1 
billion to support an estimated 401,100 participants.
    Legislation will be proposed in conjunction with the President's 
Budget that would authorize the Department of Veterans Affairs to 
transfer to the Department of Labor $100 million for the JTPA Veterans 
Employment program to reimburse activities designed to train, retrain, 
and provide employment assistance for unemployed and dislocated 
veterans. The program will provide outreach, assessment, counseling, 
on-the-job or classroom training, placement assistance and supportive 
services to help these veterans rejoin the American workforce.
    The Learning Anytime, Anywhere initiative is a joint Department of 
Education and Department of Labor program to emphasize the use of new 
technologies to enhance post-secondary learning by increasing access to 
and improving the quality of education and training delivery. The 
Department's $10 million request for fiscal year 1999 will allow the 
Department to explore removing some barriers faced by learning in non-
traditional settings, such as uncertainty as to quality, the value of 
certificates or degrees, and the limited availability of some training. 
The Department will provide an Internet-based system (America's 
Learning Exchange) linking providers of and customers for training and 
education and including: a library of courseware, a database of 
education/training opportunities, and a directory of learning 
opportunities.
    A net increase of $18.3 million is proposed to support and improve 
economic indicators. New this year is a proposal for $3.3 million to 
start the National Job Opening and Labor Turnover Survey. Currently 
there is no economic indicator of the demand for labor with which to 
estimate labor shortages in the U.S. labor market. Information on labor 
shortages can only be inferred indirectly using labor supply 
information, such as the unemployment rate. Developing a demand-side 
indicator of labor shortages at the National level would greatly 
enhance policy makers' understanding of imbalances between the demand 
and supply of labor.
    As part of this increase, the Department also proposes an 
additional $9.1 million for the second year of the multi-year Consumer 
Price Index Improvement initiative. Last year this Subcommittee 
supported the launching of this effort, for which I am grateful. This 
initiative allows the Department to continue undertaking a series of 
steps to improve the CPI's timeliness and accuracy by strengthening the 
statistical and methodological infrastructures supporting the current 
CPI program.
    The Department proposes $1 million to continue the work of a 
Presidential Commission on Workers and Economic Change in the New 
Economy. This initiative is an important component of a comprehensive 
set of initiatives announced by the President last Fall to help ensure 
that all Americans share the benefits of free and open trade. As the 
new economic forces change the standards for economic competition, they 
also affect organizational structures, skill requirements, and jobs. As 
part of the Administration's effort to help workers and those not in 
the job market to take advantage of the opportunities of expanded 
trade, this Commission will explore a variety of strategies for 
upgrading the skills of existing and future workers.
    The Department is requesting $2.4 million to establish a National 
Task Force on the Employment of Adults with Disabilities. According to 
the Census Bureau 74 percent of persons with severe disabilities 21 to 
64 years of age were not employed as of the last year surveyed (1994). 
The Task Force would be charged with the development of a national 
policy to bring adults with disabilities into gainful employment at a 
rate that is as close as possible to that of the general population. 
The Task Force will study the barriers to employment faced by disabled 
individuals and report its findings and policy recommendations to the 
President on a periodic basis over its four-year life.
 a secure workforce--promote economic security of workers and families
    In the area of worker retraining, our budget includes an increase 
of $100 million, or 7 percent above last year's level, for a total of 
$1.45 billion to support an estimated 685,800 participants in the 
Dislocated Worker Assistance Program.
    With the support of this Committee, the funding for this program 
has doubled since the President took office. The President is committed 
to tripling it over the next five years. This is a high priority 
because we know a fundamental element of a secure workforce--and 
helping workers manage change--is providing access to training and 
assistance to those workers when they need it. We want to build on the 
success we've had with our rapid response teams to move this goal 
forward.
    Back in August, the Fruit-of-the-Loom company announced that about 
4,800 workers in plants in Louisiana, Texas, and Kentucky would face 
layoffs in 60 days. Our Dislocated Worker Unit Rapid Response teams 
immediately contacted the plants in their States--and within 48 hours 
made arrangements for on-site strategy meetings--in partnership with 
state and local economic development, workforce development, and 
elected officials--to begin the full range of rapid response 
assistance.
    The layoffs were announced on August 7, by August 11 meetings were 
held in Louisiana with all the various players--and the next day our 
dislocated worker staff was meeting with the workers.
    Layoffs are always painful. But the rapid response team mobilized 
quickly, got in place, and helped workers look ahead and plan for their 
future. They set up worker assistance workshops that covered everything 
from resume writing to interviewing skills. They set up job fairs, 
training (including community college courses), direct placement, and 
related skills and remedial assistance.
    This year's budget increase will not only allow the Department to 
continue to provide this type of rapid response but it will also 
increase the number of people to be served (40,000 or more) and allow 
us to provide training and income support for laid-off workers in 
secondary industries doing business with primary firms affected by 
trade.
    As the President said in his State of the Union address, we should 
provide the same response when a factory closes as we do when a 
military base closes. This Department is at the forefront of making 
that happen. And I am absolutely committed to increasing job placement 
and wage replacement for workers who permanently lose their jobs in a 
plant closing or mass layoff.
    In the North American Free Trade (NAFTA) and Trade Adjustment 
Assistance (TAA) programs, legislation will be proposed to extend the 
programs for 5 years; expand eligibility for TAA to those who lose 
their jobs due to a shift in production abroad, similar to shifts in 
production to Mexico and Canada covered under NAFTA-TAA; increase the 
training cap; make the requirements linking training and income support 
more consistent across both programs; and finally, create a contingency 
funding provision to assure that resources are available to pay for any 
unexpected increase in benefit costs to eligible workers. The fiscal 
year 1999 request, including the legislative proposal, is a $108 
million increase over the fiscal year 1998 appropriation.
    The Unemployment Insurance (UI) System also needs to be reformed in 
order to meet the challenges of a new economy. The President's Budget 
anticipates legislation for a UI Safety Net to assure the availability 
of benefits for more of America's workers in the event of a recession, 
to make the program more accessible to low-wage unemployed workers, to 
improve the solvency of the State Trust Funds, and to improve State 
administrative operations.
    In addition to this legislative proposal, the fiscal year 1999 
budget includes a request for $91 million to strengthen the integrity 
of the Unemployment Insurance System, as authorized in the Balanced 
Budget Act of 1997. Tight budgets for unemployment insurance 
administration over the past several years have caused State agencies 
to cut back their investments in program integrity activities which 
affect benefit payment accuracy, detection of overpayments, collection 
of overpayments, and collection of under-reported taxes. Funding this 
proposal will reduce unemployment insurance errors and overpayments, 
improve State tax collections, and result in anticipated savings of 
well over $100 million to the Unemployment Trust Fund in 1999 alone.
    The fiscal year 1999 Unemployment Insurance budget also proposes $8 
million for the one time cost of transition to the North American 
Industrial Classification System. This will allow the exchange of data 
among North American countries as well as provide for increased 
precision in identifying industries as a result of utilizing six rather 
than four digit codes. Similar investments were made in BLS for this 
project in fiscal year 1997 and fiscal year 1998.
    Another important part of promoting economic security for workers 
is to provide pensions. I can't overemphasize the importance of 
retirement security. Today Americans are living longer and are more 
concerned about saving enough money to maintain their standard of 
living throughout retirement. One of the basic problems is information 
and education.
    Many workers do not have access to basic retirement and savings 
information that can help improve their understanding of steps they can 
take for long-term financial security. We want to change that. That's 
why, working with the public-private American Savings Education 
Council, we have launched a Retirement Savings Education Campaign to 
inform Americans about the importance of saving for retirement and to 
encourage employers to establish pension plans for their workers. We 
already have over 250 campaign partners representing federal agencies, 
trade and professional associations, labor unions, community groups, 
financial entities, and private sector employers.
    I have held a series of roundtable discussions with owners of small 
business around the country to discuss barriers and the options 
available in offering retirement plans to workers. In Dallas, I met 
with women small business owners. There is no doubt that small business 
has a big role to play in improving the retirement security of workers. 
Our nation's small businesses employ 40 percent of the workforce--and 
32 million workers in small businesses do not have an employer-
sponsored pension plan.
    I wanted to hear from these women about the obstacles they thought 
they faced to offering plans and to listen to some of the tips they 
picked up and lessons they have learned as small business owners. The 
goal of our education campaign is to change the way the American public 
thinks and acts about retirement needs. Americans need to reconsider 
how their personal finances are managed, begin saving early for 
retirement, save more and select retirement savings options that offer 
them the fullest advantage.
    With the funding provided in the President's fiscal year 1999 
Budget, the Department will develop new public service announcements 
for our targeted audiences, produce a video for small businesses to 
identify pension plan options and encourage them to establish a 
employer-sponsored plan and, of course, we will work in partnership 
with the President, members of Congress, and our private and public 
sector partners to conduct a National Summit on Retirement Savings this 
summer.
    All of this will help expand pension coverage to many of the 50 
million workers not covered by pension plans and enhance the security 
of pension plans already in existence. We must protect pensions and 
make them more portable.
    The Administration will be proposing legislation to expand pension 
coverage to some of the more than 50 million American workers who are 
not earning these benefits on their job by making payroll deduction 
arrangements more widely available, offering a tax credit for small 
businesses to defray the costs of starting a new plan, creating a new 
and simpler defined benefit plan for small businesses and requiring 
that workers more rapidly be vested in their employer contributions to 
401(k) accounts. These proposals will also enhance the security of 
pensions by requiring that better information be provided to workers 
about their benefits, improving the audit of plans, and extending the 
Federal government guarantee for certain types of plans.
    The Department's fiscal year 1999 request includes an increase of 
$7 million for pension plan protection activities. This includes an 
increase of $4.5 million for the transition to the new Form 5500 ERISA 
Filing Acceptance system (EFAST). For the past 2 years, this Committee 
has supported the Department's efforts to develop this new system, 
which will soon be in operation. Securing pension benefits, in part, 
occurs when plan officials and service providers understand the 
requirements of the Employment Retirement Income Security Act (ERISA) 
and meet their responsibilities under the statute, including their 
responsibility to file annual reports with the Department. With these 
funds, the Department will also establish a ``help desk'' operation and 
develop a program for direct filing entities. The new system will 
improve the quality and accuracy of processed data and speed their use 
in safeguarding pensions. The investment in the new system will yield a 
projected net savings to the Federal government of approximately $57 
million over the 5-year life cycle of the system.
    The Department also proposes an increase of $1.6 million for the 
Pension Plan Service Provider Investigative Probe to be conducted by 
the Office of Inspector General. This initiative will enhance 
retirement security by identifying and investigating racketeers and 
criminal enterprises who manipulate the investment of pension fund 
assets for their own benefit.
    The Department also has a role in private health benefit 
regulation. The fiscal year 1999 budget proposes $4.6 million to 
administer the Department's responsibilities related to implementation 
of health care reforms in the new health care laws. The Health 
Insurance Portability and Accountability Act of 1996, the Newborns' and 
Mothers' Health Protection Act of 1996, and the Mental Health Parity 
Act of 1996 establish many new protections for employee health 
benefits. These laws added new provisions to the Employment Retirement 
Income Security Act (ERISA) and demand additional regulatory, 
interpretative, enforcement, and disclosure efforts. The Department is 
working in conjunction with the Departments of Health and Human 
Services and Treasury on the implementation of these new laws.
    The President has proposed legislation to allow early retirees to 
buy into Medicare. The Administration is concerned about the plight of 
older workers who unexpectedly lose their health benefits when they 
lose their jobs or retirees whose benefits are eliminated. Too many 
Americans who have worked hard all their lives suddenly find themselves 
losing their health coverage just at the time when they need it most 
and can afford it least. The President's proposal would provide 
dislocated workers with an option to continue coverage under Medicare 
by buying into the program for as long as they need it, or until 
standard Medicare coverage becomes available. Retirees who lose their 
benefits will also be able to extend COBRA benefits in order to 
maintain access to the health care that is essential for them.
    There are several new proposals, totaling $17.2 million, in the 
Department's Workers' Compensation Programs in fiscal year 1999 to be 
drawn from the benefit funds established for these programs. One 
proposal is for an expansion of $3.2 million in the Periodic Roll 
Management (PRM) program that supports the Federal Employees' 
Compensation Act (FECA) program. This proposal is designed to reduce 
the costs of the Federal government's workers' compensation program by 
re-evaluating long-term disability cases. Also, there is a proposed 
financing shift of $3.5 million from general revenues to the fair share 
collections in the Special Benefits account. Funding the PRM from these 
employer-supplied ``Fair Share'' funds in the Special Benefits account 
properly ties these staff investments directly to the account which 
will accrue the resulting savings. With the expansion of the PRM 
project, the total estimated savings in benefit payments by the Federal 
government from fiscal year 1992 through fiscal year 2002 will be 
approximately $672 million. The Office of Workers' Compensation 
Programs has also proposed an additional $3.3 million for the Black 
Lung program to facilitate Year 2000 conversion.
 quality workplaces--foster quality workplaces that are safe, healthy, 
                                and fair
    The Administration proposes $37 million for a multi-faceted 
initiative to fight abusive child labor, both internationally and 
domestically. I would particularly like to recognize Senator Harkin's 
national leadership on this issue over the past 4 years.
    As America takes its place in the global economy, international 
labor standards, particularly prohibitions on forced labor and 
exploitative child labor, benefit all economies. To provide additional 
support for the International Labor Organization's International 
Programme for the Elimination of Child Labor (IPEC), the Department 
requests $27 million, increasing the total amount available in grants 
to $30 million. This increase would ensure continuity, expansion and 
sustainability of existing IPEC programs. This increased funding would 
allow the ILO to include more countries in their technical assistance 
programs, and conduct more detailed analyses of issues of child labor 
and exploitative labor practices worldwide. These additional funds 
would expand the program in a way that is consistent with the lead role 
the United States plays in the fight against child labor exploitation 
worldwide.
    We can't lead internationally unless we do all we can at home. 
Domestically, there has been considerable progress in reducing illegal 
child labor. However, problems persist--particularly in agriculture 
where working families face additional problems resulting from 
inadequate child care and illiteracy. An increase of $5 million in Job 
Training Partnership Act Pilots and Demonstrations is proposed to 
develop new models for work and learning opportunities, including 
mentoring, for young migrant farmworkers so that they may qualify for 
other job opportunities with career potential.
    The Department also proposes $4.1 million to increase compliance in 
targeted industries, including garment manufacturing, agriculture, 
health care and other low-wage industries. While maintaining planned 
education and outreach among agricultural employers and a near term 
focus on ``salad bowl'' commodities, these additional resources will 
enable the Department to double its current level of effort and 
specifically target those crops and regions where the data and 
experience suggest the prevalence of child labor violations. Also 
included in this amount is an additional $800,000 for expansion of the 
National Agricultural Workers survey to include significant data on 
child labor.
    In another area of child labor enforcement, the Department proposes 
a $1 million increase for a review and update of child labor hazardous 
occupational orders, which pertain to child safety in the workplace. 
These hazardous orders, the last of which were issued in the early 
1960's, will be updated to take into account new industries and 
technologies and address the needs and dangers of today's workplaces as 
they relate to young workers.
    Worker safety and health is essential to a quality workplace. The 
budget proposes $355 million, an increase of $18 million, for workplace 
safety and health programs. An increase of $2.8 million is proposed to 
support workplace safety and health enforcement in fiscal year 1999. 
This initiative builds upon the Department's commitment to focus on 
inspections on worksites with the highest lost work day injury and 
illness rates, either through the Cooperative Compliance Program or an 
alternative mechanism. Proposed funding will support front-line 
compliance officer penetration and expand the level of compliance 
assistance offered to employers choosing to partner with the 
Department. The Department also will highlight the construction trade 
in an effort to focus on the leading causes of fatalities in that 
industry. An increase of $1.3 million is included to enable State 
partners to meet new challenges and complement Federal program 
strategies. The budget proposals also include $4 million to enhance 
training capabilities offered by the Department and to direct outreach 
materials towards specific industries, work processes and localized 
safety and health issues. These funds also will allow for augmentation 
of state consultation programs which provide free on-site consultations 
to employers upon request.
    Continuing the work of the New OSHA which emphasizes a cooperative 
approach, balancing enforcement with compliance, is already making a 
big difference. You can talk with the owners and workers of EZ Paintr 
in Milwaukee, Wisconsin about that. Through its cooperation with OSHA 
in Wisconsin, EZ Paintr, a paint roller manufacturer, reduced its 
workplace injuries and illnesses by nearly 60 percent and cut its 
workers' compensation costs by more that 80 percent (from 1991 to 
1994).
    When OSHA inspected EZ Paintr in 1992, the company had a lost 
workday injury rate of 13.9; by 1996, it had dropped to 5.1. As the 
owners of EZ Paintr have noted, ``working together with our employees 
to provide a safe workplace makes monetary sense.'' Throughout the 
process, the company also worked closely with the United Steelworkers 
Union. Continuing on this common sense, cooperative approach will truly 
help us achieve my goal of reducing accidents, injuries and illnesses 
in the workplace.
    The budget also proposes $211 million, an increase of $8 million, 
for mine safety and health programs. To address concerns about the 
effectiveness of a major component of the Federal program to protect 
miners from exposure to respirable coal mine dust and quartz, the 
Department took steps in fiscal year 1997 and fiscal year 1998 to 
increase Federal monitoring of exposure limits to aid in restoring 
confidence in the Federal program. In fiscal year 1999, an increase of 
$2.7 million is proposed to target sampling inspections at coal mines.
    The Department is also proposing to increase resources by $1.2 
million for the analysis and resolution of difficult compliance 
problems for targeted hazards, while taking a cooperative approach with 
mine operators to encourage long-range solutions for a safer and 
healthier work environment.
    A fair workplace is also essential for a quality workplace. The 
Department proposes $67.8 million, an increase of $5.5 million, to 
implement a compliance assistance strategy in civil rights enforcement 
and to expand its Fair Enforcement Initiative to support the 
Administration's efforts to strengthen enforcement of civil rights 
laws. The compliance assistance strategy will implement technical 
assistance and training guides for contractors; encourage Federal 
contractors to self evaluate their EEO performance; and develop and 
deliver grass root technical assistance seminars. This proposal will 
help contractors comply more easily with their EEO obligations. The 
Fair Enforcement Initiative will increase the number of contractors 
brought into compliance while reducing burdens on contractors, such as 
paperwork requirements. This proposal allows the Department to continue 
a Fair Enforcement strategy which includes a tiered review process, 
upgraded information technology capabilities, and paperwork reduction.
    Finally, the Department proposes a $5 million Child Care initiative 
which will support the President's proposal to greatly improve the 
quality of services provided by day care providers. Quality child care 
service goes hand in glove with having an adequate supply of competent, 
professional child care providers. In fiscal year 1999, the Department 
proposes to expand the registered apprenticeship system using these 
funds to assist States in building their infrastructures and 
replicate--based on a nationally recognized West Virginia model--
training for skilled Child Care Development Specialists in at least 10 
States. This initiative provides industry-recognized certification and 
development of career ladders in the child care field.
             government performance and results act [gpra]
    Under my leadership, since my arrival in May, the Department has 
taken GPRA very seriously and I believe we have made considerable 
progress in meeting both the legal requirements and the spirit of the 
Act. We realize, however, that there is more work to be done as the 
Department continues to refine its strategic plan to move further 
toward an outcomes focus. The performance plan recently submitted with 
the budget request reflects my budget and program priorities, arrayed 
by the strategic goals, to achieve the results planned for the 
Department in fiscal year 1999. This Plan also responds to concerns 
raised by the Government Accounting Office (GAO) and Congressional 
staff during their review of the Department's Strategic Plan that it 
did not adequately reflect the integrated and cross-cutting nature of 
the Department's programs and activities. We are committed to working 
with the Office of the Inspector General (OIG) and GAO to improve our 
management systems and procedures. The OIG has agreed to work as a 
partner with the Department to provide the Congress and me with advice 
on how to attain the highest possible results from program performance.
    One of the primary aims of the Department's fiscal year 1999 Annual 
Performance Plan is to advance the Department toward achieving my 
vision of an integrated Department, one in which component agencies 
work together to achieve common goals. This plan represents a major 
step in that direction, as capitalizing on the commonalities and 
linkages between DOL's agencies is critical for successful plan 
accomplishment.
    A major management challenge in fiscal year 1999 will be to 
establish a process aimed to assure the Department's performance and 
level of accountability for program results. To oversee implementation 
of the Department's fiscal year 1999 and subsequent Performance Plans, 
and coordinate all the Department's programs as a unified Department of 
Labor, I will institutionalize a strategic management process to 
maintain a central focus and accountability of the Department's many 
programs and activities. This is in addition to current efforts 
designed to better align performance-based information systems, 
including a unified capital planning evaluation process for information 
technology systems, financial management integrity to obtain a clean 
audit opinion of the Department's Financial Statement on an annual 
basis, and human resource utilization.
    I believe that the fiscal year 1999 Annual Performance Plan, which 
is directly tied to my budget request, sends the American public a 
clear message of the purpose and mission of the Department and 
represents a commitment to the achievement of my strategic goals--a 
prepared workforce, a secure workforce, and quality workplaces. The 
Plan presents the programs, activities, and achievements that DOL will 
strive to accomplish in fiscal year 1999, the means by which its 
performance will be evaluated, and the standards to which it will be 
held accountable by Congress and the American public.
    I look forward to working with the committee and I thank you for 
the opportunity to appear before you. I will be happy to respond to any 
questions.

                         Job training programs

    Senator Specter. Thank you, Madam Secretary. I thank you 
for coming to Philadelphia shortly after you were confirmed and 
sworn in, where we took a look at one of the very important job 
training programs. There is an enormous need in America today 
for job training. We have a low unemployment rate, but within 
that group there remain people who could undertake work if they 
had the training and also if they were located in the right 
spots. So the transit bill which we passed last week with the 
reverse commute from, say, center city Philadelphia to 
Montgomery County, a suburban affluent county, and to Reading, 
PA, in Berks County, taking people from areas where people have 
no jobs to areas where they do have jobs, is a very important 
component.
    The tax break, where there is a fringe benefit which is not 
taxable where people can get transit fare up to $780, I just 
was discussing this with my distinguished colleague, Senator 
John Chafee, the author of that bill, could be very, very 
important.
    With respect to the Welfare-to-Work Grants Program, I would 
like to go over with you some of the components. But first 
could you share with the subcommittee what you have learned 
from your tours of local projects around the country? What are 
the biggest problems, and how successful have we been in 
involving the private sector?
    Secretary Herman. Let me respond to the question on two 
levels, Senator, first, as a result of my tour what were the 
key learnings, and second, what can we do more to involve the 
private sector. With regard to the tour, it was a 10-city tour 
for me commencing in October of last year and just ending in 
February of this year. Coming away from that tour I believe 
that we have several challenges if we are going to ensure that 
welfare-to-work is successful for the long haul this time 
around. If you would permit me for just a few moments to expand 
on some of those challenges.
    Senator Specter. By all means.

                            welfare to work

    Secretary Herman. The first I believe is a recognition that 
these individuals who are making the transition from welfare to 
work really want to be treated as workers. I call them new 
workers, especially today, because it is clear to me that they 
are suffering from the stigmatization of being labeled as ex-
welfare recipients, and, therefore, they do not feel as though 
they have the ability to leave their past behind them and to 
really begin anew, and to really get a firm toe hold, if you 
will, in the labor market today with all of the rights and 
protections that other workers are entitled to. So I think a 
recognition, first of all, of these individuals as a new source 
of talent, as a new labor supply, is very important for us 
psychologically as a country, and not to label them under the 
old traditional stereotypes.
    Second, I repeatedly saw in all of the cities that I 
visited the three biggest barriers to maintaining a job today--
child care, transportation, as you so correctly just pointed 
out, and housing. But I would have to say the biggest barrier 
is, in fact, child care, and then transportation. We are going 
to have to do a lot more to make sure that we can move workers 
to where the jobs are since we know today that three out of 
four jobs are in suburban communities. Two out of three of 
these individuals who are trying to make the transition are in 
inner cities, so there is a clear mismatch between where the 
workers are oftentimes and where the jobs are. So innovative 
strategies around transportation, as well as child care 
support, are going to be very important.
    Third, I would say historically we put a lot of emphasis on 
getting jobs. We have not put enough emphasis on keeping jobs. 
I believe that in order for this population, especially the 
hardest to serve that remain, to be successful we are going to 
have to do a lot more to stress mentoring and coaching and 
other kinds of support services to enable individuals to stay 
on the job, and to follow them for longer than the prescribed 
periods that we have in the past.
    I would also add parenthetically that while there is much 
that is being said today about the decrease in welfare roles, 
that I believe the biggest challenge really remains because the 
hardest to serve really still remain on the rolls, those with 
multiple barriers, poor work histories, low to no educational 
experience or work histories. I believe that we do not have a 
lot of experience, quite frankly, with serving that population.
    Last, I would just comment on a need for a focus on 
fathers. So much of our welfare attention has correctly been 
placed on mothers who are largely raising these children alone 
in their own families, but not enough is being said about 
fathers. While we have certainly beefed up our efforts in the 
criminal justice system to enforce child care payments, you 
need a job in order to pay child support. We have got to do a 
lot more, I believe, to bring fathers into the loop, to be 
responsible parents as well, as a part of this welfare-to-work 
initiative.

                      Welfare to work coordination

    Senator Specter. Madam Secretary, with respect to 
developing a plan to coordinate welfare implementation with 
other departments, Transportation, HUD, HHS, it is projected 
that HHS Secretary Shalala will have the chief oversight 
policy. When will you finalize your plans, and tell us, if you 
can, how it will function coordinated with those departments 
and perhaps the Department of Justice, particularly in the area 
for training for juvenile offenders who will have unique needs 
for shaping what they can do in the workplace?
    Secretary Herman. With regard to the coordination, we do 
have a staff working group representing various agencies who 
have responsibilities for the welfare-to-work initiative, 
looking at better coordination and how we can work more closely 
together to ensure success of our welfare-to-work initiatives. 
Specifically with the responsibilities that Congress gave to 
the Department of HHS and Secretary Shalala for the overall 
evaluation of this effort, we are working very closely with the 
HHS team on the inputs into that evaluation so that we can make 
sure that we are going to appropriately measure the right 
outcomes, the right results for this initiative. I am confident 
that the close relationship that we have with HHS is going to 
result in better coordination in the field as a result of it.
    As we look in particular at our efforts to coordinate with 
departments like Justice on juveniles, we see as you know, 
Senator, that many of these young kids today come from families 
who are on public assistance. So our efforts on the out-of-
school youth initiative, as well as what we are doing to more 
intensely work with these young people, will also be 
coordinated.
    I was particularly struck by recent data which suggests 
that when we look at our out-of-school youth population, that 
we are focussed on as a part of welfare-to-work, that generally 
12 percent of them are juvenile delinquents. If you look in 
particular at African-Americans in this population, you are 
talking about 34 percent of that particular group. So we have 
to have greater coordination, in my view, if we are going to be 
successful in this area, with the Justice Department.

                  Youth offender demonstration grants

    Senator Specter. Madam Secretary, in the Judiciary 
Committee we are wrestling with a juvenile crime bill. We have 
had quite a battle, and we split 9 to 9 on whether the lion's 
share of the funding should be in prisons or whether there 
ought to be rehabilitation. My views are that we have to divide 
the criminal element into two parts, the career criminals, 
those are people who have committed three or more major 
offenses, and isolate them from society with life sentences. 
But as to others, where they are going to be released, and 
especially with juveniles, I believe we have to approach it 
with a so-called seamless web to try to move them through the 
educational process, and if they become delinquents to have 
literacy training and job training. If you release a functional 
illiterate without a trade or a skill, that individual goes 
back to a life of crime.
    Now, I am pleased that we were successful in providing your 
Department with $12,500,000 for youth offender demonstration 
training grants for the new program which starts July 1, 1998. 
Have you made any of those grants, and what do you project for 
the future on that subject?
    Secretary Herman. We have not made grants to date, Senator. 
The funds will be available, as you said, July of this year. We 
have been working, however, on developing the competitive 
guidelines that will go to States to make the appropriate 
requests for those funds. As a part of the guidance that we 
will be giving in this area, we intend to work very closely not 
only with our State and local work force development boards but 
also with correctional institutions and facilities to be able 
to target this population in particular.
    Senator Specter. When you move ahead on that program, Madam 
Secretary, I would be interested in your Department's 
evaluation as to what funding is really necessary on the 
training grants for juvenile offenders. My sense is that if we 
really were serious about violent crime, that we could cut it 
by about 50 percent, if we trained, literacy training and job 
training, those people who are going to be released. It is for 
public safety, No. 1, but obviously for the quality of life of 
those individuals. It has always seemed to me just ridiculous 
that we have not allocated the resources necessary for that 
kind of realistic rehabilitation.
    So as you work through the program, the subcommittee would 
appreciate it if you would give us your appraisal as to what 
really is necessary on a nationwide basis to do the job.
    We have been joined by the distinguished Senator from 
Arkansas, one of the distinguished Senators from Arkansas, one 
of the most distinguished Senators in the body, Senator 
Bumpers.

                    remarks of senator DALE BUMPERS

    Senator Bumpers. Thank you very much, Mr. Chairman. 
Secretary Herman, Tuesday morning my chief of staff and I were 
driving to work and I was telling her that during a speech I 
made the night before to 300 or 400 Arkansans who were in town, 
mostly business men and women, that as I closed out my remarks 
I talked about what a great country this was. I remarked on how 
fortunate we were to live in a civilized society under the 
magnificent organic law we call the Constitution, and how 
wonderful it was to know that when we sat down to eat we knew 
that the food had been inspected and was pure, that when we 
took medicine we knew that medicine had been tested over and 
over again, when we got on an airplane we knew that we were 
being handed off by a computer in Oberlin, OH, to a computer in 
Memphis, TN, and the security one feels with all of that.
    I grew up in the South, poor, during the Great Depression, 
and was the beneficiary of tremendous Government assistance. 
But while I was talking I saw a husband and wife in the back of 
the audience who were demonstrating through their facial 
expressions their contempt for what I was saying. When you have 
made as many speeches as I have you can pretty much tell what 
is on people's minds and whether they are agreeing or 
disagreeing with what you are saying. These two people were 
obviously disagreeing just by their motions and actions.
    She said is it not amazing how many people are irrational 
about their contempt and hatred of Government, and I said yes, 
but this guy may have just had a terrible experience with the 
IRS. He may have had a terrible experience with somebody else, 
like OSHA. It may be that while he thought he was running a 
good plant, treating his employees well, trying to comply with 
the laws as best he could, OSHA inspectors swooped down on him 
and the first thing you know he is being fined. After 3 months 
of harassment he is being fined, he is being abused, 
linguistically, as well as financially, and he thinks it is an 
unnecessary and unwarranted intrusion into a business which he 
feels he is running well and serving everybody's purposes.

                      training of OSHA inspectors

    Such was the case as far as I am concerned with Hudson 
Foods in Noah, MO. I am sure I do not know all there is to know 
about that, and I blame the Department of Agriculture for 
forcing the sale of Hudson Foods, which I believe was as 
innocent as innocent could be. The E.coli came into that plant 
from another federally inspected plant, but the owner of Hudson 
Foods bore the brunt of the whole thing. He had no choice. His 
name was in lights all over the Nation for 1 month, and his 
sales declined to nothing. He had no choice but to sell, and he 
sold the corporation for $300 million less than it would have 
brought 2 days before this happened.
    So if Mr. Hudson and his wife had been in the audience and 
they had been making those faces, I would have understood, 
whether I was talking about food inspection service or whether 
I was talking about OSHA.
    Just let me ask you this. What kind of training do these 
OSHA inspectors get so far as their conduct in a plant is 
concerned, not their technical skills at picking out violations 
of safety standards, but just their conduct, their attitude? I 
ask you this in the utmost good faith as one who has championed 
and voted for strict OSHA regulations ever since I have been in 
the Senate, and even when I was Governor and charged with the 
responsibility of administering a lot of them. What kind of 
instructions do these people get before they go into a plant 
about their conduct and their attitude toward the people in the 
company?
    Secretary Herman. Thank you very much for your comments and 
your questions, Senator Bumpers. They do get classroom training 
and they do get training in terms of how to approach businesses 
today. As you know, this is my second tour of duty at the 
Department of Labor. I was there 20 years ago, and I can 
honestly say that one of the things that has impressed me the 
most about coming back to the Department 20 years later is the 
attitude and the spirit of what I call the new OSHA, and the 
culture changes that OSHA really is trying to bring about today 
in terms of how it does business. That culture change involves 
the way it goes in today to conduct an inspection.
    If you will recall the old OSHA, they had random surveys. 
They were not necessarily targeted on the most hazardous 
industries. In the old OSHA you did not get any prenotification 
even that someone was coming in. It was always the surprise 
factor. In the old OSHA you had no chance to correct a finding 
or violation, the way you do now under the new OSHA with many 
of the changes that have been put in place.
    But the changes, the culture changes that are taking place 
in the new OSHA do require that we provide substantial training 
of our employees and of our inspectors, so that this new way of 
doing business, if you will, is felt more broadly in the 
organization. So I want you to know that we are on the road, I 
believe, to making positive changes for the better. I think we 
are working much more cooperatively with businesses, with small 
businesses in particular, and we have beefed up our own 
training requirements. That includes not only classroom 
training for our inspectors but on-the-job training as well.
    Senator Bumpers. Secretary Herman, I see my time is up, Mr. 
Chairman, and I am going to have to leave, but let me just 
remind----
    Senator Specter. If you would like to take a little longer, 
Senator Bumpers, go ahead. I am sure Senator Kohl would yield 
to you his time. [Laughter.]

                     targeting of Poultry industry

    Senator Bumpers. Thank you, Senator Kohl. Let me just say 
that I believe the stories I heard that came out of that plant 
about OSHA's conduct for 3 months. They were there for 3 
months. Not only did they check the payroll records, they 
checked everything. Bear in mind that this was a 2-year-old, 
state-of-the-art, $11 million plant. I saw some of the pictures 
of the things that were considered to be violations. I suppose 
from a superficial standpoint maybe that would stand up, but it 
certainly did not look to me like anything that would warrant 3 
months of activities by so many people in that particular 
plant.
    My closing question is this. At some point during Robert 
Reich's tenure as Secretary preceding you, there was an 
understanding, and you could never convince the poultry 
industry any differently, that they were being targeted by 
Labor because a lot of these plants are not unionized. You have 
seen those stories.
    Secretary Herman. Yes, I have, Senator.
    Senator Bumpers. They had no reason not to believe them. I 
am not sure exactly what Secretary Reich's statement was, but 
it was something to the effect that they were targeting this 
group. I am going to tell you something. I do not believe in 
targeting. I do not believe an entire industry in the United 
States deserves to be targeted. If you have a legitimate 
complaint that you consider credible from a credible source 
about violations in any kind of a plant, you will never hear a 
complaint from me if you investigate. But to take on the steel 
industry or the poultry industry or the beef industry or any 
other industry simply because you have heard rumors to a 
certain effect is absolutely unacceptable to me.
    You do not even have to respond to that, but I would like 
for you to respond to whether or not the Department of Labor 
has, in fact, started a lot of investigations based on the idea 
that this particular industry ought to be targeted?
    Secretary Herman. Well, I can certainly say, Senator, in 
regard to the poultry initiative, that I believed very strongly 
that we should engage in consultation, that I was not someone 
who wanted to play the ``gotcha'' game or have surprise raids, 
if you will. That is why we have reached out to the poultry 
industry. We did meet with more than 50 producers in the 
industry to talk about what the issues were and what the 
concerns were.
    Where we are at this point is that we have come back with a 
series of findings and recommendations, and the staff is 
presently engaged in putting those findings and recommendations 
back into the field so that everyone has the benefit of that 
knowledge and information to decide on appropriate steps and 
recommendations. I think, quite frankly, Senator, a lot of us 
were surprised at some of the information that did come back 
that I believe in the end will help not only the industry but 
all of us who are concerned about safety issues in the poultry 
industry. We are making that information generally available so 
that we all have the opportunity to see it and to examine it, 
and to ask ourselves what are the best corrective actions.
    One of the things, just parenthetically, that we found that 
was contributing to the most injuries in the industry were 
slips and falls resulting in back injuries that actually had to 
do with the chicken fat that was on the floor. That is not 
something that one would have thought would have manifested 
itself as the greatest finding in terms of the injury and 
accident rate, but that is one of the findings, for instance, 
that came out of the survey.
    But we are putting all of that information back into the 
field, and what we want to do is to continue to consult as to 
what we should do to correct these findings.
    Senator Bumpers. Well, it would be OK with me if you 
started a crash course over there on teaching some of those 
people what civilized conduct is.
    Secretary Herman. I can appreciate those comments, Senator.
    Senator Bumpers. Thank you, Mr. Chairman.
    Senator Specter. Thank you, Senator Bumpers. Senator Kohl, 
you have your full time, of course.

                      remarks of senator HERB KOHL

    Senator Kohl. Thank you, Senator Specter. Ms. Herman, I 
wanted to ask you about retiree health care coverage. In 
Milwaukee the employees of the Pabst Co., are not alone in 
this, but they, as you know, had their health care coverage 
eliminated by the employer as a result of a contract loophole. 
They were left stunned and disappointed, and in many cases 
unable to handle their health care coverage because their 
company, which had promised them in writing that their coverage 
would be maintained as retirees, simply decided it had become 
too expensive and they eliminated that benefit to these people.
    My question is what can you do for those people at the 
Pabst Co., and at other companies who have had this happen to 
them? And beyond that I would like to ask you whether or not 
there is legislation that you or we need to propose and enact 
to ensure this retiree health coverage?
    Secretary Herman. Thank you very much, Senator, for your 
question. President Clinton in his most recent announcements on 
Medicare buy-in took into consideration not only the issue of 
what happened with the workers at Pabst, but as you have 
correctly pointed out, other workers who have had promises 
broken to them by their employers for their health coverage as 
a part of their retirement benefits package. As you know, the 
Department has been a friend of the court in the Pabst 
situation, as with other situations, to try and get employers 
to maintain and to keep those promises.
    Recognizing that that is not happening, the President has 
proposed that we allow those workers, such as the workers in 
the Pabst Brewing Co., who had promises to them broken, to be 
able to purchase COBRA coverage for up to 125 percent of the 
average cost of active employees, and to have the option of 
extending that COBRA coverage until they are eligible for 
Medicare. The other consideration that the President put 
forward is the ability to buy into Medicare if you are 55 years 
of age and older, if you have been dislocated from your job so 
that you have that as a bridge, as a fall back, as some of 
these workers were also dislocated as a result of the actions 
that have been taken there and in other communities.
    So I am hopeful that both of these provisions will actually 
help workers, one, those who have had promises broken, and two, 
those who have been dislocated from their jobs, to have the 
ability to continue some kind of health coverage for 
themselves.

                   Pabst retiree health care coverage

    Senator Kohl. Is there anything in particular that you can 
offer these employees at the Pabst Co., now?
    Secretary Herman. Right now what we are looking at as a 
part of our own beefed up dislocated worker assistance program 
is going in with rapid response teams that are not only working 
to certify workers for new job situations, but also to look at 
what the benefit packages can be as a part of those new job 
environments that we are doing job search and job assistance 
with. This will not help the Pabst workers, but certainly it 
was instructive for us to see what those workers experienced, 
to know that we have to go in on a much faster pace to be able 
to act as an intermediary in the labor market and to be a 
bridge for them to other employment situations to get other 
opportunities, and not have the time lag in such a way that by 
the time that we do move in oftentimes we have either lost 
contact with the workers or certainly they have given up on any 
viable alternatives being available to them.
    Senator Kohl. I appreciate that. I know it is a knotty 
problem without an easy answer, but, you know, to those people 
in particular, and we are here to help people one by one, if we 
do that then we help everybody. Those people in particular at 
the Pabst Co., are out of luck right now. They are out of 
pocket and they are not able to cover their health insurance. 
The legislation that is being proposed, hopefully, will get 
passed, but it is not there right now.
    Is there something that you can suggest that your 
Department and we, working together, can devise to help those 
people?
    Secretary Herman. What I would be very interested in trying 
to do, and I have asked our team at Labor to look into this, is 
to actually go back and to track those workers basically to see 
where are they right now and what is the current state. We just 
had a very successful experience with that kind of an effort in 
the State of Louisiana with Fruit of the Loom plant closings 
there, because we were able to go back in with a better data 
tracking system to bring those workers, if you will, back into 
a matrix so that we could help facilitate not only training 
assistance but job search and job placement assistance. I am 
pleased to report that almost 70 percent of them have now been 
served, and I am hopeful that we will be able to get the other 
30 percent. What I would like to do is to go back and to take a 
look as well as to what has gone on with those workers in 
Milwaukee.
    Senator Kohl. I would appreciate that opportunity to work 
with you and your Department for those people to see if we 
cannot help them to get some kind of coverage.
    Secretary Herman. We will take a look at it, Senator.
    Senator Kohl. I do appreciate it. Thank you so much. Thank 
you, Mr. Chairman.
    Senator Specter. Thank you, Senator Kohl.
    [The statement follows:]

                Prepared Statement of Senator Herb Kohl

    Thank you, Mr. Chairman. Madam Secretary, it is always a 
pleasure to see you. Thank you for giving us this opportunity 
to delve into some priorities addressed in the 1999 budget.
    In this new era of balanced budgets there are tight 
restraints on spending initiatives. Yet even though there are 
fewer funds to go around, the pressures of globalization on 
today's workers and businesses continue. While America leads 
the way in many industries, in other sectors consolidation is 
taking place and workers are being downsized. These people need 
to be given the skills to move from industries of the past to 
the technology of the future. The key to rising wages in 
today's economy is mastering innovative technology.
    Whenever I speak to young people I always stress to them 
the importance of learning a skill. Whether they go to college 
or vocational school, they have to enter the job market with a 
skill that the marketplace values. The job training 
opportunities offered by the Federal government are important 
tools used by many young people to gain these skills. I look 
forward to hearing how the Department of Labor's budget intends 
to expand opportunities for young people.
    While we are enjoying this time of economic growth, we must 
not forget those who have been left behind. Unemployment may be 
low, but it continues to burden too many individuals and 
families. Some of these workers have a long work history and 
will only be dislocated for a short period. Others, for 
instance those moving from welfare to work, are trying to find 
a job after being out of the work force for many years. These 
folks are the hardest and most expensive to serve. At the same 
time, the labor market is very tight and they have the best 
chance in a long while of finding a job. The stakes are high 
because if we cannot help these people find a job now, what 
will happen to them during an economic downturn? We have to do 
all we can to get them the job experience and skills they need 
so that when a recession occurs they have what it takes to keep 
their jobs and weather the storm.

                   remarks of senator LAUCH FAIRCLOTH

    Senator Specter. Senator Faircloth.
    Senator  Faircloth. Thank you, Mr. Chairman, and thank you 
for holding this hearing. Thank you, Madam Secretary, for being 
with us.
    I was elected to the Senate to create workfare and not 
welfare. That was what I ran on, and I notice that in Wisconsin 
Gov. Tommy Thompson says he has written his last welfare check. 
I hope he is right, because everyone who receives benefits now 
is required to work for those benefits. I am a great admirer of 
Governor Thompson and what he has done over the years. As a 
founder of the Senate to preserve a real welfare reform working 
group, I am particularly interested in hearing about your plans 
to successfully implement the new welfare-to-work programs so 
that we stay the course on welfare and not lapse into the old 
system.
    In your Department, $3 billion will be spent over the next 
2 years to provide grants for on-the-job training, job 
placement, job vouchers, and private sector wage subsidies. 
Most of these ideas have been tried many times before with very 
little success, as you well know. I would like to hear what you 
propose to do differently to make them work this time. I agree 
that the key is not only finding jobs, but in keeping them. I 
am very much aware that transportation and child care are two 
of the biggest obstacles facing workers today, and new workers 
entering from possibly a welfare role.
    But more and more jobs require basic skills in computer 
knowledge and training. This is one of the reasons that I have 
championed the community college tax credit last year. 
Community colleges and I have worked with them over the years 
and running the North Carolina Commerce Department, have been 
the best job training program we have ever had in the Nation, 
much more successful than Federal job training programs. 
Welfare caseloads are dropping, 30 percent in North Carolina 
alone, but I understand that your Department is seeing an 
increase in the number of people on welfare 3 years or longer, 
and an increase in those who have been on welfare before and 
are returning.
    I would be very much interested in your response when we 
get back to the question part of it, and I again thank you for 
being here.
    Secretary Herman. Thank you very much, Senator Faircloth.

                Employee Retirement Income Security Act

    Senator Specter. Thank you very much, Senator Faircloth. 
Madam Secretary, there has been a lot of concern about the 
question of responsibility of HMO's for precluding ill people 
from getting certain specialist care because of their 
evaluation that the care was not needed. President Clinton 
recently made a reference to a specific case in speaking before 
the American Medical Association last week about a 12-year-old 
boy stricken by cancer who had his leg amputated after his 
managed care insurer balked at paying for the alternative 
treatment that might have saved the limb. Under 1974 Federal 
legislation, the young man and his parents were barred from 
suing the health plan for damages and have no case against the 
doctor because he urged the leg saving procedure.
    You are a member of the President's commission which is 
looking into the need for legislation to protect patients' 
rights under managed health care plans. This may be a little 
too early for you to make an assessment, this is a big 
question. I want to give you fair warning, because it is a very 
big question----
    Secretary Herman. It is a big issue.
    Senator Specter [continuing]. To impose liability on the 
HMO's, changing the Employee Retirement Income Security Act. It 
is a very unusual provision of Federal legislation to preclude 
a State cause of action, but that is where we are. Would you 
care to make a comment?
    Secretary Herman. We spent a great deal of time, Senator, 
examining this issue as a part of the work of our commission, 
and I believe that while there was general agreement and 
recognition that we have to do something to provide greater 
protection for patients, for citizens, in this area, since 
ERISA plans are not subject to remedies under State laws and, 
therefore, citizens do not have the right to sue, if you will, 
under State law because of ERISA preemption. Exactly what is 
the appropriate response is an issue that the commission itself 
did not reach a conclusion on. What it did say in its 
recommendations to the President was that we needed to have a 
national dialog on this issue, that it was important to begin 
this debate in earnest, that we had to have a balanced approach 
that took into account not only a patient's legitimate right 
for redress but the obvious employer concerns of the costs that 
would be attendant to expanding ERISA as one option, or just a 
whole question of what you do to impose remedies in this area.

                        cost of expanding ERISA

    I know that this is also something that the Congressional 
Budget Office is looking at in terms of scoring, as a part of 
our own recommendations to the President. They have not yet 
come back with whether or not increased remedies would 
necessarily be a burdensome cost to plans, and I know that we 
are all waiting to get a better handle on that cost data. But 
there have been other studies that have been done, and I see 
the red light is on, there have been other studies that have 
been done that do suggest that strengthening remedies in this 
area does not necessarily suggest that it would result in 
increased costs to plans, but we have not reached a formal 
recommendation in this area yet.
    Senator Specter. That is a splendid answer which would win 
you plaudits from any diplomatic post in the world.
    Secretary Herman. Thank you, Senator.
    Senator Specter. But what do you think?
    Secretary Herman. I think, speaking for the Department of 
Labor, that we have to have strengthened remedies in this area.
    Senator Specter. We have to have what?
    Secretary Herman. Strengthened remedies in this area. I 
think the loopholes that presently exist are loopholes that 
have to be closed in some way. I am not prepared, of course, to 
say exactly what is the best way to do that, but I do think 
that when you look at the loopholes that are there, that we 
have to have increased remedies in this area.
    Senator Specter. Well, it is going to be expensive beyond 
any question. I think there is no doubt about that. But the 
question is what is fair here? What this subcommittee is going 
to do, we are going to convene a hearing on this subject alone. 
This has received a lot of attention and a lot of notoriety. In 
my open house town meetings I hear the question all the time 
about the gag rule about capitation, and there is no doubt 
about the increase in cost. As the increase in costs go up, we 
also know the people lose their health benefits. So there is a 
tradeoff here, but I think it requires some greater analysis. I 
also think that if there were a little sharper focus in public 
attention, that there would be a little more care exercised by 
the HMO's in denying the extra care.
    This is an area where I think the President's bully pulpit, 
the Secretary's bully pulpit, you have a powerful bully pulpit, 
Madam Secretary, and so does Senator Faircloth, so we may just 
have to call some of that into action.
    Secretary Herman. I certainly would agree with you, 
Senator, and I would look forward to any efforts on the part of 
your work here to give greater attention to this issue because 
I think the more we can focus public attention and public 
debate on it, you are right, it does also build in I think more 
responsible actions.
    Senator Specter. We are going to submit quite a number of 
questions on this for the record. I will give Senator Faircloth 
the last word.
    Senator  Faircloth. I did not understand in your second 
answer to Senator Specter that you are going to have to have 
stricter what?
    Secretary Herman. He asked me what did I think personally, 
and I was making the statement on the part of the Department of 
Labor and not speaking broadly for the administration, because 
the President has not taken a position on this issue, but I 
said I thought we needed to have increased remedies, 
strengthened remedies in this area, but I was not prepared to 
say what those remedies, what form those remedies would take.

                  North Carolina formula grant waiver

    Senator  Faircloth. One question that pertains to my home 
State. I will ask that, and then I will be through. My State, 
North Carolina, submitted their plan recently, and in it we 
asked you to grant a waiver to allow us to administer our 
formula grant through our local job service employer committees 
rather than through the work force development boards. North 
Carolina is not trying to exclude work force development 
boards. We have been directed by State law passed by General 
Assembly to use our local employers, the job service employer 
committees. Do you have the authority to grant this waiver?
    Secretary Herman. Presently, Senator, I am very much aware 
of what has just happened in the State of North Carolina with 
regard to the actions that the State legislature took there. We 
are presently in consultation with the individuals in the State 
now, trying to determine exactly what is possible in terms of 
what has happened in North Carolina. This is the first time 
that this has happened. We have had 16 States that have come 
before us that we have approved their plans for formula grants. 
The legislation does require that the States work through the 
work force development boards. We have not had, quite frankly, 
a situation like this occur, and I must admit that I am not in 
a position at this point to answer the question directly 
because we are just beginning that consultation with the State 
now.
    Senator  Faircloth. Well, I was hoping you did have the 
authority to grant the waiver, and I think North Carolina 
should have the flexibility to set up a program that puts 
welfare recipients into jobs, and it not get hung up in the 
inevitable hang ups we can produce here in Washington, as you 
are well familiar with. If the law is not clear, then I would 
like to look at maybe offering a rider to the budget bill or 
somewhere to make it clear, because this is authority you 
should have. If you would please, in just the next few days, by 
the first of the week at least, if you or someone in your 
office would give me a call and tell me where we stand on this.
    Secretary Herman. I would be happy to get back with you on 
it, Senator, or have someone on our staff be in touch with your 
office.
    Senator  Faircloth. If you could this week, because they 
are pushing me on it in the State. Thank you so much.

                          NLRB budget request

    Senator Specter. Madam Secretary, one final question. Last 
year Congress froze funding for the NLRB which was nearly $12 
billion below the agency's request. Now this year the NLRB is 
the subject of a request for nearly a $10 million increase. 
From your perspective as Secretary of Labor, please give me 
your assessment of the workload and budgetary needs of the 
NLRB. Do you really need that increase?
    Secretary Herman. Well, Senator, as you know, the 
Department of Labor does not have direct responsibility for the 
NLRB, but I do know that the administration has put in a 
request of $9 million or $10 million, or a 5-percent increase 
in funding, due to the tremendous backlog of cases that the 
NLRB is experiencing. It was precisely because the budget of 
the NLRB was frozen in 1997, staff were laid off, that this 
backlog has now resulted. So, yes, I do believe that additional 
resources to the NLRB would certainly help with the tremendous 
administrative problems they are having right now in managing 
that backlog.

                     Additional committee questions

    Senator Specter. Madam Secretary, in addition to the 
questions we have asked for the record, would you provide the 
subcommittee with the details on backlog and the necessity as 
you see it for this increase? We would like to have some back 
up verification of that request.
    Secretary Herman. Yes, Senator, we would be glad to do 
that.
    [The information follows:]
        National Labor Relations Board--Fiscal Year 1999 Funding
                   president's request: $184,451,000
Background: Limited funding and reduced staffing have led to growing 
        backlogs
    Funding has not kept pace with inflation: The current funding 
level, adjusted for inflation, is 8.7 percent below the 1995 level and 
10.6 below the 1993 level; The requested amount, adjusted for 
inflation, would still be 7 percent below the 1993 level; and Current 
funding has imposed stringent limitations on Agency activities (see 
below).
Agency staffing has been reduced to meet funding limitations
    By more than one-third since 1980--from about 2,950 to 1,900 
projected this year.
    By more than 15 percent since 1990 and more than 30 percent since 
1984.
    Field professional staffing has been reduced by 6 percent since 
1990, managerial staffing by 13 percent, and clerical staffing by 20 
percent.
    The staffing level (FTE) for fiscal 1996 and 1997 were the lowest 
since 1962, yet the case intake was nearly 60 percent higher.
While intake has remained steady, workload has grown
    Because of reduced staffing, each employee must now handle 22 
percent more cases than in 1988 and almost 33 percent more than in 
1985.
    Cases have grown more complex due to corporate and workforce 
restructuring and other factors, increasing demands on resources. 
Information Officer program has also filtered frivolous charges, so 
that cases filed are more complex.
Despite efforts to prioritize and be more efficient, case backlogs are 
        growing
    Cases are piling up in the Regional Offices at the initial, 
investigative stage, where two thirds are dismissed or withdrawn:

Situations pending initial investigation in regional offices

September 30, 1988................................................ 2,891
September 30, 1993................................................ 3,858
December 31, 1997................................................. 7,151

    Cases are taking longer to investigate:

Overage cases (more than 45 days) pending initial investigation

                                                                 Percent
September 30, 1988................................................   3.8
September 30, 1995................................................  21.2

    In 1996, to cope with rising backlogs, a new case prioritization 
program was implemented (see page on ``Impact Analysis'' below). Time 
targets were extended for lower priority cases. But even under new time 
targets, as of December 1997, 27.4 percent of all cases were overage at 
the investigative stage. Of the highest priority cases (14 percent of 
all cases), 17.4 percent were overage (pending more than 7 weeks).
    Delay in court enforcement of Board decisions has increased because 
of a shortage of attorneys to handle the cases.
    Issuance of complaints, review of Regional Director dismissals of 
unfair labor practice charges, and computation and collection of 
backpay are taking longer.
    Agency has taken extensive steps to operate more efficiently (see 
below). Without these, backlogs would be even greater.
Funding at the administration requested level would reduce backlogs, 
        promote efficiency
    Steady growth in backlogs would be halted.
    Backlogs would begin to be reduced by up to 10 percent or more.
    Hiring of more field staff, so that cases could be investigated 
quicker, yielding faster complaints, settlements, and dismissals.
    More consistency in ability to hold timely elections and promptly 
certify results.
    Improved quality of case handling from enhanced training in 
investigation and litigation.
    The NLRB promotes stable and productive labor relations. It is most 
effective when it can resolve disputes quickly. Budget reductions have 
led to growing case backlogs. Efficiency measures have slowed the 
growth of backlogs, but adequate funding is necessary to provide 
effective service and to invest in further improvements.
Actions taken to meet current funding freeze
    Hiring freeze (Agency expects to lose 80 or more staff through 
attrition this year); Planned cancellation of all trials in September; 
Elimination of all training; Travel for elections, trials and other 
case handling drastically cut; Computer and other equipment 
acquisitions sharply reduced; and Automation program stretched out 
beyond 2000.
``Impact analysis'' program to maximize benefit of available resources
    Impact Analysis was implemented in 1996 to cope with rising 
inventory of uninvestigated cases, to ensure that more prompt attention 
and staff resources go to the cases with greater public impact.
    Under Impact Analysis, cases are classified at initial intake to 
determine time frame for investigation and resources to be applied. 
Previous system was essentially first-in, first-out.
    Cases receiving highest priority involve alleged unlawful activity 
having a demonstrable impact on the general public through disruptions 
of business activities, or significant impact on many employees.
    Cases are recategorized if necessary as investigation proceeds.
    Time targets for completion of investigative stage (previously 45 
days for all cases):

        Category                                                   Weeks
III...............................................................     7
II................................................................    11
I.................................................................    15
              nlrb automation program for fiscal year 1999
    Program is behind schedule due to funding limitations in fiscal 
year 1998; automation budget was scaled back from $11 million to $5 
million.
    On-time completion of system requires investment of $6.9 million in 
fiscal year 1999 to pay for:
  --Upgrading of desktop PC's capable of running new software;
  --Fileservers for database storage in headquarters and field offices 
        Fileservers will also meet other data storage needs;
  --Installation in field and headquarters offices;
  --Continued development of software necessary to implement the 
        system; and
  --Complete implementation of Year-2000 modifications.
    In addition to addressing the Year-2000 problem, new system will 
improve accuracy and availability of information for reports to 
Congress, public inquiries, GPRA compliance, FOIA compliance, internal 
management
    Failure to implement system as planned will necessitate increased 
costs in future years to solve Year-2000 problem
Steps taken since 1994 to restructure and streamline NLRB operations
    Reduction of rental space by closing/reconfiguring field offices. 
Since 1994 and especially during the 1996 space reduction initiative, 
we reduced space in 28 field locations, including the Division of 
Judges. We also closed the El Paso, Texas Resident office and moved the 
D.C. Resident Office into Headquarters. The 1998 planned reductions 
include 4 regional offices and Headquarters. Our end of year space 
assignment is expected to be 721,269 square feet--a more than 10 
percent reduction from the 1994 level of 801,991 square feet. This 
represents a rental savings of $2.25 million.
    Streamlining of supervision throughout the Regional Offices and in 
the Headquarters divisions to reduce layers of review, delegate 
decisionmaking to the lowest practicable level, utilize supervisory 
staff flexibly to perform direct casehandling; and increase the ratio 
of line employees to supervisors. Field office supervisory positions 
have been reduced from 155 in 1994 to 123 today.
    Significant increase in the identification and transfer of 
``portable'' work such as decision writing and telephonic 
investigations from a temporarily understaffed or backlogged region to 
one that can better handle the increased workload or to Headquarters. 
Savings come from moving work, not people.
    Streamlining oversight of Regional Offices by reducing the number 
of districts in the Division of Operations-Management at Headquarters 
by one-third, reducing the number of managers and increasing the 
managerial responsibility of each remaining district manager by 50 
percent in 1995.
    Eliminating administrative clearances and reviews. Delegation of 
additional casehandling and administrative authority to Regional 
Offices, eliminating requirements for clearance or approval from 
Washington.
    Reduction of investigative travel costs by asking parties who file 
ULP charges (charging parties) and are situated within a 120-mile 
radius of a field office to come to that office to provide their 
evidence; by increased use of affidavits taken by telephone and of 
questionnaires or requests for statements of facts; by clustering cases 
so that multiple cases can be handled on a single trip.
    Use of resident agents, working out of their homes in cities where 
there is no field office but where there is steady casehandling 
activity. Currently there are 3 resident agents, with one additional 
position posted and one more under consideration.
    Increasing the use of information technology (IT) to facilitate 
casehandling and management. In recent years, the Agency has made 
enormous strides in automation of all work processes. Computerized word 
processing and quantitative analysis and electronic communication have 
permeated the Agency's culture. Current projects include legal 
research, forms, case tracking, greater use of Internet technology.
    Streamlining of Office of Appeals by reducing layers of review, 
establishing time targets, and screening of cases. Case processing time 
reduced by more than half.
    Restructuring of compliance program by emphasizing more efficient 
methods of backpay computation and collection and improving 
coordination between Headquarters and Regional Offices.
    Reduction by 20 percent of FTE devoted to Board staff supervisory 
functions.
    Adoption of rules governing proceedings before ALJ's, designed to 
facilitate the expeditious resolution of unfair labor practice 
proceedings--including assigning judges to convene settlement 
conferences and permitting judges to dispense with full written briefs 
and to deliver ``bench decisions'' in some cases.
    Adoption of a ``Speed Team'' procedure to reduce amount of staff 
time devoted to cases where the Board is adopting recommended decisions 
of ALJ's.
  highlights of steps taken since 1994 to reform and prioritize-case 
                               processing
    Impact Analysis.--Implemented in 1996 to cope with rising inventory 
of uninvestigated cases, to ensure that more prompt attention and staff 
resources go to cases with greater public impact. Cases are now 
classified at initial intake to determine time frame for investigation 
and resources to be applied. Investigative approaches to cases can now 
be differentiated based on the categorization of the case. Previous 
system was essentially first-in, first-out.
    R case reinvention program.--There was an extensive examination of 
Regional Office practices to identify and resolve impediments to prompt 
union representation elections. All aspects of R-case processing were 
given higher priority. Particular attention is now paid to cases that 
take longer than average time to hold election. As a result, 
preelection issues are resolved sooner, whether by agreement or 
hearing/decision; time to holding elections has been reduced. Half of 
all elections are now held in 42 days compared to 50 days before 
reforms; 87 percent of elections are now held in 57 days compared to 75 
days before.
    10(j) Program.--The goal has been to promote uniform application of 
NLRA injunction provisions. A manual was produced and distributed to 
all field offices; training was conducted, with subsequent refresher 
sessions. Each Region named a 10(j) coordinator. Cases are now reviewed 
for 10(j) potential early in investigation.
    Compliance Program Reform.--Regional Office procedures for 
computing, collecting backpay and obtaining other remedies were 
extensively reviewed. The manual was updated and expanded. Regions may 
now use sampling, estimating techniques to simplify backpay 
computation. Compliance cases now prioritized under Impact Analysis 
principles.
                                 ______
                                 
                     Additional Committee Questions
              programs for women reentering the workforce
    Question. Secretary Herman, what are your plans to provide 
training, technical assistance and resources on displaced homemaker 
services to employment and training programs that deal specifically 
with women re-entering the workforce.
    Answer. The Department of Labor's Women's Bureau has a long history 
of helping women, especially displaced homemakers, re-enter the labor 
force. This was the case during my tenure as Director of the Women's 
Bureau and continues under the leadership of Acting Director, Ida 
Castro. For fiscal year 1997, the Women's Bureau provided a grant for 
the continuation of training and technical assistance services to 
approximately 1,300 programs that work to assist close to 400,000 
displaced homemakers re-enter the workforce. The Women's Bureau is 
continuing funding for this program in the current year and has 
requested $600,000 to continue the program in fiscal year 1999.
    Eligible displaced homemakers, welfare recipients and other low-
income women can access job training and related services under the Job 
Training Partnership Act (JTPA). About 40 percent of all participants 
in the JTPA Adult Training Program are welfare recipients. The 
Department of Labor's planning guidance for the JTPA program for 
economically disadvantaged adults identifies displaced homemakers as 
one target group whose needs should be addressed. To ensure that this 
occurs, the Employment and Training Administration (ETA) monitors JTPA 
State grantees each year. States and local communities have addressed 
the needs of displaced homemakers for many years. The Department also 
has funded a series of demonstration projects to explore ways to help 
displaced homemakers re-enter the labor market.
    Question. What actions will the Department take to help returning 
women workers enter occupations in the information technology field?
    Answer. The assistance the Department of Labor provides to job 
seekers, including women who are seeking new or better jobs, ensures 
that they have appropriate and relevant information about labor 
markets, job opportunities, and skill and other hiring requirements. 
The Department is responsible to make sure that the job training system 
it administers with State and local partners is responsive to the skill 
needs of the job market, including the information technology field.
    For example, the Department of Labor is helping States and local 
communities build One-Stop Career Center systems, and an integral part 
of One-Stop is the creation of America's Labor Market Information 
System (ALMIS). ALMIS is intended to help women and men exercise 
informed choice in their workforce decisions and to ensure that 
training is linked to occupations that are in demand in the communities 
in which they reside. Among its components are the America's Job Bank, 
which is the largest and most frequently visited job bank on the 
Internet, with 750,000 job openings posted daily; and America's Talent 
Bank, which allows registered employers to search a data-base of 
electronic resumes to find suitable candidates for their job openings. 
Many women will continue to benefit from these services. In addition, 
the Women's Bureau directly provides women returning to the labor force 
with information on occupations, projections, required education and 
training, and employment opportunities in the global economy.
    Job training programs are another avenue for providing American 
women with the skills they need for good jobs. The Women's Bureau will 
focus its Women in Apprenticeship and Non-Traditional Occupations Act 
(WANTO) technical assistance grants on community-based organizations 
that work with employers and labor unions in non-traditional 
industries, particularly computer-based industries in information 
technology and other computer-based manufacturing processes. 
Coordinated with the Bureau of Apprenticeship and Training, the effort 
will focus on women who are former welfare recipients who live in 
empowerment zones and enterprise communities and their employers. The 
Women's Bureau also plans to look for information technology and 
related employers and labor unions who want to work with community-
based organizations that will deliver technical assistance services.
    In addition, Congress is currently considering legislation that 
would streamline and consolidate the web of job training programs and 
better prepare the American workforce for the 21st century. This 
legislation reflects key principles proposed by the President in his 
G.I. Bill for America's Workers. This job training reform will empower 
women with resources and information, helping those who seek training 
or retraining with control over their own careers. This empowerment 
will make the job training system more responsive to the skill needs of 
the market, including the information technology field.
    Finally, the Department also recently issued a solicitation for 
training individuals in high technology fields. We anticipate that a 
large number of women will benefit from job training under these 
grants.
                              minimum wage
    Question. The President's budget proposes raising the Federal 
minimum wage, which now stands at $5.15 per hour, to $6.15 over the 
next two years. Would you expect this higher minimum wage to apply to 
welfare recipients engaged in work under the new welfare law.
    Answer. The minimum wage and other provisions of the Fair Labor 
Standards Act (FLSA) apply to working welfare recipients just as they 
apply to all other workers. If welfare recipients are employees under 
the FLSA's broad definition, and their job is covered by the FLSA, they 
must be paid the Federal minimum wage.
    Question. Do you expect the minimum wage requirement to act as a 
deterrent to employers' willingness to hire welfare recipients?
    Answer. As people move from welfare to work, one of the most 
important lessons they can learn is that work pays. Raising the minimum 
wage is a signal that the nation should reward--and not hold back--
people who try their best to work hard and play by the rules. Welfare 
recipients should not be excepted from that deal.
    New block grant rules and declining caseloads have resulted in many 
States having more flexible resources and additional funds available 
per welfare household this fiscal year. A report by a House Ways and 
Means subcommittee shows that last year the typical State received a 56 
percent increase in available funding per recipient family over 1994 
levels. In addition, States may use their State-only welfare funds to 
serve a variety of needs and special populations. States have 
substantial available resources.
    The President proposed and won passage of the Welfare-to-Work Jobs 
Challenge which will make $3 billion available over the fiscal years 
1998 and 1999 to States and localities for the purpose of helping the 
hardest-to-serve recipients secure lasting, unsubsidized employment. 
The President also proposed and won passage of a ``super'' Work 
Opportunity Tax Credit (WOTC) for long-term recipients. Employers could 
receive a credit equal to 35 percent of the first $10,000 in wages in 
the first year and 50 percent of the first $10,000 of second year 
wages, making for a maximum credit to private sector employers of 
$8,500 as opposed to $2,400 under the regular WOTC.
    In light of these additional resources and incentives to employ 
welfare recipients, it will be difficult to argue that a modest 
increase in the minimum wage would act as a deterrent to employer's 
willingness to hire welfare recipients.
                             job stability
    Question. A recent research study found that from half to two-
thirds of the welfare recipients who leave welfare to work lose their 
first job within a year. Sixty percent of the job losses were initiated 
by the employees, in response to problems either on the job or at home.
    What have you learned about problems facing these former welfare 
recipients that need to be addressed to promote job retention?
    Answer. Krista Olson and LaDonna Pavetti of the Urban Institute 
estimate that almost 90 percent of welfare recipients between the ages 
of 27 and 35 experience at least one of five major potential barriers 
to employment--low basic skills, substance abuse, a physical health 
limitation, clinical depression, or a child with a chronic health 
problem. They estimate that almost half of welfare recipients 
experience a severe form of one of these barriers. Low basic skills is 
the most common of these barriers--about a third of welfare recipients 
score in the bottom decile of the women's distribution of the Air Force 
Qualifying Test (AFQT), and another third score in the 10th to 25th 
percentiles.
    About 10 percent of welfare recipients report having physical 
health problems that prevent them from seeking work; 22 percent report 
being depressed over 3 days a week; 5 percent report a serious drinking 
problem; 9 percent report heavy cocaine or crack use either currently 
or at some point in their life; and 21 percent have a child with a 
chronic medical condition. Of these various barriers, low basic skills 
appears to be a particularly strong barrier to employment--only 44 
percent of welfare recipients who score in the bottom decile of the 
AFQT report working at all in the current or previous year.
    Olson and Pavetti note that while welfare recipients with barriers 
to employment often work despite these barriers, these recipients 
seldom work for a full year. Of welfare recipients who worked despite 
having a serious barrier to employment, only 11 percent reported 
working the entire year. Olson and Pavetti suggest that a particularly 
at-risk group of welfare recipients are those that have a potentially 
serious barrier to employment and have no recent work experience. About 
a quarter of the welfare population fits this description. Further, 
because welfare recipients with serious barriers to employment seldom 
work throughout the year, Olson and Pavetti estimate that half of the 
welfare population will need fairly intensive levels of services if 
they are to fare well over the long-term.
    All of this suggests that it will be very difficult for a fair 
proportion of welfare recipients to maintain employment. Realistically, 
it will be extremely difficult for all welfare recipients to attain 
self-sufficiency, and perhaps the key issues as welfare reform plays 
itself out over the next few years are what proportion of welfare 
recipients may not be able to become self-sufficient and how States and 
the federal government deal with these persons and their children.
    To maximize the proportion of welfare recipients who maintain 
employment, there are four elements that can be built into welfare-to-
work programs. First, there probably needs to be strong case management 
component that provides follow-up services for at least two years. 
Butte County has perhaps the strongest results in the California GAIN 
evaluation, and its program has a strong emphasis on case management. 
Second, part-time jobs may be a good compromise for welfare recipients 
who cannot maintain a full-time job. Third, work experience in the non-
profit sector may also be appropriate for welfare recipients not ready 
for employment in the private for-profit sector. Finally, welfare-to-
work programs could include a health component to address physical, 
mental, and family health problems that are barriers to sustained 
employment.
                       update on welfare-to-work
    Question. Concerns have been raised that placing welfare recipients 
in jobs would hurt the working poor. What is your assessment of this 
problem?
    Answer. We do need to be sensitive to the effects of welfare reform 
on the low wage labor market, but it is likely that the low wage labor 
market will be able to absorb the numbers of welfare recipients 
entering it.
  --In addition, we anticipate that creative State and local efforts 
        (spurred by the broad flexibility of welfare-to-work (WTW) 
        grants and the additional resources they are expected to 
        leverage) will produce new and sustainable relationships (in 
        areas such as public housing, transportation, child care and 
        other support services) which will benefit the working poor as 
        well as welfare recipients. Many innovative welfare reform 
        efforts have already extended child care to the working poor to 
        reduce the high marginal tax rates on low income individuals 
        leaving welfare.
  --Both the Earned Income Tax Credit and transitional benefits such as 
        child care, health care and transportation assistance can ease 
        the difficult move into self-sufficiency. One of the 
        assumptions of transitional benefits is that earning progress 
        and job-related benefits will lessen the need for the 
        transitional benefits.
  --The Department of Labor will encourage service providers, employers 
        and other interested parties to avoid having low-wage American 
        workers displaced by those who are hired from the welfare 
        roles. Current low-wage workers need opportunities to acquire 
        the skills necessary to move up the career ladder and make room 
        at the entry level for job candidates who are on welfare.
  --Making this kind of room is the result of extensive job development 
        not only for entry level jobs but for jobs on the rungs just 
        above the working poor.
  --The Department and our State partners are taking steps to ensure 
        that the products under America's Labor Market Information 
        System (ALMIS) are available to welfare recipients and the 
        working poor. One-Stop Career Centers and employment service 
        offices have a strong network of contacts with employers 
        providing jobs in the initial third of the labor market.
    Question. The Department recently issued a solicitation for the 
competitive grant process. Could you explain how much money is 
available, who is eligible to apply, and what is the expected outcome 
from these grants?
    Answer. The amount of money for the competitive grants is 25 
percent of the total appropriation, after the set asides (for the 
Indian program, the Health and Human Services (HHS) evaluation, and, in 
fiscal year 1999, the performance bonuses to States) have been taken 
out. In fiscal year 1998, there is a total of $368.25 million, split 
between two separate solicitations. In fiscal year 1999, there will be 
approximately $343.25 million, split between two or more solicitations.
  --Eligible applicants include Private Industry Councils (PIC's), 
        political subdivisions (cities and counties), and private 
        entities, which can include community development corporations, 
        community-based and faith-based organizations, disability 
        community organizations, community action agencies, and public 
        and private colleges and universities. Private entities are 
        required to apply ``in conjunction with'' the PIC or political 
        subdivision. [Note: Public colleges are included as private 
        entities for the purposes of this program].
  --In addition to the general performance goals set forth for the 
        overall WTW program (the primary being placement of individuals 
        into unsubsidized jobs with good career potential for self-
        sufficiency) the expected outcomes of the competitive grants 
        are two-fold--
    --First, these grants are targeted to the special needs of local 
            communities. While WTW formula grant funds are distributed 
            according to a general formula applied across the country, 
            competitive grant funds are meant to address issues 
            specific to local areas, as described by the community in 
            its grant applications.
    --A second major goal particular to the competitive grants is 
            expansion of the knowledge base on effective welfare-to-
            work strategies. Innovation is an important factor in 
            evaluating competitive grant applications. Replication and 
            dissemination of best practices will be a critical activity 
            for the Department and its grantees.
Formula Grants
    In regard to WTW formula grants, the majority of States are very 
eager to begin implementation. As of March 18, twenty State plans had 
been received. The Department of Labor and Health and Human Services 
Regional Offices continue to work closely with States to provide 
assistance in developing their plans. Since States are at various 
stages of readiness, the Department will continue to accept formula 
grant plans until June 30, 1998.
    Most of the States who have not yet submitted plans will do so, 
once they are able to complete their State and local planning processes 
and establish the appropriate linkages and partnerships necessary.
    Question. I've also heard that not all States have submitted plans 
for the formula funds. Could you explain why some States have opted out 
of the program?
    Answer. To date, very few States have informed the Department that 
they will opt out of the WTW program in fiscal year 1998. These States 
are, for the most part, small Western States with relatively low 
welfare caseloads. They have told the Department that they feel they 
can effectively serve their welfare caseload with the funds available 
to them under the Temporary Assistance for Needy Families (TANF) 
program. These States have also indicated that they may be interested 
in participating in fiscal year 1999.
    Question. What impact has welfare reform and the welfare-to-work 
initiative had on the workforce development system? Are they working 
together or competing?
    Answer. DOL anticipates that welfare reform will put more pressure 
on States and local areas to use JTPA funds to serve higher proportions 
of welfare recipients relative to other JTPA target groups. However, it 
is still too early to pick up such changes in administrative data. It 
also is much too early to tell how the welfare-to-work initiative will 
affect the broader workforce development system. DOL expects that 
welfare-to-work efforts will complement rather than compete with the 
broader workforce development system because in many local areas the 
same agency will operate both the JTPA and the WTW programs. Currently, 
63 percent of low income adults and 57 percent of JTPA's welfare 
recipients who leave the program are employed three months later, 
although half of the welfare participants have little if any work 
experience at program entry.
    Although administrative structures and levels of integration vary 
across States, the workforce development system has been working hard 
to incorporate welfare reform into its services structure. The 
Interstate Conference of Employment Security Agencies (ICESA) recently 
conducted a survey that indicated that:
  --In almost two-thirds of States, Employment Security Offices have 
        agreements with welfare/social service agencies to provide 
        employment services to job ready welfare recipients.
  --At least three States have enacted major legislation to put 
        workforce development and welfare within the same agency.
  --Many other States indicated that they are planning to integrate 
        services through their One-Stop system, and the majority have 
        established Human Resource Investment Councils to integrate a 
        variety of workforce and welfare programs and services.
  --Given the emphasis at the Federal, State and local level directed 
        towards system integration, coupled with the flexibility 
        provided by WTW grants, we see the workforce development and 
        welfare infrastructures moving towards seamless service 
        provision versus client competition.
                       success of welfare-to-work
    Question. The new welfare law provides a total of $3 billion over 
the next three years to help transition public assistance recipients 
into self-sufficient wage earners. Is this funding, coupled with 
existing Job Training Partnership Act resources, going to be enough to 
reach the requirement that 50 percent of adult welfare recipients 
obtain jobs by the year 2000?
    Answer. The 50 percent requirement you refer to appears to be the 
``minimum participation rate'' of all TANF participants in work 
mandated in section 407 of the Act. The 50 percent participation is 
applicable in fiscal year 2002 and after. Minimum participation rates 
for fiscal year 2000 and fiscal year 2001 are 40 percent and 45 
percent, respectively. The $3 billion available for WTW in fiscal years 
1998 and 1999 are targeted at helping some of the hardest to employ 
TANF recipients successfully make the transition from welfare to work. 
These resources alone, or coupled only with JTPA resources, are not, 
nor were they intended to be, sufficient to achieve the 50 percent 
participation rate. Success in this area is dependent on a 
comprehensive strategy which utilizes WTW, JTPA, and TANF resources 
combined with TANF maintenance of effort resources, WTW matching funds, 
and other community resources to successfully move individuals from 
welfare to productive employment.
    Question. What happens after the year 2000, when the Welfare-to-
Work program terminates, but States are still required to transition 50 
percent of welfare recipients into jobs?
    Answer. Because WTW funds are available for expenditure for a three 
year period from the date provided to a State, the WTW program will 
continue to operate at some level in most States through fiscal year 
2001.
                           performance bonus
    Question. The welfare reform legislation sets aside $100 million in 
``bonuses'' to be distributed to States in fiscal year 2000 for 
successful performance. What criteria have been established on the 
basis for awarding performance bonuses?
    Answer. The Department has not yet finalized its performance bonus 
criteria but will do so before the August 1998 deadline. Performance 
bonus criteria will, as the statute and regulations require, be based 
primarily on the success of WTW programs in placing participants in 
unsubsidized employment, retention of participants in employment for at 
least 6 months, and participant earnings gains.
    Question. How do you intend to insure that States don't substitute 
federal welfare-to-work grant funds for activities that would otherwise 
have been supported with State and local funds?
    Answer. A number of provisions are included in the statute and WTW 
regulations which guard against such substitution of federal funds for 
already existing State and local program funding. First of all, the WTW 
program requires the expenditure of $1 in State or local funds on 
allowable WTW activities for each $2 in WTW grants funds received by a 
State. Second, the statute and WTW regulations limit the use of WTW 
funds to the provision of services which are not otherwise available in 
the community. Finally, the statute and WTW regulations prohibit the 
use of WTW grants funds or funds used as match for WTW grants funds as 
match for other federally-funded programs. The Department believes 
these safeguards are sufficient to guard against the substitution of 
WTW grants funds for pre-existing State and/or local program funding.
                               evaluation
    Question. Critical to successful implementation of a welfare-to-
work program is evaluation of what is effective, and making changes to 
improve performance. What efforts are being taken to make sure there is 
an effective monitoring and evaluation system for the Welfare-to-Work 
program?
    Answer. The Department will assign a Grant Officer's Technical 
Representative (GOTR) to be responsible for monitoring of and technical 
assistance to each WTW formula and competitive grantee. Most of these 
GOTR's will be located in the regional offices. All GOTR's will be 
thoroughly trained in their responsibilities. In addition, the 
Department is developing programmatic and financial/administrative 
management review guides to aid GOTR's in monitoring WTW programs. 
Finally, the Department has worked closely with the Department of 
Health and Human Services (HHS) to develop a comprehensive approach to 
evaluating the effectiveness of the WTW program.
    Question. The degree of this program's success may also depend 
significantly on what you decide to measure as indicators of success. 
What emphasis do you plan to put on going beyond the simple measures of 
``persons served'' and ``placed in jobs'', to stress the quality of 
jobs, retention and employment, and increased earnings?
    Answer. The Department is committed to measuring the success of the 
WTW program based on outcomes rather than process. To that end, job 
retention, increased earning and other similar measures will be 
important factors in evaluating the program.
    Question. The welfare law places primary responsibility for 
performance data reporting with the Secretary of Health and Human 
Services. What impact has the Labor Department had on developing data 
to be collected from States?
    Answer. The Department is working closely with HHS and OMB to 
develop the data collection/reporting strategy for the WTW program.
    Question. What data collection issues remain to be resolved?
    Answer. Outstanding issues include agreeing on the precise data 
elements to be collected and how the data flow from the grantee to the 
federal level.
    Question. Madam Secretary, the Welfare reform legislation gave you 
responsibility to implement the $3 billion work program, but gave the 
Secretary of Health and Human Services responsibility for data 
collection and evaluation. Is this assignment of evaluation 
responsibility to HHS a concern to you?
    Answer. It is very rare for one agency to have responsibility for 
program operations while another agency is responsible for the 
evaluation of the program. I am confident, however, that the two 
Departments can work together on this.
    Question. What role does the Labor Department have, working with 
HHS, to monitor and evaluate the welfare-to-work effort?
    Answer. In addition to the longitudinal analysis planned by HHS in 
its national evaluation, HHS invited staff from DOL as well as other 
agencies affected by welfare reform such as Housing and Urban 
Development (HUD) to be part of the overall team designing the welfare-
to-work evaluation. DOL's Assistant Secretary for Employment and 
Training met with HHS Policy and Evaluation administrators on the 
design of the evaluation. DOL's Assistant Secretary and staff also have 
worked closely with HHS in resolving evaluation issues with OMB. DOL 
included in its competitive Welfare to Work grant announcement bonus 
points for local sites willing to be part of the random assignment 
component of the HHS evaluation.
    Question. Will the evaluation system provide data on how many 
former welfare recipients achieve economic self-sufficiency?
    Answer. In addition to the longitudinal analysis planned by HHS in 
its national evaluation, HHS is providing competitive grants to a 
number of States to provide follow-up data on persons leaving the 
welfare rolls. This will include data both on persons who leave welfare 
on their own, and persons who reach welfare time limits. States will 
provide matching funds for such grants and will design their own 
follow-up data collection.
                           america's job bank
    Question. I have heard such great reports about the success of 
America's Job Bank, an Internet site that allows the public to look at 
what jobs are available throughout the country. How are you building on 
this success to meet the growing demand for this type of information?
    Answer. America's Job Bank (AJB) has been achieving solid month to 
month gains in job seeker and employer usage. The Department projects 
that approximately 55 million accesses to the AJB website will be 
recorded in March 1998, easily eclipsing the previous monthly high. 
With daily access to over 750,000 jobs, the AJB ranks as the largest 
Internet job bank in the world. Increasing numbers of firms are placing 
job orders on the service, with growth rates between 10 percent and 30 
percent registered each month in the number of listed job vacancies. 
Some large employers, including IBM and NationsBank, have begun placing 
all of their job openings on AJB.
    A long-standing Federal-State partnership recognizes the tremendous 
potential of the Internet to improve the functioning of the nation's 
labor markets. Working closely with the State Employment Security 
Agencies, the Department has developed America's Talent Bank (ATB) 
under the One-Stop initiative. Through the Internet, job seekers can 
post their resumes from One-Stops and other publicly-funded 
institutions (community colleges, public libraries) or from home. In 
April 1998, a new version of AJB will integrate the ATB. Under this 
combined system it will be easier for job seekers to apply for 
employment.
    Two other initiatives also should be mentioned. Customers who 
desire information on the operation of local, State, regional and 
national labor markets can access America's Career Information Network 
(www.acinet.org). The Department is also beginning the development of 
America's Learning Exchange (ALX), which should help support the 
investment in new skills the nation will need in the next century.
                       learning anytime, anywhere
    Question. Explain the Administration's ``Learning Anytime, 
Anywhere'' initiative. I know that ED has the lead, but what is DOL's 
component?
    Answer. The Administration's Learning Anytime, Anywhere initiative 
emphasizes the use of new technologies to improve postsecondary 
learning by increasing access to education and training, and improving 
program quality. This initiative will make it easier for Americans who 
live in remote rural areas, and have a disability, or cannot take 
advantage of traditional learning because of competing family and work 
demands to access quality learning ``anytime, anywhere.'' This 
initiative requests funding for both the Department of Labor ($10 
million in fiscal year 1999) and the Department of Education ($30 
million in fiscal year 1999).
    The overall leadership for this initiative is coming from the 
National Economic Council and the Office of Science and Technology 
Policy. The initiative has the following broad objectives:
  --To enable adult learners to find information easily on the skills 
        they need to advance in or change careers, and compete for 
        higher-wage jobs.
  --To expand opportunities for lifelong learning for all adults by 
        creating pathways for them to tap into learning on demand 
        delivered by a variety of institutions using new technologies 
        such as the Internet, CD-ROM, interactive TV, and satellite.
  --To advance the use of technology through the use of existing 
        grants, loans, and tax credits in the learning on demand 
        environment.
    Under the Department of Education's (ED) proposed Learning Anytime, 
Anywhere Partnerships, ED will offer competitive grants to foster the 
development of high quality learning content where new learning 
technologies are used as a means for delivery. In addition, ED has 
proposed in its Higher Education Act authorization to broaden 
opportunities for distance learners by expanding institutional and 
student aid eligibility, eliminating the different treatments in cost 
of attendance between distance learners and on-campus learners, while 
ensuring quality through accreditation.
    The Department of Labor's (DOL) primary responsibility under the 
Learning Anytime, Anywhere initiative is to develop an Internet-based 
component of America's Labor Market Information System (ALMIS) that 
would serve the same ``public broker'' function for the training market 
that America's Job Bank (AJB) and America's Talent Bank (ATB) currently 
offer for the labor market. This new service, known as America's 
Learning Exchange, or ALX, would fulfill two primary functions: (1) to 
serve as a public conduit for information about, and access to, 
education and training resources, and (2) to foster the emergence of a 
coherent, efficient electronic marketplace for these resources. ALX has 
five primary customers: individuals, employers, education and training 
providers, education and training developers, and workforce development 
professionals.
    Secondarily, the DOL is also working with the Department of Defense 
to advance their Advanced Distributed Learning initiative and to move 
new learning technologies, e.g., the Intelligent Tutors, developed in 
Defense laboratories into use by the public workforce development 
system.
    Several Federal Departments and agencies are involved in this 
initiative. The Department of Education is working to remove 
restrictions on Pell grants for use in a distance learning environment, 
and, if their budget request is approved, will offer challenge grants 
to foster the development of high quality learning content where new 
learning technologies are used as a means for delivery. The Department 
of Defense is pursuing a procurement strategy to foster a new training 
development environment, Advanced Distributed Learning, which is based 
on creating the capability to combine and recombine basic training 
building blocks, called learning objects, using metalanguage 
descriptors. The National Science Foundation, as part of their Advanced 
Technology Program, is offering challenge grants to develop new 
learning technologies.
    Question. How will this initiative be managed?
    Answer. The approach agreed upon to develop ALX, similar to that 
used successfully to develop other ALMIS products, was to form a 
consortium of States and other organizations which had aligned 
interests. Minnesota agreed to lead such a consortium, and it was 
formed at an initial meeting in the summer of 1997. It has met four 
times since then, and now includes representatives from 16 States, 2 
Job Training Partnership Act Service Delivery Areas, 5 nonprofit 
organizations, and 3 Federal agencies. Additional partners are being 
sought. The ALX Consortium is augmented by a core staff component: 2\1/
2\ full time Federal staff on detail from the National Occupational 
Information Coordinating Committee and 4\1/2\ full time contract staff 
paid for by Minnesota.
    The Consortium is organized into five operating committees: Design, 
Content, Taxonomy, Collaboration, and Marketing, each addressing a 
different substantive component of the initiative. To ensure effective 
management and coordination of the project, there is also a Planning 
Committee, composed of consortium core staff, the lead person for the 
Federal partner, the lead person for the State partner, and the Chairs 
of the five committees. Workplans have been developed for each of the 
five operating committees.
    The Consortium has also established a virtual workspace on the 
Internet (www.excelgovt.org). This space is being hosted by one of the 
Consortium's non-profit partners, the Council for Excellence in 
Government. In it, Consortium members can take part in ``threaded'' 
topical discussions, post documents for comment and input, and send or 
receive e-mail from any member or all members of the Consortium. 
Additionally, there are monthly working meetings of the full Consortium 
and weekly conference calls of the planning committee.
                      stigma of welfare recipients
    Question. I share your concern about the stigma that is often 
attached to welfare recipients. That is why Congress established tax 
incentives for employers to hire former recipients. Nevertheless, based 
on HHS data, a large portion of welfare recipients are over 40. Many 
former recipients may face other cultural biases such as age 
discrimination. How does the Department expect to monitor these cases?
    Answer. Both the WTW statute and the implementing regulations 
contain nondiscrimination protections for WTW participants. For 
example, all WTW participants are covered by Federal, State and local 
laws prohibiting discrimination including: The Age Discrimination Act 
of 1975; Section 504 of the Rehabilitation Act of 1973; The Americans 
with Disabilities Act of 1990; and, Title VI of the Civil Rights Act of 
1964. Complaints alleging discrimination in violation of any applicable 
Federal, State or local law will be processed in accordance with those 
laws and the implementing regulations. Questions or complaints alleging 
discrimination in violation of the laws enumerated above may be 
directed to the Civil Rights Center in the Department. In addition, the 
regular program monitoring of State and local operations, which will be 
conducted by our regional office staff, will be able to identify cases 
of discrimination.
                             school-to-work
    Question. Some parents and interested groups are concerned that 
school-to-work programs steer students away from college and tracks 
them into specific jobs. What evidence do you have to the contrary?
    Answer. School-to-Work (STW) is designed to enhance any student's 
education regardless of whether they're going to college or straight to 
the workplace. The STW initiative stresses academic achievement, 
preparation for college, and exposure to a wide variety of career 
options. It is designed to broaden opportunities for students. 
Internships help students understand the relevance of academic subjects 
and how to apply academic concepts at work and in everyday life. 
Mentors share knowledge, focus, and commitment to one's work while they 
provide extra adult support and encouragement to students. Local STW 
partnerships of parents, employers, community organizations, and 
educators work together on school improvement and enriching programs 
for out-of-school youth.
    Initial evidence from local communities suggests that schools that 
have adopted school-to-work principles have experienced increased 
attendance, reduced drop-out rates and increased college admission 
among students. STW learning experiences help students gain a realistic 
appreciation for what a ``day in the life'' of a career/occupation is 
really like, which aids in college planning and making better decisions 
about postsecondary education. Adria Steinberg writes in the March 25, 
Education Weekly, ``not surprisingly students in such [STW] programs 
often identify the internship, and their connection to adult mentors 
outside of school, as providing them with their most meaningful, and 
rigorous, learning experiences''.
    We can look to one of the first school-to-work initiatives, 
Boston's Pro-Tech program for early evidence. Sixty-nine percent of 
Boston's Pro-Tech class of 1995 went on to college as opposed to 51 
percent of students in Boston's public schools overall. In 
Philadelphia, the graduation rate (from high school) of STW students 
was 97.6 percent, compared to 85.8 percent of other students in the 
district. Good School-to-Work systems have become ``better college prep 
than college prep'' according to Robert Riordan of The Big Picture 
Company (a network of urban schools).
    Question. What steps is the School-to-Work Office taking to ensure 
parents that school-to-work programs won't preclude or discourage their 
children from going to college?
    Answer. Through technical assistance, grant monitoring, and public 
outreach, the National STW Office works closely with State and local 
grantees to ensure that the objectives of the Act are met. This 
includes making sure that partnerships designing State and local STW 
systems represent all appropriate parties including secondary and 
postsecondary educators, employers, parents, community leaders, 
students, and others who are concerned about the education and future 
of our youth. These partnerships are in place to develop and implement 
STW efforts that reflect local needs and community values.
    Question. The School-to-Work Opportunities Act aims to provide 
``seed money'' or ``venture capital'' to leverage funds from private 
and public resources to promote broad-based school reform. Are you 
concerned that federal funds are not leveraging sufficient non-federal 
funds to sustain school-to-work programs as federal support declines 
and ends?
    Answer. States have been strongly encouraged over the past four 
years to consider how existing federal, State and local funding can 
support School-to-Work once their five-year implementation grant ends 
and/or the School-to-Work Opportunities Act (STWO) sunsets. In the 
first year after the STWO Act became law, data from the first eight 
States (implementing STW) indicated that for every Federal dollar 
invested, $2 was leveraged from other public and private funds. These 
included new contributions, funds redirected from other programs, or 
in-kind contributions, such as staff or facilities. The next assessment 
on funds leveraged from public and private sources will be made in late 
Spring 1998, when data from the latest Progress Measures survey (the 
instrument used to collect this information) will be available. This 
survey is expected to include responses from the 37 States that have 
had implementation grant funding for at least one year.
    Nevertheless, the leveraging of sufficient non-STW funds to sustain 
a fledgling system is a significant challenge. Implementing STW is a 
complex task, and significant time and resources are required to create 
sustainable systems that support education reform, workforce 
development, and economic development. The Departments of Education and 
Labor will work closely with all States to support their efforts to 
develop strategies for sustaining their STW initiatives. Our most 
pressing priority now is to ensure sustainability in the eight States 
who are entering the last year of their implementation grant in 1998. 
We will keep the Congress apprised of these efforts.
               youth opportunity initiative and job corps
    Question. Madam Secretary, we understand one of your top priorities 
in the coming fiscal year is to create opportunities for out-of-school 
youth through the Opportunity Areas for Out-of-School Youth program. We 
know there is a tremendous need to address the training and employment 
needs of young people who are no longer part of the mainstream--and 
this Committee included $250 million in the Department's fiscal year 
1998 funding for this program, if it's authorized.
    Can you share with us how you see the Job Corps program working in 
concert with this initiative? What role does the Department see for Job 
Corps in the Opportunity Areas for Out-of-School Youth program?
    Answer. The Job Corps program and the new Opportunity Areas 
initiative will have an interactive relationship that will include 
several elements. First, Job Corps outreach/admissions counselors will 
conduct active recruitment in Opportunity Area program sites, making 
presentations to parents, guardians and potential participants and 
discussing the opportunities for training and post-program job 
placement through Job Corps. Second, Job Corps students who are unable 
to complete their Job Corps training and whose homes are in communities 
where an opportunity area program operates will be referred to that 
program. Third, non-residential Job Corps programs located in 
communities where opportunity area programs operate will offer 
enrollment opportunities for eligible youth, allowing them to live at 
home while participating in education and training.
                          job corps expansion
    Question. Madam Secretary, in fiscal year 1998 this Committee 
supported the appropriation of $4 million to begin the site selection 
process for the continued expansion of Job Corps. We are pleased to 
note that the Department acknowledged the Committee's request and has 
asked for an additional $33 million in fiscal year 1999 to continue 
this process and establish 5 new facilities. Madam Secretary, can you 
share with us the Department's long-term plans for the incremental 
expansion of Job Corps?
    Answer. Because Job Corps has a proven track record of 
effectiveness in serving this Nation's most at-risk youth, the 
Department hopes to continue to expand the program on an incremental 
basis over the next several years. We are not in a position to quote 
specific numbers at this time, but I can assure you that each year we 
will explore the feasibility of increasing Job Corps capacity and 
enrollment levels, while ensuring that the quality and effectiveness of 
the existing program is maintained.
                         worker protection laws
    Question. During last year's debate on the Welfare-to-Work 
initiative, there was a great deal of discussion about applying worker 
protection laws to the welfare-to-work program. How are States dealing 
with the reality that the Fair Labor Standards Act does apply to these 
jobs?
    Answer. States are successfully creating employment activities for 
welfare recipients, including work experience, that comply with 
provisions of FLSA.
    To this end, in May 1997, prior to the implementation of the WTW 
program, the Department provided guidance to the States concerning how 
the Fair Labor Standards Act (FLSA) applies to welfare recipients. 
Names of regional contacts from the Employment Standards Administration 
(ESA) were also provided to the States to answer questions and provide 
technical assistance.
    Question. What assistance is the Department providing to States to 
meet the requirements of the Fair Labor Standards Act as States move 
welfare clients into work experience?
    Answer. During the implementation of the WTW program, the 
Department increased its technical assistance efforts to States to 
assist them in developing WTW State formula plans which comply with the 
provisions of FLSA. In addition to the on-going guidance and assistance 
from regional contacts, the Employment and Training Administration 
(ETA) maintains a continuously updated Internet home page on WTW which 
includes answers to commonly asked questions such as ``How does FLSA 
apply to WTW participants?''. Regional WTW training sessions also were 
provided to State staff on the WTW regulations and program design and 
included presentations and materials from ESA staff concerning the 
applicability of FLSA. Following the training sessions, as States began 
developing their plans for the State formula grant program, ETA 
regional staff with the assistance of staff from ESA have worked 
successfully on a one-to-one basis with several States to create WTW 
program designs that assure compliance with FLSA.
              unemployment insurance integrity activities
    Question. You are asking for $91 million to strengthen the 
integrity of the Unemployment Insurance System, which you say will save 
well over $100 million in 1999 alone. What specifically would these 
funds be utilized for, and how did you arrive at your savings estimate?
    Answer. The fiscal year 1999 President's budget request for 
enhanced integrity activities includes additional funding for the 
following functions: Eligibility Review Program (ERP), Benefit Payment 
Control (BPC), Tax Field Audit, and detection of separation issues.
    The Department estimates that this investment will save trust fund 
dollars of about $120 million in fiscal year 1999, and about $160 
million annually in the outyears. The savings will accrue from 
additional investments in: detection and collection of benefit 
overpayments, ensuring proper eligibility for UI benefits at the 
beginning of a claim, work search review, and collection of taxes.
    Data show that attention to four integrity activities: tax field 
audits, eligibility reviews, benefit payment control, and separation 
issue detection, has eroded over time. The savings estimate was 
developed by examining each of the integrity activities and determining 
the amount of funds which could be retrieved or retained in the trust 
fund given the addition of resources to the activity.
    For example, according to available information a determination can 
be made as to the average reduction in benefit payments due to errors 
detected in an eligibility review. Knowing how many eligibility reviews 
a reviewer can make per year, the savings per additional reviewer was 
calculated. Given average salary rates and the total dollars available 
for eligibility reviews, the number of additional reviewers was 
computed and the result multiplied by the savings per reviewer to 
calculate the savings attributable to the additional ERP's. Similar 
calculations were made for each of the other categories and in all 
cases conservative assumptions were used.
    The $91 million figure was authorized in the Balanced Budget Act of 
1997. For the purpose of determining savings from each of the four 
integrity activities, the $91 million was allocated among the four 
categories in the proportion to the amounts allocated in the fiscal 
year 1997 base grant. Thus, the savings calculation is conservative 
since States will in fact be able to target their funds in activities 
with the biggest payoffs.
                  request for child labor initiatives
    Question. Your budget proposes $37 million for child labor 
initiatives, of which $27 million is for overseas activities. Shouldn't 
we be spending more to correct child labor problems here at home than 
in foreign countries?
    Answer. As background, the Administration's Child Labor initiative 
includes the following four components: (1) $30 million for 
international programs against child labor, including the increase of 
$27 million identified above; (2) $50 million for the Migrant Education 
Program; (3) $5 million for a JTPA Migrant Youth Job Training 
demonstration program; and (4) $4 million to increase enforcement of 
child labor laws in the agricultural sector.
    This Administration is dedicated to fighting abusive child labor 
wherever we find it, here at home as well as around the globe. In fact, 
this initiative is proof that we intend to step up our efforts here at 
home even as we are building upon and increasing existing efforts to 
eliminate abusive child labor worldwide. The President's child labor 
initiative comes to almost $90 million. Most of this budget, 
essentially two thirds of this request, is targeting at correcting 
child labor problems here at home.
    According to ILO estimates, there are 250 million children between 
the ages of 5 and 14 youth working world-wide, of whom at least 120 
million work full-time. Tens of millions of these children work under 
extremely exploitative conditions. The depth of this problem requires 
our increased level of support, and thus we hope to commit one third of 
our child labor initiative to helping the millions of children around 
the world being terribly abused in the workplace.
                         children's initiatives
    Question. You are requesting $9 million under the Job Training 
Partnership Act pilot and demonstration authority for a child labor 
initiative and an apprenticeship child care initiative. Please provide 
for the record a detailed description of how these initiatives would 
work, including the background justification for them.
    Answer. Following are descriptions of the two initiatives:
Child Labor Initiative
    In conjunction with the President's Child Labor initiative, the 
Department is requesting $5 million under the JTPA pilot and 
demonstration authority to foster new work and learning opportunities 
to help young migrant farm workers (ages 14-18) qualify for other job 
opportunities with career potential.
    The justification for this request is straightforward. Agricultural 
work stretches the limits of child labor standards by requiring long 
hours of stoop labor and exposure to hazardous chemicals. Because of 
the pressing economic needs of migrant families, their young people 
must often work in the fields rather than attend school, resulting in 
high drop out rates. As generations of families stay in agriculture, 
the future of its youth is bleak: continuing poverty, low educational 
achievement and inability to progress in an increasingly technical 
workplace.
    As a demonstration program, this initiative will allow us to test 
the efficacy of a combination of subsidized non-agricultural work 
experience and educational enrichment in expanding the horizons of 
migrant youth, breaking the generational cycle of migratory 
agricultural labor, and combating the violation of child labor 
statutes.
    The demonstration will be geared specifically to the special needs 
of farmworker youth. This will include an annual plan of action which 
will follow participants throughout the year. Through coordination and 
partnerships with schools and service providers across the country, 
participants will be provided with a planned sequence of work 
experience and educational enrichment opportunities as they follow 
their families through the migrant stream.
    The educational enrichment component of the demonstration will 
utilize the School to Work approach of contextual learning. This 
integrates mentoring, ``hands on'' learning, and credentialing as 
supplements to traditional classroom instruction. The subsidized non-
agricultural work experience component would focus on exposure to 
professional and technical careers (e.g., banking, teaching, health 
occupations, et. al.). This combination of educational enrichment and 
work experience would maintain the participants' contribution to family 
income and allow them to complete their requisite annual academic 
credits without the usual disruption that the migrant stream engenders.
    After project implementation and completion (18-24 months), we 
expect an evaluation of outcomes and impact on the economic future of 
farmworker youth.
Child Care Initiative
    On October 3, 1998, President Clinton hosted the White House 
Conference on Child Care to focus the nation's attention on the 
importance of addressing the need for safe, available, affordable 
quality child care. Also on October 3, Secretary Herman signed the 
Quality Child Care Targeting Agreement, which is designed to expand the 
utilization of the Registered Apprenticeship System by the child care 
industry.
    The initiative is designed to provide the child care industry with 
locally-owned collaborative partnerships to establish a structured, 
formalized credentialed educational system for child care providers by 
utilizing the National Apprenticeship System.
    Building on successful models will be one of the cornerstones of 
the initiative and to this end the Bureau of Apprenticeship's (BAT) 
West Virginia office has developed a very successful model for training 
Child Care Development Specialists. This child care apprenticeship 
statewide system incorporates training based on the 13 nationally 
recognized functional competencies of developmentally appropriate 
practices and experience. This and other models, like the Maine model, 
will be blended to meet the needs of those States that adopt the 
apprenticeship system of training for this occupation.
    To facilitate the initiative, BAT will convene 7 to 8 regional 
meetings during fiscal year 1998 to introduce the concept and foster 
partnerships needed for implementation on a national basis. Each 
meeting will be broadly inclusive. Participants will include child care 
experts, apprenticeship representatives, health and human services 
providers, educational specialists, and other interested parties.
    The major attributes of this initiative will begin in fiscal year 
1998 with the concentration of building an infrastructure and local 
ownership of the statewide system. BAT will provide guidance, 
leadership, and technical assistance to the process every step of the 
way and act in the capacity of liaison to foster collaboration among 
all parties involved.
    The fiscal year 1999 budget request includes $5 million for this 
initiative. $4 million will be utilized for seed grants in a variety of 
locations from urban to rural areas. With this request the Department 
can provide assistance to a minimum of 10 States during fiscal year 
1999. An additional $1 million in the Program Administration account 
will be used for 10 FTE to address the increased workload associated 
with building a sustainable child care infrastructure.
    By utilizing the apprenticeship strategy we have established a 
career path for child care providers that includes reduced turnover, 
increased wages, and potential educational opportunities.
    The Department of Labor has been approached by Chrysler, Ford, and 
General Motors (GM) to expand the BAT child care program to their 
employees. This would be a collaborative effort between the 
corporations and the United Auto Workers (UAW) union. Because the 
corporations already have existing apprenticeship programs established 
in other fields, they are comfortable with the model. They would like 
assistance from DOL in using the apprenticeship model to train 
providers in an effort to expand and enhance existing on-site child 
care centers. GM's initiative would include 20 States while Ford's and 
Chrysler's would include 10 States each. Regional meetings with the 
corporations and the UAW are tentatively scheduled for late April or 
May.
                         bls job vacancy survey
    Question. The Department's request includes what appears to be the 
development of a new economic indicator, the vacancy survey. Could you 
explain why this survey is needed and how it can be used and by whom, 
and when it will be available? How does this proposal relate to the job 
vacancy survey initiative incorporated in last year's House report, 
which was intended to pilot test the development of local information 
about job vacancies at the local level?
    Answer. Presently, there is no effective way for policy-makers to 
assess labor shortages in the United States. As a result, the existence 
of labor shortages can be inferred only indirectly using labor supply 
information, such as the unemployment rate. National data on job 
openings and labor turnover can serve as demand-side indicators of 
labor shortages. The availability of unfilled jobs is an important 
measure of the tightness of labor markets.
    Development of job openings and labor turnover data at the National 
level would greatly enhance policy makers' understanding of imbalances 
between the demand and supply of labor. Job openings and labor turnover 
statistics considered in conjunction with information on unemployment 
also would be helpful to analysts and policy makers interested in 
monitoring wage rates.
    High vacancy rates signal unmet demands for labor, just as high 
unemployment rates signal unused supplies of labor. Information on 
labor turnover would be of value, among other purposes, for diagnosing 
whether high or rising vacancy rates reflect increased difficulty in 
filling positions as opposed to increased hiring activity. Further, 
comparisons of the aggregate number of job openings to the number of 
unemployed persons can be expected to be useful in understanding 
increases or decreases in labor market mismatch. Estimates of the 
number of job openings by major industry group would enhance the 
diagnostic value of the vacancy information.
    The survey plans call for the first publication of an experimental 
series in late 2001.
    As we understand the pilot initiative undertaken by the Employment 
and Training Administration (ETA) based on last year's House report, it 
was intended to provide information on the number of vacancies by 
occupation at the local level for planning purposes.
    While the BLS initiative included in this year's budget request is 
not directly responsive to the House report, BLS sees these two efforts 
as complementary and is committed to working with ETA to insure 
comparability to the extent possible.
              status of welfare-to-work competitive grants
    Question. Of the $1.5 billion provided for the welfare-to-work 
program in fiscal year 1998, $368 million are for competitive grants 
awarded directly by DOL to localities and entities working with 
localities. A solicitation for the first round of grant awards was 
published in the Federal Register on December 30 and were due to DOL by 
March 10, 1998. Unlike the formula grants, which are to be administered 
at the local level by Job Training Partnership Act (JTPA) Private 
Industry Councils (PIC's), competitive grants may also be administered 
by cities, counties, other localities, and private entities. (While 
private entities are permitted to apply for welfare-to-work competitive 
grants, the requests for proposals states that profits are not an 
allowable use of grants.)
    How would you characterize the responses you received for the first 
round of bids for competitive grants in terms of: (1) the number of 
responses, and (2) the types of entities that responded (e.g., PIC's, 
cities, rural counties, private entities)?
    Answer. The Department received over 500 grants applications in 
response to the WTW competitive Solicitation for Grant Applications 
(SGA) that closed on March 10. Applications were received from almost 
every State in the country and from all of the types of organizations 
identified as eligible in the SGA, including PIC's, cities, counties, 
community-based, faith-based and other nonprofit organizations, private 
for-profit organizations, private employers, transportation and housing 
authorities, and private employers.
    Question. Were the PIC's that responded in States that also have or 
intend to apply for formula grants?
    Answer. Proposals were received from PIC's in States who have 
received or are planning to apply for formula grants, as well as in 
States that have opted out of the formula program in Program Year 1998.
    Beyond these general characteristics, there is no information 
available at present regarding the types of applicants who applied for 
funding in this round. At present, the Department is in the process of 
evaluating the applications. We expect this process to be completed by 
the end of April.
    Question. Why did DOL, in its request for grant proposals, prohibit 
``profits'' as an allowable use of funds when the law permits for-
profit entities to participate in the welfare-to-work competitive grant 
program?
    Answer. The Department views WTW competitive grants as an 
opportunity for private for-profit entities to collaborate with non-
profit organizations as well as public agencies to provide effective 
services for hard-to-employ welfare recipients. To a certain extent, 
competitive grant funds will subsidize the normal research and 
development activities of for-profit entities, enabling them to test 
experimental employment strategies at no cost to themselves. For-profit 
entities are welcome to use the knowledge and experience they gain in 
profit-making enterprises funded through other sources, but the 
Department feels it is reasonable to disallow the earning of profit on 
competitive grant funds.
    Question. How would you estimate the effect of this prohibition on 
the response rate of for-profit entities?
    Answer. During this first round of grant solicitation, the 
Department received some questions as to the disallowance of profits 
under competitive grants. We received no indication, however, that 
private for-profit entities chose not to apply as a result of the 
prohibition on profit. Since applications from private for-profit 
entities were received by the Department, we must assume that the 
impact of the prohibition was minimal.
    Question. What percent of responses were from for-profit entities?
    Answer. As indicated above, we have not yet performed an analysis 
of the types of applicants and grant applications received. We expect 
to be able to perform this analysis by the end of April.
                health and human services data reporting
    Question. Under the 1996 welfare reform law, States are required to 
report case-level information for families receiving assistance under 
the Temporary Assistance to Needy Families (TANF) program, including 
their characteristics and benefits and services they receive. The 
Balanced Budget Act, which added the welfare-to-work program to the new 
TANF program, also added some data elements to describe welfare-to-work 
services by TANF families served with welfare-to-work funds. These data 
are to be reported to the Department of Health and Human Services 
(HHS). However, the law requires HHS to consult with the Department of 
Labor in defining these data elements. This data report is separate and 
different from the data reporting system under the JTPA.
    Has HHS consulted with you concerning data collection for the 
welfare-to-work program? Please describe the nature of the 
consultation.
    Answer. The Department is working closely with HHS and OMB to 
develop the data collection/reporting strategy for the WTW program. 
Outstanding issues include agreeing on the precise data elements to be 
collected and how the data flow from the grantees to the federal level.
    Question. What type of coordination between the State agency 
administering the TANF program and the local PIC's is required to 
collect welfare-to-work data?
    Answer. Coordination between the PIC's, the State WTW administering 
entity and the State TANF administering entity will be required in 
order for the data to be reported to HHS. We do not expect the DOL/HHS 
reporting instructions will mandate a particular organizational 
structure within which this coordination must occur. States will have 
the flexibility to develop reporting systems that best meet State and 
local needs, within the statutory requirements.
    Question. Do you have any concerns about the ability of the States 
and the local PIC's to coordinate and collect these data?
    Answer. The Department does not have major concerns about the 
ability of the PIC's, other local entities, and the States to collect 
and report WTW data. The PIC's and most State WTW agencies have for 
many years worked closely together to administer and report on the JTPA 
program. We expect the system to draw on this experience to minimize 
WTW reporting problems.
    Question. When will you have and expect to make available data on 
welfare-to-work recipients?
    Answer. Only about 20 States have begun operating the WTW program 
by the end of the January-March quarter. Most of the activity in these 
States has involved program start-up. As a result, the Department does 
not expect significant financial or program data to be reported until 
the end of the April-June quarter. As reports are due 45 days after the 
end of a quarter, data will not be available until September or 
October, 1998.
                              outcome data
    Question. The interim welfare-to-work regulations permit, but do 
not require, PIC's to voluntarily submit information about welfare-to-
work recipients under the JTPA data reporting systems. This is outcome 
information at the time a recipient leaves the program. The voluntary 
submission would be in addition to information required under the TANF 
data reporting system, which is caseload information while a recipient 
is in the program. The interim regulations note that the DOL may 
require the submission of outcome information in the future.
    Why did DOL decide not to require PIC's to submit outcome 
information through the JTPA reporting system for welfare-to-work 
recipients?
    Answer. The interim final WTW regulations indicated that the 
Department would pursue modifications to the Standardized Program 
Information Report (SPIR) to permit PIC's to use this reporting system 
for internal management purposes. However, the SPIR, as a termination 
based reporting system, cannot be used in its current configuration as 
a vehicle to report the transaction-based information required for the 
WTW program. We are working closely with HHS and OMB to develop the 
optimal reporting system for WTW recipients.
    Question. Will DOL obtain outcome information on the program? If 
so, how?
    Answer. DOL will obtain outcome information from the participant 
data reporting system being developed jointly with HHS.
    Question. How useful will the voluntarily reported data be to DOL 
in determining how to improve the program since some PIC's will be 
reporting it while others will not?
    Answer. The Department is exploring modifications to SPIR to permit 
its use by PIC's for internal WTW management purposes. Data for program 
improvement and evaluation purposes will be reported through the 
official WTW reporting system.
    Question. How will the effectiveness of the program be evaluated?
    Answer. The evaluation of the welfare-to-work program will 
encompass extensive implementation reports covering both year one and 
year two administrative data on participant characteristics, services 
received, and wages at placement. The data will be generated through 
indicator surveys of all formula and competitive grantees and site 
visits to 35 programs. The evaluation will also include formal random 
assignment studies in eight to ten sites to determine the effectiveness 
of alternative types of employment and training services, and in-depth 
case studies of welfare-to-work programs in 13 to 15 sites.
    Question. What are the respective roles of HHS and DOL in 
evaluating the welfare-to-work program?
    Answer. Congress assigned the Department of Health and Human 
Services the responsibility for evaluating the Welfare-to-work program, 
in consultation with DOL and HUD. DOL staff have worked with HHS in 
designing the evaluation, and will continue to work with HHS through 
the implementation of the evaluation.
                             financial data
    Question. The interim final rule notes DOL will develop a form for 
financial reporting of welfare-to-work expenditures by States and 
localities. Welfare-to-work funds may be spent on work or work-related 
activities and supportive services.
    Has the Department developed a form for reporting welfare-to-work 
expenditures by States and localities? What categories of expenditures 
will be on the form? Will there be a breakout of expenditures for work 
and work-related activities versus supportive services?
    Answer. The Department has developed financial reporting 
instructions for both WTW formula and competitive grants, which will be 
issued shortly. The reporting instructions require expenditures for 
each allowable WTW activity (e.g. OJT, support services, post-
employment services, administration) to be reported separately.
                   welfare-to-work performance bonus
    Question. The welfare-to-work program includes a $100 million set-
aside from fiscal year 1999 funds for a performance bonus for States 
that achieve success in their welfare-to-work programs. The law 
requires the Secretary of Labor to consult with the Secretary of the 
Department of Health and Human Services, the National Governor's 
Association, and the American Public Welfare Association to develop a 
formula for awarding these bonuses. The formula must be developed by 
August, 1998.
    What consultations or activities has the Department undertaken 
toward the development of the formula for awarding welfare-to-work 
performance bonuses?
    Answer. The Department is currently meeting with Health and Human 
Services, the National Governor's Association, and the American Public 
Welfare Association to develop a fair and comprehensive performance 
bonus system. In addition, a workgroup will meet this spring, and will 
include stakeholders, as well as federal, State and local partners 
representing employment and training, and welfare agencies. This 
workgroup will assess various measurement options and give us vital 
feedback on how to best award performance bonuses. We expect the 
performance bonus system to be in place by the statutory deadline, 
August 1998.
               opportunity areas for out-of-school youth
    Question. The fiscal year 1998 appropriation included $250 million 
in advance funding for a new Opportunity Areas for Out-of-School Youth 
(OASY) initiative for fiscal year 1999. (October 1, 1998 through 
September 30, 1999). This funding is contingent upon enactment of 
authorizing legislation by July 1, 1998. The program would award grants 
to high poverty communities to provide training and other assistance to 
out-of-school youth for the purpose of raising their employment rate. 
The President is requesting $250 million in advance funding for Program 
Year (PY) 2000 (July 1, 2000 through June 30, 2001).
    In the DOL budget justification, you state that you are requesting 
an advance appropriation for OASY for PY 2000, so that it is consistent 
with JTPA programs (which are funded on a program rather than a fiscal 
year basis). However, funds from the current appropriation may be 
obligated only through September 30, 1999. Since PY 2000 starts July 1, 
2000, it appears that the program would not be funded for the 9 month 
period of October 1, 1999 through June 30, 2000. Please explain this 
apparent gap in funding.
    Answer. It is correct that we will experience a nine month gap in 
funding from October 1, 1999 through June 30, 2000. This switch to 
program year funding will make the funding consistent with the language 
contained in the pending workforce development legislation. As a result 
of this gap, we are planning on having the $250 million advance 
appropriation from fiscal year 1999 carry us for the entire first 21 
months (the fiscal year plus the nine month gap) of the program. Due to 
budget restraints, we did not request an additional nine months of 
transition funding.
    We expect to award the first round of multi-year grants (funded 
with the advance fiscal year 1999 appropriation) in March of 1999. The 
grant award documents will contain language clarifying that the second 
year of funding will not be available until July 1, 1999--giving the 
grantees a planning period of approximately 15 months.
    Question. If you anticipate that fiscal year 1999 funds would be 
used to cover the period October 1, 1999 through June 30, 2000 
(contingent on the provisions of authorizing legislation), then 
couldn't the program still be forward funded in the fiscal year 2000 
budget, which could cover the Program Year July 1, 2000 through June 
30, 2001?
    Answer. Yes, the Opportunity Areas for Out-of-School Youth 
Initiative could be funded out of the fiscal year 2000 budget since we 
are planning on the fiscal year 1999 advance to carry the activities 
through June 30, 2000. However, it is critically important that we 
assure continued funding for this initiative. Therefore, we would not 
want this initiative ``zeroed-out'' in the fiscal year 1999 budget.
    Question. If funds are needed for the period of October 1, 1999 
through June 30, 2000, then wouldn't your request need to be for only 
75 percent of the amount requested (i.e., $250 million)?
    Answer. We will be able to stretch the fiscal year 1999 advance 
appropriation of $250 million over the initial 21 months of the 
initiative since it often takes grantees several months to begin full 
implementation. The advance fiscal year 2000 appropriation of $250 
million is needed to finance activities from July 1, 2000 through June 
30, 2001. This represents the full amount needed to finance the program 
year's activities, and the amount needed every year thereafter.
             summer youth program and youth training grants
    Question. The budget proposal would retain language allowing 
service delivery areas to transfer 100 percent of the funds 
appropriated to either SYEP or Youth Training Grants between the two 
programs. This language has been in appropriation bills since fiscal 
year 1996.
    To what extent have service delivery areas taken advantage of the 
authority to transfer funds between SYEP and Youth Training Grants?
    Answer. Service Delivery Areas have fully utilized the authority to 
transfer funds in their youth programs. Our data show that in 1996, 
States transferred about $130 million from the Summer Youth Employment 
Program to the year-round Youth Training Program. In 1997, preliminary 
data indicates that approximately $102 million was similarly 
transferred from the summer program to the year-round program. Only a 
handful of States did not use the transfer flexibility. We expect 
States to continue to make significant transfers inasmuch as they have 
been doing so since the year-round program was reduced in 1995.
    Question. What kinds of improvements, if any, in the delivery of 
services to youth have you observed as a result of this authority?
    Answer. The 100 percent transfer authority between the summer and 
the year-round program enables local operators to customize and 
integrate their programs to better meet specific needs, i.e., target 
groups, length of program, and number of youth served. The Department 
also believes that flexible funding between the two programs enables 
the States and localities to sequence services over a longer period of 
time. This specifically meets the needs of those with substantial skill 
deficits.
                    job corps zero tolerance policy
    Question. In PY 1994 the Department instituted its ``Zero Tolerance 
Policy for Violence and Drugs''. According to the Department's Job 
Corps Annual Report for Fiscal Year 1996, the dropout rate in PY 1995 
increased to 38 percent from a fairly constant rate of about 31 percent 
in previous years as a consequence of full implementation of the 
policy. The Annual Report states that the dropout rate has leveled off 
at 34 percent in PY 1996 indicating a successful adjustment to the 
policy.
    What is a reasonable dropout rate and why?
    Answer. One must look at dropout rates in other programs to provide 
a context in assessing turnover rates in Job Corps. Data from the U.S. 
Department of Education's National Center for Education Statistics, 
published in 1992, showed a dropout rate for post-secondary, nine-month 
vocational certificate programs to be 49.5 percent. Further, in a 
report covering the 1992-93 school year, the Educational Testing 
Service indicates that one in four urban school districts experienced 
four year dropout rates of greater than 35 percent.
    Another way to look at the same issue is to review findings of an 
impact evaluation by Abt Associates on four Youth Conservation and 
Service Corps programs funded under Subtitle C of the 1990 National and 
Community Service Act. The study was published in August, 1996. These 
were programs that were intended to improve the educational and 
employment prospects of participants and enhance their personal 
development. They served a population similar to Job Corps. The Abt 
Study found that only 33.3 percent completed the program, whereas the 
Job Corps vocational completion rate for students entering vocational 
training was 61 percent in PY 1996.
    In these contexts, the Job Corps turnover rate compares well. It 
must also be kept in mind that nearly 80 percent of Job Corps students 
have already dropped out of the regular school system.
    Question. What steps are you taking, if any, to reduce the dropout 
rate?
    Answer. We understand that having some participants leave Job Corps 
within one or two months is a cost to the program and Job Corps must do 
what it can to minimize the extent to which it occurs. However, 
reducing the turnover rate is an extremely difficult challenge. The 
turnover rate has remained relatively constant in Job Corps since its 
inception. We have initiated many strategies in attempts to impact this 
particular area. These have included requiring applicants to sign 
letters of commitment, conducting behavior checks with the criminal 
justice system, identifying and addressing health issues, carefully 
assessing applicants' capabilities and aspirations to participate in 
Job Corps, assuring that child care needs are met, making sure that 
applicants understand Job Corps' policy of zero tolerance for drugs and 
violence, and thoroughly informing applicants about what to expect when 
they arrive at a Job Corps center. In May of this year we will be 
convening a conference with all outreach and admissions counselors to 
discuss these and other approaches to reducing the early dropout rate. 
Particular attention will be paid to strengthening the process of 
assessing an applicant's capabilities and aspirations, a primary 
concern identified in a recent GAO audit.
    With respect to center programs, we have developed and implemented 
an intergroup relations program to accommodate the diversity that 
exists on Job Corps centers. We are also implementing a new social 
skills training program to teach students how to deal with anger and 
conflict, dress properly, get along with one another and work together 
in a team setting. A recently-instituted refinement to our occupational 
exploration program is designed to better match students with available 
vocational training. Taken together, these address factors which can 
contribute to students leaving centers early.
    Question. One criticism of Job Corps has been that students do not 
always feel safe at Job Corps centers. Do you have any indication that 
as a result of the zero tolerance policy that students perceive Job 
Corps to be a safer environment?
    Answer. The Office of Job Corps is committed to ensuring that 
students perceive Job Corps centers as safe places. According to a 
recent student feedback survey, 89 percent of Job Corps students 
nationally perceive their centers to be safe.
    Question. What indication do you have, if any, that Job Corps has 
become a safer environment as a result of this policy?
    Answer. Anecdotal information indicates that center staff believe 
that Job Corps centers have become safer environments as a result of 
the zero tolerance policy.
               job corps training related job placements
    Question. According to the Department's Job Corps Annual Report for 
PY 1996, 62 percent of all students placed in employment found jobs 
that matched the training received in Job Corps. (In PY 1995, 53 
percent of students obtaining employment were placed in jobs matching 
their training.) In its October, 1997 report on Job Corps, the General 
Accounting Office (GAO) stated that the training-related placement 
measure is flawed, because placement contractors have a wide latitude 
in deciding whether a job placement is a job-training match. The GAO 
report also states that Labor is developing a new system to more 
accurately determine job-training matches.
    In light of the GAO criticism of the training-related placement 
measure, how would you assess the accuracy of your reported 62 percent 
training-related placement rate?
    Answer. With regard to job training match (JTM), we share some of 
the GAO's concerns about how job training matches are determined. 
References were made by GAO as to the wide latitude and possible 
matches under the current job training match process. While such 
matches are possible, there are no empirical data to suggest they occur 
to any significant degree. GAO's examples of possible egregious matches 
were hypothetical only. We remain confident in the reported JTM data.
    Question. What steps have you taken to more accurately determine 
job-training matches?
    Answer. In accomplishing the objective of strengthening the JTM 
process, we will work with available coding systems. In this regard, 
and as acknowledged by GAO, Job Corps is moving to a new system based 
on the Occupational Information Network (O*NET) system. This replaces 
the current system which relies on the Dictionary of Occupational 
Titles and encompasses more than 14,000 codes. The new O*NET system 
will be more accurate, and easier to maintain and monitor in terms of 
egregious matches. The job training match issue is one of the primary 
projects addressed by the National Vocational Operations Committee, 
which was established by Job Corps to improve the quality of vocational 
outcomes.
             government performance and results act [gpra]
    Question. How are the agency's annual performance goals linked to 
the agency's mission, strategic goals, and program activities in its 
budget request.
    Answer. DOL's work is organized around three strategic goals which 
are outlined in the fiscal year 1999 Performance Plan. These goals 
bridge the Department's many agencies and programs linking them to the 
DOL mission.
    Goal 1. A Prepared Workforce: Enhance opportunities for America's 
workforce.
    Goal 2. A Secure Workforce: Promote the Economic Security of 
Workers and Families.
    Goal 3. Quality Workplaces: Foster quality workplaces that are 
safe, healthy and fair.
    For each of the three strategic goals there are supporting outcome 
goals in the fiscal year 1999 Performance Plan that refine and further 
focus the strategic goals. For each outcome goal, there are supporting 
performance goals that set specific and measurable target levels of 
performance for DOL Agency programs for the fiscal year. Linkage to the 
budget is provided in the DOL Annual Performance Plan by cross 
referencing DOL budget activities to the Department's three strategic 
goals. Specific linkages between individual Agency goals and program 
activities are provided in the individual Agency Performance Plans.
    Question. Could you describe the process used to link your 
performance goals to your budget activities?
    Answer. Our current efforts focus on assuring the Department's 
Annual Performance Plan has a well defined program structure supported 
by performance goals that capture the core purpose of each program or 
activity. We will then work with OMB to propose to the Congress 
appropriate budget restructuring recommendations. While the current 
budget structure aligns closely with our performance plan goals in many 
program areas, some budget program activities may have to be 
restructured to achieve the necessary alignment of programs, 
performance measures, and resources.
    Question. What difficulties did you encounter and what lessons did 
you learn?
    Answer. We have made significant progress in this area but much 
remains to be done. As noted above, we view GPRA implementation as an 
iterative process. Our fiscal year 1999 Annual Performance Plan 
includes measures for key program activities in the DOL budget. Our 
experience shows that to develop good measures for all budget 
activities will take both time and resources to accomplish. We need to 
analyze programs for representative measures of core work, test the 
measures, and establish reporting systems to capture the data in a 
timely and accurate manner. While our fiscal year 1999 Annual 
Performance Plan includes a number of good measures, we need to 
systematically assess all our programs to identify good measures that 
are representative in terms of the effectiveness, efficiency and impact 
of the work being performed.
    Question. Does the agency's performance plan link performance 
measures to its budget?
    Answer. Yes, the DOL Annual Performance Plan cross references all 
DOL budget activities to the Strategic goals of the Department. 
Individual DOL Agency performance plans link Agency budget activities 
to Agency performance measures.
    Question. Does each account have performance measures?
    Answer. The WCF does not have performance measures, however, the 
activities which it funds (OASAM & CFO) have performance measures.
       performance plan structure vs. account activity structure
    Question. To what extent does your performance planning structure 
differ from the account and activity structure in your budget 
justification.
    Answer. The DOL program and financing (P&F) schedules include a 
hybrid of budget activities. Some DOL Agencies are closely aligned with 
their performance planning structure while others have a mixed 
alignment. In ETA, grants and program dollars are aligned to separate 
program based P&F schedules, and S&E dollars for staff in these 
programs are allocated on a functional basis in a separate P&F 
schedule. Similar variations exist in other DOL Agencies.
    Question. Do you propose any changes to your account structure for 
fiscal year 2000?
    Answer. At this time fiscal year 2000 considerations are premature. 
We will be assessing such changes with the development of the fiscal 
year 2000 budget.
    Question. Will you propose any changes to the program activities 
described under that account structure?
    Answer. As noted above, fiscal year 2000 considerations are 
premature. We will be assessing such changes with the development of 
the fiscal year 2000 budget.
                 establishment of performance measures
    Question. How were performance measures chosen?
    Answer. With the Department's three strategic goals in mind, 
Programs developed performance goals and measures appropriately 
supportive of the goals and generally focused on capturing: (1) the 
core purpose of the program (e.g., OSHA: reducing injuries/illnesses in 
high hazard industries); (2) implications of timeliness and accuracy 
for the program (BLS: produce and disseminate timely, accurate, and 
relevant economic information), and, (3) project-oriented goals to 
improve programs and service delivery (e.g., OASAM: One-hundred percent 
of mission systems will process Year 2000 dates correctly).
    Overall, we believe we have good measures in many programs, but we 
also have other programs which will require further study to establish 
measures of performance that are meaningful and cost-effective in terms 
of data collection, reporting, and analysis.
    Question. How did the agency balance the cost of data collection 
and verification with the need for reliable and valid performance data?
    Answer. Several areas in DOL, ETA for example, have comprehensive 
program data collection systems in place which are regularly audited by 
the DOL Inspector General. These data have proven reliable over time. 
We are now in the process of identifying baseline data needs to measure 
outcomes. In this process, we will weigh the relative cost and 
paperwork burden against the benefits of developing and implementing 
better performance measures.
    Question. Does your plan include performance measures for which 
reliable data are not likely to be available in time for your first 
performance report in March 2000?
    Answer. Given DOL projections for the implementation and refinement 
of data collection and reporting systems, we fully expect to report 
data which is reliable in the first DOL Annual Performance Report. A 
key exception, from a timeliness perspective, is the data reported 
under the Job Training Partnership Act (JTPA).
    The JTPA Program Year (PY) corresponding to fiscal year 1999 is 
July 1,1999-June 30, 2000. The performance data for PY 1999 will be 
available in December 2000, or 15 months after fiscal year 1999 ends 
(September 1999). Thus, for the DOL Annual Performance Report for 
fiscal year 1999, DOL will have reliable JTPA data that reflects PY 
1998 performance. This information will cover the period July 1, 1998 
through June 30, 1999, which includes nine months of fiscal year 1999.
    Question. What are the key performance goals from your fiscal year 
1999 Annual Performance Plan that you recommend this subcommittee use 
to track program results?
    Answer. The Department's Annual Performance Plan includes 43 
program performance goals and 8 measures of management effectiveness. 
These goals were selected from over 233 performance and management 
goals included in 15 DOL Agency Performance Plans. We believe that they 
are representative of the core aspects of DOL programs for fiscal year 
1999 and appropriate for tracking to assess DOL program results.
    Question. For each key annual goal, indicate whether you consider 
it to be an output measure (``how much'') or an outcome measure (``how 
well'').
    Answer. Of the 51 goals in the DOL Annual Performance Plan, 25 are 
outcome goals and 26 measure output.
          performance goals relationship to dol strategic plan
    Question. State the long-term (fiscal year 2003) general goal and 
objective from the agency Strategic Plan to which the annual goal is 
linked.
    Answer. Each of DOL's three strategic goals has supporting outcome 
goals which focus Departmental programs and activities on specific 
areas of emphasis encompassed by the broader strategic goal. Outcome 
goals for each DOL Strategic Goal are listed below.
    Strategic Goal: A Prepared Workforce: Enhance opportunities for 
America's workforce.--Increase Employment, Earnings and Assistance; 
Assist Youth in Making the Transition to Work; Provide Information and 
Tools About Work; Provide Information and Analysis on the U.S. Economy.
    Strategic Goal: Secure Workforce: Promote the economic security of 
workers and families.--Increase Compliance with Worker Protection Laws; 
Protect Worker Benefits; Provide Worker Retraining.
    Strategic Goal: Quality Workplaces.--Reduce Workplace Injuries, 
Illnesses and Fatalities; Foster Equal Opportunity Workplaces; Support 
A Greater Balance Between Work and Family; Reduce Exploitation of Child 
Labor and Address Core International Labor Standards Issues.
    Performance goals measuring program performance within the broader 
outcome goals areas are listed in Appendix D to the DOL fiscal year 
1999 Annual Performance Plan.
                      outcome and output measures
    Question. In developing your Annual Performance Plan, what efforts 
did your agency undertake to ensure that the goals in the plan include 
a significant number of outcome measures?
    Answer. Departmental guidance has consistently focused on achieving 
results. The Secretary of Labor has held two retreats with DOL's Senior 
Management Team which centered on Managing for Results. Top 
management's emphasis on measuring the results of our programs was 
heeded by DOL Agencies. Nearly 50 percent of the measures in the 
Department's fiscal year 1999 Annual Performance Plan are outcome 
measures.
    Question. Do you believe your program managers understand the 
difference between goals that measure workload (output) and goals that 
measure effectiveness (outcome)?
    Answer. The Secretary of Labor has held two retreats with DOL's 
Senior Management Team (a total of six days) that focused on the 
Department's Strategic Plan and its fiscal year 1999 Annual Performance 
Plan. During the retreats the both plans and the measures which 
comprise the plans were discussed. The Senior Management Team then 
formulated plans for informing all DOL employees on the plan's contents 
and for integrating performance requirements into the day to day 
activities of employees at all levels.
    Question. What are some examples of customer satisfaction measures 
that you intend to use? Please include examples of both internal and 
external customers?
    Answer. While our Departmental plan includes no measures of 
customer satisfaction, the 15 Agency plans include a number of such 
measures. Here are some examples:
    ETA/UI measure.--Meet or exceed the Secretary's standards for 
promptness in paying worker claims for UI and deciding appeals.
    PWBA measure.--Respond to all requests (from the public) for 
benefits plan documents, annual reports and other information 
maintained for pubic disclosure within an average of 10 working days.
    PWBA measure.--Provide timely assistance to participants and 
beneficiaries. Respond to 90 percent of written requests within 30 
days. Respond to 99 percent of telephone requests by c.o.b. the next 
business day.
    ESA measure.--Increase overall rating of satisfaction (``fair'' to 
``very good'') among workers seeking Wage and Hour division services to 
70 percent.
    ESA measure: Increase customer satisfaction with the OWCP's 
Longshore and Harbor Workers Program service by 4 percent over the 
baseline.
    OSHA measure.--Establish baseline and interim performance goals for 
strategic measure: 95 percent of stakeholders and partners rate their 
involvement in OSHA's stakeholder/partnership process as positive.
    OASAM Measure.--80 percent of DOL managers and employees evaluate 
(OASAM) services as meeting or exceeding expectations. (This is an 
internal DOL measure that assesses customer (employee) satisfaction 
with the personnel, financial, and other support services provided by 
the Office of the Assistant Secretary of Administration and 
Management.)
              measurable goals vs. fiscal year 1999 budget
    Question. How were the measurable goals of your fiscal year 1999 
Annual Performance Plan used to develop your fiscal year 1999 budget?
    Answer. Internal guidance to agencies in the budget formulation 
process required that requests for new budget initiatives be related to 
Departmental strategic goals and include a discussion of expected 
outcomes with proposed measures and projected cost.
    Question. If a proposed budget number is changed, up or down, by 
this committee will you be able to indicate to us the likely impact the 
change would have on the level of program performance and the 
achievement of various goals.
    Answer. As noted above, where there is a correlation, on a 
historical basis, of program performance data and funding, we are 
obviously better able to assess the impact of varying resource levels 
on program performance. Prediction of program performance with new 
measures, where the agency has had no experience with the data, would, 
of course, be tenuous.
    Question. Do you have the technological capability of measuring and 
reporting program performance throughout the year on a regular basis, 
so that the agency can be properly managed to achieve the desired 
results.
    Answer. DOL's capability to capture GPRA performance data and 
report it in a timely manner varies significantly among our programs. 
With a large number of new performance measures being tracked in fiscal 
year 1999, we are in the process of revising or updating existing 
systems to capture the necessary data, so it may be reported in a 
timely manner and used to manage.
    DOL has also requested $1.159 million for contractor assistance to 
develop and refine a set of program performance measures for use at the 
Department level. These performance measures would use data from the 
various programs to establish a set of performance indicators at a 
fairly high level of aggregation to measure effectiveness in the broad 
and diverse programs that support the Department's three broad 
strategic goals. The key will be to develop these indicators using 
advanced analytical techniques, statistical analysis and correlation. 
The funding would also support identification of any baseline data 
needs across the Department from which to establish more concrete 
measures of program effectiveness, and assure efficiency in data 
collections and information technology improvements.
    Question. If so who has access to the information--senior 
management only, or mid- and lower-level program managers too?
    Answer. The capability of our agencies to provide ready access to 
program performance data varies markedly. Programs are currently 
assessing their systems for reporting program performance data with a 
view toward upgrading or implementing new systems which will provide 
more timely collection and reporting of data to all levels of DOL 
management.
    Question. Are you able to gain access easily to various performance 
related data located throughout your various systems.
    Answer. Data from the states needs to be reported in a more timely 
manner. Another short fall in this area, as discussed in the previous 
question, focuses on new program performance data requirements 
generated by GPRA. DOL data reporting systems needs to be expanded to 
support this larger data collection effort.
                     account structure modification
    Question. The Government Performance and Results Act requires that 
your agency's Annual Performance Plan establish performance goals to 
define the level of performance to be achieved by each program activity 
set forth in your budget.
    Many agencies have indicated that their present budget account 
structure makes it difficult to link dollars to results in a clear and 
meaningful way. Have you faced such difficulty?
    Answer. Some DOL areas are closely aligned with their performance 
planning structure while others have a mixed alignment. Several DOL 
Agencies, for example, currently have budget decision units for 
overhead or staff based activities whose operations support multiple 
program performance measures. There may be cases where tying dollars to 
programs and program measures would be useful, and we may want to 
explore this and realign as necessary.
    Question. Would the linkages be clearer if your budget account 
structure were modified?
    Answer. Our current efforts focus on assuring the Department's 
Annual Performance Plan has a well defined program structure supported 
by performance goals that capture the core purpose of each program or 
activity. As noted above, we may want to explore realignment of the 
budget structure in terms of tying dollars to core programs and 
measures in certain areas.
    Question. If so, how would you propose to modify it and why do you 
believe such modification would be more useful both to your agency and 
to this committee than the present structure?
    Answer. The Department believes that our current appropriations 
structure, which has not been updated in many years, may not reflect 
the optimal display of resources which would permit better estimates of 
the total cost of our programs.
    When this structure--essentially budget activities--was first 
developed, its purpose was mainly to describe the types of programs and 
activities being funded. Although the Department always has been 
attentive to results in its programs, the GPRA provides an opportunity 
to re-examine how we budget to help us assess program impacts.
    In order to revise the current descriptive budget structure to a 
new presentation focused on results, it may be useful to realign the 
budget activity structure to reflect the program structure. The 
advantages would include a capability to assess the total program costs 
and the costs of achieving programmatic outcomes or results where these 
costs are a significant feature of the program.
    Another goal of restructuring would be to reduce the number of 
budget activities to provide more flexibility within DOL agencies for 
utilizing funds made available by the Congress. For example, Job Corps 
has experienced growth in the number of centers and in the number of 
students, but there has been a serious decline in funding in the 
staffing account for staff to manage the centers and allow the most 
efficient and effective operation. Staffing directly related to the Job 
corp program could be integrated in order to relate operations support 
activities to results and to reflect the total cost of the program and 
outcomes. Similarly, the Solicitor's Office works to support the 
Department's regulatory agencies in several areas and plays an integral 
part in helping to achieve the Department's goals. We now include 
requests for Solicitor staff when we make resource allocation decisions 
for legal support to OMB and then to Congress. We may want to explore 
additional ways of linking those activities in the regulatory agencies.
    The Department believes that a new activity structure could 
minimize the disconnect between programs and the resources needed to 
carry them out, and could better link total costs of the programs to 
the results. We will continue to explore the feasibility of realignment 
and may propose changes in the DOL budget structure in the preparation 
of the fiscal year 2000 budget.
    Question. How would such modification strengthen accountability for 
program performance in the use of budgeted dollars?
    Answer. Our goals cut across several budget activities, each 
contributing to the goal. In several cases, the overhead account for an 
entire agency represents overhead for all of the budget activities and 
contributes to each of the goals. Flexibility in determining what 
percentage of that account applies to each of the goals would be 
helpful in determining actual costs.
                       managerial cost accounting
    Question. Spending significant resources on performance measurement 
systems appears to be a wasteful exercise if this information is not 
linked to: (1) real data about what it costs to perform various 
government functions; and (2) how to allocate agency resources to 
perform these functions.
    Could you comment on your agency's cost accounting expertise and 
plans to link GPRA to the budget process?
    Answer. Linking cost information to program performance measures 
and indicators is key and Departmental discussions have been underway 
for the last year. We are running a pilot program this year for two of 
our Agencies to test our cost accounting system. This effort is a major 
CFO initiative and it is related to the GPRA provision on performance 
budgeting.
    Question. Under one of the new accounting standards recommended by 
the Federal Accounting Standards Advisory Board (FASAB) and issued by 
OMB, this year for the first time all Federal agencies are required to 
have a system of Managerial Cost Accounting. The clearly preferred 
methodology for such a system, as stated in the standard, is the one 
known as ``Activity-Based Costing'', whereby the full cost is 
calculated for each of the activities of an agency. What is the status 
of your agency's implementation of the Managerial Cost Accounting 
requirement, and are you using Activity-Based Costing?
    Answer. The Department is making good progress in its effort to 
implement a framework for managerial cost accounting. We have already 
modified our core accounting system to capture cost information, and we 
have established a Department-wide workgroup to develop implementation 
strategies in conformance with the direction taken in the Department's 
recently issued fiscal year 1999 Performance Plan. We are on target and 
expect to be able to provide cost data for fiscal year 1999. Given the 
range of activities undertaken throughout the Department, we share the 
view taken by the FASAB that a variety of appropriate cost accumulation 
approaches will be needed.
    Question. Will you be able in the future to show to this committee 
the full and accurate cost of each activity of each program, including 
in those calculations such items as administration, employee benefits 
and depreciation?
    Answer. In addition to the modifications which have been made to 
facilitate cost accumulation in the Department's core accounting 
system, a financial analysis software package has also been acquired to 
be used in allocating overhead costs to direct program activities. The 
``full cost'' of the Department's programs, which will include an 
appropriate share of overhead expenses, will ultimately become part of 
the Department's financial statement presentation.
    Question. By doing so, would we then be able to see more precisely 
the relationship between the dollars spent on a program, the true costs 
of the activities conducted by the program and the results of these 
activities.
    Answer. Once full costing is implemented throughout the Department 
at the program activity level, it will be possible to provide a full 
and accurate distribution of the dollars spent on programs within the 
Department, the true cost of the activities conducted within each 
program and the results of these programs.
    Question. Will you be able to show us the per-unit cost of each 
activity and result?
    Answer. There is much work to be done in determining the relevant 
unit cost information throughout the Department's activities, as well 
as in determining precisely which activities are appropriate for cost 
accumulation. As the Department moves ahead with these analyses, its 
system should be able to provide the per-unit cost of each activity and 
result.
    Question. To what extent do dollars associated with any particular 
performance goal reflect the full cost of all associated activities 
performed in support of that goal? For example, are overhead costs 
fully allocated to goals?
    Answer. We expect to report the full costs for a particular goal in 
a manner that will fully reflect the activities within that goal and 
the overhead associated with that goal.
    Question. Please identify any significant regulatory reform 
measures that have been put in place by your agency in conjunction with 
the development of the agency's performance plan.
    Answer. No rules or regulations have been processed or initiated 
specifically related to the development of the Department's performance 
plan.
             external factors influence on performance plan
    Question. Does your fiscal year 1999 performance plan--briefly or 
by reference to your strategic plan--identify any external factors that 
could influence goal achievement?
    Answer. Section 5 of the DOL Annual Performance Plan includes a 
section on Cross-Cutting Programs and Issues. Several of the issues or 
planning considerations addressed in this section relate to working 
with other government Agencies to achieve the Department's three 
strategic cross-cutting goals. Each of the outcome goals in the 
Performance Plan also address means and strategies. In addition, the 
Department's Strategic Plan identifies key external factors that may 
affect performance.
    Question. If so, what steps have you identified to prepare, 
anticipate and plan for such influences?
    Answer. In the DOL Strategic Plan areas have been identified where 
external influences could impact performance. The Plan also identified 
strategies to achieve goals.
    Question. What impact might external factors have on your resource 
estimates?
    Answer. Most of our external factors are related to economic or 
employment shifts and pending or new legislation. These changes would 
most likely cause a change in how we target our resources causing an 
adjustment in our priorities or a retargeting of our programs within 
the broad scope of the Departmental mission.
    Question. Through the development of the Performance Plan, has the 
agency identified overlapping functions or program duplication? If so, 
does the Performance Plan identify the overlap or duplication?
    Answer. We have not identified overlap or duplication but have 
identified other programs that are complimentary to ours.
    Question. Should agencies address management challenges and 
potential duplication and overlapping functions in their GPRA plans, 
and if so, how?
    Answer. The Department's Performance Plan does address management 
challenges and the coordination efforts with other federal agencies 
that have complimentary programs.
    Question. To what extent has GPRA been used by agency leadership to 
guide decision making? Will this use increase in the future and if so 
in what ways?
    Answer. The Department has traditionally been focussed on results 
and this has been reflected in the internal process for budget 
decisions. GPRA implementation in the Department has continued on this 
path. Internal guidance to agencies in the budget formulation process 
required that requests for new budget initiatives be related to 
Departmental strategic goals and include a discussion of expected 
outcomes with proposed measures and projected cost.
    GPRA principles will be used in many key decisions in the future. 
We are establishing a Management Council to monitor the execution of 
the Department's fiscal year 1999 Performance Plan and subsequent 
plans, and to provide central coordination of all of the Department's 
programs.
                    maturity of performance measures
    Question. Future funding decisions will take into consideration 
actual performance compared to expected or target performance. Given 
that:
    To what extent are your performance measures sufficiently mature to 
allow for these kinds of uses?
    Answer. We are currently assessing systems for reporting program 
performance data with a view toward upgrading or implementing new 
systems which will provide more timely collection and reporting of data 
to all levels of DOL management. The capability to provide ready access 
to program performance data varies markedly. Many of our performance 
measures are sufficiently mature, however, many programs will be 
setting baselines in fiscal year 1998 and 1999.
    Question. Are there any factors, such as inexperience in making 
estimates for certain activities or lack of data that might affect the 
accuracy of resource estimates?
    Answer. Many programs will be setting baselines in fiscal year 1998 
and 1999 and they have used educated estimates in the interim.
    Question. Are you requesting any waivers of non-statutory 
administrative requirements?
    Specifically, are you requesting any relaxation of transfer or 
reprogramming controls in return for specific accountability 
commitments?
    Answer. We are not requesting any additional transfer or 
reprogramming controls in return for specific accountability 
commitments.
                      revisions to strategic plan
    Question. Based on your fiscal year 1999 performance plan, do you 
see any need for any substantive revisions in your strategic plan 
issued on September 30, 1997?
    Answer. The Departmental Strategic Plan, submitted to Congress in 
September 1997, outlined six strategic goals. The fiscal year 1999 
Performance Plan consolidates those goals into three strategic goals. 
These goals support my vision, facilitate increased coordination, and 
foster greater cohesion within the Department. The revision also 
responds to concerns raised by external reviewers that the DOL 
Strategic Plan did not adequately reflect the integration and cross-
cutting nature of DOL's programs. However, because we need to clearly 
align our strategic planning with these three goals, we plan to revise 
the Departmental Strategic Plan soon.
     proposed regulations regarding the black lung benefits program
    Question. It is my understanding that there has been significant 
delay in the promulgation of new black lung regulations by the 
Department of Labor. What has caused the delay in final action on these 
regulations?
    Answer. To make possible the fullest public participation in the 
rulemaking process, the period for the submission of written comments 
was twice extended, to a total of seven months. Two public hearings 
were also held, in Charleston, West Virginia and Washington, D.C. This 
process resulted in over seven hundred pages of hearing testimony and 
several thousand pages of written comments and related exhibits. Every 
major substantive and procedural aspect of the ninety-eight page 
proposal, as well as its possible economic impact on the coal industry, 
drew significant and highly diverse comments.
    Question. When will the Department issue these regulations?
    Answer. The Department is carefully reviewing the testimony and 
comments and will move forward with the process in a manner which will 
take into account the views of all of the affected groups, including 
claimants, large and small coal mine operators, insurers, attorneys, 
physicians and other health care providers.
                     employee stock ownership plans
    Question. The provisions of the Employee Retirement Income Security 
Act (ERISA) set standards to ensure that employee benefit plans are 
properly maintained, and that recordkeeping is accurate and current. It 
is my understanding that the Department of Labor has the fiduciary 
responsibilities of enforcing rules governing the activities of 
Employee Stock Ownership Plans (ESOP's). Title I, Part 5 of ERISA gives 
your department the authority to bring a civil action to correct 
violations of the law.
    While I am certain no two cases are alike, please indicate to me, 
in general, the criteria your department needs to begin an audit of a 
company's ESOP.
    Does the department ever conduct random audits? If so, please 
explain how the department would choose to conduct such an audit.
    Answer. The Department has very broad investigative authority under 
the Employee Retirement Income Security Act to conduct investigations 
to determine whether any person has violated or is about to violate 
ERISA. The initiation of an investigation is at the discretion of the 
Pension and Welfare Benefits Administration, the agency within the 
Department responsible for the enforcement and administration of ERISA. 
Generally, PWBA initiates an investigation of an employee benefit plan 
based on information that a violation has or may have occurred, or is 
likely to occur.
    PWBA does not follow a practice of conducting random audits. With 
over 700,000 pension plans and 2.5 million health and welfare plans 
subject to ERISA, random audits are not an efficient use of PWBA's 
limited investigative resources, which currently consist of 
approximately 350 investigators. PWBA selects plans for investigations 
based on a variety of sources and methods, including complaints 
received from participants of plans and other members of the public; 
computer targeting based on analysis of the database of Form 5500 
annual report filings; referrals from other government agencies; and, 
media reports.
    Question. Approximately how many audits does the department conduct 
each year?
    Answer. During the past three fiscal years, PWBA's enforcement 
program has had the following activity and results:

------------------------------------------------------------------------
                                               Fiscal year--
                                  --------------------------------------
                                       1995         1996         1997
------------------------------------------------------------------------
Civil cases:
    Investigations opened........        4,746        4,528        5,310
    Investigations closed........        3,840        4,201        4,506
Assets recovered (in millions)...       $340.3       $407.4       $363.4
Criminal cases:
    Investigations opened........          104          119          143
    Investigations closed........          102           96           85
    Indictments..................          101           82          105
    Convictions/guilty pleas.....           32           46           45
------------------------------------------------------------------------

    Question. Of the audits conducted by the department, what is the 
approximate percentage of ESOP's that are found to have irregularities?
    Answer. During the past three fiscal years, PWBA's enforcement 
program closed 431 ESOP investigations. Fiduciary violations were found 
in approximately 3 percent of those cases resulting in the recovery of 
approximately $2.8 million. Another $1.1 million monetary recovery was 
obtained in a case where completion of investigative work is still 
pending.
    Other violations that were less serious and may not have resulted 
in quantifiable monetary harm to plans were found in about 25 percent 
of the cases.
    Question. What is the approximate cost on the part of businesses to 
comply with the federal government regulations in the administration of 
ESOP's?
    Answer. An employee stock ownership plan (ESOP) is a defined 
contribution plan. Because most ESOP's are tax qualified, they are 
regulated by both the Department of Labor and the Treasury Department. 
Thus, costs borne by businesses to comply with regulations are based 
upon provisions of the tax code as well as ERISA. Most costs associated 
with ESOP compliance are attributable to tax qualification, but there 
are some costs associated with the reporting and disclosure 
requirements of ERISA (the tax code also requires annual reporting to 
the Federal government). These costs may be paid by an employer or paid 
directly by a plan out of plan assets.
    There is currently no reliable data on costs that would support 
such an analysis. Based on the way plans are designed and drafted, the 
cost of administering a plan may be paid directly by a plan out of its 
trust assets or paid in full or in part by the plan sponsor (e.g. 
corporation which establishes the plan). Although Federal regulation 
does result in some additional expense to plans, including ESOP's, any 
valid estimate would have to determine the extent to which an expense 
relates to Federal regulation as opposed to routine business operations 
(e.g., plan design and drafting expense, accounting and auditing fees, 
etc.). ERISA requires most employee benefit plans, including ESOP's, to 
file an annual report Form 5500 with the IRS and DOL, and if there are 
more than 100 participants in the plan a financial audit must be 
performed. In addition, ESOP's must have stock valuations performed to 
facilitate purchases, sales and distributions of benefits to 
participants, if the underlying employer stock is not publicly traded.
    Question. How often would the department audit an ESOP beyond the 
statute of limitations? What action does the department take if this 
occurs?
    Answer. ERISA's statute of limitations with respect to fiduciary 
breaches provides no action may be commenced after the earlier of six 
years from the date the breach or violation occurred, or three years 
after the earliest date of actual knowledge of the breach or violation. 
In the case of fraud or concealment the statute is extended to not 
later than six years after the discovery of the breach or violation.
    The statute of limitations acts as a bar to legal action with 
respect to a fiduciary's breach of a responsibility, duty or obligation 
in violation of the law. This is a factual question which is usually 
determined during the course of an investigation as information is 
developed which indicates that a violation did in fact occur. 
Generally, if it is known before the investigation commences that a 
potential fiduciary breach has been committed and is beyond the statute 
of limitations, an investigation of that issue would not be pursued 
unless there was a specific reason to do so, such as the development of 
evidence regarding additional, subsequent or continuing violations 
which might be actionable. It is not uncommon for an investigation to 
disclose multiple acts or transactions which give rise to potentially 
multiple fiduciary breaches and thus multiple statutes of limitation, 
which must be analyzed carefully to determine whether the Department 
can take enforcement action to address the violation(s).
    Question. Does the department provide information and advice on 
ESOP compliance requirements?
    Answer. The Department has a formal procedure which has been 
codified, ERISA Proc. 76-1, to answer inquiries of individuals or 
organizations affected directly or indirectly by ERISA as to their 
status under ERISA and as to the effect of certain acts and 
transactions. The answers to such inquiries are categorized as 
``information letters'' and ``advisory opinions.'' Also, each of PWBA's 
Regional Offices and the National Office in Washington have customer 
service representatives who respond to written, telephone and in-person 
requests for technical assistance and information regarding employee 
benefit plans. Information and advice on ERISA-related topics, 
including ESOP's, may be obtained through the more formal written ERISA 
Proc. 76-1 process or through our customer service contacts.
    In addition, as part of our outreach efforts, PWBA representatives 
often speak publicly at seminars, conferences and programs sponsored by 
educational and trade organizations on a variety of employee benefit 
related topics, which may include ESOP related matters.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
                    federal acquisition regulations
    Question. Secretary Herman, what is the substance and the timing of 
the blacklisting regulations promised to the AFL-CIO by Vice President 
Gore over a year ago, regulations that would give the executive branch 
discretion to ``de-bar'' any company from engaging in federal business 
if an unfair labor complaint has been filed against the company with 
the National Labor Relations Board?
    Answer. The Federal Acquisition Regulatory Councils, and not the 
Department of Labor, are responsible for developing proposed changes to 
the Federal Acquisition Regulation (FAR). FAR changes are made through 
notice-and-comment rulemaking. Once proposed FAR changes are published 
in the Federal Register, the public--including all interested 
stakeholders and Members of Congress--will have the opportunity to 
comment on the proposal. No proposal has been published yet, and I am 
not aware of any precise timetable for the process.
    Question. Secretary Herman, although these regulations will be 
issued by the Office of Procurement, and not the Department of Labor, 
is it not true that the procurement system is merely the vehicle for 
pushing through this radical reshaping of labor policy in this country?
    Answer. I do not believe that the possible changes in Federal 
Acquisition Regulation (FAR) under consideration would have the effect 
that you suggest.
                                 ______
                                 
          Questions Submitted by Senator Kay Bailey Hutchison
                      proposed ergonomics standard
    Question. Can you describe the present status of the draft 
ergonomics regulation within OSHA, and do you believe that there should 
be an independent, peer-reviewed analysis of the scientific foundation 
for enacting such a regulation?
    Answer. Currently, we plan to publish a proposed rule in fiscal 
year 1999. OSHA is developing a draft regulatory text for the rule, 
which will be shared with stakeholders later this year. OSHA is also 
examining all available scientific and medical studies related to the 
rule; these will contribute to other sections of our proposal.
    We believe that it may not be necessary to have an independent 
peer-reviewed analysis as part of the process, since the scientific and 
medical evidence upon which any ergonomics rule will be based is peer-
reviewed. In addition, we intend to rely heavily on NIOSH's analysis of 
more than 600 epidemiological studies, all of which were peer-reviewed. 
We expect the rulemaking process to provide additional information and 
that during the course of hearings and public comment, ample 
opportunity will be offered to challenge any and all of the evidence in 
the rulemaking record.
                  safety standards for small business
    Question. This week, I received a response to a letter I sent in 
December to OSHA Assistant Secretary Jeffress expressing concern that 
inappropriate safety standards may be applied to two specific 
industries: arborists and tower erectors. What efforts is the 
Department undertaking to ensure that appropriate and specifically 
tailored safety standards are being applied to these and other smaller 
industries? Specifically, do you believe it makes sense to apply 
commercial logging standards to residential tree pruners?
    Answer. In accordance with the Regulatory Flexibility Act, the 
Paperwork Reduction Act, the Administrative Procedure Act, and the 
Small Business Regulatory Enforcement Fairness Act (SBREFA), OSHA 
conducts numerous analyses of its proposed rules to consider their 
potential impacts on small businesses and on specific industries. 
Following these procedures closely ensures that our safety standards 
are appropriate to the industries covered by the standards. For 
example, if these analyses show that significant adverse impacts are 
anticipated, OSHA takes steps to minimize those impacts. These steps 
may include lengthening compliance deadlines, reducing paperwork 
requirements, or making material modifications to the rule.
    Throughout the rulemaking process, employers and industry groups, 
as well as workers, unions, and interested members of the public, have 
opportunities to review the proposed rule and submit comments to OSHA, 
including the opportunity to testify at public hearings. OSHA then 
addresses these comments in the preamble to the final rule. Under 
SBREFA, small entities are given special consideration through the 
Small Business Advocacy Review Panel process, if the rule is determined 
to have a significant impact on a substantial number of small entities.
    In the case of the Logging Operations Standard (29 CFR 1910.266), 
arborists and their industry representatives participated in the public 
hearings during the rulemaking process, and OSHA addressed their 
concerns in the preamble to the final Logging Operations Standard. OSHA 
also issued a memorandum to its field offices concerning how the 
Logging Operations Standard should be applied to tree pruners. 
Residential tree pruners face many of the same hazards that the Logging 
Operations Standard was designed to address: being hit by heavy tree 
branches; being caught in or crushed by tools and equipment, such as 
chain saws, axes and chippers, that pose hazards whenever they are 
used; and exposure to dangerous environmental conditions, such as heavy 
rain, snow, lightning, strong winds, and extreme cold. OSHA has 
determined that the combination of these factors presents a significant 
risk to employees.
    OSHA's intention in promulgating the Logging Operations Standard 
was to address the hazards associated with cutting trees, wherever 
those hazards are found, including commercial tree trimming and cutting 
operations. OSHA believes that the equipment requirements, safe work 
practices, and training provisions included in the Logging Operations 
Standard will significantly reduce the risks that workers face, and 
will reduce the number and severity of the injuries that occur as a 
result of exposure to the hazards associated with trimming and cutting 
trees.
    With respect to tower erection, the National Association of Tower 
Erectors (NATE) has raised a number of issues with OSHA relating to 
fall protection, employee access to towers, and gin pole safety. Our 
Towers Task Force is engaged in an intensive effort to identify 
specific tower construction safety procedures that will adequately 
protect employees. Once identified, these procedures will be spelled 
out in compliance directives.
    Our Task Force has learned that we are in the midst of an 
extraordinarily active period of tower construction. NATE members 
constructed approximately 16,000 towers in 1997. They expect to build 
large but steadily declining numbers of towers in the next few years: 
12,000 in 1998, 10,000 in 1999, and fewer thereafter.
    OSHA is actively considering formal rulemaking tailored to this 
industry. However, the standards promulgation process can be lengthy, 
and the bulk of the towers planned for the foreseeable future may well 
be built before that process could be completed. OSHA is keenly aware 
of the need to resolve these issues in a much shorter time frame than 
rulemaking may be able to accommodate, and is confident that, through 
the efforts of the Towers Task Force, it can expeditiously identify 
safety procedures that are workable, effective and timely and 
disseminate this information to the industry.
                         workforce development
    Question. As you know, the State of Texas has been a national 
leader in enacting broad-based workforce development reform, in 
anticipation of the federal government doing the same. However the 
State is concerned that many of its reform and consolidation efforts 
may be undone or undermined by federal legislation now pending in 
Congress that ostensibly seeks to achieve the same goals as the Texas 
and other State reforms have sought.
    Do you support legislation, and will you support regulations under 
such legislation, that allow proactive States like Texas to implement 
their own versions of workforce development, so long as those plans are 
consistent with the general purposes of the federal law?
    Answer. The workforce development reform legislation pending before 
Congress (S. 1186, the Workforce Investment Partnership Act, and H.R. 
1385, the Employment, Training and Literacy Enhancement Act) builds 
upon ongoing reform efforts at the State and Federal level. In order to 
honor State-initiated reforms that are consistent with Federal law, the 
Senate legislation contains provisions that would allow States that 
have enacted workforce development legislation prior to December 31, 
1997 to retain certain elements of such legislation. These provisions 
would remain in effect for the entire five years for which the bill is 
authorized. We have determined that approximately 22 States have 
enacted legislation that potentially could be grandfathered under this 
provision, including Texas.
    We believe that the grandfathering provision should apply to the 
following areas, as provided for in the Manager's Amendment to S. 1186, 
the Workforce Investment Partnership Act:
  --Human Resource Investment Councils (HRIC) in accordance with title 
        VII of JTPA to carry out many of the same activities that would 
        be carried out by the Statewide partnership under the bill;
  --Regional and local boards with composition different from the local 
        partnerships under S. 1186 or JTPA. (Texas, Iowa, Utah and New 
        Jersey have done so);
  --Designation of workforce development areas based on the regional 
        planning areas in the State rather than the criteria in S. 
        1186; and
  --Authority to impose financial sanctions under certain conditions on 
        local areas that are continued poor performers.
    Question. Would you please indicate why the Department has failed 
to allow States like Texas the option of contracting-out the delivery 
of Employment Service to responsible, high quality providers? Such 
providers have the potential, do they not, of providing more services 
to more people at a lower cost?
    Answer. First, since 1993, the Department has worked with States, 
such as Texas, to forge workforce development systems that better serve 
job seekers and employers. States have implemented local One-Stop 
centers that provide job seekers and employers with a wide menu of 
services, without contracting-out Employment Service (ES) services. 
Federal funding under the Wagner-Peyser Act supports a national system 
of public employment services. For sixty-four years, with the knowledge 
and approval of Congress, the Department has required States to run 
their Wagner-Peyser ES programs with merit system personnel.
    The question of which public employment services, if any, should be 
available for States to contract-out at State option has national 
implications, and should be decided as a matter of a national policy. 
Moreover, this policy should not be decided in an ad hoc way, with each 
State determining which services are appropriate for contracting-out 
and which are not. The resulting patchwork of delivery system 
approaches could undermine the system's national character and national 
objectives. The Department plans to issue policy guidance after 
resolution of the merit staffing issue before the federal court in 
Michigan, and after a national dialogue on this issue to decide which 
functions authorized under the Wagner-Peyser Act may be construed as 
``commercial'' and therefore available to be delivered by private 
vendors at States' options.
    Second, the Department has not analyzed whether private vendors 
might provide more services at a lower cost. Currently, the national 
Wagner-Peyser Act cost per entered employment for job seekers is $230 
and the entered employment cost in Texas is $154. Over the next several 
years, the Department will engage in a study to better understand the 
variations in services and costs among States. However, States now have 
considerable flexibility in managing the delivery of employment 
services consistent with the merit-staffing requirement. This 
flexibility is encouraged as an aspect of One-Stop system-building and, 
in this regard, we note that One-Stop system-building with a full range 
of services is proceeding well under a merit-staffed delivery system 
for ES in the great number of State workforce development settings.
    Question. With regard to workforce development, do you support 
consolidating federal job training programs? Which programs, if any, do 
you believe should not be consolidated into a larger funding stream, 
and why?
    Answer. Both the House-passed H.R. 1385, and the Senate-reported S. 
1186, take great strides toward consolidation of job training programs. 
The House bill would integrate some 60 training and employment programs 
into a streamlined and consolidated workforce development system, while 
the Senate bill incorporates over 50 programs in the workforce 
investment titles. However, we do not believe this should become a 
numbers game about how many programs are consolidated. There are many 
forms that ``consolidation'' can take, including elimination of 
programs, incorporation of programs into a new, simplified structure 
(for example, summer youth programs are authorized, but not a separate 
program), linkages among programs (for example, the Employment Service 
is closely linked to the new workforce development system), or 
``street-level'' consolidation through the one-stop access to a wide 
range of workforce development related information and services. Both 
House and Senate bills reflect each of these types of consolidation.
    There are reasons why it may not be appropriate to consolidate a 
particular employment and training program into a block grant. Some 
programs have been created to address the needs of special populations, 
such as the disabled, Native Americans, or veterans. The administrative 
structures and systems for the delivery of services may be unique and 
therefore inappropriate to consolidate. Furthermore, the Congress 
created these programs with the intention of assuring that the needs of 
these special populations were addressed, and this could not be assured 
under a block grant. The important thing is to assure access to 
employment and training services for these populations through one-stop 
or ``full service'' centers, which the House and Senate bills will 
ensure.
    Question. Could you please clarify the exact nature and scope of, 
and any details you can provide regarding the implementation of the 
``Work-Flex'' waiver recently granted to Texas?
    Answer. The Work-Flex designation is implemented through a 
modification to the grant the State of Texas has with the Employment 
and Training Administration for administration of the JTPA programs. A 
proposed modification has been formally sent to the State and after 
informal discussions, we believe that all the State questions have been 
answered.
    The Work-Flex modification describes the authority granted to the 
State and also provides examples of material not subject to waiver 
under this authority. As indicated to the State in this material, we 
expect this authority to be extended to June 30, 2002. However, since 
grants are issued annually, the authority for Work-Flex will have to be 
extended in each annual grant.
                                 ______
                                 
             Questions Submitted by Senator Robert C. Byrd
                national mine health and safety academy
    Question. Please provide the amount of revenues received by the 
Academy for the use of its facilities and for classes for fiscal year 
1996, fiscal year 1997, fiscal year 1998, and the projected amount for 
fiscal year 1999.
    Answer. The National Mine Health and Safety Academy raises revenues 
for deposit to the General Fund of the Treasury by charging tuition and 
lodging fees and selling training materials. The Academy has raised the 
following amounts:

------------------------------------------------------------------------
                                                Tuition and    Training
                  Fiscal year                     lodging     materials
                                                    fees        sales
------------------------------------------------------------------------
1996..........................................     $186,251      $99,641
1997..........................................      240,876       79,800
1998 \1\......................................      240,000       79,999
1999 \1\......................................      240,000       77,000
------------------------------------------------------------------------
\1\ The projected amount to be collected is based on past history.

    Question. Please provide the staffing levels at the Academy for 
those same years.
    Answer. The numbers below reflect end-of-year staffing levels.

------------------------------------------------------------------------
                                                    Full-time-
                                                    permanent    Other
------------------------------------------------------------------------
Fiscal year:
    1996..........................................         60  .........
    1997..........................................         63          3
    1998 \1\......................................     \1\ 65      \1\ 1
    1999 \1\......................................     \1\ 67      \1\ 2
------------------------------------------------------------------------
\1\ Projected.

    Question. Please advise how many requests have been made for the 
use of the Academy, how many were granted, and how many were turned 
down for fiscal year 1996, fiscal year 1997, and the numbers that are 
available for fiscal year 1998.
    Answer. The Academy received 877 requests in fiscal year 1996, 836 
requests in fiscal year 1997, and a projected 950 requests for fiscal 
year 1998. All the requests received have been granted, and we expect 
to honor all the requests estimated for fiscal year 1998.
    Question. Does the use of the Academy by other Federal agencies 
result in expanded benefits and cost savings to the taxpayer?
    Answer. Other Federal agencies are offered the use of Academy 
facilities. The Academy does not charge federal agencies for the use of 
classrooms, conference rooms or the auditorium. In fiscal year 1997, 
Academy space was used 115 times by other federal agencies such as the 
Department of Agriculture, Veterans Administration, Bureau of Prisons 
and the Department of Health and Human Services. In fiscal year 1998, 
we are projecting other federal agencies will request the use of the 
Academy 125 times.
    Additionally, safety and health training is provided for industrial 
hygienists, engineers, and local government officials not only for MSHA 
and other federal agencies, but for educational institutions, State 
Department of Mines, State Grant Recipients, and Contract trainers. 
Also, space is made available to state and local government agencies 
upon request.
    Question. Has the training provided at the Mine Academy led to a 
significantly reduced number of mine-related deaths across the nation?
    Answer. We believe the Academy's training has contributed to the 
reduction of mine-related fatalities. The Academy develops current 
accident-focused course curriculum and accident prevention and 
occupational health awareness programs. Also, it responds to requests 
for specialized safety and health training programs and materials from 
the mining industry. Academy on-site training is provided to both mine 
inspectors and interested industry personnel. Off-site training is also 
provided to the mining industry and MSHA districts throughout the 
country. This training is directly related to improving the health and 
safety of all miners. During fiscal year 1998, the National Mine Health 
and Safety Academy will provide 550 course days of training to ensure 
that MSHA's mine inspectors, other federal and state employees, and 
mining industry personnel are trained to recognize, eliminate and 
prevent hazardous conditions in the mining environment. The Academy 
continues to increase the number of training courses and available 
printed materials to inspectors and the mining industry, in general, 
and has increased the number of off-site training opportunities.
    It is universally recognized that training saves lives and prevents 
injures and illnesses. Unfortunately, the training rider added to 
MSHA's appropriation language prevents the agency from enforcing basic 
statutory safety and health training for miners at more than 10,000 
nonmetal mines employing more than 125,000 workers. Removal of the 
rider would facilitate much needed safety and health training for this 
sector of the industry. The training rider is an impediment to MSHA's 
ability to reverse the upsurge in fatal accidents in the metal and 
nonmetal mining sector. In 1997, 75 percent of the deaths at metal and 
nonmetal mines occurred at operations where MSHA cannot enforce basic 
safety and health training for miners. Also, more than 60 percent of 
the victims had received little or no training.
    The positive effects of training have helped reduce mining 
fatalities from a total of 247 in 1977 (which was the first year 
training was mandated for all miners) to 90 fatalities in 1997.
                      charleston job corps center
    Question. Pursuant to the opening of the new Job Corps center in 
Charleston, West Virginia, I would like to know how many employees are 
currently working in the new facility and how many are projected for 
fiscal year 1999; in addition, please provide staffing levels for the 
previous facility for fiscal year 1996, fiscal year 1997, and fiscal 
year 1998.
    Answer. The new Charleston facility is budgeted for 139 full-time 
equivalent (FTE) staffing positions. According to the most recent 
report from the center contractor, 129 of these positions were filled 
as of February 28, 1998. We anticipate that the budgeted staffing level 
of 139 FTE will be maintained for the foreseeable future. Before the 
Charleston Job Corps center was relocated to its new facility in the 
Fall of 1997, the old facility was budgeted for 137 FTE. The budgeted 
FTE staffing levels at the end of the 4 fiscal years mentioned in your 
question are as follows:

Fiscal year:
    1996 old facility.............................................   137
    1997 old facility.............................................   137
    1998 new facility.............................................   139
    1999 new facility (planned)...................................   139

    Question. If possible, please estimate the total annual economic 
impact on the area, including salaries and other purchases, for fiscal 
year 1999.
    Answer. In fiscal year 1999, approximately $7 million will be spent 
by Job Corps in Charleston, West Virginia and the surrounding vicinity. 
These federal expenditures will be in the form of staff salaries and 
benefits, local purchases of goods and services, and allowance payments 
to the students at the Charleston Job Corps center.
    Question. Please also advise me how many students the new facility 
can accommodate and how many students are currently enrolled.
    Answer. The new facility can accommodate 400 students at a time. 
According to the most recent attendance report (for March 18, 1998) 363 
students are currently enrolled. Steps are being taken to bring the 
center to its full enrollment capacity of 400 students in the very near 
future.
                     cooperative compliance program
    Question. I have noticed that the Department has requested an 
increase of $2.8 million and 23 FTE's to increase on-site safety and 
health enforcement in highly hazardous workplaces by continuing the 
implementation of Cooperative Compliance Programs nationwide.
    Given the recent court-imposed stay on the implementation of these 
programs--and their uncertain future--what contingency plans does the 
Department have should the federal Court of Appeals prevent or 
significantly alter their implementation?
    Answer. OSHA does have a contingency plan for inspection 
scheduling, but there is not a contingency program for the cooperative 
aspect because this is one of the issues in the case brought against 
the CCP. We expect the court to eventually rule in OSHA's favor and the 
Cooperative Compliance Program (CCP) will then continue. In the 
meantime we will continue to work on cooperative efforts through local 
initiatives, OSHA consultation programs, OSHA voluntary protection 
programs (VPP), and compliance assistance.
    Prior to the CCP, past targeting systems were often and regularly 
criticized by industry and employee groups for inspecting employers 
with good safety and health records instead of concentrating on 
employers that failed to protect their workers. All interested parties 
agreed that OSHA needed some sort of system to target. The previous 
system only provided for inspection targeting based upon industries 
with elevated injury and illness rates, as opposed to targeting 
establishments with high rates. Consequently, when OSHA arrived at a 
work site the agency did not know if the establishment had a high or a 
low rate. Regardless of the individual employer's injury and illness 
rate, OSHA did an inspection.
    The new system that the CCP is based upon targets individual 
worksites with elevated rates. As a result, our resources are directed 
at employers most in need of an OSHA intervention. Regarding the stay 
of the CCP, we do not expect the court to rule until at least December 
1998 or January 1999. Therefore, the new program is essentially on 
hold. In the meantime, we have proposed an alternative targeting 
system, based upon site specific injury and illness data from the OSHA 
Data Initiative. This program, due to the stay, does not have a 
cooperative component. On April 6, 1998, the court ordered that the 
stay on the CCP program does not encompass OSHA's contingency plan for 
inspection targeting thereby allowing us to use this alternative 
system.
    The interim OSHA targeting plan uses BLS data for 1996 to identify 
the one hundred industries, as characterized by four-digit SIC Codes, 
with the highest lost workday injury and illness (LWDII) rates, 
excluding construction, agriculture, mining, and public administration. 
For those four-digit SIC Codes for which BLS did not report LWDII rates 
at the four-digit level (such as non-manufacturing), OSHA attributed 
the rate reported by BLS for the three-digit SIC's. Eight SIC's were 
not included in OSHA's 1996 data survey, and there are therefore no 
establishment-specific LWDII data for them. The final listing of 
industries containing establishments to be inspected therefore excludes 
those eight SIC's and includes the 99 four-digit SIC's with the highest 
LWDII's for which OSHA has establishment specific data.
    For each four-digit SIC on the list, each establishment with an 
LWDII rate at or above the average LWDII rate for that four-digit 
industry will be subject to an inspection with the exception of 
establishments in SIC 8051, ``Skilled nursing care facilities,'' SIC 
8052, ``Intermediate care facilities'' and SIC 8059, ``Nursing and 
personal care not elsewhere classified.'' Those three industries 
contained many more establishments than the other SIC's on the list. To 
avoid over-concentration on inspections in those three industries, only 
the top 20 percent of the establishments in those SIC's with LWDII's 
above the industry average will be subject to inspection. All 
establishments subject to inspection will have an equal chance of being 
inspected. The national office will provide each area office with a 
list of establishments within the area office's jurisdiction that are 
subject to inspection under the plan.
    Question. In particular, how would the additional $2.8 million 
requested for federal enforcement activities under this program be 
spent if the Department were not able to implement the Cooperative 
Compliance Program?
    Answer. The budget request for 23 FTE and $2,750,000 is tied to the 
agency's efforts to enhance construction expertise in OSHA as well as 
to provide additional resources to help implement the Cooperative 
Compliance Program (CCP). The CCP is OSHA's current approach to 
addressing high-hazard industries and workplaces and offering 
partnerships with participating employers. Even if the courts should 
rule against OSHA's current CCP scheme, we would still use the 
requested resources to focus on high-hazard areas and to generate 
partnership opportunities with employers to reduce workplace exposure 
to hazards.
transfer of certain administrative services of part b of the black lung 
                        program from ssa to dol
    Question. The conference report accompanying the fiscal year 1998 
Department of Labor, Health and Human Services, Education and Related 
Agencies Appropriation Bill included language directing the Inspectors 
Generals (IG) of the Department of Labor (DOL) and the Social Security 
Administration to provide annual, joint reports to the Committee on 
Appropriations on the Memorandum of Understanding (MOU) between the DOL 
and the SSA which transfers certain administrative services of Part B 
of the Black Lung Program from the SSA to the DOL. The purpose this 
report is to help Congress monitor whether the terms of the MOU are 
being followed.
    What is the status of the transfer of certain administrative 
services under the MOU?
    Answer. The Memorandum of Understanding (MOU) between the Social 
Security Administration (SSA) and the Office of Workers' Compensation 
Programs (OWCP) of the Department of Labor concerning maintenance 
activities for beneficiaries under Part B of the Federal Black Lung 
Program was signed September 26, 1997. Under the terms of the MOU, the 
Department has assumed responsibility for all routine maintenance 
activities associated with the Part B claims. The Social Security 
Administration (SSA) retains responsibility for taking applications on 
Part B claims and forwarding them to the appropriate DOL office for 
processing and also the responsibility for conducting Administrative 
Law Judge (ALJ) hearings to resolve contested issues, including 
overpayment issues, arising from Part B claims. SSA also retains the 
responsibility for considering appeals taken from ALJ decisions. 
Instances of possible fraud or abuse are also referred to the SSA OIG 
for investigation and possible prosecution.
    OWCP has devoted 17 FTE and 10 contract mail and file and data 
entry staff to Part B case work and SSA has agreed to pay the 
Department $2,475,970 for administrative services being performed in 
fiscal year 1998. However, negotiations with SSA have not been 
completed for the administrative costs for fiscal year 1999. The 
program currently estimates its Part B needs at $2,551,000 for fiscal 
year 1999.
    While the OWCP Division of Coal Mine Workers' Compensation is 
responsible for coordination and consultation in implementing the 
Memorandum of Understanding, ultimate responsibility for the policy, 
conduct, and administration of the Part B Black Lung program, including 
the services provided by OWCP, continues to rest with SSA.
    SSA delivered its electronic records for those beneficiaries to 
OWCP during the first week of October 1997. Benefits for the October 
entitlement period were prepared by OWCP and issued on November 3, 
1997. OWCP will have processed $350 million in monthly disability and 
survivors benefits to over 100,000 households, as of May 3, 1998.
    Typical claims maintenance actions are being performed by OWCP in 
one week or less from receipt of the necessary information from the 
beneficiary. Overall, the transfer has proceeded very smoothly with a 
high level of service being provided to the beneficiaries.
    Question. Has the DOL received any complaints from beneficiaries on 
the implementation?
    Answer. The initial mailing by the Social Security Administration 
to the beneficiaries, informing them of the transfer of administrative 
services and of which OWCP office would be responsible for their 
individual claims in the future, resulted in a large volume of 
inquiries to the nine OWCP offices' 800 numbers. The great majority of 
those telephone calls were inquiries rather than complaints. In those 
instances where the beneficiaries identified problems, they were 
addressed in the individual cases. Very few of the beneficiaries have 
felt it necessary to seek Congressional assistance to help resolve 
their individual problems. In December 1997, 22 Congressional inquiries 
were received in the nine OWCP claims servicing offices. In January 
1998, there were 13 such Congressional inquiries; in February, only 8. 
When compared to approximately 104,000 monthly beneficiaries, these 
numbers are very small and the trend is clearly moving in the right 
direction.
    Question. What is the status of the report the DOL IG is compiling 
with the IG of SSA?
    Answer. The initial planning phase of the audit requested by the 
Committee has begun with various preliminary activities. The OIG has 
met with staff from the Black Lung Program to obtain appropriate data 
necessary to perform the audit. In addition, we will be meeting with 
staff of the Social Security Administration OIG to coordinate and 
define the role of each office in the project. We anticipate allocating 
time over the next several months to data collection and coordination 
activities. In order to assess information through the end of fiscal 
year 1998, as requested by the Committee, the bulk of our audit work 
will be started in October 1998. Our final report will be issued on, or 
before, March 31, 1999, as required.
                   year 2000 computer problem at dol
    Question. What efforts are being made by the Department to prepare 
for the year 2000 computer problem?
    Answer. The Secretary of Labor has made Year 2000 compliance a top 
Departmental priority and has taken the necessary steps to accelerate 
progress in reaching the Department's target goals for Year 2000. The 
Deputy Secretary meets with each agency head on agency Year 2000 
progress. The Chief Information Officer (CIO) meets with agency heads 
to resolve problems and keeps the Deputy Secretary informed of progress 
weekly. The Office of the CIO has just completed an in depth review by 
agency of Year 2000 preparations to assure that the Department is 
prepared and has its computer systems ready for the Year 2000.
    In a memorandum dated December 31, 1997, the Secretary of Labor 
outlined to the DOL executive staff the steps to be taken to accelerate 
progress in reaching the Department's target goals for Year 2000. In 
this memorandum, the Secretary made it emphatically clear that Year 
2000 conversion is not to take the backseat to any other competing 
program initiatives--it is top priority.
    Management tools used to track progress and manage the effort 
include a quarterly internal report used to assess system needs and to 
track progress against established goals. A monthly exception report 
has been established, beginning February, 1998, requiring a report of 
any deviations from their Year 2000 plan. This report provides an 
``early warning'' of potential issues needing attention and reduces 
risk.
    Should a system fall behind schedule, deviate from plans or 
encounter unforeseen problems, an ``early warning'' is received on a 
monthly basis through meetings of the Deputy CIO with Year 2000 
managers. The monthly exception report is used to advise the CIO, the 
Deputy Secretary and the Secretary of deviations.
    The CIO is hiring a Year 2000 contractor to provide additional 
support to CIO functions and to provide assistance to the agencies 
where needed. The CIO has entered into a partnership with the Inspector 
General to assist in Year 2000 matters by attesting to the viability of 
agency plans, progress and reports.
    The Department has taken aggressive measures to meet the new OMB 
mission critical target dates. Systems activities have been accelerated 
to meet the new deadlines. Acceleration has been achieved by increased 
resources, repairing rather than replacing systems and making year 2000 
modifications a top priority.
    The Department continues to show substantial progress in meeting 
Year 2000 mission critical objectives. The number of mission critical 
systems becoming Year 2000 compliant has increased from 16 percent to 
21 percent as reported in the most recent quarterly report to OMB. DOL 
management has demanded that Federal programming and contractor staff 
establish and follow aggressive schedules to convert and test 
applications/systems, including menus, sub-routines, programs, etc. 
Work on the remaining mission critical systems has been accelerated to 
meet the new government-wide goal to complete implementation by March 
1999.
    Other Year 2000 initiatives are listed below.
  --FTS2000 is the primary telecommunications service used by the 
        Department and all host mainframe facilities are provided under 
        other contracts. The Department is currently reviewing all non-
        FTS2000 data and voice grade telecommunication systems for Year 
        2000 compliance. Plans are being developed to upgrade/replace 
        systems as necessary.
  --The Department is currently analyzing its facilities and embedded 
        systems for Year 2000 implications to ensure all Departmental 
        facilities, laboratory training equipment and computer products 
        with embedded systems chips are compliant or have ``work 
        around'' capability. Plans are being developed to solve any 
        Year 2000 problems found within internal systems used to 
        control, monitor or assist the operation of equipment, 
        machinery or building maintenance which include HVAC, 
        elevators, security systems, network hardware and 
        telecommunications with embedded computer chips. The process of 
        contacting contractors and supply vendors to determine the 
        current level of compliance in their equipment and to prepare 
        schedules for upgrades and replacements, as well as testing 
        plans, is on-going.
  --The Department has emphasized approaching the compliance issue for 
        facilities on a mission-focused basis. Primary emphasis is 
        placed on those facilities and equipment that impacts the 
        essential missions such as providing workplace safety and 
        health, critical infrastructures needed to carry out the 
        Department's mission as well as the infrastructure needed for 
        employees to do their work. Toward that end, the laboratory and 
        testing facilities of the Department have been surveyed to 
        determine what equipment is at risk. Manufacturers and vendors 
        are being contacted to determine whether equipment contains 
        date sensitive embedded chips, whether upgrades can be obtained 
        or whether replacement equipment must be purchased. All micro-
        computers and LAN/WAN facilities either are now compliant or 
        resources have been dedicated to ensure timely compliance.
  --The Department identified over 3,000 data exchanges with States and 
        other partners. In February of this year, the Deputy CIO 
        visited the CIO for the Commonwealth of Pennsylvania to review 
        State interfaces as a quality check for the exchange of 
        information data process. These materials were also sent to the 
        States of Washington and California for further review.
  --The Department's host mainframe provider has successfully tested a 
        Year 2000 compliant Logical Partition Region. This significant 
        milestone allows for compliance testing of renovated host 
        systems.
    In summary, the Office of the Chief Information Officer continues 
to work to identify and resolve potential problems relating to the Year 
2000 should they arise.
    Question. Should the Department fail to address the issue in time, 
how might black lung beneficiaries and those applying for benefits be 
affected?
    Answer. Sensitive elements in the legacy Automated Support Package 
(ASP) are being renovated to make them Year 2000 compliant. This will 
accelerate the scheduled implementation date for these elements for 
Year 2000 to March 1999. Work will continue concurrently on the fully 
Year 2000 replacement system. This decision to repair the mission 
critical functionality resolves a potential issue related to a delay 
caused by the late execution of the contract for system replacement.
    This system tracks the status, history and location of claims filed 
for black lung benefits. It also generates payment of medical and 
compensation for eligible recipients and maintains a history of 
benefits paid, accounting and financial data.
    The Department's Year 2000 contingency policy requires contingency 
plans for all mission critical systems. These plans are scheduled to be 
completed by July 1998. Contingency plans have already been developed 
under previous guidelines for certain targeted systems. Such is the 
case for the Black Lung ASP system.
    The renovation actions referenced above should preclude any type of 
system failure which might affect beneficiary payments, medical 
reimbursements to health care providers, result in overpayments or 
cause delays in responding to inquiries.
                                 ______
                                 
                Questions Submitted by Senator Herb Kohl
                      retiree health care coverage
    Question. Every day around the country more companies inform their 
retirees that they are unable to continue to provide health care 
coverage that they promised in past agreements. Between 1988 and 1996 
availability of retiree health coverage declined by 8 percent among 
businesses with 500 or more employees. Too late, retired people find 
out that in the small print of their contracts a loophole allows the 
employer to end coverage if it gets too expensive. As I am sure you are 
aware, this happened to the employees of the Pabst Brewing Company in 
late 1996. They were left stunned and feeling lied to both by the 
company and the government who they thought had insured their benefits. 
What can the Department of Labor do for workers in this situation?
    Answer. Retiree health benefits, like other employment based 
benefits, are subject to the protections of Title I of the Employee 
Retirement Income Security Act (ERISA). Unlike defined benefit pension 
plans, however, these benefits are not guaranteed by the Federal 
Government.
    In 1993, the Department of Labor began looking for opportunities to 
offer its view of the law to support the legitimate expectations of 
employees who believed that they had been promised lifetime retiree 
health benefits. Since then we have filed several amicus briefs 
attempting to clarify benefit terms and help preserve the health 
benefits of the retirees involved. We filed five amicus briefs in the 
Pabst case, including a brief recently filed in the Seventh Circuit 
Court of Appeals, and have participated in several other cases. We have 
also published a brochure to assist retirees in understanding the terms 
of their health plan in order to better assess their options in the 
event of a termination or reduction of benefits.
    Question. Is legislation necessary to provide further protection 
under the Employee Retirement Income Security Act (ERISA)?
    Answer. The Administration proposed, and Senator Moynihan and Rep. 
Stark subsequently introduced, legislation that would amend ERISA to 
require that retirees, age 55 or older whose retiree health benefits 
are cut, be allowed to buy into their former employers' plans for 
active employees at a price not greater than 125 percent of the average 
cost for the group (S. 1749 and H.R. 3470). The legislation would also 
offer displaced workers aged 55 to 62 who lose benefits access to 
affordable coverage by buying into Medicare, and offer individuals aged 
62 to 65 access to Medicare benefits under a special program until they 
become eligible for the traditional Medicare program.
                      osha partnership initiatives
    Question. Many voices in Congress are calling for OSHA reform. They 
are pushing for, and I support, an OSHA that focuses on consultation 
and working with employers to improve safety instead of just levying 
fines. In the last few years OSHA has responded to these demands and 
begun to change its focus, it is now encouraging employers to work with 
them for safer workplaces. I am proud to note that the Vice President 
and the Department of Labor just recently honored Wisconsin Box Co. for 
its exemplary participation in OSHA's Cooperative Compliance Program 
(CCP). Has this program moved OSHA away from being an organization that 
employers fear as too arbitrary and authoritarian, to one they can work 
with to improve workplace safety?
    Answer. OSHA has sought a variety of ways to work with employers in 
achieving improved safety and health conditions in the workplace. The 
CCP effort was specifically intended to address conditions at those 
worksites with elevated injury and illness rates by offering 
partnership opportunities for employers and OSHA to work together to 
reduce those rates. We would like to think that the nearly 90 percent 
of employers that chose to participate in the CCP did so because they 
believed that they could successfully work together with OSHA to 
improve workplace safety and health. The experience of Wisconsin Box 
Company is testimony to the positive effect this type of program can 
have in improving working conditions.
                              stay on ccp
    Question. The Chamber of Commerce and National Association of 
Manufacturers are challenging the CCP program in court, halting the 
program. Does the Department of Labor have a back-up plan to make sure 
that cooperation and consultation continues?
    Answer. OSHA does have a contingency plan for inspection 
scheduling, but there is not a contingency program for the cooperative 
aspect. We expect the court to eventually rule in OSHA's favor and the 
Cooperative Compliance Program (CCP) will then continue. In the 
meantime we will continue to work on cooperative efforts through local 
initiatives, OSHA consultation programs, OSHA voluntary protection 
programs (VPP), and compliance assistance. OSHA consultation programs 
have been and will continue to be a major part of OSHA's cooperative 
efforts. The court stay does not affect or alter these efforts.
                           dislocated workers
    Question. Our economy today is the healthiest it has been in 
decades. Unemployment rates in recent months have remained very low 
while inflation has been stable. While this is all good news, factories 
continue to close and some workers are still without jobs. All the 
sunny statements about the economy don't mean much to someone who has 
just been laid off. The President mentioned in his State of the Union 
address creating a program to aid communities after plant closings 
similarly to what the government does after a military base is closed.
    While I understand that some of this effort would be coordinated 
with the Department of Commerce, how will the Department of Labor be 
involved?
    Answer. The Title III dislocated worker program requires States to 
initiate rapid response assistance within a short period of time 
(preferably 48 hours or less) after notice/information is received by 
the State Dislocated Worker Unit of an impending mass layoff or plant 
closure. The purpose of this assistance is to begin to share 
information with the workers and the employer regarding the type of 
readjustment assistance that is available in the community, including 
federal funds to provide re-employment services and facilitation in 
forming a labor-management committee to determine what types of 
assistance the workers at a specific dislocation are expected to 
require.
    In order to address some of the concerns regarding communities that 
are being especially hard-hit by dislocations of unskilled workers with 
limited re-employment options and as part of the President's 
initiative, the Department of Labor is currently collaborating with the 
Departments of Commerce and Treasury to find ways to assist such local 
communities in responding to closures and downsizing. This is 
particularly critical in communities needing to actively grow or 
attract new businesses. In this regard, important elements of rapid 
response assistance include: providing or obtaining appropriate 
financial and technical advice and liaison with economic development 
agencies and other organizations to assist in efforts to avert worker 
dislocations; and assisting the local community in developing its own 
coordinated response and in obtaining access to State economic 
development assistance.
    Strategies developed by the Departments of Labor, Commerce, 
Treasury and other agencies are expected to provide opportunities for 
local communities to enhance such planning envisioned by rapid 
response, and to encourage the formation of community transition 
committees to respond to mass layoffs and plant closures.
    Question. On a slightly different note, how do you see the 
Workforce Investment Partnership Act that is currently awaiting 
consideration by the Senate, helping the dislocated worker?
    Answer. The Workforce Investment Partnership Act would help the 
dislocated worker by:
  --Maintaining a separate funding stream for dislocated workers, not 
        only ensuring current resources, but retaining the ability to 
        request increased funding based upon the needs of this targeted 
        population. This is a major improvement over the provisions 
        contained in the consolidation bills considered in the 104th 
        Congress.
  --Maintaining a viable National Reserve Account (National Emergency 
        Grants) to allow the Secretary of Labor to respond to mass 
        layoffs, plant closures, and natural disasters.
  --Continuing the requirement that States conduct rapid response: the 
        provision of onsite assistance to workers as soon as news of a 
        layoff or plant closure is received. This is a valuable early 
        intervention tool through which workers are provided 
        information they need to start the transition process to new 
        employment. Their need for services to regain employment is 
        assessed and access to such services is facilitated.
  --Continuing to allocate funds to carry out dislocated worker 
        research and demonstrations from the national level, as well as 
        technical assistance for continuous improvement of dislocated 
        worker services.
    In addition, dislocated workers will benefit from the other reform 
elements contained in the bill. Establishing One-Stop centers as the 
framework of the new system would improve dislocated workers' access to 
quality labor market information and services, and proposed skill 
grants and training performance information, or the Individual Training 
Account system, would enable them to make informed choices about 
training opportunities with qualified vendors.
              job training reform/youth opportunity areas
    Question. The Congress will again try to pass a job training reform 
bill this year. This time however, there is even more pressure for 
swift action than in the past. Last year this committee appropriated 
$250 million for Opportunities for Out-of-School Youth that cannot be 
used unless authorizing legislation is signed into law by July 1st of 
this year.
    If Congress does not consider this legislation soon, and fails to 
meet the July 1st deadline, what would be some possible effects?
    Answer. The Youth Opportunity Area initiative is designed to boost 
the employment rate of out-of-school youth ages 16 to 24 in high-
poverty areas from current levels of less than 50 percent to a level of 
80 percent. The pervasive joblessness that now exists in high-poverty 
neighborhoods is an underlying cause of the poverty, crime, youth 
gangs, drug abuse, welfare dependency, and family breakdown that 
characterize these communities. The effect of losing the $250 million 
will be to lose a chance to significantly change these communities and 
improve the lives of youth who live in them.
    Question. Could this group be served by another program? Does the 
Department of Labor have a ``back up'' plan?
    Answer. Apart from the small-scale Youth Opportunity Area pilots 
the Department is conducting in six communities with plans to expand 
the number of sites in PY 1998, there is no other DOL employment and 
training program that is strictly targeted on high-poverty urban and 
rural areas. DOL very much wants to implement the $250 million Youth 
Opportunity Area initiative. DOL will continue to work with Congress 
toward enactment of Workforce Development legislation in time to 
trigger the $250 million advance appropriation. We believe that the 
bill will be signed into law by July 1.

                          subcommittee recess

    Senator Specter. Thank you very much, Madam Secretary, that 
concludes the hearing. We appreciate your being here. The 
subcommittee will stand in recess until 2 p.m., Wednesday, 
April 1, when we will meet in room SD-192 to hear from Dr. 
Harold Varmus of the National Institutes of Health.
    [Whereupon, at 2:57 p.m., Wednesday, March 18, the 
subcommittee was recessed, to reconvene at 2 p.m., Wednesday, 
April 1.]


  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1999

                              ----------                              


                        WEDNESDAY, APRIL 1, 1998

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:20 p.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Arlen Specter (chairman) 
presiding.
    Present: Senators Specter, Cochran, Faircloth, Bumpers, and 
Kohl.

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

                     National Institutes of Health

STATEMENT OF HAROLD E. VARMUS, M.D., DIRECTOR
ACCOMPANIED BY:
        RUTH KIRSCHSTEIN, M.D., DEPUTY DIRECTOR, NATIONAL INSTITUTE OF 
            HEALTH
        RICHARD KLAUSNER, M.D., DIRECTOR, NATIONAL CANCER INSTITUTE
        CLAUDE LENFANT, M.D., DIRECTOR, NATIONAL HEART, LUNG, AND BLOOD 
            INSTITUTE
        HAROLD SLAVKIN, M.D., DIRECTOR, NATIONAL INSTITUTE OF DENTAL 
            RESEARCH
        PHILIP GORDEN, M.D., DIRECTOR, NATIONAL INSTITUTE FOR DIABETES 
            AND DIGESTIVE AND KIDNEY DISEASES
        AUDREY S. PENN, M.D., ACTING DIRECTOR, NATIONAL INSTITUTE OF 
            NEUROLOGICAL DISORDERS AND STROKE
        ANTHONY S. FAUCI, M.D., DIRECTOR, NATIONAL INSTITUTE OF ALLERGY 
            AND INFECTIOUS DISEASES
        MARVIN CASSMAN, M.D., DIRECTOR, NATIONAL INSTITUTE OF GENERAL 
            MEDICAL SERVICES
        DUANE ALEXANDER, M.D., DIRECTOR, NATIONAL INSTITUTE OF CHILD 
            HEALTH AND HUMAN DEVELOPMENT
        CARL KUPFER, M.D., DIRECTOR, NATIONAL EYE INSTITUTE
        KENNETH OLDEN, M.D., DIRECTOR, NATIONAL INSTITUTE OF 
            ENVIRONMENTAL HEALTH SCIENCES
        RICHARD J. HODES, M.D., DIRECTOR, NATIONAL INSTITUTE ON AGING
        STEPHEN I. KATZ, M.D., DIRECTOR, NATIONAL INSTITUTE OF 
            ARTHRITIS AND MUSCULOSKELETAL AND SKIN DISEASES
        JAMES F. BATTEY, M.D., DIRECTOR, NATIONAL INSTITUTE ON DEAFNESS 
            AND OTHER COMMUNICATION DISORDERS
        STEVEN E. HYMAN, M.D., DIRECTOR, NATIONAL INSTITUTE OF MENTAL 
            HEALTH
        ALAN I. LESHNER, M.D., DIRECTOR, NATIONAL INSTITUTE ON DRUG 
            ABUSE
        ENOCH GORDIS, M.D., DIRECTOR, NATIONAL INSTITUTE ON ALCOHOL 
            ABUSE AND ALCOHOLISM
        PATRICIA A. GRADY, M.D., DIRECTOR, NATIONAL INSTITUTE OF 
            NURSING RESEARCH
        FRANCIS S. COLLINS, M.D., DIRECTOR, NATIONAL HUMAN GENOME 
            RESEARCH INSTITUTE
        JUDITH L. VAITUKAITIS, M.D., DIRECTOR, NATIONAL CENTER FOR 
            RESEARCH RESOURCES
        PHILIP E. SCHAMBRA, M.D., DIRECTOR, FOGARTY INTERNATIONAL 
            CENTER
        DONALD A. B. LINDBERG, M.D., DIRECTOR, NATIONAL LIBRARY OF 
            MEDICINE
        JACK WHITESCARVER, M.D., ACTING DIRECTOR, OFFICE OF AIDS 
            RESEARCH
        DENNIS P. WILLIAMS, DEPUTY ASSISTANT SECRETARY, BUDGET, 
            DEPARTMENT OF HEALTH AND HUMAN SERVICES

                   opening remarks of senator specter

    Senator Specter. Good afternoon, ladies and gentlemen. The 
Subcommittee on Labor, Health and Human Services, and Education 
will now proceed.
    I regret our late start. We had a vote scheduled for 2 
o'clock, and if I am there to vote at 2 o'clock, I can get out 
at 2:01 and be here to have the minimal interruption with the 
hearing. But the 2 o'clock vote was postponed to 2:10, and then 
2:15, and then 2:17. Then they decided to do that because they 
scheduled a vote right behind it. That 30 second explanation 
does not tell you about the proceedings in the Senate. I value 
your time very highly. I know this is an extraordinary 
assemblage of talent. As the saying goes, there is more talent 
in this room since President Kennedy dined alone--and I had 
better be careful of what I say here. [Laughter.]
    The National Institutes of Health, as I so frequently say, 
in my opinion is the crown jewel of the Federal Government. 
Besides that, you are good. [Laughter.]
    It may not take too much to be the crown jewel of the 
Federal Government, but the National Institutes of Health has 
set a mark in what you have accomplished and I am a total 
supporter.
    We have a Federal budget of $1.7 trillion and if we set our 
priorities in order, there will be no problem in increasing 
your funding tremendously.
    We give lip service to doubling the NIH budget over 5 
years. It unanimously passed last year, 97 to 0. With Senator 
Harkin and I working together, crossing party lines--I learned 
a long time ago if you want anything done in Washington, you 
have to cross party lines and get bipartisan support--we tried 
to put the money into it by $1 billion plus budget amendment 
because the health account had been cut by $100 million, and it 
was defeated 63 to 27.
    We have readied an amendment for $2 billion extra. We are 
talking about doubling, which would be more than $2.5 billion, 
but we are talking about a $2 billion addition.
    I know that there are many grants not funded, and we would 
like to open up those doors if we possibly can.
    So this having been said, Dr. Varmus, we welcome you. We 
welcome your colleagues.
    We will have to vote again in a few minutes, so we are 
under time constraints, as usual. That is nothing extraordinary 
for the Senate and this distinguished panel is used to that as 
well.
    So let us set a 5-minute time limit. Your full statements 
will be made a part of the record and, to the extent you can 
summarize, we would appreciate it.

                 summary statement of Dr. Harold Varmus

    Dr. Varmus. Mr. Chairman, thank you very much. I appreciate 
those warm welcoming remarks. I will be extremely brief so that 
we can get on with the questioning.

                            increase Funding

    I am here for the fifth time representing the NIH. I am 
very pleased to be here to present an extraordinary budget by 
the President for 1999 of $14.797 billion, an 8.5-percent 
increase over our 1998 level, and a projected increase over the 
next 5 years up to a $20 billion final budget, a 50-percent 
increase.
    In our view, this is a wonderful time for such an increase. 
Research in biology and medicine is moving at an unprecedented 
pace. The public health needs continue to be great, both here, 
as the population ages, and abroad, and especially in our 
minority populations.
    I am going to omit a litany of our accomplishments, the 
great promises that new technologies offer, and simply mention, 
very briefly, four of the ways in which the Institutes and 
centers would spend this unprecedented $1.15 billion increase. 
Then we can get into some questioning to talk about specific 
projects they have in mind.
    First, with this year's budget, we would fund an 
unprecedented number of research grants, with a healthy success 
rate and adequate levels of support for individual grantees, 
allowing us to pursue the many exciting initiatives that are 
described in the NIH areas of emphasis package.
    Second, we would be able to implement many new, innovative 
components in our clinical research enterprise--recruitment of 
clinical investigators, training, career awards, clinical 
trials--as outlined in a letter that I recently sent to you in 
response to your question about our clinical research 
activities.
    The third area of focus is to help develop the environment 
in which research is done by developing new instruments, 
purchasing shared instrumentation, supporting more 
bioengineering research, and in other ways, enriching the 
environment for doing research.

                          prepared statements

    Finally, we want to recruit and train more effectively in 
all fields, providing a stable environment for performing 
research in which investigators have a reasonable chance of 
being supported over many years, increasing stipends for our 
trainees, encouraging transdisciplinary work, and doing a 
variety of other things that make it clear that science that 
benefits health is a very broad enterprise, which reaches from 
mathematics, computer sciences, and engineering, to medical 
research in the clinic.
    I would be pleased to answer any questions you might have 
about the specifics of the plans we entertain for this coming 
year.
    Thank you.
    [The statements follow:]
                 Prepared Statement of Harold E. Varmus
                         Office of the Director
    Mr. Chairman, Members of the Committee, we are pleased to be here 
today to discuss the fiscal year 1999 budget request for the Office of 
the Director (OD). As you know, the OD provides leadership, 
coordination, and policy direction for the overall extramural and 
intramural medical research activities across NIH, and for special 
programs specifically established within the OD. The office also 
provides management leadership and centralized support functions 
essential to the operations of the entire NIH.
    The President in his fiscal year 1999 budget has proposed that the 
OD receive $212.9 million, an increase of $11.8 million over the non-
AIDS portion of the fiscal year 1998 appropriation. Including the 
estimated allocation for AIDS in both years, total support proposed for 
the OD is $254.7 million, an increase of $13 million over the fiscal 
year 1998 appropriation. Funds for OD efforts in AIDS research are 
included within the Office of AIDS Research budget request.
    The NIH, as a federation of research Institutes and Centers, (or 
IC's), conducts a vast program of medical research with the goal of 
advancing medical knowledge to improve health. Furthermore, NIH aims to 
develop the complex infrastructure of facilities needed to conduct this 
research. Attainment of these goals results in improved health for all 
Americans, enhancing the quality of life for our citizens, and 
benefitting the Nation's economy.
    As has often been expressed during these hearings, NIH is in a 
position to achieve great strides in the prevention, diagnosis, and 
treatment of disease and has undertaken an ambitious program of medical 
research emphasizing such themes as genetics and neurosciences, new 
approaches to the origin and development of disease, and new prevention 
and treatment strategies. The OD mission is to provide the program 
means--policies, priorities, processes, and procedures--wherein the 
research IC's can conduct their activities in the core program areas of 
research, research training and career development, and support of 
research facilities. The OD provides a structure and framework for the 
conduct of the activities of the IC's in a manner that is responsive to 
promising research opportunities and technologies, yet addresses public 
health needs. Specifically, the OD guides and supports research by 
setting priorities; allocating funding among these priorities; 
developing science policies on the use of research subjects and 
materials; maintaining peer review processes; administering grant and 
contract award functions; communicating health information to the 
public; facilitating the transfer of technology to the private sector; 
and providing fundamental management and administrative services such 
as financial accounting and personnel, property, and procurement 
management, administration of equal employment practices, and plant 
management services, including environmental and public safety 
regulations of facilities. The principal OD offices providing these 
activities include the Office of Extramural Research (OER), the Office 
of Intramural Research (OIR), the Offices of Science Policy, 
Communications, Legislative Policy and Analysis, the Office of Equal 
Opportunity, and the Office of Management. This request contains funds 
to support the functions of these offices.
    To further influence research activities and to address targeted 
public health needs and specific components of medical research, the OD 
maintains several trans-NIH offices and programs that focus on a 
particular aspect of research and foster and encourage research in that 
particular area. These OD offices address a variety of health needs and 
research areas, including programs to improve the health of women and 
minority populations, the use of complementary and alternative (CAM) 
therapies, activities to examine the use of dietary supplements, 
research related to social and behavioral patterns in the maintenance 
of health, and efforts to promote research on rare diseases. I will now 
discuss the budget requests of these trans-NIH offices in greater 
detail.
   office of research on minority health and the nih minority health 
                               initiative
    Minorities at all stages of life suffer poorer health and higher 
rates of premature death than does the majority population. To address 
these disparities from a trans-NIH perspective, NIH established the 
Office of Research on Minority Health (ORMH) to promote medical 
research aimed at improving the health status of minority populations 
throughout their lifespan; and to expand the ability of minority 
scientists to participate in all aspects of medical research. As such, 
the budget request is in support of numerous collaborative activities 
with the IC's in the core program areas of research, and in research 
training and career development. Specifically, ORMH will support 
research activities by providing grant supplementation for research on 
diseases that disproportionately affect minorities, such as lupus, 
asthma, and hypertension.
    The NIH Minority Health Initiative (MHI) sponsors specific projects 
to develop therapies for sickle cell disease, address diabetes among 
Hispanics and Native Americans, and treatment for hypertension among 
Asian and African Americans, support initiatives to decrease injury and 
death due to violence in minority youth, reduce unintended pregnancy in 
minority women, and support initiatives to reduce infant mortality in 
inner city populations.
    Research training programs such as the Bridges to the Future 
program, the Minority International Research Training (MIRT) program, 
and the Comprehensive Partnerships for Mathematics and Science 
Achievement (CPMSA) program are also supported. The Bridges to the 
Future program links two-year colleges with four-year colleges offering 
baccalaureate degrees in science; while an M.S./Ph.D. component of the 
program links institutions with terminal master's degree programs with 
schools offering Ph.D.'s in science. These activities help to ease the 
transition for students as they pursue each higher level of their 
education. The MIRT program encourages minority students to continue to 
pursue careers in medical research by providing exposure to global 
medical research issues and concerns through links with foreign 
scientists at established domestic medical research centers and with 
research institutions located abroad. Finally, the CPMSA program 
provides standards-based math and science curriculum development, 
teacher training, and research experiences for students in the K-12 
sector to encourage young students to consider careers in science.
    In addition, the ORMH represents the program means that NIH 
maintains to stimulate and foster minority research activities among 
the IC's, and to evaluate these activities and assess attainment of NIH 
goals in the area of minority health. To this end, the ORMH sponsors a 
number of community outreach and review functions including the 
convening of advisory committee meetings, and support of workshops, 
conferences, caucuses, and symposia designed to promote and assess 
minority health issues. In this respect, I am happy to report the 
establishment of the Advisory Committee on Research on Minority Health 
as a standing committee to advise the Director, ORMH, and the NIH 
Director on medical research activities pertinent to minority health 
issues. The Committee will hold its first meeting in April 1998.
                      office of disease prevention
    Within the OD, the Office of Disease Prevention (ODP) has several 
program offices that strive to place new emphasis on the prevention and 
treatment of disease. Chief among these is the Office of Alternative 
Medicine (OAM). OAM pursues studies of improved disease management 
through evaluation of complementary and alternative medicine (CAM) 
therapies. In the United States, it is estimated that some 61 million 
Americans, spending an estimated $13.7 billion annually, use CAM to 
treat varied conditions, both for preventive and for treatment 
purposes. The OAM, using its own program announcements and requests for 
proposals, will solicit applications and proposals in several promising 
research areas, including osteoarthritis, cardiovascular disease, and 
drug addiction. The OAM will continue funding Clinical Research Centers 
that have been established jointly with the IC's for the purpose of 
conducting research on alternative and complementary medical 
modalities. The Centers sponsor a number of clinical trials including 
examining the efficacy of herbal products for treating HIV-associated 
anemia, uterine fibroids, and alcohol dependence; examination of the 
use of acupuncture for treating drug withdrawal and addiction, 
dysphasia in stroke, and postoperative pain after oral surgery. Also 
underway are trials of Ginkgo biloba to treat stroke and traumatic 
brain injury; trials investigating supplementation to the diet with 
garlic on plasma lipoproteins levels; and acupressure and massage 
therapy in the management of asthma. In addition, the OAM will further 
enhance its dissemination efforts with the expansion of databases of 
CAM topics. Finally, the OAM will continue to explore methods to 
improve investigation and validation of promising CAM therapies through 
collaborations with other Institutes and agencies that perform long-
term field studies.
    Continuing to pursue improved prevention methods, the Office of 
Dietary Supplements (ODS) stimulates research on the use of dietary 
supplements, particularly regarding health benefits and impact on 
disease prevention. The ODS will continue to support investigator 
initiated research protocols through Research Enhancement Awards 
Program (REAP) awards and joint program announcements with the ICD's. 
These address areas such as thaimine deficiency, use of vanadium salts 
and anti-folates; and protocols that investigate the effect of dietary 
supplements on antibiotic-induced hearing loss and loss of bone density 
in athletes. In the area of education and information dissemination, 
ODS will continue to maintain databases and Internet information pages 
to provide the public with information on such supplements, and to 
conduct conferences and workshops to encourage new research initiatives 
in this field.
    To address unrecognized public health needs, the ODP's Office of 
Rare Diseases develops and disseminates information on rare diseases 
and conditions and links investigators with ongoing research activities 
in this area. The ORD supports workshops and symposia to stimulate 
research interest and to identify research opportunities related to 
rare diseases. These workshops have resulted in a determination of 
research priorities, the development of research protocols, and 
criteria for diagnosing and monitoring rare disorders such as head and 
neck cancers, AIDS related malignancies, sleep control, hereditary 
ataxias, and unusual palsies and dysplasias. The results of these 
workshops are fully documented in a report on the outcomes of ORD 
sponsored scientific workshops and symposia to be provided to Congress.
       office of behavioral and social sciences research [obssr]
    The Office of Behavioral and Social Sciences Research (OBSSR) was 
established to address the role of health behaviors and social factors 
in the prevention and management of disease. The OBSSR increases the 
scope of, and support for, behavioral and social science across all of 
NIH. The office develops initiatives to stimulate research in these 
areas and to ensure that findings from this research are disseminated 
to the public. In one such initiative, the OBSSR, in collaboration with 
sixteen IC's and the American Heart Association, will sponsor an RFA on 
disease prevention through behavioral change that targets the risks of 
tobacco use, lack of exercise, improper diet, and alcohol abuse. 
Additionally, OBSSR plans to organize a trans-NIH initiative designed 
to fund research on the influence that socioeconomic factors have on 
health and disease.
              office of research on women's health [orwh]
    Responding to the health needs of women, the Office of Research on 
Women's Health (ORWH), as the focal point for women's health research 
at NIH, strives to ensure that NIH supported research addresses health 
issues of concern to women, that women are appropriately included as 
subjects in research protocols and clinical trials, and that women are 
encouraged to pursue careers in medical research. Working from a 
comprehensive research agenda that approaches women's health across the 
life span, ORWH will use its budget to stimulate, initiate, and expand 
women's health research by supporting research grants, RFA's, PA's, and 
REAP Awards in priority areas identified during public hearings and 
workshops held during the ORWH conferences: Beyond Hunt Valley: 
Research for the 21st Century. These efforts will be focused in the 
following areas: diabetes prevention, Hormone Replacement Therapy and 
lupus, arthritis and chronic pain, heart disease, alcohol and drug use, 
reproductive health, and urologic and kidney conditions.
                          other od activities
    In addition to the offices previously mentioned, the OD sponsors a 
number of additional NIH programs that promote scientific research and 
enhance research career development.
    The OER coordinates the Academic Research Enhancement Award (AREA) 
program that provides grants to institutions that award degrees in 
health sciences but are not major recipients of NIH grant funds. These 
awards enable students to participate in a research project and 
encourage them to the possibility of careers in medical research. OER 
also sponsors the Extramural Associates Research Development Award 
(EARDA) program that provides competitively awarded grants to 
institutions that offer medical research programs but have a 
significantly under represented minority enrollment. The grants are 
designed to provide faculty at these institutions with skills needed to 
become more competitive in obtaining Federally sponsored research 
funds.
    The NIH, through the Office of Intramural Research (OIR), maintains 
loan repayment and scholarship programs as important instruments for 
recruiting high quality candidates in basic and clinical research 
positions. The request contains funds for the NIH Clinical Research 
Loan Repayment Program and the Undergraduate Scholarship Program, both 
for individuals from disadvantaged backgrounds; and for the Loan 
Repayment Program for General Research. Each program provides for the 
payment of educational costs in return for specific commitments of 
service in NIH's intramural research facilities.
    The Office of Science Policy coordinates several science education 
activities that benefit both students and teachers and encourage 
students to consider careers in research.
    The request also contains funds to support the Foundation for the 
National Institutes of Health to facilitate its transition to a self-
sufficient entity able to support the mission of NIH through funds 
which the Foundation raises from private sources. Limitations are to be 
placed on the use of these appropriated funds, and their availability 
is contingent upon certification of a plan for self-sufficiency of the 
Foundation by the Secretary.
    The request also includes funds for a Discretionary Fund to permit 
the Director to respond to new and emerging high priority research 
opportunities such as vaccine study, gene mapping and imaging.
                    women's health initiative [whi]
    We are proposing to transfer the Women's Health Initiative (WHI) to 
the NHLBI, where it will function as a consortium among NHLBI, NCI, 
NIA, and NIAMS. We believe that by placing the WHI in an Institute, we 
can provide the best opportunity for success as it operates as a large-
scale research project similar to others in the Institute. We recently 
conducted a detailed review of the WHI programs and contract costs in 
preparation for this transfer, and found that recruitment efforts had 
to be expanded beyond the original levels, special efforts to retain 
enrollees had to be put in place and increased emphasis on studying 
minority women was necessary. Expanding the sample size by 10,000 was 
necessary to ensure that we had participation from women of all 
demographic groups. But these increased recruitment and retention costs 
can noticeably diminish the financial resources for the other study 
components, and increasing the sample size will also increase the costs 
for follow-up. Therefore, an increase of $13.4 million is being 
requested by the NHLBI as a way to bring the WHI operation in-line with 
the long-standing program objectives. This increase is requested in the 
NHLBI budget along with the original funding request for the WHI.
                        management improvements
    Seeking to maximize administrative effectiveness, NIH, at the 
request of the Subcommittee, undertook a comprehensive review of the 
agency's administrative structure and costs to document the 
effectiveness of current practices and identify areas for future 
improvements. After considering the major recommendations that emerged 
from this review, we will focus implementation efforts on a number of 
high priority areas including: accounts payable; property management; 
personnel delegations; procurement; an automated time and attendance 
system; and information technology management. In addition, an overall 
assessment of security services will be initiated. Other initiatives to 
be pursued include better management of the decentralized delivery of 
administrative services; strengthening the partnership between the 
scientific and administrative staff; and establishing increased 
administrative accountability throughout the NIH. In addition, in 
response to Subcommittee concerns, the NIH is initiating review of 
regulations governing the conduct of extramural scientific research in 
an effort to identify and alleviate any unnecessary administrative 
burden these regulations may impose.
    The fiscal year 1999 budget request for the Office of the Director 
is $212.949 million. I will be pleased to answer questions.
    The activities of the OD are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
                        buildings and facilities
    I am pleased to present the President's budget request for the 
Buildings and Facilities (B&F) Program. The President in his fiscal 
year 1999 budget has proposed that the B&F receive $218.9 million, an 
increase of $12 million (or 5.8 percent) over the fiscal year 1998 
appropriation. Including the estimated allocation for AIDS, total 
support proposed for B&F is $225 million, an increase of $18 million 
(or 8.7 percent) over the 1998 appropriation. Funds for B&F efforts in 
AIDS research are included within the Office of AIDS Research budget 
request.
                role in the biomedical research mission
    The B&F Program plays an essential role in supporting the 
biomedical research mission of the NIH and has a critical and exciting 
impact on shaping and defining the NIH campus. The Buildings and 
Facilities appropriation provides funds for the design, construction, 
improvement, and major repair of clinical, laboratory, and office 
buildings, as well as supporting facilities, essential to the mission 
of the NIH.
                              master plan
    Armed with an updated master plan that was approved by the National 
Capital Planning Commission (NCPC) in February 1996 for the Bethesda 
campus, the NIH is moving forward with a new blueprint to guide future 
development on the campus. The new comprehensive master plan identifies 
programmatic requirements in terms of personnel and physical 
facilities; establishes concepts for future development and land use, 
buildings, utilities, open space, circulation and traffic management 
for the next twenty years; and illustrates how needs for laboratory and 
clinical research, administrative, and support space can be 
accommodated. An updated Master Plan for the NIH Animal Center in 
Poolesville was completed in the Fall of 1996.
    The NIH is, however, challenged with an aging, deficient physical 
plant. The majority of the infrastructure systems are 20 to 40 years 
old and beyond their design life. To address this problem, which has 
major occupational and environmental safety implications, two major 
strategies have been put in place. First, NIH has integrated all 
corrective construction programs into a comprehensive Facilities 
Revitalization Program. Its objective is to support laboratory and 
clinical research by providing safe, functional, modern, and adaptable 
facilities that are program effective and cost efficient over their 
expected life. The second strategy is the upgrade of the NIH utilities 
infrastructure, most of which is obsolete, beyond its useful life, and 
needed to meet the demands of modern research.
               mark o. hatfield clinical research center
    In recent years, the NIH has placed the highest priority on the 
renewal of the Clinical Center (CC) hospital and related research 
laboratories. Ever since its construction in 1953, the CC has been the 
core of the Intramural Program, the training site for thousands of the 
nation's biomedical scientists, and home for the most prestigious 
clinical research program in the world. The power of this program is 
intimately linked to the diversity and quality of laboratory sciences 
present on the NIH campus, especially those practiced in space 
immediately adjacent to the clinical wards. With nearly half of the 
country's research beds, a large ambulatory care research unit, a 
coordinated training program, and over 1,000 protocols conducted with 
patients from throughout the nation and the world, the CC has fostered 
important work on diseases ranging from the well-known (e.g., cancer 
and AIDS) to the rare and obscure.
    The Clinical Center complex contains approximately 40 percent of 
the laboratory research space on the Bethesda campus, and about one 
half of the federally supported research beds for clinical research. 
However, the utility systems within the complex are deteriorated, 
outmoded, obsolete, and insufficient to support modern research. 
Numerous distinguished review groups, including the U.S. Army Corps of 
Engineers and the External Advisory Panel established by the Congress 
and chaired by Drs. Paul Marks and Gail Cassels, have confirmed the 
increasingly dangerous deficiencies in the physical condition of the 
existing Clinical Center and proposed the construction of a new 
research hospital. More recently, the DHHS Secretary's review of the 
Clinical Center confirmed the recommendation for a new facility and 
noted that its proposed operational changes can only be fully realized 
in a building with a modern design. In accordance with the advice of 
the Marks-Cassell Panel, the Administration and the Congress has 
supported the NIH plan to design and construct what is now the Mark O. 
Hatfield Clinical Research Center (CRC), a state-of-the-art research 
hospital with 250 beds, allied clinical facilities, and adjacent 
research laboratories for work that is closely intertwined with patient 
research activities, a traditional strength of the existing CC. It will 
be located to the North of the existing Building 10 complex and 
ambulatory care research building. The research hospital will be 
approximately 600,000 gross square foot (gsf) and will be served by an 
additional 250,000 gsf of new space dedicated to laboratory and program 
support. It is estimated that construction for the new CRC will take 
five years to complete and will be ready for occupancy in 2002.
    Funds provided in the fiscal year 1995 appropriation of $2,500,000 
were used to investigate and evaluate different project development 
approaches and design options for the new facility. They were also used 
to pay for a design concept competition. The CRC project was initially 
funded in fiscal year 1996 when funding of $23 million was provided for 
architecture and engineering design and design development for the 
project. The fiscal year 1997 and fiscal year 1998 B&F appropriations 
included $90 million in each fiscal year for the construction portion 
of the Mark O. Hatfield Clinical Research Center. In accordance with 
the intent of Congress, the project is being planned at full scope to 
completion. The fiscal year 1999 request of $90 million will continue 
the course of the project. The total planned budget for design and 
construction of the CRC is $333 million. The proposed appropriations 
language specifies $90 million for fiscal year 1999 and requests 
advanced appropriations for $40 million in fiscal year 2000 for the 
construction of the CRC, which will remain available until expended.
    The CRC is currently being fast-tracked, i.e., as segments of the 
project design are completed, the construction will start while the 
remaining design is being developed. Since September 1997, site 
preparation work for the CRC has been underway. This includes 
demolition of existing structures on the site of the CRC; modification 
of the existing south entrance to the Clinical Center to facilitate 
construction of the new CRC on the north side of the Clinical Center; 
and relocation of utilities and roadways. In the next year and a half, 
significant progress will be made: the design will be fully completed; 
the site preparation will be substantially completed; and the building 
foundation and structure will be in place.
                          hiv vaccine facility
    Another highlight of the fiscal year 1999 request for B&F is 
funding for the construction of an HIV Vaccine Facility. With President 
Clinton's announcement of another important new NIH AIDS vaccine 
initiative in May 1997, the NIH is moving forward to develop a Vaccine 
Research Center (VRC). The VRC will bring together in a single location 
scientists engaged in all aspects of vaccine research, integrating 
modern immunological science with detailed understanding of the 
pathogenesis of HIV infection, development of immunogens and vectors, 
and new approaches to vaccination. The VRC will be housed in a Vaccine 
Facility which has been initiated with $17 million appropriated in 
fiscal year 1998 to accelerate design and begin construction. Funding 
to complete construction of the Vaccine Facility, totaling $9.1 
million, is included in the fiscal year 1999 B&F budget request of $3 
million and $6.1 million made available in the Office of AIDS Research 
request.
                essential safety and health improvements
    The NIH continues to place a high priority on the essential safety 
and health requirements of its facilities. In addition to the CRC, the 
Essential Safety and Health Improvements initiatives address the 
infrastructure upgrades to existing NIH facilities to meet critical 
occupational and environmental requirements to protect and support 
ongoing research programs, including the safety and health of NIH 
employees and patients. Supporting utilities need to be modernized and 
improved in order to meet safety and health requirements in support of 
the NIH research mission.
    The Infrastructure Modernization Program (IMP), initiated in fiscal 
year 1991, is in the final year of a nine-year program to replace and 
expand central utility equipment and distribution systems. A critical 
situation had developed where sufficient and uninterrupted services to 
research and patient care activities could not be ensured due to 
obsolete, deteriorated systems, overburdening from growth, and 
increasing program requirements. The IMP is critical to ensure the 
infrastructure capability to carry out the NIH mission and remove the 
possibility of a catastrophic failure of the central utility and 
distribution systems. This request includes funds to complete 
construction of the central power plant expansion that will house 
equipment such as secondary pumping apparatus, several chillers, and 
areas for maintenance and spare parts.
    Other funds included in the fiscal year 1999 request for the 
Essential Safety and Health Improvements initiatives are for; the 
systematic and phased removal of asbestos-containing materials from 
various NIH buildings; the implementation of the plan to correct fire 
and life safety deficiencies in NIH buildings on the campus and at the 
NIH Animal Center; the elimination of barriers to persons with 
disabilities; a multi-year program to address indoor air quality 
concerns at NIH facilities; the modernization of Building 6; the 
construction of the upgrade of the utility infrastructure at the NIH 
Animal Center, Poolesville; the ongoing rehabilitation of NIH animal 
research facilities; and initiation of the environmental assessments/
remediation program. All of these projects are driven by federal and 
local regulations, policies and national accreditation requirements.
                     repair and improvement program
    The Repair and Improvement (R&I) program represents essential 
ongoing preventive maintenance, and major repairs and rehabilitation/
upgrades to the physical plant that supports the main NIH campus in 
Bethesda, as well as to field stations that are the responsibility of 
the NIH. The R&I program covers projects of a recurring nature 
including roofs, roads, structures, and building utilities, as well as 
other projects that are unpredictable, and are one-time occurrences 
that require immediate attention that are critical to the continuing 
operation of our research facilities.
                    renovations and system upgrades
    This fiscal year 1999 B&F request also provides funds for the 
renovation of the basement of Building 30; safety upgrades within 
Building 37; and upgrades to NIEHS mechanical systems.
                    fiscal year 1999 budget summary
    The fiscal year 1999 request for Buildings and Facilities is $218.9 
million. The request is highlighted by $90 million for the Mark O. 
Hatfield Clinical Research Center, the third of four planned funding 
increments to complete construction; and $3 million to complete 
construction of the Vaccine Facility to house the VRC. The NIH, through 
the Office of AIDS Research budget request, has also made available 
$6.1 million in the fiscal year 1999 to support the Vaccine Facility 
project. The request totals $55.1 million for essential safety and 
health improvements composed of $7.5 million for the final year of 
funding of the site infrastructure modernization program at the NIH; 
$5.5 million for the phased removal of asbestos from NIH buildings; $3 
million for the continuing upgrade of fire and life safety deficiencies 
of NIH buildings; $500,000 for the elimination of barriers to persons 
with disabilities; $1.5 million for implementation of an indoor air 
quality improvement program; $8.8 million for the modernization of 
Building 6; $16 million for the construction of the upgrade of the 
utility infrastructure at the NIH Animal Center, Poolesville; $11.3 
million to continue the rehabilitation of animal research facilities; 
and $1 million to initiate a program of environmental assessments and 
remediation. In addition to the essential safety and health 
improvements, the fiscal year 1999 request includes: renovation 
projects amounting to $4.4 million for the basement of Building 30; $17 
million for the mechanical/life safety upgrades to Building 37; and 
funding of $9.1 million to upgrade mechanical systems at NIEHS. The 
fiscal year 1999 request also includes $40.2 million for the continuing 
program of repairs, improvements, and maintenance that is the true 
keystone of the B&F program.
    My colleagues and I will be happy to respond to any questions you 
may have.
                                 ______
                                 
                Prepared Statement of Jack Whitescarver
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the AIDS research programs of the 
National Institutes of Health for fiscal year 1999, a sum of 
$1,730,796,000, an increase of 7.7 percent above the comparable fiscal 
year 1998 appropriation.
    The activities of the OAR are covered by the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and linked to the HHS GPRA 
Strategic Plan that was transmitted to Congress on September 30, 1997. 
The OAR is anxious to meet the challenges set forth in this plan, and 
we look forward to continued support from Congress that will facilitate 
our achieving these goals.
    The role of the Office of AIDS Research (OAR) is to plan, 
coordinate, and evaluate NIH AIDS research and to develop this budget 
request, assuring that the nation's investment will be used to address 
the most compelling scientific opportunities and priorities that will 
lead to better therapies and prevention for HIV infection and AIDS.
                   aids epidemic in the united states
    If I were to summarize where we stand after 16 years of pitched 
battle against the AIDS pandemic, I would say, with apologies to 
Charles Dickens, that it is the best of times; it is the worst of 
times. Here in the United States, remarkable research progress has 
brought about longer and better quality of life for many HIV-infected 
individuals. New combination therapies of protease inhibitors and other 
antiretroviral drugs can reduce the amount of virus in the blood to 
undetectable levels. Death rates, hospitalization, and rates of new 
infections are decreasing in many populations. Drug regimens have 
dramatically reduced the number of infants born with HIV.
    But even here in the United States, the news is not all good. The 
new drugs are not a silver bullet. We do not know how long their 
benefit will last or whether immune function of treated individuals can 
be restored without additional interventions. There are many for whom 
the new drug regimens have not been effective or for whom the side-
effects are not tolerable. We are now beginning to identify adverse 
metabolic effects that may be the result of long-term use of 
antiretroviral therapies. Drug-resistance and the transmission of drug-
resistant HIV is a very dangerous reality. And many patients, 
particularly in our minority communities, simply do not have the means 
to access these life-extending therapies.
    AIDS is actually a series of individual epidemics, and although 
overall statistics are down in the U.S., the epidemics in many groups 
are increasing. AIDS cases continue to rise among women and minorities 
in our country. According to the CDC, in 1996 new AIDS cases increased 
by 19 percent among heterosexual African American men; 12 percent among 
heterosexual African American women; 13 percent among Hispanic men; and 
5 percent among Hispanic women. CDC recently announced that AIDS is on 
the increase in another group in our nation--people over 50 years of 
age. Since 1991, AIDS cases in the 13 to 49 age group increased 9 
percent; but cases in people over 50 increased 22 percent during that 
same time.
                           worldwide pandemic
    The news around the world is far worse. The World Health 
Organization and the Joint United Nations Programme on HIV/AIDS 
(UNAIDS) recently released new data demonstrating that the deadly march 
of the pandemic had been underestimated. They now estimate that 2.3 
million people died of AIDS in 1997--a 50 percent increase over 1996. 
Nearly half of those deaths were among women, and nearly half a million 
were children under 15 years of age. The total number of people living 
with HIV and AIDS worldwide has been revised upward to more than 30 
million adults and children, with 16,000 new infections each day. WHO 
estimates that more than 90 percent of people with HIV live in the 
poorer countries of the globe, as the epidemic continues its unabated 
spread through Africa, Asia, and now Eastern Europe.
    Thus, we face two great dichotomies in our progress against AIDS. 
One, the disparity that exists even among different populations within 
our own country; and the disparity that is exponentially greater 
between the industrialized and the developing worlds.
               nih comprehensive research plan and budget
    The NIH AIDS research program is addressing these unacceptable 
dualities with a comprehensive research plan and budget that balances 
the need for new therapies that are more effective, less expensive, and 
in less complex dosage regimens with the need for a safe and effective 
vaccine that can be used worldwide. To gain the most expert advice and 
to achieve scientific consensus on the goals and objectives to be 
achieved, the OAR has established a unique and collaborative planning 
effort involving hundreds of individuals: NIH Institute Directors, 
scientists and program staff; non-government experts, including 
scientists from academia, foundations, and industry; and AIDS community 
representatives. The plan itself is unique in that it serves as the 
framework for the development of the budget and defines those research 
areas for which AIDS- designated funds may be allocated.
                     implementing the levine report
    The plan has also been shaped by the recommendations of the Levine 
Report, the comprehensive evaluation of the NIH AIDS research program. 
The recommendations of this landmark Report have had a lasting effect 
on almost every aspect of the AIDS research program--in setting the 
scientific agenda, refocusing priorities, and shaping the AIDS research 
budget. The report has had a profound impact in helping to establish 
the appropriate balance within the AIDS research program in two 
critical areas. The first area is the balance between investigator-
initiated research grants and targeted, directed science. Before 
embarking on the evaluation process, OAR already had identified the 
need to place greater emphasis on investigator-initiated science and to 
increase the proportion of funding devoted to basic research. The 
Levine Report confirmed these priorities. Between fiscal year 1994 and 
this budget request, OAR has increased the number of new and competing 
research grants by 50 percent, thus encouraging innovation from a wider 
group of investigators.
    The second area of impact is the balance between research to 
develop treatments for those who are already infected and research to 
prevent infection. Vaccine research is a key priority of the Levine 
Report, and a specific challenge from the President. This budget 
request reflects an unprecedented commitment to this critical area of 
research. NIH has taken a number of steps to move the science in this 
area forward. Nobel Laureate David Baltimore now serves as chair of the 
NIH AIDS Vaccine Research Committee providing leadership and guidance 
to this effort. A new program of ``innovation grants'' was initiated by 
that Committee. A new center is being established on the NIH campus 
devoted to vaccine research with an AIDS vaccine as its first major 
goal.
    The Levine Report also challenged NIH to develop a Prevention 
Science Agenda. OAR established a Prevention Science Working Group that 
has established other priority areas of prevention research, including 
topical microbicides and other female-controlled barriers, treatment 
and prevention of sexually transmitted diseases, and prevention of 
mother-to-child transmission.
    NIH programs are pursuing the search for newer and better drugs and 
therapeutic regimens with increased potency, less complicated treatment 
regimens, and fewer toxic side effects. The second generation of 
protease inhibitors is now in development and moving rapidly through 
the drug development pipeline. NIH-sponsored researchers, in 
collaboration with industry, are working to identify, design, and 
evaluate new agents that interfere with other targets in the HIV life 
cycle with the goal of inhibiting HIV infection, disease progression, 
and transmission. NIH clinical trials will continue to identify and 
evaluate the most effective ways to use these drugs in combination.
              benefits of aids research to other diseases
    Mr. Chairman, the nation's investment in AIDS research is also 
providing major benefits in our ability to understand and treat a wide 
spectrum of other infectious, malignant, neurologic, autoimmune and 
metabolic diseases. For example, the drug known as 3TC, developed to 
treat HIV infection, now has been shown to be the most effective 
therapy for chronic hepatitis B infection. The drugs developed to 
prevent and treat many of the opportunistic infections in HIV-infected 
patients also promise real benefit to those undergoing cancer 
chemotherapy or receiving anti-transplant rejection therapy. 
Researchers recently published a report suggesting that there is a link 
between the Kaposi's sarcoma-associated virus and multiple myeloma, a 
blood cancer. This finding may lead to new treatments or a vaccine, and 
additional information about the link between viruses and cancer. And, 
the study of the immune systems of HIV-infected individuals is 
providing new insight into changes that occur during the normal aging 
process.
    In a very real sense, AIDS has also revolutionized the way that we 
conduct research at the NIH for all diseases, empowering patients, 
particularly women and minorities, to participate in clinical trials 
and in the design and implementation of research protocols. This is 
progress that also will benefit people with all diseases and disorders.
    In closing, I would like to return to ``A Tale of Two Cities,'' 
Dickens' story of the French Revolution, and read from its famous first 
sentence: ``It was the best of times, it was the worst of times; it was 
the age of wisdom, it was the age of foolishness; it was the epoch of 
belief, it was the epoch of incredulity; it was the season of Light, it 
was the season of Darkness; it was the spring of hope, it was the 
winter of despair * * *.'' For those of us in the battle against this 
awful disease, that quote captures the roller-coaster of emotion. There 
is darkness and light. There are advances and then new problems. We 
cannot be complacent because death rates are down. We have succeeded in 
keeping some people alive longer, but we are already seeing the many 
limitations of the new therapies. The epidemic has brought about a 
revolution in science and in public health, but the battle is far from 
over.
    The budget authorities provided to the Office of AIDS Research, 
that allow us to direct resources to the most important scientific 
priorities, are even more critical today as these opportunities 
constantly change. The Nation has invested major resources in the NIH 
AIDS research program. I believe that the steps taken by OAR over the 
past few years and the scientific progress that has been made, 
demonstrate that the Nation's investment is indeed well spent. We are 
grateful to the Committee for your continued support for AIDS research.
    My colleagues and I would be pleased to respond to any questions 
you may have.
                                 ______
                                 
               Prepared Statement of Richard D. Klausner
    Mr. Chairman and Members of the Committee: I am pleased to appear 
before you for the third time as Director of the NCI. The President in 
his fiscal year 1999 budget has proposed that the NCI receive $2.536 
billion, an increase of $215 million (or 9.27 percent) over the non-
AIDS portion of the comparable fiscal year 1998 appropriation. 
Including the estimated allocation for AIDS, total support proposed for 
NCI is $2.776 billion an increase of $229 million (or 8.99 percent) 
over the fiscal year 1998 appropriation. Funds for NCI efforts in AIDS 
research are included within the Office of AIDS research budget 
request. This will allow us to both continue and accelerate the 
progress I believe that we are making.
    Last year, we reported what we believed to be a historic 
observation--the first sustained, significant decrease in cancer 
mortality rates since such statistics were collected in the 1930's. We 
agreed then, in collaboration with the American Cancer Society and the 
National Center for Health Statistics of the Centers for Disease 
Control and Prevention, to issue an annual report card on cancer 
statistics. This year's report card, using numbers updated through 
1995, was presented at a press conference on Thursday, March 12, and I 
can tell you that the encouraging trends continue. This year, we have 
added incidence trends as well. From 1973 to 1990, overall cancer 
incidence rates increased by 1.2 percent per year. Since 1990, they 
have decreased by 0.7 percent per year. This drop includes three of the 
most common cancers: lung, colorectal, and prostate. Breast cancer 
rates, after increasing by 1.8 percent per year, are now flat. Non-
Hodgkin's lymphoma had been rising at the extraordinary rate of 3.5 
percent per year. While it is still rising at 0.8 percent per year, the 
slowdown in the rate of increase is significant.
    Likewise, overall death rates continue to decrease by 0.5 percent 
per year, after rising 0.4 percent per year. For white males, this drop 
is 0.9 percent per year, while for black males, the mortality rate drop 
is 1.3 percent per year. Quite significant changes in incidence, 
mortality and pattern of disease rates for prostate cancer, the most 
common cancer in men, are currently being carefully analyzed. 
Overwhelmingly, due to the continuing increase in tobacco-related 
cancer deaths for women, the drop in their mortality rates is less than 
for men, 0.1 percent per year in whites and by 0.2 percent per year in 
blacks. Not captured by the above statistics are prolonged survival and 
improved quality of life for many of the millions of cancer survivors 
in this country.
                         control and prevention
    This year, I received reports from two outstanding blue ribbon 
panels advising the Institute on critical opportunities and needed 
approaches in cancer control and cancer prevention. We are now engaged 
in implementing the many recommendations of these groups, expanding our 
activities in these areas. Our response has included the formation of 
two newly configured divisions of the National Cancer Institute, the 
Division of Cancer Prevention and the Division of Cancer Control and 
Population Sciences. These new divisions will strengthen our efforts in 
both cancer prevention and cancer control. This past year, in cancer 
prevention, we completed the accrual of 13,000 women at increased risk 
of developing breast cancer to a critical clinical trial to determine 
whether the anti-estrogen, tamoxifen, can actually prevent this 
disease. The development of new so-called ``designer estrogens'' is 
creating new possibilities for very selective hormone manipulation for 
cancer prevention and we are actively evaluating clinical trials to 
examine this. The NCI is currently sponsoring 85 chemoprevention trials 
for breast, colorectal, lung, prostate and other cancers, a growing 
number of these based upon a real understanding of the mode of action 
of the interventions. Twenty-five new prevention trials are to be 
implemented over the next year.
    Identifying populations and individuals at high risk for cancer is 
a growing focus of the NCI. The Cancer Genetics Network, will involve 
eight different centers throughout the U.S. The goal is not only to 
identify new genes that predispose to cancer but also to learn better 
ways to counsel people, help them cope with the sequelae of genetic 
testing, and apply cancer prevention and early detection strategies in 
high risk individuals. Evaluating the efficacy of surveillance and 
prevention in high risk groups is the subject of several initiatives. 
One such population is the 8-9 million cancer survivors in the U.S. who 
are at an increased risk for the development of second cancers. In 
fiscal year 1998, we have invested five million new dollars to put in 
place a growing research portfolio under the coordination of our Office 
of Cancer Survivorship to address the many issues facing this 
population. Our goals include not only decreasing the risk of second 
cancers but also improving quality of life among our survivors.
                          incremental advances
    Advances in treatment often are incremental and they take time to 
have an effect on cancer mortality. It is this incremental progress 
that, in part, explains the mortality trends for numerous cancer sites. 
We have had few dramatic therapeutic breakthroughs in cancer research. 
We have, however, developed a clinical trials system to test and 
optimize often complex therapies. Over the past 12-24 months, we have 
completed clinical trials that have established new standards of 
optimal therapy for women with node-negative and locally advanced 
breast cancer, for women with advanced ovarian cancer, for patients 
with nasopharyngeal cancer, for melanoma, and for childhood renal 
cancer.
    A major explanation for the incremental nature of progress in 
treatment is that, with the exception of hormonal manipulation, our 
therapies have not been designed to target the machinery of cancer. 
This brings me to focus on dramatic changes in the National Cancer 
Program.
                           fruits of research
    Thirty years ago, Peyton Rous in his Nobel Lecture said, ``Tumors 
destroy man in a unique and appalling way, as flesh of his own flesh 
which has somehow been rendered proliferative, rampant, predatory and 
ungovernable * * * yet despite more than 70 years of experimental 
study, they remain the least understood * * * What can be the why for 
these happenings?'' Three decades later, Dr. Rous would be amazed. With 
dizzying speed and growing precision, we are mapping the inner workings 
of the tumor cell, explaining how it behaves and how it assures an 
accepting and nurturing host. The black box cell of Dr. Rous seen in 
Figure 1 is being replaced by the intricate circuitries of Figure 2. 
The cancer genes so frequently reported in the news are altered relays 
in this circuitry. Viruses, carcinogens and radiation all act by 
altering one or more of these specific pathways. Each circuit suggests 
a rational target for prevention or therapy of cancer as shown in 
Figure 3. Dozens are being developed. Ten years ago, 60 drugs were 
entering clinical trials for cancer. Today, that number is about 320.
    Let me illustrate one. Thirty-five percent of breast cancers 
overexpress a protein called HER-2, a crucial link in one of these 
growth-controlling circuits. These cancers tend to be more aggressive, 
and clinical trials have shown that women with such cancers require 
more intensive therapy to achieve the same outcome as women with tumors 
that do not overexpress HER-2. Last December, Genentech announced the 
results of the first clinical trial using an agent targeted 
specifically to HER-2. That agent, when added to taxol, showed a 
clinical response rate three times greater than with taxol alone in 
women with advanced metastatic breast cancer. New clinical trials will 
rapidly build on this result for breast and other cancers that 
overexpress this cancer gene, such as a proportion of ovarian and lung 
cancers.
    In one of the more exciting tests of our new knowledge of cancer 
biology, we now know that altered circuits in cancer cells result in 
the production of molecules that stimulate the growth of blood vessels 
that nourish the growing tumor. Without these, the tumor will die or 
never grow beyond a microscopic size. Over the next year, we plan to 
have the first potent anti-angiogenesis agents into clinical trials for 
cancer. Knowledge about these cancer circuits will profoundly affect 
our approach to therapy although I believe they will also have a major 
impact on prevention.
                             the challenge
    To maintain this remarkable momentum of discovery, with the 
President's budget proposal, we can continue to increase the success 
rate for the funding of individual investigator-initiated research. We 
will continue to build on the infrastructure of the Cancer Genome 
Anatomy Project, which I introduced to you last year, to speed the 
discovery of the pieces of the machinery of cancer and especially to 
give us new molecular tools for early detection. This year, we will add 
to that project by beginning to catalog the natural variations in genes 
which will likely explain why different individuals respond to 
environmental, genetic and other causes of cancer so differently. This 
proposed budget will allow us to support a number of new initiatives 
which are aimed at bridging the gap between the explosion of 
discoveries in basic science and the need to translate these advances 
to our ultimate goal of reducing the burden of cancer for people.
    Among these are:
  --Develop chemistry-biology centers to capture revolutionary new 
        approaches to the generation of millions of small molecules and 
        to couple this with so-called ``smart assays'' in order to 
        target these newly defined cancer circuits.
  --Build a new program for Rapid Access to Interventional Development, 
        or RAID, which will allow the best new preclinical ideas in 
        cancer intervention from investigators throughout the country 
        to become available for clinical testing in an accelerated way.
  --Build a re-designed, informatics-based clinical trials system to 
        expand access to prevention, detection and treatment trials, to 
        improve the speed and value of the trials and to allow the 
        growing number of compelling ideas to be rapidly tested.
  --Build a new imaging research network to rapidly evaluate emerging 
        technologies in tumor imaging, both for early detection and 
        staging and for image-guided therapy.
  --Fund new clinical training pathways and fund mid-level and senior 
        clinical investigators to protect their time to engage in both 
        clinical research and mentoring.
  --Improve our cancer surveillance system so we have a better 
        understanding of the burden of cancer and where we need special 
        efforts to control cancer.
    The activities of the NCI are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    I will be happy to respond to any questions you may have.
                                 ______
                                 
                  Prepared Statement of Claude Lenfant
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the National Heart, Lung, and Blood 
Institute (NHLBI) for fiscal year 1999, a sum of $1,646.8 billion, an 
increase of $124.3 million above the comparable fiscal year 1998 
appropriation. Total support proposed for AIDS is $68 million, an 
increase of $4.4 million over the 1998 appropriation. Funds for NHLBI's 
efforts in AIDS research are included within the Office of AIDS 
research budget request.
    This year, it is a particular pleasure to appear before the 
Committee. The NHLBI is celebrating its 50th anniversary, and we have 
much reason to be proud of our past and optimistic about our future. 
Since it passed the National Heart Act in 1948, the Congress has 
appropriated more than $23 billion in support of this remarkable 
enterprise. I want to thank you--and the American taxpayers--for this 
support and to tell you how richly rewarding this public investment in 
medical research has proven to be.
                             nhlbi's impact
    When the Institute was founded 50 years ago, our nation was in the 
throes of an epidemic of heart disease, as indicated by the vital 
statistics data shown in Chart 1. Beginning at the turn of the century, 
and particularly after the end of World War I, heart disease death 
rates increased steadily among women and quite precipitously among men. 
It seemed that there was no end in sight for this alarming trend, 
because we were quite ignorant about the causes of heart disease and 
extremely limited in our ability to treat or prevent it. Heart disease 
was an implacable and inexorable threat to the public health.
    Who would have believed that this situation could be turned around 
in such a short period of time? But in fact, it has been, as can be 
seen in Chart 2, which extends the previous vital statistics data to 
the present time. Heart disease death rates among men are now about 
where they were 100 years ago, and among women they are 37 percent 
lower. Progress against coronary heart disease has been especially 
noteworthy. Not only do we have lifesaving treatments for heart 
attacks, but we are able to prevent many of them from occurring--or at 
least postpone them until old age.
    The same is the case with strokes, for which death rates have 
plummeted, due in great measure to improvements in detection and 
treatment of high blood pressure. The National Center for Health 
Statistics estimates that the average American can expect to live 5\1/
2\ years longer today than was the case even 30 years ago and, as Chart 
3 indicates, nearly 4 years of that gain in life expectancy can be 
attributed to our progress against cardiovascular diseases, including 
coronary heart disease and stroke.
    Our assault on diseases that affect the very young has been equally 
vigorous and effective. For instance, the past 50 years have witnessed 
unprecedented improvements in the outlook for the 40,000 children born 
each year with congenital heart disease. In the 1940's, autopsies were 
virtually the sole means of identifying these congenital defects; now 
we can diagnose them in utero. Fetal diagnosis allows optimal medical 
management of children who may require life-saving surgery before they 
are a week old. The understanding of fetal and infant physiology, and 
the development of techniques to perform surgery safely on infants 
weighing as little as 3 pounds, allows many curative surgical 
procedures to be performed in infancy on children who, in the past, 
would have either died or lived very limited lives.
    Neonatal respiratory distress syndrome, which as recently as 1970 
claimed the lives of 10,000 newborns annually, is now responsible for 
fewer than 1,400 deaths each year, according to vital statistics. 
Children with inherited diseases of the lungs and blood, such as cystic 
fibrosis, sickle cell disease, and Cooley's anemia, which used to claim 
their victims in childhood, can now expect to live well into adulthood.
    As you know, the Institute's mandate has encompassed blood safety 
issues for the past 25 years. Here again, our research programs have 
paid off richly, not only in terms of reducing human suffering but also 
in terms of reducing health care costs. For example, in 1970 the chance 
of contracting hepatitis through a blood transfusion was 23 percent, as 
shown in Chart 4. This risk decreased substantially in subsequent years 
as a result of various measures taken to exclude high-risk blood donors 
and test blood for infectious agents, and is now close to zero, 
according to data recently published in the journal Clinical Chemistry. 
The most recent innovation, a highly sensitive anti-hepatitis C test 
implemented in 1992, is estimated to have prevented 33,310 cases of 
hepatitis annually, resulting in savings of $323 million in health care 
costs.
                        promising research areas
    As a result of the scientific discoveries and new research 
approaches developed during its first 50 years, the NHLBI is now poised 
to make a quantum leap in our understanding of many basic issues that 
govern health and disease. Let me describe several broad themes that 
are ripe for exploration in the near future.
    One area of considerable interest, because it cuts across 
cardiovascular, lung, and blood diseases, is thrombosis--the formation 
of blood clots. As anyone with hemophilia can affirm, the blood's 
ability to clot in response to an injury that allows it to escape from 
the blood vessels is a critical, life-preserving function. However, 
blood clots that form inappropriately, within intact vessels or the 
chambers of the heart, are responsible for a host of life-threatening 
events, including heart attack, stroke, peripheral vascular disease, 
and pulmonary embolism, as depicted in Chart 5. We have already 
developed a number of practical interventions to combat the devastation 
caused by thrombosis--for example, thrombolytic drugs to restore blood 
flow in the case of an acute heart attack; anticoagulants to prevent 
the clots that tend to form in the upper heart chambers of patients 
with atrial fibrillation and subsequently travel to the brain, causing 
strokes. Many opportunities now exist to make further progress by 
understanding, at a more fundamental level, how blood interacts with 
its environment. For instance, our research on atherosclerosis has 
revealed that the size of the plaque that clogs arteries may be far 
less important than other characteristics that make it susceptible to 
erosion and rupture, thereby releasing substances into the bloodstream 
that promote thrombosis. Millions of heart attacks may ultimately prove 
preventable if we can unravel this mystery and develop effective 
interventions. Furthermore, advances in our understanding of the 
genetics of thrombosis, coupled with new, highly sensitive imaging 
techniques, may enable us to identify persons who are most susceptible 
to these events, so that we can target the interventions to those most 
likely to benefit.
    Adaptive changes in tissue structure and composition, known 
collectively as ``remodeling,'' are a vital element of normal growth 
and development. However, remodeling in the heart muscle, the airways, 
and the blood vessels in response to prolonged disturbances, such as 
hypertension or inflammation, is harmful. Just as pulling too hard on a 
spring will stretch the coil out of shape and weaken it, years of 
uncontrolled hypertension can cause the cells of the heart muscle to 
lose their ability to contract, leading to heart failure. Similarly, 
remodeling of airway smooth muscle in response to chronic inflammation 
is a major feature of asthma. Exploration of the elements that regulate 
remodeling offers an unprecedented new opportunity to control or 
reverse many pathological processes.
    Angiogenesis--growth of new blood vessels--is a form of remodeling 
that can have both harmful and beneficial effects and is, therefore, 
the object of intense investigation. Recent studies indicate that both 
anti- and pro-angiogenic agents have significant potential for 
therapeutic use. For instance, cancer research has revealed that 
suppressors of angiogenesis can significantly and safely inhibit the 
growth of tumors by starving off their blood supply. On the other hand, 
angiogenesis promoters have been used successfully to bypass blood flow 
obstructions in people's legs, an approach that could reduce the need 
for amputation. Just last month, scientists reported success in using 
an angiogenic growth factor to increase blood flow to the heart muscle 
in patients whose coronary arteries were obstructed. This approach 
could have tremendous potential for reducing the suffering and costs 
associated with coronary heart disease.
    One additional example of remodeling involves the use of retinoic 
acid to stimulate growth of new air sacs, or alveoli, in the lungs of 
mice. Much work remains to be done before such an approach can be 
extended to humans, but it offers the first hope that emphysema--an 
invariably progressive and fatal disease--may be reversible.
    One final area of opportunity that I would like to mention, which 
is a trans-National Institutes of Health priority, is research on 
diabetes. Considerable progress has already been made in developing 
effective therapies, and there is much hope that a cure may ultimately 
be achieved. However, in the meantime, thousands of affected patients 
die each year, not of diabetes itself, but of its cardiovascular 
complications, as the data in Chart 6, derived from vital statistics 
and several small cohort studies, reveal. We perceive an urgent need 
for basic research to understanding the way in which diabetes increases 
cardiovascular risk, and for clinical studies to establish optimal 
goals for control of blood sugar, hypertension, and cholesterol levels 
in diabetic patients and to determine the best approach to 
revascularization of such patients who have coronary heart disease.
    I would be pleased to answer any questions that the Committee may 
have about the programs and plans of the NHLBI.
                                 ______
                                 
                  Prepared Statement of Harold Slavkin
    Mr. Chairman and Members of the Committee: The President in his 
fiscal year 1999 budget has proposed that the National Institute of 
Dental Research (NIDR) receive $214.6 million, an increase of $18.6 
million over the non-AIDS portion of the fiscal year 1998 
appropriation. Including the estimated allocation for AIDS in both 
years, total support proposed for NIDR is $229.5 million, an increase 
of $20 million over the fiscal year 1998 appropriation. Funds for NIDR 
efforts in AIDS research are included within the Office of AIDS 
Research budget request.
    The activities of the NIDR are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
                          a golden anniversary
    The NIDR will celebrate its 50th anniversary on June 24th, 1998. 
From today's perspective, the oral health of Americans 50 years ago was 
not as bleak as ``the undentisted ages'' Henry James described a 
century ago, but fell far short of ideal. Most Americans expected to 
be--and were--toothless by age 45. Tooth decay was so rampant that 
Congress was moved to establish NIDR by ``the appalling extent of 
dental disease and dental neglect.'' The new Institute would be 
responsible for ``conducting and fostering research on the causes, 
prevention, methods of diagnosis, and treatment of dental diseases and 
conditions.''
    And so we have. In 50 years we have transformed the practice of 
dentistry and literally changed the faces of millions of Americans. 
Today's dental office reflects a generation and more of private sector, 
professional and research community innovation and collaboration that 
have produced the high-speed handpiece, Panorex X-rays and digitized 
radiography, broad-ranging infection control and prevention, aesthetic 
dental materials and protective sealants, and exquisite pre- and post-
operative management of pain and inflammation. As a result of 
continuing declines in tooth decay and periodontal disease, only 10 
percent of our population is toothless. From the initial discoveries 
that dental caries was an infectious disease that fluoride could help 
to prevent, NIDR scientists have built a research base that has opened 
the door to the study of all the tissues of the craniofacial complex. 
Importantly, the applications of dental science to improved diagnostic, 
treatment and prevention strategies are saving an estimated $4 billion 
a year in the cost of dental care in America.\1\
---------------------------------------------------------------------------
    \1\ Brown, L.J., Beazoglu, T., and Heffley, D. (1994) Estimated 
savings in U.S. dental expenditures, 1979-1989. Public Health Reports, 
109(2), 195-203. The updated figure was provided through personal 
communication from the authors.
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                 a strategic plan for the 21st century
    Our mission to improve and promote craniofacial, oral and dental 
health through research remains. What has changed is how we hope to 
realize our goals. In the last year we published Shaping the Future, a 
strategic plan to carry us into the next century. We have streamlined 
our extramural and intramural research divisions to focus on six areas: 
Inherited Diseases and Disorders; Infection and Immunity; Oral and 
Pharyngeal Cancers; Chronic and Disabling Diseases; Biomaterials, 
Tissue Engineering and Biomimetics; and Behavior, Health Promotion and 
the Environment. These six areas reflect the penetration of oral 
science into all fields of biomedical and behavioral science and the 
imperative to address the riveting changes occurring throughout society 
worldwide: changes in demographics, in health care, in patterns of 
disease and in the very way we do science today. Ultimately, our goal 
is to meet the rising expectations of Americans to enjoy the best of 
health care and live to a ripe old age free of disease and disability.
                       as the twig is bent * * *
    Ideally, that means ensuring babies a healthy start at the 
beginning of life. Much of the excitement in biomedical research today 
lies in the discovery of genes that are essential to development. Of 
these, certain genes can be described as master architects of the body: 
They determine the basic body plan for tissues, organs and systems. A 
misspelling or mutation in such a gene can give rise to a condition 
like Rieger syndrome in which children are born with defects in organs 
situated at the front of the body. They have eye defects that can lead 
to glaucoma, small undeveloped teeth and a protuberant umbilicus. They 
may also have heart, limb and pituitary defects. Such multiple defects 
occur early in development, as the cells that form the embryo migrate 
to create the front to back, side to side and top to bottom orientation 
of life forms that developed early in the course of evolution. Indeed, 
these master genes were first discovered in fruit flies, where they are 
called homeobox genes. The newly discovered Rieger gene, called RIEG in 
the human condition and Rieg in mice, is a new member of a family of 
bicoid homeobox genes--proteins expressed in anterior structures of the 
body. In the fruit fly a RIEG-type gene is responsible for the design 
of the head.
    The finding that misspelling or mutations in a single gene can have 
so many ramifications is one of the more startling discoveries to come 
from molecular genetics research. In addition, two other syndromes we 
are studying underscore how often defects in teeth and bones occur 
along with other organ defects. For example, individuals born with 
cleidocranial dysplasia will be short, lack collar bones, suffer other 
craniofacial and skeletal abnormalities and yet may have more teeth 
than normal--all because they lack one copy of a gene that codes for a 
protein essential to bone formation. Mice lacking both copies of the 
gene are born with a complete lack of bone and die. A second multiple 
organ disorder is McCune Albright fibrodysplasia, a painful, crippling 
diseases in which there are bone lesions, changes in skin pigmentation 
and precocious puberty. Our investigators are working with scientists 
from the National Institute of Child Health and Human Development, the 
National Institute of Diabetes, Digestive and Kidney Diseases and the 
NIH Clinical Center to understand the disease process. As well, the 
need to help these patients is giving impetus to apply the principles 
of a revolutionary new science of Biomimetics.
    This new science unites biomedical knowledge of the genes and 
molecules that orchestrate the normal growth of bones, teeth, cartilage 
and other tissues with engineering, materials and computer sciences to 
achieve the natural repair and regeneration of body tissues. NIDR 
scientists have been prime movers in the discovery of the genes that 
encode growth molecules, now organized into families, such as bone 
morphogenetic proteins (BMP's). In collaboration with industry, these 
and other growth-promoting molecules have been synthesized, combined 
with other compounds and scaffolding material and readied for clinical 
use. So promising is this field that NIDR, in collaboration with the 
National Heart, Lung, and Blood Institute and the National Institute of 
Arthritis, Musculoskeletal and Skin Diseases issued a Request for 
Applications (to be funded this year) to spur research. NIDR will issue 
a Program Announcement in fiscal year 1999 that specifically targets 
craniofacial-oral-dental tissues for biomimetic repair and 
regeneration.
                         all cancer is genetic
    The path from the study of genes for development and repair to 
genes that figure in oral and pharyngeal cancer is short. Like all 
malignancies, these cancers develop because the genetic machinery that 
controls cell growth, differentiation and movement has gone awry, 
giving rise to a rogue clone of cells. With additional mutations the 
clone can become aggressive and invasive. This story has a tragic 
ending for the 9,000 Americans who die every year from oral and 
pharyngeal cancer. For those who do not die, radiation, chemotherapy 
and surgery leave a legacy of pain, disfigurement and dysfunction. 
After 5 years, the survival rate is only 50 percent.
    Logic dictates that if we are to derail this pathologic process, we 
need to identify the multiple sets of genes involved in cell growth, 
understand their function, and learn what happens when they are 
mutated. We also need to understand what makes some people inherently 
more likely to develop these cancers than others--isolating so-called 
cancer susceptibility genes. The next step is to develop tests to 
detect the presence of such genes and other markers of risk--
preferentially using easily obtained samples of saliva for diagnosis. 
Finally, we need to develop smarter treatments--ways to replace mutated 
genes with intact copies, for example, or ways to stop the formation of 
new blood vessels that feed a growing tumor. With the intense interest 
in advancing cancer research today, we have many opportunities for 
collaboration. We are already funding three of our four oral cancer 
research centers with the National Cancer Institute (NCI), and our 
plans call for further networking with NCI, NICHD, the Centers for 
Disease Control and Prevention, the American Dental Association, the 
National Dental Association, and other groups. These activities will 
highlight cancer prevention programs, especially efforts to eliminate 
tobacco use in young people.
                     pain and heat: a genetic link
    Not all gene discoveries relate to development or disease. One of 
the more striking findings in the past year solves a mystery that has 
long puzzled neuroscientists: How do we sense burning heat? It turns 
out it's by the same mechanism that makes a chili pepper taste fiery. 
When you touch a hot stove you excite a receptor on the surface of 
sensory nerve cells that will also react to the chemical in peppers 
that makes them hot--capsaicin. NIDR-sponsored scientists have now 
isolated and cloned the gene for the capsaicin receptor (technically 
known as vanilloid receptor 1--VR1) enabling them to study how the 
receptor works. Investigators now suspect that VR1-receptor-bearing 
nerve cells are involved in a number of chronic pain conditions, 
especially where inflammation plays a role, from viral and diabetic 
neuropathies and rheumatoid arthritis to oral mucositis pain caused by 
head and neck radiation or cancer chemotherapy. Interestingly, 
continued stimulation of capsaicin receptors can lead to cell death, 
which is the reason that capsaicin is being used as an ingredient in 
salves and chewing gum to relieve burning pain. With the new 
understanding of the pain-heat genetic link, still better approaches to 
relieve chronic pain may be on the horizon.
    A second pain experiment in the past year does not resolve a 
mystery so much as underscore what investigators have long suspected: 
There are sex differences in response to pain. The experiment in 
question revealed that men and women reacted very differently to a 
particular kappa opioid analgesic used for post-operative pain control 
in patients undergoing wisdom teeth extraction. Women reported 
excellent pain relief, while men reported little or no relief. These 
provocative findings will be explored further as part of the agenda of 
the NIH Pain Research Consortium, which NIH Director Dr. Harold Varmus 
established in 1997 to enhance pain research and collaboration. The 
Consortium, co-chaired by the Director of NIDR and the Director of the 
National Institute of Neurological Disorders and Stroke, held a major 
symposium, New Directions in Pain Research, in November, 1997, bringing 
pain researchers and leaders in other fields of neuroscience together 
with patient groups for an exchange of ideas, findings and issues. Next 
month we will hold another NIH Conference on ``Gender and Pain,'' and 
in May yet another NIH Conference on ``Palliative Remedies for the 
Management of Pain.'' A major trans-NIH Program Announcement has just 
been issues to further catalyze pain research.
                   oral routes for systemic infection
    Periodontal disease, in which pockets of destructive bacteria in 
the gums attack the soft tissue and bone supporting the teeth, may lead 
to dangerous systemic complications throughout the body. Currently, 
periodontitis is being investigated as one of the culprits in the 
yearly birth of 250,000 premature, low birth weight (LBW) babies. Women 
with periodontal disease were found to be seven times more likely to 
deliver low birth-weight babies prematurely. Preliminary studies show 
that periodontal disease also may be a major contributor to 
cardiovascular disease. If this seems improbable, consider that a 
single tooth site of infection and bleeding in the mouth, if removed to 
the skin, would be equivalent to a one-inch-square open sore on the 
palm of your hand. The bacteria in such lesions may well release 
byproducts into the general circulation that can damage tissues 
directly or through the release of inflammatory mediators by the immune 
system. The constant production of such molecules in a chronic, 
inflammatory disease like periodontitis could then lead to tissue 
damage. In the case of pregnancy, these molecules can also induce pre-
term labor. Further evidence of the potential damage to the body from 
oral bacteria comes from a recent study in which NIDR-supported 
investigators infused a common oral bacterium into the bloodstream of a 
rabbit. Within moments the bacteria secreted a unique protein with 
properties that stimulated the formation of a precocious blood clot, 
initiating a process that could lead to a heart attack or stroke.
                             next 50 years
    Our Strategic Plan commits NIDR to three major initiatives: (1) to 
support world-class science across the six program areas described 
earlier; (2) to enhance research capacity by revitalizing 
infrastructure and training and career development programs; and (3) to 
intensify health promotion efforts so that research findings are 
readily adopted by providers and the public. A variety or 
organizational and administrative changes are in place to further these 
ends. As well, these changes will provide us with the flexibility and 
creativity that are needed to meet the challenges of a rapidly changing 
and complex society. In a year, we have seen unprecedented growth in 
the economy, exponential growth of information technology, and a rise 
in the standard of living. At the same time, we are witnessing a 
fundamental restructuring in health care delivery, we are faced with a 
steady stream of new or re-emerging diseases, and we must come to grips 
with the many bioethical issues occasioned by the progress of human 
genome and cloning research. These developments are fostering a climate 
of cooperation, collaboration, and communication that extends beyond 
NIH and the research community to the public at large. Communicating 
the facts of biomedical science is the best means we have to empower 
Americans to make decisions and life style choices to improve their 
health and prevent disease. That goal was intrinsic to the NIDR mission 
50 years ago, and will continue to be a driving force in the century 
ahead.
    My colleagues and I will be happy to respond to any questions you 
may have.
                                 ______
                                 
                  Prepared Statement of Phillip Gorden
    Mr. Chairman and Members of the Committee: I am pleased to testify 
before the Committee on behalf of the National Institute of Diabetes 
and Digestive and Kidney Diseases. The President in his fiscal year 
1999 budget has proposed that the NIDDK receive $927.5 million, an 
increase of $69 million over the comparable fiscal year 1998 
appropriation. Including the estimated allocation for AIDS in both 
years, total support proposed for NIDDK is $944.3 million, an increase 
of $70.5 million over the fiscal year 1998 appropriation. Funds for 
NIDDK efforts in AIDS research are included within the Office of AIDS 
Research budget request.
    A major goal of the NIDDK is to make investments in innovative 
technologies and discoveries that can be directly applied to patients 
in clinical trials. These advances then have immediate application to 
patient care and public health. This general process can be illustrated 
by examples in diabetes that clearly point to research advances and 
help chart our further progress. One of the most important objectives 
of our current research investment is to reduce the intensity and 
duration of an individual's exposure to high levels of blood glucose 
and to develop other risk-reducing therapies. Today, because of our 
earlier investments in basic science, we are able to pursue this 
objective through new research initiatives. It was our investment in 
basic research that produced the tools that enabled us to reach the 
point of applying clinical trial methodology. Through these trials, we 
could assess whether the complications of diabetes and onset of the 
disease itself can be prevented, thus laying the foundation for today's 
diabetes research agenda.
           diabetes as an illustration of research investment
    Diabetes is the most common cause of end stage renal disease. Thus, 
one of our major goals is to reduce the risk of this complication as 
well as other complications such as blindness, nerve degeneration and 
amputations. A class of drugs known as angiotensin converting enzyme 
inhibitors, originally designed to treat hypertension, were found in 
animal models to decrease the effect of diabetes on the development of 
kidney disease. When this approach was tried in diabetic patients who 
were developing kidney disease, we found a major effect of the drug in 
slowing the deterioration of kidney function. This is an excellent 
example of tertiary prevention, where the agent works independent of 
the effect on blood glucose concentrations. Now, if we add this effect 
to a major effect of lowering blood glucose concentration as shown in 
the Diabetes Control and Complications Trial, we see a dramatic effect 
of lowering risk by adding a form of secondary prevention to tertiary 
prevention. These major advances have already been introduced into 
clinical practice in both forms of diabetes.
    These results also paved the way to development of primary 
prevention strategies for two ongoing clinical trials. In the first, 
the Diabetes Prevention Trial, we are testing whether the prophylactic 
administration of insulin can prevent or delay the onset of type 1 
diabetes in at-risk individuals. In the second, the Diabetes Prevention 
Program, we are testing whether lifestyle and drug interventions can 
prevent or delay the onset of type 2 diabetes in at-risk individuals, 
including minority populations. These primary prevention trials are 
promising.
    In a predictive model, the effects of these various interventions 
in type 1 diabetes can be added together and extrapolated to the 
future, as shown on Figure 1. This model shows that the risk of 
developing diabetic kidney disease in at-risk populations may be 
enormously decreased, and this relates to other complications as well. 
Thus, from our basic research investments, we have developed strategies 
to interdict the course of diabetes and its complications. Though 
successful, these therapeutic regimens are difficult to follow, 
especially for children and adolescents. Patients and their families 
want better technologies that will produce easier and more effective 
treatments.
    To expand our therapeutic tools, we need innovative strategies for 
achieving the diabetes research advances of the future. Let me give you 
some examples of how we propose to achieve these goals. Specific 
mechanisms of interdicting the immune destruction in type 1 diabetes 
are now possible. For instance, we are using transgenic technology to 
create animal models to pinpoint mechanisms that will modulate the 
immune system, first in animals, and then in patients who are at-risk 
for the development of type 1 diabetes. Other key parts of our research 
agenda will be: (1) To discover the mechanism by which insulin-
producing beta cells are destroyed, including exploitation of recently 
emerging concepts about the general mechanisms of cell death; (2) To 
identify possible viral or environmental factors that may cause type 1 
diabetes, including retroviruses; (3) To find transcription factors 
that regulate the tissue-specific generation of insulin-producing 
cells, including the possibility of stimulating a progenitor cell to 
produce insulin after the mature insulin-producing cells have been 
destroyed; (4) To engineer insulin-producing cells using constructs 
that will confer a specific property on the cell, such as the 
properties of glucose recognition, glucose sensing, and other similar 
regulatory steps; and (5) To develop other cell-based therapeutic 
modalities.
    In order to close the gap in the difficulty of administering 
insulin, we will foster research on a variety of glucose-sensing 
technologies. Recently, one of our investigators has presented an 
algorithm to relate interstitial or tissue glucose concentrations to 
blood glucose concentrations. A probe-sensing interstitial glucose 
concentration would avoid issues related to applying a probe to blood 
itself and would therefore be an important potential way to close the 
sensing loop. Thus, the concept of glucose sensing coupled to a 
delivery system is under vigorous pursuit and will clearly be a major 
effort in the next several years.
    Further approaches to understanding the causes of diabetes will be 
pursued by genetic techniques. Six known genes are involved in several 
forms of type 2 diabetes, and several large scale studies using ``high 
throughput'' genomics are attempting to find new genes in more 
conventional forms of type 1 and type 2 diabetes. With NIDDK 
sponsorship, a consortium of scientists is pursuing the genetics of 
both forms of diabetes. We are enthusiastic about the application of 
genetic technology to our understanding of the complications of 
diabetes. For example, we now know that only about 40 percent of long-
term diabetics ever develop renal disease and that diabetic renal 
disease has a familial association. We now have the opportunity to 
elucidate the specific genes involved and how they may be modified by 
other environmental factors. This will be the focus of intense research 
in the next several years.
    Insulin resistance is a major feature of type 2 diabetes and a 
major investment in this area of research has led to our ability to 
conduct our prevention clinical trials. We now have four classes of 
orally administered drugs that are highly effective in the treatment of 
type 2 diabetes. These therapeutic advances are derivative of our basic 
research in insulin resistance and secretion. We now have state-of-the-
art nuclear magnetic resonance technology to study glucose metabolism 
directly in the human body. This will provide important insights and 
new avenues of research into the role of circulating substrates and 
other factors that relate to insulin resistance. For instance, we are 
learning about the mechanisms by which exercise produces insulin 
sensitivity and are identifying new potential targets for drugs to 
modify insulin resistance. Further, the role of defective insulin 
secretion is becoming progressively well-defined in the onset of type 2 
diabetes. These studies provide us with new potential therapeutic 
targets.
    Our diabetes research agenda has advanced rapidly as new resources 
have become available. In this exciting endeavor we have been guided by 
the advice of leading scientific experts. To aid our short-term program 
development, we have the recommendations of a landmark trans-NIH 
symposium that the NIH Director and the NIDDK sponsored in September, 
1997, along with eight other NIH components on: ``Diabetes Mellitus: 
Challenges and Opportunities.'' We have also formed a trans-NIH 
advisory group of the leaders of those institutes to provide continuing 
advice. In addition, we have established the congressionally-directed 
Diabetes Research Working Group, which is developing a longer-range, 
comprehensive plan for the Congress. We are continuing to promote 
collaborations across the NIH and to seek partnerships with the 
biotechnology and pharmaceutical industries, and voluntary health 
organizations. Likewise, we will disseminate important research 
findings through the National Diabetes Education Program. This 
Education Program, which we support with the CDC and others parts of 
the diabetes community, is making a special effort to reach minority 
populations disproportionately affected by type 2 diabetes. For support 
of this program and all of our activities to improve the health of 
minorities through NIDDK research, I would like to extend our sincere 
appreciation to Congressman Louis Stokes, who has always been a strong 
advocate for minority health during his membership on this Committee.
       other examples of important research needs and investments
    Obesity is a major risk factor for type 2 diabetes, lipid 
disorders, hypertension, cardiovascular disease and cancer. As part of 
the Institute's Obesity Research Initiative, we provided leadership in 
establishing a Task Force on the Prevention and Treatment of Obesity to 
provide expert scientific advice to the NIH and the public; established 
Obesity/Nutrition Research Centers; and launched a Weight-Control 
Information Network. Through basic research, we have discovered 
multiple genetic loci for obesity in animals, with human parallels. The 
most dramatic discovery in the field of energy regulation was the 
identification of the first obesity gene and its protein product, 
leptin. In fiscal year 1999, we will continue to expand our programs to 
exploit the discovery of obesity genes and the complex neuroendocrine 
systems that regulate both food intake and energy utilization. Most 
importantly, we are making plans to initiate a major clinical trial, 
which we hope will show that the numerous health risks imposed by 
obesity can be reduced by voluntary weight loss.
    Many diseases within the NIDDK research mission involve infectious 
and inflammatory processes. To combat chronic liver disease we will 
launch a major natural history study of hepatitis C, based on a 
Consensus Development Conference we sponsored with NIAID. We are also 
pursuing expanded research on the role of cytokines and other mediators 
of infection and inflammation in food-borne illnesses that affect the 
digestive system and the kidney, and are building on a trans-NIH 
initiative on hemolytic uremic syndrome. In addition, we will continue 
our efforts to find new therapeutic targets in the inflammatory bowel 
diseases. In urologic diseases, we are promoting enhanced basic 
research to understand the biology of the pelvic floor, and its 
susceptibility to infection and inflammation. We have reformulated the 
database on interstitial cystitis, and are collaborating with the NIA 
and NICHD on urinary incontinence. We are also actively pursuing the 
possibility of developing a vaccine to protect against recurring 
urinary tract infections. Concomitantly, we are intensifying research 
on the biology of the prostate, which includes studies of benign 
prostatic hyperplasia, prostatitis, and prostate cancer, in 
collaboration with the NCI. In cystic fibrosis, we will be exploiting 
newly discovered concepts about how chronic infection is initiated and 
perpetuated.
    In genetics, an example of recent research progress is the 
convergence of several discoveries with respect to iron, which is 
important in nutrition, growth, and the maintenance of red-blood cells. 
However, iron overload is involved in a variety of disease processes, 
such as hemochromatosis, one of the most common genetic diseases in the 
U.S. Recently, scientists discovered the major gene for this disease. 
Paralleling this discovery, is the elucidation of the protein 
responsible for iron transport in the digestive tract.
    Our investment in basic research continues to be the wellspring of 
our innovative strategies for the future. We continue to make progress 
in understanding the role of a defective gene in the development of 
polycystic kidney diseases and are making plans to develop clinical 
milestones on which therapeutic strategies can be based. Similarly, 
endocrine research on hormones and growth factors is broadly applicable 
to breast, prostate and thyroid cancer, as well as to bone diseases 
such as osteoporosis. Other research with broad implications is a 
planned study of analgesic-associated kidney disease. A widely 
applicable model system is the zebrafish, which will provide a tool for 
visualizing pathways turned on in the development of insulin-producing 
cells in diabetes, as well as other developmental pathways. An example 
of basic research with unexpected therapeutic applications is work 
conducted by NIDDK intramural scientists on the properties of a toxin 
derived from a tropical frog, which shows promise of generating a new 
class of substances for effective pain management. Thus, progress in 
diabetes research and other disease-oriented research of the NIDDK 
depends on the continuing NIH investment in a strong foundation of 
fundamental and clinical research--along with research training and 
career development--as the underpinning of the entire biomedical 
research enterprise.
    The activities of the NIDDK are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    This figure displays ``model'' projections of the potential 
benefits of past and ongoing NIDDK clinical trials on the rate of renal 
failure in people with type 1 diabetes. Similar benefits are projected 
for eye and nerve complications (data not shown). All patients enter 
the model before diabetes develops, according to the eligibility 
criteria for the NIDDK's ongoing primary prevention trial for type 1 
(Diabetes Prevention Trial 1 or DPT-1). The treatment after entry into 
the model is described below:
Types of Prevention:
    None.--No treatment before diabetes develops; the model assumes 
that the patient receives historical diabetes care. After diabetes 
develops, the model assumes that standard diabetes care is given, as 
defined in the Diabetes Control and Complications Trial, that is, 
metabolic control of blood glucose levels to maintain clinical well 
being, but without the use of intensive treatment techniques or use of 
drugs, called angiotensin converting enzyme inhibitors (ACE 
inhibitors), for reduction of excess levels of protein in the urine.
    Tertiary Prevention.--1993--Clinical Trial with ACE Inhibitors: No 
treatment before diabetes develops. Standard DCCT care after diabetes 
develops. Use of ACE inhibitors in those developing gross proteinuria. 
This treatment regimen is assumed to reduce the rate (percent/year) of 
patients progressing from gross proteinuria to renal failure by 50 
percent a year, according to the clinical trial funded by the NIDDK.
    Secondary Prevention.--1993--Prevention of the Eye, Nerve and 
Kidney Complications of Diabetes in the NIDDK Clinical Trial of Glucose 
Control (the Diabetes Control and Complications Trial, commonly known 
as the DCCT). No treatment before diabetes develops. Intensive diabetes 
care after diabetes develops (that is close metabolic control of blood 
glucose levels), resulting in a measurement of blood glucose levels by 
a test called the called ``hemoglobin A1C test'' of 8 percent--levels 
which are approximately equal to the blood glucose levels maintained by 
the entire DCCT cohort for the 5 years subsequent to the conclusion of 
the trial, and about 50 percent of the effect achieved during the 
trial. Use of ACE inhibitors is assumed if gross proteinuria develops, 
with the reduction in risk described above.
    Primary Prevention.--Ongoing Trial--Prevention of the Onset of Type 
1 Diabetes in At Risk Individuals Through Prophylactic Administration 
of Insulin in the NIDDK-Funded Diabetes Prevention Trial (commonly 
called the DPT-1). This clinical trial, which is currently in progress, 
assumes that the risk of developing diabetes is reduced by 75 percent 
by the interventions being tested--the prophylactic administration of 
oral or parenteral insulin. Care if diabetes develops is as described 
above, and includes intensive diabetes care and use of ACE inhibitors. 
Note that the figure shows the theoretical benefits of yet-unproven 
therapies, while benefits shown for ACE inhibitors and Glucose Control 
are proven benefits of these interventions--projected over the 
patient's lifetime--based on data obtained from completed clinical 
trials funded by the NIDDK.
                                 ______
                                 
                  Prepared Statement of Audrey S. Penn
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the National Institute of 
Neurological Disorders and Stroke for fiscal year 1999, a sum of $815.6 
million, an increase of $61.3 million, or 8.1 percent. Including the 
estimated allocation for AIDS, total support proposed for NINDS is 
$844.3 million an increase of $63.6 million over the 1998 
appropriation. Funds for NINDS efforts in AIDS research are included 
within the Office of AIDS research budget request.
    Today, I appear before you as the Deputy and Acting Director of the 
National Institute of Neurological Disorders and Stroke (NINDS). As a 
neurologist and as a former grantee of NINDS and member of the Advisory 
Council, I welcome the opportunity to be able to personally report to 
you about the activities of the NINDS research programs. We have been 
part of some amazing success stories over the past several years and 
have great hope that even more may be achieved to improve the care and 
treatment of people with brain diseases.
                          parkinson's disease
    Parkinson's disease (PD), is one of several neurodegenerative 
disorders in which progressively more and more neural cells in the 
motor control regions of the brain degenerate and stop working. In the 
case of Parkinson's disease, this process results in symptoms such as 
tremor and rigidity and eventually leads to disability and death. Other 
degenerative disorders such as Huntington's disease, amyotrophic 
lateral sclerosis, and Alzheimer's disease present with different sets 
of symptoms because different neural cells are affected.
    NINDS has long maintained a strong research emphasis both in our 
intramural and extramural programs in Parkinson's disease. This 
commitment has been met with success, for example, in understanding 
more about the system of cells, affected in PD, which use dopamine as 
their functioning chemical unit. Over the past few years there has been 
an acceleration of new findings that mark a turn in the outlook for 
progress. Following a 1995 workshop on Parkinson's disease, NINDS 
initiated a collaboration with the National Human Genome Research 
Institute and extramural investigators which quickly showed that in a 
single large family PD was caused by an alteration in a gene on 
chromosome 4. Further study showed that the gene is the blueprint for a 
protein called synuclein. Fortunately, synuclein was not entirely 
unknown to scientists; it had been previously identified in synapses 
(the point of contact between nerve cells) of electric fish and had 
been studied in rats, birds, and humans. Synuclein has been found in 
amyloid plaques, or aggregates of protein, found within brain cells of 
people with Alzheimer's disease and now it has also been found in Lewy 
bodies, also aggregates of protein, which are found in brain cells from 
people with the more common, non-inherited form of Parkinson's disease. 
The first chart shows Lewy bodies stained with an antibody specific for 
synuclein. So, one research discovery has brought together 
investigative themes from two major neurodegenerative disorders and has 
also raised new questions. Scientists are working to find out the role 
of synuclein in PD and are looking actively for other defective genes 
that may contribute to PD in other cases. Research to study the role of 
genes is PD is a very exciting and important endeavor, but it is just 
one part of a spectrum of studies supported by NINDS. We are supporting 
efforts to design and improve therapies including surgical approaches 
(pallidotomy), deep brain stimulation, cellular implantation, and use 
of growth factors. As a major new effort, NINDS has issued a request 
for applications for Parkinson's Disease Research Centers of Excellence 
which will place emphasis on multidisciplinary and collaborative 
studies and will include both basic and clinical research projects.
    I mentioned previously that brain cells of people with Alzheimer's 
disease and Parkinson's disease have abnormal aggregates of proteins 
that should not be there. The last few years have brought a remarkable 
convergence of evidence that several other neurological disorders 
result from abnormal folding and aggregation of proteins. Most notably, 
Dr. Stanley Prusiner, a grantee who has received funding from NINDS, 
the National Institute on Aging, and other NIH components, received the 
Nobel prize for his research to understand rare brain disorders known 
as transmissible spongiform encephalopathies (TSE's). In people who 
have inherited TSE's, a variation of a normally occurring protein 
called a prion is predisposed to become abnormally folded. The proteins 
clump together and eventually the nerve cells in which they are found 
die. Research also implicates abnormal protein aggregates in a group of 
diseases known as triplet repeat disorders; so named because one of the 
specific three-part coding units of the genetic code is repeated 
sequentially on the gene, an abnormal number of times. The second chart 
shows the difference between a normal gene sequence (and its product) 
and a triplet repeat (and its product). If protein aggregates play a 
role in causing nerve cells to die, then interventions to prevent them 
from forming may one day yield a new therapeutic strategy. Research to 
understand protein folding and protein-protein interactions in 
neurological diseases is an emerging and very active area of research 
which NINDS is pursuing and hopes to expand.
                                 stroke
    Stroke is a major health problem in the United States; recent 
results from a study funded by NINDS at the University of Cincinnati 
Medical Center reveal that approximately 700,000 strokes occur each 
year in the U.S. Based on data from the National Center for Health 
Statistics approximately 150,000 Americans die from stroke each year. 
Those who survive are often left with major disability, at great 
emotional and financial cost to their families and to our society. Many 
people do not really understand what a stroke is, what the warning 
signs are, or what can be done for stroke. Strokes occur when a blood 
clot (thrombus or embolus) blocks the circulation of blood within the 
blood vessels of the brain or when a blood vessel ruptures. As a 
result, the brain experiences a loss of oxygen and energy (in the form 
of glucose) which can kill brain cells and cause various symptoms such 
as paralysis, loss of speech, or confusion.
    NINDS supports and conducts research that encompasses the time 
before, during, and after stroke. For example, we have shown that 
surgery will prevent stroke in some patients. We also support an 
ongoing a clinical trial to test estrogen to prevent stroke in post-
menopausal women who have had one stroke and are at risk for another, 
and we support epidemiological studies of risk factors for stroke in 
white, African-American, and Hispanic populations. The greatest 
contribution that NINDS has made to date for the acute strokes 
resulting from blood clots came from a 10 year research effort that 
demonstrated tissue plasminogen activator or tPA as the first proven 
treatment. The highly significant results showed that 11 more 
individuals out of every 100 patients were out of the hospital, free of 
major neurological impairments, not disabled, not in nursing homes, and 
back to their usual activity at the end of three months. This continues 
to be true at one year follow up. To be successful, however, the 
treatment must begin within three hours of the onset of stroke. The 
results with tPA have provided a whole new motivation to treat stroke 
as an emergency. The emergency aspects and the timing required for a 
successful result have required a change in attitude and behavior on 
the part of family, patients, and emergency and health care 
professionals. NINDS staff have been working closely with organizations 
involved with the care of stroke patients and the media to get the word 
out on ``brain attacks.'' For example, I am sure that in your home 
states the paramedics, the emergency physicians at the community 
hospital, perhaps even the visitors at the local senior citizens center 
will be able to tell you that they have heard or read about advances in 
the treatment of stroke.
                           spinal cord injury
    The advance in the use of tPA to treat stroke is the second time in 
recent memory that NINDS had an impact on emergency care. In 1990, a 
multi-center clinical trial supported by NINDS confirmed the 
effectiveness of methylprednisolone for the treatment of acute spinal 
cord injury, and set a new international standard of treatment for 
these patients. NINDS grantees continue to strive to improve on 
success: The results from a second trial completed in 1997 have shown 
that giving the drug for a longer period of time can significantly 
improve recovery over the standard treatment among patients who start 
treatment between three and eight hours of injury. NINDS supports many 
other efforts to understand the mechanisms by which trauma to the 
spinal cord produces injury and how the spinal cord might try to repair 
itself. We have shed some new light on these events. Recent results 
suggest that the regeneration of axons, the extensions from the nerve 
cell where signals are passed on and which are often severed during 
injury, may use a unique approach. Investigators have now shown that 
axons regenerate by extending blunt, growing tips which are filled by 
the proteins called neurofilaments. In contrast, during development, 
the axon is pulled along by long finger-like projections and then 
filled with the structural protein, actin. We need further 
investigations into these mechanisms so we may one day use the body's 
own capabilities to foster recovery.
                  children and neurological disorders
    Cerebral palsy, autism, muscular dystrophy, epilepsy, the ataxias, 
neurofibromatosis, Batten disease--these are just some of the 
neurological disorders that can affect children. I am proud to say that 
NINDS has a long history of commitment to research to benefit the 
health of children. In fact, early in my career I participated on a 
study, funded by this Institute, that is one of the largest studies of 
the newborn period ever undertaken to investigate risk factors for 
cerebral palsy and retardation.
    I would like to highlight just some activities in research on brain 
diseases in children. More than a third of all genetic disorders affect 
the nervous system, and hundreds affect infants and children. Recent 
progress includes gene discoveries for torsion dystonia, Batten 
disease, ataxia-telangiectasia, Niemann-Pick disease type C, and one 
type of childhood epilepsy. NINDS and the National Institute of Child 
Health and Human Development (NICHD) are co-sponsoring a clinical trial 
to follow up on evidence that the administration of magnesium sulfate 
to mothers at risk for premature delivery is associated with a reduced 
risk of cerebral palsy in their infants. We have funded new studies in 
autism and work with our colleagues in other Institutes to further 
advance research in autism.
                            new initiatives
    Finally, I will close with the mention of several major initiatives 
that NINDS will be involved with. In fiscal year 1999, NINDS with NIMH, 
will begin the brain molecular anatomy project (BMAP) to map gene 
expression in different parts of the brain during development, 
adulthood, and aging. A separate effort has been launched with NCI to 
characterize the genes associated with brain tumors which may be unique 
to the neoplastic state. Both efforts will result in a tremendous 
resource for investigators across the country. NINDS will also work 
with other interested institutes towards an expanded research program 
in pain. Another initiative will seek to accelerate the development of 
brain imaging techniques.
    The activities of the NINDS are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    Mr. Chairman, I would be pleased to answer any questions you might 
have.
                                 ______
                                 
                 Prepared Statement of Anthony S. Fauci
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the National Institute of Allergy 
and Infectious Diseases (NIAID) for fiscal year 1999. The President 
proposes that the NIAID receive $702 million, an increase of 8 percent 
for NIAID non-AIDS research activities. Including the estimated 
allocation for AIDS research activities, total support proposed for the 
NIAID is $1.47 billion, an increase of 8.6 percent over the comparable 
fiscal year 1998 appropriation. Funds for NIAID AIDS research efforts 
are included in the Office of AIDS Research budget request.
    The activities of the NIAID are covered by the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to the HHS GPRA 
Strategic Plan which was transmitted to Congress on September 30, 1997. 
The NIAID is anxious to meet the challenges set forth in this plan and 
we look forward to continued support from Congress that will facilitate 
our achieving these goals.
           fifty years: advancing knowledge, improving health
    This year, the NIAID celebrates fifty years of progress in 
understanding, treating and preventing infectious and immunologic 
diseases. During the past five decades, NIAID-supported research in 
fields such as microbiology and immunology has led to new therapies, 
vaccines and diagnostic tools that have profoundly benefitted global 
health. Capping this remarkable half-century are recent advances and 
initiatives that promise to further reduce the burden of disease in 
this country and around the world. Meanwhile, new challenges to the 
public health continue to emerge, underscoring the need for continued 
progress in our fight against infectious microbes and diseases of the 
immune system.
                         immunologic tolerance
    A long-standing goal of NIAID-supported immunology research is the 
development of new and better ways to prevent the rejection of 
transplanted organs and tissue ``grafts'' by the immune system. While 
current immunosuppressive drugs have greatly reduced graft rejection, 
these agents are highly toxic and increase a patient's risk of 
infection, cancer and other complications. In addition, despite major 
improvements in immunosuppressive therapy, 10 to 50 percent of 
transplanted organs and tissues are rejected by patients' immune 
systems within the first year.\1\ Even with the latest 
immunosuppressive drugs, approximately 60 percent of transplanted 
kidneys, the organ most often transplanted, are rejected within 10 
years.\2\
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    \1\ United Network for Organ Sharing. ``The 1997 Report of Center-
Specific Graft and Patient Survival Rates.'' Richmond, VA.
    \2\ Cecka, J.M. 1996. The UNOS scientific renal transplant 
registry. Clinical Transplants. p. 1-14.
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    As we work to improve this record, we are encouraged by new 
findings, underpinned by years of basic immunology research, that show 
the feasibility of a totally new approach to preventing graft 
rejection. NIAID-supported researchers have demonstrated that it is 
possible to induce immunologic ``tolerance'' to a graft by turning off 
the specific immune responses that would otherwise attack it. Promising 
results in animal models have been achieved with transplanted kidneys 
and livers; early human studies suggest that long-term tolerance of 
transplanted bone marrow may be achieved with appropriate therapy.
    One approach to inducing tolerance is to block the second of two 
signals needed by T cells to become activated and orchestrate an attack 
on a foreign tissue or organ. In this regard, several different 
blocking molecules have shown considerable promise. Other approaches to 
inducing tolerance involve manipulating immune system molecules called 
cytokines, or inducing the suicide of the immune cells that otherwise 
would attack a graft. The refinement of strategies for inducing 
tolerance could revolutionize the field of transplantation and benefit 
the tens of thousands of patients whose lives could be saved or 
improved by a donated organ. In addition, our growing knowledge of 
immune tolerance will help in understanding and treating other 
conditions such as cancer, autoimmune conditions, and allergic and 
infectious diseases.
                     burden of infectious diseases
    It is underappreciated that infectious diseases remain the leading 
killer of people globally and the third leading cause of death in the 
United States.\3\ \4\ Of the approximately 52 million deaths worldwide 
in 1996, more than 17 million were due to infectious diseases, 
including approximately 9 million among children.\5\ In addition, a 
growing number of cancers and other chronic conditions have been 
attributed to infectious agents. For example, the bacterium 
Helicobacter pylori causes ulcers and stomach cancer, and Chlamydia 
pneumoniae has been implicated as a cause of artery-clogging plaques. 
Both hepatitis B virus and hepatitis C virus (HCV) can lead to liver 
cancer, and human papillomavirus is responsible for most cases of 
cervical cancer. In addition to their human toll, the financial burdens 
of infectious diseases are enormous. In the United States alone, costs 
associated with infectious diseases exceed an estimated $120 billion 
annually.\6\
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    \3\ World Health Organization. 1997. ``The World Health Report 
1997.'' Geneva: World Health Organization.
    \4\ Pinner, R.W. et. al. 1996. Trends in infectious diseases 
mortality in the United States. JAMA. 275:189-193.
    \5\ World Health Organization. 1997. ``The World Health Report 
1997.'' Geneva: World Health Organization.
    \6\ Institute of Medicine. 1997. ``America's Vital Interest in 
Global Health.'' Washington, DC.: National Academy Press.
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    In the face of the enormous challenges posed by infectious 
diseases, the sustained commitment of NIAID to basic and applied 
research has paid enormous dividends against newly recognized 
pathogens--such as human immunodeficiency virus (HIV) and HCV--and 
scourges which have long plagued humanity, including malaria, 
tuberculosis and life-threatening infant diarrhea.
                       progress against hiv/aids
    HIV, the cause of the acquired immunodeficiency syndrome (AIDS), 
remains one of the greatest threats to global health. More than 30 
million people worldwide are living with HIV/AIDS, a number expected to 
reach 40 million by the year 2000. In the 17 years since AIDS was 
recognized, an estimated 11.7 million people with HIV worldwide have 
died,\7\ including approximately 380,000 in the United States.\8\ 
Despite the mounting toll of HIV, recent developments have provided a 
measure of optimism. In the United States, AIDS deaths dropped 44 
percent from the first six months of 1996 to the first six months of 
1997; new AIDS diagnoses declined by 12 percent during the same 
period.\9\ These encouraging trends are probably due to several 
factors, notably the increased use of potent combinations of anti-HIV 
drugs, and our growing ability to prevent and treat the many secondary 
infections associated with HIV disease.
---------------------------------------------------------------------------
    \7\ UNAIDS: ``Report on the Global HIV/AIDS Epidemic.'' Geneva, 
December, 1997.
    \8\ Centers for Disease Control. 1996. ``HIV/AIDS Surveillance 
Report.'' 8(no. 2): 1-40.
    \9\ DeCock, Kevin. 1998. Presentation: Fifth Conference on 
Retroviruses and Opportunistic Infections, February 2, Chicago, IL.
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    Basic research into the structure of HIV and how it interacts with 
the immune system led to the development of the 12 antiretroviral drugs 
now licensed in this country. Various combinations of these drugs, as 
well as several investigational drugs now in clinical trials, have 
helped restore the health of many patients, dramatically reducing the 
amount of HIV in their bodies and lowering their risk of secondary 
infections, hospitalizations and death. In addition, new insights into 
the pathogens that prey on the weakened immune systems of HIV-infected 
individuals have led to improved prophylactic and curative therapies.
    Unfortunately, many HIV-infected individuals have not benefitted 
from the currently available drugs, cannot tolerate their side effects, 
or have difficulty complying with complex treatment schedules that may 
require them to take 30 or more pills a day. In addition, the ability 
of HIV to mutate and become resistant to the current drugs is a 
persistent threat. Therefore, the development of the next generation of 
therapies--well-tolerated, effective drugs that can be administered 
with a minimum of doses for prolonged periods--remains a priority. 
Together with partners in academia and industry, NIAID-supported 
scientists are pursuing many new treatment strategies and exploring 
ways to boost an HIV-infected person's immune system.
                          hiv vaccine research
    In many developing countries, where health care spending may be 
only a few dollars per person each year, such therapies will probably 
remain beyond the reach of all but the most privileged. Therefore, 
continued research into an HIV vaccine and other means of preventing 
HIV infection is crucial to slowing the epidemic in these settings, as 
well as in our own country. To speed the pace of discovery, NIAID has 
strengthened its efforts in HIV vaccine research. Among recent 
initiatives are 58 new grants to foster innovative research on HIV 
vaccines and the establishment of a Vaccine Research Center within the 
NIH intramural research program.
                              hepatitis c
    Another recently recognized pathogen of great concern is hepatitis 
C virus (HCV), identified in 1989. HCV is a leading cause of cirrhosis, 
liver cancer, and a major reason for liver transplants. Worldwide, more 
than 170 million people are chronically infected with HCV, including 4 
million individuals in the United States.\10\ Annual HCV-related deaths 
number approximately 8,000 to 10,000 people in this country,\11\ a 
figure projected to reach 24,000 deaths/year by 2017 if effective 
therapies are not found. To combat this epidemic, NIAID recently 
established a network of Hepatitis C Research Centers to study the 
virus and how it causes disease. In the past year, researchers at one 
of the new centers reported a major breakthrough: the construction of 
functional, infectious clones of HCV, using genetic engineering 
techniques. This advance has facilitated HCV studies in cell cultures 
and animal models.
---------------------------------------------------------------------------
    \10\ World Health Organization. 1997. ``Weekly Epidemiological 
Record: March. 7, 1997.'' Geneva: World Health Organization.
    \11\ National Institutes of Health. 1997. Consensus Statement: 
Management of Hepatitis C. Bethesda, MD.
---------------------------------------------------------------------------
             response to the threat of h5n1 avian influenza
    We have come to understand that the emergence of previously 
unrecognized pathogens such as HIV and HCV is a continual process. As 
further evidence of this, the first known cases of human influenza 
caused by a virulent bird virus known as H5N1 avian influenza were 
identified in Hong Kong in 1997. Given the possibility that this avian 
virus might combine with a human influenza strain and become more 
readily transmissible, possibly resulting in a pandemic, NIAID moved 
quickly with our colleagues at the Centers for Disease Control and 
Prevention, World Health Organization and other agencies in addressing 
research questions and public health needs associated with the 
outbreak. Fortuitously, as part of our long-standing research into 
respiratory viruses, we had in our repository the specific antisera 
needed to quickly develop test kits for detecting the avian influenza 
virus. NIAID has also supported the production of a recombinant vaccine 
for use in at-risk laboratory and health care personnel, as well as a 
surveillance effort in Hong Kong to identify and characterize the 
source of the avian virus.
                    a commitment to malaria research
    More than 40 percent of the world's population lives in areas at 
risk for malaria transmission.\12\ Approximately 300 to 500 million 
cases of malaria occur worldwide each year; every 20 seconds, a child 
dies of the disease.\13\ In the past year, the National Institutes of 
Health, together with research organizations and donor agencies from 
around the world, have worked to mobilize the scientific resources and 
political will needed to control this dread disease. The extraordinary 
interest among scientists, political leaders, the media and the general 
public in this new partnership, called the Multilateral Initiative on 
Malaria, is strong evidence that the global community has recognized 
the magnitude of the malaria problem.
---------------------------------------------------------------------------
    \12\ World Health Organization. 1997. ``Weekly Epidemiological 
Record: September 5, 1997.'' Geneva: World Health Organization.
    \13\ World Health Organization. 1997. ``The World Health Report 
1997.'' Geneva: World Health Organization.
---------------------------------------------------------------------------
    At NIAID, we have strengthened our long-term commitment to malaria 
research. NIAID-supported malaria projects--many in collaboration with 
other government and international agencies--include a new repository 
of malaria research materials that are available to researchers 
worldwide; basic, field-based and clinical research on all phases of 
malaria research; and projects to determine the genetic sequences of 
important malaria species. In addition, new collaborations between 
intramural and extramural scientists on malaria vaccine research, 
production and evaluation are underway.
                           diarrheal diseases
    Like malaria, diarrheal diseases are leading killers of children, 
resulting in about 2.5 million childhood deaths each year.\14\ At least 
a third of these deaths are probably due to rotavirus, a disease for 
which NIAID researchers have developed an effective, orally 
administered vaccine. As recently reported in The New England Journal 
of Medicine, this vaccine, the culmination of more than 20 years of 
research, reduced severe diarrheal illness by 88 percent in a study of 
infants in Venezuela, a country where rotavirus circulates year 
round.\15\ The vaccine is nearing licensure in the United States and 
other countries, and promises to have a major impact on the health of 
children worldwide. In the United States alone, widespread use of the 
NIAID-developed rotavirus vaccine could greatly reduce the 500,000 
doctor visits \16\ and 100,000 hospitalizations related to rotavirus 
each year,\17\ as well as the $1.4 billion in direct and indirect costs 
associated with the illness.\18\
---------------------------------------------------------------------------
    \14\ World Health Organization. 1997. ``The World Health Report 
1997.'' Geneva: World Health Organization.
    \15\ Perez-Schael, I. et. al. 1997. Efficacy of the rhesus 
rotavirus-based quadrivalent vaccine in infants and young children in 
Venezuela. N Engl J Med. 337(17):1181-1187.
    \16\ Glass, R.I. et. al. 1996. The epidemiology of rotavirus 
diarrhea in the Untied States: surveillance and estimates of disease 
burden. J. Infect Dis. 174 (suppl 1): S5-S11.
    \17\ Institute of Medicine. 1985. ``New vaccine development: 
establishing priorities,'' p.410-423. In Diseases of importance in 
developing countries (Vol I). Washington, DC.: National Academy Press.
    \18\ Smith, J. et. al. 1995. Cost effectiveness analysis of a 
rotavirus immunization program for the United States. Pediatrics. 
96:609-15.
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                    the promise of new technologies
    Many of the advances I have described have been facilitated by 
rapid advances in molecular biology, notably the development of fast 
and accurate methods for sequencing the genomes of disease-causing 
microbes. Sequence information can be used in many ways, such as 
finding targets for therapies, identifying antigens to incorporate into 
vaccines, detecting mutations that cause drug resistance, and 
determining the factors that influence the virulence of a microbe.
    The success of the first microbe sequencing project--the 
delineation of the complete Haemophilus influenzae genome in 1995--
encouraged the Institute's current efforts to sequence the full genomes 
of eight other medically important bacteria. NIAID also supports 
projects to provide complete or partial genome sequences of large 
parasitic protozoa.
                      maintaining a research base
    The burden of infectious and immunologic diseases, in human and 
economic terms, is enormous. It is critical that we maintain a strong 
scientific infrastructure in core disciplines such as infectious 
diseases, immunology and microbiology to meet the challenges of these 
diseases. With skillful use of the increasingly powerful tools of 
molecular biology, by identifying research opportunities and priorities 
and vigorously pursuing them, and by sustaining a strong research base, 
we will be well-positioned to make further progress against current 
disease threats as well as the new diseases that will inevitably 
emerge.
                                 ______
                                 
                  Prepared Statement of Marvin Cassman
    Mr. Chairman and Members of the Committee, good morning. I am 
pleased to present to you the programs of the National Institute of 
General Medical Sciences (NIGMS). The President in his fiscal year 1999 
budget has proposed that NIGMS receive $1.115 billion, an increase of 
$77.6 million over the non-AIDS portion of the fiscal year 1998 
appropriation. Including the estimated allocation for AIDS in both 
years, the total support proposed for NIGMS is $1.145 billion, an 
increase of $79.5 million over the fiscal year 1998 appropriation. 
Funds for NIGMS efforts in AIDS research are included within the Office 
of AIDS Research budget request.
    The goal of NIGMS is to ensure the continuing productivity of basic 
biomedical research, which has provided the foundation for the 
astonishing developments we witness daily in the understanding and 
treatment of disease. In its 35-year existence, NIGMS has supported 
some of the most significant advances in biomedical science. One 
reflection of the success of NIGMS-funded research is the number of 
Nobel Prizes awarded to our grantees. Since 1962, we have supported 
almost 60 percent of all the American Nobel laureates in chemistry and 
physiology or medicine. Among these was the award in 1978 for 
understanding the way bacteria cope with foreign invaders, an esoteric 
study that would seem to have little practical value. Yet this work 
formed the basis for recombinant DNA technology, which underlies the 
biotechnology industry.
              from basic research to disease applications
    But we do not have to go back 20 years to trace the contributions 
of basic research. A number of striking developments have emerged in 
the past year alone, of which I have time to describe only a few. The 
examples I have selected all have in common that they began with the 
examination of a fundamental biological process in an organism other 
than humans, but quickly revealed applications to human disease. 
Indeed, the studies were not even done in mammalian organisms, but in 
much simpler systems such as bacteria, yeast, and the common fruit fly. 
There are obvious reasons why many biological processes cannot be 
studied in humans, and the use of these models is based on the repeated 
observation that many fundamental processes are common to a variety of 
species. Examining these phenomena in model organisms provides a 
detailed understanding that can lead to general principles with broad 
applications. The examples I will give show how studies in bacteria, 
yeast, and the fruit fly have generated knowledge that can be applied 
to Lyme disease, neurodegenerative disorders, and cocaine addiction.
    The first example is a study in an unusual bacterium that may lead 
to a therapy for Lyme disease. The bacterium is part of an esoteric 
class called archaebacteria, which are found in a variety of 
inhospitable locations such as ocean bottoms, hot acid springs, and 
high-salt environments. One of our investigators was interested in the 
very fundamental question of how this bacterium carries out protein 
synthesis, a universal requirement of all living organisms. It appeared 
that one essential component of protein synthesis was missing in the 
bacterium, and he was curious to see how the organism survived without 
it. It turns out that the component is present, but in a form unrelated 
to that found in all other bacteria and higher organisms. Or almost 
all. Careful examination of the genomic sequence of the organisms that 
cause Lyme disease and syphilis showed that in these pathogens there 
exist compounds with strong similarity to the material found in the 
archaebacterium, but these compounds are quite different from those 
with analogous functions in humans. Scientists could exploit this 
fundamental difference between a pathogen and its human host to develop 
new antibiotics to treat Lyme disease. Such antibiotics would attack 
the compound involved in protein synthesis in the bacterium without 
damaging this essential process in the human host. Parenthetically, 
this is but one illustration of the enormous value of having complete 
genomic sequences of organisms other than humans.
    A second example is a discovery in yeast that sheds light on 
certain kinds of neurodegenerative diseases in humans. This sounds 
inherently unlikely, and certainly could not have been predicted. After 
all, even if a yeast cell did have a form of dementia, how would we 
know? But this relationship between humans and yeast is in the apparent 
existence of prion-like particles in both organisms. Prions are thought 
to be infectious protein particles that are implicated in the 
initiation of so-called ``mad cow'' disease and other disorders. The 
1997 Nobel Prize in physiology or medicine was awarded to the scientist 
who championed the role of prions in disease. An NIGMS investigator has 
recently shown that there is a protein in yeast that has many of the 
same characteristics as the prions found in mammalian brains. For 
example, the yeast protein generates the same fibers formed by 
mammalian prions, which are comparable to those found in the autopsies 
of humans and animals that have died of diseases where prions were 
implicated. Furthermore, critical interactions with other materials in 
the cell are exactly the same for the yeast protein and mammalian 
prions. These studies now provide a model system to investigate an 
immensely complex problem in a comparatively simple organism, yeast. 
They even begin to suggest a new target for potential therapies.
    Finally, we arrive at the common fruit fly, an organism that has 
provided us with the opportunity to study many fundamental biological 
phenomena, particularly in the areas of development and gene 
regulation. One of our investigators has spent many years studying 
fruit fly genes that are involved in the nervous system and in 
behavior. Comparable genes in humans are involved in depression and 
other mental disorders, as well as in Parkinson's disease and drug 
addiction. In the course of his work, the scientist used volatile--or 
``crack''--cocaine as a tool to stimulate neurological responses in the 
flies, which led him to observe that flies and mammals respond to 
cocaine in strikingly similar ways. This time-lapse image shows one 
such similarity--the circling movement of a single fly following 
exposure to cocaine. Rodents and primates display similar movement 
patterns in response to the drug. This, along with other behaviors, 
suggests that both the fundamental neural pathways involved in cocaine 
response and the linkage to behavior are retained across species. As a 
result of this work, the fruit fly now appears to be a very promising 
model system to examine the genetic and molecular pathways leading to 
cocaine sensitization, as well as to investigate the pathways involved 
in a variety of neurological disorders.
    It is striking that in all of these examples, health-related 
applications emerged almost immediately from basic research studies. 
This is, of course, not the norm for most of the fundamental research 
studies that we support. And yet, it is not so far from the reality of 
modern biology. The mosaic of scientific research has expanded to the 
point at which basic research and its applications follow very closely. 
It is appropriate to remember a comment made by Louis Pasteur in 1871: 
``* * * there does not exist a category of science to which one can 
give the name applied science. There are science and the applications 
of science, bound together as the fruit to the tree which bears it.'' 
The examples I have given today describe a few such trees and their 
early fruits.
                     tackling biological complexity
    If the past and the present provided such a bounty of important 
outcomes from basic research that can be applied to the problems of 
health and disease, the future promises even more. The incredible 
volume of detailed knowledge about fundamental biological processes 
suggests that we may soon be in a position to understand the design 
principles of living systems. NIGMS has recently held two workshops to 
identify how we can facilitate progress in this difficult research 
area. Participants in both workshops were unanimous in their opinion 
that progress will require interdisciplinary approaches. However, a 
major barrier is the shortage of biological scientists who also have 
the quantitative and computational expertise that is needed for 
progress to be made. We are pursuing several approaches to address this 
shortage. We have already created a program to support mathematicians, 
physicists, and engineers in collaborative research projects with NIGMS 
grantees that are intended to develop new approaches to the study of 
complex systems.
    We are also planning two new training efforts in this area. One 
will provide individual postdoctoral fellowships to scientists with 
doctoral degrees in physics, mathematics, engineering, computer 
sciences, and related areas to allow them to be trained in basic 
biomedical research. The second will support courses and workshops 
designed to train biologists in computational and statistical methods.
    Another important goal is understanding individual variability in 
drug responses, a field sometimes described as pharmacogenetics. NIGMS, 
in collaboration with several NIH institutes, will soon convene a 
working group of scientists to help us define new research directions 
in this area. In the meantime, we are collaborating in the initiation 
of training efforts in clinical pharmacology, a discipline that is 
critically linked to pharmacogenetics and that has significant 
shortages of trained personnel.
                        training for the future
    We continue our efforts to train tomorrow's scientists and to bring 
more underrepresented minorities into careers in biomedical research. A 
new initiative that we are planning for the coming year is to enhance 
traditional postdoctoral training by promoting the development of 
teaching skills through innovative programs that involve assignments at 
minority-serving institutions. We feel that this initiative will 
provide several benefits. It will be of particular value to the many 
scientists who during their graduate careers become interested in 
teaching, but have little or no opportunity to develop those skills. At 
the same time, it will provide minority-serving institutions with 
access to individuals who are on the cutting edge of their disciplines, 
while relieving scientists at those institutions from some of their 
teaching burden and allowing them time for research and collaborations.
    The activities of the NIGMS are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    Thank you, Mr. Chairman. I would be pleased to answer any questions 
that you may have.
                                 ______
                                 
                 Prepared Statement of Duane Alexander
                             budget request
    I am pleased to present the fiscal year 1999 President's budget 
request for the National Institute of Child Health and Human 
Development (NICHD) of $654.7 million, an increase of $47.4 million or 
7.8 percent over the comparable fiscal year 1998 appropriation. 
Including the estimated allocation for AIDS in both years, total 
support proposed for NICHD is $727 million, an increase of $52.2 
million over the fiscal year 1998 appropriation. Funds for NICHD 
efforts in AIDS research are included within the Office of AIDS 
Research budget request.
                        research accomplishments
    Congress established the National Institute of Child Health and 
Human Development 35 years ago to help the people of this Nation have 
healthy children at the time they want them, and to help those children 
survive, learn, and develop in ways that allow them to reach adulthood 
free of disease and disability and able to contribute fully to society. 
As we have been celebrating our 35th anniversary, we have looked back 
at some of the accomplishments of our research that have made major 
progress toward achieving those goals for all American families. The 
list of our top achievements in those 35 years is impressive.
    For example, NICHD-supported scientists developed and demonstrated 
the effectiveness of newborn screening tests for phenylketonuria (PKU) 
and hypothyroidism. Every newborn infant in the United States now 
receives these tests, and thanks to their use we prevent over 1,200 
cases of mental retardation every year. Every parent whose child leads 
a normal life rather than being mentally retarded from these conditions 
can thank NICHD research.
    Another example is the NICHD Diabetes in Early Pregnancy Study that 
showed clearly that rigid control of a diabetic mother's blood sugar 
before and during pregnancy markedly reduced her elevated risk of 
having a stillborn or malformed infant. This regimen has now become 
standard care. Every diabetic woman who has a healthy baby can thank 
NICHD research.
    I have told this Committee before about the NICHD scientists who 
conceptualized and developed a conjugate vaccine to prevent Hemophilus 
influenzae type b meningitis. With this vaccine now standard care for 
infants, this disease has gone from the leading cause of acquired 
mental retardation in the United States, to near elimination. Every 
parent seeing their child immunized to protect it from this disease can 
thank NICHD research.
    Through a combination of improvements from NICHD research in our 
ability to care for premature infants, such as better ventilation, 
surfactant to prevent respiratory distress syndrome, improved 
nutrition, and better control of infection, the birth weight at which 
half of premature infants survive has fallen from around 1,800 grams 
when NICHD was established to approximately 800 grams today. During 
this same time, the Nation's infant mortality rate has fallen by 70 
percent. Every mother who takes a very low birth weight infant home 
from the hospital can thank NICHD research.
    Leading the way in the Nation's decline in infant mortality rate in 
the last four years has been a marked reduction in Sudden Infant Death 
Syndrome (SIDS) deaths. As shown in the graph, for many years SIDS 
deaths were remarkably stable at 5,400 per year, or 1.4 deaths per 
1,000 infant births. The research-based recommendation of the American 
Academy of Pediatrics in 1992 to place infants to sleep on their backs 
or sides rather than their tummies had only a small impact until the 
NICHD Back-to-Sleep campaign was launched in 1994. Since then, back or 
side sleeping has increased, and the rate of SIDS deaths has declined 
dramatically, with preliminary data for the first six months of 1997 
indicating a rate of 0.5 deaths per 1,000 births. This represents a 
reduction of nearly two-thirds from the old steady state condition. The 
3,000 fewer families each year who lose an infant to SIDS can thank 
NICHD research.
    Our staff at NICHD and the scientists we support are justly proud 
of these 35 years of scientific accomplishments and their translation 
to practice to improve public health. There has been a good return on 
the investment of the American people through the Congress in the 
research supported by this Institute. But there is much more we can do, 
and with your support and encouragement, we are hard at work on 
hundreds of other conditions that still need to be addressed.
                             birth defects
    While strides have made in reducing several causes of infant 
mortality, less is known about its leading cause: birth defects. Our 
studies here range from basic investigations in genetics and 
developmental biology, using a variety of animal models including mice 
and zebrafish, to epidemiological studies of cause, and therapeutic and 
prevention research. Basic studies are particularly important because 
they allow us to elucidate the underlying processes of normal 
development and to identify what goes wrong to cause birth defects and 
genetic diseases. The fact that genes are conserved throughout the 
animal kingdom has enabled us to translate the leads from basic studies 
in animal models to understand human disorders, such as neural tube 
defects, skeletal anomalies, primary immune deficiencies, and disorders 
in the formative stages of the nervous system that lead to mental 
retardation or learning and behavior problems.
                            vaccine research
    Progress in science is incremental, building on previous research. 
One example is the E. coli O157 vaccine. E. coli O157 is a bacterial 
food contaminant that causes mild to fatal gastrointestinal and renal 
disease in about 20,000 people a year. This new vaccine was produced by 
our same intramural scientists who developed the Hib vaccine mentioned 
earlier, using the same conjugate vaccine concept and technology. We 
recently reported success in inducing high levels of protective 
antibody production against E. coli O157 in adult volunteers. One 
intriguing aspect of this vaccine is that we may be able to prevent the 
disease in humans by eliminating the organism at its source by 
vaccinating cattle. Studies testing this concept are currently under 
way, as are field trials of a conjugate vaccine to prevent typhoid 
fever, and studies of a Shigella conjugate vaccine to prevent dysentery 
in children.
                            premature labor
    Applications of advances in genetics, especially from the Human 
Genome Project, continue to benefit NICHD as well as other Institutes. 
One case in point is microarray technology, which permits the study of 
thousands of genes at once to determine which are functioning (``turned 
on'') at a given time. Our scientists are beginning to apply this 
technology to study gene expression in women in premature labor, and 
comparing that pattern with pregnant women not in preterm labor, with 
the goal of determining at a genetic level the heretofore elusive 
causes and mechanisms of premature labor. These studies also offer the 
potential to develop a much-needed diagnostic test to determine whether 
a woman is truly in premature labor, as well as identifying targets for 
therapeutic intervention. Research to reduce prematurity is an 
essential part of our effort to eliminate racial differences in infant 
mortality as part of the President's initiative on race.
                   reading development and disability
    Other new scientific technologies are allowing us to combine 
studies in biology and behavior to achieve a fundamental understanding 
of the origins of problems and follow the course of treatment to assess 
how the underlying problem is corrected. Nowhere is this more dramatic 
than in the studies linking fundamental neurosciences and reading 
behavior. One technique being used is called functional magnetic 
resonance imaging, and has generated the pictures you see displayed on 
the poster. These are images taken during attempts at a reading-related 
task by a person with normal reading ability, on the right, and a 
person with significant reading disability on the left. The disabled 
reader shows none of the activity in the region at the back of the 
brain used by the normal reader in the reading task, and increased 
activity in the front area of the brain reflecting intense effort to 
overcome the apparent block in function at the early stages of the 
task. We are now engaged in remedial interventions with a large number 
of children with reading disability and will be retesting them after 
they learn to read to determine whether the treatment results in use of 
the same parts of the brain that children with normal reading ability 
use, or whether they develop alternative pathways that allow them to 
read. Meanwhile, our basic studies and clinical trials of reading 
intervention in the classroom are continuing and are proceeding well.
                             child day care
    Results of research on the association between characteristics of 
child day care (quantity, quality, stability) and children's social, 
cognitive, and language development continue to come from the NICHD 
Study of Early Child Care. This longitudinal study of over 1,300 
families is the most comprehensive and detailed study of child care 
ever undertaken. Adding to results described before, this year 
scientists continued to find that family income, quality of the home 
environment, maternal education or language ability, and mother's 
behavior toward the child are the best predictors of children's 
cognitive, language and social development. Scientists also reported 
that children in exclusive maternal care do not have a cognitive or 
language advantage over children in child care, and that those in 
center care actually tend to do better in those areas at age three than 
those in maternal care. For those children who are in child care, the 
researchers found that the more language stimulation children received, 
the better their cognitive and language abilities over the first three 
years of life. Children's self-control, compliance and problem 
behaviors were found to be only minimally predicted by child care: 
those in higher quality of care had somewhat more favorable outcomes in 
these areas than those in lower quality of care. The quality of care 
was also associated with better mother-child interaction over the first 
three years of life. While no relation emerged between the quantity of 
child care and children's psychological outcomes, more hours in care 
were associated with somewhat less optimal mother-child interactions 
over the first three years of life. In these interactions mothers were 
slightly less sensitive and responsive and the children were somewhat 
less engaged. Most recently, the investigators reported that 
characteristics of child care provision that can be regulated 
(adult:child ratio, group size, provider education and training) are 
related to cognitive and social outcomes of children at three years of 
age. All these findings taken together can help guide parents when they 
choose child care and policy makers when they make decisions about the 
support of families and child care programs.
                        women's health research
    With the funds provided by the Congress in fiscal year 1998 and 
requested for fiscal year 1999, the NICHD will launch two major 
initiatives to improve women's health. First, to increase the number of 
obstetrician-gynecologists engaged in research, the NICHD, with support 
from the Office of Research on Women's Health, is establishing a group 
of Women's Reproductive Health Research Career Development Centers. At 
these sites newly trained ob/gyn clinicians will be linked with mentors 
and research facilities and equipment and given training to assist them 
in pursuing research careers focusing on addressing problems of women's 
reproductive health. Without this help, we are losing many individuals 
interested in and capable of pursuing clinical research, and this 
program is intended to remedy that situation. Second, we are working 
with the ob/gyn community and other Institutes to expand significantly 
research directed toward the long-term consequences women suffer 
related to child bearing--incontinence, uterine and rectal prolapse, 
chronic pain, and other harmful and disabling conditions. Our studies 
will range from basic neuroanatomical and connective tissue research, 
to epidemiologic studies relating management of pregnancy and delivery 
to long term adverse outcomes, to studies of the most effective 
management and rehabilitation for these disorders. We should do all 
that we can to help women avoid these consequences of childbearing, and 
the increased funding requested in the fiscal year 1999 budget will 
help launch an initiative to address this under-researched area.
                         pediatric pharmacology
    There is great hope that the proposed new FDA rules requiring drugs 
potentially useful in children to be tested in children, in combination 
with the NICHD Pediatric Pharmacology Research Unit Network, will 
finally end the decades-long era of children being ``therapeutic 
orphans,'' forced to rely only on the results of drug tests in adults. 
To further facilitate the testing of drugs in children, the funds 
requested for fiscal year 1999 will allow NICHD to expand the Network 
to ten sites from the current seven, and to initiate a broad range of 
basic studies of child/adult and genetic differences in drug metabolism 
and response to different classes of drugs to help guide drug testing 
both in the Network and elsewhere.
    Mr. Chairman, these are just a few examples of how NICHD research 
is attempting to improve the health and well-being of women, children, 
and families. I will be pleased to answer any questions.
                                 ______
                                 
                   Prepared Statement of Carl Kupfer
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's fiscal year 1999 budget request for the National Eye 
Institute (NEI) a sum of $374 million, an increase of $28 million (or 
8.2 percent) above the comparable fiscal year 1998 appropriation. 
Including the estimated allocation for AIDS research within the Office 
of AIDS Research budget request, total support proposed for the NEI is 
$384 million, an increase of $28 million (or 8.1 percent).
    In recent years the American people--through their representatives 
in Congress--have shown great confidence in the National Institutes of 
Health. Americans have placed tremendous faith in NIH's ability to 
conduct and support high quality research for a wide spectrum of 
diseases and disorders. The NIH research community--and in our case, 
the NEI--is grateful for this vote of confidence. Both the NIH and NEI 
have gratefully accepted the challenge to improve the health of the 
American people.
                    laboratory and clinical research
    It is important to point out that laboratory research serves as the 
foundation for clinical, or patient research. Clinical research 
improves diagnosis and treatment, which is the ultimate goal of the 
NEI. For scientists to get to the clinical research stage, a great deal 
of supporting laboratory research must first be conducted. That is why 
a significant amount of our funding goes for such research. The results 
of these studies may be stepping stones to discovery of an effective 
treatment or a means of prevention.
    An excellent example of this bridge between laboratory and clinical 
research is the introduction of two new drugs used to treat glaucoma. 
Glaucoma, a major public health problem in the United States, is the 
leading cause of blindness in African-Americans. It is often associated 
with a rise in the normal fluid pressure inside the eye, leading to 
vision loss and even blindness. For many years, the NEI has supported 
laboratory research into the most effective drugs to control the flow 
of fluid into and out of the eye. This NEI-supported research led to 
clinical research, which resulted in the recent introduction by the 
pharmaceutical industry of two new FDA-approved glaucoma drugs--
lantanaprost and dorzolamide. With their increased effectiveness and 
reduced side effects, these new drugs add important options for the 
treatment of glaucoma.
    Other discoveries from laboratory research may provide significant 
insight into diseases seemingly unrelated to the original focus of the 
studies. An excellent case in point occurred at the NIH last Fall. 
Scientists searching for genes thought to be involved in resistance to 
cancer drugs discovered a gene that is expressed only in the retina. 
This led to collaboration between cancer and vision researchers and the 
discovery that this gene is linked to the most common juvenile form of 
macular degeneration, called Stargardt's disease. This disease affects 
about 25,000 Americans; develops primarily in people between the ages 
of six and 20; and leads inevitably to marked visual disability. This 
discovery may help researchers unravel the molecular mechanisms that 
lead to Stargardt's disease, which in turn may help unravel some of the 
mysteries surrounding the disease's adult form: age-related macular 
degeneration. The gene discovery also emphasizes in the strongest terms 
that the conduct of high quality research often leads to an 
unsuspected, but very valuable, addition to the medical literature. 
This knowledge can provide insight into related disease processes.
                    age-related macular degeneration
    Age-related macular degeneration, or AMD, is the leading cause of 
blindness in older Americans. AMD affects the macula, a tiny area in 
the retina that helps produce sharp, central vision required for 
``straight ahead'' activities such as reading, sewing, and driving. AMD 
cannot be prevented, and treatment is effective in only a small number 
of cases. It is estimated that AMD already causes serious visual 
impairment in approximately 1.7 million of the 34 million Americans 
over age 65. As the ``baby boom'' generation ages, and in the absence 
of further prevention and treatment advances, the prevalence of AMD is 
estimated to reach epidemic proportions of 6.3 million Americans by the 
year 2030.
    Although the fundamental cause of AMD remains elusive, we are 
making progress in our research. Several risk factors, including 
smoking, diet, cholesterol level, and genetic factors, appear to be 
associated with the disease. The NEI is conducting a large clinical 
trial, called the Age-Related Eye Disease Study, to assess whether 
antioxidants and/or zinc can slow down the development and progression 
of AMD. The NEI is also closely studying the possibility that 
deficiencies of two carotenoid antioxidants--lutein and zeaxanthin--may 
contribute to the development of AMD. The NEI convened a workshop of 
experts last month to develop a research approach that will best 
evaluate the effect of lutein and zeaxanthin on AMD.
                           neovascularization
    Neovascularization is the growth of new blood vessels in the retina 
and the major sight-threatening abnormality in diabetic retinopathy. 
During their lifetime, nearly half of all people with diabetes will 
develop some degree of diabetic retinopathy. The disease can blind as 
many as 25,000 people with diabetes each year. The NEI's continuing 
support for research on diabetic retinopathy has led to identification 
of several growth factors related to neovascularization. These growth 
factors may be stimulated by a lack of oxygen, causing new blood 
vessels to grow. The NEI is considering clinical trials on several 
pharmaceuticals that would inhibit the growth of these new blood 
vessels, and is working with the pharmaceutical industry in this 
effort.
                          biology of the brain
    NEI research covers many other diseases and disorders of the visual 
system. For example, we are expanding research on the growth and 
development of neurons in the visual system to allow damaged nerve 
cells to survive and reestablish their normal connections. About 38 
percent of all nerve fibers that enter or leave the brain pass through 
the two optic nerves which connect the eyes to the brain--and there are 
more than one million nerve fibers in each optic nerve. This is why 
research into preventing damage to these nerves and restoring their 
normal function is a major neuroscience research priority. Such 
knowledge is also applicable to other parts of the brain.
    Research into retinal degeneration will be expanded into 
understanding the mechanisms of cell death in the retina, which is the 
part of the eye that transmits visual information to the brain. 
Retinitis pigmentosa affects over 100,000 Americans and belongs to a 
group of inherited retinal degenerations that causes severe visual 
disability. We will expand our research into the therapeutic potential 
of growth factors that can either rescue damaged retinal cells or 
prevent degeneration from proceeding. A number of clinical trials will 
soon begin in this area. Other clinical trials are continuing to 
develop treatments that may prevent visual disability in very premature 
infants.
    The molecular and cellular mechanisms regulating the growth of the 
eye are being pursued aggressively, since elongation of the eye is the 
major cause of myopia, or nearsightedness. About 25 percent of the 
adult population in the U.S. is nearsighted, and this condition appears 
to become more prevalent with each subsequent generation. The NEI is 
conducting clinical trials to develop strategies that may slow down the 
development of nearsightedness.
                         other avenues of study
    An integral part of the NEI's research portfolio is providing 
funding to clinician scientists who are committed to a career in 
research and have the potential to develop into independent 
investigators. The Mentored Clinical Scientist Development Award 
provides an intensive, supervised research experience. Depending on the 
candidate's previous research experience, a three, four, or five-year 
plan may be proposed. The plan integrates classroom studies with 
``hands-on'' experience in the laboratory or in areas such as 
biostatistics and epidemiology.
    One of the most critical components of translating research in the 
laboratory to our use in everyday life is the public/private 
partnership that is actively pursued by the NEI. In an effort to 
quantify the direct benefits of basic research to commercial 
enterprise, the NEI reviewed vision-related patents granted since 1975. 
We found that eye technology innovation has grown steadily, with almost 
a fourfold increase in the number of patents granted, from 224 in 1975 
to 848 in 1996. The NEI is identified as the research sponsor for over 
30 percent of the scientific articles referenced by these patents. An 
even greater number of non-eye care patents make reference to NEI-
supported research, meaning that the commercial relevance of NEI 
research extends to technologies outside of the eye care arena.
                            quality of life
    The NEI is going beyond measuring patient health by the traditional 
standard of clinical outcome. We are also assessing a person's quality 
of life. We have developed a ``Quality of Life'' questionnaire that 
measures patients' perception of their own visual functioning. This 
questionnaire is intended to capture many aspects of visual disability 
that are identified by patients as being important for their daily 
activities. Patient outcome is not just what the doctor says it is--
it's also what the patient says it is.
    The NEI is supporting health services research as another way of 
improving patients' quality of life. Health services research is 
broadly defined to include topics such as increasing patient access to, 
and utilization of, vision care services. Health services research also 
includes improving the delivery of vision services by eye care 
professionals, and measuring the vision health of patients receiving 
eye care services. New health care technologies resulting from this 
research can allow physicians and patients to utilize the knowledge 
gained from clinical trial results. It can also help doctors and 
patients better understand quality of care and the cost effectiveness 
of care.
    The NEI, through its National Eye Health Education Program, is 
developing a program aimed at raising awareness about the impact of low 
vision on daily living. We broadly define low vision as any visual 
condition, not correctable by glasses or contact lenses, that impairs 
everyday function. Among the target audiences of the low vision program 
will be people over age 65 and health care and social service 
providers. The low vision program will be instrumental in informing 
Americans about low vision and how the use of visual devices and 
rehabilitative services can maximize remaining vision to improve a 
person's quality of life.
    The activities of the NEI are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan, which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    Finally, Mr. Chairman, I am proud to announce that the NEI has 
completed its sixth long-range plan for eye research. This five-year 
research plan outlines research strategies aimed at accomplishing our 
long range goals and objectives for each of our scientific programs.
    Mr. Chairman, I look forward to answering your questions.
                                 ______
                                 
                  Prepared Statement of Kenneth Olden
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the National Institute of 
Environmental Health Sciences (NIEHS) for fiscal year 1999, a sum of 
$348.1 million, an increase of $24.5 million over the comparable fiscal 
year 1998 appropriation. Including the estimated allocation for AIDS in 
both years, total support proposed for NIEHS is $354.8 million, an 
increase of $24.7 million over the fiscal year 1998 appropriation. 
Funds for NIEHS efforts in AIDS research are included within the Office 
of AIDS Research budget request.
             environmental health science and public policy
    As shown in Chart No. 1, the focus of my presentation is ``Bridging 
the Gap Between Environmental Health Science and Public Policy''. In 
most instances the scientific and technical information available today 
is inadequate to develop scientifically sound and comprehensive 
solutions to complex environmental health problems. Without better 
information, how can we direct resources to areas of environmental 
health and safety that will have the most significant impact on human 
lives?
    Might I ask, ``How many times during your tenure in the U.S. 
Congress have you faced the quandary of being asked to intervene in 
environmental health policy issues without the benefit of sufficient 
information? To make decisions with enormous public health and economic 
consequences?
    Just last summer I imagine that many of you were queried about the 
health effects of Pfiesteria following fish kills along our eastern 
shores. This is an important issue where the concerns of agribusiness, 
industry, tourism, and environmentalism are all potentially involved. 
As another example, many of your constituents have perhaps expressed 
concern about health effects of low level electric and magnetic fields. 
Your concern has certainly been voiced to me in the form of a directive 
in the 1992 National Energy Policy Act; as Director of the NIEHS, I am 
required to give to you this year a report on the possible risks of 
these exposures. Perhaps some of you have been involved in the recent 
discussions surrounding federal reference doses for mercury. This issue 
is particularly important because children are unusually sensitive to 
this neurotoxicant; thus, its presence in fish has special relevance to 
pregnant women and children. Also I suspect that many of you were 
involved in discussions surrounding new proposed ambient standards for 
ozone and particulate matter, which are being reassessed by the EPA as 
part of its requirements under the Clean Air Act Amendments of 1990. 
Finally, you will soon be asked to consider the Environmental 
Protection Agency (EPA) proposal to require detailed reporting about 
chemicals and potential health hazards in drinking water. While 
expansion of federal environmental ``right to know'' regulation for 
drinking water is in principle a good thing, can Americans make 
informed decisions given the magnitude of the data gaps in the 
toxicological profiles on the mixture of over 700 chemicals in the 
drinking water of the U.S.?
    What these few examples have in common is that, all too often, 
important public health decisions have to be made in the absence of 
adequate information. It is this inadequate information base, coupled 
with the undeniable economic costs of remediation, that continually 
forces those of you in Congress to determine where the balance should 
be between suspected public health effects of environmental exposures 
and the economic costs of reducing these exposures.
    The frequency of such quandaries indicate how important it is to 
invest in better science. By better, I not only mean more information, 
but I refer specifically to better data on how people differ in their 
susceptibility to environmental exposures, better data on the health 
effects of exposures to mixtures of chemicals rather than single 
compounds, better data on actual human exposures, better data on the 
mechanisms by which these exposures cause disease, and better methods 
to integrate all this information into regulatory standards. Although 
we have not reached this stage yet, I am convinced that the new 
cutting-edge technologies in genetics and cell biology position us to 
attain this ideal.
    Clearly we cannot fill gaps in data by flooding the void with 
brilliant assumptions about exposure, hazard potency, and 
characteristics of the population at risk. Instead we must make 
strategic investments that can lead us to the rational environmental 
health policies, as well as environmental protection policies, we will 
need for the 21st century and beyond. We at NIEHS have given great 
thought to what these investments should be, and I outlined some of 
them for you in last year's testimony. I would like to take this 
opportunity to provide a ``report card'' of where we now stand.
                       individual susceptibility
    First, I discussed last year how a person's risk differs according 
to their genetic makeup and the need for this information to improve 
risk assessment decisions. An Environmental Genome Project was proposed 
that could address this knowledge gap. I am pleased to report that a 
trans-NIH effort, involving 15 Institutes, is underway to investigate 
the genetic basis of environmental disease susceptibility. The 
discovery of susceptibility genes is critical to a better understanding 
of numerous diseases, and the development of efficacious and cost-
effective prevention and treatment strategies. Such studies will shed 
some light on the often asked question, ``Why me, Doc?'', and will help 
change the current one-size-fits-all approach to health care and 
environmental health and safety regulations.
                          exposure assessment
    Second, I noted that little is known about which compounds in our 
environment people are actually exposed to or how much of these 
exposures they absorb or store in their bodies. Recent advances in 
analytical techniques should permit detection of environmental and 
occupational chemicals in small samples of blood and urine. This past 
year the NIEHS has been developing an exposure assessment program, Body 
Burden 2000, that is evolving into a multiagency initiative involving 
the Centers for Disease Control and Prevention (CDC), Food and Drug 
Administration (FDA), EPA, Department of Defense (DOD), and others. 
Already we have experienced success in a pilot project with CDC 
designed to improve the exposure assessment of environmental endocrine 
disruptors. This information will be useful as regulatory agencies 
grapple with the issue of endocrine disruptors, particularly as they 
affect the health of children.
                       high throughput technology
    Third, I alerted you to the need for high throughput technologies 
for toxicologic testing. The last 50 years has witnessed the 
development of over 75,000 chemicals. Yet, according to a recently 
published Environmental Defense Fund report, ``even the most basic 
toxicity testing cannot be found in the public record for nearly 75 
percent of the top-volume chemicals in commercial use.'' (EDF, 1997). 
In a similar study, the National Academy of Sciences' National Research 
Council concluded that 78 percent of the highest-volume chemicals in 
commercial use ``had not had even minimal toxicity testing'' (NAS/NRC, 
1984). We are clearly in a state of toxic ignorance and it is not 
likely to be resolved by our current reliance on 2-year rodent 
bioassays. The NIEHS has made considerable progress in developing 
technologies that can eliminate, or at least reduce, the testing 
backlog that leads to this state of toxic ignorance. As I have reported 
to you previously, the NIEHS, under the auspices of the National 
Toxicology Program (NTP), is evaluating the predictiveness of novel 
transgenic mouse models. As you can see in Chart No. 2, we have tested 
close to 30 chemicals in transgenic mice and the results compare 
favorably with results from our traditional bioassay. Also, since 1997, 
all 2-year studies reported by the NTP are accompanied by results from 
parallel studies in transgenic animals. This program will greatly 
increase our ability to evaluate the best uses for transgenic models in 
regulatory decision making. Chart No. 3 shows the potential benefit of 
using the transgenic models in testing, primarily the fact that we can 
do these assays faster and at less cost. One of the most exciting 
aspects of this program is that it is being done in partnership with 
the pharmaceutical and chemical manufacturing industries. Based on 
progress with these alternative systems, the FDA is now allowing some 
test data to be submitted using transgenic animals.
    Relying on whole animal bioassays, even transgenic animals, will 
not completely solve our information deficit. The NIEHS is developing a 
new methodology, called computational biology, that allows regulators 
to use a variety of information--chemical structure relationships, 
tests in single cell systems, limited whole animal studies--to assess 
how environmental agents alter critical biological systems and cause 
disease. The regulatory community has already used several examples of 
this approach as a basis for improving risk assessments. The NIEHS 
plans to provide even more tools for rapid assessments and is hoping to 
exploit advances in recombinant DNA technology, combinatorial 
chemistry, and microarray technology.
                            complex mixtures
    The fourth strategic investment I discussed last year was the need 
to define health effects from exposures to complex mixtures, rather 
than the current system which only assesses effects of single 
compounds. The NIEHS will be funding university-based researchers 
throughout the country to address this critical research gap. I am 
confident that in the future I will have significant successes to share 
with you on the research outcomes of these studies.
                           children's health
    I would like now to discuss our fifth strategic investment--
children. As you know the developing child represents a particularly 
vulnerable target for adverse environmental effects. This Nation has 
been particularly vigilant in protecting its children at those times 
when solid, scientific information has been provided. The story of lead 
and its subsequent dramatic decline in children illustrates our 
determination to protect the child. This resolve, however, was only 
possible because of the firm scientific foundation provided by the 
research community, much of which was supported by NIEHS. The NIEHS 
continues to support research in the critical area of children's 
susceptibility to environmental agents.
    According to a recent report of the National Resources Defense 
Council (NRDC, 1997), the worst environmental threats to children's 
health include: lead, air pollution, pesticides, environmental tobacco 
smoke, and drinking water contamination. Other important health 
concerns include children's greater vulnerability to radiation-induced 
thyroid cancer, their susceptibility to the neurotoxicity of 
polychlorinated biphenyls (PCB's) which are frequent contaminants in 
fish, and their potential interaction with environmental endocrine 
disruptors released into our environment that have the ability to alter 
hormone functions.
    To address these problems the NIEHS is establishing Centers for 
Children's Environmental Health and Disease Prevention. Working jointly 
with the EPA and CDC, we have released an RFA to the research community 
that will establish Children's Environmental Health and Disease 
Prevention Centers to define the environmental influences on asthma and 
other respiratory diseases, childhood learning, and growth development.
    The incidence of childhood asthma is rising at an alarming rate, 
particularly among the urban poor. Common household allergens in the 
air may be contributing to this devastating disease. It remains to be 
proven if removing the allergens from a household will provide an 
effective remedy in reducing asthma attacks or incidence. These 
propositions are under examination in multicenter, multiyear studies 
sponsored collaboratively by the NIEHS and the National Institute of 
Allergy and Infectious Diseases (NIAID). This Inner-City Asthma Study 
is a prevention trial to develop a comprehensive and cost-effective 
intervention strategy to reduce asthma morbidity in inner-city children 
and adolescents.
    Given the NIEHS' interest in exposure assessment that I mentioned 
earlier, it is logical that we have added an exposure assessment study 
to complement this effort. This National Allergen Survey is being done 
in collaboration with the Department of Housing and Urban Development 
(HUD). It is a population-based, national survey of dust hazards in 
U.S. homes and will monitor for both allergens and lead. Our objective 
is to examine the relationship between allergen exposure and diseases 
such as asthma and allergies. This study will give us an estimate of 
allergen exposures in the general population, will estimate the 
magnitude of the allergen problem in the U.S., and will reveal how 
allergen exposures differ as a function of geographic region, 
socioeconomic status, housing type, and ethnicity.
                                summary
    In summary, I have articulated a series of strategic investments 
worthy of public support. Chart No. 4 outlines the seven steps needed 
to resolve our current state of toxic ignorance. The NIEHS, by 
implementing these programs, is leading the way to modernize risk 
assessment and bridge the gap between environmental health science and 
the public policy it serves. I would be happy to respond to any 
questions you may have.
                                 ______
                                 
                 Prepared Statement of Richard J. Hodes
    Mr. Chairman and Members of the Committee: The President in his 
fiscal year 1999 budget has proposed that the National Institute on 
Aging (NIA) receive $556 million, an increase of $38 million over the 
non-AIDS portion of the fiscal year 1998 appropriation. Including the 
estimated allocation for AIDS in both years, total support proposed for 
the NIA is $558 million, an increase of $39 million over the fiscal 
year 1998 appropriation. Funds for NIA efforts in AIDS research are 
included within the Office of AIDS Research budget request.
    I am pleased to have the opportunity to highlight the efforts 
undertaken by the NIA to extend through research the healthy, active 
years of life for all Americans. For nearly a quarter of a century, the 
NIA has led the scientific effort to comprehend aging processes, 
producing many advances that enhance the quality of life and prevent 
costly disease and disability. Such discoveries have come at an 
opportune time. Facing a century in which 75 million babyboomers will 
turn 65, we all stand to gain from a healthy, fully engaged older 
population. Aging research is key to achieving this goal.
                      alzheimer's disease research
    The NIA leads an intensive effort to conquer Alzheimer's disease 
(AD), a progressive brain disorder marked by an irreversible decline in 
intellectual abilities and by changes in behavior and personality. As 
the most common cause of dementia in older people, AD affects as many 
as four million Americans, with devastating effects to patients, their 
families, caregivers, and society. Fortunately, the pace of research 
findings is accelerating. For example, several studies point to the 
protein fragment beta-amyloid, a major component of the plaques that 
litter the spaces between nerve cells in the brains of AD patients, as 
having a key role in the neuronal destruction in AD. The process 
involved, however, has remained a mystery. This year, NIA grantees 
provided evidence that a newly-identified protein binds with the beta-
amyloid, and that this process may contribute to neuronal dysfunction 
in AD. Grantees also recently identified a new pathological feature of 
AD brains, a plaque-like lesion that contains a previously unknown 
protein which could potentially provide a new diagnostic marker and 
improve understanding of the causes of AD. The recent generation of 
genetically engineered transgenic mice that express mutant human genes 
associated with AD and exhibit AD-like behavioral deficits and brain 
lesions may serve as a much needed animal model for the study of AD.
    Based on research world-wide, people who inherit a particular type 
of apolipoprotein E (ApoE4) are recognized to be at special risk for 
the late onset form of AD. NIA grantees are therefore investigating the 
potential use of genetic testing for ApoE in the clinical diagnosis of 
AD. Results indicate that ApoE genotyping, although not sufficiently 
sensitive or specific alone as a diagnostic test for AD, may reduce the 
number of incorrect diagnoses by close to 30 percent when administered 
after a clinical evaluation. In a related study, scientists have found 
differences with respect to ApoE among African-Americans, Hispanics, 
and Whites. A 5-year, prospective, longitudinal study showed that, in 
the absence of ApoE4, the cumulative risks of AD to age 90 were four 
times higher for African-Americans and twice as high for Hispanics as 
for Whites. In the presence of ApoE4, the cumulative risk to age 90 was 
similar for individuals in all three ethnic groups. These results 
suggest that while the ApoE4 allele is a determinant of AD risk in 
Whites, the other two groups have an increased risk of AD regardless of 
their ApoE genotype, and that other genes or risk factors may 
contribute to the risk of AD in African-Americans and Hispanics.
    In the critical effort to identify effective treatment for AD, 
studies reported in the past year have identified three new candidate 
interventions--antioxidants, non-steroidal anti-inflammatory drugs 
(NSAID's) such as ibuprofen, and estrogen replacement therapy. Two of 
these studies used 15 years' worth of data from NIA's Baltimore 
Longitudinal Study of Aging, now in its 40th year. The first study 
linked use of NSAID's with an approximately 50 percent reduced risk of 
AD. The second study associated a history of estrogen replacement 
therapy in postmenopausal women with approximately a 50 percent 
reduction in the risk of AD. Based on these and previous findings, the 
NIA plans to initiate clinical trials to test the effectiveness of 
ibuprofen and of estrogen vs. placebo in treatment or prevention of AD. 
In addition, NIA-supported researchers completed a placebo-controlled, 
randomized prospective clinical trial to assess the effect of the 
antioxidants vitamin E, selegiline, or the combination on progression 
of moderately impaired AD patients. The trial showed that selegiline 
and vitamin E may slow development of functional signs and symptoms of 
AD by several months, although they did not affect cognitive measures. 
This study provided the basis for a newly planned novel secondary 
prevention trial to test whether high dose vitamin E slows the 
conversion to AD in people with mild cognitive impairment (that is, 
having a memory deficit but no dementia). This is the first trial 
designed to delay AD onset.
                            biology of aging
    Advances in basic biology have fueled a revolution in aging 
research. A notable example of this progress is the award of the Nobel 
Prize in Medicine to Stanley B. Prusiner, a long-time grantee of the 
NIA, the National Institute of Neurological Disorders and Stroke 
(NINDS), and other NIH components. Dr. Prusiner was cited for his once-
controversial discovery of prions, ``an entirely new genre of disease-
causing agents,'' that cause ``mad cow'' disease and other lethal 
brain-wasting conditions. His laboratory's latest findings involve the 
mode of transmission of ``mad cow'' disease between species and the 
forms of prions associated with clinical disease.
    Rapid progress has also been made on identifying genes that affect 
longevity in lower organisms. One of these genes (daf-2) regulates 
life-span in the worm Caenorhabditis elegans. A mutation in this gene 
can more than double the worm's life-span, if a second gene (daf-16) 
assists in the process. The daf-2 gene codes a protein equivalent in 
function to the human insulin receptor, part of a nutrient-sensing 
pathway the worm uses to monitor and alter its metabolism. These 
findings imply that the same biological system used by the worm for 
metabolic regulation could also be central to delaying the aging 
process and extending worm longevity. If this scenario is valid, the 
finding may help explain why rodents who eat a diet that is 
nutritionally balanced but 30 percent reduced in calories live 30-40 
percent longer, stay active and healthy until late in life, and have 
fewer malignancies than do rodents not calorically restricted. In 
addition, these findings may advance understanding of how human insulin 
regulates metabolism and why this regulation fails in diabetes. To 
benefit from these discoveries, the NIA plans a new initiative to 
identify genes that modulate the rate of aging in humans. These 
findings are expected to yield insights into both aging and age-related 
diseases.
    Major new advances have been made in understanding the role of 
telomeres and telomerase in aging and cancer. Telomeres, repetitive DNA 
segments found on the ends of chromosomes, help maintain chromosomal 
integrity and function. When cells divide, telomeres normally lose 
segments and shorten until, at a critical length, cell division ceases 
and cells become senescent. The enzyme telomerase compensates for 
telomere loss by adding DNA segments to the ends of chromosomes. This 
process rarely takes place in normal human cells, where telomerase 
response is absent or insufficient. In 80-90 percent of human tumor 
cells, however, telomerase activity is robust, and cells divide 
endlessly. How and why telomerase reactivates to contribute to cell 
immortalization is not known. But the correlation between telomerase 
activation and cancerous growth has stimulated many scientists to view 
telomerase inhibition as a potential new approach to cancer therapy. In 
recent months, scientists discovered and cloned the gene for the active 
subunit of human telomerase, making possible the critical study of how 
telomerase activity is regulated. Scientists have now inserted copies 
of the newly-cloned gene into normal, telomerase-negative cells in the 
laboratory, causing these cells to express telomerase. In contrast to 
the normal cells, which exhibit telomere shortening and cessation of 
cell division, the telomerase-expressing cells had elongated telomeres 
and have continued to replicate far beyond the limits observed for 
normal cells. These results confirm that telomere shortening causes 
cellular senescence under laboratory conditions. The ability to avoid 
senescence in normal human cells is expected to have important 
applications in research and medicine.
                    reducing disease and disability
    As life expectancy increases, there is an urgent need to keep these 
additional years disease- and disability-free. Cardiovascular disease 
and cancer, as the two leading causes of mortality in the elderly, are 
important research targets. The only common cardiovascular disease now 
increasing in prevalence in the U.S. is heart failure, and a chief risk 
factor for this disease is isolated systolic hypertension. The NIA and 
the National Heart, Lung and Blood Institute supported a controlled 
clinical trial to test the effectiveness of low doses of the diuretic 
chlorthalidone to treat systolic hypertension in older people. Older 
people who were treated in the trial had 50 percent less heart failure 
than those not treated. The chance of developing heart failure dropped 
even more for persons who had previously had a heart attack, an 
improvement of 80 percent. Treatment of isolated systolic hypertension 
with this relatively inexpensive medication could make major 
differences in quality of life and save substantial medical costs. The 
NIA also collaborates with the National Cancer Institute on cancers in 
older people, including breast and prostate cancer. Using data from the 
BLSA, NIA scientists and colleagues have produced several important 
advances about the role of prostate specific antigen (PSA), an enzyme 
useful for detecting and indicating the aggressiveness of prostate 
cancer. Some PSA binds proteins in the blood, and some PSA remains 
free, or unbound. At the time of cancer diagnosis, the ratio of free to 
total PSA in blood may predict whether the cancer will be fast or slow-
growing. This can help the physician decide whether to treat or monitor 
the cancer. Avoiding unnecessary treatment, such as radiation or 
surgery, may reduce complications, including impotence and 
incontinence, as well as reduce health care costs.
    NIA research also focuses on mobility and freedom from pain in 
older people. Loss of bone mass due to osteoporosis contributes to 1.5 
million fractures each year in the U.S., according to a recent article 
in the publication Bone. An NIA controlled trial studied the effect of 
dietary calcium and vitamin D supplementation in maintaining bone 
density and preventing fractures in older men and women. This regimen 
prevented bone loss at all skeletal sites and was associated with a 50 
percent reduction in the rate of symptomatic nonvertebral fractures. 
This underlines the importance of older persons' maintaining adequate 
levels of calcium and vitamin D to minimize bone loss. Osteoarthritis, 
a painful degenerative joint disease, also affects millions of older 
Americans. A controlled trial conducted at an NIA Older Americans 
Independence Center proved that walking and resistance exercises can 
safely improve function and reduce pain in patients with knee 
osteoarthritis, suggesting that exercise should be prescribed as part 
of the treatment for these individuals.
    Supplements of hormones and hormone-like molecules, such as 
melatonin, DHEA, testosterone, and growth hormones, are of growing 
popular interest. Claims have appeared in the news that taking such 
supplements can make people feel young again or can prevent aging. 
Unfortunately, these claims have not been proved, and the wrong balance 
of hormones can be dangerous. The NIA is conducting research to define 
the biologic action of these hormones and to assess the clinical 
utility of replacement therapy of hormones that tend to decline, on 
average, with age. For example, research has focused on understanding 
observed age-related declines in testosterone, which could contribute 
to decreased muscle and bone capacity, and the biology of the 
menopause, which is associated with pathology such as increases in 
osteoporosis and cardiovascular disease. This initiative has great 
potential for developing effective strategies to promote strength and 
prevent disability in older men and women.
                     behavioral and social research
    Behavioral and social research is instrumental in enabling older 
people to maintain or enhance physical and cognitive function and be 
fully engaged in life. The NIA also has consistently supported research 
to encourage long-term behavior changes that decrease risk of disease 
and disability. A new NIA centers initiative is increasing 
understanding of aging and improving health status in older minority 
populations, complementing the efforts of other centers that are 
developing strategies to keep people active and productive in late 
life. Significant progress is also being made on understanding and 
influencing changes with age in cognitive function. This year, a 
landmark study that compared identical and fraternal twins over age 80 
found that the contribution of heredity to cognitive ability remains 
very strong, approximately 50 percent, even in old age. These results 
contradicted hypotheses that predicted an increased impact of 
environmental factors with age in determining intelligence.
    The NIA also monitors the impact of population aging on disease and 
disability. Demographic research has shown that there are at least 1.4 
million fewer disabled older persons in the U.S. than there would have 
been if the disability rates of the elderly had not improved since 
1982. Further studies will identify and quantify the specific 
underlying causes contributing to the decline. Additional analysis will 
involve the dynamics of old-age life expectancy, projections of the 
support ratio, and health expenditures, as well as the implications of 
trends in health, disability, and life expectancy for national policies 
on retirement and programs for the elderly.
    The NIA will continue to identify initiatives that maximize 
scientific and management efficiency and that have the potential for 
placing successful aging within everyone's reach. I would be happy to 
answer any questions.
                                 ______
                                 
                 Prepared Statement of Stephen I. Katz
    Mr. Chairman and Members of the Subcommittee: I am pleased to 
present the President's budget request for the National Institute of 
Arthritis and Musculoskeletal and Skin Diseases. Including the 
estimated allocation for AIDS research in both years, total support 
proposed for the NIAMS is $295.6 million, an increase of 7.6 percent 
over the fiscal year 1998 appropriation. Funds for NIAMS efforts in 
AIDS research are included within the Office of AIDS Research budget 
request.
    benefits of medical research in bones, joints, muscles, and skin
    Medical research has demonstrated time and again the genuine 
difference it can make in many dimensions of people's lives. While the 
Congressional Justification is full of such research advances, and I am 
very enthusiastic about and proud of those achievements, I want to 
focus today on my outlook for the future. What will life be like a 
decade from now if we invest in the bright scientific minds and in the 
unprecedented tools of medical research that are available to us today? 
What difference can it make in people's lives when we wisely invest the 
funds proposed in our fiscal year 1999 budget?
    You have heard in my testimony in the past that virtually every 
household in America is affected by some disease or disorder of the 
bones, joints, muscles, and skin--and that these diseases take an 
enormous toll on one's quality of life. Because our research mandate is 
quite broad and diverse, progress realized from research that we 
support has the potential to benefit virtually every household in 
America. We hear a lot about the concerns of baby boomers and the aging 
of the American population. I would like to sketch out some dimensions 
of what life could look like if the research we are supporting, 
conducting, and planning realizes its full potential.
    Imagine a future where quality of life is not compromised by old 
age or pain and suffering * * * where people are productive and 
independent well into their senior years. Bone fractures seriously 
compromise quality of life, and they are often a consequence of 
osteoporosis--a thinning of bones--that constitutes a major public 
health problem. We have learned an enormous amount about how bones 
become strong and that they are constantly being built up and broken 
down. This past year, in an important series of discoveries, 
researchers supported by NIAMS and the National Institute of Dental 
Research identified a gene essential for the buildup of bone--thereby 
opening up exciting opportunities for the development of potential new 
bone strengthening interventions to prevent bone fractures. This 
finding has clear implications for osteoporosis, Paget's disease, 
osteogenesis imperfecta, and other bone diseases. Move now to the 
schools. We are heartened to see children and adolescents benefitting 
from programs targeting their strong bones and reducing their sports 
injuries. We know that calcium is critical for maintaining integrity of 
bones and that people build up their bone ``bank account'' during the 
first three decades of life. During the past year, in studies in 
Mexican-American girls, we learned how the vitamin D receptor gene is 
related to bone mineral density, and why some girls may be more 
susceptible to low bone mineral density. We look forward to 
developments that will alter or reverse this susceptibility.
    Move now to the beach and other recreational sites. Here we see 
people of all ages enjoying time outdoors while taking informed and 
proven precautions to avoid skin cancer caused by sunlight exposure. 
During the past year, we have learned more about how certain mutated 
genes cause skin cancer, the most common form of human cancer, and we 
are now trying to understand how these effects might be reversed or 
altered.
    Move now to the doctor's office and other sites of health care. We 
see people clearly benefitting from better diagnostic tools, improved 
medical devices, and more effective treatments with fewer side 
effects--all derived from research. We are supporting studies of a 
number of technologies, such as MRI to identify early osteoarthritis 
and bone implant engineering to design bone and joint replacements with 
greater longevity. Move now to the world of information. People will 
continue to derive their information from many, diverse sources. My 
goal is that current, reliable information will be available to all of 
these people regardless of the venue they choose. When patients 
understand their disease, they can make sound decisions about their 
health care, and they can be empowered by the sense that they control 
their disease * * * their disease does not control their lives. We are 
working toward a world where pain and suffering are significantly 
reduced, where disabilities less frequently compromise daily life, 
where women and minorities are no longer disproportionately affected by 
so many diseases, and where quality of life and productivity are 
routinely experienced at high levels. Is this an ambitious vision? 
Absolutely. Is it really achievable? I think it is. Now I would like to 
share with you other examples of progress as well as our initiatives.
              additional research advances and initiatives
    One of the most rewarding aspects of my job as Director of the 
NIAMS is the opportunity to report on the research advances we have 
supported over the last year. In arthritis, we know much more about 
changes that occur in cartilage cells lining the joints in people with 
osteoarthritis, and we are focusing increased emphasis on identifying 
appropriate markers to determine the diagnosis, prognosis, or severity 
of osteoarthritis. Recently, we have learned how certain genes are 
turned on and produce products that cause cartilage cells to die. Until 
recently, it was very difficult to propagate cartilage cells in a test 
tube, but certain growth factors have now been identified that enhance 
cartilage cell growth. These findings provide important scientific 
opportunities for increasing our understanding of osteoarthritis.
    A major overarching category of diseases under study in our 
Institute is autoimmune diseases, those in which the body's own cells 
turn against the body and cause diseases such as rheumatoid arthritis, 
systemic lupus erythematosus, Sjogren's syndrome, alopecia areata, 
scleroderma, and others. We are making progress in all of these, and 
advances in understanding one of these diseases has implications for 
all of them. Studies in tumor suppressor genes--long an integral 
component of cancer research--have revealed new insights into 
rheumatoid arthritis. Investigators have reported this year that 
synovial tissue from the joints of severe chronic rheumatoid arthritis 
patients contain a mutated tumor suppressor gene that controls the 
growth of normal cells. This may, in part, account for the chronic 
overgrowth of joint-lining cells in rheumatoid arthritis.
    Another important discovery was made by researchers in our NIAMS 
Intramural Research Program who identified the gene responsible for the 
disease called Familial Mediterranean Fever (FMF). Attacks of this 
disease are characterized by inflammation as manifested by arthritis, 
chest pain, abdominal pain, recurring bouts of fever, and skin rashes. 
This discovery will provide important insights into the causes of 
inflammation in FMF and many other inflammatory diseases, and provide 
for new and improved treatment for this and perhaps many other diseases 
characterized by inflammation. Funds provided in fiscal year 1999 will 
facilitate the development of animal models, diagnostic tests, and 
further identification of specific mutations in these patients. These 
brief highlights provide a glimpse of the hope that research offers for 
the many people suffering from the common, costly, crippling, and 
chronic diseases within the mandate of the NIAMS.
       value of being a part of the national institutes of health
    One of the strongest assets we have as an Institute is being a part 
of the National Institutes of Health. We share a common goal and 
commitment--improving the health of the American people--and we work 
together toward that end. Very frequently you will hear about diseases 
that are supported by many different institutes. For example, research 
on osteoporosis is supported by some 14 different components of the 
NIH. Such an approach is not duplicative, but complementary. We all 
approach our studies from a different perspective, but the goal is 
improved understanding of and strategies to reduce osteoporosis. With 
complex diseases like fibromyalgia, we often take a multi-pronged 
approach. We support basic studies in understanding the disease process 
and the troubling symptoms that people with fibromyalgia experience. We 
support innovative scientific workshops (as we did in July 1996) to 
enable basic researchers who never heard of fibromyalgia, but are 
conducting the latest research on sleep disorders or pain, to talk to 
clinicians who see patients with fibromyalgia every day, but are 
stymied in how to improve their lives. We then consider the 
recommendations from such a workshop and develop and implement 
strategies based on these recommendations. Again, using the example of 
fibromyalgia, as a result of that scientific workshop, the Institute is 
issuing a request for applications for exploratory and developmental 
grants in this area, targeting the pressing research questions in this 
area. Similar approaches have been utilized for many other diseases, 
including rheumatoid arthritis, osteoarthritis, systemic lupus 
erythematosus, scleroderma, low back pain, repetitive motion disorders, 
and various skin diseases. We ask what is the best strategy for 
understanding each disease and how we can improve the lives of 
patients. Over and over again, we have seen how research in one area 
significantly informs our understanding of other diseases. That is why 
it is so essential to support studies across the research spectrum.
       partnerships with voluntary and professional organizations
    In addition to our interactions with our colleagues across the NIH, 
we have also partnered with our colleagues in several voluntary and 
professional organizations. I am very pleased with the three new 
partnerships that have been developed this past year. The first is a 
novel partnership with the Arthritis Foundation, the National Institute 
of Allergy and Infectious Diseases, and the Office of Research on 
Women's Health to support a national consortium of 12 research centers 
in the search for genes that determine susceptibility to rheumatoid 
arthritis. The Arthritis Foundation not only provides financial 
support, but plays an invaluable role in patient recruitment and in 
increasing awareness of this study, the largest such effort in the 
world. The NIAMS also has partnered with both the American Society for 
Bone and Mineral Research and the S.L.E. Foundation to co-fund grants. 
Such arrangements benefit both components--the voluntary and 
professional organizations benefit from the NIAMS' expertise in grant 
review, and the Institute is able to support more studies than would be 
possible without the co-funding. When we share common goals, as we do 
in the examples just cited, the partnerships are clearly beneficial--
for the public, the voluntary groups, and the NIAMS.
    The future: challenges and plans
    What are the challenges to reaching the vision of the future that I 
described earlier and how do I plan to invest the budget to address 
those challenges? The increased budget will allow the NIAMS to support 
more research grants in key areas of opportunity and need, and we will 
expand our research portfolio in a number of priority areas. For 
example, we will explore specific opportunities to learn more about 
skeletal morphogenesis and growth, mechanisms of central nervous system 
damage and cardiovascular disease in systemic lupus erythematosus, 
hematopoietic (blood cell forming) and immune system effects on bone 
physiology, gene therapy for arthritis and skin disease, and structural 
biology of muscle membrane proteins. The NIAMS convened four working 
groups this year--in arthritis, bone, orthopaedics, and skin--to 
discuss clinical research needs and opportunities. There is a serious 
challenge in the field of clinical research, where problems include a 
shortage of people trained to do clinical research, and a shortage of 
people in the pipeline pursuing a career in clinical research. For 
example, our clinical panels expressed concern about the scarcity of 
individuals in NIAMS-related specialties, such as rheumatology, 
particularly pediatric rheumatology, as well as the dearth of 
physicians doing research in bone endocrinology, orthopaedic surgery, 
and dermatology. Our ability to derive maximum benefits from medical 
research will be seriously compromised if we do not address these 
shortfalls. Clinical researchers provide a vital bridge for translating 
bench research to bedside improvements, as well as translating bedside 
insights into bench opportunities. The new initiatives launched by the 
NIH in clinical research training and career development will help 
address important public health needs in NIAMS-mandated areas. I am 
confident that this aggressive and proactive approach will make a 
genuine difference in medical research in the future.
    The activities of the NIAMS are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    In closing, I want to express my gratitude to the members of this 
subcommittee for their strong and unwavering support of medical 
research. I hope that ten years from now we will be able to speak about 
the benefits that medical research has enabled--that we will be able to 
enjoy progress in all aspects of the lives of the American people. I am 
focused on that goal--the research we are supporting, conducting, and 
planning is aimed at achieving that goal. I am optimistic that we are 
on the way to achieving that goal.
    My colleagues and I will be happy to respond to any questions you 
may have.
                                 ______
                                 
               Prepared Statement of James F. Battey, Jr.
    Mr. Chairman and Members of the Committee: I am honored to appear 
before you as the newly appointed Director of the National Institute on 
Deafness and Other Communication Disorders (NIDCD). Several members of 
Congress were actively involved in the creation of the NIDCD nearly ten 
years ago. As you envisioned, NIDCD has become the focal point of 
research in human communication supported and conducted by the Federal 
government in the fifty states. In the last several years, in my role 
as the NIDCD's Scientific Director, I was part of the Institute's 
growth and development, whose goal is to advance knowledge about the 
mechanisms and processes of human communication, and revolutionizing 
prevention and treatment of disease and disorder. The President in his 
1999 budget has proposed that the National Institute on Deafness and 
Other Communication Disorders receive $213.8 million, an increase of 
$14.9 million over the non-AIDS portion of the fiscal year 1998 
appropriation. Including the estimated allocation for AIDS in both 
years, total support proposed for NIDCD is $215.7 million, an increase 
of $15 million over the fiscal year 1998 appropriation. Funds for NIDCD 
efforts in AIDS research are included within the Office of AIDS 
Research budget request.
   communication skills at the center of successful life in the new 
                                century
    Communication skills will be central to a successful life in the 
new century for all Americans. For the 46 million Americans with 
communication disabilities, however, getting up and facing each day is 
a challenge. The simple acts of speaking, listening, of making their 
wants and their needs understood, are often impossible. For the 
individual who has vertigo, or the person who finds himself or herself 
suddenly unable to hear, the days are challenging. For those who cannot 
speak without stuttering or for those who are unable to express ideas 
clearly after suffering a stroke, for those who cannot use their voices 
to talk with a friend on the phone due to the devastation of throat 
cancer--each day is challenging. The days are challenging for the child 
who has autism. They are also a challenge for the individual who cannot 
participate in activities because his or her tinnitus has become 
overwhelming. For an older person a loss of balance can result in falls 
and fractured bones, and a loss of hearing results in isolation. For 
the young child who begins a struggle with language, that if not for 
intervention, will be a lifelong struggle--communication disabilities 
pose a constant challenge. NIDCD made important progress in the 
disorders of human communication this year and has identified new 
targets, new tools and new teams for accelerating discovery in fiscal 
year 1999.
                       new tools: sensory imaging
    In reviewing the progress of the past year, the advances made in 
human communication research are frequently based upon new tools, new 
targets and new teams of scientists looking at research in novel ways. 
For example, we now have the ability to see the brain at work during 
human communication through the use of powerful imaging tools. Much of 
the human brain is used for hearing, balance, voice, speech and the 
manipulation and production of language, as well as the ability to 
smell and to taste.
           imaging provides first objective view of tinnitus
    Having the ability to image brain activity patterns during various 
communication events involving stuttering, aphasia, tinnitus, and 
American Sign Language is revolutionizing our understanding of normal 
and disordered processes of human communication. In one of many 
remarkable advances this year, NIDCD scientists are able to visualize 
brain activity occurring with tinnitus, or ringing in the ears. 
Tinnitus has been extremely difficult to study without an objective 
model as it is associated with virtually every kind of hearing loss. 
These studies provide ground-breaking information about the nature of 
tinnitus, which will hopefully lead to improved strategies for 
diagnosis and treatment for the millions of Americans challenged with 
the incessant or intermittent audiotory sensation that is tinnitus.
                sensory hair cell regeneration progress
    NIDCD-supported scientists are determining the properties of unique 
sensory cells of the inner ear called ``hair cells.'' [Exhibit 1: 
Sensory Hair Cells] These cells are critical for converting mechanical 
energy from sound or motion into electrochemical signals sent to the 
brain. Loss of hair cells is frequently the cause of hearing impairment 
and balance disorders. NIDCD-supported scientists are studying the 
molecular mechanisms underlying hair cell regeneration in animal model 
systems with the ultimate goal of using this information to restore 
hair cells in individuals with hearing impairment and balance 
disorders.
                   cochlear implants restore hearing
    In a different way, NIDCD scientists are trying to restore hearing 
through support of the development of the cochlear implant. The 
cochlear implant is a sensory neural auditory prosthesis that improves 
economic and social outcomes for post-lingual hearing impaired 
individuals. [Exhibit 2: Cochlear Implant and Figure A: Inner ear and 
cochlear implant] Here is a modern cochlear implant. Let me show you 
how it works. Part of it is surgically implanted within and behind the 
ear and the other components are worn. The implant bypasses the 
nonfunctioning hair cells in the cochlea and stimulates the auditory 
neural pathway. The prosthesis also includes a voice processor that has 
been designed to sample and convert sound at high speed and through a 
brilliant speech processing strategy. As an indication of how well this 
implantable prosthesis works, many who become suddenly deaf in mid-
career are now able to remain in their jobs. These individuals are able 
to use the telephone again after learning to use the implant through 
rehabilitation training.
     early identification of deaf and hard of hearing infants and 
                        development of language
    NIDCD has continued to investigate the development of language, 
signed or spoken, in children who are deaf or hard of hearing. NIDCD-
supported scientists have shown that the first six months of life 
represent a crucial period for subsequent development of language 
either spoken or signed. A number of states are implementing universal 
newborn hearing screening which begins with a test for auditory 
function very soon after birth. In 1998, NIDCD-supported scientists 
will complete a five-year study showing that two screening methods, 
measurement of otoacoustic emissions and auditory brainstem responses, 
can be used to accurately identify these deaf and hearing-impaired 
newborns. These research results will provide much needed guidance for 
implementing universal newborn hearing screening.
             progress in understanding olfactory reception
    The olfactory receptor gene family has about 1,000 members. More 
than five years ago, scientists discovered this large, multi-gene 
family, but had difficulty proving that these receptors responded to an 
odorant. An NIDCD-supported laboratory has shown that a member of the 
multi-gene family first identified as encoding a putative odorant 
receptor does indeed code for a protein that is capable of specific 
odor binding leading to a physiological response. Using a recombinant 
adenovirus, scientists were able to direct expression of a particular 
receptor gene in an increased number of rat olfactory neurons. 
Electrophysiological recording showed that increased expression of a 
single olfactory receptor gene increases odor and sensitivity to a 
small subset of odorants. These studies provide the basis for 
additional research that will correlate olfactory receptor structure 
with odorant responses.
      new approach for children with specific language impairment
    NIDCD has also made progress in studying specific language 
impairment (SLI) in hearing children. Specific language impairment, or 
SLI, is a deficit in language acquisition found in the absence of other 
cognitive impairment, and is present in about 8 percent of American 
school age children. SLI is a common cause of poor academic performance 
and frustration with learning. For a long time the focus of research 
was upon language and language strategies. Within the last few years, 
however, NIDCD-supported scientists have determined that SLI is often 
caused by a specific inability to process rapidly changing auditory 
information, such as occurs in some normal human speech. These findings 
will allow a more precise diagnosis of SLI, and suggests new 
intervention strategies to help children with SLI.
   molecular genetics collaboration provides key to form of hearing 
                               impairment
    Molecular genetics is revealing genes involved in many disorders of 
human communication. The search for hearing impairment genes is greatly 
facilitated by the timely, collaborative information exchange among 
different NIH Institutes working with a common purpose. For example, 
when a gene for a syndrome consisting of hearing impairment coupled 
with thyroid abnormalities was identified by a National Human Genome 
Research Institute scientist, this information was shared with NIDCD 
intramural investigators. The NIDCD scientists used the information to 
show that different mutations in the same gene also causes recessive 
non-syndromic hereditary hearing impairment in some families.
     improved understanding of the cause of recurrent otitis media
    As every parent knows, otitis media or middle ear infection, is the 
most frequent reason that a sick child visits either emergency rooms or 
physicians' offices, and the estimated cost of treating otitis media is 
$5 billion a year. Otitis media appears to be increasingly resistant to 
conventional antibiotic therapy. One of the most difficult aspects of 
treating otitis media is that relapses often occur within several weeks 
of antibiotic treatment. This clinical problem was difficult to 
explain, since most middle ear effusions showed no evidence of 
bacterial infection when cultured. Using a molecular biology technique 
(polymerase chain reaction assays), NIDCD scientists were able to 
detect the presence of bacterial mRNA in a significant number of 
culturally sterile middle ear effusions. This established the presence 
of viable organisms in some culture-negative Otitis Media with 
Effusion. Scientists believe that these elusive bacteria exist in 
biofilms, a kind of bacterial community that contains intact but 
indolent organisms deep within the film and away from antibiotics. 
Otitis media may serve as an ideal model for studying the role of 
biofilms in other recurrent infectious disease.
                  new teams: velocardiofacial syndrome
    In addition to new tools and new targets, new teams of scientists 
are providing collaborations for progress. NIDCD is convinced that 
multidisciplinary teams of scientists working together will be most 
effective in understanding the basis for human communication disorders. 
The NIDCD has already observed the benefit of this kind of 
collaboration. Velocardiofacial syndrome (VCFS) is a genetic disorder 
resulting in cardiac malformation and cleft palate, which has direct 
impact upon human communication skills. A team of NIDCD-supported 
scientists including molecular biologists, human geneticists, 
otolaryngologists, and cardiologists are searching for the gene or 
genes that cause VCFS. They are also developing better tools for 
diagnosis and treatment. This multi-disciplinary team is a model for 
future partnerships among clinicians and scientists. NIDCD sees an 
opportunity to support similar teams who will work together to 
understand the biology and genetics of voice, speech, and language 
disorders, and translate this understanding into improved diagnosis and 
better intervention strategies.
     new nih collaborative teams: nidcd supports autism initiative
    NIDCD was pleased to cooperate on an important autism initiative. 
Autism is a common developmental disorder found in children, affecting 
as many as one child in 1,000. One of the most striking problems these 
children face is the inability to communicate with other people. NIDCD 
has joined three other Institutes (National Institute of Child Health 
and Human Development, National Institute of Mental Health and National 
Institute of Neurological Disorders and Stroke) to support research to 
identify the genes that underlie autism, as well as to develop more 
effective intervention strategies. In another collaborative effort, 
NIDCD is working at defeating cancer of the head and neck. Each year, 
tens of thousands of Americans develop cancer of the head and neck. 
Conventional treatment using surgery and radiation therapy is often 
less than fully effective and results in destruction of organs critical 
for human speech. Clearly, better treatment modalities are needed. 
NIDCD has partnered with the National Cancer Institute and the National 
Institute of Dental Research to conduct and support research to 
determine the molecular mechanisms critical for the pathogenesis and 
progression of these malignancies. Cancer of the head and neck is 
unusual in that the scientist can watch the progression, remission or 
treatment effectiveness directly. In addition, these three institutes 
will work together to translate these basic scientific discoveries into 
more effective treatment options, sparing organs critical for human 
communication.
             nidcd collaborates for hearing aid improvement
    NIDCD is collaborating with the Department of Veterans Affairs and 
the National Aeronautics and Space Administration to improve hearing 
aids and sponsored a workshop to showcase technologies existing in 
Federal laboratories to facilitate transfer of those technologies that 
could improve the function of hearing aids. NIDCD looks forward to 
funding applications from multidisciplinary collaborations designed to 
improve speech signal processing for hearing aids.
                                new plan
    The pace of biomedical research advance is accelerating. To stay 
ahead, NIDCD is launching an accelerated planning process that will 
seek the collective ideas of the scientific community as to where the 
greatest need and opportunity lie in human communication research. New 
tools, new targets, and more importantly, new teams of investigators 
will be needed to rapidly and effectively seize the remarkable 
opportunities before us. We look forward to expanding our understanding 
of the biology and genetics of human communication disorders that 
affect 46 million Americans, and translating that knowledge into better 
strategies for diagnosis, early intervention and treatment. Thank you.
    My colleagues and I will be happy to respond to any questions you 
may have.
                                 ______
                                 
                 Prepared Statement of Steven E. Hyman
    Mr. Chairman and Members of the Committee: The President in his 
fiscal year 1999 budget has proposed that the NIMH receive $701.8 
million, an increase of $52.4 million over the non-AIDS portion of the 
fiscal year 1998 appropriation. Including the estimated allocation for 
AIDS in both years, total support proposed for NIMH is $809.7 million, 
an increase of $59.5 million over the fiscal year 1998 appropriation. 
Funds for NIMH efforts in AIDS research are included within the Office 
of AIDS Research budget request.
             excessive disability stems from mental illness
    Mental illness is a serious burden for the American people and for 
the entire world. Data from the landmark Global Burden of Disease study 
sponsored by the World Health Organization, the World Bank, and the 
Harvard School of Public Health clearly establishes the enormous 
contribution of brain disorders to disability. Iin developed countries 
such as the United States, four of the leading ten causes of disability 
are mental disorders. As Figure 1 shows, these four are unipolar major 
depression, schizophrenia, manic depressive illness and obsessive 
compulsive disorder. Also on this list, however, are alcohol use, 
dementia, stroke, and drug use. When one adds these conditions to the 
four mental disorders that I mentioned, eight of the ten leading causes 
of disability are seen to be brain and behavioral disorders. In the 
United States, the leading cause of disability is unipolar major 
depression, a serious disorder that affects 5 percent of Americans at 
some point in their lives.
    Serious depression often begins early in life, and reoccurrences 
throughout life are the rule. While the popular press recently has made 
much about the widespread use of antidepressants in the U.S., we should 
not be misled into thinking that the extent of use is evidence that all 
cases of major major depression are identified accurately and treated 
appropriately. Indeed, all available data tell us otherwise. Despite 
remarkable strides in developing treatments for depression, which 
compare favorably with treatments for almost any other chronic 
affliction of human kind, we are still unable to achieve full 
remissions or prevent recurrences in a disturbing fraction of 
sufferers. Also, the age of typical first onset of major depression 
vividly illustrates why mental disorders contribute so much to the 
burden of disability in the United States and worldwide. Mental 
disorders often begin early in life--if not in childhood, then most 
often in young adulthood, often at a time when a young person is just 
completing his or her education and society has a maximal investment in 
that young adult's future productivity.
    With schizophrenia, too, and other severe disorders, again we have 
made remarkable recent progress in the palliation of symptoms. Still, 
it is the rare and exceptional individual with this illness who attains 
the level of independence and productivity that they would have 
achieved but for the onset of illness. These facts underscore a point 
that I make often but which, in the face of continuing widespread 
misunderstanding and stigma in our society, bears repetition. Mental 
disorders are real brain disorders, they are diagnosable, and we have 
treatments that make an extraordinary difference in the lives and 
productivity of many of the victims. Although research on mental 
disorders has much yet to accomplish, we have made encouraging progress 
in understanding and developing treatments, particularly for the most 
severe forms of illness. Unfortunately, this progress may be overlooked 
given the tendency of the popular media and even some mental health 
professionals to conflate the kind of mental stress and distress which 
we all suffer intermittently with serious mental illness.
    Let me turn from this discussion of the burden of mental illness to 
two examples of progress that have been made during the last year, one 
in the area of basic science, and one in the clinical realm.
            mechanisms of cellular memory in mental illness
    On prior occasions, I have had opportunity to speak to you about 
the importance of genetic vulnerability in the production, or origins, 
of mental illness. Today, I would like to describe to you how the brain 
records experience in a way that contributes not only to the formation 
of normal memories of many types but which can also contribute to the 
onset and maintenance of illness in genetically vulnerable individuals. 
Let me begin by noting that the hundred billion or so nerve cells in 
our brains each may make thousands of connections with other nerve 
cells. These connections, which are called synapses, are the 
fundamental units, or sites, of information transfer. Whenever we 
remember something, whenever we record an experience in our brains, the 
physical structure of our brains is altered. We are learning that 
memory is the result of the physical changes in these synaptic 
connections! When we learn, the connection between some nerve cells is 
strengthened while connections between others are weakened. Research 
funded by several NIH Institutes, including NIMH, has revealed that 
structural changes that occur at the synapse when we learn are mediated 
by complex but highly orchestrated patterns of molecular change. Using 
a variety of animal models, including mice with experimentally altered 
genes, we have learned many details about the precise molecules that 
are involved in the recording of different kinds of memory, including 
explicit, conscious memories. What has remained elusive, however, has 
been the ability to correlate actual learning due to experience with 
its major physiologic signature of increased synaptic strength, a 
signature which goes by the name of long-term potentiation or LTP.
    Several months ago, two separate research groups provided evidence 
for this long suspected correlation between increased synaptic strength 
and a behaviorally significant form of memory. This discovery was made 
not with the kind of memory associated with thinking or cognition, 
however, but with the memory associated with emotional experience. This 
important insight into mechanisms by which experience alters brain 
structure occurred during the course of investigations of learned 
fear--specifically, its neurobiologic correlates in a part of the 
brain, the amygdala, that processes emotion. Figure 2 illustrates the 
information available through the use of functional magnetic resonance 
imaging, or fMRI. This image vividly represents activation of the 
amygdala in response to pictures that are designed to elicit negative 
emotions, including fear. The data here show a composite increase in 
the magnetic resonance signal during the presentation of negative 
pictures, when compared with neutral pictures. Knowing how memories of 
fear are coded in the brain represents significant progress on the path 
toward a fuller understanding of normal brain function; for our 
purposes at NIMH, it also is a very important step on the path to 
understanding how panic attacks (which are experiences of spontaneous, 
overwhelming fear) lead to the disabling constriction of life which 
goes by the name of agoraphobia; similarly, the information already has 
shed light on the means by which overwhelming trauma often leads to 
long-term symptoms that may disable a person in many domains of life. 
Indeed, knowledge about the role of memory in emotional processing may 
be a valuable step toward understanding the severe anxiety symptoms 
that often occur in major depression. Most importantly, the discovery 
suggests specific strategies for developing novel treatments for each 
of the conditions I have listed. For one, the discoveries permit us to 
focus neuroimaging tools on the human brain with the aim of obtaining 
increasingly precise pictures of what goes wrong in the brain in mental 
illness. In addition, knowing precisely where in the brain information 
processing events occur and the mechanism by which they are recorded 
may permit us to develop highly targeted treatments.
                research focus on clinical interventions
    Even as we continue to make fundamental progress in understanding 
brain function and dysfunction, we are embarked on an ambitious program 
of clinical research with the goal of improving the lives of patients 
with mental disorders. As part of a reorganization of NIMH's extramural 
programs that we undertook last year to revitalize the Institute's 
attention to mental illness in the context of new science, I created a 
new funding division that will focus exclusively on our public health 
mission of improving treatment and prevention interventions. Given the 
pace of basic science, accompanied by new attention to 
``translational'' research that seeks to apply fundamental knowledge of 
brain mechanisms to clinical uses, I believe that new treatments will 
become available at an increasing pace. We must ensure that such 
treatments find their appropriate place in clinical practice. Thus, an 
important challenge for NIMH, which we address principally through our 
new Division of Services and Intervention Research, is to find out what 
treatments work in children, in adults, in the elderly, and the 
circumstances or conditions under which they can be delivered most 
effectively. This Division also disseminates information to the public 
and to health care providers on proven treatments for mental illness.
        advances and challenges in treating childhood depression
    I would like to highlight a study that shows progress but at the 
same time points to the need for continued research. Last November, 
NIMH-funded investigators reported on a major clinical trial that 
documented the efficacy of the antidepressant, fluoxetine (Prozac), in 
children. This well-conducted trial demonstrated convincingly that 
pharmacologic treatments are indeed efficacious in children, as 
measured by stringent standards of clinical outcome, safety, and 
tolerability of the medication. The medication clearly worked but, at 
the same time, the response rate was not as high in children as it is 
in adults. This reduced efficacy is a matter of concern since older, 
so-called tricyclic antidepressants have not proven efficacious in 
children. Thus, while we have one proven treatment, the development of 
novel, more effective treatments, including psychotherapies 
specifically designed for children, remains an urgent priority. We must 
also examine why we so often fail to identify children with depression 
and how children gain access to treatment. And, drawing on our 
capacities to look at very fine brain structures, we must study very 
carefully the impact of both depression and antidepressant treatments 
on the developing brain.
                        nimh research priorities
    What are NIMH's priorities for the coming year? A wealth of 
scientific opportunities forces us to be very judicious in selecting 
areas for special focus and investment. In addition to modernizing and 
expanding the field of childhood mental disorder research--a task that 
entails attention to research training needs--and supporting clinical 
trials for children, an important priority is clinical trials of new 
treatments for schizophrenia. Several fundamentally new medications for 
schizophrenia that were designed on the basis of what we know about the 
neurobiology of the illness are coming onto the market and it is 
imperative that we address outstanding questions about their most 
appropriate use. Another priority is prevention research. Just last 
month, the Mental Disorders Prevention Research Workgroup, which under 
the aegis of the National Advisory Mental Health Council conducted an 
in-depth review of our portfolio, presented its final report. From the 
Workgroup's recommendations, the Institute will assign high priority to 
such under-researched areas as the prevention of suicide, with 
particular emphasis on suicide in older individuals.
    We continue to emphasize the search for genes that produce 
vulnerability to schizophrenia, manic depressive illness, early onset 
depression, and other mental disorders. The Genetics and Mental 
Disorders Research Workgroup of our Advisory Council has issued a 
concise list of recommendations in areas that extend from creating and 
analyzing the necessary large samples of DNA and clinical data from 
families with high rates of certain mental disorders, to fostering 
collaborations across NIH, to sponsoring new NIMH initiatives in the 
genetics of mental disorders. We have implemented or are in the process 
of implementing, these recommendations--guidance that I find very 
helpful as we grapple with the enormous difficulties posed by the 
complexity of genetic vulnerability to mental disorders.
    Research on brain development is a critically important priority 
for the Institute. While developmental neurobiology is a thriving 
field--and, indeed, I had occasion earlier this year to testify before 
the House subcommittee on issues of brain development and mental 
disorders--I am aware of important gaps in our knowledge base. Our 
progress in understanding emotional memory demands that we learn more 
about the development of those parts of the brain involved in 
processing emotion and integrating thought with emotion, brain regions 
that are critically involved in mental disorders. In partnership with 
the NINDS and several other NIH Institutes, we have initiated a 
project, called the Brain Molecular Anatomy Project, or B-MAP. The goal 
is to identify all genes that are expressed in the brain, using 
emerging gene discovery technologies. Knowing where genes are used in 
the brain is a first step in understanding what they do in cells and 
how they interact with other genes and environmental signals. This 
information will prove invaluable as we investigate the normal and 
abnormal changes that occur in the human nervous system at various 
stages of life.
    In accordance with our National Mental Health Advisory Council 
report on Basic Behavioral Science, we have launched an effort that 
will bring to bear the benefits of behavioral science on critical 
public health issues including prevention of mental disorders. AIDS is 
an urgent area in which NIMH-sponsored behavioral science research 
already has had a salutary effect. Behavioral research has much to 
offer in efforts to enhance treatment adherence and compliance and in 
the development of new psychotherapies, which we need particularly to 
tailor to children and older people, which is especially important 
given the value of psychotherapy as a complement to pharmacotherapy in 
many serious mental illnesses.
    Formidable gaps in our knowledge remain, but we have increasingly 
powerful tools to close them and make progress in the interest of 
Americans with mental illness.
    My colleagues and I will be pleased to respond to any questions you 
may have.
                                 ______
                                 
                 Prepared Statement of Alan I. Leshner
    Mr. Chairman and Members of the Committee: The President in his 
fiscal year 1999 budget has proposed that the National Institute on 
Drug Abuse receive $395.1 million, an increase of $35.3 million over 
the comparable 1998 appropriation. Including the estimated allocation 
for AIDS, total support provided for NIDA is $576.3 million an increase 
of $49.1 million over the fiscal year 1998 appropriation. Funds for 
NIDA efforts in AIDS research are included within the Office of AIDS 
Research budget request.
                          nida accomplishments
    I am pleased to report that during these historic times for 
science, the National Institute on Drug Abuse (NIDA) has had another 
year of exceptional accomplishment, as NIDA-supported researchers made 
enormous strides toward improved understanding, prevention and 
treatment of one of our Nation's most serious public health problems--
drug abuse and addiction.
    We now know more about abused drugs and the brain than is known 
about almost any other aspect of brain function. New technologies and 
new knowledge have revolutionized our insight into the brain. I mean 
this in the most literal sense. Using functional magnetic resonance 
imaging (fMRI), we have moved beyond a single snapshot of a brain high 
on drugs to being able to actually look at the dynamic changes of the 
brain that occur as an individual takes a drug. We can observe the 
different brain changes that occur as a person experiences the 
``rush,'' the ``high,'' and finally the craving of a commonly abused 
drug like cocaine.
    We are also using imaging technology to explore what neurochemical 
changes are occurring during addiction. As shown in Figure 1, using 
Positron Emission Tomography (PET) technology we can now see what 
tobacco smoking is doing to the human brain. Here you can see in the 
brain of the smoker a tremendous decrease in the levels of an important 
enzyme known to be responsible for breaking down dopamine, called 
monoamine-oxidase-A (MAO-A). This decrease in MAO-A actually results in 
an increase in dopamine levels. This may be a reason that smokers 
continue to smoke--to sustain the high dopamine levels, which result in 
the sensation of pleasure.
    At an even more refined level, NIDA-supported scientists have 
identified one of the critical brain proteins that mediates nicotine 
addiction. Scientists pinpointed the beta 2 subunit of the nicotinic 
cholinergic receptor as being essential to the process of nicotine 
addiction. Using bioengineering tools, these researchers produced a new 
strain of knockout mice which lack this important protein. In contrast 
to normal mice, mice without this receptor did not self administer 
nicotine, though they did take cocaine. This clearly demonstrates that 
the brain reward pathway thought to be common to all addictions remains 
intact, even though nicotine itself loses its pleasurable effect.
    These findings support a convergence of data which show that 
nicotine, just like cocaine, heroin and marijuana, all work to elevate 
levels of the neurotransmitter dopamine in the brain pathways that 
control reward and pleasure. It is this change in dopamine that we have 
come to believe is a fundamental characteristic of all addictions.
                   averting a methamphetamine crisis
    Dopamine activity is central to one of the country's most alarming 
emerging drug problems, methamphetamine abuse. The use of this highly 
addictive drug, once dominant primarily in the Southwest, is spreading 
rapidly across the country. As shown in Figure 2, just a decade ago 
methamphetamine was confined to relatively limited pockets of use in 
the West. It is now spreading through the mid-West and becoming an 
emergent new problem in previously ``untouched'' cities.
    This is of particular concern because of recent research 
demonstrating the neurotoxic effects of the drug. In non-human primates 
exposed to methamphetamine doses that are routinely used in human 
abusers, scientists have found profound effects on both the brain's 
dopamine and serotonin neurotransmitter systems. These long-lasting 
neurochemical effects are thought to be partly responsible for the 
severe behavioral abnormalities that accompany prolonged use of this 
drug. To avert a potential methamphetamine crisis, we need to develop 
effective medications to treat the addiction, as well as new tools such 
as anti-methamphetamine antibodies to be used by emergency room 
physicians to treat the growing number of overdoses.
    We are confident that we will be able to develop effective 
treatments for methamphetamine, just as we have for other serious drug 
addictions such as heroin and nicotine. We have effective addiction 
treatments in our clinical toolbox and countless others that are being 
tested, although admittedly not enough. We do already have methadone 
and LAAM (levo-alpha-acetyl-methadol) for opiate or heroin addiction, 
and will be seeking approval for both buprenorphine and buprenorphine 
combined with naloxone in 1998. For tobacco addiction, there are 
several nicotine-replacement therapies, such as the patch and gum, and 
several non-nicotine ones as well, such as bupropion (Zyban) that are 
readily available.
                          treating addictions
    We do not, yet, have a medication to treat cocaine addiction, which 
remains both a national need and a NIDA priority. But we do have 
encouraging news. We are about to launch our first ever large scale 
multi-center clinical trial for a cocaine medication. In designing this 
trial we are capitalizing on a body of current findings that suggest 
that medications consistently work better when they are used in 
combination with behavioral therapies. When we initiate the trial in 
the Fall we will add a standardized behavioral component to one of our 
most promising compounds, selegeline.
    NIDA hopes to expand upon this trial by launching a National Drug 
Treatment Clinical Trial Network to ensure that all potential addiction 
treatments are tested in real life settings. Our science has matured to 
the point where we can take a more systematic approach to rapidly and 
efficiently test the effectiveness of behavioral, psychosocial and 
pharmacological treatments in large-scale, multi-site clinical trials.
    Although it can be done, addiction is not a simple disease to 
treat. Addiction is a chronic relapsing disease that results from the 
prolonged effects of drugs on the brain. It can affect every aspect of 
a person's life. This is why an individual's treatment program must 
address not only the individual's drug use, but also help restore their 
abilities to function successfully in society. The most effective 
treatment approaches must attend to all of addiction's biological and 
behavioral components.
    It is these kinds of research-based concepts and approaches that 
are most needed by the frontline clinicians who are facing the day-to-
day realities of treating their patient's drug addictions. We know that 
we cannot just disseminate research findings through journal articles 
in the hopes that a busy treatment provider will have time to read, 
analyze and implement a particular finding. That is why we translate 
these findings in a way that is both useful and used by treatment 
providers at every level. Toward this end, NIDA is sponsoring a 
National Conference on Drug Addiction Treatment next month. At this 
conference, NIDA will release the first two in a series of treatment 
manuals developed to help drug treatment practitioners provide the best 
possible care that science has to offer. The manuals take 
scientifically-supported therapies for addiction and offer detailed 
guidance on how to implement them in real-life practice settings.
                    replacing ideology with science
    Undertakings like these exemplify our commitment to sharing 
research findings with the broadest community possible. An example of 
the positive impact that our research findings can have on society is 
seen in the recent efforts by many of our criminal justice colleagues 
to provide treatment to prison populations. NIDA-funded scientists have 
demonstrated that comprehensive treatment of drug-addicted prison 
inmates, when coupled with treatment after release from prison, reduces 
by 70 percent the probability of their being rearrested and the 
likelihood they will return to drug use.
    Other important societal issues were addressed through a number of 
major conferences that NIDA supported such as our National Heroin 
Conference, and NIH's Consensus Development Conference on Effective 
Treatment of Heroin Addiction. Additionally, we are continuing to take 
our science to the true beneficiaries of our research endeavors--the 
American public. We joined with local partners across the country to 
sponsor a series of Town Meetings. Our April Town Meeting with the 
citizens of Boston will coincide with the March 29th premier of an 
outstanding five part series on addiction that Bill Moyers and his 
staff at National Public Television have produced. NIDA has provided 
substantial technical assistance in the development of this series and 
its accompanying educational materials.
    We at NIDA want to replace ideology about drug abuse and addiction 
with science. We also want to provide the public with the necessary 
tools to play an active role in preventing drug use in their own local 
communities. Last year I showed you what has now become one of our most 
popular publications--``Preventing Drug Use Among Children and 
Adolescents''. This user-friendly guide of principles summarizes 
knowledge gleaned from over 20 years of prevention research. Over 
150,000 copies have been circulated to communities throughout the 
country as they evaluate existing prevention programs and develop new 
ones.
           preventing drug use among children and adolescents
    Understanding what makes a person more susceptible to a potential 
drug problem, and progression from first drug exposure to developing 
addiction, will enable us to much more effectively target our 
prevention efforts. Just as important, however, is the identification 
of protective factors, those behaviors, environments and activities, 
that seem to enable many people to avoid drug use altogether, or get 
right back on track if they falter or relapse during treatment.
    We are also supporting research that focuses on the special needs 
of older children and adolescents who have been placed in juvenile 
court detention programs, dropped out of school, or have become 
homeless. It is particularly important that we find effective 
prevention and treatment approaches for these special populations in 
light of a 1998 study which found that 13-19 year-olds who have both 
conduct and drug abuse problems, already are meeting standard adult 
criteria for marijuana dependence.
    We are also continuing to study the effects of prenatal drug 
exposure. We are finding that some, though not all, of the cohorts of 
crack-exposed babies now entering elementary and middle school may be 
significantly, although perhaps subtly, affected. Because these effects 
can be subtle and expressed only as children develop, long-term follow-
up is needed. Longitudinal studies will also enable us to examine 
whether prenatally drug-exposed children are more vulnerable, or at 
increased risk for drug abuse in childhood and adolescence.
                       genetics of drug addiction
    Determining who is at most risk for addiction will be a critical 
research area addressed through NIDA's new Genetics of Addiction 
Initiative. A culmination of NIDA-supported family and twin studies, 
coupled with neurobiological and molecular breakthroughs, has provided 
us with the confidence to more aggressively explore the role of 
genetics in drug addiction. NIDA's multi-faceted approach in this 
endeavor will include the use of genome-wide scans, linkage and 
association studies in humans, and the continuation of animal studies 
to test and confirm the role of new candidate genes.
             government performance and results act [gpra]
    NIDA's activities are covered within the NIH-wide Annual 
Performance Plan required under GPRA. The fiscal year 1999 performance 
goals and measures for NIH are detailed in this performance plan and 
are linked to both the budget and the HHS GPRA Strategic Plan which was 
transmitted to Congress on September 30, 1997. NIH's performance 
targets in the Plan are partially a function of resource levels 
requested in the President's Budget and could change based upon final 
Congressional Appropriations action. NIH looks forward to Congressional 
feedback on the usefulness of its Plan, as well as to working with 
Congress on achieving the NIH goals laid out in this Plan.
               understanding the complexity of addiction
    All of these exciting research efforts are moving us closer to 
truly understanding the complexity of addiction. It is only through a 
multi-disciplinary approach will we be able to unravel the remaining 
mysteries of addiction. NIDA will continue to use the most 
sophisticated research equipment and techniques, and seize all 
scientific opportunities that present themselves to ensure that no more 
lives are lost to what is ultimately both a preventable and, if not 
prevented, a treatable disease. I will be happy to answer any questions 
you may have.
                                 ______
                                 
                   Prepared Statement of Enoch Gordis
    Mr. Chairman and Members of the Committee: The fiscal year 1999 
President's budget request for the NIAAA is $230,243,000, an increase 
of $17.5 million over the fiscal year 1998 appropriation. Including the 
estimated allocation for AIDS, total support proposed for NIAAA is 
$245,730,000, an increase of $18.6 million over the fiscal year 1998 
appropriation. Funds for NIAAA AIDS research are included in the Office 
of AIDS research budget request.
                         problem of alcoholism
    Alcoholism is one of our country's most serious and persistent 
health problems. Approximately two-thirds of all American adults (ages 
18 and older) drink an alcoholic beverage during the course of a year 
\1\. At least 13.8 million American adults develop problems from 
drinking.\2\ Our young people, for whom alcohol remains the number one 
drug of abuse, also are at risk for developing alcohol-related 
problems. Recently published data from NIAAA's National Longitudinal 
Alcohol Epidemiologic Survey, which assesses lifetime risk for alcohol 
use disorders (alcohol abuse and alcohol dependence), provides 
convincing evidence that the younger the age of drinking onset, the 
greater the chance that an individual at some point in his or her life 
will develop a clinically diagnosable alcohol use disorder. As shown on 
Chart 1, young people who began drinking before age 15 are four times 
more likely to develop alcohol dependence during their lifetime than 
those who began drinking at age 21.
---------------------------------------------------------------------------
    \1\ Midanik LT, Room Robin. The Epidemiology of Alcohol 
Consumption. Alcohol Health & Research World 1992, 16:3:183-190.
    \2\ Grant BF, Harford TC, Dawson DA, Chou P, Dufour M, Pickering 
RS. Prevalence of DSM-IV Alcohol Abuse and Dependence--United States, 
1992 Alcohol, Health & Research World 1991, 183:243-248.
---------------------------------------------------------------------------
    The health problems caused by alcohol use include damage to the 
brain, liver, gastrointestinal tract, and heart. The relative risk for 
many alcohol-related illnesses rises along with the quantity of alcohol 
consumed daily \3\. Other consequences of alcohol use include crashes 
and other injuries, domestic violence, neglect of work and family, and 
costs to society associated with police, courts, jails, and 
unemployment. Altogether, the consequences of alcohol abuse and 
dependence are estimated to cost the nation $100 billion \4\ and 
100,000 deaths a year \5\.
---------------------------------------------------------------------------
    \3\ Boffeta P, Garfinkel L. Alcohol Drinking and Mortality among 
Men Enrolled in an American Cancer Society Prospective Study. 
Epidemiology 1990, 1:5:342-348.
    \4\ Rice DP. Ninth Special Report to the U.S. Congress on Alcohol 
and Health. DHHS, PHS, 1997 pg 388.
    \5\ National Institute on Alcohol Abuse and Alcoholism. Eighth 
Special Report to the U.S. Congress on Alcohol and Health. NIH Pub. No. 
94-3699. Bethesda, MD: National Institutes of Health, 1993.
---------------------------------------------------------------------------
                          promise of research
    NIAAA's research is guided by one fundamental purpose-to develop 
the necessary knowledge to effectively prevent and treat alcohol abuse 
and alcoholism and their related consequences. Through its nurturing of 
the Nation's alcohol research agenda, NIAAA makes an implicit promise-
that science will yield practical applications that will help those who 
suffer as a result of alcohol abuse and alcoholism. In support of this 
mission, NIAAA conducts and supports a broad-based program of 
biomedical and behavioral research in areas such as the epidemiology of 
alcohol use, abuse, and dependence; alcohol's effects on the brain; the 
genetics of alcoholism, alcohol toxicology; the benefits to health of 
moderate drinking; the effects of public policies on preventing alcohol 
use disorders, and clinical trials to develop or evaluate alcoholism 
treatment therapies.
    The activities of the NIAAA are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
                  pathway from research to application
    While the promise of research is that science will yield practical 
applications, some areas of investigation will require a longer time to 
fulfill the promise than others. For example, the knowledge gained from 
clinical trials is almost immediately available for application to 
alcoholism treatment programs whereas complex basic studies 
investigating alcohol's effects on the brain and the relationship of 
these effects to behavior, will take longer to develop information that 
can be used to design new medications. Chart 2 shows the relative time 
frames in which various areas of research may be expected to yield 
practical applications and will serve as the basis for my further 
remarks.
Clinical Trials
    NIAAA-supports clinical trials designed to develop new and evaluate 
existing treatments. Such trials led to the Food and Drug 
Administration's approval of the medication naltrexone as an adjunct to 
traditional treatment. A product of neuroscience research, naltrexone 
is the first medication since 1949 to be approved to help maintain 
sobriety after detoxification from alcohol. NIAAA currently is 
conducting clinical trials to determine which groups of patients are 
most responsive to naltrexone and the benefits and side effects of 
long-term use. Based on evidence that naltrexone, used in combination 
with verbal therapy, can prevent relapse more than standard verbal 
therapy alone, NIAAA is supporting clinical trials to evaluate the 
effectiveness of combined behavioral/naltrexone therapy to 
substantially reduce the current 50 percent relapse rate among those 
treated for alcoholism.
    Two potential medications on the horizon are acamprosate and 
amperozide. Acamprosate has been clinically tested and used 
successfully for relapse prevention in Europe. After extensive 
consultations with the NIAAA, the pharmaceutical industry has launched 
clinical trials of acamprosate in the U.S. Because of its hypothesized 
mode of action, Amperozide, which has been shown to successfully reduce 
alcohol consumption by primates, is expected to be effective in 
treating human alcoholism. NIAAA also plans to test amperozide in 
collaboration with the Veterans Administration.
    Two recent clinical studies demonstrate that it may be possible to 
intervene inexpensively with heavy drinkers before they progress to 
alcoholism. In the first randomized trial of this kind, investigators 
provided direct evidence that brief physician intervention with problem 
drinkers can decrease alcohol use and health resource utilization. 
These studies are important because detecting alcohol abuse at an early 
stage of development and prior to the onset of alcoholism has both 
practical and medical benefits.
Neuroscience
    The complex mental processes that govern drinking behavior are 
carried out in the brain by many independent interactions among neural 
systems comprised of neurotransmitters and their receptors. Two main 
processes involved in drinking are being studied: positive 
reinforcement, or the pleasurable feedback an individual receives from 
alcohol use; and negative reinforcement, the discomfort associated with 
being deprived of alcohol. In positive reinforcement, alcohol appears 
to interact with the brain's ``pleasure'' or reward system to stimulate 
continued use. Negative reinforcement, which appears to involve 
separate neural systems, may result from the brain's chronic exposure 
to alcohol. Such exposure causes the brain's cells, or neurons, to 
adapt to the presence of alcohol and to ``miss it when it is not 
present.'' Clarification of these processes will enable scientists to 
develop specifically designed medications tailored to individual 
physiology. The study of the mechanisms of action of the two 
medications currently used to prevent relapse--naltrexone and 
acamprosate--is informing this effort. These two drugs appear to work 
through different mechanisms to achieve the same effect; naltrexone by 
blocking positive reinforcement and acamprosate by acting on negative 
reinforcement.
    Alcohol scientists are using advanced neuroscience techniques 
(e.g., patch clamping, imaging, electrophysiology, neurochemistry, and 
cognitive neuroscience) to understand the fundamental phenomena 
associated with alcoholism, i.e., physical dependence, tolerance, 
impaired control over drinking, and the craving for alcohol. However, 
investigating the specific effects of alcohol is challenging; alcohol 
interacts with and alters the activities of many different brain cell 
components and, consequently, may have diverse and profound effects on 
nerve cell function. For example, alcohol can affect various 
neuroreceptors causing the neuron to react by increasing or decreasing 
its usual functions. These receptors are divided into subunits. The 
different ways in which subunits combine affects the brain's 
sensitivity to alcohol, and quite possibly, the sensitivity to alcohol 
among different individuals. How an individual's pattern of subunits 
affects his or her initial sensitivity to alcohol and how alcohol 
influences the way in which subunits combine to affect sensitivity are 
both under study. Transgenic animals have been bred with different 
brain receptor compositions to determine which constitute those that 
are most vulnerable to alcohol. As we learn which subunit variations 
account for addiction, we will be able to develop new medications 
designed to interfere in the addictive process by acting on specific 
brain chemicals.
New Approaches to Medications Development
    Medications have been traditionally developed either by lucky 
accident, or by finding new uses for established medicines. We are now 
moving into a new era in which our understanding of the shape and 
structure of important molecules in the body is dramatically improved 
with techniques such as crystallography and nuclear magnetic imaging. 
With the help of computers and powerful methods of combinatorial 
chemistry to create hundreds of new potential compounds rapidly, it 
will become increasingly possible to design new medications 
specifically to fit known biological structures and alter their 
function. The crystal structure of the alcohol metabolizing enzyme, 
aldehyde dehydrogenase seen in Chart 3, was reported by NIAAA grantees 
this year. It is a fine example of how new insight into structure 
explains function, and is a prototype of what future medication 
development will exploit.
Genetics
    There is ample evidence that a significant portion of the 
susceptibility to alcoholism is inherited. Genetics researchers are now 
actively engaged in identifying the genes that confer this 
vulnerability and developing ways to apply this information to clinical 
populations. The task is difficult because alcoholism is likely to be 
polygenic, with each gene contributing only a portion of the 
vulnerability. The search for the relevant genes is now actively 
pursued in several settings.
    Through the Cooperative Study on the Genetics of Alcoholism (COGA), 
a multisite study at six centers, hundreds of probands and families 
have been interviewed, a complex computerized pedigree database has 
been incorporated, and statistical genetics and molecular biology 
techniques are being applied to ``informative'' families. Phenotypic 
markers shown previously to be relevant to alcohol are incorporated in 
the study, including biochemical markers, evoked potential responses, 
and tests of initial sensitivity to alcohol (the latter being a strong 
predictor of later alcoholism). COGA scientists have recently located 
chromosomal ``hot spots,'' areas of potential linkage of alcohol 
dependence, on chromosomes 1, 7, 8, and 16. Also, the possibility of 
protective factors is suggested by possible linkage on chromosomes 4 
for resilience to alcoholism. In addition, locations for the genes 
involved in the expression of evoked potential responses, a high-risk 
marker for alcoholism, have been tentatively identified. Because 
replication of genetic findings in independent populations is essential 
for their verification, NIAAA has funded two new genetic linkage 
studies. Although smaller in scale than COGA, the relative genetic, 
cultural, and phenotypic homogeneity of these studies' subject samples 
should enhance their likelihood of success.
    Once we know which proteins are coded by the genes for alcoholism, 
alcohol researchers will be able to study the effect of various 
combinations of neurochemicals on these proteins and design medications 
that are targeted specifically to interrupt those processes which 
result in the development of alcoholism.
                          where are we going?
    Research has diversified and consolidated our knowledge of alcohol 
problems. We will continue this progress into the new millennium by 
focusing on research to determine which aspects of the vulnerability to 
alcoholism are inherited; how genetic and non-genetic factors interact 
in the development of alcoholism; how biology and behavior interact in 
the development of alcohol use disorders; and by developing and testing 
new prevention and treatment and methods to reduce the risk for 
alcoholism, improve the chance for recovery and reduce the risk of 
relapse. NIAAA also will continue to pursue research aimed at 
preventing fetal alcohol syndrome, reducing drunk driving; 
understanding the effects of alcohol advertising on our nation's youth; 
improving adolescent alcohol treatment, and clarifying the health 
effects of moderate drinking.
    My colleagues and I will be happy to respond to any questions you 
may have.
                                 ______
                                 
                Prepared Statement of Patricia A. Grady
    Mr. Chairman and Members of the Committee: The President in his 
fiscal year 1999 budget has proposed that the National Institute of 
Nursing Research (NINR) receive $62.4 million, an increase of $4.3 
million over the non-AIDS portion of the fiscal year 1998 
appropriation. Including the estimated allocation for AIDS in both 
years, total support proposed for NINR is $68.3 million an increase of 
$4.7 million over the fiscal year 1998 appropriation. Funds for NINR 
efforts in AIDS research are included within the Office of AIDS 
Research budget request.
    Nursing researchers are at the frontiers of science, building the 
foundation of knowledge for the nation's 2.5 million registered nurses, 
the largest health profession in our Nation, and for other providers of 
health care. Our research is not disease specific, nor is it dedicated 
to a particular age group or population. What nursing research does is 
ask questions that probe the very core of patients' and families' 
personal encounters with illness or its avoidance, perhaps to a more 
immediate, intense extent than other disciplines of science. We ask, 
for example, whether men and women respond differently to drugs used 
for pain relief. What kinds of information will help people reach a 
decision about genetic testing? What can be done to ease the symptoms 
of terminal illness and to help patients maintain their quality of 
life, dignity, and sense of control at the end of life? We are the 
front-line integrators of the science and insights that come from the 
multidisciplinary teams engaged in clinical and basic medical research. 
In recognition of this approach, we say nurses bring ``Life to Research 
and Research to Life.'' In other words, nurses bring patient issues to 
nursing researchers for study, and nursing researchers return important 
information and answers that are directly applicable to people's lives 
and health care.
                  nursing research makes a difference
    Let me give you some vivid examples of how nursing research makes a 
difference:
  --NINR funded a Spanish Arthritis Self-Management Program that is now 
        being used by the California chapter of the National Arthritis 
        Foundation. The National Arthritis Foundation plans to expand 
        this program nationwide, and they have provided funds to adapt 
        the materials for Chinese patients with arthritis. The 
        investigator is developing similar programs in Spanish for 
        other disorders, such as heart and lung diseases, and is 
        working with a major national HMO to implement these programs.
  --Research funded by the Institute has shown, for the first time, 
        that gender makes a difference in pain relief and that a 
        painkiller that had little, or even no, effect on men provides 
        women greater relief, with fewer side effects. This finding has 
        launched a new awareness of the influence of gender on pain and 
        its alleviation and has important implications for future drug 
        development and therapy.
  --Nurse researchers have developed an assessment scale that can 
        actually predict within several days upon admission which 
        nursing home patients are likely to develop pressure ulcers, a 
        condition that is painful and dangerous. This important finding 
        enables nursing home staff to take early preventive action. The 
        assessment technique has been incorporated into the 
        ``Guidelines on Pressure Ulcers,'' published by the Agency for 
        Health Care Policy and Research, which informs clinical 
        practice.
  --Nursing research has developed a model for early hospital discharge 
        that is successful in reducing the costs of Cesarean 
        deliveries, hysterectomies, and the complications of diabetes 
        in pregnant women. Even more importantly, patient satisfaction 
        with the quality of care has increased and rehospitalizations 
        have been reduced. The investigator is consulting with several 
        HMO's to facilitate adoption of this model into their 
        operations.
    Mr. Chairman, last October this subcommittee held a hearing on 
child health issues and asked a key question--What can be done to 
promote healthy lifestyles during childhood and the turbulent 
adolescent years that will continue throughout adulthood? Nursing 
investigators have found some important answers to this question as a 
result of their research. Let me cite an example that is particularly 
compelling--the Cardiovascular Health in Children (CHIC) project, first 
funded in 1990. Initial findings showed that an educational 
intervention conducted in 21 rural and urban elementary schools in 
North Carolina significantly reduced risk factors for cardiovascular 
disease in preadolescents. The issue then became how healthy habits 
learned through the intervention are sustained. To find out, the 
researchers are conducting a follow-up of these students for four 
additional years. The investigators are also testing the intervention 
in 6th through 8th graders to determine whether interventions at the 
elementary school or middle school levels are more effective. A key 
component of this study is the strong representation of minority 
students in the project--20 percent are African American. The 
investigators are now in discussion with the North Carolina school 
system to introduce the program more broadly. Since North Carolina lies 
in the middle of the Nation's heart disease and stroke belt, the impact 
of this program can be significant. The principal investigator is also 
working with her counterparts in Japan and France to compare 
cholesterol, obesity, and physical activity in children. Parts of her 
intervention will soon be replicated in elementary schools in the 
Kagamahari province of Japan, a rural area three hours from the city of 
Kyoto.
                    a focus on end-of-life research
    Let me highlight a particularly important area of research for the 
Institute that touches all of us--end of life. In 1997, NINR was 
designated by Dr. Varmus as the lead NIH Institute for palliative care 
research. NINR is the logical lead on this because of our broad span of 
research that encompasses people at all ages, from all populations, and 
who die from many different causes. The need for research in this area 
is clear. Advances in biomedical and behavioral research have greatly 
improved the length and quality of our lives. But what about the end 
phase of life? In this case, research and care issues associated with 
the inevitable experience of dying have not kept pace. Everyone wants a 
``good death.'' Although our personal definitions of what this means 
may differ, the ultimate goal must be to make the transition from life 
to death as comfortable as possible, with reduced distress to the 
patient and families, leading to death with dignity.
    Health care professionals are trained to cure disease and to save 
lives, but at life's final phase, the issue becomes one of managing 
symptoms effectively. This is a specialty area of nurses and of 
particular interest to nurse researchers. Last September we cosponsored 
a scientific workshop on treating the symptoms in terminal illness and 
issued a program announcement in collaboration with NCI, NIAID, NIMH 
and OAM to stimulate further research in palliative care to ease pain, 
difficulty with breathing, delirium, weakness, nausea, fatigue, and 
depression. We also seek studies of ethical concerns--for example, 
controversies connected with honoring the dying person's wishes--and 
how to help patients and their families make decisions. We look forward 
to this challenge and to working with our NIH colleagues. We also look 
forward to reporting back to you next year about progress on this 
important health and social concern.
                  recent advances in nursing research
    Let me now turn to three recent research advances that promise to 
affect the way health care is provided. Telehealth technology extends 
nursing resources to remote areas and right into individual homes. We 
can save lives by increasing early detection of disease or disease 
complications; and we can reduce costs by decreasing visits to the 
doctor's office. A case in point is a home monitoring project involving 
lung transplant patients. We already know that most rejection occurs in 
the first year after a transplant. Early detection therefore becomes 
key to survival, and patients can play an active role. By using an 
electronic diary and spirometer monitoring device, patients at home can 
record measurements of pulmonary function, vital signs, and symptoms, 
which are then transmitted once a week to a data center for review by 
health care professionals. The frequency and accuracy of these reports 
enable immediate intervention to prevent organ failure. Our findings 
indicate that patient adherence is at 82 percent. This project 
currently monitors more than 100 lung transplant patients. The 
potential of the spirometer-monitoring device for other pulmonary 
conditions appears promising.
    Another advance is in the area of pain. Nurse researchers have long 
been active in this area. A new discovery challenges current practice 
and has important implications for surgical patients. Typically 
benzodiazepines, such as Valium, are used to sedate patients just prior 
to surgery. Our investigators have found, however, that Valium blocks 
the effectiveness of the morphine that patients receive later on to 
reduce pain during or after surgery. By combining a benzodiazepine 
antidote, in this case flumazenil, with morphine after surgery to 
counteract the effects of the earlier-administered Valium, patients 
experience greater pain relief without adverse side effects. This study 
adds important information to the increasing body of knowledge about 
the mix and timing of pain medications.
    Another finding has implications for expanding the usefulness and 
accuracy of electrocardiograms (ECG's). Traditionally, a 10-electrode 
ECG attached to various points on the body is used to detect heart 
abnormalities, but the device is cumbersome, particularly if continuous 
monitoring is required. Investigators tested a device with only 5 
electrodes to determine if it was as effective as the 10-electrode 
device. Results showed that in patients undergoing coronary 
angioplasty, both devices detected the presence or absence of 
ischemia--a deficiency of blood supply to the heart--in 150 of 151 
patients. The 5-lead device also showed the location of the ischemia in 
the heart muscle in 148 out of 151 patients. The convenience and 
accuracy of the 5-electrode model has potential uses in a variety of 
settings, and it promises much improved flexibility of use. Examples 
are when the patient must be monitored continuously and needs mobility, 
or when an ambulance needs the capability to transmit ECG information 
continuously to the hospital before the patient arrives.
               areas of opportunity for research emphases
    A prominent characteristic of nursing research is its 
interdisciplinary perspective that is free of the boundaries of a 
particular disease, age group or technology. Collaborative efforts 
within NIH are an essential part of NINR activities, and our planned 
research directions for fiscal year 1999 reflect this emphasis. Let me 
describe briefly six of these areas that appear especially promising:
  --Stroke is the number one cause of adult disability. Its symptoms 
        can be discouraging for the patient and difficult to manage for 
        health care providers and family caregivers. NINR will solicit 
        research to identify and test nonpharmacological approaches to 
        the management of stroke, including helping stroke patients 
        learn to care for themselves and helping family members 
        strengthen their own caregiving skills.
  --We often take breathing for granted until disease, surgery, or 
        other events interfere to make us uncomfortably, sometimes 
        fearfully, aware of our need for the next breath. Mechanical 
        ventilation provides relief, but the downside is the dangerous 
        risk of inflammation, infection, and dependence on the machine. 
        NINR plans a program announcement for multidisciplinary studies 
        to address long-term ventilation issues, including quality of 
        life, and ethical and cost considerations.
  --As discussed in the subcommittee's hearings last November on the 
        role of the mind in healing and health, the relationship 
        between behavior and the immune system, known as 
        neuroimmunomodulation, is an important but nebulous area in 
        need of clarifying research. NINR will solicit proposals to 
        examine the impact of behavioral interventions on physical 
        status and how altered immune function affects people's 
        psychological state and willingness to change behaviors.
  --Although the U.S. infant mortality rate has decreased, the rate of 
        low birthweight, typically premature births, has slowly 
        increased. These babies are at risk for a multitude of physical 
        and psychological problems, and account for a significant 
        proportion of the annual health care expenditures for children. 
        The National Center for Health Care Statistics reports that 
        African Americans are over two times more likely to have poor 
        pregnancy outcomes than whites, yet studies show economic and 
        social conditions are not the cause. The challenge then becomes 
        one of understanding the reasons for ethnic variations. An NINR 
        initiative will focus on these and other issues that can inform 
        prevention strategies for low birthweight in populations at 
        risk. Since many health problems of adulthood have their roots 
        in unhealthy behaviors in childhood and adolescence, the NINR 
        plans to expand its prevention research in this area. 
        Interventions at a younger age appear particularly critical. 
        NINR will issue a program announcement to stimulate research 
        that will reduce or prevent risky behaviors in young people, 
        such as smoking, drug and alcohol abuse, and poor eating 
        habits.
  --Resurgence and emergence of infectious diseases and bacterial 
        resistance to antibiotics is a worldwide issue. In addition to 
        increased surveillance, new antibiotics and research into the 
        immune system, NINR will encourage research to understand 
        better the effects of behavioral influences on adherence to 
        medical treatment, diet, personal hygiene, and sexual behavior.
    In conclusion, I would like to stress that as we arrive at the 21st 
century, it is clear that health research, health care, and health 
choices are increasingly interdependent, and that nursing research will 
play a vital role in all three areas. A prominent private sector health 
care official, has said that the next decade will be the decade of the 
nurse. I agree. Scientifically validated methodologies, communication 
strategies, and effective interventions--coupled with a basic 
understanding of human nature and our Nation's diverse populations, 
will make a positive difference to the health and quality of life of 
the American people.
     Mr. Chairman, I will be pleased to answer any questions you might 
have.
                                 ______
                                 
                Prepared Statement of Francis S. Collins
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the National Human Genome Research 
Institute (NHGRI) for fiscal year 1999, a sum of $236,996,000, an 
increase of 10.4 percent over the fiscal year 1998 comparable 
appropriation. Including the estimated allocation for AIDS, total 
support proposed for NHGRI is $240,134,000. Funds for the NHGRI efforts 
in AIDS research are included in the Office of AIDS Research budget 
request.
                             gene discovery
    This is my fifth opportunity to appear before this Committee. As 
Director of NHGRI, I am proud of its leadership in the U.S. Human 
Genome Project and its cutting-edge research program on the genetic 
analysis of disease. Now at the half-way mark, progress in the 15-year 
Human Genome Project, its impact on health research and even public 
policy has surpassed the most ambitious expectations.
    With Human Genome Project tools, it is possible to track down a 
disease-related gene even when nothing is known about the biochemical 
problems of the disease or how the gene works. This technique, based on 
identifying the position of a gene in the chromosome and then isolating 
it, was successfully used for the first time in 1986. Now, the 
increasing detail and quality of genome maps have reduced the time it 
takes to find a disease gene from years, to months, to weeks, to 
sometimes just days, and scientists are using the tools to discover 
dozens of disease genes each year. Increasingly, gene hunters are 
combining positional cloning techniques with a new ``gene map'' to make 
gene finding even easier and quicker. Constructed largely by scientists 
at NHGRI-supported research centers and the National Library of 
Medicine, the map has doubled in its detail since the first version was 
released two years ago. It now contains 30,011 gene tags, which may 
represent nearly half of all human genes. Disease-gene hunters now have 
about a 50 percent chance they will find an already characterized gene 
waiting for them in the chromosomal neighborhood they know is involved 
in a disease.
    The isolation of a gene for Parkinson's disease (PD) last year 
demonstrated the power of this new discovery method and showed 
conclusively that changes in DNA can cause PD in some families. Only 
two years ago, the National Institute of Neurological Disorders and 
Stroke held a workshop to explore using genetic approaches to 
understand PD. A team led by scientists in NHGRI's Division of 
Intramural Research (DIR) began large-scale genetic analysis of DNA 
from members of a large Italian family containing almost 600 people, 
more than 60 of whom have been diagnosed with Parkinson's. In nine 
days, NHGRI gene hunters mapped the gene to a region of chromosome 4, 
which contained approximately 100 genes. One of the genes in that 
interval had already been identified on the gene map and was known to 
encode a protein called alpha-synuclein. That gene was an excellent 
candidate for a Parkinson's disease gene because earlier research had 
already shown the protein builds up in brain cells of people with 
Alzheimer's disease, and people with PD have similar deposits. In just 
a few months, the researchers showed conclusively that an altered 
alpha-synuclein gene caused Parkinson's in the study families. Many 
have hailed this as the most significant advance in Parkinson's disease 
research in 30 years. Just ten days ago, a German research team used 
genome mapping tools to identify a new region on chromosome 2 that also 
appears to contain a gene that predisposes to Parkinson's. Some of the 
genes already known to exist in that region are providing excellent 
candidates for identification of the actual gene.
    At NHGRI, intramural scientists and their colleagues have made 
tremendous progress this year in identifying the genetic components of 
some common cancers. These include identification of an altered gene 
that can cause multiple benign endocrine tumors and a type of 
pancreatic cancer--a syndrome called multiple endocrine neoplasia type 
1 (MEN1), and a gene, called AIB1, linked to the growth and progression 
of breast cancer. DIR scientists and their collaborators this past year 
isolated a gene underlying the neurological disorder Niemann-Pick Type 
C (NPC), and other genes involved in rare diseases that shed light on 
normal cell function. A newly discovered gene called JAG1, for example, 
was shown to cause the rare childhood disease Alagille syndrome. JAG1 
has already been studied in the fruit fly and may help explain how 
incorrect cell signals during development can result in a wide range of 
birth defects.
                     human genome project progress
    The ultimate goal of the international Human Genome Project is to 
spell out, letter by letter, all 3 billion bases in the human genome by 
the year 2005. Since the start of the Human Genome Project, scientists 
have been experimenting with whole-genome sequencing methods on 
smaller, less complex micro-organisms. This past year, for example, 
NHGRI-supported scientists at the University of Wisconsin-Madison 
published the full DNA sequence of the bacterium E. coli--probably the 
most studied simple organism in all of science and the foundation of 
the biotechnology industry. Researchers now have access to the 
organism's genetics in their entirety--all 4,403 genes nestled among 
4,639,221 base pairs of DNA, which gives them a powerful new tool to 
observe complete cellular systems, including metabolism, the regulation 
of gene activity, substance transport, and cell division.
    NHGRI began pilot projects in 1996 to test strategies and 
technologies for full-scale sequencing of the human genome, which 
contains about 1,000 times more DNA than E. coli does. Already, 
investigators have deposited almost 40 million bases of high-quality 
human DNA sequence in GenBank. NHGRI grantees expect to produce 60 
percent or more of the total human DNA sequence (1.8 billion base 
pairs), with the remainder to be contributed by other Human Genome 
Project partners in the United States and abroad. To complete its 
portion, NHGRI recently announced a $70 million initiative to establish 
a coordinated network of laboratories. Those laboratories are expected 
to produce an average of 300-500 million bases of finished, accurate 
human sequence per year by 2003. The sequence produced must have four 
characteristics--the ``4 A's'' of the Human Genome Project--(1) the 
sequence must be accurate, that is, the DNA spellings must be correct. 
The sequencing network will include quality assurance labs to ensure 
accuracy of 99.99 percent or better. (2) Large-scale sequencing relies 
on the accurate assembly of smaller lengths of sequenced DNA into 
longer, genomic-scale pieces, so DNA coming from the NHGRI network will 
be assembled into long pieces that reflect the original genomic DNA. 
(3) Because human DNA sequence must also be affordable, a portion of 
the network will focus on technology development to reduce cost as must 
as possible. (4) Finally, high-quality, finished human DNA sequence 
should be available to the entire research community, so NHGRI has 
introduced policies to make sequence from the network accessible within 
24 hours through public databases.
    The Human Genome Project is unique among most biological research 
efforts in its establishment of specific, goal-oriented research plans. 
The current plan expires in October, 1998, so NHGRI is in the midst of 
establishing a research plan to cover the next five years. The new plan 
will include working toward completing the first full human DNA 
sequence, developing faster sequencing technologies for the future, 
studying sequence variation and its relationship to disease, 
identifying and analyzing the function of genes in the human genome, 
and continued studies of the ethical, legal, and social implications 
(ELSI) of new genetic technologies.
                            complex diseases
    Straightforward rules of inheritance govern disease traits 
resulting from changes in a single gene, and it is now easier and 
faster than ever to track down and isolate such disease genes. But the 
inheritance of most common disorders--diabetes, heart disease, and most 
common cancers, which result from the interplay of environment, 
lifestyle, and small effects of many genes--is much more complex and 
requires even more powerful tools.
    NHGRI has just launched a new initiative to help speed the 
breakthroughs in complex disease research--a major new goal for the 
Human Genome Project. Most complex diseases result from the combined 
effects of several relatively weak genetic contributions, and finding 
disease genes that have such weak effects has been painstakingly 
difficult. The search for such genes would be aided enormously by a 
thorough cataloging of the different versions of a whole list of 
genetic sites that occur in the human population. With such a catalog, 
scientists could begin to define which genetic differences are 
associated with a propensity for a specific disease and could help 
explain why, although we all carry the same genes, some individuals, 
families, and even ethnic groups appear to be more likely than others 
to develop certain diseases. To facilitate these studies, NHGRI is 
leading an NIH-wide effort along with 17 other Institutes to develop a 
very high-density map of slight-but-telling differences in the DNA code 
called ``snips'' (for single nucleotide polymorphisms or SNP's).
    Another NHGRI initiative is contributing to the analysis of complex 
disease. The Center for Inherited Disease Research (CIDR), located on 
the Bayview campus of Johns Hopkins University, provides high-
throughput genotyping services, study design advice, and sophisticated 
database assistance to research teams attempting to identify genetic 
locations and variations involved in complex diseases. A joint effort 
by eight NIH institutes, with the NHGRI serving as the lead, CIDR has 
just completed its first genotyping project for genomic changes 
associated with manic-depressive disorder. A second project, a study of 
deafness, has begun.
    NHGRI is also involved in whole-genome studies to identify 
mutations that lead to adult onset diabetes mellitus and prostate 
cancer to understand and help remedy the disproportionately high rates 
of those diseases among African-Americans. These studies are supported 
by the NIH Office of Research on Minority Health and organized by an 
NHGRI-Howard University collaborative center for studying diseases that 
disproportionately affect minority individuals.
                         technology development
    Studies of genetic variation in large populations, complex 
diseases, and the simultaneous activity of multiple genes will rely on 
development of new technologies for large-scale genomic analysis. Such 
studies are already successfully using the marriage of semiconductors 
and DNA in so-called DNA chips. One version, which originated from an 
NHGRI grant to a scientist at a small California company, was recently 
featured on the cover of Fortune Magazine and in this year's State of 
Union address. That chip consists of a thin slice of silicon about the 
size of a postage stamp upon which threads of DNA, whose spellings are 
already known, are arrayed. Such DNA chips can be used for a broad 
range of studies, including identifying DNA changes that lead to 
disease. This would be particularly useful, along with family histories 
and data from large population studies, for establishing an 
individual's risk of developing common but hard-to-treat disorders like 
cancer, heart disease, diabetes, or psychiatric disorders, where 
multiple genetic alterations contribute, but each on a small scale. A 
baseline genome scan could give patients and health care providers 
helpful information about an individual's disease risk profile and 
point to which prevention strategies--when available--should be put 
into place. Eventually, the chips may even be used to identify which 
patients are genetically most likely to respond to specific therapies. 
Diseases may be subclassified by their underlying genetic configuration 
rather than by physical symptoms. Administering drugs targeted only to 
that particular genetic subtype could maximize efficiency, minimize 
side effects, and reduce treatment time wasted on ineffective 
therapies. The pharmaceutical industry is eagerly awaiting advances in 
DNA chip technology, and a catalog of human DNA variations, to 
incorporate into their research and development programs for improved 
treatment strategies.
             ethical, legal, and social implications [elsi]
    These dramatic new abilities to read large amounts of genetic 
information have important implications for the privacy and fair use of 
that information. The Human Genome Project is unique among research 
programs in its commitment to address the ethical, legal, and social 
implications of its technologies side-by-side with the scientific 
agenda. NHGRI's ELSI research and policy development programs have 
spearheaded policy movement on a number of complex issues by supporting 
rigorous scholarly research and through development of options for 
state and federal policy makers.
    One of the most active ELSI areas has been policy development 
related to the privacy and fair use of genetic information, 
particularly in health insurance, employment, and medical research. 
This past year, President Clinton announced his support for a 
comprehensive legislative solution to the problem of genetic 
discrimination in health insurance, based on recommendations the ELSI 
Working Group and the National Action Plan on Breast Cancer (NAPBC) 
developed in a workshop three years ago. Protection gaps in The Health 
Insurance Portability and Accountability Act, which took a significant 
step toward preventing genetic discrimination in health insurance, can 
now be closed by legislation that would expand those protections to the 
individual insurance market. In January, Vice President Gore announced 
Administration support for federal legislation to prohibit genetic 
discrimination in the workplace. Again, the Administration's 
recommendations are based on the recommendations of the NAPBC-ELSI 
Working Group, which held a workshop two years ago to address the use 
of genetic information in employer-provided insurance, in 
discrimination in hiring and promotions, and privacy of that 
information. NHGRI staff worked closely with staff from the Office of 
the Secretary of Health and Human Services, the Department of Labor, 
and the Department of Justice to present these options to the White 
House. NHGRI and NAPBC recently met for a third time to address 
problems related to protecting the privacy of genetic information in 
the medical record. Workshop participants identified areas where new or 
modified policies or practices might enhance privacy protections 
without discouraging crucial areas of research. The group is developing 
a set of principles for researchers, research institutions, state and 
federal agencies, and policy makers to consider in formulating privacy 
protections for research information.
    Other significant steps have been taken to ensure the responsible 
integration of genetic tests into clinical practice. The Task Force on 
Genetic Testing recently concluded its two-year analysis of genetic 
testing in the United States and published a report that contains 
recommendations for federal agencies, testing laboratories, and health 
professionals. The Cancer Genetics Studies Consortium, supported by 
NHGRI and several other NIH Institutes, has published in medical 
journals their recommendations for follow-up care of individuals with 
specific cancer-causing gene mutations. Another product from the group 
describes informed consent for genetic testing for susceptibility to 
adult-onset cancer.
    Recognizing the rapid pace of human genetics research and its 
impact on an increasing number of medical disciplines, the American 
Medical Association and the American Nurses Association, in 
collaboration with NHGRI staff, founded the National Coalition for 
Health Professional Education in Genetics. The Coalition's mission is 
to ensure that our nation's health care providers have the knowledge, 
skills and resources to integrate responsibly new genetic knowledge 
into health care. Approximately 100 organizations representing health 
care professionals, consumer groups, industry, genetics professional 
organizations, and government agencies participated in the Coalition's 
first meeting this past year. The new National Foundation for 
Biomedical Research, a government-created foundation ``dedicated to 
creating public-private partnerships to promote the mission of the 
National Institutes of Health,'' is considering serving as the 
Coalition's administrative manager.
    As the Human Genome Project approaches the half-way mark, the 
contributions it has made to understanding human diseases have been 
gratifying and remarkable. In the years ahead, the full DNA sequence of 
the human will give us unprecedented opportunities to observe and 
understand the literal thread of life. There is now no question that 
genome maps, sequence, and analytical tools will provide a robust 
technological infrastructure for biomedical research well into the next 
century.
    The activities of the NHGRI are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan. My colleagues and I will be happy to 
respond to any questions you may have.
                                 ______
                                 
              Prepared Statement of Judith L. Vaitukaitis
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget for the National Center for Research Resources 
(NCRR) for fiscal year 1999, a sum of $423 million, an increase of 
$51.5 million (or 13.9 percent) above the comparable fiscal year 1998 
non-AIDS appropriation. Including the estimated allocation for AIDS in 
both years, total support proposed for NCRR is $514.8 million, an 
increase of $60.9 million over the fiscal year 1998 appropriation.
    It is a pleasure once again to have the opportunity to discuss the 
accomplishments and future directions of the NCRR, which fills a unique 
and indispensable niche in the family of NIH institutes and centers. 
Unlike the other components of NIH, which focus on particular 
biomedical disciplines, diseases, or organ systems, NCRR provides the 
essential tools and infrastructure that facilitate all lines of NIH-
supported research, ranging from basic to clinical investigations. NCRR 
can best be described as a catalyst for discovery, for without advanced 
instrumentation, up-to-date research facilities with access to 
specialized expertise, and animal models for human diseases, the 
scientific enterprise would be slowed and more costly. Each year more 
than 15,000 investigators, supported by more than $1.8 billion from the 
NIH categorical institutes, utilize NCRR-supported research resource 
facilities as integral parts of their research. Shared instrumentation 
grants and repositories for both biomaterials and animal models are 
also invaluable resources to thousands of additional extramural 
investigators. Our fundamental objectives are to direct NCRR's support 
to maximize sharing of research resources and technologies, enhancing 
multidisciplinary research by fostering collaborations among 
investigators, and leveraging federal funds.
                 advanced instrumentation and computers
    Advanced instrumentation and computers have a fundamental role in 
most biomedical studies, yet they also account for some of the largest 
expenses. To help reduce costs while providing access to the most 
sophisticated research tools, NCRR supports shared instruments and 
resources, including a network of more than 60 biomedical technology 
resource centers that develop and provide access to critical 
technologies for health research, ranging from those for degenerative 
brain disorders, cancer, cardiovascular diseases to AIDS.
    Shared resources are essential tools in efforts to unravel the 
complexities of the human genome as well as to define the genetic 
defects that lead to diseases such as sickle cell anemia, cystic 
fibrosis and a variety of cancers. This enormous undertaking requires 
an array of sophisticated and costly instruments such as sequencers, 
mass spectrometers, analytical ultracentrifuges, and nuclear magnetic 
resonance imagers. By awarding grants for these instruments as shared 
resources, their utilization is greatly increased. On average, more 
than 15 investigators share each instrument provided through NCRR's 
Shared Instrumentation Grant program. In fiscal year 1999, NCRR will 
significantly expand this unique program to assure that investigators 
have state-of-the-art research tools.
    In recent years it has become increasingly clear that a complete 
picture of the genome can only be obtained if gene identification 
efforts are supplemented with studies to characterize the proteins 
produced by the genes. At an NCRR-supported microscopy and imaging 
resource at the University of California, San Diego, scientists are 
developing microscopic methods that permit mapping of both genes and 
their products in situ for Alzheimer's Disease, for example. Resource 
facilities like this and others will accommodate investigator access 
and permit remote control of sophisticated instruments over the 
Internet and facilitate electronic communication with colleagues at 
other sites. Such arrangements will permit interactive tasks as if the 
collaborators are in the same laboratory. Continuing developments in 
computer technology and establishment of the ultrafast Internet-2 will 
allow extensive scientific collaboration and sharing of research 
resources and technologies. In fiscal year 1999, NCRR plans to expand 
these initial efforts, so in a few years cooperating university 
Internet sites will provide gateways to access sophisticated 
technologies, investigators and databases across the research 
community.
    X-ray crystallography provides the ultimate details of molecular 
structures. The ultrabright synchrotron-generated X-rays have made it 
possible to increase resolution to levels that were not believed 
possible just a few years ago. For example, NCRR-supported scientists 
at Stanford University recently determined the detailed structure of 
the protein fibrinogen, which is essential to stop bleeding but also 
contributes to heart disease and stroke. As the human genome project 
identifies more genes, more proteins of unknown structure and function 
will require characterization in order to define the causes of disease 
and to develop novel therapies for them. In fiscal year 1999, NCRR 
plans to increase its support for investigator access to synchrotron 
beamlines.
    As research problems become more complex, their solutions require 
more sophisticated technologies that demand an integrated approach. For 
example, the attached Figure summarizes the interaction of several 
costly, advanced technologies that contribute significantly to the 
development of novel drug therapies. This approach is commonly referred 
to as structure-based drug design. Either high energy x-rays, high 
field nuclear magnetic resonance or both technologies provide essential 
data about the structure of a purified protein. In the Figure before 
you, high energy x-rays, generated at the Advanced Photon Source at the 
Argonne National Laboratory, provide a key tool to analyze a 
crystallized protein. However, that crystallographic data may not be 
enough. That same protein may also need to be studied by high field 
nuclear magnetic resonance at an NCRR-supported research resource 
facility such as the Massachusetts Institute of Technology's Center for 
Magnetic Resonance to gain additional information to discern the 
protein's molecular structure. Data from synchrotrons or NMR's can be 
analyzed by a special software designed to run on a supercomputer, 
which may be located at the University of Pittsburgh. That processed 
information may then be moved over the Internet and analyzed by 3D 
Visualization tools, using the investigator's own workstation. The 
image in the center of the Figure was created with a molecular graphics 
system at the NCRR-supported University of California at San 
Francisco's Computer Graphics Laboratory. Visualization tools help 
identify the site on the molecule at which a drug may interact. 
Candidate drugs and proteins which may bind at the active site can be 
selected from databases over the Internet at sites somewhere in the 
U.S. or Europe. The molecule displayed is HIV-1 protease (shown in 
green and yellow) along with a drug candidate (depicted in magenta) 
bound within the enzyme's active site. The drug inhibits or blocks the 
biologic action of the protease and is a potential new treatment for 
HIV infection in man. The structure of HIV-1 protease was solved by 
members of the Crystallography Laboratory of the National Cancer 
Institute. Structure-based drug design is a faster and more cost 
effective approach to drug development than the empirical approaches 
used in the past.
    Other recent developments in areas related to genomic research will 
generate major new multidisciplinary initiatives. Areas such as laser 
light source technology and design of extremely small-scale tools using 
nanofabrication and nanobioengineering techniques are now so advanced 
that engineers and scientists are constructing devices for detection of 
single molecules and miniaturizing instruments that will save expensive 
reagents and man hours. For example, the development of microchips for 
ultrasensitive DNA analysis is a revolutionary approach to 
miniaturization. Manufacture of these chips requires multidisciplinary 
expertise in production of computer chips, molecular biology, optics, 
and gene sequencing that will bring together physicists, engineers, and 
biologists. NCRR plans to extend its support to provide these powerful 
tools to identify genetic risk factors which may be modulated by diet, 
changes in lifestyles or other approaches to prevent, delay or treat 
disease.
                       biology of brain disorders
    Thanks to powerful new technologies such as functional magnetic 
resonance imaging, or fMRI, and multiphoton laser scanning microscopy, 
scientists have gained increasingly detailed insight into the biology 
of the human brain. NCRR-supported researchers at Carnegie Mellon 
University, University of Pittsburgh Medical Center, and Pittsburgh 
Supercomputing Center have combined the powers of fMRI, high-speed 
networks, and a supercomputer to produce high-quality 3-D images of the 
working brain within seconds of recording. To capitalize on these 
technological enhancements, NCRR will support development and 
acquisition of instruments that provide images of the brain, including 
images of tissue damaged by neurodegenerative diseases such as 
Parkinson's or Alzheimer's, in even more detail than currently 
possible. In addition, NCRR will support development of user-friendly 
database structures to facilitate investigator analysis and synthesis 
of vast data sets.
                            genetic medicine
    Nonhuman biological and disease models are indispensable to 
biomedical research. To understand gene function in cancer, diabetes 
and cardiovascular diseases, for example, scientists have developed 
thousands of genetically altered animal models in mice and rats. To 
assure preservation of these models, which are expensive to maintain, 
NCRR will create additional national and regional repositories to 
assure that novel genetically altered mice and rats can be distributed 
to investigators nationwide.
    Certain studies with great implications for human health can best 
be carried out in nonhuman primates. Examples include development of a 
vaccine against AIDS and in-depth understanding of the immune system. 
Scientists at NCRR-supported Regional Primate Research Centers have 
developed procedures for producing genetically identical monkeys. 
Availability of these animals will facilitate development of an AIDS 
vaccine and provide a unique model to more effectively study tissue 
rejection associated with organ transplantation. NCRR plans to further 
develop this model.
    Gene therapy is still at an early stage but holds great promise. 
NCRR, in collaboration with the National Cancer Institute, the National 
Heart, Lung, and Blood Institute and the National Institute of 
Diabetes, Digestive and Kidney Diseases, supported the establishment 
and maintenance of three National Gene Vector Laboratories that produce 
clinical-grade gene vectors, or carriers. These gene carriers are used 
in human gene therapy to transport therapeutic genes into cells where 
they are needed to alleviate or cure diseases such as cystic fibrosis, 
atherosclerosis, and an array of cancers. But the technique still needs 
refinement, and additional vectors need to be developed and studied. 
Because the safety of new vectors must be extensively examined, NCRR 
plans to support the development of additional vectors as well as their 
preclinical evaluations at NCRR-supported research resource facilities.
                           research capacity
    NCRR administers an NIH-wide extramural construction grant program 
that requires matching institutional funding. The awards support 
renovation or new construction of research facilities at medical 
schools, hospitals, universities, and research institutions. According 
to a 1996 survey conducted by the National Science Foundation (The 
Status of Biomedical Facilities), academic institutions had deferred 
$3.6 billion worth of needed biomedical construction and repair or 
renovation projects. To help alleviate this need, NCRR plans to 
continue funding of construction projects to upgrade biomedical 
research facilities.
    General Clinical Research Centers (GCRC's) play a key role in 
patient-oriented research and that research reflects that supported by 
the NIH categoric Institutes. The GCRC's host nearly 9,000 
investigators who conduct nearly 6,000 research projects annually. The 
GCRC's provide infrastructure to academic institutions through the 
support of inpatient and outpatient research facilities and other 
resources vital for state-of-the-art, patient-oriented research. The 
GCRC's also provide an effective forum for training and junior career 
development for mentored, patient-oriented, clinical research. The 
GCRC's need to expand research activities into less traditional GCRC 
research areas, such as intensive care, emergency rooms, trauma units, 
and other specialized units. Seriously ill patients are increasingly 
studied at GCRC's, and the need for specialized testing and research 
nurse staffing to support those research studies has increased 
markedly. To address this need, NCRR in fiscal year 1999 will enhance 
support for the network of GCRC's which provide a critical interface to 
assure that scientific advances for rare diseases, cancers, diabetes 
mellitus, AIDS, cardiovascular and many other diseases are transferred 
from the laboratory to the patient.
    To enhance research on diseases such as renal disease, diabetes 
mellitus, and cancer, that disproportionately affect minority 
populations, NCRR will support establishment of Centers of Clinical 
Research Excellence at NCRR-supported Research Centers in Minority 
Institutions that are affiliated with medical schools. The centers will 
recruit new faculty, established investigators in clinical research, 
who will serve as mentors to junior investigators in an effort to build 
effective clinical research teams.
    The activities of the NCRR are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    My colleagues and I will be happy to respond to any questions you 
may have.
                                 ______
                                 
                Prepared Statement of Philip E. Schambra
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's non-AIDS budget request for the Fogarty International 
Center for fiscal year 1999, a sum of $19.1 million, which reflects an 
increase of $1.4 million over the fiscal year 1998 appropriation. 
Including the estimated allocation for AIDS, total support requested 
for the FIC is $30.4 million, an increase of $2.1 million over the 
fiscal year 1998 appropriation. Funds for the FIC efforts in AIDS 
research are included within the Office of AIDS Research budget 
request.
    This year the FIC enters its 30th year as a focus of NIH 
international activities. Our mission is to assist this nation to deal 
with health problems that transcend national boundaries and that can be 
combated most effectively through international cooperation. Through 
training and research support, FIC enables American universities and 
research institutes to cooperate in regions of the world that, due to 
disease burdens, provide unique opportunities to advance international 
health.
                       why international health?
    May I direct your attention to the chart which pictorially displays 
why international health is important. First, to protect Americans 
against global health threats. With frequent international travel, vast 
movements of populations of refugees, and potential changes in our 
climate affecting health, global trends are of increasing importance 
for us all. One has only to consider the emergence and spread of AIDS 
to recognize the necessity of confronting health needs in a global 
context. Moreover, international commerce presents new risks for the 
transfer of infectious agents for both humans and livestock, as well as 
toxic substances such as pesticides and pollutants, and even biologic 
and chemical agents.
    Second, to fulfill a longstanding American humanitarian tradition. 
The Global Burden of Disease Study commissioned by the World Bank 
indicates that developing nations suffer over ninety percent of the 
burden of premature mortality as measured in lost years of life. These 
countries, constituting three-quarters of the world's population, now 
share a triple burden: the persistence of infectious diseases and 
malnutrition responsible for 16 million deaths per year, mainly 
children; a growing incidence of chronic disease and disability due to 
increased life spans and new risk exposures; and environmental and 
occupational health hazards which accompany industrialization.
    Third, to advance America's global interests. The United States is 
at the vanguard of scientific progress and produces more knowledge, 
publications and medical interventions than any country in the world. 
Because of our leadership, we share an opportunity and an obligation to 
influence the international community, international organizations and 
developing and industrialized countries alike to address the health 
problems of those most in need. Further, international cooperation in 
biomedical science not only enables the United States to share skills 
and knowledge, but cultural and societal values intrinsic to scientific 
progress as well.
    This nation's investment in research on global disease prevention 
produces significant economic returns. For example, the Institute of 
Medicine of the National Academy of Sciences reports that the United 
States saves $450 million every year by not having to vaccinate its 
citizens against smallpox. The World Health Organization predicts that 
our efforts to eradicate poliomyelitis will result in global savings of 
$500 million by the end of this decade. However, despite U.S. 
prominence in the creation of new drugs and medical devices as measured 
by percentage of world patents, our global share of exports to a market 
that exceeds $40 billion annually, namely developing nations, is a mere 
15 percent. International cooperation in health is one pathway to 
emerging markets enabling millions of citizens of these countries 
access to more modern drugs.
              how does fic meet these critical challenges?
    Please turn once again to our chart with the overlay which 
describes our major efforts. In the progress of biomedical science, one 
critical limiting factor is human talent. FIC's investment is in human 
capital, with a particular focus on developing nations. Scientific 
partnerships with these nations are of strategic importance. What 
follows describes our efforts to improve America's scientific capacity 
to conduct international research on global priorities identified in 
collaboration with our sister institutes at NIH and the scientific 
community.
    With the support of this committee, the FIC International Training 
and Research Program in Emerging Infectious Diseases was initiated this 
past year to improve our capacity to understand the fundamental biology 
and epidemiology of new or resurgent infectious diseases. Launched in 
collaboration with the National Institute of Allergy and Infectious 
Diseases, the program explores the changing patterns of infectious 
diseases due to microbial evolution, human behavior, and economic 
development and land use.
    The model for this new program is FIC's AIDS International Training 
and Research Program. Under this program, over 1,300 foreign scientists 
from over 80 countries in Africa, Asia, Latin America, and Central and 
Eastern Europe have received long-term HIV research training in the 
United States. Many former trainees are now co-investigators on NIH-
supported research projects in developing countries where HIV/AIDS is 
epidemic. In addition, more than 41,000 physicians, nurses and 
laboratory technicians have gained new skills through in-country 
training courses. The emerging infectious diseases and AIDS programs, 
in tandem, represent investments in training and infrastructure that 
will assist the United States to develop vaccines and other 
interventions for diseases that require international trials. These 
include HIV, tuberculosis (TB), diarrheal and parasitic diseases, and 
acute respiratory infections.
    HIV and other pandemics demonstrate that disease is not demarcated 
by national borders. In some cases, disadvantaged groups in the United 
States exhibit similar health risks with populations in resource-poor 
nations, risks due to micronutrient deficiencies and perinatal 
infections and other conditions. There are lessons to be learned 
domestically from research conducted abroad. For example, studies in 
Tanzania demonstrated that unless treatment regimens are supervised 
closely, TB rapidly becomes resistant to available drugs. That finding 
now has been applied to community health programs in New York City and 
other urban centers.
    Another FIC global priority is to prevent adverse health effects of 
industrial and chemical pollutants. The FIC International Training and 
Research Program in Environmental and Occupational Health enables U.S. 
institutions to train scientists from regions of the world with high 
levels of contaminants in the environment and workplace, such as 
Eastern Europe, Russia and the new republics. The program is co-funded 
with the National Institute of Environmental Health Sciences and CDC's 
National Institute for Occupational Safety and Health, and National 
Center for Environmental Health. Current studies in Ukraine and Belarus 
undertaken after the accident at Chernobyl include the effects of 
radiation on growth and development, incidence of thyroid cancer, and 
reproductive health disorders.
    One of the chief casualties of environmental decay is biologic 
diversity. There is a tendency to assume that our increasing 
technological sophistication moves us further from dependence on the 
natural world. However, it is likely that ecosystems maintained by 
diverse species are part of our protection against diseases. For 
example, deforestation has introduced new infectious agents into human 
populations; the depletion of ozone in the stratosphere erodes 
protection against the damaging effects of ultraviolet radiation.
    The Earth's biota also is a continuing resource for new 
therapeutics. The FIC leads an interagency effort to discover new drugs 
from the earth's biological diversity. The International Cooperative 
Biodiversity Groups Program is funded in partnership with several NIH 
research institutes, the National Science Foundation, and U.S. 
industries. This program represents academic-industry consortia, 
examining genetic resources from terrestrial and marine environments 
worldwide. The program now is in its fifth year, and together these 
groups have examined over 3,000 species for activity in 13 therapeutic 
areas. At this early stage in the drug development process, there are 
approximately 25 high priority leads, including several to treat 
malaria, viral diseases, and cancer. Of equal importance, by 
demonstrating the economic and humanitarian potential of new drugs 
derived from biodiversity, this program has influenced governmental 
efforts to sustain ecological balance in Argentina, Peru, Chile, 
Suriname and Mexico.
    A root source of global health problems is demographic pressure. 
The world's population is now expanding at the unprecedented rate of 
nearly 1 billion per decade. Demographers at the United Nations 
estimate that virtually all of this growth will occur in the developing 
nations of Africa, Asia and Latin America. There is broad consensus 
that more stable population growth will enhance the prospects for 
improved living conditions for billions in the decades ahead. Yet this 
will require new medical technologies and social adaptations generated 
through research. Through our International Training and Research 
Program in Population and Health, FIC increases the capacity to conduct 
research on reproductive and neonatal health care and improves 
demographic capabilities in countries where population growth impedes 
economic development. The program is co-funded with the National 
Institute of Child Health and Human Development. Already, several 
collaborative projects have yielded discoveries. Scientists at the 
University of Virginia and the National Institute of Immunology in New 
Delhi, India have identified a specific antigen on spermatozoa in 
primates that will serve as the basis of a male contraceptive vaccine. 
If ultimately developed, this vaccine would be a major breakthrough in 
the field of contraceptive development.
    Finally, in partnership with the National Library of Medicine, the 
FIC conceived an International Training Program in Medical Informatics 
to increase research capacity and health care through information 
technology. A pilot program with Africa will be initiated in fiscal 
year 1998. The fundamental goal is to develop collaborative teams of 
U.S. and African researchers and information specialists who apply 
state-of-the-art telecommunications and computer technologies to 
challenges in biomedical science and medical care.
    As we come to the conclusion of this century, it is worth noting an 
important historical symmetry. NIH began as a small laboratory on 
Staten Island, tending to the needs of merchant marine sailors at the 
turn of the last century. The Laboratory of Hygiene proved its worth 
after diagnosing cases of cholera among immigrant passengers on the 
steamship ``Alesia''--the first diagnosis of cholera in the western 
hemisphere. That landmark discovery was made possible through 
collaborations with the laboratory of Robert Koch in Berlin, who 
pioneered methods to isolate bacteria, and the laboratory of Louis 
Pasteur in Paris. This early discovery presaged the very practical 
benefits of public investments in basic research. It also signaled our 
reliance on international cooperation to accelerate the pace of 
discovery in medical science. This is our historic tradition, our 
public trust, and our mission at FIC.
    Mr. Chairman, my colleagues and I will be happy to respond to any 
questions you may have.
                                 ______
                                 
               Prepared Statement of Donald A.B. Lindberg
    Mr. Chairman and Members of the Committee: I am pleased to present 
the President's budget request for the National Library of Medicine 
(NLM) for fiscal year 1999. The President in his fiscal year 1999 
budget has proposed that the NLM receive $171.3 million, an increase of 
$13.4 million over the comparable 1998 appropriation. Including the 
estimated allocation for AIDS, total support proposed for the NLM is 
$174.7 million, an increase of $13.5 million over the 1998 
appropriation. Funds for the NLM efforts in AIDS research are included 
within the NIH Office of AIDS Research budget request.
                              free medline
    I am proud to tell you the NLM has accomplished what I suggested to 
you last year when I said ``it might actually be possible to offer 
MEDLINE without charge.'' This suggestion was echoed a week later in 
the testimony of world renowned heart surgeon Dr. Michael DeBakey, who 
chairs the NLM Board of Regents. It actually happened less than 3 
months later, on June 26. Senators Arlen Specter and Tom Harkin 
provided a public forum for the announcement that the NLM would provide 
MEDLINE free to all users of the Internet and World Wide Web. Vice 
President Gore did the ceremonial ``first free MEDLINE search.'' 
Successfully, I might add. A new feature introduced was the ability to 
link a MEDLINE user who wishes to get a full article directly to the 
home page of a number of medical publishers, where articles may be 
viewed or ordered. So far, about 100 journals are linked to MEDLINE and 
the number continues to increase.
    Today, the world's largest database of peer-reviewed medical 
information is being queried more than 300,000 times each day--more 
than a tenfold increase in less than a year. Who is doing all this 
MEDLINE searching? The traditional users, of course: doctors and other 
health professionals, librarians, scientists, and students. They are 
delighted with the new (and free) easy-to-use methods of access we have 
provided. But the more profound change is that the public--consumers, 
patients, parents, and other patient advocates--can now use MEDLINE to 
learn more about their own health and about how the results of medical 
research can affect it. This change has been fueled by widespread 
publicity of the announcement, including items in daily papers, weekly 
news magazines, consumer and other popular magazines, and televised 
reports; there were even episodes on NBC's ``ER'' and CBS's ``Chicago 
Hope'' that hinged on a MEDLINE search! Because of all this, MEDLINE is 
now being used by tens of thousands of people who a year ago had never 
even heard of it. Although many of the articles referenced in MEDLINE 
are too technical for the average person to understand, I believe that 
there is much in MEDLINE that is pertinent and useful for consumers. I 
am announcing here that we have begun to add references from carefully 
selected health newsletters for the public published by medical schools 
and other government agencies. We plan to enrich MEDLINE so that it 
will have even more information oriented toward the public.
                                outreach
    In expanding the potential audience for MEDLINE we will be relying 
more and more on the outreach mandate. You may recall that our 
legislation was amended directing us to publicize our services. The 
tremendous recent growth in MEDLINE searching notwithstanding, we still 
have a long way to go before every health professional knows about 
MEDLINE and how it can contribute to high-quality medical care. Our 
services are no longer even bound by national borders, since the 
Internet makes MEDLINE accessible around the globe. In fact, the NLM 
Board of Regents recently approved the report of a 2-year study of 
NLM's international programs; one recommendation was that the NLM 
should be a flexible partner and encourage the use of electronic 
information resources by health professionals in other countries. I 
should note that some 50 percent of MEDLINE records are from non-U.S. 
journals. Another international project, begun in 1997 at the request 
of the NIH Director, aims to enhance the ability of African malaria 
researchers to communicate electronically with colleagues in Africa and 
around the world and to access critical biomedical information from 
local libraries, remote databases, and the Internet. The project is 
part of the African Multilateral Initiative on Malaria.
    The Library is targeting outreach efforts to several audiences that 
we believe can use our services to great advantage. We recently 
conducted a ``train the trainer'' program to teach older citizens how 
the Web can be used as a source of good health information. We want to 
set in motion a multiplier effect that will spread to senior centers, 
public libraries, and nursing homes across the country. AIDS is another 
special emphasis area. NLM's AIDS-related databases contain information 
that is useful to patients, families, and care providers, and we are 
working with community groups, including public libraries, to reach 
them. We are also reaching rural and other underserved health care 
professionals to show them how the Library's electronic information 
services can reduce professional isolation and put them in touch with 
the latest currents in biomedicine.
    The NLM's Toxicology and Environmental Health Information Program 
has operated for many years and is only now getting the attention it 
deserves. A panel of distinguished scientists assembled by the 
Institute of Medicine has recommended that the toxicology and 
environmental health databases be made much more easily accessible and 
widely available (such as the NLM has done with MEDLINE). Those 
underutilized databases contain a wealth of information that could be 
used by scientists, educators, and the public in dealing with 
pollution, chemical spills, and other threats to the environment.
    The NLM's outreach activities could not be successful without the 
assistance of the National Network of Libraries of Medicine (NN/LM). 
The mission of the Network is to make biomedical information readily 
accessible to U.S. health professionals irrespective of their 
geographic location. The eight Regional Medical Libraries that form the 
backbone of the Network are supported by contracts from the NLM. The 
4,500 member institutions serve as the Nation's medical information 
infrastructure and provide a wide range of services, many of which are 
based on information resources provided by NLM. We have supplemented 
the contracts throughout the eight regions, to encourage innovative 
outreach projects, and plan to invest even more in the coming year. 
Closely connected to the NN/LM is NLM's Extramural Program for 
providing grant assistance. Several programs are outreach-related, 
including support to medical institutions to connect to the Internet. 
Other programs are for improving library resources of the NN/LM, health 
science communications, and research training in medical informatics.
                        next generation internet
    Usage of the Internet and World Wide Web has exploded. To ensure 
that the Internet will be up to handling future demand, a Next 
Generation Internet (NGI) initiative has been formed. This is a 
partnership between industry, academia, and several government science 
agencies, including the NLM. The NGI is a logical outgrowth of the High 
Performance Computing and Communications (HPCC) initiative and will 
provide affordable, secure information delivery at rates thousands of 
times faster than today and accelerate the introduction of new 
networking services for businesses, schools, hospitals, and homes. The 
NLM, which has in the past conducted a number of HPCC-related 
activities, plans to sponsor a variety of NGI health-care applications 
in such areas as advanced telemedicine, digital libraries, and distance 
learning. Such applications often require the nearly instantaneous 
transfer of many gigabits of data, for example in applications 
involving imaging. As important as the ability to transfer massive 
amounts of data--perhaps more important for health care--is the 
requirement for guaranteed quality of service and security of private 
information over the Next Generation Internet.
    One of the most important aspects of the NGI in the health sciences 
is the use of computer and telecommunication technology for medical 
diagnosis and patient care--what has come to be called telemedicine. 
The concept encompasses everything from the use of standard telephone 
service to high-speed transmission of digitized signals in conjunction 
with computers, fiber optics, satellites, and other sophisticated 
peripheral equipment and software. The NLM has made a commitment to 
furthering telemedicine by sponsoring several dozen projects around the 
country, in a variety of rural and urban settings. Through these 
projects, now in their second year, we hope to evaluate the impact of 
telemedicine on cost, quality, and access to health care. Playing an 
important role in all these projects are two studies recently released 
by the National Academy of Sciences (and co-funded by NLM) on criteria 
for evaluating telemedicine and on best practices for ensuring the 
confidentiality of electronic health data. We expect the NLM-supported 
projects to serve as models for both evaluation and confidentiality. 
The NLM has just commissioned a third study by the Council that will 
take a hard look at the elements required if the NGI is to be of 
maximum service to health care and medical research. Capacity, quality, 
reliability, and security are some of the elements that will be 
evaluated; a strategy to achieve this infrastructure will be proposed.
    Also intimately related to the NGI is Phase II of the Digital 
Libraries Initiative. The goals of the first phase were to advance 
fundamental research and build testbed networks for new technologies 
that capture, store, search, and retrieve knowledge from distributed 
electronic collections. Phase II, which is just under way, seeks to 
extend this technology to new application areas. NLM will contribute 
funds to this effort in order to assure that biomedical research 
institutions have an opportunity to compete for research grants and to 
develop imaginative and useful digital library applications of the NGI.
    One of the most fascinating of the Library's high-tech enterprises 
is the Visible Human Project. This program has produced computer-
generated images of two cadavers, one male and one female. NLM's 
relatively modest investment in the project has resulted in more than 
1,000 licenses for use of the datasets by individuals and corporations 
in 27 countries. Thanks to the Visible Humans, doctors can practice 
procedures on ``surgical simulators''; medical students can conduct 
dissection over and over using a CD-ROM called ``The Recyclable 
Cadaver''; and non-invasive cancer screening techniques such as 
``virtual colonoscopy'' are being developed.
                 molecular biology information services
    Also closely connected to the NGI are the programs of NLM's 
National Center for Biotechnology Information (NCBI). The NCBI 
continues to advance the state of the art in analyzing the rapidly 
expanding wealth of information about our genetic makeup. NCBI has the 
most extensive and complete databases on DNA and protein sequence data 
in the world and logs over 2 million web hits a day. By all accounts it 
is the single most heavily used site in the world for molecular biology 
information. NCBI scientists collect and analyze molecular sequence 
information from laboratories at NIH around the world. The database, 
GenBank, recorded a milestone when the one billionth base was added 
just a few months ago--it took 18 years to collect the first one 
billion bases, but because of the explosive rate of growth, the second 
billion bases will probably be in the database just 18 months from now. 
NCBI has also been assembling all the data available on human genes 
resulting from the Human Genome Project. The NCBI's Human Gene Map now 
contains information on over 32,000 genes, nearly one-half of total 
estimated human genes. The Human Gene Map is on the web and allows 
everyone from a high school student to a Nobel laureate to find genetic 
information at his or her level of expertise. Another scientific 
resource the NCBI recently created is the database on the genetics of 
Plasmodium falciparum sequences, the organism that produces the most 
severe form of malaria and is responsible for most of the 2 million 
malaria deaths each year.
    NCBI has distinguished itself as an international focus for genomic 
information research and is in the forefront in applying this wealth of 
information to the detection and diagnosis of genetic disease. In 
collaboration with the National Cancer Institute, NCBI has embarked on 
a major project to produce the ``molecular fingerprint'' of cancer 
cells, to characterize what genetic steps occur as cells move from 
normal to cancerous states. The ultimate result of this research will 
be a powerful diagnostic tool that will provide a way to identify genes 
that directly cause cancer and identify cells in an early precancerous 
state, thereby enhancing the probability of early treatment.
                         basic library services
    Basic library services are the foundation on which is built the 
many advanced information products and services offered by the Library. 
The collection, begun in 1836, now numbers more than 5 million. 
Important as the collection itself are the Library's lending activities 
and cataloging and indexing services that make the information widely 
accessible through publications like the Index Medicus and databases 
such as MEDLINE. Several important workload indicators hit all-time 
highs in fiscal year 1997: a total of 519,000 journal articles were 
indexed for the databases (one-third more than the previous record). 
There were 630,000 requests from libraries around the world and on-site 
patrons for materials from the NLM collection (+8 percent). The trend 
is for steady growth in the collections, bibliographic and other 
databases that derive from the collections, and information services 
that depend on both. Basic library services must be protected if the 
Nation is to continue to benefit from its investment in biomedical 
research.
    The activities of the NLM are covered within the NIH-wide Annual 
Performance Plan required under the Government Performance and Results 
Act (GPRA). The fiscal year 1999 performance goals and measures for NIH 
are detailed in this performance plan and are linked to both the budget 
and the HHS GPRA Strategic Plan which was transmitted to Congress on 
September 30, 1997. NIH's performance targets in the Plan are partially 
a function of resource levels requested in the President's Budget and 
could change based upon final Congressional Appropriations action. NIH 
looks forward to Congress' feedback on the usefulness of its 
Performance Plan, as well as to working with Congress on achieving the 
NIH goals laid out in this Plan.
    My colleagues and I will be happy to respond to any questions you 
may have.

                           Budget submission

    Senator Specter. Dr. Varmus, I begin with a question which 
you and I discussed when we dedicated the building to our 
distinguished colleague, Senator Hatfield.
    As I understand it, there are two budgets submitted, one 
which you give to OMB, which I believe you call an optimum 
budget--is that so?
    Dr. Varmus. Yes; that is our budget request.
    As I explained to you in our letter, we had abandoned the 
time-honored tradition of making a very blue sky professional 
judgment budget and, instead, had provided to OMB our best 
estimate of what could be done given fiscal and political 
constraints to OMB as part of the negotiation with OMB over our 
budget.
    We provided you yesterday with more of a traditional 
professional judgment budget, developed by each individual 
Institute and center--this is not a coordinated NIH final 
number but a set of numbers developed by each of the Institutes 
and centers.
    Senator Specter. Would that be like the so-called optimum 
request?
    Dr. Varmus. No; it is more like the traditional 
professional judgment budget. The optimal request we put in to 
OMB this year was 10 percent above the fiscal year 1998 House 
mark, which was lower than our final fiscal year 1998 
appropriation.

                             Grant funding

    Senator Specter. Well, the question that I would like to 
have answered is if you had your druthers--or let me articulate 
it more precisely--if you had funds to make as many grants as 
you think are worthy, without the constraints of a budget and 
the limitations necessarily imposed by OMB, what would the 
figure be?
    Dr. Varmus. That is a number that has been put together by 
the individual Institutes and it is a number that comes out to 
be on average, about 23 percent above our appropriated level.
    But I have two things to say, Mr. Chairman. First is that 
at NIH, we feel very strongly that we can accomplish a 
tremendous amount, be extremely happy, and have a very 
productive research environment with the President's request.
    Second, I find it difficult to make a clear recommendation 
without taking into consideration the realities that exist--
namely, that if NIH is awarded too much, it may be at the 
expense of other very worthwhile programs that the President 
has indicated an interest in, including programs that are 
supported by other Federal science agencies whose work is very 
important to our ultimate goals.

                           NCI bypass budget

    Senator Specter. Dr. Klausner of NCI, in the President's 
budget, it is $2.7 plus billion, but the professional judgment 
is $3.19 billion. Dr. Klausner, what is the difference in what 
you would accomplish with the $3.19 billion than the $2.77 
billion?
    Dr. Klausner. Senator Specter, the $3.19 billion is the 
number from the NCI bypass budget, which I am requested to 
prepare by law and present to the Congress.
    That bypass budget of $3.191 billion emerged from a pretty 
long process of prioritization and planning, and with that, 
compared to the President's budget, it is clear that we would 
be able to fund more like one-third of the grants, as opposed 
to about 28 percent. That is one of the differences.

                         Clinical trial system

    Second, one of the major differences is that we are looking 
toward a major expansion in our clinical trial system, both an 
expansion and a redesign of our national clinical trial system. 
That is quite an expensive proposal and enterprise. The 
difference between those numbers very much depends upon the 
speed with which we can expand the clinical trials system so 
that the trials are faster, they accrue faster, they end 
faster, so that we can do more trials, and we can transform the 
clinical trial system from one that has been based, really, on 
a paper and pencil system for over 40 years to a new 
informatics-based electronic system and one that can more 
readily accommodate the more complex clinical trials that are 
associated with biologic markers, with genetic predisposition, 
with measures of the environment, et cetera.
    So the difference would be the time it would take to rampup 
our clinical trial system, for example, to a size that we think 
would be optimal.

                          Grant funding policy

    Senator Specter. Dr. Klausner, you say the difference in 
grant awards would be from 28 percent to 34 percent?
    Dr. Klausner. About that, yes.
    Senator Specter. I am not challenging this, but what is the 
rationale for stopping at 34 percent? May there not be some 
great ideas behind those unopened doors in the remaining 66 
percent?
    Dr. Klausner. Yes; there may well be.
    Our feeling at this moment is that this is something we 
want to build to. We do feel that the peer review system, that 
does not necessarily simply reject grants but critiques them, 
provides feedback so that the grants that are submitted then 
could be improved and submitted again.
    Senator Specter. Well, my question is what is the rationale 
for setting 34 percent and not having others?
    As I look at the country's priorities and look at health 
care and the fact that we have a $1 trillion budget on health 
care. We look at $14 billion, which is a small fraction, would 
we not be better off as a country? Instead of granting 34 
percent of the grants, to grant 68 percent of the grants.
    I know that you don't have the whole budget before you, but 
the Congress does. What I am trying to find out is at what 
rational point do you stop and say that 34 percent is the line 
we ought to draw?
    You are not even getting that, of course; you are at 28 
percent.
    Dr. Klausner. Right.
    Senator Specter. But I have a conviction--we went through 
this in some detail in 1995, after the House cut $900 million. 
We came to a hearing and we had the Hatfield-Specter-Kassebaum 
amendment--Senator Hatfield, because he was chairman of the 
full committee, and I of the subcommittee, and Senator 
Kassebaum because she was chairman of the authorizing 
committee. Unfortunately, we don't have Senators Hatfield and 
Kassebaum around anymore.
    But why not more?
    Dr. Klausner. I think that is a very good question. Our 
view is that, ultimately, we would like all of the good ideas 
funded. But we do think that what this percentage means is 
this. A number of the grants that come in are reviewed by peer 
review, and, after the peer review, are sort of, in essence, in 
a range that are automatically funded. There are other grants 
beyond that which we actually hope to fund, but they go through 
a process of revision based upon the feedback, the input of 
peer review, which, actually, we think is quite healthy.
    So there is, I think, for all of us this tension of wanting 
to make sure that all of the excellent grants are funded and 
wanting to maintain a robust and competitive peer review 
system. Is it exactly 34 percent or 35 percent? I think for all 
of us, we don't know where exactly that is.
    We think quickly moving up toward about the 33, 34, 35 
percent will both maintain the value of the responsiveness of 
the peer review system and will assure that more excellent 
grants are funded.

                    funding for Alzheimer's disease

    Senator Specter. I would like to move now to Alzheimer's, 
which has a tremendous amount of emphasis in the public mind. I 
understand Alzheimer's is divided among a number of categories.
    Whom can I sensibly ask to respond on Alzheimer's?
    Dr. Varmus. There are four Institutes that have major roles 
in Alzheimer's research. I would recommend asking the National 
Institute on Aging which has taken the lead in coordinating the 
research among those four Institutes.
    Senator Specter. And whom would I call on there?
    Dr. Varmus. Dr. Hodes.
    Senator Specter. OK, Dr. Hodes. You are quite a way away 
from my dais, so it is tough to see you.
    Dr. Hodes, why not more money for Alzheimer's?
    Dr. Hodes. I think as you have heard and seen in our 
written submissions, there certainly is a great deal of 
scientific opportunity for research on Alzheimer's disease.
    Under the President's budget, the NIH overall budget and 
allocations to Institutes, there is potential for substantial 
commitment to Alzheimer's. The overall expenditures at NIH for 
1999 estimated under the President's budget are about $374 
million, about three-fourths of which is likely to be funded 
through NIA, the rest through other Institutes which also have 
substantial efforts in that area.
    Senator Specter. How close are you, if you can quantify it 
or if it is a sensible question, to deferring Alzheimer's by 5 
years? I keep hearing the statistic that if you defer 
Alzheimer's by 5 years, it saves $40 billion.
    First, is that a sensible estimate?
    Dr. Hodes. It is a best estimate in an imperfect area of 
prediction.

                      delaying Alzheimer's disease

    Senator Specter. OK. How close are we to deferring it for 5 
years?
    Dr. Hodes. That is not easily answered. It's probably not 
right around the corner. The best of any accomplished results 
to date are quite modest and speak of delays in the progression 
of symptoms by a small number of months.
    There is, however, a great deal of hope in the form of 
leads that have come, for example, from epidemiological 
studies, suggesting that women with a history of postmenopausal 
estrogen use, or men or women with a history of nonsteroidal 
anti-inflammatory use, have very striking reductions in their 
risk of Alzheimer's--in the range of 50 percent.
    These kinds of exciting suggestions from correlations in 
epidemiology will lead to opportunities this year and next, and 
in years to come, for the initiation of clinical trials to 
directly test whether such agents, in fact, are capable of 
delaying the progression of symptoms or even the onset of 
disease.
    Among the high priorities for use of the expanded funds 
awarded under the President's budget will certainly be an 
acceleration of the initiation and accrual of patients in these 
very important studies to see if, indeed, they do have the 
potential for substantial delays of Alzheimer's of the sort 
that you are asking about.

                          Parkinson's disease

    Senator Specter. Let me move to Parkinson's, another high 
visibility item. It is a little hard to judge those from my 
chair, but who, Dr. Varmus, should this next question be 
addressed to?
    Dr. Varmus. Dr. Penn.
    Senator Specter. Dr. Penn.
    Dr. Penn. Yes, sir; the opportunities in Parkinson's 
disease right now I think are very exciting. We are not at a 
brand new therapy. We are investigating therapies that are 
currently available and we are working with the gene that has 
been identified to find out more about what actually is going 
on with those cells that are dying.
    Senator Specter. I hear talk about identification. Is it 16 
genes? Have more genes been identified?
    Dr. Varmus. In the case of Parkinson's?
    Dr. Penn. Yes; it's more like three or four mutations in 
one major gene.
    We have multiple families where a gene defect will be 
identified, I would think, in the reasonably near future, and 
if those all coalesce to one story, we will be in great shape.
    Senator Specter. Can you give any meaningful estimate as to 
how close you are on Parkinson's disease?
    Dr. Penn. Again, I am going to quote Dr. Hodes. It is not a 
matter of months. It is more a matter of several years out. We 
have multiple therapies, multiple clinical trials in which we 
are trying to work this.
    Senator Specter. So it is several years out. Within a 
decade?
    Dr. Penn. A full decade? I hope not.
    Senator Specter. Good.
    Dr. Penn. I would say it would be a little bit sooner than 
that.

                          Alzheimer's disease

    Senator Specter. How about Alzheimer's? Can you say that 
for Alzheimer's?
    Dr. Penn. I would not want to speak to Alzheimer's.
    Senator Specter. Oh, I am talking to Dr. Hodes on this. Can 
you say that for Alzheimer's, that it is not as much as a 
decade out?
    Dr. Hodes. I think the most that I think I can responsibly 
say is that within a period of 3 to 5 years, we should have 
extremely informative data about how successful the current 
best candidates are. The reason for doing the studies, 
unfortunately, of course, is precisely because we do not have 
any guarantees of what their outcome will be.

                        status of Heart disease

    Senator Specter. Let me turn now to Dr. Lenfant of the 
National Heart, Lung, and Blood Institute.
    Take heart disease, how close are you? What are the 
parameters for an evaluation as to how close you are for 
significant improvements?
    Dr. Lenfant. Mr. Chairman, first of all, I think that over 
the years we have made considerable progress, as evidenced by 
the decline in the death rate from the most prevalent heart 
disease, coronary disease/heart attack.
    As I have reported to you over the years, the decline has 
been approximately 50 to 60 percent during the last 25 years or 
so.
    Today, we have before you a number of alternatives which I 
believe very strongly will allow us to make considerable 
progress, not only in the treatment of this condition, coronary 
heart disease and heart attack, but also to address the 
complication of that condition, which, unfortunately, will 
continue to occur. Heart attacks often result in heart failure, 
which is an ever-increasing problem in this country. We see 
through the advent of molecular medicine, cell biology and the 
understanding of the most intimate component of heart tissue 
the prospect that some day, in the future, we will be able to 
replace current interventions, such as heart transplantation or 
artificial heart--which, as you know, during the last 20 or so 
years were commonly spoken about--by just restoring normal 
heart tissue and basically repairing the damage which is 
responsible for the heart failure.
    So I think that before us we have enormous prospects and 
lots of work is going on at this time which is very, very 
successful.
    Now if your question is when will all that occur, I would 
not venture to give estimates of the time that it will take. 
But I think that in the heart community--just during the 
weekend I was meeting with the American College of Cardiology 
during their early meeting--you can sense their optimism for 
making very significant progress and continuing what we have 
already accomplished during the last 20 or 30 years.
    Senator Specter. Thank you.

                          Alternative medicine

    The subject of alternative medicine has an enormous 
following from what I find on my open house town meetings. That 
office has not been very heavily funded.
    Dr. Varmus, upon whom should I call here?
    Dr. Varmus. To talk about alternative medicine?
    Senator Specter. Yes.
    Dr. Varmus. I think perhaps I would do that.
    Senator Specter. Is the head of the Alternative Medicine 
Department here?
    Dr. Varmus. Well, we have two people who are below me in 
the hierarchy--Dr. William Harlan, who is the head of the 
Office of Disease Prevention, which has oversight of the Office 
of Alternative Medicine, which is handled by Dr. Wayne Jonas. 
But I think I can answer the question for you.
    Senator Specter. Is Dr. Jonas here?
    Dr. Varmus. I don't know.
    Is he?
    [Pause.]
    Dr. Varmus. Dr. Harlan who is the immediate supervisor for 
that office is here, or I could answer the question for you, if 
you like.
    Senator Specter. Does Dr. Jonas not rate high enough on the 
hierarchy to come?
    Dr. Varmus. His office is in a group of offices overseen by 
Dr. William Harlan.

               funding for Office of Alternative Medicine

    Senator Specter. OK.
    Dr. Harlan, you have the floor. But you have to come 
forward to the microphone.
    While he is coming forward, Dr. Varmus, I know, or at least 
I understand, that there has been some resistance to heavier 
funding for alternative medicine.
    Dr. Varmus. I have good news to report there, Senator 
Specter.
    We have taken very good use, I believe, of the additional 
funds that were provided last year, and we have a number of----
    Senator Specter. If Senator Harkin were here, the question 
would not have been so diplomatically stated. [Laughter.]
    Dr. Varmus. That may be. I appreciate the way in which it 
was stated. [Laughter.]
    We have a number of new trials in progress with funds from 
that office. The office is working extremely well with the 
Institutes. We formed a transagency, Public Health Service-wide 
coordinating committee to look at alternative practices. I 
think the whole operation is on a much better footing.
    Dr. Harlan.
    Dr. Harlan. I would agree with Dr. Varmus.
    The progress, I think, has been very encouraging.
    Senator Specter. Did you say that you do agree with Dr. 
Varmus?
    Dr. Harlan. Sorry?
    Senator Specter. You say that you do agree with Dr. Varmus?
    Dr. Harlan. I do.
    Senator Specter. I would have been surprised if you had 
not. [Laughter.]
    Dr. Varmus. I would have been extremely disappointed, 
Senator. [Laughter.]
    Senator Specter. Go ahead, anyway.
    Dr. Harlan. Let me agree with the adjectives and adverbs 
that he has applied. I think the cooperation has really been 
outstanding with the Institutes in terms of developing new 
studies and new initiatives coming from the Office of 
Alternative Medicine.
    The other thing that I think is quite striking is the 
ability of the office to combine the scientific expertise 
within the Institutes with the office and come together with a 
product that I think represents the best in science.
    Senator Specter. Dr. Varmus, on assessing the priorities, 
why on a relative basis has alternative medicine been given so 
little, relatively?
    Dr. Varmus. The function of the office is to coordinate 
research in this area and to carry out research in cooperation 
with the Institutes.
    The office has funds which are involved in setting up data 
bases, which has been done very effectively, especially with 
the cooperation of the Library of Medicine in the last year, to 
oversee the world's activities in this area--what people are 
actually doing--and providing guidance to the Institutes. The 
budget of the office went from roughly $12 million to about $20 
million, a very substantial increase, in 1998. That new money 
was used to start a variety of clinical trials which will then 
be picked up by the Institutes.
    Senator Specter. But not much of an increase from 1998 to 
1999, just $1.5 million.
    Dr. Varmus. That is about an NIH average.

request for comprehensive account of Federal activities in Alternative 
                                medicine

    Senator Specter. This subcommittee has requested a 
comprehensive accounting of current Federal activities in the 
field. The report which we received notes the only work done up 
to now has been a search of Internet sites of Federal agencies. 
Obviously, on its face, this is inadequate.
    We are very interested to receive a complete report as to 
what is being done in the Federal Government and what is being 
done abroad. This way we can have a comprehensive compendium on 
this subject.
    I want to emphasize, as I know Senator Harkin would if he 
were here, the tremendous interest that there is among the 
people on this subject. Just today, the front page of the New 
York Times has that remarkable story about the 11 year old. I 
will not ask you if you have retained her.
    Dr. Varmus. I'm sorry we didn't fund her, Senator.
    Senator Specter. Well, I think we could handle that on a 
funding basis. [Laughter.]
    I would ask you to make a high priority on reporting to 
this subcommittee what is going on in alternative medicine and 
to give us a projection as to what more could be done.
    It is not inappropriate to respond to public interests and 
public concerns.
    Dr. Varmus. I agree.
    Senator Specter. There is a tremendous amount in the 
literature. My colleagues and I are very frequently asked why 
not more and what is being done and isn't there something 
really here?
    We talked about this in the past and I appreciate the jump 
from $11.9 million to $20 million between 1997 and 1998. 
However, I have a sense that more is in order, given the scope 
of your budget and given the scope of the public interest.
    Did you want to make a comment?
    Dr. Varmus. Just very briefly, Senator.
    I was hoping to be able to give you that report today. We 
still lack a few responses from other agencies that we are 
surveying. We know you want the report.
    We will add to the report some responses to the questions 
you have raised today. I would like to give you a brief 
description of the transagency oversight we are providing and 
some indications of new directions the Institutes would like to 
take in cancer, arthritis, and several other areas that I think 
you would find interesting.
    Senator Specter. There is another vote on, as I had said 
earlier there would be. I am going to have to excuse myself for 
just a few minutes. I shall return promptly and I will ask you 
all to wait.
    We will recess for just a few minutes.
    [A brief recess was taken.]
    Senator Specter. We will turn on the 5-minute clock for 
rounds of questions by Senators.

                      Alternative medicine abroad

    Dr. Varmus, when we recessed, we were talking about 
alternative medicine. What can be collated with respect to the 
medical information on alternative medicine beyond the confines 
of the United States?
    Dr. Varmus. What we have done recently is to make use of 
the National Library of Medicine to make all articles in all 
journals that describe activities in the alternative medicine 
research available to anyone who goes into the data base. That 
includes journals from all over the world.
    Senator Specter. Including those which go beyond the United 
States?
    Dr. Varmus. Actually, the majority of those journals are 
not even in English. But we have translations and summaries.

                     progress of HIV/AIDS research

    Senator Specter. To whom should I direct a question 
regarding AIDS funding, Dr. Varmus?
    Dr. Varmus. Either to Dr. Whitescarver, who is the Acting 
Director of the Office of AIDS Research, or Tony Fauci, the 
Director of NIAID, or to me.
    Senator Specter. Let's go to Dr. Whitescarver, who was 
first mentioned.
    Similar to the questions posed, could you summarize the 
progress on the research as to AIDS? Is it a realistic question 
to provide some approximate date when we might look for a cure?
    Dr. Whitescarver. Thank you, Mr. Chairman.
    AIDS has enjoyed some substantial support and many 
scientific opportunities, which I think have been addressed in 
a timely manner. As a result of that, we have therapies that 
have contributed to reduced hospitalization and people living 
longer.
    The mortality rate has dropped considerably.
    So I think there has been a great deal of progress in the 
last few years. We still have a long way to go because this 
epidemic is certainly not over. It is far from over and we 
don't know about the long-term efficacy of these new drugs, how 
long their benefits are going to last. There are already some 
problems coming up.
    But the good news is there are second generations of these 
drugs in the pipeline. The molecular biologists have identified 
targets for drug development, new targets, therefore, new 
therapies are on the horizon.
    To answer the second part of your question, I think that is 
very difficult, once again, as with most diseases to put a time 
on a cure or even a prevention. But I think we are moving 
rapidly in that direction, at least to put AIDS in the 
perspective of a chronic, manageable disease.
    Senator Specter. Dr. Penn has estimated Parkinson's disease 
well within the decade. Could HIV be put in the same category?
    Dr. Whitescarver. I think it would be safe to say, as a 
chronic manageable disease and maybe even a cure, within 10 
years, yes.

                            Clinical trials

    Senator Specter. Thank you.
    Dr. Varmus, on the issue of clinical trials. There has been 
a lot of concern about whether there are sufficient resources 
being developed. I know you have accentuated that issue. Are we 
doing enough on clinical trials with your current projection?
    Let me rephrase that. Why do you think we are doing enough 
on clinical trials with your current projection?
    Dr. Varmus. I would say that we are doing more. I don't 
think the word ``enough'' is a word that I would use here.
    There are several problems. One is the problem of having 
adequate number of trained personnel to carry out clinical 
research, clinical trials, in particular. The second issue is 
one of patient accrual into clinical trials. The third is 
simply supporting the clinical trials processes themselves 
which, as you know, are very expensive.
    You have heard today from a number of investigators whose 
Institutes are markedly expanding their clinical trials 
activities.
    In cancer, for example, there are many more, four or five 
times more drugs in the pipeline than there were 5 or 10 years 
ago. As a result, if we are going to test all those drugs that 
are being developed, we are going to need more patients in the 
pipeline.
    You have heard about Alzheimer's disease, Parkinson's, and 
AIDS, where there are expanded opportunities for trying out new 
therapies.

                       new Clinical investigators

    Senator Specter. Dr. Varmus, let me interrupt you to focus 
on another aspect here before my orange light goes on.
    I am told the number of first time physician applicants for 
research project grants declined by 30 percent between 1994 and 
1996. At that rate, we may have none by the year 2000.
    Has this trend continued in 1997 and are you concerned 
about this market decline?
    Dr. Varmus. We are very concerned about it, Senator 
Specter. There are some nuances of interpretation here. For 
example, the data do not capture the number of physicians who 
are serving as co-principal investigators and who are, 
nevertheless, doing research.
    In addition, we think that the number reflects changes that 
are occurring at academic health centers, where there is 
increased pressure for doctors to perform care to support the 
center rather than to do research.
    One of the reasons we developed a new training and support 
mechanism for clinical investigation, the so-called K-23 and K-
24 awards, is to ensure that a larger number of people enter 
clinical research and are able to sustain the activity, despite 
other demands on their time.
    Senator Specter. In order of arrival, as is our protocol, 
Senator Kohl.

                                Epilepsy

    Senator Kohl. Thank you, Senator Specter.
    Dr. Varmus, I would like to talk about epilepsy with you 
this afternoon. Is it Dr. Penn to whom I would address my 
question?
    Dr. Varmus. Yes; that would be appropriate.
    Senator Kohl. Dr. Penn, I am interesting in focusing on 
diseases that affect children, particularly epilepsy.
    Nearly 2.5 million Americans suffer from epilepsy and 30 
percent are children. Currently, NINDS spends approximately $55 
million on research for epilepsy while much larger amounts are 
spent on other diseases that affect far fewer people.
    I do not want to pit one disease against another, but I am 
interested in knowing how you make decisions on funding 
neurological disorders within the NINDS. How do you decide on 
this smaller amount for epilepsy, given the large number of 
Americans who suffer from epilepsy?
    Do you think that epilepsy should get more research 
dollars?
    Dr. Penn. We, like other Institutes, Senator, work toward 
opportunity and really good clinical research. In epilepsy, we 
have several very nice studies going, both basic and clinical, 
and particularly in our own program in the Institute, we are 
working to actually develop more drugs for children with 
epilepsy.
    The issue of priority setting and which disorders at any 
one time may get more money or less money is partly the 
science, partly the investigators out there. We don't 
particularly want to try to pit one disease against another, 
either. But there are times when there is great opportunity in 
one disorder and perhaps others are just going along.
    We have major epilepsy centers. We have a major epilepsy 
center at Children's Hospital in Philadelphia, actually, for 
childhood epilepsy.
    We are very concerned about the fact that a lot of 
childhood epilepsy is somewhat hard to treat. You need multiple 
drug therapy. We have an advisory committee to our drug 
development program looking at these very issues.
    So it is not really a low priority with us. In fact, in the 
last several years it has taken on a very high priority, 
especially for children.

                            Epilepsy funding

    Senator Kohl. I am not sure I understood the import of your 
answer. I was suggesting that since there are so many more 
Americans suffering from epilepsy, particularly children, than 
other diseases relative to the amount of money that is spent on 
research, I do not understand why we do not commit more money 
to epilepsy, given the number of Americans who are suffering 
from epilepsy. Perhaps you can elaborate on this.
    Also, I understand that there is conceivably a cure for 
epilepsy that is out there, given enough research, that is out 
there within our grasp, given sufficient dollars for research, 
that developing a cure for epilepsy or a prevention in the 
first place is not beyond your conception, but that research 
dollars need to be committed.
    Could you comment on that, please?
    Dr. Varmus. Perhaps I could make a comment, Senator.
    First of all, there are many patients with epilepsy who are 
very successfully treated. There is a long history of research 
on epilepsy that has given us a number of medications that are 
extremely effective in controlling the disease.
    Second, as Dr. Penn has pointed out, there are oversight 
committees that are looking at possible opportunities for 
research in epilepsy. These committees have been encouraging 
drug development for pediatric patients and those patients that 
have refractory epilepsy.
    Third, what tends to happen in a field like epilepsy is 
that a new discovery encourages people to come into the field. 
That has happened in a very dramatic way in the last couple of 
years with the discovery of some genetic diseases whose mutant 
genes have actually been isolated in the last year or two. 
Those discoveries give us dramatic new insights into how 
structural abnormalities in nerve cells can contribute to the 
disordered electrical activity that leads to epileptic 
seizures.
    We think those discoveries are going to draw many new 
people to this field and that we will be getting grant 
applications that will allow the portfolio to increase in the 
best possible way as a result of really outstanding 
applications.
    Senator Kohl. In the event that we will provide 
significantly more funds to NIH over the next several years, 
which I support, do you anticipate spending a significant part 
of that on epilepsy research?
    Dr. Varmus. Yes, sir; we believe that virtually every 
disease we work on is going to benefit both directly and 
indirectly from increased expenditures for health research.

                     Epilepsy--access to treatment

    Senator Kohl. One of the complaints of many families who 
have children with epilepsy is that the research done at NIH 
does not always lead to treatments that families have access to 
and can afford.
    What steps are you taking to make sure that the treatments 
you develop can actually be affordable and used by families?
    Dr. Penn. We work directly with patient groups in our own 
programming with these drugs that we are working to develop. We 
are working really with very small businesses and with drugs 
which larger industries are not that interested in developing.
    It is absolutely critical that we do that because some of 
our larger pharmaceutical industries have not really gone after 
the drugs that we need to treat epilepsy. Some of our best 
drugs are very old drugs. We need some new ones and we need 
them for children.
    Therefore, we are trying to work and we are working 
directly also with the help of the FDA to develop these and, 
hopefully, to keep the costs down. I hear you, sir.
    Senator Kohl. Thank you, Dr. Penn and Dr. Varmus.
    Thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Senator Kohl.
    Senator Cochran.

                 prepared statement of Senator Cochran

    Senator Cochran. Thank you, Mr. Chairman.
    Mr. Chairman, I have a prepared statement which I hope can 
be printed in the record along with a question on the subject 
of clinical research, which you raised of Dr. Varmus.
    Senator Specter. Without objection, it will be made a part 
of the record.
    [The statement follows:]

               Prepared Statement of Senator Thad Cochran

    Mr. Chairman, I believe as you do that there must be a 
strong federal commitment to medical research. Through the 
commitment of this Congress and the diligent efforts of the 
National Institutes of Health, an ever-expanding base of 
scientific knowledge about health and disease is being 
developed that has already begun to revolutionize both our 
approach to scientific inquiry and the practice of medicine.
    Part of this medical research revolution is occurring in 
Mississippi. With NIH support, the University of Mississippi 
Medical Center, in conjunction with Jackson State University 
and Tougaloo College, is initiating a major study of 
cardiovascular disease in African Americans--the Jackson Heart 
Study. We are hopeful that the partnership between NIH and 
these Mississippi schools will yield important new findings on 
how to deal more successfully with this serious problem.

                        translation of Research

    Senator Cochran. On another subject, we all are supporting 
increased funding for NIH. There is no question about the 
consensus here in the Congress that more money is needed for 
the programs that you administer. The President has requested 
an increase in funding.
    It raises a question about whether we are doing enough to 
be sure that the findings of the research are being translated 
into programs of prevention, education, and the rest. I know 
the Centers for Disease Control is involved in some programs in 
our State, for example, and cancer screening is one example.
    To what extent are you working with CDC and shouldn't there 
be a concomitant increase in CDC funding or program funding of 
that kind to keep pace with the new findings that you are going 
to come up with with the new money that is going into research?
    Dr. Varmus. Senator, all of the centers of the CDC work 
extremely closely with the Institutes of the NIH. As I 
mentioned to you during the recess, when I was down at the CDC 
a couple of years ago, I was very impressed with how much 
interaction goes on. I would be happy to provide you with the 
long list of collaborative enterprises we are engaged in with 
the CDC.
    As you may also know, the Department of Health and Human 
Services developed a health research initiative that includes 
not only NIH but also the CDC and the AHCPR. We try to 
coordinate our research activities through that research fund, 
and we believe that we do perform complementary activities.
    All that being said, the CDC is not the only instrument by 
which the findings that NIH generates are transmitted to the 
public. The NIH has a very deep investment in prevention 
research; we spend over $3 billion in prevention research 
activities. We have considerable outreach through public health 
communications and direct contact with professional groups and 
with patient groups. We have an elaborate computer outreach and 
telephone outreach. We prepare instructive manuals on many 
topics. So we consider the CDC to be our partners in doing that 
phase of work, which we also agree is very important.
    The National Library of Medicine has a special set of 
skills that are applied to telemedicine--to making medical 
information accessible to the public--and it might be useful to 
hear from Dr. Lindberg on that topic.

                       Diabetes research workshop

    Senator Cochran. I want to ask you about a couple of other 
things and if I have time in my 5 minutes, I will ask for 
additional information on that subject.
    I would like for you to give us a status report or update, 
or one of your colleagues, on the last conference that you had 
on diabetes research.
    I know there was a recent meeting of a diabetes research 
working group. I would like to know, if you could tell us, what 
the outcome of these meetings have been? Does the budget 
reflect a request for additional funding to implement any of 
the recommendations that might have been made?
    Dr. Varmus. We have had a number of important meetings, 
perhaps the most central of which was a workshop held early 
last September to look for unexplored opportunities in diabetes 
research. That was a propitious time for such a meeting because 
the Balanced Budget Act of 1997 also included a research 
initiative of $30 million per year for 5 years directed toward 
type I diabetes. The workshop provided a blueprint for that 
research.
    In addition, there has been increasing interest in response 
to the high rates of diabetes, especially in some of our 
minority populations and as a consequence of the increasing 
role obesity plays in our society.
    I think Dr. Gorden, from NIDDK, who has taken the lead role 
in coordinating research carried out by many Institutes of the 
NIH on diabetes related topics, might want to comment briefly.
    Dr. Gorden. Senator Cochran, good afternoon.
    Senator Cochran. Good afternoon. It is good to see you, a 
fellow Mississippian. Let's all rejoice. [Laughter.]
    Dr. Gorden. We hope we are doing very well, Senator. I 
would just echo what Dr. Varmus has said. Really, the momentum 
that was generated at the September 4 meeting which Dr. Varmus 
participated in has carried through. We have a working group 
that has been congressionally authorized, that is starting to 
meet and will meet again at the end of this month, which will 
help us define a clearer blueprint for what we think we need to 
build in the future.
    But we think we have put in place strategies that relate to 
both treatment and even new strategies that relate to 
prevention. We are really at the interface of trying to 
discover causes of diabetes, of which there are many.
    So we think we have things in place that are going to 
address all of those important issues. As for the support we 
have gotten from the community in terms of planning and helping 
us, in terms of outreach, as you have mentioned before, we have 
also put into place an education program in collaboration with 
the CDC. This is a very active, very new program that was just 
inaugurated now in order to translate some of the discoveries 
that we have already accomplished.
    So there is really a very good mood in the community right 
now, a very positive movement, and I think we are all very 
excited about the prospects.

                       Children learning to read

    Senator Cochran. Thank you very much.
    Let me ask my final question to Dr. Duane Alexander, who is 
Director of the National Institute of Child Health and Human 
Development.
    Last year, during our hearing, we talked about research 
that had been done by this national institute and the fact that 
there were findings that really were not being used by other 
agencies of Government or by school districts. This is in the 
area of how to deal with the problem of children learning to 
read.
    There were congenital and other factors that were 
discovered that were important in these situations. I would 
like for Dr. Alexander, if he could, to give us a status on the 
results of our efforts last year. We included language in our 
committee report about developing a national panel to translate 
the research into programs that could be used in the classroom 
for teacher education and for helping diagnose and screen 
children who had learning difficulties.
    I do want to put in the record, if the chairman will 
permit, a copy of the statement by Dr. Alexander last year and 
our committee report to remind us of what we had done last 
year.
    Senator Specter. Without objection, it will be made a part 
of the record.
    Senator Cochran. Thank you.
    [The information follows:]
                   Reading Development and Disorders
    As requested, the statement provided for the record last year by 
Dr. Alexander follows:
    ``I think that it is important to point out that our intensive 
research efforts in reading development and disorders is motivated to a 
great extent by our seeing difficulties learning to read as not only an 
educational problem, but also a major public health issue. Simply put, 
if a youngster does not learn to read, he or she simply is not likely 
to make it in life. Our longitudinal studies that look at children from 
age five through their high school years have shown us how tender these 
kids are with respect to their own response to reading failure. By the 
end of the first grade, we begin to notice substantial decreases in the 
children's self-esteem, self-concept, and motivation to learn to read 
if they have not been able to master reading skills and keep up with 
their age-mates. As we follow them through elementary and middle school 
these problems compound, and in many cases very bright youngsters are 
deprived of the wonders of literature, history, science, and 
mathematics because they cannot read the grade-level textbooks. By high 
school, these children's potential for entering college has decreased 
to almost nil, with few choices available to them with respect to 
occupational and vocational opportunities.
    ``In studying approximately 10,000 children over the past 15 years, 
we have learned the following:
  --``At least 20 percent, and in some states 50 to 60 percent, of 
        children in the elementary grades cannot read at basic levels. 
        They cannot read fluently and they do not understand what they 
        read.
  --``However, the majority of these children--at least 90 to 95 
        percent--can be brought up to average reading skills if: (a) 
        children at-risk for reading failure are identified during the 
        kindergarten and first grade years; and, (b) early intervention 
        programs that combine instruction in phonological awareness, 
        phonics, and reading comprehension are provided by well trained 
        teachers. If we delay intervention until nine-years-of-age (the 
        time that most children are currently identified), 
        approximately 75 percent of the children will continue to have 
        reading difficulties through high school. While older children 
        and adults can be taught to read, the time and expense of doing 
        so is enormous.
  --``We have learned that phonological awareness--the understanding 
        that words are made up of sound segments called phonemes--plays 
        a causal role in reading acquisition, and that it is a good 
        predictor because it is a foundational ability underlying basic 
        reading skills.
  --``We have learned how to measure phonological skills as early as 
        the beginning of kindergarten with tasks that take only 15 
        minutes to administer--and over the past decade we have refined 
        these tasks so that we can predict with 92 percent accuracy who 
        will have difficulties learning to read.
  --``The average cost of assessing each child during kindergarten or 
        first grade with the predictive measures is between $15 to $20 
        depending upon the skill level of the person conducting the 
        assessment. This includes the costs of the assessment 
        materials. If applied on a larger scale, these costs may be 
        further decreased.
  --``We have learned that just as many girls as boys have difficulties 
        learning to read. The conventional wisdom has been that many 
        more boys than girls have such difficulties. Now females should 
        have equal access to screening and intervention programs.
  --``We have begun to understand how genetics are involved in learning 
        to read, and this knowledge may ultimately contribute to our 
        prevention efforts through assessment of family reading 
        histories.
  --``We are entering very exciting frontiers in understanding how 
        early brain development can provide us a window on how reading 
        develops. Likewise, we are conducting studies to help us 
        understand how specific teaching methods change reading 
        behavior and how the brain changes as reading develops.
  --``Very importantly, we continue to find that teaching approaches 
        that specifically target the development of a combination of 
        phonological skills, phonics skills, and reading comprehension 
        skills in an integrated format are the most effective ways to 
        improve reading abilities.
    ``At the present time, we have held several meetings with officials 
from the USDOE and have discussed how these findings can be used across 
the two agencies. As an example of this collaboration, NICHD and USDOE 
have been developing a preliminary plan to determine which scientific 
findings are ready for immediate application in the classroom and how 
to best disseminate that information to the Nation's schools and 
teachers.''
    The excerpt from the Senate Committee report accompanying the 
fiscal year 1998 appropriations bill and addressing reading development 
and disorders is as follows.
    ``The Committee is impressed with the important accomplishments 
reported from the NICHD research program on reading development and 
disability, and is eager to have this information brought to the 
attention of educators, policymakers, and parents. Noting the fact that 
the NICHD is already collaborating with the Department of Education, 
the Committee urges the Director of the NICHD in consultation with the 
Secretary of Education, to convene a national panel to assess the 
status of research-based knowledge, including the effectiveness of 
various approaches to teaching children to read. The Committee 
recommends that the panel be comprised of 15 individuals, who are not 
officers or employees of the Federal Government and include leading 
scientists in reading research, representatives of colleges of 
education, reading teachers, educational administrators, and parents. 
Based on its findings, the panel should present a report to the 
Secretary of Health and Human Services, the Secretary of Education, and 
the appropriate congressional committees. The report should present the 
panel's conclusions, an indication of the readiness for application in 
the classroom of the results of this research, and, if appropriate, a 
strategy for rapidly disseminating this information to facilitate 
effective reading instruction in the schools. If found warranted, the 
panel should also recommend a plan for additional research regarding 
early reading development and instruction. The Committee looks forward 
to discussing the findings of the report during the hearing on the 
fiscal year 1999 budget.'' (Senate Report No. 105-58, p. 86).

                     research on reading disability

    Senator Cochran. Then I would ask Dr. Alexander for his 
response on the status of that initiative.
    Dr. Alexander. Senator Cochran, the research on reading 
disability and how children most effectively can be taught to 
read has continued to make excellent progress, both at the 
level of studying instructional methods as well as basic 
science studies of the brain processes involved in learning to 
read and blockages to that process.
    I am very happy to report to you that the national reading 
panel has been appointed. We had excellent cooperation and 
collaboration with the Department of Education in soliciting 
nominees for this panel and selecting them.
    We have put together a panel with outstanding expertise and 
diversity. The first meeting of that panel will be held on 
April 24 at the NIH, and we will be working very hard to try to 
complete the panelists' charge and get a report back to this 
committee by November.
    Senator Cochran. Thank you very much, and I commend you for 
your leadership and your rapid response to the initiative that 
we started last year.
    Thank you very much.
    Dr. Alexander. Thank you, Senator.
    Senator Cochran. Thank you, Mr. Chairman.
    Senator Specter. Thank you, Senator Cochran.
    Senator Bumpers.

                             Grant funding

    Senator Bumpers. Thank you, Mr. Chairman.
    Dr. Varmus, if you had all the money in the world and we 
were living in a perfect world, how many of those 24,221 
applications would you have approved?
    Dr. Varmus. That's a tough question, Senator, because, as 
you know, they are not of equal quality. Some of them are of 
extremely high quality. People who have had tremendous 
experience in reviewing such applications would say that 
perhaps 30 to 40 percent are of real obvious merit and below 
that it is a gradient. Where you cut off is somewhat arbitrary.
    It is important to distinguish, in my view, among three 
different kinds of applications. First are applications from 
first-time investigators, people who have never had a grant but 
have been trained, sometimes by NIH training programs. We would 
like to see them get at least one shot at showing what they can 
do as an independent investigator. Then there are applications 
which come from people who have already had support. They tend 
to do better than the newer applicants.
    Then there are people who have had previous support and are 
applying for another grant, as opposed to continuing a previous 
grant. You could argue that there is, perhaps, less imperative 
to have those people receive a second, third, or sometimes even 
a fourth grant.
    So I think it is important to disaggregate those numbers a 
little bit. But, overall, I would say that something in the 
range of between 30 and 40 percent of the total applications 
should be funded.

                     average length of Grant awards

    Senator Bumpers. Just quickly, what is the average length? 
Do you determine the length of the grant on the front end?
    Dr. Varmus. We do.
    Senator Bumpers. What is the average length?
    Dr. Varmus. The average length at present is roughly 4 
years.
    Senator Bumpers. And, of course, you allow justification 
for extension of that if, at the end of the 4 years, there is a 
justification for extending it?
    Dr. Varmus. Well, it is not a question of justification. 
One has to reapply. That is what I mean by a competitive 
renewal.
    Senator Bumpers. Yes.
    Dr. Varmus. Those applications tend to do about twice as 
well as applications for a new grant.

                   declining efficacy of Antibiotics

    Senator Bumpers. Dr. Varmus, I don't know whether it was 
Newsweek or Time magazine that had a big story this week on a 
continuing story that is moderately alarming, and that is about 
the declining efficacy of antibiotics in certain diseases.
    Do we tinker with what we have and try to strengthen it or 
do we look for new solutions in the case like that? What do we 
do?
    First of all, I assume that is correct.
    Dr. Varmus. Yes; we are having increasing problems. There 
is no doubt about that.
    Dr. Fauci, whose Institute addresses this problem every 
day, might want to comment. We do take this as a very serious 
problem. It is related to inappropriate use of antibiotics, to 
the fact that there are mechanisms of bacteria and viruses that 
allow for resistance to develop against antimicrobial agents 
like penicillin, that you are familiar with, and others.

                             cure for Ebola

    Senator Bumpers. Before we go to Dr. Fauci, as I am 
interested in his comments on that, do we do anything there? 
Are we doing any research in this country to speak of to find a 
cure for ebola?
    Dr. Varmus. We have some grant applications on ebola virus 
that are being funded by the NIAID. Whether there are any 
efforts being made to look for treatment or cure, I think it is 
important to point out, Senator, that traditionally we have had 
very few drugs for treatment of viral illnesses.
    One of the remarkable things about the way in which we have 
advanced on the AIDS front is that we have developed several 
powerful drugs to treat HIV infection. Those have served as 
models for how we might go about attacking other viral 
infections.
    Many other viruses make enzymes required for duplicating 
the viral genes, for making enzymes that chop up viral 
proteins, so-called proteases. HIV enzymes are now serving as 
models for how we go about approaching other viral infections, 
and those strategies are being considered in the context of 
many other viral infections, including ebola virus.
    Tony, do you want to comment here?
    Dr. Fauci. Yes; we have a handful of grants. One very fine 
investigator that we are supporting is looking at a vaccine for 
ebola.
    We have another grant or two looking at therapeutic 
approaches, which, as Dr. Varmus said, is very difficult. 
Viruses are one of the more problematic microbes to develop 
antimicrobial therapy for. But it is not a dead issue with 
regard to attempts to develop appropriate antimicrobials.

                         Antibiotic resistance

    I might mention in response to your previous question about 
how we are approaching antibiotic resistance, we consider that 
to be under an area of emphasis called emerging and reemerging 
microbes, which we placed a significant amount of effort on in 
the past couple of years, and particularly in the budget that 
we are defending here today. In emerging and reemerging 
microbes, one of the more important for our country is the 
development of microbes that are resistant to antibiotics. A 
particularly problematic area that we are facing now, where we 
actually moved some money in the middle of the fiscal year into 
the area is the recent occurrence, first in Japan and then in 
the United States, of vancomycin resistant staphylococcus 
aureus. This is a very substantial problem because vancomycin 
has been essentially the last firewall against staphylococcus 
aureus and we are seeing partial resistance now.
    We have a new antibiotic, synercid, which we believe will 
be the next line of drugs against this. But that is just one 
microbe.
    Approximately 70 percent of hospital acquired infections 
are, in fact, antibiotic resistant to at least one or more of 
the antibiotics. So it is a significant problem.
    But as I mentioned, we are addressing it in our initiative 
in this and previous years on emerging and reemerging microbes.
    Senator Bumpers. Do you think you are doing all you can do? 
Do you have all the money to do everything you can do?
    I see this as a really major, major health problem for the 
whole world.
    Dr. Fauci. As others have said, I don't think we could ever 
say that we are doing everything we could do. But I can assure 
you, Senator, that we have made this a major priority in the 
Institute.
    Senator Bumpers. Thank you, Dr. Fauci.
    Thank you, Mr. Chairman.
    Senator Specter. Thank you very much, Senator Bumpers.

      international collaborations on Infectious disease outbreaks

    Senator Faircloth.
    Senator Faircloth. Thank you, Mr. Chairman.
    Senator Bumpers, I could not help but think of that old 
joke that if Dr. Varmus had all the money in the world, he 
could farm for a couple of years. [Laughter.]
    Senator Bumpers. This is not the Agriculture Committee, 
Senator Faircloth. [Laughter.]
    Senator Faircloth. Dr. Varmus, we welcome you. I attended 
last week's rally to add my support for increased funding for 
NIH. As I said then, I will say again. If we could find $18 
billion for the IMF, we certainly can find the same amount of 
support to find a cure for the diseases that are ravaging this 
Nation and the world as a whole.
    This morning, I stood on the steps of the Capitol under a 
50-foot pink ribbon, and we spoke of the hope we have that we 
will find a cure for breast cancer. You are certainly at the 
helm of that ship that we hope will be bringing a cure quickly.
    Under your leadership and with the help of your Institute 
directors and many, many talented researchers, we are getting 
closer every day to the cure for cancer and many other dreaded 
diseases that have plagued generations and generations of 
people.
    As you know, I introduced legislation last year asking that 
an institute for biomedical imagery be established at the NIH. 
As Senator Frist and I work together to see what we can do to 
get more research done in this area, we are certainly 
appreciative of your support.
    Dr. Varmus, I have been deeply disturbed about your 
decision to discontinue the National Institutes of Health DNA 
Advisory Committee. Public objection has saved the committee, 
but you decided to relinquish their approval responsibilities 
to the FDA.
    The FDA can only grant approvals based on safety and 
efficiency. FDA cannot address the ethical and moral 
implications of the new gene therapies which the National 
Institutes of Health committee did address.
    I wish and would like for you to reconsider this decision 
as these new therapies deserve a more careful review than they 
are going to get from the FDA. I thank you.
    Mr. Chairman, I have one brief question, which I will 
direct to whomever may wish to answer.
    The Hong Kong flu outbreak last year demonstrated the need 
for global preparedness and the rapidity with which microbes 
and diseases can be spread around the world. We may and we will 
face future epidemics whose virulence could catch our existing 
public health networks unprepared.
    What are we doing in research and what are the 
opportunities that NIH has pursued internationally to reduce 
the risk of future outbreaks?
    I read something in a popular publication--I'm not sure 
what it was, though I believe it was Time--that the Asian flu, 
I believe it was, of World War I actually took several months 
to move from its beginning point somewhere in Kansas to the 
battlefields of Verdun. Of course, now it would go overnight.
    Dr. Varmus. This year's Hong Kong episode illustrates very 
nicely the way in which we try to respond to those threats and 
also illustrates very nicely an issue that Senator Cochran 
brought up about how we work with the CDC.
    Dr. Fauci, whose Institute was involved in that response, 
might want to comment briefly.
    Dr. Fauci. Yes, Senator. There was a Public Health Service/
DHHS flu pandemic plan that was put into effect immediately 
upon the identification of the first case in May 1997 and then 
the clusters in December. That was a plan that involved 
multiple agencies, both within and outside of HHS, and in HHS 
it was predominantly the Centers for Disease Control. You know 
from reading and seeing in the media the important role that 
they played there from a surveillance standpoint.
    The NIH role is fundamentally that of research, and we 
played a role with the CDC because, initially, the H5N1 that 
was isolated a couple of decades ago, was put in our 
repository. We, in fact, made antibodies to it, so that when 
the CDC needed antibodies immediately to make kits to do 
surveillance in Hong Kong, the surrounding areas, and in our 
own State and territorial health departments, the NIH made that 
available to them.
    The surveillance was done in collaboration with the CDC and 
this was effective.
    I might add that we were also able to supplement one of our 
grants. Dr. Varmus used his Director's reserve to move money 
over to immediately supplement one of our grantees who played a 
major role in the decision in Hong Kong to destroy the chickens 
which, as you know, essentially put an end to the epidemic 
there.
    Again, this is part of our emerging microbes effort and is 
continuing. It is also a major priority in this year's budget 
for us.
    Senator Faircloth. Thank you so much, Doctor.
    Thank you, Mr. Chairman.

                          Ergonomics research

    Senator Specter. Thank you very much, Senator Faircloth.
    We have kept you here a long time and we don't want to keep 
the progress of medical research in abeyance much longer. I do 
want to ask you one more question, Dr. Varmus, and that is with 
respect to the ergonomics issue. I know that you have already 
discussed this in detail with Bettilou Taylor, my clerk and 
very, very able staffer.
    Dr. Varmus. Yes; she is.
    Senator Specter. She has the sharpest pencil on Capitol 
Hill.
    Last year, Senator Harkin and I consolidated or eliminated 
134 programs in our subcommittee to save $1.5 billion for the 
$907 million. These programs were added to NIH and others to 
guaranteed student loans, because that is where we consider the 
priorities to be.
    Ms. Taylor had the conversation with you about the letter 
which was received from a number of Members of the House on 
this ergonomics issue. The letter had a line about ``Thank you 
for agreeing to fund the National Academy of Sciences 
comprehensive peer review of all available scientific 
literature examining the cause and effect relationship between 
repetitive tasks in the workplace and musculoskeletal 
disorders.'' The letter further states, ``Studies estimated the 
cost of $890,000 and it may take 24 months to complete.''
    I understand that you advised Ms. Taylor that you did not 
agree to that type of study and that you felt that the NIOSH 
report was quite good, but that maybe the solution would be 
simply to have a workshop to allow independent people to 
evaluate the quality of the NIOSH report and answer questions 
to see if there was any basis on how that study was carried 
out.
    The concern I have is we have prohibited any regulations on 
ergonomics for 1 year and the understanding was that would be 
the end of it. This has been a very contentious issue and we 
want to be free at the end of this fiscal year, September 30, 
to move ahead on this very important subject. If there can be 
some modest study, if one is needed, that will not go beyond 
the fiscal year. What is your thinking on the subject as of 
this date?
    Dr. Varmus. Senator Specter, we are continuing to have 
conversations with the academy about how such a study could be 
done. But, of course, I took careful notice of the letter you 
sent to me on February 4, in which you stated that you were 
going to have conversations with the Members of the House who 
have been corresponding with me. I look forward to hearing 
about the results of your conversations with them.
    I am open to suggestions. As Secretary Shalala said when 
she was here on March 10, I am basically in a holding pattern 
until I hear about how the two Appropriations Committees would 
like to try to reconcile their differences.
    In the meantime, we are trying to work with the academy on 
a kind of arrangement that would be a reasonable one and would 
do something expeditiously.
    Senator Specter. How long would that take?
    Dr. Varmus. We are not entirely clear yet. We have talked 
with them about bringing in some experts in this field who 
could give us some advice about how close we could come to 
providing either answers to Mr. Livingston's questions or their 
view about the extent to which we could answer the questions 
with existing knowledge.
    The House is not asking for additional research to be done. 
They are asking for further review of the literature beyond the 
review that was done by NIOSH.
    Senator Specter. That all can be accomplished before 
September 30?
    Dr. Varmus. I would think it could be, sir. I have made 
that view clear to the President of the academy Bruce Albert.
    Senator Specter. So there has been no agreement by you to 
conduct a study that might take 24 months at $890,000?
    Dr. Varmus. No.
    I have been very clear with my friends in the House that we 
are willing to entertain their request and we would like to do 
something, but we have not committed ourselves to a time or a 
cost.
    Senator Specter. OK.
    Dr. Varmus. I look forward to hearing from you about how we 
should proceed in this issue.
    Senator Specter. Well, we have not come to grips on that 
and my instinct is that we probably won't. I think the 
understanding we reached last year, which is that by September 
30 we are going to move ahead, is really the one we are going 
to be moving on. If there can be some relatively brief study, 
hopefully at a low cost, as you see fit, but not to delay us.
    We did not prohibit a study. We only prohibited 
regulations. We want to be free to act however the will of the 
Senate may be as of September 30. What you have just said is 
consistent with that.
    Dr. Varmus. As you know, I am in the middle here. But I 
would like to do things in good faith for both parties.
    Senator Specter. That is not an unusual position for you 
given your pay grade as Director of NIH. That is a big position 
and there is a big middle. [Laughter.]

   Prepared Statements of Senator Tom Harkin and Senator Larry Craig

    We have also received statements from Senators Harkin and 
Craig which will be inserted in the record at this point.
    [The statements follow:]

                Prepared Statement of Senator Tom Harkin

    I want to welcome Dr. Varmus and his colleagues from NIH 
today and I look forward to working with all of you during the 
appropriations process this year. NIH is the premier medical 
research institution in the world. The research funded by NIH 
is key to maintaining the quality of our health care and key to 
finding preventive measures, cures and the most cost effective 
treatments for the major illnesses and conditions that strike 
Americans.
    But I must say that I am concerned about how we're going to 
get the money to give NIH the increase that both Senator 
Specter and I would like to provide. Last year, the entire 
Senate went on record in support of doubling funding for 
biomedical research. But only a third of the Senate supported 
us when we tried to make good on that commitment by proposing 
an amendment to the budget resolution which increased funding 
in the health account to provide adequate funding for NIH and 
other health problems.
    This year we have the same thing happening again. The 
budget resolution now being debated on the Senate floor, is--to 
put it kindly--extremely short sighted when it comes to support 
for finding cures, more cost effective treatment and 
preventions for the many diseases and disabilities that hit 
millions of Americans every year.
    The sponsors of the budget resolution claim to have 
included $1.5 billion for an NIH increase. But that is just 
smoke and mirrors. The resolution partly funds the purported 
increase with cuts of $600 million in other public health 
programs--programs like community health centers and CDC 
prevention programs--cuts we cannot afford to make. The 
resolution also includes reductions in other functions 
affecting this subcommittee, including the pot of money for 
Head Start and Ryan White AIDS programs. Under the nondefense 
discretionary levels included in the budget resolution, we 
could not even do a continuing resolution at last year's level 
much less provide NIH with a significant increase.
    The budget resolution before us makes crystal clear that 
the only way--the only way--we can devote the resources we need 
to health research--and to stop robbing Peter to pay Paul--is 
by going outside the regular discretionary spending process. 
The only way to adequately support medical research is through 
another mechanism. I believe the best other mechanism is that 
called for in S. 441, the National Fund for Health Research 
Act, that Senator Specter and I have introduced.
    This year, we may have the opportunity to use proceeds from 
bipartisan, comprehensive tobacco legislation for medical 
research. In fact, increased funding for NIH is the one area 
about which tobacco bills introduced by Senators from both 
sides of the aisle agree. But the budget resolution does not 
allow us to do that. Senator Specter and I are working on an 
amendment to the budget resolution which will make those 
tobacco proceeds available for biomedical research. We ask your 
support for that amendment.
    The budget resolution, as now drafted, shortchanges 
Americans' health and shortchanges efforts to control health 
care costs and keep Medicare solvent in the long run.
                                ------                                


              Prepared Statement of Senator Larry E. Craig

    I would like to thank the Chairman for holding this hearing 
today regarding budget requests for the National Institutes of 
Health (NIH) for fiscal year 1999. I look forward to learning 
more about some of the scientific advances that have been made 
over the last year at the NIH, as well as the goals and long-
term projects planned for the coming year. Past 
accomplishments, as well as future plans should be taken into 
account as we look at ways to appropriately allocate funds to 
the various programs within the NIH.
    For the last several months, my staff and I have been 
hearing from various groups representing a broad range of 
diseases that get their research dollars through the NIH. The 
resounding message we hear from all of these groups is that 
their interests are not being adequately addressed in the way 
of funding. Each group has extremely valid reasons for wanting 
more funding and I find it difficult to pick and choose which 
disease should get more research money. Each disease is 
important and each one has far-reaching impacts on our country. 
I think it is crucial that we decide on what level of funding 
is appropriate and then distribute those funds with a sense of 
fairness.
    I applaud the NIH for the work they have done in developing 
new therapies and cures for diseases that will help resolve 
some of our country's greatest health problems. The long-term 
investments they have made in the areas of medical research and 
training will help to achieve many more new discoveries. 
Furthermore, sustained growth in funding for the NIH will help 
build upon past scientific achievement, address present medical 
needs and anticipate future health challenges.
    I do believe the NIH should be given funding adequate to 
support research that moves us toward cutting-edge treatments 
and prevention efforts, while helping to reduce overall health 
care costs. However, as we all know, there are harsh budget 
realities that we must work within and that is why we are here 
today. We must find a way to provide the appropriate level of 
funding for these programs while being fiscally responsible.
    I am strongly committed to fiscal responsibility. I also 
realize that the subcommittee is operating under significant 
budget constraints and will have to make difficult choices 
among competing programs. My hope is that the recommendations 
for NIH funding are made with the objective of searching for 
cost-effective solutions.
    We can make significant strides in the field of medical 
research while still working toward a balanced budget. 
Balancing the budget is all about setting priorities. If we 
discipline ourselves and set priorities now, while moving 
toward and keeping a balanced budget, that will be the best way 
to preserve our ability to fund our priorities in the future.
    I hope we will be able to shed some light on what these 
priorities must be as we continue to look for ways to 
adequately fund these very important programs, while working 
within our means. I look forward to hearing the testimony of 
all of our witnesses here today. Your expertise will be 
extremely valuable to me throughout this process.

                     Additional committee questions

    Senator Specter. This is a fascinating committee to chair 
because there are so many troubled people with ailments. We are 
almost at the 2 hour mark since we were convened here. So we 
are going to recess.
    I want to say that there are many questions that we are 
going to submit for the record and ask you about. People have 
come to this subcommittee to meet with problems on 
osteoporosis, colon cancer, Batten's disease, juvenile 
diabetes, drug abuse, scleroderma, breast cancer, amyotrophic 
lateral sclerosis, spinal cord injury, sudden infant death 
syndrome, polycystic kidney disease, end stage renal disease, 
schizophrenia, cystic fibrosis, lymphoma, lupus--just to 
mention a few. We are very much concerned about all of them, as 
I know you are.
    We will fight hard to get you additional funding because we 
think it is very much in the national interest to do so.
    Dr. Varmus. We are very grateful for your support, Senator. 
Thank you.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                     Additional Committee Questions
                            bipolar disorder
    Question. Last year's Senate Labor-HHS-Education Appropriations 
report called for an NIMH research plan on bipolar disorder. This 
request is a clear indication that, as you have acknowledged publicly, 
there is too little bipolar illness research being funded by NIMH. This 
appears to be the case, particularly in the area of clinical research. 
As you know, bipolar disorder is among the most disabling of mental 
illnesses. The Subcommittee understands that NIMH has taken some steps 
to increase bipolar disorder research funding. (a) Please describe what 
NIMH is doing as part of its current budget on manic-depressive illness 
research. How many new studies are being funded on this illness? What 
else, if anything, does NIMH intend to do to assure more research on 
bipolar disorder in fiscal year 1999 and beyond?
    Answer. NIH in general and NIMH, in particular, are committed to 
moving forward in research on bipolar disorder. Let me describe two 
major initiatives currently in progress for fiscal year 1998. First, in 
the NIMH Genetics Initiative, and as part of its effort to identify 
genetic factors in bipolar disorder, the Institute will continue to 
build up its national resource of DNA sample from patients and their 
family members. Second, we have issued a solicitation for a five year 
contract (``Treatment of Bipolar Disorder'') to launch a major public 
health study on ways to develop optimal treatment of bipolar disorder 
in adults and in geriatric populations. The study will assess the long-
term impact of different treatments on a broad range of clinical and 
functional outcomes. Data from this study will inform treatment 
practice in community settings. Other studies are examining treatments 
for adolescents with bipolar disorder. Furthermore, we intend to 
increase research on the neurobiological underpinnings of bipolar 
disorder as well as clinical, behavioral, and epidemiological work that 
will be useful in finding ways to prevent this disorder.
    At this time, it is not possible to predict how many studies on 
bipolar disorder will be funded in fiscal year 1999. This depends upon 
how many grant applications are submitted by independent investigators, 
and how scientifically sound and appropriate these applications are 
judged to be through the peer review process.
    As outlined above, NIMH intends to explore all avenues to increase 
research on bipolar disorder as rapidly as the growing fundamental 
science base allows scientifically rigorous research studies to be 
undertaken.
                         translational research
    Question. NIMH has frequently noted the need to support 
``translational'' research. However, for many policy-makers, patients 
and families, the definition of translational research remains unclear. 
Would you describe for the Subcommittee what you mean by translational 
research? How does NIMH intend to implement this kind of research and 
make relevant to the advance of severe mental illness treatment? What 
specific programs and policies does NIMH intend to put forward to 
advance translational research?
    Answer. The term, translational research, is meant to describe a 
type of scientific inquiry that crosses usual conceptual and 
disciplinary boundaries. Historically NIH's support of biomedical 
research has focused on two major categories: basic biology and 
clinical research. Translational research seeks to translate ``back and 
forth'' between these two largely separate domains. It is anticipated 
that this will result in accelerated scientific progress that is 
directly applicable to clinical disorders. It is important to note that 
this is viewed as a bi-directional process, i.e., clinical research 
informing, as well as being informed by, basic research and vice-versa. 
A couple of examples may clarify the concept. Developmental 
neurobiology and genetics are both highly relevant to mental disorders. 
In both instances, hypotheses in clinical research are shaped by 
observations in basic research and vice-versa. The cognitive deficits 
observed in schizophrenia coupled with structural anomalies in the 
brains of schizophrenics have encouraged developmental neurobiologists 
to investigate the possible role of aberrant brain development in the 
etiology of schizophrenia. Conversely, the identification of a growing 
number of genes required for the precise specification of brain 
structure during development has given rise to clinical studies focused 
on the anatomic substrates of abnormal mental function. It is my belief 
that fostering translational research will enrich both basic and 
clinical research and will speed progress toward a complete 
understanding of mental disorders.
    Implementation of this kind of research will require a continuing, 
close collaboration between basic and clinical mental health 
researchers. NIMH has begun to develop and strengthen such 
collaborations in research through specific research support 
mechanisms. For example, several recently published NIMH program 
announcements call for the development of four types of research 
centers focused on translational research. One type of center, the 
Silvio O. Conte Centers for the Neuroscience of Mental Disorders, will 
support the integration and translation of basic and clinical 
neuroscience research on severe mental illnesses, while other centers 
will focus on related research areas.
    Translational research requires collaboration between scientists 
from multiple disciplines, an approach which, historically, has not 
been emphasized in research on mental illnesses. NIMH stimulates and 
sustains activity in translational research on severe mental illnesses 
through career-development mechanisms, which provide support for young 
clinical investigators during the formative stages of their careers 
until they become fully independent researchers. In addition, small 
grant awards provide support for pilot projects and for first-time 
grants for young NIMH investigators. These awards can be used to 
explore translational and other research studies that would be 
difficult to fund under traditional support mechanisms. In addition, an 
NIH-wide RFA, Clinical Research Curriculum Award, is intended to 
stimulate the inclusion of high-quality, multidisciplinary didactic 
training as part of the career development of clinical investigators.
                          research priorities
    Question. There is concern among many that NIH in general, and the 
NIMH in particular, desire to invest less in disease-oriented and 
clinical research, and more in basic scientific research. Please 
describe for the Subcommittee what you think is the appropriate balance 
at NIMH between basic research funding and clinical and services 
research. Does NIMH intend to invest more in basic research? If so, how 
much more?
    Answer. Research on the causes, treatment, and prevention of mental 
illnesses is integral to the mission of the National Institute of 
Mental Health (NIMH); indeed, this research is the primary focus of all 
NIMH programs. Mental illnesses are diverse and, even though science is 
rapidly making enormous strides, very little is known about the causes 
of any of these illnesses. We do know that the key to these illnesses 
lies in basic research on the molecular and cellular changes in the 
brain and on understanding how the brain is changed by these diseases 
to produce the behavioral manifestations of these illnesses. This is 
the only way that we will ever understand how to most effectively 
treat, or to prevent, mental illnesses. NIMH basic research is directed 
toward understanding the changes in the brain and behavior that 
determine mental disorders.
    At the same time we must continue to apply what we already know to 
clinical studies and services for patients. Thus, support for clinical 
research and health services research by NIMH is also expanding. The 
NIMH assesses the balance between all these elements of its research 
endeavors and makes changes in emphasis as the scientific and clinical 
opportunities for studies warrant.
    In shaping its research program, NIMH periodically establishes 
research priorities, then continues to evaluate these priorities in the 
light of accumulating research-based knowledge. The appropriate balance 
between basic research funding and clinical and services research 
varies somewhat over time as advances in science create new 
opportunities to address specific research questions and to explore new 
avenues to treatment or prevention, or as marked changes in the mental 
health-care landscape--such as the advent of managed care--create new 
public mental health questions. NIMH relies on the National Advisory 
Mental Health Council (NAMHC), composed of both expert scientists and 
representatives of the public, to continually monitor the Institute's 
program balance and to assist in setting and reviewing research 
priorities. The NAMHC reviews and approves all research grants awarded, 
and, in addition, through special workgroups and task forces, the 
Council undertakes comprehensive, in-depth reviews of major segments of 
the NIMH research program and these reviews produce quite specific 
recommendations for program directions and emphasis.
    Based on recent recommendations by the National Advisory Mental 
Health Council and on emerging scientific opportunities, the NIMH 
intends to increase support for important areas of basic research as 
well as a broad spectrum of patient-oriented research--including 
clinical research, services research, and translational research that 
will accelerate the incorporation of basic research findings into 
clinical care. However, at this time, it is not possible to attach 
dollar amounts to these investments.
                             schizophrenia
    Question. Schizophrenia is the most severely disabling mental 
disorder and is among the most severe illnesses that afflict mankind. 
The statistics bear this point out; (a) schizophrenia strikes in young 
adulthood usually resulting in a lifetime of severe disability, (b) 
consumers with schizophrenia account for nearly 25 percent of all those 
receiving disability payments from the federal government, (c) 
schizophrenia costs the nation $32 billion each year, (d) consumers 
with schizophrenia occupy 40 percent of all hospital beds in the United 
States, (e) 10 to 15 percent of its victims commit suicide. While there 
has been important treatment advances in the 1990's, much has to be 
learned about this disease. We still do not understand what causes this 
illness, we have no diagnostic markers for schizophrenia, and 
treatments are but palliatives and not cures. By NIMH's own accounting, 
investment in schizophrenia research modestly declined in the first 
part of this decade--by approximately 10 percent. Given the severity of 
this illness and a record of decreasing research investment, what does 
NIMH plan to do to advance our understanding and treatment of 
schizophrenia? How much money is needed in this area of research? What 
are the most important barriers to research advances in schizophrenia, 
in your view? How can Congress assist you in conquering this terrible 
disease?
    Answer. Schizophrenia research continues to have a prominent place 
in NIMH programs. The Institute is committed to studies of the 
neurobiological substrates of schizophrenia, its neurodevelopmental 
origins, and the inheritance of and expression of vulnerability genes 
in the brain, as well as other factors that may trigger or exacerbate 
schizophrenia. For example, the NIMH Genetics Initiative has provided 
new funding to augment the number of patient samples available for 
gene-finding efforts in schizophrenia. Efforts are also underway to 
characterize exactly which of the Gamma aminobutyric acid (GABA) brain 
regions and which neurons are affected. There are preliminary data to 
suggest that small GABA interneurons, in particular, may be abnormally 
``connected'' in patients with schizophrenia, while there is a growing 
body of data pointing towards the involvement of specific emotional and 
higher cognitive centers of the brain. This localization is consistent 
with many of the behavioral manifestations of schizophrenia. 
Neurochemical theories of schizophrenia also continue to be studied, 
and there is growing evidence pointing toward the possible involvement 
of excitatory neurotransmission involving glutamate.
    While we do not yet have a cure for this devastating illness, in 
the past few years, three new, ``atypical'' antipsychotics have become 
available. These represent major therapeutic advances, since they are 
better-tolerated, and preliminary evidence suggests that they may be 
more effective than traditional antipsychotics. NIMH has initiated 
clinical studies to determine if these new treatments are indeed more 
effective, and if so, in which patient groups they are best used.
    Over the last 5 years NIMH has cofunded, with the Agency for Health 
Care Policy and Research (AHCPR), the Schizophrenia Patient Outcomes 
Research Team (PORT). The mission for this PORT was to identify and 
analyze the outcomes and costs of various treatments for schizophrenia; 
to determine the most cost-effective means to treat or manage the 
condition; and to develop and test methods for reducing inappropriate 
or unnecessary variations in treatment. The same investigative team was 
funded recently to conduct a field trial of a methodology for assessing 
the quality of care provided to patients with schizophrenia.
    The fiscal year 1999 President's Budget request will permit NIMH to 
take advantage of the most important immediate research opportunities.
    There are a number of reasons why progress in understanding 
schizophrenia and finding a cure has been slow. First and foremost, 
schizophrenia is a disease unique to humans. There is no animal or 
tissue model that accurately reflects the manifestations of the disease 
in man, and this necessarily limits the investigations that can be 
performed. Many of the powerful methods for studying molecular or 
cellular processes that have led to rapid advances in our understanding 
of other illnesses cannot be applied to schizophrenia, since they 
involve destruction or severe disruption of the tissues that are being 
studied.
    There are other barriers as well. Schizophrenia is difficult to 
treat and few people with the diagnosis--even those who respond well to 
treatments--return to their pre-illness level of functioning. Because 
of this, we need to go beyond therapeutic studies and start thinking 
about prevention. Yet we know little about factors that influence the 
course of this illness. The NIMH is developing research to aid in 
identifying indicators of risk for onset of disease, relapse, poor 
functional outcomes, and suicide. The programs will also translate 
emerging findings from the basic sciences into new strategies for 
prevention and early intervention. We are hopeful of substantial 
progress in the next decade. There is also a lack of understanding of 
how the newer atypical antipsychotics work. Their mechanism of action 
is very complex, affecting multiple brain transmitter systems. This 
complexity may be a critical feature of their greater efficacy, and 
will remain a central focus of research efforts in the near future.
    With the funds requested in the fiscal year 1999 President's Budget 
Request and the flexibility to use these funds in areas of greatest 
opportunity, NIMH will be able to accelerate research on schizophrenia.
                         supply of researchers
    Question. As I am sure that you will agree, there is a great need 
to attract new researchers and clinicians into psychiatry--in the areas 
of genetics and severe mental illnesses in children and adolescents in 
particular. Could you please comment on the problems you see in terms 
of the human resources available to study and treat these serious brain 
disorders? What do you intend to do to recruit new and talented 
individuals to these fields? How can Congress assist you in this 
activity?
    Answer. Several high-priority research areas such as the genetics 
of mental illnesses and childhood and adolescent mental illnesses are 
drawing on a very small cadre of investigators, many of whom have 
pioneered these fields. However, as these areas of research develop and 
expand, progress depends on the availability of more well-trained 
investigators. The National Institute of Mental Health (NIMH) will 
develop strategies to attract more researchers into these critical 
areas. For example, in the area of pediatric mental illness, most 
researchers are drawn from the small groups of clinically trained child 
psychiatrists and child psychologists. Given the length of clinical 
training, many potential investigators are diverted (often for 
financial reasons) into non-research careers. However, while there are 
only 5,000 child psychiatrists nationwide, there are over 100,000 
pediatricians, adult psychiatrists, and neurologists, from whose ranks 
new child mental health-focused investigators could be drawn.
    NIMH anticipates two major activities in this area. (1) The 
Institute will issue a new career award to attract researchers such as 
neurologists, adult psychiatrists, and psychologists, who have not 
typically studied in this age group to encourage them to learn about 
how to do clinical studies of children and adolescents and to redirect 
their efforts. A similar strategy will be employed for other shortage, 
high priority research areas. (2) NIMH will develop supplements to 
existing research grants for young investigators who are interested in 
studying childhood psychopathology or other similar high priority 
areas.
    The fiscal year 1999 President's Budget Request was developed after 
lengthy examination and discussion of scientific opportunities and 
research needs, and NIMH feels that this level of funding will provide 
good support for strengthening the recruitment of researchers into 
critical areas of study.
                              tuberculosis
    Question. How does the morbidity and mortality due to tuberculosis 
compare with the disease burden for other infectious diseases? What is 
the impact of TB on economic development?
    Answer. Tuberculosis (TB) kills approximately 3 million people each 
year, making it the leading cause of death due to a single infectious 
agent globally. In comparison, all acute lower respiratory infections 
combined were responsible for 3.9 million, malaria for 1.5-2.7 million, 
and HIV/AIDS for approximately 1.5 million deaths in 1996. TB accounts 
for more than one quarter of all preventable adult deaths in developing 
countries. One-third of the world's population is infected with the TB 
bacillus, and someone in the world is newly infected by TB every 
second. In the United States there were 19,855 cases of tuberculosis 
reported in 1997. The World Health Organization estimates that between 
now and the year 2020, nearly one billion more people will be newly 
infected with Mycobacterium tuberculosis, the bacterium that causes TB, 
200 million will develop active disease, and 70 million will die. 
Causing even greater concern, is the estimate that up to 50 million 
people may already be infected with drug resistant strains of 
tuberculosis.
    According to a recent study from the Battelle Centers for Public 
Health Research and Evaluation, published in the Archives of Internal 
Medicine, the United States spends an estimated $700 million per year 
on TB treatment and control. The impact of tuberculosis on economic 
development is particularly dramatic because most often affects 
individuals during their wage-earning years. A report recently issued 
by the WHO estimates that, if India, which has 2 million new cases of 
TB annually, spent the equivalent of $200 million per year on an 
effective TB control strategy, the tangible benefits to the Indian 
economy would be worth at least $750 million per year. In addition, if 
this epidemic is not adequately controlled, greater spread of multi-
drug resistant TB will result, potentially creating a far more serious 
impact on global health and economics. In the United States, it costs 
approximately $2,000 to treat a typical case of drug sensitive 
tuberculosis, while treating a case of multi-drug resistant TB costs up 
to $250,000.
    Question. In the long-term, what is the best way to control and 
prevent tuberculosis and multi-drug resistant tuberculosis?
    Answer. In the long run, the most effective tool for preventing 
tuberculosis would be a TB vaccine. Controlling TB will also depend on 
the development of new and improved diagnostic and therapeutic tools--
including therapies that would shorten and simplify the course of 
treatment, drugs active against currently resistant bacteria, and more 
sensitive and specific diagnostic methods suitable to low income as 
well as industrialized countries. NIH is actively supporting research 
in all these areas.
    The most effective current tool available for controlling 
tuberculosis is a strategy known as Directly Observed Treatment, Short-
course or DOTS. Antibiotics can effectively cure drug-sensitive cases 
of tuberculosis and reduce development of additional drug resistant 
cases, but the treatment requires that patients take combinations of at 
least four antibiotics daily for a minimum of six months. DOTS ensures 
that patients comply with this difficult regimen by having health care 
workers observe patients swallowing every dose of their medications. 
Using a similar approach, the CDC along with state and local health 
authorities have made enormous headway since 1992 in controlling TB in 
the United States. In this same time period, the WHO Global 
Tuberculosis Programme has been focusing considerable resources to 
control the global epidemic by implementing DOTS as widely as possible. 
Despite these admirable efforts, only about 10 percent of patients 
worldwide with active TB disease currently have access to DOTS 
programs. The effectiveness of this resource-intensive control strategy 
is limited in many parts of the world by financial, logistical and 
political obstacles. Efforts to implement DOTS more widely are crucial 
to control this disease. However, it is estimated that even with a 
sustained global DOTS program, as many as 70 million people will die of 
TB in the next two to three decades.
    Question. How big a priority is tuberculosis research at NIAID? How 
actively is NIAID trying to develop a TB vaccine? When can we hope to 
have an effective tuberculosis vaccine?
    Answer. Tuberculosis research is a very high priority at NIAID. The 
TB research budget increased 1,311 percent from 1990-1999. NIAID 
supports a broad-based program of research on TB and its causative 
agent, Mycobacterium tuberculosis, consisting of basic and applied 
studies to better understand the biology, pathogenesis and immunology 
of TB, develop new tools for molecular epidemiologic studies, improve 
diagnostic and treatment strategies and advance more effective 
vaccines. Currently, NIAID supports more than 100 grants for basic and 
applied TB research. One grant is to the Institute for Genomic Research 
(Rockville, Maryland) to support the sequencing of the entire genome of 
a recent, clinical isolate of virulent M. tuberculosis. Progress has 
been rapid in the past year and sequencing is near completion. This 
will have significant implications for the development of future TB 
diagnostics, therapeutics and vaccines.
    Development of a TB vaccine is a critical part of NIAID's overall 
TB research strategy, and it is our most important long-range goal. An 
effective TB vaccine is necessary to conquer the global epidemic, but 
to achieve this goal a number of years of testing will be needed. 
Recent technological advances such as sequencing the genome of the 
pathogen provide a solid foundation for the additional steps that must 
be taken. These include further basic research into the genetic make-up 
of the pathogen and the human protective immune response; development 
of vaccine candidates and animal models, and conduct of clinical trials 
with promising candidates. Once trials are completed, efforts will 
focus on vaccine production, licensure, and distribution. With a 
sustained effort and commitment, an effective TB vaccine can be 
achieved.
    Question. How does funding for tuberculosis research at NIAID 
compare with funding for research on HIV and other infectious diseases?
    Answer. Research on tuberculosis continues to be a high priority at 
NIAID. In fact, spending increases for TB research have outpaced both 
those for AIDS research and for the Institute's spending on all non-
AIDS infectious diseases. Over the past decade, NIAID support for 
tuberculosis research increased 1,311 percent. In fiscal year 1990, 
NIAID provided $2.7 million in funding for tuberculosis research, and 
in fiscal year 1999, we estimate that support will be approximately 
$35.7 million. In comparison, support for AIDS research for the same 
period at NIAID increased 94 percent, from $394 million in fiscal year 
1990 to $766.2 million in fiscal year 1999. Likewise, funding for all 
non-AIDS infectious diseases increased 70 percent, from $241.6 million 
in fiscal year 1990, to $411.9 million in fiscal year 1999.
    Question. Dr. Barry Bloom is chairing a committee that will be 
reporting back to Secretary Shalala with recommendations on 
tuberculosis vaccine development. How do you intend to make use of 
these recommendations?
    Answer. In March 1996, senior staff in the Office of the Secretary 
met with the Secretary's Advisory Council on the Elimination of 
Tuberculosis (ACET). During the meeting, the Council emphasized the 
importance of a national effort to develop an effective TB vaccine to 
meet the United State's goal of TB elimination. The Secretary's Office 
responded by requesting creation of a national strategy for TB vaccine 
development for her consideration. Subsequently, the ACET and the 
National Vaccine Program Office asked NIAID to convene a workshop to 
develop this strategy, since NIAID routinely assembles outside experts 
to provide recommendations and strategies for future efforts. At 
NIAID's request, Dr. Barry Bloom chaired the resultant workshop, A 
``Blueprint for TB Vaccine Development,'' held March 5-6, 1998. A 
report from that meeting is currently being prepared for Secretary 
Shalala's consideration. NIAID believes TB vaccine development is an 
important area of current and future research and looks forward to 
receiving Secretary Shalala's response to its report.
    Question. What tuberculosis research is being done outside of NIH, 
both in the U.S. and globally?
    Answer. Both within the United States and globally, the majority of 
public sector and academic TB research is funded by the NIH; however, 
other significant efforts in U.S. TB research include those being 
pursued by the Centers for Disease Control and Prevention (CDC), 
focused largely on improving control and surveillance of tuberculosis, 
and by industry. Only a handful of large pharmaceutical companies 
appear to have major TB research programs focused on drug development 
or, in even fewer companies, vaccine development. Several biotechnology 
companies are also involved in R&D of improved TB diagnostics, 
therapies or vaccines. Unfortunately, many companies have decided not 
to pursue TB research because of financial and intellectual property 
issues that make identifying an ``adequate'' global market difficult.
    In 1995, the WHO Global TB Programme attempted to ascertain the 
funding level of global TB research. The 13 institutions that responded 
to the survey (none of which were from private industry) spent a total 
of $92 million, approximately $62 million of which was NIH funding 
(approximately $34 million from NIAID). The remaining four highest 
funders were the U.S. CDC ($17 million), the Medical Research Council 
of South Africa ($3.6 million), the Medical Research Council of the 
United Kingdom ($2.4 million) and the Robert Wood Johnson Foundation in 
the U.S. ($1.65 million).
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
                     iom study on clinical research
    Question. As you know, I am a cosponsor of the Clinical Research 
Enhancement Act based on the recommendations of a 1994 report of the 
Institute of Medicine. Over the past three years, this Subcommittee has 
raised serious concerns about the major obstacles confronting clinical 
research through which our investment in NJ-U's basic research efforts 
pays off with better patient care. Other than responding with modest 
intramural initiatives, you have asked that we await a report from your 
advisory panel on clinical research. Recently, that panel issued its 
report and, not surprisingly made recommendations almost identical to 
those of the IOM.
    Dr. Varmus, why did the NIH not proceed with these initiatives 
three years ago when they were recommended by the IOM?
    Answer. As you stated, the ground work examining the state of our 
nation's clinical research enterprise was conducted by the Institute of 
Medicine (IOM). This study, which was carried out from 1991-1994 and 
was partially funded by NIH, addressed a number of the important issues 
concerning clinical research, including its role of clinical research 
in the delivery of health care, the status of the clinical research 
infrastructure, and the need for well-trained clinical investigators. 
Although the 1994 IOM report was thorough and addressed a range of 
relevant issues its recommendations were very broad and were aimed at 
both the private and public sector entities that sponsor, conduct, or, 
in some way, play a role in clinical research. These include the 
accreditation and certification organizations, professional societies, 
universities, academic medical centers, industry, and the Federal 
Government.
    Because NIH is but one of these entities and has a unique role, I 
responded to the 1995 Appropriations Committee report language that 
requested NIH to act on the recommendations of the IOM report by 
convening the NIH Clinical Research Panel (CRP). That panel was charged 
with examining specifically the role of NIH in ensuring the health of 
the Nation's clinical research infrastructure. To this end, the CRP was 
asked to examine several important areas of NIH-supported clinical 
research including, but not limited to, the General Clinical Research 
Centers (GCRC's), the NIH Clinical Center (CC), the recruitment and 
training of future clinical researchers by NIH, the conduct of NIH-
sponsored clinical trials, and peer review of clinical research 
supported by NIH.
    The CRP was also asked to deliberate on a number of issues that 
were not prominent concerns at the time of the IOM study, but reflect 
the rapidly changing clinical research environment today. These include 
the expansion of managed care, the emphasis on training primary care 
physicians, and the extensive transformation of the academic health 
care infrastructure.
    By the time the CRP report was completed in December 1997, a number 
of the panel's recommendations were already being implemented. The 
complete report is available on-line at http://www.nih.gov/news/crp/
97report/index.htm.
    Question. And, what do you plan to do immediately to rectify this 
situation and make up for lost time?
    Answer. NIH was implementing the recommendations of the Clinical 
Research Panel as they were brought forward. For example, the 
recommendation to track that part of the NIH budget devoted to clinical 
research was implemented by the creation of a prospective system to 
monitor the grants and other awarded funds which are devoted to 
clinical research. The recommendation to create a Clinical Research 
Training Program was implemented immediately. The creation of the new 
programs of career enhancing awards for clinical researchers continues 
this pattern.
    Question. It is my understanding that the number of first-time 
physician applicants for research projects grants declined by 30 
percent between 1994 and 1996? At that rate, we will have no new 
physician applicants by the year 2000.
    Answer. We have noticed a reduction in the number of new physician 
applicants for NIH research grant support between 1994 and 1997. In 
1997, the NIH received 1,769 applications from individuals with the 
M.D. degree who had never received NIH research project grant support. 
This number is approximately the same as observed in 1996 and is 22 
percent below the peak observed in fiscal 1994.
    To address this important issue, the NIH has recently announced new 
career award mechanisms designed to offer at least 80 young physicians 
new training opportunities in clinical research each year. This same 
initiative will also increase opportunities for mid-career clinical 
researchers who will serve as mentors. In addition, the initiative will 
support the development of high-quality instruction in clinical 
research methodology. We are hopeful that these new awards will 
ultimately increase the number of physicians submitting applications 
for clinical research grants. To provide some indication of the 
magnitude of this initiative, we estimate that, if all of the entry 
level awards supported by this program apply for research project 
grants after completing their career awards, there will be a greater 
than 10 percent increase in applications from physicians each year for 
several years into the future.
    The NIH has also requested an increase in NRSA stipends designed to 
improve the attractiveness of NIH training opportunities. We hope this 
change will reverse recent reductions in the number of young clinicians 
engaged in postdoctoral research training. To attract bright young 
clinicians into NIH research careers, I believe that the NIH must 
modify its training and career award programs to accommodate changing 
revenue streams within the academic health center. We will continue to 
monitor application rates from clinicians in the future.
    Question. First, can you tell us whether this trend continued in 
1997, and are you not alarmed by this stunning decline?
    Answer. As I have described, the number of new physician applicants 
has declined slightly and we are taking measures to encourage 
additional applications in the clinical area. However, our concern over 
this decline is mitigated by the fact that when we look at overall 
awards made to all those holding MD degrees, including both first-time 
applicants and those who have previously held NIH awards, there has 
actually been an increase. In fiscal year 1994 the NIH made more than 
1,700 awards for new and competing projects to MD's, and this number 
has gradually but steadily increased to more than 2,000 in fiscal year 
1997.
                                 ______
                                 
           Questions Submitted by Senator Christopher S. Bond
                    polycystic kidney disease [pkd]
    Question. I understand that there have been a number of recent 
breakthroughs in Polycystic Kidney Disease, leading many knowledgeable 
scientists to believe that effective therapies might be available for 
PKD patients in the near term. Is this true?
    Answer. In the last two years, dramatic progress has been made in 
understanding the cause of PKD. The genes that are mutated in the two 
commonest forms of PKD (PKD1 and PKD2) have been cloned and sequenced 
and the protein structures deduced. We are beginning to understand the 
possible function of this protein, called polycystin, which is 
defective in patients with PKD1. This exciting finding may offer new 
insights into the mechanisms which cause renal cysts to form and grow, 
and is providing possible strategies by which to interfere with cyst 
growth. There is reason for optimism that this may lead to treatments 
which prevent progressive renal failure in patients with these 
diseases.
    Question. If so, why has the PKD portfolio at NIDDK been reduced 
substantially in the last two years to a surprisingly small $5.2 
million projected for this year?
    Answer. While it is true that NIDDK funding for PKD research dipped 
in fiscal year 1997, overall the program has grown consistently and 
substantially over the past decade. This growth has occurred because of 
the scientific opportunities including the discovery referred to above.
    From its start at about $1.5 million in fiscal year 1988, NIDDK 
funding for PKD research will reach an estimated $7.5 million in fiscal 
year 1998. About $5.2 million is for continuing noncompeting projects 
and the remaining $2.3 million is for new and competing renewal awards 
that have already been funded or that we anticipate funding. The fiscal 
year 1998 amount is a 19 percent increase over the fiscal year 1997 
total of $6.3 million and represents a return to the peak funding for 
PKD research, which was $7.5 million in fiscal year 1996.
    Question. The Appropriations Committees of both the House and 
Senate have recommended increased funding for PKD research for the past 
6 years. How do you account for the very modest $5.2 million projected 
for this research in the present year?
    Answer. As stated above, NIDDK funding for PKD research will reach 
an estimated $7.5 million in fiscal year 1998. The $5.2 million of the 
fiscal year 1998 is for continuing noncompeting projects and the 
remaining $2.3 million is for new and competing renewal awards that 
have already been funded or that we anticipate funding.
    Question. Is the NIH ignoring the concerns of the Senate and House?
    Answer. The NIH is, by no means, ignoring the concerns of the House 
and Senate. To capitalize on discoveries and encourage increased 
research on PKD, NIDDK has sponsored successful scientific meetings and 
solicitations for grant applications. Meetings held in 1995, 1996, and 
1997 allowed researchers to benefit from the presentations and comments 
of peers, fostered collaborations and helped formulate subsequent NIH 
research solicitations. Since 1985 the NIDDK has issued six Requests 
for Applications and Program Announcements (PA) to increase interest in 
PKD research. The most recent was a PA with a $2.5 million targeted 
funding level.
    Question. A number of the top administrators and scientists at the 
NIH have recently argued that PKD research is the hottest thing going 
on in kidney research. Some have characterized it as the most promising 
area in all of biomedical research. What kind of priority setting is 
going on at the NIH when the PKD research portfolio has been reduced by 
30 percent in the past two years?
    Answer. The statement that the PKD research portfolio has been 
reduced by 30 percent in the past two years is inaccurate. The 
estimated fiscal year 1998 funding amount for PKD research represents a 
19 percent increase over fiscal year 1997. The NIH has a solid 
commitment to PKD research and we are optimistic about the future of 
NIH-funded research on PKD.
    The NIH and the Polycystic Kidney Research Foundation have been 
involved in planning a new initiative for fiscal year 1999 to develop 
better methods to assess progression of PKD using state-of-the-art 
radiographic imaging techniques. This study should provide the needed 
tools to measure treatment outcomes in future trials. Also relevant to 
process in learning more about PKD is a new initiative to identify 
genetic loci and genes that either protect people from or predispose 
them to progressive kidney failure, the so-called nephropathy 
susceptibility gene initiative. As you know, many people at risk for 
renal disease, including some PKD-gene carriers, do not develop renal 
disease, while others progressively lose kidney function. It is 
expected that these studies will help to explain this phenomenon.
                            priority setting
    Question. We have all witnessed a significant increase in the NIH's 
budget over the past few years. I am concerned about how the NIH sets 
priorities. What are the primary factors utilized at the NIH for 
setting these priorities for research?
    Answer. The principles and mechanisms that guide the NIH in the 
continuous activity of managing its budget are comprehensively 
discussed in a recent NIH document, ``Setting Research Priorities at 
the National Institutes of Health.'' The basic theme of the priority 
setting booklet is that the NIH builds its budget by evaluating current 
scientific opportunities and public health needs while maintaining 
strong support for investigator-initiated research. A copy of this 
document is attached for your information.
 Attachment--Setting Research Priorities at the National Institutes of 
                                 Health
                                overview
    Given the importance of medical research in fighting disease and 
improving the nation's health, the enormous range of possible subjects 
of research, and the thousands of talented investigators who seek 
funding, the National Institutes of Health (NIH) must make choices 
about where and how it spends its money, approximately $13 billion in 
fiscal year 1997.
    The process of choosing is routinely called setting priorities, a 
phrase that is shorthand for an elaborate application of principles and 
mechanisms the NIH uses for evaluation and judgment. Making choices is 
complex and often difficult: the NIH's mission and its history 
demonstrate that no one thing--no single disease, no single 
investigator, no single Institute, no single method of funding 
research--comes first or claims permanent priority over others. The 
principles and mechanisms that guide the NIH in the continuous activity 
of managing its budget are the subject of this booklet. Some 
observations about the influences and facts that condition the process 
may add clarity. It is important, however, to keep in mind that this 
booklet describes the ways things work at the NIH now; it is neither a 
justification nor a defense of a system that has succeeded, but which 
also is imperfect.
Managing the NIH's budget requires many decisions
    There are 21 Institutes and Centers (called Institutes for 
convenience) within the NIH. By law each must be funded and each is 
committed to certain domains of medical science (e.g., cancer, heart 
disease, aging, mental health). Their existence sets rough limits on 
both the current budget and future budgets.
    The appropriations process, from the President's request through 
final passage of the bill by the Congress, obligates each Institute to 
determine how to allocate its own funds among many different activities 
of science--including investigator-initiated grants, the intramural 
research program, and research training, among others. These decisions 
are tailored to the Institute's research objectives.
    Each Institute also decides which specific research grant 
applications to fund among those proposed by researchers working at 
universities or other research centers and whether to emphasize certain 
research topics within its domain.
    The net effect of these decisions determines how much of the entire 
NIH budget is devoted to work in certain scientific disciplines (e.g., 
neurosciences, microbiology, genetics) or on certain diseases.
    It is also important to note that past decisions--from the creation 
of an Institute to the establishment of research centers to the 
awarding of grants to individual investigators (averaging four years)--
have longer lives than the annual appropriations. This leaves only a 
part of the entire budget available each year for new opportunities.
Assessing research according to money spent on specific diseases is 
        imprecise
    Public and congressional inquiries about how the NIH spends its 
money often focus on the amounts given to certain Institutes or devoted 
to research on a specific disease.
  --Research on any disease is not confined to one Institute, and no 
        Institute is dedicated to a single disease. An Institute's 
        budget is an inadequate measure of support for research on 
        specific diseases. Research into many diseases is often carried 
        on in several Institutes simultaneously, e.g., several 
        Institutes are supporting research on Alzheimer's disease.
  --It is also extremely difficult to assign the large investments in 
        basic research to any one disease. For example, the number of 
        grants specifically devoted to heart attacks is smaller than 
        the number of grants awarded for research on cardiac muscle 
        biology and lipid metabolism, which have obvious and promising 
        implications for understanding, preventing, and treating heart 
        attacks.
  --From long experience, we know that research aimed at one target 
        often hits another, e.g., a gene causing breast cancer in mice 
        plays a role in the development of brain tissue. It is 
        impossible to attribute research and discoveries like this to 
        one disease.
    There is, consequently, no ``right'' amount of money, percentage of 
the budget, or number of projects for any disease.
There are limits to planning science
    Science, dealing with the unknown, is inherently unpredictable (see 
``How Science Works'' later in this booklet). Moreover, unforeseen 
crises and opportunities may require the NIH and individual scientists 
to abandon their plans or change the direction and focus of their 
research. Consider two examples:
  --The emergence of new diseases (AIDS or Ebola), the rise of 
        importance of others as our society changes (Alzheimer's 
        disease), and the resurgence of old ones (tuberculosis) all 
        require urgent attention. The expense of supporting new and 
        unforeseen research, however, does not displace the need to 
        continue investigations into heart disease, muscular dystrophy, 
        arthritis, or diabetes.
  --Unplanned and untargeted basic research on DNA in the 1960's and 
        1970's permanently changed the way medical research is done. 
        These studies furnished the ground for the biotechnology 
        industry that provides important therapeutic products, which we 
        would otherwise not have, and set the stage for the Human 
        Genome Project that has revolutionized our approach to 
        virtually all disease.
    Consequently, slightly over half, on average, of each Institute's 
budget supports the best research grant proposals regardless of 
specific applicability to prevention and treatment of a disease, but in 
expectation that their results will contribute to advances against 
diseases within their purview as well as diseases in other Institutes 
and to our knowledge generally.
    It is also true, however, that a decision to increase support of 
one area of medical science--by design, according to a directive, or in 
response to a critical opportunity--now usually comes at the expense of 
something else and affects the planning of future research.
    Decisions to create new Institutes or to expand research into 
specific diseases were historically accompanied by very large increases 
in the NIH budget. No programs had to be cut or attenuated. This is no 
longer the case. Consequently, directives to spend more on a specific 
disease or the need to respond to swiftly emerging threats (e.g., 
Ebola) constrain spending on other diseases or on fundamental research.
Various criteria shape the NIH's budget
    Some general criteria, which condition the allocation of resources, 
are both influential and continuous.
  --The NIH has an obligation to respond to public health needs, as 
        judged by the incidence, severity, and cost of specific 
        disorders. Calculating these needs is difficult, and there is 
        not always a clear correlation between expense and results.
  --The NIH applies stringent review for scientific quality on all 
        research proposals in order to return the maximum possible on 
        the public's investment in medical research.
  --As an administrator of science, the NIH has learned that many 
        significant advances occur when new findings, often unforeseen, 
        expand experimental possibilities and open new pathways for the 
        imagination. Not all problems are equally approachable, no 
        matter their importance to public health. Pursuit of a rare 
        disease may often have unexpected benefits for more common 
        problems. By the same token, increased spending on a disease is 
        wasteful when there are neither promising pathways to follow 
        nor an adequate number of qualified investigators to fund.
  --The NIH's portfolio must be large and diverse. Because we cannot 
        predict discoveries or anticipate the opportunities fresh 
        discoveries will produce, the NIH must support research along a 
        broad--in fact, expanding--frontier.
  --The NIH must continue to support the human capital and material 
        assets of science. To this end, the NIH's budget supports 
        research training, acquisition of equipment and instruments, 
        some limited construction projects, and grantee institutions' 
        costs of enabling the research programs.
To develop its research programs, the NIH seeks advice from many 
        sources
    The complexity of both planning budgets and spending money are 
apparent. With no claim to a monopoly on good ideas, the NIH seeks 
opinions and counsel from many quarters:
  --The extramural scientific community, including both individual 
        researchers and professional societies.
  --Patient organizations and voluntary health associations which may 
        deal directly with the NIH or indirectly through Congress and 
        the public media.
  --The Congress and the Administration.
  --The NIH staff.
    How the NIH solicits and acquires opinion and advice is detailed in 
``The Institutes'' and ``The Role of the NIH Director,'' the last two 
sections of this booklet. Some examples include:
  --Review groups of accomplished investigators evaluate grant 
        applications for merit.
  --Each Institute convenes national advisory councils to review 
        policy, with members from the public and from the medical and 
        scientific communities.
  --Every year, the NIH holds conferences and workshops to gather 
        opinions and ideas on specific scientific, health, ethical, and 
        administrative questions. For example, a Parkinson's workshop 
        recently brought together clinicians and geneticists who 
        together identified a chromosomal locus (and more recently the 
        gene) that predisposes to the familial form of the disease. 
        Their findings will also attract new investigators and could 
        lay the groundwork for advances against the more common (non-
        familial) form of the disease.
  --The NIH uses advisory groups of outside experts to assess trans-NIH 
        activities (e.g., the reviews of the NIH intramural research 
        program and AIDS research program) and to recommend budgetary 
        and programmatic improvements.
  --In addition to consultations with the Congress, patient 
        organizations, and the Administration, Institute directors and 
        staff seek opinions from other Federal agencies for both 
        budgetary and programmatic insight, e.g., OMB and DHHS.
    The final responsibilities for the complex and imperfect process of 
evaluating opinion, assembling the individual Institutes' portfolios, 
and determining expenditures remain with the NIH Director and the 
directors of the Institutes.
Evaluating opportunities and public health needs is complex
    The NIH builds its budget by evaluating current opportunities and 
public health needs while maintaining strong support for investigator-
initiated research. The NIH's requests for increases in funding for 
specific Institutes are based on proposals that: Exploit new 
discoveries, such as the isolation of new genes for human disease; 
encourage study of diseases that are only now able to be understood 
because of recent new discoveries; and strengthen technologies 
applicable to many disciplines and diseases, e.g., computer science, 
imaging, or gene mapping.
    The emphasis the NIH places on funding unsolicited proposals from 
investigators from individual laboratories (investigator-initiated 
research) does not dismiss the efforts of advocates of disease-oriented 
research or propose they should not do more to advance their causes. 
Nor does the emphasis erect a wall between basic research and clinical 
research. The Parkinson's disease workshop mentioned above and others 
on autism, spinal cord injury, and diabetes mellitus have proved how 
profitable such collaboration can be.
    It is also a responsibility of scientists to explain science and 
scientific progress to the public. Medical science is slow and 
difficult; its advances do not occur at equal rates on all fronts; the 
long-term relevance of basic science to treating human disease may be 
hard to see; scientists may be inexpert in explaining the connection 
between their work and the nation's health. The many criteria, 
standards, and influences that all operate simultaneously on the NIH 
are of themselves complex. There is, however, another component: 
science is not like other businesses. To explain this proposition, the 
next section expands on some ideas already here and presents some new 
ones.
                           how science works
    Although the word ``science'' comes from the Latin scientia meaning 
``known things,'' scientists and the practice of science exist because 
of what we do not know. The aim of science is to move what we do not 
know into the realm of known things and then, with a greater store of 
knowledge, begin again, as if advancing a frontier. This basic truth 
about science makes it different from other enterprises. Many 
industries normally manage their resources, labor, and money to produce 
the same or similar products over and over. Science deploys its 
resources and talents to explore new areas and produce fresh results, 
which are not endlessly replicated, but which prepare the way for 
future and different explorations.
    The many disciplines of medical research contribute to our store of 
knowledge and to one another, and all deserve exploration and funding. 
Discoveries that will increase our knowledge of the causes, 
progression, and treatment of asthma, for example, may stem from 
epidemiological, clinical, and molecular research, conducted by teams 
of investigators building on the discoveries of their predecessors, 
including those in other fields.
    Since it is impossible to know with certainty which area will 
produce the next important discovery, the community of science, of 
which the NIH is a part, has to be open to all ideas. No one field has 
all the answers, but investigators in many different fields can ask the 
questions that will provide more knowledge about disease and health.
    The uncertainty of where the most valuable discovery lies makes the 
setting of priorities tremendously difficult. But this uncertainty also 
fosters a creative and collaborative tension within the scientific 
community (and among the various Institutes at the NIH) which in turn 
imposes the discipline of evaluation, competition, and productivity on 
the choices we make about spending public money.
    To approach it differently, science and the management of science 
are neither chaotic nor navigation by dead reckoning. Given the NIH's 
internal rigor and the legitimate interests of the public, including 
advocacy and patient groups, the Congress, and other scientists, 
expenditures for medical research are always in public view. Though 
different from other enterprises, science has businesslike aspects: 
Applications for grants are subject to peer review (which is discussed 
later in this booklet) and rated for merit, and investigators define 
and justify the goals and budgets of their research with precision.
    It is a striking characteristic of science that it requires both 
creativity and precision to generate ideas and results. The precision 
with which investigators and administrators describe the targets and 
outcomes of research, however, cannot alter the inescapable truth that 
many of the results of research are unpredictable, given the pursuit of 
unknown things. The investigator examining patients with ataxia 
telangiectasia, a rare genetic disease, who discovers something new 
about the origins of cancer has not ``stumbled'' on a discovery, but 
rather has put himself or herself in a position to make the discovery 
and to bring it into the realm of known things which would not have 
happened otherwise.
    This unpredictability has three important implications of its own.
    First, science is by nature structured and self-correcting so that 
either a predicted or an unforeseen discovery has the advantage of 
adding to basic scientific knowledge and giving new direction to 
further inquiries. This self-correction, carried out under public 
scrutiny of the results, means that science operates in a dynamic 
marketplace in which an absolute or top-down control would be stifling. 
Control from the top or by directive grows inefficient as workers 
duplicate one another's labor or merely produce the same results; it 
tends to be slow to respond to new discoveries which can make the 
original grand design obsolete over night. Science's self-correction, 
on the contrary, demands more approaches and is quicker to adapt to 
change.
    Second, scientific work is not a commodity that can simply be 
bought. Shifting priorities is more than the redistribution of 
dollars--more money alone does not solve problems. Recruiting new 
talent by advertising a new scientific opportunity, inviting scientists 
in allied fields to look across the fence, and training new 
investigators to work in a new area will produce more meritorious 
applications for funding and, most important, better results in the 
treatment of human disease.
    Third, science and its administrators must constantly reevaluate 
and often change their priorities in light of new discoveries. Very 
simply, science itself sets its priorities as it refreshes and enlarges 
our knowledge: The more we know, the better the questions we can ask 
and the more wisely we can spend our money.
    It is by asking as many questions as we can and by prudently 
spending what we have that the NIH can identify and pursue the most 
promising medical priorities. As priorities shift and acquire sharper 
focus, we are better able to look across the spectrum of scientific 
disciplines and of diseases. Our constantly renewed knowledge enables 
us to examine, for example, the effects of pesticides not on one kind 
of cancer but on all cancers, or to ask the next big question--what 
turns genes on or off?--with the confidence that we will soon begin to 
find answers which in turn will allow us to target diseases like 
Alzheimer's disease, cancer, and diabetes.
    There are many reasons that America is blessed with a robust 
community of medical science and that the NIH is the world's greatest 
medical research organization. The freedom to explore, the training in 
our colleges and universities, an enthusiastic public, and an 
understanding Congress have all contributed to the nation's preeminence 
in medical research. And so, in part, has the community of science 
itself because of its abilities to refresh its priorities in order to 
seek opportunities that are ripe for pursuit and capture.
    The rest of this booklet describes the principles and processes by 
which the NIH and its Institutes set their priorities and make their 
choices. It will also consider in greater detail the roles played by 
the Congress and the Administration, by professional societies, and by 
organizations focused on particular diseases in funding the research 
that brings what we do not know into the realm of known things.
                             nih's history
    Decisions made in the NIH's early years still shape the agency's 
structure and activities. The NIH as we know it today is rooted in 
Constitutional language establishing the promotion of the general 
welfare as a goal of government. Throughout this country's history, 
citizens have looked to government to provide health care to specific 
populations, for collection of vital statistics on health, and for 
sanitation and control of infectious diseases. Although the NIH was 
born on Staten Island in 1887, with another name and a mission to 
conduct research on infectious diseases, the modern NIH took shape 
shortly after World War II, when science came to be seen as a public 
good and supporting health research became a focus for public and 
congressional enthusiasm and funding.
    In 1946, the NIH intramural research program (the research 
conducted by government scientists on the NIH campus in Bethesda, 
Maryland, since 1938) was joined by the NIH extramural research 
program. This occurred when wartime government medical research 
contracts at universities and medical schools around the country were 
transferred to the NIH and converted into grants. The transfer was an 
important event, for it firmly established the importance of enlisting 
scientists in the country's medical schools and universities in the 
national research effort against disease.
    Just after the extramural research program began providing grants 
to scientists in universities and medical schools, the NIH recognized 
it needed a system to help select the highest quality research grant 
applications for funding. This rapidly evolved into the NIH peer review 
system, which relies chiefly on non-government scientists to review 
grant applications for scientific merit.
    The NIH also recognized that supporting research demands a greater 
commitment than simply funding individual research projects. Since 
1947, NIH grants have included compensation to the institutions where 
the research is to be conducted for the expenses of maintaining the 
research facilities and for administering the grants. Training future 
generations of laboratory and clinical researchers also became an 
established goal of federal funding of science.
    The intramural research program on the Bethesda campus--which 
primarily focused on basic or laboratory science--was enhanced by the 
opening of its research hospital, the Clinical Center, in 1953. This 
addition acknowledged the importance of translating discoveries made in 
the laboratories to the bedside, and provided a way of taking questions 
raised through observation of patients back to the laboratory for 
exploration. The need to fund both laboratory research and clinical 
research thus became an established principle.
    Encouraged by the availability of public funding, growing numbers 
of investigators around the country--many of them trained on the 
Bethesda campus--directed their efforts to basic and clinical research 
and applied to the NIH for research grants.
    The NIH cultivated the cadre of talented, well-trained scientists 
eager to propose their ideas to the NIH for funding, thus creating the 
investigator-initiated research application as a way of tapping the 
best ideas to understand and combat disease.
    The following two decades saw significant increases in funding for 
the NIH and the development of new programs. New Institutes continued 
to appear in response to legislative or executive decisions. The 
establishment of each new Institute represented a decision about the 
priority to be given to a disease or class of diseases (for example, 
the National Institute of Allergy and Infectious Diseases was 
established in 1948 and the National Institute of Neurological Diseases 
and Blindness in 1950), to aspects of the human life span (the National 
Institute of Child Health and Human Development was established in 1963 
and the National Institute on Aging in 1974), and to broad areas of 
basic research and technology (the National Institute of General 
Medical Sciences was established in 1963 and the National Library of 
Medicine became a component of the NIH in 1968). Each of the NIH 
Institutes has been provided a separate, annual budget from the 
Congress, thus positioning each of them as a primary locus for setting 
priorities and making budget decisions within their domains. (See 
Appendix for list of Institutes)
                   how the nih funds medical research
    Most of the NIH's budget supports the individual research projects 
conceived of and conducted by either government scientists working on 
the NIH campus or scientists based elsewhere, at universities, medical, 
dental, nursing, and pharmacy schools, schools of public health, non-
profit research foundations, and private research laboratories. These 
scientists have been trained in one or more disciplines of science and 
are committed to enhancing knowledge related to human health and 
disease through research. NIH support of these research projects 
includes the salaries of scientists and technicians and the cost of 
equipment such as lasers or computers; of supplies such as chemicals 
and test tubes; and of procedures conducted with research patients.
    Funding medical research also includes paying the costs associated 
with research, such as maintenance of buildings, electricity and 
library services, care of laboratory animals, and salaries of 
administrative staff who, for example, handle the financial aspects of 
the grants and set up review panels to ensure that patients 
participating in research are adequately protected. This is true for 
all research, whether conducted in the intramural program by government 
scientists or through the extramural program by scientists in 
universities and medical schools or by scientists working in industry. 
These associated costs account for about 30 percent of the total cost 
of research projects.
    In fiscal year 1996, approximately 11 percent of the NIH budget was 
spent in the intramural program and more than 83 percent of the NIH 
budget was used to fund research by scientists working elsewhere across 
the country (see FIGURE 1). In the extramural program, the NIH 
emphasizes funding investigator-initiated applications that originate 
with individual scientists. These Research Project Grants (or RPG's) 
can fall anywhere along the continuum of medical research, from 
molecular and cellular investigations to studies of new drugs to treat 
human illness. In fiscal year 1996, the NIH funded approximately 25,000 
RPG's; the most common type, known as an R01 grant, supports a single 
project and a single principal scientist. Some Research Project Grants 
are program project grants, which support multi-disciplinary projects 
conducted by several investigators working on different aspects of a 
research problem. Yet another way the NIH supports research is through 
research centers. This type of grant is awarded to research 
institutions under the leadership of a center director and a group of 
collaborating investigators. Center grants fund multi-disciplinary 
programs of medical research and also support the development of 
research resources, aimed at integrating basic research with applied 
research and promoting research on clinical applications.
    Another part of the NIH's budget is spent on research and 
development contracts, which are awarded to non-profit and commercial 
organizations for work requested and overseen by the NIH staff. For 
example, development of the drug taxol for treating breast and ovarian 
cancer resulted from NIH contracts aimed at developing better methods 
for isolating the anti-cancer agent from the Pacific yew tree and for 
clinical trials of its efficacy.
    The NIH also supports training that enables young scientists to 
become skilled investigators who are available to apply their talents 
to future medical challenges. Trainees, who are at the predoctoral or 
postdoctoral level, are supported through grants either to individuals 
or to institutions such as medical schools and universities. Most of 
the cost is for stipends for the students. In recent years, the NIH has 
focused on enhancing the quality of training and improving the 
prospects for under-represented minorities rather than on increasing 
the total number of students in research training.
    An imperative of supporting medical research is making a commitment 
to scientists to fund their work for a period of time sufficient for 
the projects to produce results. Research takes time. NIH grants are 
awarded for an average of four years; therefore, the bulk of each 
Institute's annual budget is already committed to funding the remaining 
years of research projects. The need to continue funding projects over 
multiple years is an important criterion when deciding to fund new 
projects. Accordingly, in any given year, only about 25 percent of the 
total funds allocated for research projects is available to fund new 
projects that may change the course of a line of research or move 
research into an entirely new area.
          assessing health needs and scientific opportunities
    Deciding how and where to distribute the NIH's money--that is, 
determining the requirements of basic and clinical research, 
identifying whether a grant, contract, or center is the best means of 
funding a particular area of research, and responding to the emergence 
of new medical problems and new patient advocacies--is a challenge the 
NIH must face each year. It requires fresh assessment of the nation's 
health needs and renewed evaluation of scientific opportunity. Yet 
there are many ways of assessing health needs and many facets to 
identifying, and sometimes creating, scientific opportunities.
Assessing the health needs of the nation
    The NIH is responsible for conducting research on the broad array 
of health problems affecting people in this country, but it cannot 
simply allocate funds to research on one disease or another according 
to a set formula. There are many possible ways of measuring the health 
needs of the nation and distributing research funds, each with 
advantages and drawbacks. If health needs alone were used to gauge 
priorities, research funds might be distributed based on: The number of 
people who have a particular disease; the number of deaths caused by a 
disease; the degree of disability produced by a disease; the degree to 
which a disease cuts short a normal, productive, comfortable lifetime; 
the economic and social costs of a disease; and the need to act rapidly 
to control the spread of a disease.
    Using any one of these criteria to make funding decisions would 
produce a different result:
  --Funding according to the number of individuals affected would 
        emphasize common diseases, but might have a limited effect on 
        overall health and survival (for example, much research would 
        be done on the common cold and allergies and little on 
        childhood cancers).
  --Funding according to the number of deaths would neglect chronic 
        diseases that produce long-term disability and high costs to 
        society (diseases such as mental illness and arthritis would be 
        neglected).
  --Funding according to disability or economic cost raises questions 
        about how well disability or economic costs can be quantified, 
        and whether only the direct costs of medical care should be 
        counted or whether indirect costs (e.g., lost productivity), 
        which are difficult to measure, should also be included.
  --Funding according to the economic cost of illness would under-fund 
        diseases that result in a short illness and rapid death (this 
        choice would provide a great deal of funding for Alzheimer's 
        disease and muscular dystrophy and little, or none, for sudden 
        infant death syndrome or certain types of cancer).
  --Funding based solely on immediate dangers to public health may 
        divert funds from areas of research of much broader long-term 
        impact (this choice would mean that a great deal of research 
        would be done on AIDS and tuberculosis and little on 
        Parkinson's disease and asthma).
    All of these criteria for weighing health needs are justifiable, 
yet applying any one of them exclusively would cause the neglect of 
some classes of diseases altogether. Moreover, any of these criteria 
used exclusively would, for example, under-fund research on rare 
diseases, research that has taught us much about the diseases 
themselves and a great deal about normal human biology, other diseases, 
and new approaches to treatment. For example, ataxia telangiectasia, 
xeroderma pigmentosum, and Bloom's syndrome are very rare inherited 
disorders that lead to an increased risk of cancer and hypersensitivity 
to ultraviolet radiation, X-rays, and some chemicals that cause 
mutations in DNA. Nonetheless, research into these diseases has not 
only helped people with those conditions, but has provided considerable 
knowledge about the causes of cancer in general.
Funding the continuum of research, from basic inquiries to clinical 
        applications
    Clearly, it is not easy to determine how to allocate funds 
according to the impact of various diseases. But the problem is 
actually much more complex than it appears, because while the NIH 
focuses much of its research on combating specific diseases and much of 
its funding supports research projects that are of obvious relevance to 
specific diseases, the NIH also places a high priority on funding basic 
research. These basic research projects may appear initially to be 
unrelated to any specific disease, but might prove to be a critical 
turning point in a long chain of discoveries leading to improved 
health. Each of the NIH Institutes supports basic research likely to 
advance particular areas of science that might prove relevant to 
clinical problems important to that Institute's mission. By supporting 
disease-related and basic research projects simultaneously, the NIH can 
achieve both near-term improvements in the diagnosis, treatment, and 
prevention of specific diseases as well as long term discoveries in 
basic science that in time will produce great advances in our ability 
to understand, treat, and prevent disease or delay its onset.
    Consequently, the NIH uses no one measure exclusively, but all of 
these measures to assess the nation's health needs. The evidence of 
improved health in the past 50 years overwhelmingly demonstrates the 
importance of complementary accomplishments in basic and applied 
research. To continue improving the nation's health, the NIH also 
factors into its funding decisions current and evolving scientific 
opportunities.
Assessing scientific opportunities
    Assessing scientific opportunities is no less complex than 
evaluating health needs. It requires expertise in various scientific 
fields, breadth of vision across many disciplines, and judgment to 
determine the likely yield from making investments in particular areas 
of research. It is never known with certainty which scientific areas 
will produce the greatest returns soonest. At any given time, moreover, 
some fields are judged to be progressing more rapidly than others and 
more likely to repay the investment in them by yielding great 
discoveries that advance knowledge. Scientific opportunities may arise 
from many sources, from a single technological development, or from a 
scientific ``breakthrough.'' Often the breakthrough or even the 
knowledge accumulated is in an area that appears only remotely related 
to the area where it will have its greatest impact. Recognition of 
these scientific opportunities allow investigators to approach 
previously unanswered questions in new ways.
  --Basic Research Often Contributes to Specific Diseases.--The 
        unexpected contribution of basic research to specific diseases 
        is evident in the case of recombinant DNA research, sometimes 
        calledgenetic engineering. NIH support of basic research on 
        enzymes and genes over many decades, exciting and challenging 
        to scientists but initially with no apparent relevance to 
        practical applications or human disease, has led to a host of 
        new drugs and diagnostics. For example, in the mid-1980's human 
        growth hormone produced by recombinant DNA methods was approved 
        for treating certain growth problems in children. This 
        synthetic human growth hormone proved to be safer than using 
        pituitary-derived human growth hormone extracted from cadavers, 
        which had been found to transmit the virus causing Jakob-
        Creutzfeldt disease, a deadly neurological disorder. In 
        addition, recombinant DNA techniques revolutionized how 
        biological research is done and gave rise to a new industry--
        biotechnology. This technology, in just over a decade, has had 
        a profound impact upon medicine, agriculture, and the chemical 
        industry.
    Work in blood lipid research and heart disease illustrates how 
health needs and scientific opportunities coincide. Nearly 50 years 
ago, the NIH identified research on coronary heart disease as an 
important health priority. This disease is caused by atherosclerosis, 
the build up of lipids (fatty substances) in the heart's main arteries, 
which can block blood flow and thereby cause the death of heart 
tissue--that is to say, a heart attack. Progress in this area was slow 
at first, but then scientists began to associate lipids (such as 
cholesterol, carried in the blood) with the development of 
atherosclerosis in humans. In the early 1960's, research on the NIH 
Bethesda campus led to a way of classifying various types of lipid 
abnormalities in families. This work led to meaningful associations 
between variations in lipid metabolism and atherosclerotic heart 
disease. In addition, through carefully planned, long-term 
epidemiologic studies (studies of the occurrence and distribution of 
disease in large groups of people), the understanding emerged that risk 
factors such as blood cholesterol levels and cigarette smoking, as well 
as high blood pressure (which was recognized much earlier as a 
predictor of premature death) can make people susceptible to disease. 
Identifying scientific opportunities in basic, clinical, and 
epidemiological research on lipid metabolism has resulted in phenomenal 
progress in understanding the underlying processes that lead to 
atherosclerosis, as well as its prevention and treatment.
    Benefits from this research include the development of cholesterol 
lowering drugs and changes in behavior (less dietary fat, no smoking, 
more exercise), with a dramatic decrease in age-adjusted mortality from 
heart disease as a consequence. Still, many challenges in coronary 
heart disease remain. Future targeted areas of research include an 
analysis of why cholesterol accumulates in artery walls and ways to 
facilitate its removal, and prevention of the accelerated form of 
atherosclerosis which causes between 30 and 40 percent of grafts to 
become narrowed again after bypass surgery.
    Capitalizing on scientific opportunity depends, in part, on 
individual scientists designing specific research projects they believe 
have the greatest significance and offer the best chance of producing 
important knowledge. Therefore, the NIH places great reliance on 
investigator initiated research--projects conceived by individual 
scientists and submitted to the NIH to undergo review by other 
scientists and be considered for funding. Sometimes, the NIH solicits 
research applications through Program Announcements (PA's) and Requests 
for Applications (RFA's), as described in more detail later in the 
booklet. Review for scientific merit is conducted by groups of 
predominantly non-government scientists (with knowledge in a relevant 
area) convened as panels called study sections. Currently, there are 
about 100 study sections, which normally meet three times a year to 
review grant applications.
    The merit of a research proposal is assessed by several criteria, 
including: the importance of the problem or question; the innovation 
employed in approaching the problem; the adequacy of the methodology 
proposed; the qualifications and experience of the investigator; and 
the scientific environment in which the work will be done. Currently, 
slightly more than one in four grant applications received by the NIH 
is ultimately funded. (See FIGURE 2)
    In addition to judging the scientific merit of individual research 
grant applications, the study sections, in aggregate, have another 
important effect on the science supported by the NIH. After each study 
section reviews and rates the grant applications assigned to it by NIH 
staff, the relative ratings of applications from all study sections are 
then integrated. Because, for the most part, grants are funded in order 
of their rating relative to other applications in the same field, the 
fact that a study section has been constituted in a particular area 
usually guarantees that at least some applications in that area of 
science will be funded. Because of this effect, the NIH must monitor 
changes occurring in science to ensure that study sections, as a group, 
are appropriately constituted so that they can assess the research 
applications in all areas of scientific endeavor. The creation of new 
study sections, the restructuring of established study sections, and 
the use of special panels has such an important effect upon the areas 
of science funded by the NIH that any proposed changes of the study 
sections are carefully evaluated.
  --Breakthroughs Bring New Opportunities.--As an example of a 
        breakthrough offering new opportunities, consider recent 
        discoveries in the causes of obesity, which have stimulated the 
        NIH to invest more money in this particular area of research. 
        Obesity affects nearly one-third of the U.S. population. It is 
        associated with an increased risk of high blood pressure, high 
        blood cholesterol, and Type II diabetes (or non-insulin 
        dependent diabetes) and is an independent risk factor for 
        coronary heart disease and osteoarthritis. Obesity has been 
        studied for many years from many perspectives, and is of 
        interest to at least 10 NIH Institutes. But the problem has 
        remained intractable. Recently, scientists have found that mice 
        and rats with certain inherited mutations that predispose to 
        obesity lack a hormonal mechanism for maintaining healthy 
        patterns of eating and activity. Through this mechanism, the 
        animals--and, presumably, humans--regulate diet and exercise 
        through the brain's response to a hormone, called leptin, that 
        is produced by fat cells. Although it appears likely that this 
        hormone is itself deficient in a significant number of obese 
        people, the isolation of the genes for leptin and the leptin 
        receptor has already deepened our understanding of metabolism 
        and stimulated additional fundamental research. Encouraged by 
        the new findings, more and more scientists are moving into this 
        field of investigation. This is likely to expand knowledge of 
        the causes of obesity, hasten the development of more effective 
        medical therapies for weight problems, and ultimately help to 
        reduce the prevalence of many chronic, obesity-related 
        diseases.
                             the institutes
    The NIH is made up of 21 Institutes and Centers, each with a 
separate, annual budget from the Congress and, most critical to the 
question of priorities, each with a mission established by the 
Congress. To decide which grants to fund and which programs to support 
in terms of its mission, the director of each Institute confers with 
the Institute's program leaders. Like the director, they are scientists 
knowledgeable in research relevant to the Institute's mission and 
responsible for administering that area of research. The director also 
confers with members of the Institute's national advisory council (as 
mandated by the Congress), which meets three or four times a year to 
review all grant applications eligible for funding (after peer review) 
and to make recommendations on matters of policy and research emphasis. 
The council, which is composed of both scientific and public members 
with expertise relevant to the Institute's mission, may also make 
recommendations to the Institute director about funding particular, 
meritorious grants that are seen as very important but which may not 
have received the best scores from scientific reviewers. The council 
may also review and comment on special initiatives proposed by the 
Institute or, for example, on research training policies.
    The director engages in discussions with scientists in the 
extramural program and intramural investigators, with groups of 
patients and their families interested in research on particular 
diseases, with professional and scientific groups, with representatives 
of the Administration and members of Congress, and with the public. 
(See FIGURE 3)
    Advice is sought on many issues, including: The potential impact of 
particular research areas on human health; the critical scientific 
opportunities; gaps in knowledge that merit special effort; the cost of 
specific research projects and their benefits; economic issues, 
including the potential effects of the research on quality of life; the 
balance between intramural and extramural research; the balance among 
laboratory research, clinical research, and epidemiological research; 
and the specific type of funding to use for various research areas, for 
example, selecting among grants, contracts, and support of centers (see 
definitions of the types of funding).
Funding the highest quality science
    The advice an Institute director receives from many sources on the 
factors enumerated above provides much of the information needed to 
decide which grants and programs to support and which programs to 
initiate or eliminate.
    As described earlier, research projects emerge from the creativity, 
skill, and knowledge of extramural scientists who submit grant 
applications to the NIH. These are reviewed by panels of scientists who 
are expert in the proposed field of research. Intramural scientists are 
also peer reviewed by special groups called Boards of Scientific 
Counselors, consisting of scientific experts chosen mainly from outside 
the government. Thus, it is the highest rated projects that form the 
backbone of the science funded by the Institutes and by the NIH. The 
outstanding ideas of scientists objectively rated for their own merit 
and against publicly stated criteria, like those listed in the previous 
section, guide the funding decisions of the NIH.
Creating research opportunities
    While over half of the Institutes' funds support grant applications 
submitted by scientists working in universities, medical schools, other 
professional schools, and independent research centers on subjects they 
deem important, there is also a complementary process within the 
Institutes to look at broad areas of science and identify areas of 
research where special emphasis is warranted. The scientific program 
leaders in the Institutes help identify scientific opportunities or 
techniques ripe for application by staying abreast of the scientific 
literature and attending conferences and meetings of professional 
societies where new basic and clinical findings are presented and 
debated. If, for example, an Institute is convinced that a particular 
area of science offers opportunity, but extramural scientists are not 
generating research proposals in that area, the Institute may decide to 
organize a workshop or conference to identify specific scientific needs 
and opportunities, stimulate research applications, and attract 
scientists into the field. Or if an Institute wants to encourage 
extramural scientists to apply their particular skills to a new 
challenge, Institute program leaders may generate a concept that will 
become a Program Announcement (PA), an ongoing request for applications 
in a broad area of interest, or a Request for Applications (RFA), a 
one-time request for applications addressing a specific scientific 
area. While only a small percentage of an Institute's funds is spent on 
research generated in response to RFA's and PA's, this modest 
investment has been a catalyst for scientific progress.
    Although funding is usually determined by the scientific merit of 
research applications, an Institute may determine that an area of 
research is of such great promise that funding is provided even if the 
grant application does not have as high a relative rating as other 
applications. Only the Institute director has the authority to make 
this decision and it requires his or her awareness of the whole picture 
of the Institute's mission. The Institute director may determine that 
some laboratory research areas are in need of greater attention and 
require more funding or that some areas are ripe for translating 
laboratory or animal studies to patients in clinical research studies. 
The Institute director would discuss these decisions with council 
members (and others) before funding this research.
    The Institutes may also collaborate on common research interests or 
to advance certain topics of research. For example, both the National 
Institute of Neurological Disorders and Stroke and the National Heart, 
Lung, and Blood Institute are interested in stroke, and five 
Institutes--the National Institute of Arthritis, and Musculoskeletal 
and Skin Diseases, the National Institute on Aging, the National 
Institute of Dental Research, the National Institute of Diabetes, 
Digestive and Kidney Diseases, and the National Institute of Child 
Health and Human Development--are interested in osteoporosis. Each 
Institute brings a different perspective and interest to an issue, so 
their collaborations encourage a multi disciplinary approach to 
research problems. Sometimes, Institutes cofund research projects that 
are important to the mission of each.
  --Collaborative Success Story.--An example of a cross-Institute 
        collaboration that has produced a distinct benefit is the 
        collaboration between the National Institute of Neurological 
        Disorders and Stroke (NINDS) and the National Human Genome 
        Research Institute (NHGRI) in Parkinson's disease. Parkinson's 
        disease is one of the most devastating and prevalent 
        neurodegenerative disorders. The advent of dopamine replacement 
        therapy in the 1960's provided significant improvement for many 
        patients, but the effectiveness of the treatment declines over 
        time and there are troublesome side effects. There has been 
        great interest among both patients and researchers to develop a 
        more effective treatment or even to prevent the disease, but 
        the mechanism of Parkinson's disease is not sufficiently 
        understood.
      In 1995, a group of scientists called together by NINDS and other 
        Institutes concerned with Parkinson's disease reached the 
        unexpected conclusion that Parkinson's disease is likely to 
        have a stronger genetic component than was previously thought. 
        NINDS subsequently issued a program announcement inviting 
        research grant applications in the genetics of Parkinson's. In 
        addition, a collaboration involving NHGRI intramural scientists 
        and NINDS grantees was established to study the genetics of 
        families affected by Parkinson's. In November 1996, scientists 
        from the NHGRI and NINDS and their collaborators at Robert Wood 
        Johnson Medical School and in Italy announced they had 
        pinpointed the location of a gene responsible for some cases of 
        Parkinson's disease, showing that a single gene alteration can 
        cause the disease. In June 1997, the specific responsible gene 
        was identified. Learning where the protein product of the gene 
        is located in nerve cells and how it works may help scientists 
        design treatments for all forms of Parkinson's disease--not 
        only inherited cases, but also those with no familial risk.
The Intramural Research Program
    The Institutes sometimes also co-fund research programs with 
agencies outside the NIH when a scientific opportunity is ripe for both 
agencies. For example, the National Cancer Institute has collaborated 
with the Department of Defense on breast cancer studies, and the 
National Heart, Lung, and Blood Institute has worked with the Health 
Care Financing Administration on clinical trials of lung reduction 
surgery in the late stages of emphysema.
    Most of the Institutes have intramural research programs. Amounting 
to approximately 11 percent of the total NIH budget in fiscal year 
1996, they focus on specific health problems of special concern to a 
particular Institute and conduct basic research that may not target a 
specific disease, but relates to the overall mission of the Institute. 
As with extramural research, program adjustments, driven by scientific 
opportunity, are constantly being made to the intramural research 
programs. The Institute intramural research programs are led by 
scientific directors, outstanding scientists who, with the Institute 
director, are responsible for organizing and administering both 
laboratory and clinical research. They undergo peer review by a Board 
of Scientific Counselors, which advises the director of the Institute 
on the importance and quality of the programs, thus providing yet 
further scrutiny of the distribution of resources to particular 
research areas and scientists. The intramural programs of the 
Institutes are also reviewed by the national advisory councils and, 
sometimes, by additional panels of outside experts convened to address 
specific issues.
    Ideas from outside the NIH also influence research choices. For 
example, in 1971 President Nixon signed the National Cancer Act, making 
cancer research a national priority. The Congress, responding to 
constituents, has also influenced NIH priorities by occasionally 
identifying research areas that the Institutes should consider more 
intensely. The Institute directors meet with congressional members and 
staff throughout the year, and formally during the annual budget 
hearings, to discuss the research advances of each Institute during the 
past year and describe their plans for the next. Through both the 
Administration and Congress, as well as through patient advocacy 
groups, the public influences the Institutes' decisions. In addition, 
the national advisory councils set up by each Institute and other NIH 
advisory committees include members specifically designated as 
``public'' representatives. Proposals and opinions from scientists, the 
Congress, the Administration, and the public assure that the Institutes 
establish their priorities in the light of many views. Ultimate 
responsibility for the allocation of financial and other resources of 
an Institute rests with the Institute director. After careful 
evaluation of all of the factors described above, the Institute 
director determines how and where the Institute's resources will be 
distributed.
  --IRP Flexibility and Concentrated Expertise.--Two particular 
        characteristics of the NIH intramural research program proved 
        advantageous at the start of the AIDS epidemic, even before the 
        disease was named. First, the intramural program has the 
        flexibility to redirect resources and expertise quickly when an 
        urgent research problem or public health threat is recognized. 
        In addition, the intramural program has a concentrated 
        expertise focused exclusively on research, and an atmosphere 
        that encourages discussions and collaborations across 
        disciplines.
      Intramural scientists studying the immune system and virologists 
        studying the cause of AIDS were able to draw on colleagues in, 
        for example, the dental, neurological, and eye Institutes for 
        consultations on particular clinical manifestations of AIDS. An 
        informal series of patient conferences was set up at the very 
        beginning of the epidemic, in the early 1980's. This 
        concentrated effort led to major accomplishments in AIDS 
        research by the NIH intramural program, for example: a detailed 
        description of the effects of HIV on the immune system; 
        development of a treatment for a viral infection, 
        cytomegalovirus, causing blindness in AIDS patients; early 
        development of policies to screen blood donors (and hence to 
        prevent the further spread of AIDS through the blood supply); 
        understanding of the unusual proteins encoded by HIV genes; 
        development of a blood test for HIV; formulation of hospital 
        guidelines for working safely with AIDS patients; and early 
        studies of the first treatment for AIDS, the drug AZT.
                      the role of the nih director
    Though each Institute within the NIH determines how it will deploy 
its talent and funds, the NIH Director plays an active role in shaping 
the agency's activities and outlook. With a unique and critical 
perspective on the whole of the NIH, the Director is responsible for 
providing leadership to the Institutes and for constantly identifying 
needs and opportunities, especially for efforts that involve multiple 
Institutes. The Director stays in touch with each Institute's 
priorities and accomplishments through regular senior staff meetings, 
discussions with scientific interest groups (scientists who have 
interests in a specific area and can provide guidance in solving 
scientific questions), and briefing sessions with Institute directors. 
The Director also seeks advice from special panels of experts convened 
to address issues that are of interest to more than one Institute, 
e.g., reviews of NIH support of research relevant to human gene 
therapy, the NIH investment in clinical research, the operation of the 
NIH intramural research program, and the effectiveness of the NIH peer 
review procedures. In addition to this flow of information from 
scientists, the Director is advised through discussions with the 
Administration, usually through the Department of Health and Human 
Services (DHHS), and with the Congress.
    Within the NIH, the NIH Director is primarily responsible for 
advising the President on his annual budget request to Congress on the 
basis of extensive discussions with the Institute directors. The 
formulation and presentation of the NIH budget provides an established 
framework within which priorities are identified, reviewed, and 
justified. A key strategy of the NIH Director in the past few years is 
the identification of Areas of Research Emphasis, broad categories of 
NIH-sponsored research that show extraordinary promise and 
productivity. Each year, the NIH Director requests proposals from the 
Institutes for areas of research that would benefit from special 
emphasis. Six broad areas of emphasis have been identified for fiscal 
year 1998; five of these, including ``Biology of Brain Disorders,'' 
``New Approaches to Pathogenesis,'' ``New Preventive Strategies Against 
Disease,'' ``Genetic Medicine,'' and ``Advanced Instrumentation and 
Computers,'' were also identified in fiscal year 1997. A new Area of 
Research Emphasis, ``New Avenues for Development of Therapeutics,'' 
emerged from consideration of Institute proposals for new initiatives 
for fiscal year 1998. The Institutes are encouraged to develop new 
initiatives within these Areas of Research Emphasis and to respond to 
emerging health needs through both inter- and intra-Institute efforts. 
The NIH Director uses these proposals to build the President's budget 
in order to ensure that new initiatives are meritorious and timely and 
that budget increases are used to capitalize on recent scientific 
developments. The Director has two additional tools to identify and 
fund NIH research efforts. First, the Director may, following a clearly 
defined process, transfer up to one percent of the total NIH budget 
among Institutes. Second, the Director has a Discretionary Fund. Both 
are used to jump start particularly exciting or urgent areas of 
research:
  --Transfer funding from the Director typically follows extensive 
        discussions between and among the NIH Director and the 
        Institute directors, and advice from outside experts to 
        identify particular research initiatives that reflect NIH-wide 
        priorities, show real promise, or reflect an emerging need that 
        requires a timely infusion of funds. DHHS, the Administration, 
        and congressional appropriations subcommittees are then 
        notified of the NIH intent to transfer the money. No single 
        Institute can lose more than one percent of its appropriated 
        funds in this process.
  --The NIH Director uses the Discretionary Fund, as appropriated for 
        this purpose by the Congress, to support specific research 
        opportunities that arise during the course of a year that would 
        otherwise have to wait until the following year for funding. 
        The NIH Director can, in this way, provide early support to 
        research by giving additional funds to a single Institute or to 
        several Institutes. The NIH Director can also use these funds 
        to respond to specific requests from the Congress or to a 
        public health emergency. One way the Director's Discretionary 
        Fund has been used in recent years is to fund the Shannon 
        Awards (named after an illustrious former NIH Director), which 
        provide some funding for deserving projects that could not be 
        paid for within the available budget. This is a means of 
        keeping investigators, especially new investigators, active 
        scientifically until funding becomes available for supporting 
        their research applications.
    Program offices in the Office of the Director are also responsible 
for enhancing some of the cross-Institute coordination of, for example, 
minority health, women's health, disease prevention, rare diseases, 
behavioral and social science research, and complementary and 
alternative medicine. Another program office is the Office of AIDS 
Research, which has been given broad legislative authority to plan, 
coordinate, evaluate and budget all NIH AIDS research. Like the other 
offices within the Office of the Director, it funds research through 
the various Institutes. The NIH is strongly committed to identifying, 
developing, and pursuing research that reflects broad approaches to 
understanding human illness and health.
    Many diseases under study at the NIH require the input of more than 
one Institute. While the Institutes themselves enjoy close collegial 
relationships and employ a number of mechanisms to foster their 
collaborations, the NIH Director has a unique overview of the range of 
endeavors across the entire NIH. The Director thus can influence all 
the Institutes to focus on matters of importance to them all.
                               conclusion
    All of the activities described here have the common purpose of 
informing the NIH of scientific opportunities and of important needs in 
public health. Recognizing needs--and establishing priorities among 
them--stimulates the most promising medical research and advances our 
knowledge. The continuing dialogue between the public and scientists 
ensures a system that is both stable and responsive--a system that 
effectively and efficiently meets its goal to improve the nation's 
health through medical research.
       appendix--nih institutes and centers \1\--date established
---------------------------------------------------------------------------
    \1\ Each with a separate annual budget from the Congress.
---------------------------------------------------------------------------
    National Cancer Institute (NCI)--1937
    National Eye Institute (NEI)--1968
    National Heart, Lung, and Blood Institute (NHLBI)--1948
    National Human Genome Research Institute (NHGRI)--1989
    National Institute on Aging (NIA)--1974
    National Institute on Alcohol Abuse and Alcoholism (NIAAA)--1970
    National Institute of Allergy and Infectious Diseases (NIAID)--1948
    National Institute of Arthritis and Musculoskeletal and Skin 
Diseases (NIAMS)--1986
    National Institute of Child Health and Human Development (NICHD)--
1963
    National Institute on Deafness and Other Communication Disorders 
(NIDCD)--1988
    National Institute of Dental Research (NIDR)--1948
    National Institute of Diabetes and Digestive and Kidney Diseases 
(NIDDK)--1950
    National Institute on Drug Abuse (NIDA)--1974
    National Institute of Environmental Health Sciences (NIEHS)--1966
    National Institute of General Medical Sciences (NIGMS)--1963
    National Institute of Mental Health (NIMH)--1946
    National Institute of Neurological Disorders and Stroke (NINDS)--
1950
    National Institute of Nursing Research (NINR)--1986
    National Library of Medicine (NLM)--1968, became a part of the NIH
    National Center for Research Resources (NCRR)--1956
    John E. Fogarty International Center (FIC)--1968
                 nih working group on priority setting
    Stephen I. Katz, Chair, Director, National Institute of Arthritis 
and Musculoskeletal and Skin Diseases
    Anne Thomas, Co-Chair, Associate Director for Communications, 
National Institutes of Health
    Marvin Cassman, Director, National Institute of General Medical 
Sciences
    Rex Cowdry, Acting Deputy Director, National Institute of Mental 
Health
    Patricia Grady, Director, National Institute of Nursing Research
    Suzanne Hurd, Director, Division of Lung Diseases, National Heart, 
Lung, and Blood Institute
    John McGowan, Deputy Director, National Institute of Allergy and 
Infectious Diseases
    Ken Olden, Director, National Institute of Environmental Health 
Sciences
    Mary Miers, Chief, Science Policy and Analysis Branch, National 
Institute of Neurological Disorders and Stroke
    Al Rabson, Deputy Director, National Cancer Institute
    Helen Simon, Chief, Office of Program Planning and Evaluation, 
National Institute of Arthritis and Musculoskeletal and Skin Diseases
    Lana Skirboll, Associate Director for Science Policy, National 
Institutes of Health
    Harold Slavkin, Director, National Institute of Dental Research
    Harold Varmus, Ex-Officio, Director, National Institutes of Health
    Judith Whalen, Associate Director for Science Policy, Analysis, and 
Communication, National Institute of Child Health and Human Development
                              sarcoidosis
    Question. Have there been any recent breakthroughs which have 
provided insight into the cause or causes of sarcoidosis?
    Answer. The cause(s) of sarcoidosis is a question that has recently 
received increased attention. The National Heart, Lung, and Blood 
Institute (NHLBI) supports two major clinical studies which are 
investigating the cause of or contribute to development of sarcoidosis.
    In one, ``A Case-Control Etiologic Study of Sarcoidosis'' (ACCESS), 
investigators will use information obtained from study participants to 
identify environmental exposures, family characteristics, and co-
existing diseases that contribute to sarcoidosis. In addition, blood 
samples will be analyzed to pinpoint exposure to infectious agents or 
genetic variations that may occur more frequently in sarcoidosis 
patients than in a control population. Information about relatives with 
sarcoidosis will be used to determine the frequency of familial disease 
and to provide preliminary information about the inheritance pattern of 
the disease.
    In another study, ``Genetic Epidemiology of Sarcoidosis,'' the 
investigators will conduct analyses in a large population of African-
Americans, which may explain the pattern of inheritance of sarcoidosis 
and the role of major and minor genes in the development of the 
disease. Moreover, the investigators will look for an association of 50 
specific candidate genes with the development of sarcoidosis. In 
addition, the NHLBI supports a study on the role of the immunologic and 
inflammatory processes mediating the granulomatous inflammation seen in 
pulmonary sarcoidosis.
    Although these studies are not yet far enough along to provide 
answers to the question of the cause of sarcoidosis, final results of 
the investigations should improve our understanding of sarcoidosis and 
identify avenues of more specific investigation.
                           pediatric research
    Question. Are efforts underway to focus more resources on the 
diseases and illnesses that affect our nation's infants and children?
    Answer. The NIH supports a large and varied pediatric research 
portfolio, which is more than $1.6 billion in fiscal year 1997. This 
includes studies ranging from those to better understand normal 
developmental processes, from the prenatal period through adolescence, 
to studies concerning specific children's diseases and health problems. 
These studies and activities include basic biological and behavioral 
research, clinical trials, health services research, and efforts in 
public health education.
    Most recently, the NIH made a formal commitment to increase the 
participation of children in NIH-supported clinical research. Medical 
treatments applied to children are often based on testing done in 
adults. Problems can arise from this situation because children have 
different reactions and physiologic responses than do adults. 
Additionally, scientifically-evaluated treatments are less available to 
children due to previous barriers to their inclusion in research 
studies. To address these concerns, the National Institute of Child 
Health and Human Development (NICHD), in conjunction with the Office of 
Extramural Research, established a trans-NIH working group to develop a 
policy and an implementation plan for requiring applicants proposing 
research involving human participants to describe their plans for 
including, or justification for excluding, children in the project. 
Based on these efforts, the NIH published guidelines on the inclusion 
of children in research in the NIH Guide for Grants and Contracts, and 
the formal policy will be implemented starting October 1, 1998.
    The fiscal year 1997 NIH Appropriation also included $5 million to 
fund a Pediatric Research Initiative. The funding level for this 
initiative was increased to $38.5 million in fiscal year 1998. These 
funds have been allocated to various Institutes and Centers to 
encourage innovative pediatric research and collaborative efforts in 
three designated areas: pediatric therapeutics, developmental 
abnormalities, and pediatric asthma. These areas were selected because 
of their significant impact upon child health. For example, drugs are a 
critical component of pediatric care. However, the majority of drugs 
administered to children have not been tested in pediatric populations. 
New drugs for treating childhood illnesses need to be developed, and 
appropriate testing of available drugs must be done so that they can be 
used safely and effectively in children. Developmental abnormalities 
are another important aspect of child health. While they stem from 
diverse causes, many have an underlying genetic component. Most 
developmental abnormalities are relatively rare, but collectively, they 
have a profound effect on the health and quality of life of the 
Nation's children. Finally, asthma is a major chronic disease involving 
obstruction of the bronchial airways. Its prevalence and severity in 
children is increasing in the U.S., particularly in minority 
populations.
    The health and well being of our Nation's children is paramount. 
Medical research conducted and supported by the NIH is an indispensable 
element for ensuring continued and steady improvement in the health and 
quality of life of children. The NIH continues its strong commitment to 
research that addresses both the disorders that affect infants, 
children, and adolescents and the factors that enhance and promote 
normal, healthy development. NIH-supported pediatric research will 
continue to yield and expand important advances in understanding, 
diagnosing, treating and preventing illnesses that affect children 
throughout all stages of development.
                          cloned human embryos
    Question. Does the NIH support legislation which bans the creation 
of cloned human embryos?
    Answer. The NIH does not support legislation that would ban the use 
of somatic cell nuclear transfer using human cells in order to 
investigate, and hopefully, someday, produce cells and tissues that may 
be used to prevent and treat serious and life-threatening diseases and 
other medical conditions. I do, however, believe that the use of 
somatic cell nuclear transfer cloning to create a human being is 
untested, unsafe, and morally unacceptable. However, we agree with the 
National Bioethics Advisory Commission that this issue must continue to 
be debated. Therefore, I support the President's bill that would 
include a ban on the use of somatic cell nuclear transfer cloning 
techniques to create a human being, with a five-year sunset provision 
to provide for further review of the ethical and scientific issues 
associated with the use of somatic cell nuclear transfer and that would 
protect important biomedical research.
                                 ______
                                 
             Questions Submitted by Senator Lauch Faircloth
                          research priorities
    Question. There is concern among many that NIH in general, and the 
NIMH in particular, desire to invest less in disease-oriented and 
clinical research, and more in basic scientific research. Please 
describe for the Subcommittee what you think is the appropriate balance 
at NIMH between basic research funding and clinical and services 
research. Does NIMH intend to invest more in basic research? If so, how 
much more?
    Answer. Research on the causes, treatment, and prevention of mental 
illnesses is integral to the mission of the National Institute of 
Mental Health (NIMH); indeed, this research is the primary focus of all 
NIMH programs. Mental illnesses are diverse and, even though science is 
rapidly making enormous strides, very little is known about the causes 
of any of these illnesses. We do know that the key to these illnesses 
lies in basic research on the molecular and cellular changes in the 
brain and on understanding how the brain is changed by these diseases 
to produce the behavioral manifestations of these illnesses. This is 
the only way that we will ever understand how to most effectively 
treat, or to prevent, mental illnesses. NIMH basic research is directed 
toward understanding the changes in the brain and behavior that 
determine mental disorders.
    At the same time we must continue to apply what we already know to 
clinical studies and services for patients. Thus, support for clinical 
research and health services research by NIMH is also expanding. The 
NIMH assesses the balance between all these elements of its research 
endeavors and makes changes in emphasis as the scientific and clinical 
opportunities for studies warrant.
    In shaping its research program, NIMH periodically establishes 
research priorities, then continues to evaluate these priorities in the 
light of accumulating research-based knowledge. The appropriate balance 
between basic research funding and clinical and services research 
varies somewhat over time as advances in science create new 
opportunities to address specific research questions and to explore new 
avenues to treatment or prevention, or as marked changes in the mental 
health-care landscape--such as the advent of managed care--create new 
public mental health questions. NIMH relies on the National Advisory 
Mental Health Council (NAMHC), composed of both expert scientists and 
representatives of the public, to continually monitor the Institute's 
program balance and to assist in setting and reviewing research 
priorities. The NAMHC reviews and approves all research grants awarded, 
and, in addition, through special workgroups and task forces, the 
Council undertakes comprehensive, in-depth reviews of major segments of 
the NIMH research program and these reviews produce quite specific 
recommendations for program directions and emphasis.
    Based on recent recommendations by the National Advisory Mental 
Health Council and on emerging scientific opportunities, the NIMH 
intends to increase support for important areas of basic research as 
well as a broad spectrum of patient-oriented research--including 
clinical research, services research, and translational research that 
will accelerate the incorporation of basic research findings into 
clinical care. However, at this time, it is not possible to attach 
dollar amounts to these investments.
                             schizophrenia
    Question. Schizophrenia is the most severely disabling mental 
disorder and is among the most severe illnesses that afflict mankind. 
The statistics bear this point out; (a) schizophrenia strikes in young 
adulthood usually resulting in a lifetime of severe disability, (b) 
consumers with schizophrenia account for nearly 25 percent of all those 
receiving disability payments from the federal government, (c) 
schizophrenia costs the nation $32 billion each year, (d) consumers 
with schizophrenia occupy 40 percent of all hospital beds in the United 
States, (e) 10 to 15 percent of its victims commit suicide. While there 
has been important treatment advances in the 1990's, much has to be 
learned about this disease. We still do not understand what causes this 
illness, we have no diagnostic markers for schizophrenia, and 
treatments are but palliatives and not cures. By NIMH's own accounting, 
investment in schizophrenia research modestly declined in the first 
part of this decade--by approximately 10 percent. Given the severity of 
this illness and a record of decreasing research investment, what does 
NIMH plan to do to advance our understanding and treatment of 
schizophrenia? How much money is needed in this area of research? What 
are the most important barriers to research advances in schizophrenia, 
in your view? How can Congress assist you in conquering this terrible 
disease?
    Answer. Schizophrenia research continues to have a prominent place 
in NIMH programs. The Institute is committed to studies of the 
neurobiological substrates of schizophrenia, its neurodevelopmental 
origins, and the inheritance of and expression of vulnerability genes 
in the brain, as well as other factors that may trigger or exacerbate 
schizophrenia. For example, the NIMH Genetics Initiative has provided 
new funding to augment the number of patient samples available for 
gene-finding efforts in schizophrenia. Efforts are also underway to 
characterize exactly which of the Gamma aminobutyric acid (GABA) brain 
regions and which neurons are affected. There are preliminary data to 
suggest that small GABA interneurons, in particular, may be abnormally 
``connected'' in patients with schizophrenia, while there is a growing 
body of data pointing towards the involvement of specific emotional and 
higher cognitive centers of the brain. This localization is consistent 
with many of the behavioral manifestations of schizophrenia. 
Neurochemical theories of schizophrenia also continue to be studied, 
and there is growing evidence pointing toward the possible involvement 
of excitatory neurotransmission involving glutamate.
    While we do not yet have a cure for this devastating illness, in 
the past few years, three new, ``atypical'' antipsychotics have become 
available. These represent major therapeutic advances, since they are 
better-tolerated, and preliminary evidence suggests that they may be 
more effective than traditional antipsychotics. NIMH has initiated 
clinical studies to determine if these new treatments are indeed more 
effective, and if so, in which patient groups they are best used.
    Over the last 5 years NIMH has cofunded, with the Agency for Health 
Care Policy and Research (AHCPR), the Schizophrenia Patient Outcomes 
Research Team (PORT). The mission for this PORT was to identify and 
analyze the outcomes and costs of various treatments for schizophrenia; 
to determine the most cost-effective means to treat or manage the 
condition; and to develop and test methods for reducing inappropriate 
or unnecessary variations in treatment. The same investigative team was 
funded recently to conduct a field trial of a methodology for assessing 
the quality of care provided to patients with schizophrenia.
    The fiscal year 1999 President's Budget request will permit NIMH to 
take advantage of the most important immediate research opportunities.
    There are a number of reasons why progress in understanding 
schizophrenia and finding a cure has been slow. First and foremost, 
schizophrenia is a disease unique to humans. There is no animal or 
tissue model that accurately reflects the manifestations of the disease 
in man, and this necessarily limits the investigations that can be 
performed. Many of the powerful methods for studying molecular or 
cellular processes that have led to rapid advances in our understanding 
of other illnesses cannot be applied to schizophrenia, since they 
involve destruction or severe disruption of the tissues that are being 
studied.
    There are other barriers as well. Schizophrenia is difficult to 
treat and few people with the diagnosis--even those who respond well to 
treatments--return to their pre-illness level of functioning. Because 
of this, we need to go beyond therapeutic studies and start thinking 
about prevention. Yet we know little about factors that influence the 
course of this illness. The NIMH is developing research to aid in 
identifying indicators of risk for onset of disease, relapse, poor 
functional outcomes, and suicide. The programs will also translate 
emerging findings from the basic sciences into new strategies for 
prevention and early intervention. We are hopeful of substantial 
progress in the next decade. There is also a lack of understanding of 
how the newer atypical antipsychotics work. Their mechanism of action 
is very complex, affecting multiple brain transmitter systems. This 
complexity may be a critical feature of their greater efficacy, and 
will remain a central focus of research efforts in the near future.
    With the funds requested in the fiscal year 1999 President's Budget 
Request and the flexibility to use these funds in areas of greatest 
opportunity, NIMH will be able to accelerate research on schizophrenia.
                         supply of researchers
    Question. As I am sure that you will agree, there is a great need 
to attract new researchers and clinicians into psychiatry--in the areas 
of genetics and severe mental illnesses in children and adolescents in 
particular. Could you please comment on the problems you see in terms 
of the human resources available to study and treat these serious brain 
disorders? What do you intend to do to recruit new and talented 
individuals to these fields? How can Congress assist you in this 
activity?
    Answer. Several high-priority research areas such as the genetics 
of mental illnesses and childhood and adolescent mental illnesses are 
drawing on a very small cadre of investigators, many of whom have 
pioneered these fields. However, as these areas of research develop and 
expand, progress depends on the availability of more well-trained 
investigators. The National Institute of Mental Health (NIMH) will 
develop strategies to attract more researchers into these critical 
areas. For example, in the area of pediatric mental illness, most 
researchers are drawn from the small groups of clinically trained child 
psychiatrists and child psychologists. Given the length of clinical 
training, many potential investigators are diverted (often for 
financial reasons) into non-research careers. However, while there are 
only 5,000 child psychiatrists nationwide, there are over 100,000 
pediatricians, adult psychiatrists, and neurologists, from whose ranks 
new child mental health-focused investigators could be drawn.
    NIMH anticipates two major activities in this area. (1) The 
Institute will issue a new career award to attract researchers such as 
neurologists, adult psychiatrists, and psychologists, who have not 
typically studied in this age group to encourage them to learn about 
how to do clinical studies of children and adolescents and to redirect 
their efforts. A similar strategy will be employed for other shortage, 
high priority research areas. (2) NIMH will develop supplements to 
existing research grants for young investigators who are interested in 
studying childhood psychopathology or other similar high priority 
areas.
    The fiscal year 1999 President's Budget Request was developed after 
lengthy examination and discussion of scientific opportunities and 
research needs, and NIMH feels that this level of funding will provide 
good support for strengthening the recruitment of researchers into 
critical areas of study.
                                 stroke
    Question. As a member of the Congressional Heart and Stroke 
Coalition, I am particularly concerned about NIH resources devoted to 
stroke. Stroke will cost this nation an estimated $43.3 billion in 
medical expenses and lost productivity in 1998, including more than $7 
billion in direct Medicare and Medicaid expenditures. Yet, the 
President's fiscal year 1999 budget would allow only $88.5 million for 
the National Institute of Neurological Disorders and Stroke-supported 
stroke research. Actual fiscal year 1997 funding for NINDS stroke 
research was a mere $76.8 million. Actual fiscal year 1997 overall NIH 
stroke research funding was only $143.1 million.
    How do you account for this inequitable allocation for resources to 
stroke? What are you doing to rectify this situation?
    Answer. Stroke is a serious health problem as shown by its rank as 
the third leading cause of death in the U.S. Stroke is one of 600 
disorders which lie within the mission of the National Institute of 
Neurological Disorders and Stroke (NINDS). As with other disorders, 
allocation of resources is the culmination of a number of factors 
including scientific opportunities and public health burden. NINDS and 
other Institutes at NIH have long been committed to stroke research. I 
would like to highlight just some of the advances and major 
contributions that have been made by NIH in the prevention and 
treatment of stroke. For example, tremendous progress has been made in 
preventing stroke by controlling high blood pressure. But there are 
other risk factors and the more we understand and control these, the 
more we can prevent stroke. NINDS clinical studies have demonstrated 
that many strokes can be prevented by either medical or surgical means. 
Beginning in 1987, NINDS funded clinical trials to evaluate the use of 
a surgical procedure, known as carotid endarterectomy, in which a 
blockage in the carotid artery is removed. The studies were designed to 
look at the severity of the blockage and whether the patients in the 
study already had a stroke or warning signs of a stroke. Now that the 
results that describe which patients can benefit from the surgery have 
been published, patients and their physicians have important 
information that they need to make health care decisions. There is now 
no question that surgery benefits patients who have 70 percent or 
greater stenosis or narrowing of the carotid arteries. The most recent 
result, announced in 1998, shows that, for symptomatic patients with 
stenosis of 50-69 percent, surgery may be worthwhile. For people with 
symptoms, but less than 50 percent stenosis, surgery is not as 
beneficial. Another prevention strategy, for which NINDS initiated 
clinical trials is to evaluate the relative benefits of aspirin and 
warfarin to prevent stroke in patients who have irregular heart beats 
or atrial fibrillation. Results from the study, announced in 1990, 
1994, and 1996 demonstrated that both aspirin and warfarin can be 
beneficial and provided information as to whether the use of aspirin or 
warfarin may be preferable, depending on other factors about the 
patient. NINDS also has ongoing a number of clinical trials that will 
further benefit people at risk for stroke. These include a study of 
vitamin intervention for stroke, stroke prevention in African 
Americans, and the use of estrogen to decrease the risk of a repeat 
stroke in postmenopausal women who have already had at least one 
stroke.
    In 1996, the FDA approved the first emergency treatment for stroke 
based on data from an NINDS-supported clinical trial. Research in 
animal models, followed by clinical observations, had led the NINDS to 
design and initiate a clinical trial to evaluate tissue plasminogen 
activator (t-PA) as an emergency treatment to be used within three 
hours of the onset of the most common type of stroke--that due to a 
blockage of a major vessel. In the clinical trial, the drug, t-PA, was 
administered within three hours of a stroke so as to dissolve the 
offending clot and restore blood flow. The results show that t-PA 
increases a person's chances for a recovery with minimal or no 
disability by 30 percent when given within three hours.
    What all of these findings have done, has been to change the way 
physicians, scientists, and the public think about stroke. Stroke can 
be prevented in many cases, but when it occurs, like a heart attack, it 
is a medical emergency that requires quick action so as to begin 
treatment as soon as possible while the effects of the injury can still 
be reversed. This is just the beginning, however. As with many of the 
other brain disorders, such as epilepsy, Parkinson's disease, multiple 
sclerosis, and neurodevelopmental disorders in children, progress in 
stroke research is benefitting from advances in molecular biology, 
brain imaging, and other scientific fields. For example, by 
understanding how the brain reacts to stroke, scientists are trying to 
find ways that can protect the brain until t-PA or a similar treatment 
can restore the blood flow. These neuroprotective modalities still will 
have to be administered very rapidly, hopefully in the ambulance or 
first thing upon arrival in an emergency room so that as many brain 
cells can be protected as possible before there is irreversible damage. 
Several activities are under way to further progress in stroke 
research. NINDS has joined with several other institutes to encourage 
new research on ``Symptom Management for Chronic Neurological 
Conditions'' which may benefit survivors of stroke. NINDS also expects 
to fund additional clinical studies in stroke and has taken steps to 
encourage new clinical trials by making available planning grants for 
support for the design of a clinical trial and the organization of an 
effective research group. Also, in the development of the fiscal year 
1999 budget, I have included stroke research as an area of emphasis.
    Research on stroke is an excellent example of how opportunity and 
need have together produced a high level of return on our research 
investment. We are proud of the progress that has been made against 
stroke and pledge continued support to strengthening and advancing 
efforts in stroke research.
                chronic obstructive lung disease [copd]
    Question. Recent information collected by NIH shows that only two 
diseases over the past 30 years have shortened average life expectancy, 
HIV and COPD. Can you tell me what is being done at the National Heart, 
Lung, and Blood Institute (NHLBI) to address the public health 
implications of COPD, and what should Congress be doing to address the 
disease?
    Answer. Chronic Obstructive Pulmonary Disease (COPD), is a major 
public health burden in the United States; the major risk factor is 
cigarette smoking. The National Heart, Lung, and Blood Institute 
(NHLBI) considers research on COPD to be a high program priority and 
has devoted considerable resources to it. In addition to a significant 
research effort to study the basic mechanisms that lead to the lung 
damage that occurs in COPD patients, the Institute supports several 
clinical trials. Most noteworthy is the Lung Health Study, a project 
that is underway in ten clinical centers, which will follow individuals 
with early signs of COPD to learn more about the natural history of the 
disease process once it begins. The Institute also supports a study on 
the efficacy of lung volume reduction surgery in patients with advanced 
disease.
    Given the knowledge base that has been developed by NHLBI, coupled 
with new molecular technologies that have revolutionized biomedical 
research, the future holds great promise to learn even more about COPD 
and to translate these findings into programs that will have an impact 
on public health. For example, we believe that it is now possible to 
identify the genetic risk factors that predispose an individual to COPD 
and to lung cancer caused by smoking. The NHLBI will conduct a workshop 
this fall that will include epidemiologists, experts in pulmonary 
medicine, and those with experience in using molecular techniques to 
study large populations, as a first step in developing a long range 
program plan in this area. The NHLBI and the National Cancer Institute 
have also initiated discussions to develop programs to explore the 
relationship of COPD and lung cancer. These efforts will require 
significant input from the scientific community.
    Two public health initiatives from the NHLBI were initiated in 
1997. One, the National Lung Health Education Program, designed to 
develop strategies for early detection of lung damage through 
measurements of pulmonary function, represents a partnership with 
several major medical organizations. The other, global Strategy for 
Detection and Management of COPD, represents a cooperation with the 
World Health Organization to develop a comprehensive program of early 
detection (especially using lung function measurements), appropriate 
disease management strategies (for those with a diagnosis of COPD) and 
use of aggressive smoking cessation (and smoking avoidance) programs.
    Through this comprehensive program of research to examine 
mechanisms of lung damage, clinical research and outreach initiatives, 
with major new directions targeted to programs of primary prevention, 
the NIH is confident that more progress can be reported in the future 
to address the public health implications of COPD.
                            bipolar disorder
    Question. Last year's Senate Labor-HHS-Education Appropriations 
report called for a National Institute of Mental Health (NIMH) research 
plan on bipolar disorder. This request clearly indicates that, as you 
indicate publicly, there is too little bipolar illness research being 
funded by NIMH. This appears to be the case, particularly in the area 
of clinical research. As you know, bipolar disorder is among the most 
disabling of mental illnesses. The Subcommittee understands that NIMH 
has taken some steps to increase bipolar disorder research funding. 
Please describe what NIMH is doing as part of its current budget on 
manic-depressive illness research. How many new studies are being 
funded on this illness? What else, if anything, does NIMH intend to do 
to assure more research on bipolar disorder in fiscal year 1999 and 
beyond?
    Answer. NIH in general and NIMH, in particular, are committed to 
moving forward in research on bipolar disorder. Let me describe two 
major initiatives currently in progress for fiscal year 1998. First, in 
the NIMH Genetics Initiative, and as part of its effort to identify 
genetic factors in bipolar disorder, the Institute will continue to 
build up its national resource of DNA sample from patients and their 
family members. Second, we have issued a solicitation for a five year 
contract (``Treatment of Bipolar Disorder'') to launch a major public 
health study on ways to develop optimal treatment of bipolar disorder 
in adults and in geriatric populations. The study will assess the long-
term impact of different treatments on a broad range of clinical and 
functional outcomes. Data from this study will inform treatment 
practice in community settings. Other studies are examining treatments 
for adolescents with bipolar disorder. Furthermore, we intend to 
increase research on the neurobiological underpinnings of bipolar 
disorder as well as clinical, behavioral, and epidemiological work that 
will be useful in finding ways to prevent this disorder.
    At this time, it is not possible to predict how many studies on 
bipolar disorder will be funded in fiscal year 1999. This depends upon 
how many grant applications are submitted by independent investigators, 
and how scientifically sound and appropriate these applications are 
judged to be through the peer review process.
    As outlined above, NIMH intends to explore all avenues to increase 
research on bipolar disorder as rapidly as the growing fundamental 
science base allows scientifically rigorous research studies to be 
undertaken.
                         translational research
    Question. NIMH has frequently noted the need to support 
``translational'' research. However, for many policy-makers, patients, 
and families, the definition of translational research remains unclear. 
Would you describe for the Subcommittee what you mean by translational 
research? How does NIMH intend to implement this kind of research and 
make relevant to the advance of severe mental illness treatment? What 
specific programs and policies does NIMH intend to put forward to 
advance translational research?
    Answer. The term, translational research, is meant to describe a 
type of scientific inquiry that crosses usual conceptual and 
disciplinary boundaries. Historically NIH's support of biomedical 
research has focused on two major categories: basic biology and 
clinical research. Translational research seeks to translate ``back and 
forth'' between these two largely separate domains. It is anticipated 
that this will result in accelerated scientific progress that is 
directly applicable to clinical disorders. It is important to note that 
this is viewed as a bi-directional process, i.e., clinical research 
informing, as well as being informed by, basic research and vice-versa. 
A couple of examples may clarify the concept. Developmental 
neurobiology and genetics are both highly relevant to mental disorders. 
In both instances, hypotheses in clinical research are shaped by 
observations in basic research and vice-versa. The cognitive deficits 
observed in schizophrenia coupled with structural anomalies in the 
brains of schizophrenics have encouraged developmental neurobiologists 
to investigate the possible role of aberrant brain development in the 
etiology of schizophrenia. Conversely, the identification of a growing 
number of genes required for the precise specification of brain 
structure during development has given rise to clinical studies focused 
on the anatomic substrates of abnormal mental function. It is my belief 
that fostering translational research will enrich both basic and 
clinical research and will speed progress toward a complete 
understanding of mental disorders.
    Implementation of this kind of research will require a continuing, 
close collaboration between basic and clinical mental health 
researchers. NIMH has begun to develop and strengthen such 
collaborations in research through specific research support 
mechanisms. For example, several recently published NIMH program 
announcements call for the development of four types of research 
centers focused on translational research. One type of center, the 
Silvio O. Conte Centers for the Neuroscience of Mental Disorders, will 
support the integration and translation of basic and clinical 
neuroscience research on severe mental illnesses, while other centers 
will focus on related research areas.
    Translational research requires collaboration between scientists 
from multiple disciplines, an approach which, historically, has not 
been emphasized in research on mental illnesses. NIMH stimulates and 
sustains activity in translational research on severe mental illnesses 
through career-development mechanisms, which provide support for young 
clinical investigators during the formative stages of their careers 
until they become fully independent researchers. In addition, small 
grant awards provide support for pilot projects and for first-time 
grants for young NIMH investigators. These awards can be used to 
explore translational and other research studies that would be 
difficult to fund under traditional support mechanisms. In addition, an 
NIH-wide RFA, Clinical Research Curriculum Award, is intended to 
stimulate the inclusion of high-quality, multidisciplinary didactic 
training as part of the career development of clinical investigators.
                           clinical research
    Question. Failure of NIH to Respond: As you know, several members 
of the Labor/HHS/Education Appropriations Subcommittee are co-sponsors 
of the ``Clinical Research Enhancement Act'' based on the 
recommendations of a 1994 report of the Institute of Medicine (IOM). 
Over the past three years, the Subcommittee has raised serious concerns 
about the major obstacles confronting clinical research through which 
our investment in NIH's basic research efforts pay off with better 
patient care. Other than responding with modest intramural initiatives, 
the NIH has asked that the Subcommittee await a report from the 
Director's Panel on Clinical Research. Recently, that panel issued its 
report and made recommendations almost identical to those of the 
Institute of Medicine. Why didn't NIH just proceed with these 
initiatives three years ago when they were recommended by the IOM? And 
what does NIH plan to do immediately to rectify this situation and make 
up for lost time?
    Answer. As you stated, the ground work examining the state of our 
nation's clinical research enterprise was conducted by the Institute of 
Medicine (IOM). This study, which was carried out from 1991-1994 and 
was partially funded by NIH, addressed a number of the important issues 
concerning clinical research, including its role in the delivery of 
health care, the status of the clinical research infrastructure, and 
the need for well-trained clinical investigators. Although the 1994 IOM 
report was thorough and addressed a range of relevant issues, its 
recommendations were very broad and were aimed at both the private and 
public sector entities that sponsor, conduct, or, in some way, play a 
role in clinical research. These include accreditation and 
certification organizations, professional societies, universities, 
academic medical centers, industry, and the Federal Government.
    Because NIH is but one of these entities and has a unique role, I 
responded to the 1995 Appropriations Committee report language that 
requested NIH to act on the recommendations of the IOM report by 
convening the NIH Clinical Research Panel (CRP). That panel was charged 
with examining specifically the role of NIH in ensuring the health of 
the Nation's clinical research infrastructure. To this end, the CRP was 
asked to examine several important areas of NIH-supported clinical 
research including, but not limited to, the General Clinical Research 
Centers (GCRC's), the NIH Clinical Center (CC), the recruitment and 
training of future clinical researchers by NIH, the conduct of NIH-
sponsored clinical trials, and peer review of clinical research 
supported by the NIH.
    The CRP was also asked to deliberate on a number of issues that 
were not prominent concerns at the time of the IOM study, but reflect 
the rapidly changing clinical research environment today. These include 
the expansion of managed care, the emphasis on training primary care 
physicians, and the extensive transformation of the academic health 
care infrastructure.
    By the time the CRP report was completed in December 1997, a number 
of the panel's recommendations were already being implemented. The 
complete report is available on line at (http://www.nih.gov/news/crp/
97report/index.htm).
    NIH was implementing the recommendations of the Clinical Research 
Panel as they were brought forward. For example, the recommendation to 
track that part of the NIH budget devoted to clinical research was 
implemented by the creation of a prospective system to monitor the 
grants and other funds awarded which are devoted to clinical research. 
The recommendation to create a Clinical Research Training Program was 
implemented immediately. The creation of the new programs of career 
enhancing awards for clinical researchers continues this pattern.
    Question. Decline in Physician-Scientists: The number of first-time 
physician applicants for research project grants declined by 30 percent 
between 1994 and 1996. At that rate, we will have no new physician 
applicants by the year 2000. First, does this trend continue in 1997, 
and is the NIH alarmed by this stunning decline?
    Answer. We have noticed a reduction in the number of new physician 
applicants for NIH research grant support between 1994 and 1997. In 
1997, the NIH received 1,769 applications from individuals with the 
M.D. degree who had never received NIH research project grant support 
previously. This number is approximately the same as that observed in 
1996 and is 22 percent below the peak observed in fiscal 1994.
    To address this important issue, the NIH has recently announced new 
career award mechanisms designed to offer at least 80 young physicians 
new training opportunities in clinical research each year. This same 
initiative will also increase opportunities for mid-career clinical 
researchers who will serve as mentors. In addition, the initiative will 
support the development of high-quality instruction in clinical 
research methodology. We are hopeful that these new awards will 
ultimately increase the number of physicians submitting applications 
for clinical research grants. To provide some indication of the 
magnitude of this initiative, we estimate that, if all of the entry 
level awardees supported by the program apply for research projects 
grants after completing their career awards, there will be a greater 
than 10 percent increase in applications from physicians each year for 
several years into the future.
           funding for the general clinical research centers
    Question. The IOM and the Director's Panel on Clinical Research 
identified the General Clinical Research Centers (GCRC's) as a critical 
resource for patient-oriented research. Both reports recommended that 
these be funded more generously. The GCRC budget has declined as a 
proportion of the NIH budget from 3 percent in 1968 to 1 percent for 
the current year. Given all the obstacles and challenges confronting 
clinical investigation, shouldn't the lion's share of the funding 
increase for the National Center for Research Resources should be 
allocated to the GCRC's? Has the NIH considered using the NIH 
Director's discretionary fund or transfer authority for this purpose?
    Answer. There is no question that the General Clinical Research 
Centers (GCRC) are a critical resource for clinical research for NIH. 
We agree that it is important to support the GCRC's at a level required 
to permit appropriate patient oriented clinical research as supported 
by the NIH categoric institutes. The NIH commitment to do so is 
indicated by recent statistics. Between fiscal year 1993 and the fiscal 
year 1999 President's budget request, resources for GCRC's have grown 
about 43 percent, the same percentage increase as NIH as a whole, and 
the proportional relationship between the two has remained constant 
over that period. This reflects the condition of research as a whole, 
and the necessary balance between basic studies and the translation of 
research results to patients.
    I have no plans currently to use the Discretionary Fund or the 
transfer authority to increase funding for the General Clinical 
Research Centers. I believe that the level of funding requested for the 
GCRC's in the President's Budget is appropriate.
                                 ______
                                 
               Questions Submitted by Senator Larry Craig
                           nutrition research
    Question. I anticipate that NIH is involved in a great deal of 
research exploring the relationship between nutrition and various 
health conditions and diseases. Would you tell the committee about this 
research, which Institutes are involved, and any future plans for this 
important area of study?
    Answer. You are correct. Nutrition is one of the most widely cross-
cutting research areas at the National Institutes of Health (NIH). All 
of the Institutes, as well as the Clinical Center, the National Center 
for Research Resources, and several offices in the Office of the 
Director provide funding for nutrition research. This encompasses basic 
and clinical studies on the role of nutrients in health and disease. 
Nutrition research is coordinated across the NIH by the NIH Nutrition 
Coordinating Committee (NCC), which also has served to facilitate 
interactions relating to physical activity and health. The NCC includes 
liaison members from a number of other agencies of the Department of 
Health and Human Services, as well as from the Departments of 
Agriculture and Defense.
    By definition, nutrition research funded by the NIH includes 
studies to assess the consequences of food or nutrient intake and 
utilization in the intact organism, and the metabolic and behavioral 
mechanisms involved, including investigation of variables in nutrient 
intake at the cellular and subcellular level. The 17th Report of the 
NIH Program in Biomedical and Behavioral Nutrition Research and 
Training, published in January 1997, contains an extensive overview of 
recent nutrition research funded by the NIH. Numerous examples are 
cited, ranging from studies of the molecular genetics in the control of 
energy balance to research on the role of diet in lowering blood 
pressure to the effectiveness of nutrient support in cancer treatment 
to studies of nutritional factors in cognitive development and 
behavior. This report is available from the NIH Division of Nutrition 
Research Coordination, located in the National Institute of Diabetes 
and Digestive and Kidney Diseases (NIDDK).
    As far as future plans are concerned, each Institute at the NIH has 
plans that reflect the role of nutrition research in its overall 
programs. In addition, trans-NIH nutrition research efforts are led by 
the NCC. Currently, such initiatives include consideration of studies 
of the neuroendocrine basis of obesity, the prevention of obesity, and 
the role of physical activity and nutrition in health. These reflect 
the interest of many NIH Institutes in obesity as an underlying cause 
of disease, and the recognition that progress in obesity research has 
tremendous potential to improve public health.
    Question. Within NIH, is there a single ``advisory committee,'' or 
some other coordinating entity responsible for overseeing nutrition-
related research? If not, do you think the Institutes could benefit 
from the establishment of such an entity?
    Answer. Yes, the NIH Nutrition Coordinating Committee (NCC) 
facilitates communications regarding nutrition research, both among the 
NIH institutes and with liaison agencies in the Departments of Health 
and Human Services, Agriculture, and Defense. This body has been 
responsible for the development of several trans-NIH nutrition research 
initiatives. The NCC is administered within the National Institute of 
Diabetes and Digestive and Kidney Diseases' Division of Nutrition 
Research Coordination, which represents the NIH on numerous other 
interagency committees concerning nutritional issues.
    I think the NCC is doing a good job. It has been quite active in 
fostering nutrition research at the NIH and in involving other Federal 
agencies in this area. Currently a number of the NIH Institutes, as 
well as the Centers for Disease Control and Prevention (CDC) and the 
Department of Defense, are working through the NCC to develop trans-NIH 
initiatives in obesity research.
    Question. To what extent do health professionals with nutrition 
expertise advise NIH on its research activities and funding priorities? 
How many registered dietitians and other nutrition professionals serve 
on NIH advisory committees and review panels? Could you tell us on 
which panels they serve?
    Answer. Nutrition research is widely dispersed throughout all of 
the NIH Institutes, reflecting the interdisciplinary nature of this 
field. Nutrition researchers are essential in advising NIH by serving 
on Institute advisory councils, participating in workshops, and on peer 
review groups and through dialog between professional societies and the 
NIH. I cannot provide you with an exact number of nutrition advisors to 
the NIH, because most nutrition researchers are not organizationally 
located in nutrition departments. In addition, most registered 
dieticians (RD) involved in research cite higher degrees and do not 
necessarily inform us that they have RD degrees.
    Some examples of representation of nutritionists in NIH activities 
are: The NIDDK-sponsored National Task Force on Prevention and 
Treatment of Obesity comprises primarily nutrition researchers. The 
NIDDK always includes a member of the nutrition research community on 
its advisory council and also has an exofficio representative from the 
Beltsville Human Nutrition Research Center of the Department of 
Agriculture. The National Heart Lung and Blood Institute (NHLBI) Expert 
Panel to Develop Clinical Guidelines on the Identification, Evaluation, 
and Treatment of Overweight and Obesity in Adults comprises people of 
different expertise, however most have been involved in some aspect of 
nutrition related research. The NHLBI advisory council currently 
includes a nutrition researcher who also is an epidemiologist and has a 
Ph.D., M.P.H., and R.D. degrees. Nutritionists and registered 
dietitians are represented as advisors on NHLBI's national education 
programs including the Coordinating Committees of the National 
Cholesterol Education Program and the National High Blood Pressure 
Education Program. They play important roles in advising these programs 
on a variety of educational programs on nutrition-related strategies 
and materials, including those targeting special populations.
    Regarding the peer review of nutrition, a considerable body of 
nutrition research is reviewed in the Nutrition Study Section, whose 
members are primarily nutrition researchers. However, nutrition 
research also is widely reviewed in a large number of other study 
sections, due to its interdisciplinary nature. This dispersal ensures 
the best review for each particular application.
                                diabetes
    Question. Dr. Varmus, diabetes impacts the very young as well as 
older Americans. I know that NIDDK leads diabetes research. What roles 
do other institutes, such as the National Institute of Child Health and 
Human Development (NICHD) and the National Institute on Aging (NIA), 
have for diabetes given the impact the disease has on their key 
constituencies? What is the role of other institutes which oversee 
areas where diabetes causes devastating complications, such as 
blindness, heart disease, stroke, and amputations?
    Answer. The NICHD has a broad program of research in diabetes. 
Diabetes is the most common endocrine disorder that occurs during human 
gestation. With the introduction of insulin therapy and the 
implementation of rigorous glucose control, the incidence of maternal 
and fetal mortality has been reduced to that observed in the general 
obstetric population whose members have normal glucose tolerance. 
However, subtle morbidities persist. A longitudinal study aims at 
clarifying changes in maternal carbohydrate metabolism in women with 
gestational diabetes (GDM) in early and late gestation. These women are 
at risk of developing type 2 diabetes over the two to three decades 
after their pregnancies. This explains the importance of pursuing a 
longitudinal study. In addition, the knowledge acquired will lead to 
improvements in the diagnosis and treatment of GDM, based on the 
understanding of the pathophysiology of the disorder.
    Other research supported by the NICHD is aimed at understanding the 
genetic and environmental causes of disease in order to develop 
strategies to prevent both type 1 and type 2 diabetes. By supporting 
immunogenetic research in multiply-affected families, the NICHD played 
a key role in discovering that type 1 diabetes is an autoimmune 
disease. The NICHD built on this discovery by providing partial support 
for the world's largest, most comprehensive study of the natural 
history of type 1 diabetes, the NIDDK's Diabetes Control and 
Complications Study. A major accomplishment of this ongoing study has 
been to enable doctors to predict the rate of conversion from having no 
disease to clinical diabetes in close relatives of type 1 diabetics. 
This important advance paved the way for the Diabetes Prevention Trial-
1, supported by the NIDDK, NICHD, and NIAID, which is designed to delay 
or prevent the onset of type 1 diabetes by attenuating the body's 
autoimmune attack on the beta cells of the pancreatic islets.
    The NIA is collaborating with the NIDDK on new research initiatives 
on the prevention and treatment of diabetic complications. Specific 
areas of interest to the NIA include: (1) age-related changes in 
pancreatic cell function (e.g., altered insulin production or 
response), and (2) implications of age-related physiologic changes on 
the rates of progression of complications in older people with type 1 
diabetes.
    Type 2 diabetes and its cardiovascular complications (e.g., 
atherosclerosis, hypertension) pose a significant health problem to 
older adults, yet the processes involved in the development of diabetic 
complications are not clearly understood. Ongoing NIA-supported 
research has been examining the role of impaired glucose metabolism and 
insulin resistance in the development of vascular problems associated 
with diabetes. Moreover, NIA scientists are studying 2,000 of the 
participants in the Baltimore Longitudinal Study of Aging to address 
the question of whether complications of diabetes occur at comparable 
plasma glucose levels in younger and older individuals and to determine 
the incidence rates for overt clinical diabetes, coronary heart 
disease, stroke, and mortality among these aging persons.
    The majority of diabetic patients suffer from, and ultimately 
succumb to, some form of cardiovascular disease (CVD) such as heart 
attack, stroke, congestive heart failure, and peripheral vascular 
disease, but why diabetes causes excess CVD and how such complications 
can best be prevented is not well understood. The NHLBI supports a 
range of studies to understand the basic mechanisms underlying this 
propensity of diabetes to develop CVD and the reasons why other CVD 
risk factors (e.g., high blood pressure, dyslipidemia) tend to co-occur 
with diabetes. The Institute also conducts trials of CVD treatments, 
such as revascularization procedures, to identify the best approaches 
to be used in diabetics. On the horizon are new approaches to therapy 
that may facilitate glucose control and lead to a lower risk of CVD 
complications. These new avenues are being pursued vigorously.
    The National Eye Institute (NEI) has an extensive portfolio of 
diabetes-related research, and is an active participant in the NIH 
diabetes initiative. One area of particular priority is the study of 
diabetic retinopathy, which is often associated with the growth of 
abnormal new blood vessels (neovascularization). Recent work has 
identified several agents involved with retinal neovascularization. 
Vascular endothelial growth factor (VEGF) and pituitary gland factors, 
such as growth hormone and insulin-like growth factor-1, are possible 
causative agents. Systemic inhibition of these substances may have 
therapeutic potential.
    Other diabetes research that the NEI is pursuing is related to the 
role of protein kinase C (PKC) in retinal neovascularization. VEGF 
functions by binding to receptors on the surface of cells lining the 
retinal blood vessels. This can result in activation of an 
intracellular signaling pathway involving PKC. An orally-administered 
inhibitor of PKC has been developed and has been shown to be effective 
in improving retinal blood circulation and in preventing the growth of 
blood vessel cells under laboratory conditions. The NEI is working with 
the pharmaceutical industry to set up human clinical trials of this 
inhibitor.
    Diabetes is the most common cause of peripheral neuropathy (nerve 
damage) in the United States, a complication that affect about 60 
percent of people with the disease. The National Institute of 
Neurological Disorders and Stroke (NINDS) supports studies of the 
neurological complications of diabetes. This work includes research 
into the possible causes of neuropathy, including the role of 
deficiencies in neurotrophic factors. Other studies focus on the 
mechanisms underlying the pain that characterizes diabetic neuropathy.
                  primary pulmonary hypertension [pph]
    Question. Primary pulmonary hypertension (PPH) is a rare, 
progressive, and fatal heart/lung disease that strikes mostly females. 
Following report language in the fiscal year 1996 NIH Appropriations 
bill, a program announcement was issued encouraging researchers in 
primary pulmonary hypertension to submit proposals. How many have you 
received and how many are being funded? If few have been received and/
or funded, how can this be rectified?
    Answer. The study of primary pulmonary hypertension is a high 
priority for the NHLBI, and it supports several projects related to 
this disease. The program announcement ``Cellular and Molecular 
Mechanisms of Primary Pulmonary Hypertension'' resulted in 12 
applications to date. One new project has been funded and three 
additional projects which are highly meritorious scientifically will be 
reviewed at the May 1998 meeting of the National Heart, Lung, and Blood 
Advisory Council. Three applications will be reviewed at study section 
meetings in June. The new projects in response to this announcement 
will address innovative and creative approaches to this devastating 
disease.
    We will evaluate the success of the program announcement after we 
have had a chance to see how many additional applications are submitted 
during the remainder of this calendar year. The pulmonary research 
community has shown an increased level of interest in this disease. If 
only a small number of applications are available, we will consider 
other mechanisms to stimulate high quality research in this important 
area of lung research.
    Question. Although progress has been made in this area, there are 
no animal models of PPH. This is typically a necessity for research 
proposals to be deemed worthy. How are allowances made for this problem 
and how well versed in this rare disease are the scientists who read 
and rate the PPH proposals?
    Answer. Although there is no single animal model that mimics 
primary pulmonary hypertension in its entirety, there are a number of 
animal models that have been used for many years to study pulmonary 
hypertension in general. Information gained from these studies is 
providing new understanding of how the pulmonary circulation is 
controlled and what might go wrong in PPH. In addition, genetically 
altered animals are now being used to study pulmonary hypertension. One 
of the objectives of the program announcement discussed previously is 
the development of an animal model that mimics PPH.
    We feel there is adequate expertise on the study sections to review 
the applications. In fact, the current chairman of the study section 
that reviews most of the PPH applications has spent his entire research 
career working on pulmonary hypertension. In addition, when it is felt 
that there is not appropriate expertise to review a particular 
application among the regular study section members, special ad hoc 
members are invited to do the review.
    Question. One of the drugs, prostacyclin, used to treat PPH is 
extremely expensive. One estimate places the cost of the drug alone at 
an average of $5,000 monthly for each of the 1,000 patients nation-wide 
on this drug--a bill of $5,000 monthly and $60,000,000 yearly for these 
patients. How is NIH supporting or planning to support research to find 
an effective treatment that is manageable cost-wise for the PPH victims 
and the American public?
    Answer. The focus at NIH is aimed at supporting basic research 
projects to determine the fundamental cellular and molecular factors 
underlying the disease. It was through such projects, leading to an 
understanding of the basic mechanisms that regulate the pulmonary 
circulation, that the drug, prostacyclin, was discovered to be useful 
in PPH. We believe that further investigations into pulmonary vascular 
biology, including the role of nitric oxide in regulating pulmonary 
vessels, and the role that genetic factors may play in the familial 
form of PPH, will eventually lead to new approaches and strategies for 
treating PPH.
                                 ______
                                 
               Questions Submitted by Senator Tom Harkin
                      behavioral science research
    Question. Dr. Varmus, this Committee remains very interested in 
behavioral science research at NIH. Over many years, we have encouraged 
NIH to pay significant attention to health problems that involve 
behavior, either as a cause or as a symptom.
    For example, smoking is a behavior that leads to cancer, emphysema 
and other diseases. Illegal drug use is a behavior that leads to AIDS 
and other diseases. Of course we need research on cancer, emphysema and 
AIDS, but we also need research on the behaviors themselves. What leads 
young people to take up smoking or to start abusing drugs? What can we 
do to discourage these behaviors? Or, to take other examples, are there 
effective interventions to discourage unhealthy behaviors like 
violence, child abuse, and teen pregnancy?
    Answer. Tobacco use usually begins in early adolescence, typically 
by age 16. Almost all first time tobacco use occurs before young people 
graduate from high school. If adolescents can be kept tobacco-free, 
most will remain tobacco-free for the rest of their lives.
    Almost all adolescents will, at some time, feel pressured to try 
tobacco. Peers, siblings, and friends are powerful influences. The most 
common situation in which a cigarette is tried is when a young person 
is with a friend who already smokes. Particularly susceptible to peer 
influences are adolescents who lack parental support and involvement in 
their lives.
    Young people are sensitive to perceived signals that smoking is the 
norm. These include visible public smoking, the availability of 
cigarettes to minors, and the widespread promotion and advertising of 
tobacco products. Cigarette advertising appears to increase young 
peoples' risk of smoking by conveying the message that smoking has 
social benefits and that it is far more common than it really is.
    Young people may be repeatedly exposed to outdoor billboards 
portraying apparent benefits of tobacco use, especially in inner-city 
neighborhoods. Increasingly, tobacco companies market their products 
through promotional activities that reach youth. Cigarette ads visually 
associate smoking with independence, adventure-seeking, and physical 
attractiveness--themes that appeal to young people. Young people with 
low self-esteem are particularly receptive to this message.
    Young people who come from a low-income family and have fewer than 
two adults living in their household are especially at risk for 
becoming smokers. Female and male adolescents are now equally likely to 
smoke, but male adolescents are substantially more likely than females 
to use smokeless tobacco products. White adolescents are more likely to 
smoke and to use smokeless tobacco than are black and Hispanic 
adolescents. Insufficient knowledge of the health consequences of 
smokeless tobacco use is also a factor.
    Behavioral risk factors for tobacco use include low levels of 
academic achievement and of involvement in school activities, and lack 
of skills required to resist influences to use tobacco.
    The National Institute on Drug Abuse (NIDA) recently issued a 
research-based guide to preventing drug use among children and 
adolescents. Researchers have identified many risk factors, each of 
which represents a challenge to the psychological and social 
development of an individual. While many people mistakenly believe that 
``the drug problem'' emerges during adolescence, research conducted 
over several decades has made it clear that drug use in adolescence has 
much earlier roots. Factors that affect early development of children 
in the family are probably the most crucial, such as: chaotic home 
environments, particularly those in which parents abuse substances or 
suffer from mental illnesses; ineffective parenting, especially of 
children with difficult temperaments and conduct disorders; and lack of 
mutual attachments and nurturing. Other risk factors include 
inappropriately shy and aggressive behavior in the classroom; failure 
in school performance; poor social coping skills; affiliations with 
deviant peers; and perceptions regarding approval of drug-using 
behaviors in the school, peer, and community environments.
    The development of prevention programs provides knowledge of which 
protective factors make it less likely that young people will use 
drugs. The most salient protective factors include strong bonds within 
the family; parental monitoring with clear rules of conduct within the 
family unit and involvement of parents in the lives of their children; 
success in school performance; strong bonds with prosocial institutions 
such as the family, school, and religious organizations; and adoption 
of conventional norms about drug use.
    In addition, the availability of drugs, trafficking patterns, and 
beliefs that drug use is generally tolerated also influence the number 
of young people who start to use drugs.
    Studies have shown that educational efforts can effectively reduce 
the onset of tobacco use among adolescents. Promising results have been 
seen in school-based programs that teach young people how to resist 
social influences to smoke. School-based smoking-prevention programs 
that identify social influences to smoke and teach skills to resist 
those influences have demonstrated consistent and significant 
reductions in adolescent smoking prevalence, and effects have lasted 
one to three years. Programs to prevent smokeless tobacco use that are 
based on the same model have also demonstrated modest reductions in the 
initiation of tobacco use.
    Such programs are even more successful when they are supported in 
both the adolescent's home and community. The effectiveness of school-
based smoking-prevention programs appears to be enhanced and sustained 
by comprehensive school health education and by community-wide programs 
that involve parents, the mass media, community organizations, or other 
elements of an adolescent's social environment.
    Though school-based anti-smoking programs can be effective, more 
aggressive measures also appear to be needed. Raising the price of 
cigarettes appears to discourage youth from trying tobacco. Econometric 
studies indicate that increases in the real price of cigarettes 
significantly reduce cigarette smoking among both young people and 
adults.
    Also effective are strongly enforced laws that prohibit the sale of 
tobacco to young people, and policies in the school, workplace, and 
community that restrict smoking. A crucial element of prevention is 
access: adolescents should not be able to purchase tobacco products in 
their communities. Active enforcement of age-at-sale policies by public 
officials and community members appears necessary to prevent minors' 
access to tobacco. Communities that have adopted tighter restrictions 
have achieved reductions in purchases by minors.
    A 1994 report from a committee of the Institute of Medicine, 
Growing Up Tobacco Free: Preventing Nicotine Addiction in Children and 
Youths, recommends tougher regulation of tobacco ads so that all 
features of advertisements and promotions that appeal to youths and 
influence them to use tobacco are eliminated. In addition, the report 
indicates that governments and private organizations should reinforce 
the emerging view of smoking as an unaccepted behavior. Other programs, 
such as paid anti-smoking advertisements, and smoke-free zones in 
schools and workplaces, can help generate a ``tobacco-free norm.'' The 
IOM report also recommends that support for research on tobacco use by 
children and adolescents be increased, including studies of smoking 
trends among different ethnic groups.
    Concerning drug use, effective prevention programs have been 
carried out which make use of family relationships, peer relationships, 
the school environment, and the community environment. The most 
effective programs involve all of these for sustained periods of time.
    Since the most vulnerable periods for drug use among youth are 
transitions, between one developmental stage to another, or when there 
are difficult life changes, prevention programs often are designed for 
particular transition periods.
    While none of the prevention programs tested so far have eliminated 
drug use among young people, a variety of programs have demonstrated 
substantial reductions in use or delayed onset of use, both of which 
are important outcomes in terms of the long-term burdens of drug use.
    The NIH has had a longstanding program of research on aggressive 
and violent behavior in children and youth so I will focus the major 
part of my comments on this topic.
    It has been shown that the best hope for high-risk children is to 
interrupt the development of the pattern of violence early on. 
Researchers funded by the NIMH are studying interventions for young 
children designed to prevent serious behavior problems from developing. 
While preventive interventions aimed at single risk factors, have had 
only modest and short-lived effects, more promising are programs that 
are coordinated and long-term. NIMH studies suggest that these programs 
should span the first several years of school, with particularly 
intensive interventions during the transitions, such as school entry 
and from elementary to middle school. NIMH is now testing models of 
early prevention that are aimed at improving the lives of high-risk 
children in multiple domains, by not only teaching the children better 
coping skills, but by also training their teachers and parents in the 
skills and knowledge that will improve the environments in which these 
children live. Communities also have participated in the intervention 
planning and delivery.
    Other NIMH research focuses on interventions targeted toward older 
youth who display chronic serious aggressive behavior. Once a chronic 
pattern of aggressive behavior is established, it is highly resistant 
to change. In contrast to the generally ineffective, punitive 
interventions for youth delinquency, several NIMH funded interventions 
have had success in preventing delinquent behavior to become chronic in 
at-risk and seriously troubled youth. One of the most promising 
approaches is the Specialized Foster Care (SFC) Program. The SFC model 
provides the opportunity for intensive, individualized treatment in a 
nonrestrictive family setting. This type of foster care is an enhanced 
by providing the foster parents with substantial training in intensive 
monitoring, consistent discipline, and positive reinforcement.
    The SFC program was based on NIH research findings which showed 
that at-risk and delinquent youths should not be grouped together 
during treatment. Instead, these youth should be isolated as much as 
possible from each other, while maximizing their interaction with pro-
social youth and with adults who have received special training. In 
comparison to the usual group care arrangements, therapeutic foster 
care has resulted in half as many self-reported offenses, fewer 
runaways, and half the number of arrests, in the 18 month period 
following placement. While other programs targeting this population 
have failed to produce lasting results, this type of foster care was 
able to sustain its positive effects, with reductions in serious 
delinquency persisting for at least one year after the intervention 
ended. During the past decade an increasing number of Specialized 
Foster Care programs have been setup. In addition to successful 
intervention, therapeutic foster care has demonstrated a significant 
cost savings, approximately $2,000 less per month than the cost of 
group care.
    While much progress has been made in the area of research on youth 
violence research, a 1998 National Research Council report ``Violence 
in Families: Assessing Prevention and Treatment Programs,'' noted that 
very little intervention research has been conducted on family 
violence. A recent NIH initiative is designed to help address this gap. 
Entitled ``Violence against Women and Violence within the Family, this 
Request for Applications (RFA) encouraged research on the abuse of 
children and the elderly, partner violence, sexual violence, and 
multiple episodes of family violence. This trans-NIH funding program to 
focus on violence was coordinated by the Office of Behavioral and 
Social Science Research (OBSSR) and co-sponsored by five NIH institutes 
and two other NIH Offices, in collaboration with the National Institute 
of Justice (NIJ), the National Center on Child Abuse and Neglect, and 
the Centers for Disease Control and Prevention (CDC).
    Ten research grants were awarded and include studies of 
interventions for treating domestic abuse in Latino families, 
protecting battered women, healing the children of battered women, 
preventing abuse of the elderly by care givers, and treating violent 
adolescent males from abusive homes.
    Effective programs to prevent teenage pregnancy have been shown to 
share several common characteristics. First, they clearly focus on 
reducing one or more sexual behaviors that lead to unintended 
pregnancy. They propose a small number of specific behavioral goals, 
such as delaying the initiation of sexual activity, use of 
contraception, and providing a clear message by continually reinforcing 
a strong stance on these behaviors. Next, the behavioral goals, 
teaching methods and materials must be appropriate to the age, sexual 
experience, and culture of the students. Third, effective programs must 
be based on solid theoretical approaches previously shown to be 
effective in influencing other health-related risky behaviors. Fourth, 
effective programs should continue long enough to complete their 
planned activities. Fifth, teaching methods should provide personalized 
messages while giving accurate information about the risks of 
unprotected intercourse and the ways of avoiding it. They must address 
the social pressures that adolescents experience and teach and practice 
of communications, negotiation, and refusal skills. Finally, effective 
programs must have teachers or peers who believe in the programs and 
then provide appropriate training for them.
    Question. In addition to understanding behavior as a cause of 
disease, we need to better understand behavior as a symptom. For 
example, NIH should look into the behavioral consequences of dementia 
and other neurological or mental disorders.
    In light of the clear connection between behavior and health, what 
recent steps have you taken to encourage basic and applied behavioral 
research at NIH? In your view how well is the Office of Behavioral and 
Social Science Research integrated into the work of NIH?
    Answer. Many such efforts are underway at NIH. For example, the NIH 
Office of Behavioral and Social Science Research (OBSSR) recently 
announced a special trans-NIH, interagency Request for Applications 
(RFA) focusing on ``Innovative Approaches to Disease Prevention through 
Behavior Change.'' The RFA invites applications to test interventions 
designed to achieve long-term health behavior change. The health 
behaviors of interest--tobacco use, physical inactivity, improper diet, 
and alcohol abuse--are among the top ten causes for premature mortality 
and morbidity. The initiative is being co sponsored by four other NIH 
Offices and 11 NIH Institutes, with additional funding from the 
American Heart Association.
    Another recent OBSSR RFA was designed to help build the research 
capacity of the behavioral and social sciences. In collaboration with 
the National Center for Research Resources (NCRR), National Institute 
of Nursing Research (NINR), National Institute on Drug Abuse (NIDA), 
and National Institute of Dental Research (NIDR), the OBSSR sponsored a 
request for applications for ``Educational Workshops in 
Interdisciplinary Research.'' This RFA invited grant applications to 
develop and conduct short-term educational workshops in 
interdisciplinary research. Designed to foster cross-disciplinary 
communication and research collaborations, the RFA emphasized 
facilitating the integration of different fields of social and 
behavioral sciences research and/or the integration of these areas with 
the more biological fields. Ten projects were supported under this 
initiative. Because it was so successful, the OBSSR expects to reissue 
the RFA in fiscal year 1999, with participation from several additional 
NIH Institutes.
    Another trans-NIH initiative, cosponsored by eight institutes and 
three offices of the NIH, is a program announcement (PA) entitled 
``Methodology and Measurement in the Behavioral and Social Sciences.'' 
This just-issued PA encourages research on methodology and measurement, 
in order to improve the quality and scientific power of data collected 
in the behavioral and social sciences.
    The National Cancer Institute (NCI), in conjunction with the 
National Institute of Child Health and Development (NICHD), NIDA, NIDR, 
the National Institute of Mental Health (NIMH), and NINR, has issued an 
Request for Applications (RFA) for grants applications to study 
interventions for ``Prevention and Cessation of Tobacco Use by Children 
and Youth in the U.S.''
    In addition to these trans-NIH activities, projects are also 
underway at the individual NIH Institutes to encourage basic and 
applied behavioral research.
  --NIA's program announcement ``Social Cognition and Aging'' invites 
        basic research and training grant applications to study how 
        representations of social events, societal and cultural norms 
        and personal characteristics influence behavior, reasoning, 
        emotion and motivation.
  --NHLBI's ``Nutrition Academic Award'' encourages the enhancement of 
        medical school curricula to increase opportunities for 
        students, house staff, faculty, and practicing physicians to 
        learn nutrition principles and clinical practice skills with an 
        emphasis on preventing cardiovascular diseases.
  --One of NIAAA's recent RFA's, seeks to stimulate assessments of 
        alcohol-related HIV preventive interventions that have the 
        potential for reducing the risk of transmission of HIV in 
        alcohol using, abusing, and dependent populations. Other NIAAA 
        RFA's encourage research to examine the ``Effects of Alcohol 
        Advertising on Underage Drinking,'' as well as studies of the 
        efficacy of ``Treatment for Adolescent Alcohol Abuse and 
        Alcoholism.''
  --NICHD recently offered an RFA to continue the ``Family and Child 
        Well-being Research Network'' cooperative agreements 
        investigating the relationship of family factors to child 
        welfare.
  --Under its new RFA, ``Mental Health Research for Survivors of 
        Torture and Related Trauma,'' the NIMH is inviting grant 
        applications for research on the extent and nature of mental 
        health problems related to torture within the U.S., and on the 
        effectiveness of interventions for survivors of torture.
  --Because benefits from combination medication regimens for HIV can 
        be sustained only if rigorous adherence to precise dosing 
        requirements is maintained, NINR's program announcement, `` 
        Understanding and Improving Antiretroviral Regimen Adherence,'' 
        encourages research on factors influencing adherence and 
        nonadherence, and on methods to improve and assure adherence 
        and compliance to drug therapy regimens for HIV.
  --A recent NIMH program announcement invites applications for 
        ``Centers for Behavioral Science Research in Mental Health.'' 
        The purpose of these Centers is to provide integrated multi 
        disciplinary research environments in which to pursue questions 
        focused on basic behavioral science related to mental health 
        and mental disorders. NIMH also has a program announcement, 
        ``Specialized Mental Health Intervention Research Centers,'' 
        designed to provide the scientific infrastructure to facilitate 
        assessment of treatments for major mental disorders, and of the 
        preventive and rehabilitative interventions related to those 
        treatments.
  --In partnership with NINDS and the National Down Syndrome Society, 
        NICHD is inviting research grant applications that address 
        various aspects of cognition and behavior in individuals with 
        Down Syndrome (DS). Areas of interest include the developmental 
        and neurological mechanisms underlying characteristic loss of 
        function, approaches toward preserving or improving level of 
        function, and methods to assess the effects of various 
        interventions.
  --NIDCD has a new program announcement for studies on the assessment 
        of the efficacy of behavioral treatments, as well as the use of 
        computational neuroscience models and other new approaches to 
        investigate higher cognitive functions in communication, such 
        as perception, discrimination, plasticity, multisensory 
        integration, learning, language and memory.
    As you know, Congress established the Office of Behavioral and 
Social Sciences Research (OBSSR) to facilitate the growth and 
development of health-related behavioral and social sciences research 
at the NIH. Although the office is relatively new, I believe the OBSSR, 
under the direction of Dr. Norman Anderson, has made significant 
progress in fulfilling its trans-institute mission.
    The OBSSR has initiated several activities that integrate 
behavioral and social science into the overall work and mission of the 
NIH. One of the first tasks it undertook was to establish a definition 
of behavioral and social science research that could be used 
consistently across the institutes so as to assess and monitor progress 
in this area. This definition is now used across all of the institutes 
to report funding in behavioral and social sciences.
    Developing initiatives designed to stimulate research in the 
behavioral and social sciences at NIH has been a major activity of the 
OBSSR. The office works very closely with the institutes to encourage 
them to enhance their behavioral and social sciences research 
portfolios. To date, the OBSSR has facilitated four trans-NIH 
collaborations including RFA's on Family Violence; Interdisciplinary 
Training Workshops; Strategies for Health Behavior Change; and a 
Program Announcement that encourages proposals for methodological 
research. Because this is such an important role for the OBSSR, and to 
ensure that the NIH is addressing the most critical behavioral and 
social science questions, I have asked Dr. Anderson, the Director of 
OBSSR, to begin a formal process to establish priorities for research 
in behavioral and social sciences. These priorities will be established 
with input from a wide constituency of scientists, advocacy 
organizations, and the public. This assessment will then be used to 
assist the OBSSR as it works with the institutes to increase their 
funding of behavioral and social science.
    The OBSSR has also sponsored conferences and established working 
groups that have the wide participation of NIH institutes and centers. 
For example, the Science of Self-Report Conference addressed an issue 
of immense interest to all of the institutes. Because of the demand for 
information on this topic, the conference proceedings will be published 
this year. Currently, the OBSSR, in collaboration with the Office of 
Disease Prevention, is organizing a conference on prevention to be held 
this fall. Entitled, ``The Science of Prevention: Contributions from 
Behavioral and Social Research'' the conference will report on NIH 
research that demonstrates how behavioral and social programs can 
prevent health problems, can make it less likely that such problems 
will develop among high-risk individuals, and can assist in the 
management of chronic health problems so that relapse is less likely.
    NIH Working Groups are integral to cross-institute collaboration, 
and the OBSSR has organized and/or participated in several, including 
the Child Abuse and Neglect Working Group and the Working Group on 
Psychoneuroimmunological Research. Most recently, the OBSSR has 
organized a Working Group on the Behavioral Assessment of Transgenic 
Animals to devise a comprehensive, standardized battery of behavioral 
tests for examining such animals. Currently, no comprehensive battery 
of tests exists which severely limits their use in the study of 
diseases such as Alzheimer's disease, schizophrenia, and depression.
    I know you are aware of the efforts NIH has been making to refine 
our peer review system, and to integrate the review of grant 
applications from the former ADAMHA institutes into the reviews done by 
the Center for Scientific Review (CSR). The OBSSR is playing an 
integral role in this endeavor, organizing and chairing a special 
working group, the NIH Behavioral and Social Sciences Review 
Integration Working Group. The goals of this group are: to assure that 
the study sections in the fields of behavioral and social science 
reflect the current state-of-the-science; to create a structure that 
can adapt to future developments in science: and, to ensure high 
quality peer review that identifies the most meritorious applications.
    Another measure of how well the OBSSR is integrated into the work 
of NIH has to do with my appointment of Dr. Anderson to critical NIH 
committees. For example, because of the importance of the perspective 
of OBSSR, I have appointed Dr. Anderson to the search committees for 
the Directors of NIMH, the National Institute of Neurological Disorders 
and Stroke, and National Institute of Deafness and Other Communication 
Disorders. In addition, Dr. Anderson serves on the Peer Review 
Oversight Committee (PROG), which is charged with evaluating the peer 
review process across NIH.
    Finally, in order for me to be better informed about this important 
field, I have asked Dr. Anderson to organize periodic briefings for me 
on new developments in research on behavioral and social sciences.
                           research training
    Question. As you know, the National Academy of Sciences has 
proposed detailed recommendations regarding training of researchers 
under the National Research Service Awards program. Among its 
suggestions, the Academy urged NIH to increase training awards in the 
fields of behavioral science, health services research, nursing, and 
oral health.
    What steps, if any, has NIH taken to implement the recommendations 
of the National Academy of Sciences?
    Answer. In its 1994 report Meeting the Nation's Needs for 
Biomedical and Behavioral Scientists, the National Academy of Sciences 
(NAS) recommended an increase in the number of National Research 
Service Award (NRSA) training positions in the areas of behavioral 
science, nursing research, oral health research, and health services 
research. In the same report, the NAS also recommended a substantial 
increase in NRSA stipends, which was considered to have priority over 
increases in numbers of training positions. Within the fiscal year 1997 
and 1998 budgets NIH was able to provide small stipend increases for 
predoctoral trainees and postdoctoral fellows having up to one year of 
previous experience. Once stipend levels are increased, the NIH focus 
on the need for increased training positions in the fields of 
behavioral science, health service research, nursing and oral health. 
The NIH has also asked the NAS, in its new study to help identify 
scientific fields which will benefit from increased training support. 
In the course of this study, the eleventh in the series of 
Congressionally mandated studies of the NIH training program, the NAS 
will be reviewing human resource needs in all biomedical and behavioral 
fields and will report its findings and recommendations shortly after 
the end of this calendar year. The fiscal year 1999 President's Budget 
requests an increase of 25 percent in stipends over fiscal year 1998 
levels.
                           clinical research
    Question. Failure of NIH to Respond: As you know, in 1994, the 
Institute of Medicine published a report expressing concern about the 
decline of clinical research in this country. Over the past three 
years, this Subcommittee has raised serious concerns about the major 
obstacles confronting clinical research through which our investment in 
NIH's basic research efforts pays off with better patient care. Other 
than responding with modest intramural initiatives, you have asked that 
we await a report from your advisory panel on clinical research. 
Recently, that panel issued its report and, made recommendations almost 
identical to those of the IOM. Dr. Varmus, what do you plan to do to 
rectify this situation and make up for lost time?
    Answer. Although many of the final recommendations overlapped with 
those directed in the IOM report, the recommendations from the Clinical 
Research Panel, which I appointed, extended the recommendations of the 
IOM report.
    NIH did not wait to implement the recommendations of the Clinical 
Research Panel until it completed its work in 1997. Recommendations 
were addressed as they were brought forward by the Panel. For example, 
the recommendation to track that part of the NIH budget devoted to 
clinical research was implemented by the creation of a prospective 
system to monitor the grants and other awarded funds devoted to 
clinical research. The recommendation to create a Clinical Research 
Training Program was implemented immediately. The creation of the new 
program of career enhancing awards for clinical researchers continues 
this pattern.
    Question. Decline of Physicians: It is my understanding that the 
number of first-time physician applicants for research projects grants 
declined by 30 percent between 1994 and 1996? First, can you tell us 
whether this trend continued in 1997, and your reaction to this 
decline?
    Answer. The reduction in the number of first-time applicants with 
the M.D. degree seems to have leveled off in fiscal 1997 to about 22 
percent below the peak observed in fiscal 1994. Nevertheless, the 
participation of physicians in NIH research training programs is 
considered essential and any erosion in the number of applications from 
physicians is viewed with considerable concern. To address this 
important issue, the NIH has recently announced a new set of career 
award mechanisms: one is designed to offer new training opportunities 
in clinical research to at least 80 young physicians each year. Another 
will increase opportunities for mid-career clinical researchers who 
will serve as mentors to beginning investigators. The third will 
support the development of high-quality didactic instruction in 
clinical research methodology. We are hopeful that these new awards 
will ultimately increase the number of physicians submitting 
applications for clinical research grants. To provide some indication 
of the magnitude of this initiative, we estimate that, if all of the 
entry level awardees supported by this program apply for research 
project grants after completing their career awards, there will be a 
greater than 10 percent increase in applications from physicians each 
year for several years into the future.
    Question. Related to this issue, I am concerned that you have 
eliminated the R29 grant, which has been useful in helping get young 
investigators established. Certainly, with the steep decline we are 
already seeing in first-time physician applicants, it is important that 
steps be taken to assure that the elimination of the R29 does not 
exacerbate the problem. It is my understanding that you believe that 
steps can be taken to assure special consideration of new applicants 
within the peer review process, but that many in the research community 
do not share your optimism. Please tell us how you plan to assure 
special status for new applicants, how you plan to monitor any trends 
in the success of new applicants, and what you plan to do to 
immediately correct any negative effects of the elimination of the R29.
    Answer. Our new policy, to use the regular R01 research project 
grant application and designate specifically which come from new 
investigators, was adopted after careful analysis. It was found that 
the R29 mechanism often was not actually advantageous for new 
investigators, as it involved limitations on funds and required a five-
year time commitment as well as a minimum of 50 percent effort. Under 
the new approach, these restrictions do not exist.
    To ensure a fair review for new investigators, NIH staff are 
carefully explaining the new policy to scientific peer review panels 
and advisory boards and councils, the application form has been revised 
to allow new investigators to indicate their status and to ensure that 
reviewers can clearly identify those applications. To stabilize the 
number of new investigators entering the research system, the NIH has 
committed to supporting at least the same number of new investigators 
as in fiscal year 1998; The goal is to ensure that new investigators 
receive sufficient resources to sustain their research programs and to 
maintain the same influx of investigators in order to promote a healthy 
medical research system in the future.
    Question. Funding for General Clinical Research Centers: The IOM 
and your panel identified the General Clinical Research Centers as a 
critical resource for patient-oriented research and both reports 
recommended that these be funded more generously. It is my 
understanding that the GCRC budget has declined as a proportion of the 
NIH budget from 3 percent in 1968 to 1 percent for the current year. 
Given all the obstacles and challenges confronting clinical 
investigation, how much of the funding increase for the National Center 
for Research Resources should be allocated to the GCRC's? In addition, 
have you considered using your discretionary fund or transfer authority 
for this purpose?
    Answer. There is no question that the General Clinical Research 
Centers (GCRC) are a critical resource for clinical research for NIH. 
We agree that it is important to support the GCRC's at a level required 
to permit appropriate patient oriented clinical research as supported 
by the NIH categoric institutes. The NIH commitment to do so is 
indicated by recent statistics. Since fiscal year 1993, the increase 
for the GCRC's has matched that of the NIH as a whole, and that 
relationship has remained the constant over that time. This reflects 
the condition of research as a whole, and the necessary balance between 
basic studies and the translation of research results to patients.
    I have no plans currently to use the Discretionary Fund or the 
transfer authority to increase funding for the General Clinical 
Research Centers. I believe that the level of funding requested for the 
GCRC's in the President's Budget is appropriate.
    Question. Peer Review: An outside advisory committee concluded that 
clinical research is on ``an even playing field'' when reviewed by 
study sections that have a grant load for review that is at least 50 
percent patient-oriented. Last July, a report published in the Journal 
of the American Medical Association suggested that two-thirds of 
patient-oriented research grants are being reviewed by the wrong study 
sections. At a minimum, patient-oriented research should be triaged 
away from study sections that review 60 percent or more basic research 
grants. What action has the NIH taken to reform the peer review process 
to give clinical research an appropriate review?
    Answer. The Director of the Center for Scientific Review, Dr. Ellie 
Ehrenfeld, has made this a high priority issue. Soon after her arrival 
at NIH in January 1997, she retained Dr. Michael Simmons, a 
pediatrician at the University of North Carolina, Chapel Hill, to work 
with NIH staff and members of the clinical research community to find 
solutions to the clustering problem outlined in previous reports. As a 
result, she expects to establish, within this calendar year, two 
Special Emphasis Panels (SEP) for review of patient-oriented, 
translational research and small clinical trials in the areas of 
cardiovascular science and clinical oncology. These applications 
account for approximately half of the applications now reviewed by the 
type of ``low density'' study sections to which you refer. 
Subsequently, she is considering creating a third SEP related to 
``Human Investigations'' for review of applications related to patient 
oriented, to translational research and for small clinical trials that 
will be collected in a group from among proposals usually reviewed in 
several ``low-density'' study sections. In all cases, the principal 
investigators will be informed of this option for review by the new SEP 
and asked if they wish to have their applications so reviewed. Thus, 
they may choose to cluster their clinically-oriented applications in 
the SEP or distribute them to one of the many study sections that can 
accommodate the diversity of diseases, biology, organ system, and 
technology being studied.
    Question. Defining Clinical Research: When the Institute of 
Medicine issued its report, it defined clinical research in such a 
manner that only 10-15 percent of NIH research project grants qualified 
as ``patient-oriented.'' Many of the researchers who have contacted me 
take issue with the definition used by your panel, which concluded that 
30 percent of grants are ``patient-oriented''. What underlies this 
difference in grant classification?
    Answer. Clinical research, defined by the Clinical Research Panel 
that I appointed, refers to research conducted using human subjects (or 
material of human origin, such as tissues or specimens and human 
cognitive phenomena) for which an investigator directly interacts with 
human beings. It includes research on mechanisms of human disease, 
therapeutic interventions, clinical trials, development of new 
technologies, epidemiologic and behavioral studies, and outcomes and 
health services research. The IOM addressed only a part of the clinical 
research spectrum defined above and also limited its analysis to that 
subset of grant applications reviewed by the Center for Scientific 
Review (formerly the Division of Research Grants); the Clinical 
Research Panel noted that over 50 percent of clinical research grant 
applications are reviewed by units within the other NIH Institutes and 
Centers.
    Question. Should the NIH use the more conservative IOM definition 
to assure that new initiatives are properly focused on clinical 
research?
    Answer. Clinical research is a broad field. As defined by NIH, 
clinical research has changed the face of modern medicine. A generation 
ago, most of the treatment and prevention strategies that are so 
successful today were unknown. Transplantation of the kidney, heart, 
lung, and liver extends the lives of those who, just a decade or two 
ago, would have had no hope. New surgical techniques and medical 
devices, including pacemakers and artificial joints, save lives and 
restore the quality of life for many people. High blood pressure and 
its deadly consequences, such as stroke and heart attack, are 
treatable. Modern pharmacotherapies allow those suffering from mental 
illnesses like depression and schizophrenia to lead productive lives. 
Today, because of the pace of science and the breadth of discovery, the 
time frame between a new laboratory finding and an innovative treatment 
for human disease is greatly foreshortened. Clinical research is, more 
than ever, a vital link in the research continuum by which the public 
ultimately benefits in the form of new treatments and prevention 
strategies. Many of these examples would not have been captured by the 
IOM definition of clinical research.
    Dr. Ehrenfeld also has established the Panel on Scientific 
Boundaries for Review as an ad hoc working group of the CSR Advisory 
Committee to undertake a comprehensive examination of the principles 
governing organization of all CSR study sections. Among the issues they 
will consider is the dilemma, which extends beyond clinical research, 
of meeting needs for in-depth expertise on the one hand and the 
requirement for scientific breadth on the other.
               participation of multicultural scientists
    Question. What is the NIDCD doing to promote existing opportunities 
for participation by scientists from multicultural populations in 
communication disorders research? Are there any plans to make 
additional research opportunities available?
    Answer. The National Institute on Deafness and Other Communications 
Disorders (NIDCD) uses a number of training mechanisms for scientists 
from multicultural populations to participate in communication 
disorders research. In particular, the NIDCD Partnership Program was 
launched with the support of the Office of Research on Minority Health 
(ORMH) in 1994. It is a pilot program designed to maximize 
opportunities for underrepresented individuals to become involved in 
research in human communication. Undergraduate and graduate students, 
medical students, faculty, and administrators at the Morehouse School 
of Medicine/Atlanta University Complex (MSM), the University of Puerto 
Rico (UPR), the University of Alaska System (UAS), and Gallaudet 
University have participated in the Program. Collaborations have 
included experiences in the laboratory, in program management, grants 
management, planning and public affairs, as well as curriculum 
development and workshops.
    In addition, the NIDCD uses a number of research and development 
mechanisms to attract multicultural scientists, including Postdoctoral 
Training Programs, Opportunities for Foreign Scientists, College and 
Postbaccalaureate Student Programs, High School and Undergraduate 
Student Programs, and Summer Programs.
    The NIDCD is an active participant in the NIH-wide NRSA program for 
Predoctoral Fellowship Awards for Minority Students and for Students 
with Disabilities. In fiscal year 1998, the NIDCD, in collaboration 
with the ORMH reissued a request for applications for a small grants 
program to support the dissertation research of minority students in 
the sciences of human communication. To date, this program has resulted 
in ten grant awards. In fiscal year 1996 and 1997, the Institute and 
the ORMH issued a program to foster the research career development of 
faculty in minority academic institutions in the sciences of human 
communication, resulting in five awards.
    An important vehicle for the research training is the Research 
Supplements Program for Underrepresented Minority Individuals and the 
Research Supplements Program for Individuals with Disabilities. This 
program provides funds to supplement regular research grants for 
studies performed by persons in such groups.
    The anticipated growth of the Institute's research grant portfolio 
in fiscal year 1999 will provide us with the opportunity to increase 
the size of our research training and career development enterprise. 
The NIDCD expects to continue previously implemented programs and to 
consider the implementation of new targeted programs to increase the 
flow of the investigator pipeline into the sciences of human 
communication.
    The NIDCD will participate in the following new NIH-wide research 
career development award initiatives for fiscal year 1999: (1) the 
Mentored Patient-Oriented Career Development Award, (2) the MidCareer 
Investigator Award in Patient Oriented Research, and (3) the Clinical 
Research Curriculum Award. The current NIDCD portfolio of career 
development awards already includes a large proportion of clinician-
scientists developing patient-oriented (clinical) research programs 
(approximately 75 percent) as well as basic research programs 
(approximately 25 percent).
    This past September the NIDCD called an expert panel together to 
provide recommendations for the future of the Partnership Program. 
Among the key recommendations were: (1) to continue the Partnership 
Program and maintain pilot status so that tracking of participants can 
be continued; (2) to expand the program to extramural grantee 
institutions that serve large numbers of the disadvantaged groups in 
order to increase research training opportunities for additional basic 
and clinical scientists; and (3) to enable larger numbers of 
researchers to be trained, NIDCD-funded grant holders should be 
systematically incorporated into the program. Responding to the ad hoc 
expert panel recommendations, NIDCD is planning to expand this program 
into the extramural community. The Institute proposed the EXTRA! 
Partnership program to support this expansion and it will be supported 
in part by ORMH funding.
          communication disorders in multicultural populations
    Question. We are aware that attention is being given to stroke and 
Sickle Cell Anemia in Minority populations. Are there any plans to 
expand research relative to the variety of communication disorders that 
occur as a result of other conditions that may be prevalent in 
multicultural populations?
    Answer. In May 1997, NIDCD cosponsored, with Howard University, and 
with funding from ORMH, a national conference entitled ``Communication 
Disorders and Stroke in African American and Other Cultural Groups: 
Multidisciplinary Perspectives and Research Needs''. A number of 
research needs were identified by the speakers, by audience 
participants and by a post-conference committee which formulated a 
series of research recommendations. It recommended that research goals 
might be best accomplished through the establishment of centers focused 
on communication disorders and stroke in African-American and other 
cultural groups.
    In anticipation of the establishment of such centers, a program of 
exploratory grants (P20) is being developed in conjunction with ORMH. 
These grants would allow potential applicants the necessary start-up 
and preparation funds and time, thereby allowing those institutions 
which do not have a long history of NIH funding to develop critical 
components and enhance the likelihood of successful competition during 
peer review. Historically Black Colleges and Universities and 
universities/medical centers with access to significant numbers of 
minority individuals will be encouraged to apply.
                 ethnic balance among research subjects
    Question. We also understand that the Institute is to ensure that 
there is a racial and ethnic balance among research subjects. What is 
the NIDCD doing to ensure that research being conducted incorporates 
this kind of balance?
    Answer. The NIH Peer Review System ensures that, for clinical 
studies, there is an appropriate racial and ethnic balance among 
research subjects. NIH policy requires that minorities be included in 
all research involving human subjects, and the NIH Revitalization Act 
of 1993 requires that there be monitoring of such inclusion. In 
response to the Revitalization Act, a centralized database was 
developed by the Center for Scientific Review (CSR) to assist in 
tracking demographic information. In January of 1995, such information 
was required for all NIH supported Phase III clinical trials. An NIH-
wide committee was established to coordinate these activities. Each 
month, the committee meets to discuss further implementation of the 
gender/minority tracking system. NIDCD is represented in each of these 
meetings. To provide additional follow-up, NIDCD health science 
administrators contact individual principal investigators if problems 
are noted.
                            thyroid disease
    Question. An estimated 13 million Americans have thyroid disorders, 
more than half of which remain undiagnosed. The symptoms of the disease 
may often be ignored or misdiagnosed, with women and the elderly being 
most at risk. If left untreated, thyroid disease can cause long-term 
complications, elevating cholesterol levels which may lead to heart 
disease and cause menstrual irregularities which may lead to 
infertility. Given the large numbers of Americans impacted by various 
thyroid disorders, what research is underway at the NIDDK and other 
Institutes to further the accurate diagnosis and treatment of thyroid 
disease?
    Answer. NIH supports a great deal of research on thyroid diseases 
and conditions. More than 200 research projects, NIH-wide, received 
support in fiscal year 1997 (some 62 of these by NIDDK). In the area of 
diagnosis, there are 55 research efforts underway, and in the treatment 
area, 107. New developments in both the diagnosis and treatment of 
thyroid diseases depend on an understanding of the interactions of 
thyroid hormone (TH) with an amazing variety of other hormones, of the 
metabolic effects of TH, and of the regulation of metabolism by enzymes 
throughout the body as well as in the nucleus of each individual cell. 
Thyroid hormone is a member of the ``steroid/retinoid/thyroid'' family 
of hormones that directly interact with the genetic material in the 
nucleus of the cell. Some of the specific conditions under study 
include autoimmune disorders (thyroiditis, Graves' (hyperthyroid) 
disease, the role of the TH receptor in autoimmunity and in the 
development of hearing disorders, and disorders of growth and 
development of body organs, as well as cancer); endocrine dysregulation 
in HIV/AIDS; polyendocrine interrelationships, including the effect of 
TH on pituitary hormone function; the mechanisms and effects of TH 
actions on carbohydrate metabolism and diabetes, on obesity and 
atherosclerosis, and on heart and brain function; the genes linked to 
thyroid disease; hypothyroidism, including screening of the population; 
resistance to TH; and environmental effects on the thyroid. To sum up, 
the interactions of TH that must be dealt with in designing approaches 
to diagnosis and therapy are extremely complex, but are under intensive 
research at NIH.
                        tax credits for research
    Question. I read Monday that House Republicans are proposing using 
revenues raised from higher cigarette taxes to pay for a ``medical 
innovation tax credit'' intended to stimulate medical research. Drug 
and biotech companies could take the credit for amounts they spend on 
clinical trials to test new drugs and medical devices at academic 
medical centers.
    Dr. Varmus, are you familiar with the House proposal? If so, what 
is your reaction to the proposal?
    Answer. I am not familiar with the House proposal that you mention. 
I am aware of similar legislation recently introduced in the Senate (S. 
1885) by Senator D'Amato (R-NY), ``The Medical Innovation Tax Credit,'' 
which would enable pharmaceutical companies to deduct an amount, equal 
to 20 percent of certain medical innovation expenses, for clinical 
research testing activities conducted at specified academic 
institutions such as medical schools, teaching hospitals, and not-for-
profit hospitals.
    Question. Is this type of tax credit a smart way to fund biomedical 
research? How would you weigh the benefits of enacting this type of tax 
credit versus increasing funding for NIH?
    Answer. Tax credits are one way to encourage medical research, and 
the Administration has been supportive of innovations such as the 
Research and Experimental Tax Credit. But tax credits serve to energize 
the research that is primarily of interest to private industry, i.e., 
applied research for product development.
    NIH funding supports undirected or fundamental research; in fact, 
the cornerstone of NIH's success is support for individual research 
projects that are designed and conducted by scientists at universities, 
and other private and public research institutions by the award of 
grants and within the NIH intramural program. These study protocols 
capitalize on the most promising science rather than the development of 
a specific product. This fundamental or ``undirected'' research not 
only advances our understanding of human biology and of the mechanisms 
of disease, but also identifies opportunities for the development of 
new ways to diagnose, treat, and possibly cure or prevent disease. This 
basic research that NIH supports provides the foundation upon which the 
private sector builds the applied research that it funds.
    Federally-sponsored and private sector research have different yet 
complementary roles in the biomedical research enterprise. While a tax 
credit will encourage applied research as specifically related to work 
in the private sector, it is not a substitute for increasing the 
funding for NIH. If tax benefits are provided in lieu of increasing the 
NIH budget, then there will be a net loss for the NIH as well as for 
our national biomedical research enterprise.
                     office of alternative medicine
    Question. Dr. Varmus, last year's conference report provided that 
at least $7 million of the $20 million made available for the Office of 
Alternative Medicine would be for peer reviewed research grants that 
respond to program announcements by the Office of Alternative Medicine. 
We had urged you to use these funds to support quality clinical trials 
that can validate promising alternative therapies.
    Dr. Varmus, what progress has been made this year to respond to our 
report language and to increase the number of clinical trials studying 
alternative therapies.
    Answer. On December 19, 1997, I convened a meeting of NIH Institute 
and Center directors and representatives from other federal agencies 
including the Center for Disease Control and Prevention, the Agency for 
Health Care Policy and Research, and the Food and Drug Administration 
to address the development of clinical trials in complementary and 
alternative medicine (CAM). This group met with the Director of the 
Office of Disease Prevention and the Director of the Office of 
Alternative Medicine (OAM) to discuss promising initiatives. This 
meeting and subsequent work with the OAM resulted in the following new 
initiatives being developed for fiscal year 1998. Also, OAM's 
commitment of $1.9 million to the National Institute of Mental Health 
for funding the St. John's Wort clinical trial is ongoing.

                                                             In millions

Research Centers. A request for applications to fund up to four 
    new research center programs in alternative medicine was 
    released and applications were reviewed on April 2-3. These 
    grants will fund centers for alternative medicine focusing on 
    cardiovascular disease, AIDS, addiction and pediatrics at 
    approximately $1 million each.................................$4.0  
Acupuncture and Osteoarthritis. A request for applications to 
    study the effect of acupuncture in the treatment of 
    osteoarthritis in the knee was issued and the applications 
    reviewed on April 13. Based upon this peer review an estimated 
    cost of the projected budget has been increased from $0.5 to 
    $0.75 million. This study will be a large clinical trial to 
    evaluate the effect of acupuncture on this widespread disease.  .75 
Cancer. The OAM and the NCI are planning to begin the testing of 
    two CAM cancer interventions beginning this year, one of which 
    is shark cartilage. Estimated cost is $0.50 each.............. 1.0  
Acupuncture Clinical Trials. A program announcement developed by 
    OAM and seven other Institutes was released in March to 
    solicit applications for pilot trials of acupuncture for a 
    number of conditions. These applications will be reviewed on 
    July 15.......................................................  .75 
Field Investigations. CDC--A physician has been assigned by the 
    CDC, and supported by the OAM, to do several field 
    investigations, in concordance with OAM's original 
    Congressional mandate. Up to four such field investigations 
    will be finished by August 1998...............................  .065
Intramural Projects. The OAM intends to fund two intramural 
    research projects at $0.125 million each in CAM related 
    research. Six applications from NIH intramural scientists have 
    been received and funding is anticipated in July. An 
    intramural panel of scientists have been convened to review 
    the applications..............................................  .250
Intramural Clinical Fellow. In collaboration with the NIAAA, an 
    intramural clinical fellow has been identified to work on the 
    use of acupuncture in alcohol abuse. In addition to testing 
    abstinence, neurochemical and neurophysiological parameters 
    will be studied using Magnetic Resonance Imaging (MRI), 
    functional MRI and SPECT (SPECT)..............................  .285
                        -----------------------------------------------------------------
                        ________________________________________________
      Total fiscal year 1998 OAM Initiatives...................... 7.100

                         conclusion of hearings

    Senator Specter. Thank you for being here and that 
concludes our hearings. The subcommittee will stand in recess 
subject to the call of the Chair.
    [Whereupon, at 3:50 p.m., Wednesday, April 1, the hearings 
were concluded, and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]


  DEPARTMENTS OF LABOR, HEALTH AND HUMAN SERVICES, AND EDUCATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 1999

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

                       NONDEPARTMENTAL WITNESSES

    [Clerk's note.--The subcommittee was unable to hold 
hearings on nondepartmental witnesses, the statements and 
letters of those submitting written testimony are as follows:]
                          DEPARTMENT OF LABOR
  Prepared Statement of W. Ron Allen, President, National Congress of 
                            American Indians
                              introduction
    Good morning Chairman Spector, Vice-Chairman Harkin and 
distinguished members of the Appropriations Subcommittee on Labor, 
Health and Human Services, and Education. Thank you for the opportunity 
to present testimony regarding the President's budget request for 
fiscal year 1999 Indian programs and services. My name is W. Ron Allen. 
I am President of the National Congress of American Indians (``NCAI''), 
the oldest, largest and most representative Indian advocacy 
organization in the nation, and Chairman of the Jamestown S'Klallam 
Tribe located in Washington State. The National Congress of American 
Indians was organized in 1944 in response to termination and 
assimilation policies and legislation promulgated by the federal 
government which proved to be devastating to Indian Nations and Indian 
people throughout the country. NCAI remains dedicated to advocating 
aggressively on behalf of the interests of our 230 member tribes on a 
myriad of issues including the critical issue of adequate funding for 
Indian programs.
            the president's fiscal year 1999 budget request
Department of Labor
    The Native American programs authorized under Section 401 of the 
Job Training Partnership Act (JTPA) (Public Law 102-477) is the primary 
source of Indian program funding under the Division of Indian and 
Native American Programs (DINAP) in the Department of Labor (DOL). The 
secondary funding source, which surrounds the Welfare-to-Work (WtW) 
program, was authorized by Congress as part of last year's balanced 
budget act. Together, these two programs represent DOL's main source of 
support for employment and training services provided to American 
Indian and Alaska Native workers--the most seriously disadvantaged 
segment of the American workforce.
    Native American workers benefit from two special provisions in 
JTPA. First, the Native American program under Section 401 of Title IV 
provides comprehensive employment and training services for youth and 
adults on a year-round basis in all portions of Indian country--on and 
off-reservation. Second, JTPA contains a special set-aside of funds to 
cover services to Native youth in reservation areas, including Oklahoma 
and Alaska, under the JTPA Summer Youth program.
    In analyzing the current need for job training opportunities for 
Native Americans, NCAI recommends that not less than $65 million be 
provided for the Section 401 program in fiscal year 1999, an increase 
of nearly $12 million over the President's request of $53.8 million. It 
should be noted that while the President's budget reflect a general 
increase in JTPA programs, tribal JTPA programs where the only programs 
that did not receive additional funding. Mr. Chairman, this is 
unacceptable. Tribal JTPA program funding must be increased to ensure 
better job opportunities for tribal members. In addition, NCAI 
recommends that no less than the full amount of the President's fiscal 
year 1999 budget request of $15.8 million be provided for the tribal 
set-aside in the Title II-B Summer Youth program in the summer of 1999. 
In this way, Congress will help assure that tribal youth are better 
prepared to enter the workforce.
    With $30 million authorized over the next two fiscal years for the 
tribal component of the WtW program, $15 million is expected to be 
released by DINAP in fiscal year 1998, with the remainder being made 
available in fiscal year 1999. This program will provide employment 
services for long-term welfare recipients. Under the current law, 
federally-recognized tribal governments along with 13 named Alaska 
Native organizations are eligible for the special 1 percent set-aside 
of WtW money. So far, over 65 WtW plans for Indian and Native American 
(INA) have been submitted to the DINAP, with a little over 100 tribes, 
intertribal consortia and Alaska Native groups covered under these 
plans.
    However, since the inception of the WtW program, the Office of 
Management and Budget (OMB) has held up release of funds for tribal 
plans, insisting that the money be made available only in quarterly 
installments. Such limitations are complicating the administration of 
these programs at both DINAP and the tribal level. Furthermore, there 
are no provision in the law that limit such release of funds to INA-WtW 
plans. NCAI asks this Committee to ensure that the authorized funding 
levels for tribal WtW is made available to tribes in a timely manner, 
without excessive regulatory requirements being developed by the 
Administration beyond those required under current law.
Department of Health and Human Services
            Administration for Native Americans
    The Native American Programs Act (NAPA), which is administered by 
the Administration for Native Americans (ANA), is the only federal 
program serving all Native Americans regardless of where they live or 
their tribal affiliation. The NAPA promotes self-sufficiency of 
American Indians and Alaska Natives by encouraging local strategies in 
economic and social development. This promotion is critical in 
overcoming the paramount obstacles of social and economic 
underdevelopment in many Native American communities.
    NCAI supports the President's fiscal year 1999 budget request of 
$34.9 million for the ANA, an amount equal to the current enacted 
funding level. The ANA projects that in fiscal year 1999, grant 
applicants will total 725. Of these, 225 grants are projected to be 
awarded under the fiscal year 1999 budget request. A total of 175 will 
be ``new starts'' grants, and 50 will be continuation grants. ANA also 
anticipates awarding 21 contracts in fiscal year 1999. These grant and 
contract awards will include financial assistance for social and 
economic development and governance, training and technical assistance, 
research, and demonstration and evaluation projects.
    Financial support of these projects are expected to result in 
sustained improvements in the social and economic conditions of Native 
Americans within their communities, while increasing the effectiveness 
of Indian tribes and Native American organizations to achieve their own 
social and economic goals. Such goals include the expansion and 
creation of businesses and jobs in many areas including tourism, 
specialty agriculture, arts and crafts, cultural centers, light 
manufacturing, health care systems, housing, day care, fishing, and 
other natural resource development. Other benefits include increased 
capacity-building and infrastructure development for tribes and 
organizations, particularly through the development of codes, court 
systems, and the revision of existing tribal constitutions.
    Native American Program assistance through the ANA has moved many 
tribal and Native programs from dependency on federal services, or 
operating federally-mandated programs, to developing and implementing 
their own discrete projects. ANA continues to serve a large and diverse 
base of Native American communities and organizations, many of which 
have little in the way of resources and lack sustainable economic 
development opportunities. Congress is urged to support the tribal 
self-sufficiency goals promoted by the ANA through supporting the 
President's fiscal year 1999 budget request for this agency.
            Administration for Children and Families
    The enactment of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996 (welfare reform) (Pub. L. 104-193), 
generated a myriad of issues that impact tribal governments. The most 
critical of these issues is the ability of tribes to enjoy equal 
treatment under the welfare reform law as sovereign governments, 
similar to that afforded to the states. As tribes have previously 
stated ``welfare reform is one of the greatest changes to occur to 
Indian country since the enactment of the Indian Reorganization Act''. 
What many tribes perceive welfare reform as being, is the devolution of 
the federal trust responsibility to the states as well as an 
encroachment upon the government-to-government relationship that exists 
between Indian tribes and the federal government.
    As an initial response to this law, tribal governments directed 
NCAI to develop and submit to Congress a set of tribally specific 
amendments to the welfare reform law. If adopted, these amendments 
would have resolved many of the tribal leaders initial concerns. 
However, only those tribal amendments that the DHHS included in their 
welfare reform technical corrections package were considered by 
Congress and included in last year's balanced-budget act. As I have 
stated previously, empowerment of tribal governments only works if 
federal funding levels are there to ensure such transition of powers. 
Unfortunately, the President's fiscal year 1999 budget does not provide 
any new discretionary funding sources that allow for such transitions 
in the area of tribal welfare reform initiatives.
    Most tribal communities continue to suffer from a lack of adequate 
infrastructure, economic development and other community improvement 
factors necessary to properly administer their own welfare reform 
programs. In order to achieve these community development goals, tribes 
must have adequate funding for economic development, technical 
assistance, data collection, construction, job training, children and 
family support services, housing, transportation, alcohol and substance 
abuse programs and tribal enforcement plans. If federal support is not 
offered to help tribes create jobs, sustainable economies and community 
well being, welfare reform may lead to forced relocation, or even 
starvation, for many Native American families.
    The President's fiscal year 1999 budget request again fails to 
provide the Division of Tribal Services (DTS) its own discretionary 
program authorization and budgetary line-item. Because of this, the DTS 
continues to be forced to borrow scarce resources from other agency 
programs in order to provide services to tribal governments in the 
areas of Temporary Services for Needy Families (TANF) and Native 
Employment Works (NEW) laws. The ACF has tried to provide necessary 
funding to carry-out these duties, but it has become more and more 
obvious that without line-item funding authorization for the DTS, the 
ever-increasing needs of Indian tribes surrounding these welfare reform 
programs will not be met.
    NCAI urges Congress to immediately authorize $10 million in initial 
line-item funding for the DTS. As part of this authorization, NCAI asks 
Congress to also expand the DTS role beyond just TANF and NEW, to 
include welfare reform related tribal services under the ACF including 
child care, child support and enforcement, and child protection 
services. Creating a more streamlined approach to serving tribal 
governments welfare reform program needs will benefit all parties 
involved in providing, obtaining and accounting for these services. 
NCAI also calls upon Congress to hold oversight hearing on welfare 
reform's impacts on Indian country. In this way, tribal leaders can 
report directly to Congress on their needs, goals and objectives 
surrounding the conversion of tribal cash assistance populations into 
tribal workforce populations.
            Administration on Aging
    Within the Older Americans Act (Public Law 89-73), there are four 
provisions that are of special importance and interest to Native 
American elders. The first is Title VI: Grants for Native Americans. 
The purpose of this title to promote the delivery of supportive 
services, including nutrition services to older American Indians, 
Alaska Natives, and Native Hawaiians. NCAI requests that the full $30 
million authorized for Title VI be appropriated in fiscal year 1999. 
Funding under Title VI provides key ``front-line'' services for 229 
programs serving reservation elders, including congregate and home-
delivered meals, transportation and a wide variety of other elder 
related services.
    The second provision is Title V: Community Service Employment for 
Older Americans. This program provides funds to ten national sponsors, 
including the National Indian Council on Aging (NICOA), to train low 
income elders through community service agencies. NCAI requests an 
appropriation of $463 million for Title V programs in fiscal year 1999, 
with at least $5.4 million earmarked for Indian elder programs. The 
Title V program is especially important for Indian country due to the 
significant need for our Indian elders to acquire job skills and 
supplement their very limited incomes.
    The third provision is Title IV: Training, Research, and 
Discretionary Projects and Programs. Activities supported under Title 
IV have helped organizations such as NICOA gather knowledge about the 
problems and needs of Indian elders, and design and test innovative 
services to meet the needs of this rapidly-increasing population. 
Additionally, Title IV provides the only source of training funds for 
Title VI program directors. For fiscal year 1999, NCAI requests 
$630,000 in appropriated funding under Title IV, with at least 
$130,0000 earmarked for a continuing grant to NICOA to gather 
information on Indian elders and to quantify their needs. The remainder 
should be directed to grants for training and development of Title VI 
services providers to better serve Indian elders.
    The forth and final provision is Title VII: Allotments for 
Vulnerable Elder Rights Protection Activities, Subtitle B: Native 
American Organization Provisions. Subtitle B was intended to assist in 
prioritizing elder rights issues and carrying out elder rights 
protection activities in Indian country. With deteriorating economic 
and social conditions in much of Indian country, elder abuse is on the 
rise. Prevention programs for tribes throughout its elder communities 
are desperately needed, and yet, no funds have ever been provided for 
Subtitle B, despite an authorization level of $5 million. State 
programs currently received $4.5 million for ombudsman services and 
$4.7 million for prevention of elder abuse programs, however, these 
programs seldom, if ever, reach Indian country. Mr. Chairman, we 
request that the full $5 million be appropriated in fiscal year 1999 
for these tribal programs under Part B of Title VII.
    Within the next sixty days Congress is expected to undertake 
reauthorization of the Older Americans Act (OAA), which includes many 
tribally-specific programs highlighted above, that serve our Native 
American elders. Our tribal cultures teach us to humbly respect our 
Indian elders as the teachers of our traditions to us and our children. 
We urge Congress to honor this respectfulness by reauthorizing the OAA 
and fully fund all Indian elder programs under this Act.
            Health Resources and Services Administration
    Given the size and distribution of the American Indian and Alaska 
Native population--less that 2 million--it comes as no surprise that 
most communities are typically not well informed, nor skilled, when 
interacting with formal government programs or answering to their 
requirements. This limitation is felt in most program and policy 
arenas, and especially so in the context of the evolving U.S. health 
care domain. HIV/AIDS programs--as microcosms of this health care 
transformation--manifest the entire breadth of these complications and 
problems.
    Federal support of HIV/AIDS work in Native communities falls into 
four principal categories. The first of these, the National Institutes 
of Health, is a highly competitive venue, requiring very sophisticated 
scientific skill and considerable resources. Work through the 
Institutes in Native communities is based in university settings, and 
if a local Native population is involved in research design 
preparation, it is typically on a minor level. The second entity, the 
Centers for Disease Control and Prevention (CDC), is more active in 
providing education and prevention to Native populations, but these are 
subject to state and local controls. CDC procedures require local 
Community Planning Councils that set priorities and require competitive 
grant proposals to obtain funding. These procedures circumvent the 
trust responsibilities between the Federal and AI/AN governments, and 
they create near-impossible situations for Native funding 
possibilities. Even if a community has the resources and capacity to 
assemble a quality proposal, actual population numbers are often too 
small to satisfy council priorities for higher levels of efficacy for 
each dollar spent.
    The third means of support is through the Health Resources and 
Services Administration (HRSA), specifically the Ryan White CARE Act 
(Public Law 104-146). This support is the most available source for 
Native American HIV/AIDS care, but it is not without its own 
complications. Ryan White monies are distributed through it various 
titles, only one--Title V--addresses the federal government's 
responsibility to the AI/AN population. Part F of Title V, authorizes 
the Special Projects of National Significance (SPNS) program and is 
funded at 3 percent of the total amounts appropriated for Titles I-IV. 
Part F also identifies a priority to support the development of 
innovative care programs in Native communities. However, no continuing 
Title V monies are available for Native programs while Ryan White 
continues to receive increased funding. NCAI is concerned that the 
Native American provision has not been funded to the extent that the 
increase in the overall titles would lead us to expect. We ask this 
Committee to insure that there is a set-aside under Ryan White Title V 
for Native Americans that equals no less than $3 million to provide 
AIDS care.
    The fourth category, the Indian Health Service (IHS), seems a 
reasonable locus to handle these allocations, but IHS has failed to 
identify HIV/AIDS as a priority, leading to the dissolution of its 
national HIV/AIDS pharmaceutical support program and its national AIDS 
office. This trend will continue to escalate as the IHS increasingly 
decentralizes and turns over its responsibilities to tribal programs. 
Clearly, IHS does not have a history--nor, more importantly, a future--
in providing care to AI/AN peoples living with HIV/AIDS, especially 
those located in urban areas. Of all the federal programs with monies 
available for HIV/AIDS programs in Native communities, Ryan White has 
the most potential in the near future.
Department of Education
    For Indian children and adults attending public schools on or near 
reservations, the fiscal year 1999 budget request will not be afforded 
them programs that improve their educational opportunities. For fiscal 
year 1999, the Department of Education's Office of Indian Education 
(OIE) request is $66 million, a modest increase of $6.3 million over 
fiscal year 1998. Of this amount, approximately 1,250 local education 
agencies will receive an additional $2.2 million increase over fiscal 
year 1998 to provide supplemental programs--tutoring, counseling, and 
curriculum development--to over 448,000 Indian students attending 
public schools. Also included in this request is $3.3 million to 
reinstate OIE's discretionary grant program for Indian children.
    In fiscal year 1996, funding for the discretionary grants programs 
(Indian children and adult education) and the National Advisory Council 
on Indian Education (NACIE) were zeroed out. This unfortunate trend is 
proposed to continue in fiscal year 1999. Although we support the $66 
million request for the formula grant program, which will help met the 
special educational and culturally related academic needs of Indian 
students, and are pleased that the discretionary funding for Indian 
children has been restored, we continue to urge the reinstatement of 
OIE's discretionary grant program for Indian adults and funding for 
NACIE. These programs not only improve the educational opportunities 
for Indian adults, but provide funding for educational personnel 
development, demonstration projects, and fellowships which are all 
necessary for the future of all Indian students.
    Also, under the Improving America's Schools Act (Public Law 103-
382), OIE is authorized to make grants to Indian tribes to plan and 
develop a centralized tribal entity that would: coordinate all 
education programs operated by the tribe; develop education codes for 
schools; provide support services and technical assistance to schools 
serving children of the tribe; and perform child-fund screening 
services for pre-school age children to ensure proper placement and to 
coordinate the provision of any needed special services. Under the law, 
$3 million is authorized for these grants; however, no funding has ever 
been appropriated. Per Resolution No. SFE-97-041, we request that $3 
million be allocated in fiscal year 1999.
    In the Office of Special Education and Rehabilitative Services, 
Indian tribes receive up to 1.5 percent of the funds appropriated for 
the Vocational Rehabilitation State grants which $2.3 billion has been 
requested for fiscal year 1999. Of this amount, tribes will receive 
$17.3 million, an $1.9 million increase from fiscal year 1998. Per 
Resolution No. SFE-97-033C, there is a need for an additional $4.5 
million above last years level. This additional funding would allow 
tribes the opportunity to provide 11 more culturally appropriate 
Vocational Rehabilitation (VR) services to their members with 
disabilities. Furthermore, Per Resolution No. SFE-97-034SC, new funding 
is needed to provide technical assistance and training to existing and 
proposed American Indian VR programs.
                               conclusion
    Mr. Chairman, we urge the Congress to fulfill its fiduciary duty to 
American Indians and Alaska Native people and to uphold the trust 
responsibility as well as preserve the Government-to-Government 
relationship, which includes the fulfillment of health, education and 
welfare needs of all Indian tribes in the United States. This 
responsibility should never be compromised or diminished because of any 
Congressional agenda or party platform promises. Tribes throughout the 
nation relinquished their lands as well as their rights to liberty and 
property in exchange for these on-going services as well as this trust 
responsibility. The President's fiscal year 1999 budget is a positive 
step towards acknowledging the fiduciary duty owed to tribes.
    We ask that the Congress consider the funding levels in the 
President's budget as the minimum funding levels required by Congress 
to maintain these services and the federal trust responsibility. The 
consensus of Indian country is that the federal government's budgetary 
process has failed to provide for effective services and minimum to 
raise the living standards of Indian communities consistent with non-
Indian communities. In order for federal government to reasonably 
expect tribal government to truly achieve the self-determination, self-
governance and self-sufficiency goals mutually identified by the 
federal government and the tribal governments will not be achieved 
unless meaningful increases are provided for Indian programs and 
services.
    Mr. Chairman, this concludes my statement. Thank you for allowing 
me to present for the record, on behalf of our member tribes, the 
National Congress of American Indians' initial comments regarding the 
President's fiscal year 1999 budget.
                                 ______
                                 
   Prepared Statement of Patricia E. Markey, Legislative Consultant, 
                     United Distribution Companies
    Mr. Chairman and members of the Subcommittee: United Distribution 
Companies (UDC) is a group of companies providing natural gas 
distribution service to customers chiefly in the Midwest and Northeast. 
Nearly half of all LIHEAP-recipient households heat with natural gas. 
UDC companies are deeply committed to meeting the energy needs of all 
our customers, in particular, those of low and fixed-income. Our member 
companies are a vital part of the communities we serve.
    Mr. Chairman, earlier this year, frigid weather struck the 
Northeast, as well as other parts of our country. Many people had a 
very difficult time dealing with the severity of the storms. It only 
takes one day of frigid weather to lead to disaster. Last winter, 
certain regions of the country experienced record cold weather coupled 
with record levels of snowfall. In particular, some Midwestern areas 
suffered through brutal weather well below zero for extended periods of 
time that forced some states to virtually shut-down. To compound the 
severity of the problem, as the weather began to turn bitter, prices 
for fuel oil, propane gas, and in some states natural gas rose 
dramatically over previous levels. Oil prices skyrocketed and propane 
prices doubled and tripled in some areas of the country.
    These conditions challenged and stressed the ``average'' American 
household, but to millions of low-income elderly, disabled and working 
poor families this confluence of factors became overwhelming. The 
choices many were forced to make were untenable; however, the situation 
that many low-income families face in trying to meet their home energy 
needs is difficult even under ``normal'' circumstances. Most of us can 
take the comfort of a warm home during the winter, or some means of 
cooling in the heat of summer for granted. Try to imagine what it would 
be like if you did not have the resources to secure these basic 
necessities. For millions of seniors, disabled, working-poor families, 
and others across this country, LIHEAP is more than economic 
assistance, it is a lifeline for health and safety. No one can go 
without heat in the winter. Mr. Chairman, in the coming months you and 
your colleagues will work to craft necessary spending measures for 
fiscal year 1999 that will set the fiscal spending priorities for the 
next year, as well as maintain the course towards a balanced budget. As 
you chart the course to continue to protect our nation's fundamental 
health, education and social services priorities, we ask you to provide 
critical funding for home energy assistance for low-income Americans.
                     liheap funding recommendation
    Mr. Chairman, we applaud you, Senator Harkin and the other members 
of this subcommittee for your tireless efforts last year to fashion a 
broad bipartisan Labor-HHS-Education spending bill. We also commend you 
for your leadership to move towards restoring necessary funding for 
energy assistance. This year, on behalf of all of our residential 
customers--especially the low-income customers who live in our 
communities--we urge you to continue on this course and to restore 
critical funding for LIHEAP. We ask for your support for the Low Income 
Home Energy Assistance Program, and urge that this Subcommittee and the 
Congress adopt the following in the fiscal year 1999 Labor, HHS and 
Education Appropriations Bill: Provide an appropriation of at least 
$1.319 billion for the fiscal year 1999 LIHEAP; provide an ``advance 
appropriation'' of at least $1.319 billion for the fiscal year 2000 
LIHEAP; and eliminate the set-aside for the Leveraging Incentive 
Program.
    In addition to the funding above, UDC also endorses the 
continuation of the ``Emergency Contingency Fund,'' consistent with 
LIHEAP's authorization statute, which authorized $600 million. However, 
in our view, the emergency funds should not be used in lieu of 
regularly appropriated funds for LIHEAP. It is essential that the 
states have the necessary monies to assist needy households and not be 
subject to the vagaries of the release of emergency monies.
    After a careful review of the facts, UDC is urging a restoration of 
LIHEAP core funding to at least the $1.319 billion level. In recent 
years, funding for the program has dropped precipitously. The National 
Energy Assistance Directors' Association (NEADA) estimated that between 
fiscal year 1995 and fiscal year 1997, 1.3 million needy households--
many of them elderly or disabled--lost necessary aid due to 
insufficient funds. We believe that the $1.319 billion in regular 
appropriations is the bare minimum amount necessary to enable the 
restoration of crucial aid to those households that lost LIHEAP 
assistance over the past two years.
    The U.S. Department of Health and Human Services reports that 
between fiscal year 1981 and fiscal year 1995, the number of federally-
eligible households has risen 45 percent; during this same time, 
however, LIHEAP funding was cut from $1.85 billion to $1.419 billion. 
The fiscal year 1998 funding for the program is even lower--$1 billion. 
In turn, the number of households assisted dropped dramatically. In 
1981, over 7 million eligible households received LIHEAP aid; however, 
last year only 4.5 million needy households were assisted with LIHEAP 
benefits. Reduced federal funding has also resulted in smaller 
assistance grants for those in need of LIHEAP.
    We applaud the Congress for recognizing the pivotal role that 
advance appropriations plays in the implementation of LIHEAP by the 
states, and we urge you to continue to give the states the necessary 
tools to plan the next year's program prior to the next heating season. 
In the past, piecemeal funding had a disruptive effect on the states' 
abilities to plan and implement their LIHEAP Programs. An advance 
appropriation of at least $1.319 billion for fiscal year 2000 is 
central to the effective administration of the program.
    UDC shares the views expressed last April on LIHEAP before the 
House Subcommittee on Early Childhood, Youth and Families. Witnesses 
questioned the value of the Leveraging Incentive Program given the 
inadequacy of funding. UDC would like to go a step further than that, 
and recommend the elimination of the Leveraging Incentive Program. 
Unfortunately, LIHEAP has not been funded at the levels the Congress 
intended when the Leveraging Program was designed. The legislative 
history makes clear that the Congress intended that leveraging monies 
only be appropriated as supplemental funding to the full authorized 
amount--more than $2 billion.
    Congress ought not to penalize low-income seniors and families 
living in states that do not mandate programs for low-income 
households, or do not have casino revenues for lifeline programs 
dedicated to vulnerable citizens. There is no ``level playing field'' 
in the states when it comes to leveraging. Also, recent changes in the 
federal rules on leveraging marginalize the benefit of states' 
leveraging efforts. The paperwork burden on the states for qualifying 
for leveraging is disproportionate to the size of the program. We 
question the value of continuing the effort at LIHEAP's current 
funding. Such constraints also make the Residential Energy Assistance 
Challenge (R.E.A.Ch.) Program unrealistic. In addition, R.E.A.Ch. is 
duplicative of other ongoing efforts.
                        broad support for liheap
    During the first session of the 105th Congress, you and Senator 
Harkin, as well as, several other key members of the Senate led the 
effort to restore critical funding for LIHEAP. Mr. Chairman, we are 
sure that you are also aware of the congressional letters--with broad 
bi-partisan support--urging the restoration of LIHEAP in the fiscal 
year 1999 Budget.
    In addition, the National Governors' Association (NGA) supports 
maintaining adequate federal funding for LIHEAP. The NGA has endorsed 
LIHEAP as a targeted block grant that provides the states with the 
necessary flexibility to best assist the elderly, disabled, and 
working-poor households in meeting their home energy needs. The 
Governors have also urged the Congress to continue to provide advance 
appropriations for LIHEAP to avoid unnecessary disruption in the 
program.
    Another long-standing supporter of LIHEAP, the National Association 
of Regulatory Utility Commissioners (NARUC)--representing the state 
regulatory bodies responsible for regulating the rates and services of 
electric and gas utilities throughout the United States--has also had a 
longstanding policy urging the Congress to reject any further cuts or 
rescissions to LIHEAP. In its most recent action, NARUC has urged the 
Congress to provide at least $1.3 billion for fiscal year 1999 and 
fiscal year 2000, and to continue to provide advance appropriations. 
LIHEAP is recognized as the foundation for many low-income programs 
authorized/mandated by the state public utility commissions.
            the need: liheap helps seniors and the disabled
    Let us examine the households that actually receive LIHEAP. Of the 
5.5 million households which received LIHEAP assistance in fiscal year 
1995, approximately 70 percent of these families had annual incomes of 
less than $8,000. In fact, in Pennsylvania and Iowa, 61 percent and 87 
percent respectively, of LIHEAP recipients earned less than $8,000. Yet 
despite this low income, the majority of recipient households are not 
receiving public assistance. As an example, in Illinois, 70 percent of 
LIHEAP-recipient households are not on welfare.
    On average, one-third of LIHEAP households are elderly. States, 
such as Maine, South Dakota, Georgia, Tennessee, South Carolina, 
Nevada, and Louisiana, and Arkansas find more than 40 percent of their 
LIHEAP recipient households include an elderly person. Four states 
represented on your subcommittee, Mississippi, Texas, South Carolina 
and Nevada had approximately 60 percent of recipient households which 
included an elderly person(s). Due to federal cuts, many of these 
households may have lost assistance. For example, in Pennsylvania, 25 
percent of seniors that received LIHEAP in fiscal year 1995 lost all 
benefits in fiscal year 1997 due to cuts. Finally, nationwide, nearly 
one-quarter of the households served include a disabled member. The 
following 17 states had in excess of 30 percent of LIHEAP-recipient 
households with a disabled member: New Hampshire, Mississippi, North 
Carolina, Idaho, Texas, South Carolina, Arkansas, Nevada, Wisconsin, 
Arizona, Georgia, Oregon, Tennessee, Kentucky, Louisiana, California, 
and Illinois.
    According to a 1994 report by Oak Ridge National Laboratory, many 
low-income households' expenditure for residential energy (their energy 
burden) exceeds 30 percent of income. The report also states that all 
the low-income households which are federally eligible for LIHEAP spend 
over $1,000 per year or 10 percent of income on energy. Typically, low-
income households pay four times the percentage of monthly income for 
energy costs than an average household in America pays. In Illinois, 
the average family pays 5.9 percent of its income on home energy in 
winter, while the average low-income family pays between 20-37 percent 
of income for these energy bills.
 assistance critical to poor making transition out of welfare/working 
                                  poor
    One of the primary goals of the 104th Congress was to secure a 
comprehensive reform of our nation's welfare system. A key underlying 
principle of the legislation is to assist low-income families and 
individuals become/remain self-sufficient. LIHEAP is such a program; 
LIHEAP is the antithesis of welfare. LIHEAP is designed to address the 
needs of low-income families in meeting their annual energy expenses. 
LIHEAP promotes self-sufficiency; it protects these families on the 
edge of poverty from falling deeper into debt, and allows them to have 
more control over their lives and their resources. LIHEAP will become 
all the more important as more welfare recipients make the transition 
to employment.
    Working-poor households account for approximately one-third of the 
LIHEAP-recipient population. Changing dynamics in the work place, 
including inadequate and stagnating wages, part-time employment, and 
fewer benefits are swelling the ranks of the working poor. Some of 
these households have learned that a job does not necessarily get you 
out of poverty. To illustrate, on December 10, 1997, Catholic Charities 
USA released the results of its 1996 survey--the most comprehensive 
report available of private social services and activities. It reported 
that increasingly, working people are coming to them in crisis. This 
organization provided emergency food and shelter to almost 7.9 million 
people in 1996. Over half of those assisted were not on welfare. They 
need help with grocery or utility bills to make it to the next 
paycheck. For many, the choices are between heat and food, rent, 
medicine for a child, or bus fare to work. Catholic Charities has cited 
that there are not enough ``decent'' jobs; therefore, many people will 
not have ``the safety net of minimum benefits, and our agencies simply 
do not have the resources to handle the increased demand.'' Thus, 
everyone has not benefited from the economic expansion.
    Low-income families struggle to stay together. With resources 
stretched thin, a meaningful LIHEAP benefit helps families face daily 
challenges to pay for basic necessities. If you take away or reduce 
their energy assistance, that is one more push toward dependence. These 
families are worth the investment of a LIHEAP benefit to keep them 
independent. LIHEAP fosters independence rather than dependence. It 
helps low-income people stay off welfare.
                       health and safety concerns
    In attempting to argue that LIHEAP is no longer needed, program 
critics have misrepresented ``shut-off'' moratoria as a ``safety-net'' 
in protecting low-income families. In those states in which moratoria 
exist, the moratoria may provide some protection for low-income 
consumers, but no long-term protection. Moreover, moratoria do not 
exist in all states (including cold weather states). In fact, the NARUC 
survey on ``uncollectibles'' catalogues the states policies on ``shut-
offs,'' and illustrates that the states' policies vary greatly. In 
addition, moratoria do not govern unregulated fuels--such as propane, 
fuel oil, or wood; often do not govern emergency situations; and do not 
relieve low-income families of the ultimate obligation to pay for their 
home energy costs when the moratoria end. In addition, HHS reports that 
nearly one-third of LIHEAP-recipient households use bulk fuels; thus, 
are unprotected. In states such as Wisconsin, Minnesota and New 
Hampshire between 30 to 40 percent of their low-income households use 
unregulated fuels.
    With higher payments for home heating fuel, low-income families 
face tough choices: heat-or-eat; go further into debt which will 
jeopardize their ability in the future to become self-sufficient; or 
use potentially unsafe alternative methods to heat which could result 
in tragedies. Elderly households might use single room space heaters 
and turn their thermostats down; these actions will increase the risk 
of hypothermia for these customers. Yet other low-income customers will 
move households together to make ends meet. Tragically, overcrowded 
substandard housing, and the improper use of space heaters have proven 
to have disastrous consequences in our communities.
                   targeted liheap block grant works
    Mr. Chairman, LIHEAP works! As designed by the Congress, LIHEAP is 
a block grant that is targeted to assist low-income households with the 
costs of home energy. While there are broad federal guidelines for 
LIHEAP, the states are encouraged to tailor their programs to best meet 
their individual needs. The Governors determined what agencies should 
administer the program, what eligibility standards will be used, how 
benefits will be structured, the guidelines for the crisis program, and 
the range of assistance to be rendered.
    In addition to program flexibility, the administrative costs of the 
program are minimal--in the range of seven to eight percent. This 
ensures that the majority of LIHEAP dollars (generally 92 to 93 
percent) are directed to energy assistance benefits for the low-income 
families that it was intended to help. Carry-over funds are minimal and 
typically run about 3 percent in most years. Late funding decisions by 
the Congress have unfortunately forced some states to further restrict 
eligibility and to reserve additional start-up funding for September.
        liheap is the centerpiece of private and utility efforts
    The burden of low-income household needs does not rest solely on 
the Federal Government. Our member companies are involved in and 
concerned about the well-being of our communities--both in economic and 
human terms. The states and the private sector recognize their 
responsibility to contribute to the needs of these consumers.
    UDC member companies have developed a host of innovative and 
effective programs to assist their low-income consumers; these include: 
operating and/or contributing to fuel funds; providing discounts and 
credits to low-income customers; providing partial or full waivers of 
home energy connection and reconnection fees, and late payment charges; 
partial or full waiver of home energy security deposits; and partial 
forgiveness of home energy arrears. Moreover, many of our companies are 
involved in various energy conservation/management activities. Overall, 
millions of dollars each year are dedicated to assisting the low income 
with their fuel bills. However, these efforts and most other private 
efforts are built around LIHEAP as their cornerstone.
    Private charitable efforts alone cannot ``take up the slack'' for 
reduced federal funding. Two months ago, Caroline Myers, Executive 
Director of the Crisis Assistance Ministry in Charlotte, North 
Carolina, testified on this subject before the House Labor, HHS, and 
Education Appropriations Subcommittee on behalf of an organization 
which she chairs, the National Fuel Funds Network (NFFN). NFFN's member 
fuel funds are organizations that raise private contributions in their 
local communities to help low-income households pay their home energy 
bills. Fuel funds range from small church groups which distribute 
hundreds of dollars in a single neighborhood to large independent 
organizations which distribute millions of dollars across a state. Fuel 
funds may be a division of a large, social service agency or they may 
be operated by a local utility or energy company. NFFN's testimony went 
into further detail about some of the other private sector programs 
that exist to help bridge the gap between federal LIHEAP funding and 
the need that exists throughout the nation. Her testimony illustrated 
that private efforts cannot make up for adequate LIHEAP funding.
 changing energy policies and utility restructuring create uncertainty
    More than 50 percent of low-income households in this country heat 
their homes with natural gas. Federal and state policies favoring 
greater competition in both the electric and natural gas industries 
have shifted significant costs away from industrial customers, and 
other users with energy alternatives, to residential customers. These 
households are now paying a higher share of the costs of purchasing and 
transporting natural gas today than they did in 1980, when LIHEAP was 
first created. Thus, low-income households continue to face increasing 
energy burdens.
    Last year, in testimony before the House Subcommittee on Early 
Childhood, Youth and Families, Joel Eisenberg, Senior Analyst for 
Public Policy at Oak Ridge testified on the potential impact of the 
restructuring of the electric industry on low-income households. He 
stated that there is ``substantial uncertainty as to whether 
residential consumers in general, and low-income consumers in 
particular, will benefit from these changes to a significant degree. In 
some places there is concern that residential rates may actually 
increase.'' Eisenberg noted that momentous change in the electric and 
gas industry is in process. He cited recent data for the natural gas 
industry from the Energy Information Agency (EIA) which indicate that 
between 1985 and 1995, savings for residential consumers have been 
relatively small so far--in the range of 1 percent.
    Deregulation and increasing competition create intense financial 
pressures on gas and electric utilities. As a result, these companies 
cannot afford to shoulder the responsibility associated with serving 
low-income households without government support in the form of 
continued LIHEAP funding. Since its inception, LIHEAP has been a strong 
and successful public-private partnership that has worked to address 
the problem. If government pulls out of this partnership, a serious 
financial hardship will be created for our low-income citizens.
                               conclusion
    Mr. Chairman, last April's House hearing examined the LIHEAP 
Program. Witnesses included Members of Congress, as well as 
representatives from the states, and the private and public sectors. 
The panel included a representative from a local agency and a former 
LIHEAP-recipient.
    Mr. Specter, the witnesses gave a strong endorsement of LIHEAP and 
the need for more adequate funding. They told compelling stories about 
low-income households who have benefited from the program. The Maryland 
LIHEAP-recipient described her situation as the primary wage earner for 
a family of five. Behind in her utility payments, this divorced mother 
was scheduled to be disconnected. Qualifying for LIHEAP was the 
linchpin to securing continued utility service and working out a long-
term repayment schedule.
    The witness representing a local agency recounted information about 
numerous beneficiaries of the program, including a divorced mother in 
her thirties with three young children. Recently diagnosed with cancer, 
this mother had to quit her job in January when she developed side 
effects to the chemotherapy. This forced her to go onto AFDC and file 
for disability. Her income dropped from $1,600 to $406 per month; 
consequently, she fell behind in her utility bills. LIHEAP helped 
bridge the gap during this crisis. As the House witness cited, ``This 
is an example of the kind of situation that can plunge a self-
sufficient working family into poverty.''
    Mr. Chairman, the changes in the welfare system adopted in the last 
Congress will have profound implications. As families move from 
dependence towards independence, they will need targeted supplemental 
assistance. Families in transition normally start at, or near, minimum 
wage levels. In order for them to continue working and gaining 
employment experience, so that they can be eligible for better jobs in 
the future, they need help to maintain a basic standard of living from 
programs such as LIHEAP.
    As the winter ends, problems for the poor do not! The spring brings 
collections pressures on unpaid heating bills. Without the safety-net 
afforded through LIHEAP low-income households could lose gas and 
electric service. The truth is simple. LIHEAP is a public-private 
partnership program that works for low-income households and helps to 
make energy service available and more affordable to them.
                                 ______
                                 
 Prepared Statement of Roy O. Priest, President, National Congress for 
                   Community and Economic Development
    The National Congress for Community Economic Development (NCCED) is 
pleased to submit this testimony on the fiscal year 1999 Labor, Health 
And Human Services, Education, and Related Agencies Appropriations 
legislation before the Subcommittee. NCCED is the national trade 
association for over 2200 non-profit community based organizations 
known as ``CDC's'' who are committed to community-based economic 
development. NCCED's members are actively involved in housing 
renovation and construction, real estate development, industrial and 
small business development, employment generating activities and other 
programs to revitalize their communities.
    NCCED is able to provide the Subcommittee with concrete and 
invaluable insight into how the Jobs Opportunities for Low Income 
Individuals Program, the Community Economic Development Grants Program 
(OCS) and other so-called Welfare-to-Work programs are, and can be used 
to revitalize communities throughout the country. CDC's are actively 
using these programs to strategically redevelop economically depressed 
urban and rural areas. CDC's have more than 25 years of experience in 
evaluating community needs for housing, economic development and social 
services.
    Our successful use of funding from both the private and public 
sectors, including corporations, banks, foundations, individuals, and 
local, State and Federal government sources stands as proof positive of 
our ability to support the well-meaning objectives of the 
Administration and Congress.
      jobs opportunities for low income individuals program (joli)
    The Job Opportunities for Low Income Individuals (JOLI) Program was 
originally authorized as a demonstration under Section 505 of the 
Family Support Act of 1988 and was recently expanded in the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996. The 
success of the JOLI program was recognized when Congress dropped its 
demonstration status and increased the authorization from $6.5 million 
to $25 million. JOLI's mandate is to create job and business 
opportunities for welfare recipients and other low income individuals. 
The program is administered by the Office of Community Services (OCS) 
within the Department of Health and Human Service (HHS) and is designed 
to evaluate what strategies are effective in transitioning individuals 
from welfare to work. Under the program, grants are provided to 
private, nonprofit corporations to make investments in local business 
enterprises that will result in the creation of new private sector jobs 
for low-income individuals. Fifty-six nonprofit organizations have been 
funded through the JOLI program since 1990 and are using their funds to 
implement a range of job creation strategies including self-employment, 
business expansion and business creation. HHS estimates that these JOLI 
investments will lead to 3,875 new jobs and the establishment of 1,708 
new micro-businesses.
    In fiscal year 1998, only $5.5 million was made available to CDC's 
and other organizations. Unfortunately, the President's budget request 
for fiscal year 1999, as in the past three years does not include a 
request for the JOLI Program. This is a highly competitive program that 
if funded at the fiscal year 1998 level still will not meet the 
capacity of CDC's and other organizations to implement key job creation 
strategies. In 1997, 188 applications were submitted nationwide 
requesting a total of $76.4 million. Only ten programs were funded.
    In some of your States, examples of the number of grant requests is 
very illustrative:
  --Seven applications requesting $3,168,499 came from Pennsylvania. 
        Only one was funded at $499,216.
  --Three applications came from South Carolina requesting $534,909. 
        None were awarded funding.
  --Six applications requesting $2,623,589 came from Washington. None 
        were funded.
  --Six applications requesting $2,843,003 came from Missouri. Only one 
        was funded.
    NCCED supports and would urge funding of the JOLI program at its 
authorized level of $25 million in your fiscal year 1999 bill. JOLI is 
the only permanent federal program whose principal mission is to create 
job and business opportunities for welfare recipients and other low 
income individuals. These funds will be critical to CDC's struggling to 
create new employment and business opportunities for welfare 
recipients' transitioning off welfare.
              community economic development grants (ced)
    Section 681 of the Community Services Block Grant Act authorizes 
the Discretionary Authority of the Secretary of Health and Human 
Services. Under this authority, the Secretary can make grants to 
private, nonprofit organizations through the Office of Community 
Services (OCS) for a variety of activities. Under the Community 
Economic Development (CED) grant program, OCS has the authority to make 
grants to Community Development Corporations (CDC's) to promote 
business and employment opportunities in urban and rural low-income 
communities.
    CED is a competitive, discretionary grant program whose funds go to 
support business and economic development projects launched by CDC's. 
Most CED grants are used to finance commercial real estate development, 
including manufacturing and industrial facilities, business incubators, 
and public facilities--investments with the potential to generate new 
jobs and lead to a more stable employment and business environment in 
economically depressed areas.
    Because of the unique nature of this program, there is great demand 
for CED discretionary funding. In 1996 alone, 335 applications for CED 
were submitted, but only 71 grants were awarded due to limited funding. 
CED grants average $500,000 and competitive CDC applications must 
demonstrate their ability to leverage private sector investment and 
create new jobs at a competitive cost.
    The most recent data compiled on CED funds found that some $26 
million in CED funds has been invested in low-income communities. This 
investment leveraged an additional $51 million in other financing and 
created some 4,500 jobs. Since its inception, the CED program fund has 
been responsible for the creation of more than 20,000 permanent jobs in 
poor communities. By regulation, 75 percent of the jobs created under 
CED go to low income individuals.
    Again, examples of the number of grant requests from some of your 
States is very illustrative:
  --Seven applications came from North Carolina requesting $2,425,000, 
        but only one award of $550,000 was made.
  --Five applications came from Alabama requesting $1,273,178, but none 
        received funding.
  --14 applications came from Pennsylvania requesting $3,652,323, but 
        only three won awards totaling $798,000 [This program helped 
        the Mon Valley Initiative create a small business incubator.]
  --Two applications came from Washington requesting $1,049,312, but 
        only one was awarded $500,000.
  --Four applications came from Missouri requesting $1,097,993 but only 
        one was awarded $500,000.
  --Three applications came from South Carolina requesting $534,909, 
        but none were awarded funding.
    The CED program is unique among federal economic development 
programs. No other federal program exclusively targets investment 
capital to low-income communities, using community organizations as a 
vehicle to invest in job-generating businesses. In many poor urban 
communities and rural areas, there is a constant shortage of investment 
capital. Private financial institutions are often unwilling to provide 
the most important element in a community development project--equity 
capital. CED funds fill this critical capital gap.
    NCCED supports the continuation of CED funding at a minimum at its 
current level of $23.7 million for fiscal year 1999. CED is a major 
source of support for the efforts of community based organizations to 
generate jobs and business development opportunities for low-income 
persons. Recently complied data on the benefits of previous grants 
found that grantees leveraged or raised almost twice the amount of 
money that they had received in CED grant funds--almost $55 million--
from other sources.
    Between 1991-95, the CED program created over 4,200 jobs of which 
94 percent were filled by low-income and unemployed people or people 
receiving public assistance. At a time when we are seeing real progress 
in moving people from welfare to work, NCCED is confident that the 
investment of $23.7 million in fiscal year 1999--the same as in fiscal 
year 1998--for the CED program will continue to serve as a catalyst for 
the levels of private and public sector investment that will assure 
that we reach our national goal of creating 20,000 permanent jobs for 
low-income people.
                               conclusion
    NCCED is pleased to submit this testimony on the fiscal year 1999 
Labor, Health and Human Services, Education, And Related Agencies 
Appropriations. We urge your support and inclusion of funding in your 
fiscal year 1999 bill for the Jobs Opportunities for Low Income 
Individuals Program and the Community Economic Development Grants 
Programs at their current fiscal year 1998 levels.
                                 ______
                                 
         Prepared Statement of the National Job Corps Coalition
    Mr. Chairman and members of the Subcommittee, it is an honor to 
submit to you the National Job Corps Coalition's (NJCC) testimony and 
request for full funding of Job Corps in fiscal year 1999. Thanks to 
your support, more than 69,000 of America's most at-risk youth have had 
the resources necessary to become productive, tax-paying citizens each 
year. Your support for full funding of Job Corps is testimony to your 
commitment to serve this difficult population--economically 
disadvantaged youth with multiple barriers to employment. Through Job 
Corps, they have a second chance.
    You and the members of the Subcommittee have a responsibility to 
invest in programs that work and yield returns for America's tax 
dollars. Job Corps is a cost-effective program that continues to 
produce tangible results.
    For more than 30 years Job Corps has consistently and competently 
demonstrated its ability to address our country's need to educate and 
train economically disadvantaged youth. In Program Year 1996 (July 
1996-June 1997), 80 percent of all Job Corps student left the program 
to join the workforce, enlist in the military, or enroll in higher 
education. However, the true value of Job Corps can best be appreciated 
by considering the immense costs to our country from the alternative 
paths these at-risk youths may have taken such as chronic unemployment 
or dead-end jobs, criminal activity or welfare assistance. There is no 
doubt that Job Corps is a sound investment that merits continued 
support.
Center Operations
    The NJCC's request for fiscal year 1999 Job Corps funding totals 
$1.317 billion. This includes $1.144 billion for base level operations 
at 118 Job Corps centers nationwide. These funds will ensure that Job 
Corps provides full-time comprehensive residential education and 
support services to Job Corps' approximately 69,700 students in 46 
states. Funding at this level will also ensure that all new Job Corps 
centers initiated in 1993-94 are fully operational by the end of 1999.
Facility Construction and Rehabilitation
    Historically, Job Corps centers have been located in previously 
used facilities such as former hotels, military bases, orphanages, and 
seminaries. More than 50 percent of Job Corps' facilities nationwide 
are over 30 years old. The renovation and rehabilitation of these 
structures was seriously underfunded in the 1980's and 1990's. The 
failure to sufficiently fund Job Corps facility needs led to a 
substantial backlog of repairs. Structures that were old when Job Corps 
acquired them, often remain in service beyond their useful lives. At 
some centers, this has affected program performance, threatened safety 
and health codes, or violated building codes. The NJCC's request of 
$89.4 million for facility construction and rehabilitation will help to 
prevent continued deterioration of structures and mechanical systems 
and make further inroads into this backlog of unmet repair needs. To 
expedite the review and construction process, Job Corps is 
investigating options such as design-build.
Center Relocations
    Centers located in cramped, inadequate, or unsafe structures where 
needed modifications are not cost-effective or are unrealistic due to 
site size, need to be relocated to suitable facilities. Relocating 
these centers will enhance their results by removing barriers that 
impede performance. It will also decrease maintenance costs. Thanks to 
your support for funding in fiscal year 1998, the Cleveland Job Corps 
center will be relocated this year. The fiscal year 1999 NJCC request 
asks for $20.5 million to relocate one of four such remaining Job Corps 
centers--Jacksonville, Atlanta, Cincinnati and Little Rock. These 
centers have been on the Department of Labor's relocation list for more 
than 10 years. By funding these relocations, Job Corps will be able to 
fulfill congressional intent which encouraged the Department to 
relocate centers that are in poor physical condition, particularly 
where it is a deterrent to center performance.
Modernization of Equipment and Facilities
    Emerging new technologies and a constantly changing job market are 
challenges that Job Corps faces when trying to ensure student training 
meets the needs of today's employers, and students in turn are placed 
into high growth occupations that yield higher placements into stable, 
full-time jobs. Outdated or obsolete tools, equipment, and materials 
hamper Job Corps' ability to adequately train students in modern 
occupations and meet the needs of employers. By upgrading Job Corps 
vocational offerings and modernizing equipment and facilities, Job 
Corps will be able to prepare students for jobs of the 21st century and 
beyond.
    The NJCC requests $15.4 million as the second installment of a five 
year plan to continue to invest in the modernization of Job Corps' 
vocational training and facilities. Job Corps, working closely with 
workforce development entities and employers, will be able to intensify 
its existing efforts to review and update curricula and to modernize 
its vocational offerings, equipment and programs. This will also enable 
Job Corps to convert or substantially modernize an estimated 50 percent 
of its 1,500 vocational classes, facilities and equipment into new or 
substantially updated trades.
Upgrade of Classroom and Dormitory Furnishings
    In addition, the replacement of equipment and furnishings used 
throughout Job Corps campuses has received low budgetary priority over 
the years. Many centers are in need of funds to replace torn and 
tattered equipment and furnishings. Improving the campus environment 
will help Job Corps enhance student retention rates through better 
daily experiences. In turn, this will encourage students to stay in the 
program, complete training and achieve higher outcomes such as learning 
gains, GED's and quality placements.
    Job Corps is successful in training students because it simulates 
the workplace environment in its classrooms and shops. The NJCC's 
request includes $5.1 million for this purpose. This will help ensure 
Job Corps students have access to up-to-date workstations, tools, 
computers and furnishings. For many disadvantaged youth, a Job Corps 
campus is the only home they know. Replacement of worn furniture in 
dormitories will help Job Corps maintain a living environment that is a 
comfortable and safe haven for learning.
Incremental Expansion
    Since 1990, Congress has supported the goals of the Job Corps 50-50 
Plan, a long-term initiative to strengthen and enhance existing Job 
Corps services and programs while incrementally opening 50 new centers 
to serve 50 percent more youth each year. Currently, Job Corps has the 
capacity to enroll 67,000 new students each year--14 percent more after 
a decade of incremental expansion. However, this represents only a 
fraction of Job Corps' at-risk youth target population. Census reports 
indicate that five million young people aged 16-24 live in families 
with poverty level incomes. The jobless rate of teenagers and young 
adults is higher than that of adults due to less education and 
training.
    Disadvantaged youth will continue to need help in acquiring 
academic, vocational and social skills provided by Job Corps to become 
self-sufficient members of the nation's workforce. In addition, our 
country will need to fill jobs to remain competitive in the world 
economy. This can only be done if employers have access to a national 
network of skilled entry-level workers. During the last decade, 
Congress has twice called upon Job Corps to expand services to 
disadvantaged young people by opening new Job Corps centers in 
communities not being served. Job Corps responded quickly.
    An investment of $33 million in targeted funds will ensure 
continued incremental expansion of five new facilities to more 
adequately serve this population. It will also help to fulfill 
congressional intent, as stated in the fiscal year 1998 Conference 
Report for Labor, Health and Human Services, Education, and Related 
Agencies, ``to examine low-cost options for serving more at-risk youth 
through Job Corps, such as expanding slots at existing high-performing 
centers, constructing satellite centers in proximity to existing high 
performing centers, particularly in States without Job Corps campuses, 
and developing new centers where suitable facilities can be provided to 
Job Corps at no cost.'' The Committee will be making a wise, cost-
effective investment in Job Corps expansion.
Job Corps/Head Start Partnerships
    Historically, Job Corps has had difficulty increasing the number of 
women served through Job Corps due to a shortage of child care 
services. An estimated 10 percent of students entering Job Corps each 
year have dependents. More and more Job Corps students are single 
parents who cannot enroll in the program unless provisions for their 
children can be made. With a shortage of child care services on Job 
Corps campuses, Job Corps' single parents are put on waiting lists for 
enrollment. In addition, new legislation has left a void in child care 
services for disadvantaged youth seeking job training skills. Under 
Welfare Reform, the Child Care and Development Block Grant was 
established as the primary child care subsidy program for low-income 
families. This block grant provides vouchers to single parents to help 
pay for child care, but does not cover costs to build or retrofit 
existing facilities for use as child care facilities. Job Corps' 
students who are parents are considered the ``working poor'' and are 
not a priority for child care vouchers.
    The NJCC's request is $10 million above the Administration's 
request to provide additional child care services on Job Corps 
campuses. This one-time infusion of $10 million will build or retrofit 
up to 10 child care facilities on up to 10 Job Corps campuses 
nationwide. These funds will also help to fulfill congressional intent 
in fiscal year 1998 Appropriations language which encouraged Job Corps 
to develop linkages with the Head Start program.
    A collaborative partnership between Job Corps and Head Start will 
allow both programs to maximize the use of limited resources to serve 
their targeted populations--low-income youth and children. It will also 
serve geographic and demographic areas not being served by established 
programs. Finding suitable child care facilities is often a prohibitive 
factor to Head Start in serving its targeted population. Job Corps can 
help fill this need. Job Corps will provide quality child care 
facilities and Head Start will operate 10 child care programs. Building 
additional child care facilities on Job Corps campuses will allow Head 
Start and Job Corps to jointly serve up to 350-400 additional children 
and their parents annually. This will help facilitate program 
enrollment of and/or completion by Job Corps' single parents who will 
be able to receive the education, training and parenting skills needed 
to become productive members of society; and their children will 
receive Head Start's comprehensive, quality child care services. The 
community surrounding the Job Corps center will also benefit from 
enrollment at these quality child care facilities and from partnerships 
developed through this collaboration.
Job Corps/Community Partnerships
    Job Corps centers are emerging as an integral part of America's 
changing and growing workforce development system. Through strong 
partnerships with One-Stop career centers, close relationships with 
local employers, increasingly visible community projects, innovative 
school-to-work training, and on-line communication between Job Corps 
and workforce development entities, Job Corps operates on the premise 
that state and local involvement is a prerequisite for success. Through 
these linkages, Job Corps will enhance their services to ensure an 
optimal experience for Job Corps students.
Conclusion
    By funding the NJCC's request for fiscal year 1999 at $1.317 
billion, the Subcommittee will help to reduce the number of young 
Americans who depend on public assistance by breaking the cycle of 
poverty and welfare dependence. As more and more Americans strive to 
make the transition from welfare to work, cost-effective education and 
training programs will be vital to their success.
    Job Corps is a national, residential education and vocational 
training program with a proven history of results that justify its 
costs. In addition, Job Corps is a trusted program that capitalizes on 
public-private partnerships, quality programs and fiscal integrity to 
offer the disadvantaged youth of our nation a brighter future. 
Moreover, Job Corps helps to keep America competitive in the global 
economy by providing a pool of qualified entry-level workers who 
comprise a significant and growing portion of the nation's workforce.
    Mr. Chairman and members of the Subcommittee, it is with great 
pleasure that we submit to you testimony on behalf of the National Job 
Corps Coalition. We thank you for your continued leadership and 
dedication to America's disadvantaged youth. Through your continued 
support, more than 69,000 young people who participate in Job Corps 
each year will have the opportunity for a better, more self-sufficient 
future. Thank you.
                                 ______
                                 
   Prepared Statement of Kay Guinane, Consulting Attorney, National 
                          Consumer Law Center
Introduction
    Mr. Chairman and Members of the Committee, the National Consumer 
Law Center appreciates the opportunity to submit written testimony 
regarding appropriation of funds for the Low Income Home Energy 
Assistance Program (LIHEAP) for fiscal year 1999. This testimony is 
submitted on behalf of our low income clients, who live with an 
increasing threat of loss of utility service due inability to pay.
    The National Consumer Law Center (NCLC) is a nonprofit corporation 
dedicated to the interests of low income consumers. Founded in 1969, 
NCLC provides specialized legal support and consulting services to low 
income customers, their advocates, government agencies and private 
attorneys in all aspects of consumer and utility law. NCLC has helped 
utilities, regulatory commissions and advocates design low income 
affordability programs in dozens of states over the past several years. 
NCLC has published leading reports on the impacts of energy costs on 
the poor as well as manuals on related law.\1\
---------------------------------------------------------------------------
    \1\ Manuals relating to utility service include ``Access to Utility 
Service'', ``Tenants Rights to Utility Service'', The Regulation of 
Rural Electric Cooperatives'', and ``A Guide to Low-Income Energy 
Efficiency''.
---------------------------------------------------------------------------
    NCLC is a strong supporter of the Low Income Home Energy Assistance 
Program, as it is the primary safety net between low income consumers 
and disconnection of utility service. It is efficiently designed to 
target benefits to households most in danger of losing that vital 
service. However, without adequate funding, LIHEAP cannot get the job 
done. In fiscal year 1999 Congress has the opportunity to restore this 
program to a level of funding sufficient to provide the protection and 
assistance that low income households desperately need. On behalf of 
our low income clients we urge Congress to appropriate no less than 
$1.437 billion, the fiscal year 1994 level, for fiscal year 1999 and an 
advance appropriation for fiscal year 2000 of at least $1.6 billion. 
Emergency funding is also necessary.
The Need for LIHEAP
    In fiscal year 1998 the overall funding level for LIHEAP reached an 
all time low. This was primarily because no emergency funds were 
released, due to relatively mild winter weather. However, the ongoing 
crisis low income households face in maintaining utility service did 
not change significantly as a result of weather patterns. Instead, the 
impact of reduced funding has meant lower levels of assistance for 
fewer households.
    The human impact of these lower funding levels were confirmed in a 
telephone survey of some of our clients. In Illinois the LIHEAP program 
opened and closed again in October, when funds ran out. Throughout the 
winter things were ``going crazy with shut offs'', according to Lillian 
Drummond of the South Austin Coalition Community Council in Chicago.\2\ 
In many cases, LIHEAP assistance payments were not large enough to 
induce the utilities to reconnect. In East St. Louis, Illinois the 
story is much the same. Joe Hubbard, who has been with the Catholic 
Urban Program for thirty six years, says ``This is the roughest I've 
ever seen.'' He explains that since the cold weather never got severe 
enough to invoke state winter protection rules (below 32 degrees 
Fahrenheit for a 24 hour period), disconnections were allowed. Then 
when the weather did turn colder, households could not get reconnected. 
``Those people are out there lost,'' he stated.\3\ Both Drummond and 
Hubbard cite increasing use of disconnection by utilities as a 
collection mechanism, which most impacts the elderly and working poor.
---------------------------------------------------------------------------
    \2\ Telephone Survey, NCLC, March 27, 1998, Interview Lillian 
Drummond, Staff, South Austin Coalition Community Council, Chicago, 
Ill.
    \3\ Telephone Survey, NCLC, March 27, 1998, Interview with Joe 
Hubbard, Staff, Catholic Urban Program, East St. Louis, Ill.
---------------------------------------------------------------------------
    In Wichita, Kansas diminished LIHEAP funds have also resulted in 
increasing difficulties for low income households. Sunflower Community 
Action reports that the LIHEAP program ran out of money early, with 
many households being shut off. Food pantries, United Way, the 
Salvation Army and other community based organizations are scrambling 
to help, but lack resources needed to get households reconnected.\4\
---------------------------------------------------------------------------
    \4\ Telephone Survey, NCLC, March 27, 1998, Interview with Laura 
Dungan, Staff, Sunflower Community Action, Wichita, Kansas.
---------------------------------------------------------------------------
    The most chilling report on the impact of utility disconnection 
comes from Timothea Howard, Lead Organizer of the Columbia Heights/Shaw 
Family Support Collaborative in Washington, D.C. She states that ``for 
a significant number of households loss of utility service is a 
contributing factor to children going into foster care.'' When families 
cannot stretch their incomes to pay for food, rent and utilities, they 
tend to pay for rent and food first, not realizing that landlords will 
report utility disconnections. Living without utility service is 
considered neglect, which results in removal of children from the home 
by protective services.\5\ Surely it would be more humane and cost 
effective to keep the family together by providing energy assistance.
---------------------------------------------------------------------------
    \5\ Telephone Survey, NCLC, March 27, 1998, Interview with Timothea 
Howard, Lead Organizer, Columbia Heights/Shaw Family Support 
Collaborative, Washington, D.C.
---------------------------------------------------------------------------
    Census statistics also show a widespread need for the LIHEAP 
program. Between 13.4-26 percent of U.S. households are eligible, 
according to statutory standards. (See Table I)

   TABLE I.--HOUSEHOLDS ELIGIBLE FOR LIHEAP OF 91,993,582 TOTAL HH IN
                              UNITED STATES
------------------------------------------------------------------------
                                                           Percent total
              Poverty level                   No. HH            HH
------------------------------------------------------------------------
Greater of 60 percent SMI \1\ or 150          24,136,925              26
 percent poverty........................
150 percent poverty or below............      18,718,748              20
125 percent poverty or below............      14,796,445              16
110 percent poverty or below............      12,335,430            13.4
------------------------------------------------------------------------
\1\ State Median Income.
 
Source: 1990 Census, HHS Http://www.acf.dhhs.gov/liheap/census.htm.

    LIHEAP is well designed to channel benefits to those most in need, 
and LIHEAP recipients tend to be on the low end of the poverty scale. 
For example, in fiscal year 1995 40 percent of households that received 
assistance were under 75 percent of the poverty level.\6\ And although 
low income households consume 16 percent less heating energy than the 
average residential household and pay 14 percent less for it \7\, 
energy costs take up a huge proportion of their average $10,048 annual 
income.\8\
---------------------------------------------------------------------------
    \6\ U.S. Dept. of Health and Human Services, Report of Congress for 
Fiscal Year 1995: Low Income Home Energy Assistance Program, p. 30 
Table 12.
    \7\ Oak Ridge National Laboratories, ``The Scope of the 
Weatherization Assistance Program: Profile of Population in Need'' 
March, 1994, p. 2.5.
    \8\ Ibid.
---------------------------------------------------------------------------
    The proportion of energy costs to household income is called the 
energy burden. In 1995 NCLC completed a study that illustrated the 
disparity in energy burden between average residential and low income 
households. We found the burden for the average residential household 
is 3.8 percent, while low income households pay far more. For example, 
a TANF household pays an average of 26 percent of their income on 
energy and recipients of Social Security pay 14 percent.\9\
---------------------------------------------------------------------------
    \9\ National Consumer Law Center, ``Energy and the Poor: The Crisis 
Continues'', January 1995 Ch. II.
---------------------------------------------------------------------------
Impact of LIHEAP Funding Reductions
    The proportion of those households that actually receive assistance 
has decreased as funding levels have plunged in the past four years. 
For example, in fiscal year 1994, 6 million households received 
assistance from LIHEAP \10\, but by fiscal year 1997 a 30 percent 
reduction in funds resulted in loss of assistance to approximately 1.7 
million households, a 28.4 percent cut back. (See Table II and III). 
With funding levels falling even lower in fiscal year 1998, a 42.5 
percent overall reduction from fiscal year 1994, more households are 
losing assistance.
---------------------------------------------------------------------------
    \10\ U.S. Dept. of Health and Human Services, Report to Congress 
for Fiscal Year 1995: Low Income Home Energy Assistance Program, p. 29.
---------------------------------------------------------------------------
    Who is hit hardest by these program cuts? A survey by the National 
Energy Assistance Directors Association (NEADA) released in September, 
1997, showed that of the 1.2 million households that lost LIHEAP 
assistance between fiscal year 1995 and fiscal year 1997, 313,000 had 
at least one elderly member and 156,000 had at least one disabled 
member. Of the remaining 731,000 households it is likely that 43 
percent, or 314,330, had children.\11\
---------------------------------------------------------------------------
    \11\ According to a study by Oak Ridge National Laboratories, ``The 
Scope of the Weatherization Assistance Program: Profile of Population 
in Need'', March, 1994, p. xii, 43 percent of LIHEAP eligible 
households have children.
---------------------------------------------------------------------------
    The NEADA study also found that states have responded to LIHEAP 
budget cuts in a variety of ways, including ``increasing the share of 
benefits to those with the highest energy burdens and special needs 
groups including the elderly and disabled, reducing overall program 
benefit levels, and reducing the eligibility ceiling.'' \12\
---------------------------------------------------------------------------
    \12\ Ibid.

                           TABLE II.--DECLINE IN LIHEAP FUNDING SINCE FISCAL YEAR 1994
----------------------------------------------------------------------------------------------------------------
                                                                        Percent     Total (Regular,    Percent
                                                     Regular + Lev/   change from     Lev/REACH +    change from
                 Fiscal year 1994                      REACH \1\ =    fiscal year    emergency) =    fiscal year
                                                     $1,437,392,360       1994      $1,737,392,360       1994
----------------------------------------------------------------------------------------------------------------
Fiscal year 1995..................................    $1,319,202,479         -8      $1,419,202,479        -19
Fiscal year 1996..................................       900,000,000        -37       1,080,000,000        -38
Fiscal year 1997..................................     1,000,000,000        -30.5     1,215,000,000        -30
Fiscal year 1998..................................     1,000,000,000        -30.5     1,000,000,000        -42.5
----------------------------------------------------------------------------------------------------------------
\1\ Funds for leveraging state and local funds and the Residential Energy Assistance Challenge Option.
 
Source: HHS, www.acf.dhhs.gov/programs/liheap/approp.htm.


 TABLE III.--HOUSEHOLDS RECEIVING LIHEAP ASSISTANCE, FISCAL YEAR 1994-97
------------------------------------------------------------------------
                                                               Percent
                                                             change from
                 Program year                   HH assisted  fiscal year
                                                                 1994
------------------------------------------------------------------------
Fiscal year 1994..............................    6,000,000           NA
Fiscal year 1995..............................    5,500,000         -8.5
Fiscal year 1996-97...........................    4,300,000        -28.4
------------------------------------------------------------------------
Sources: For fiscal year 1994-95, HHS Fiscal Year 1995 Report to
  Congress: LIHEAP, p. 29. For fiscal year 1996-97: National Energy
  Assistance Directors Association Survey, Sept. 12, 1997.

    Decreases in LIHEAP funding have been shown to increase the 
incidence of utility disconnections. Those that do not receive LIHEAP 
assistance are almost twice as likely to be shut off.\13\ The 
consequences of disconnections are well documented and include: Health 
and safety risks associated with alternate heat and lighting sources, 
such as kerosene heaters and candles; Hunger and malnutrition; 
Hyperthermia and hypothermia; Eviction and increase in homelessness; 
and Diminished educational performance by students with high mobility.
---------------------------------------------------------------------------
    \13\ NCLC Testimony regarding LIHEAP Appropriations, to House 
Committee on Appropriations, May 1996.
---------------------------------------------------------------------------
Time is Right to Restore LIHEAP Funding
    Congress has been successful in bringing the deficit under control. 
However, LIHEAP has contributed more than its share to this effort, 
suffering a cumulative loss of $1.1 billion since fiscal year 1985. As 
the nation moves toward a balanced budget, we must also move toward 
balance in our priorities, making sure that basic necessities, such as 
heat in the winter, are available to those who can least afford it. 
LIHEAP has immense impacts for a relatively small budget, and should be 
restored to a level of funding that truly protects the health and 
safety of vulnerable low income Americans.
The Need for Advance Appropriations
    The LIHEAP program needs to go into operation prior to the heating 
season so that state agencies can begin the process of taking 
applications. They need to know LIHEAP funding levels early in order to 
implement the program at a time when it can effectively prevent shut 
off of utility service: during the harshest part of the winter. For 
this reason, NCLC requests that Congress include an advance 
appropriation for fiscal year 2000 in its LIHEAP appropriation this 
year.
Conclusion
    The ongoing crisis low income households face in maintaining their 
utility service has been exacerbated by sharp drops in LIHEAP funding 
over the past four years. In fiscal year 1999 Congress has the 
opportunity to restore this program to a level of funding that will 
avoid disconnections and the threats to health and safety that go with 
them. We ask Congress to fund the program at a level of no less than 
$1.437 billion in fiscal year 1999.
                                 ______
                                 
 Prepared Statement of Phillip Furmanski, Ph.D., Dean, Faculty of Arts 
 and Science; Chairman and Professor of Biology on Behalf of A Center 
   for Cognition, Learning, Emotion and Memory at New York University
    I appreciate this opportunity to submit testimony before the 
Subcommittee to discuss a project of scientific research which is not 
only an important priority for New York University, but which we 
believe will advance national interests through enhanced scientific 
understanding of normal brain development as well as the many 
disabilities, disorders and diseases that erode our ability to think 
and learn.
    Our project addresses the research and programmatic priorities of 
this subcommittee. We strongly support the goals presented in the 
Conference Report accompanying the November 7, 1997 Appropriations for 
the Departments of Labor, Health and Human Services and Education for 
fiscal year 1998. That report, for example, encouraged the National 
Institute of Child Health and Human Development to support, and I 
quote, ``research in the area of brain development, mechanisms that 
underlie learning and memory, the acquisition and storage of 
information in the nervous system, and the neural processes; underlying 
emotional memories as they relate to intellectual development and 
cognitive growth.'' We thank the Subcommittee for taking the time to 
consider and give its support to the important research being conducted 
in this area. We at New York University firmly believe that in the 
coming decades, a federal investment in mind and brain studies will 
repay itself many times over.
    To implement the Subcommittee's goal, New York University is 
undertaking to establish a Center for Cognition, Learning, Emotion and 
Memory. This Center will draw on the University's strengths in the 
fields of neural science, biology, chemistry, psychology, computer 
science, and linguistics to push the frontiers of our understanding of 
how the brain develops, function malfunctions, matures, and ages. In 
addition, as a major training institute, the Center will help prepare 
the next generation of interdisciplinary brain scientists.
    To establish this Center, New York University is seeking $10.5 
million over five years to support and expand the research programs of 
existing faculty, attract additional faculty and graduate and 
postgraduate trainees, and provide the technical resources and 
personnel support that will allow us to create a premier, world class 
scientific enterprise. Individual researchers in the science programs 
at NYU compete for investigational support through traditional routes, 
quite effectively. However, these traditional funding sources do not 
address the specific need for establishment of a new cross-disciplinary 
area of scientific study, particularly one that transcends biomedicine, 
psychology, education, computer science, cognitive science, and 
linguistics. Nor do they provide the extensive funding necessary for 
faculty and student support and personnel and technical resources.
    Exploration into the fundamental neurobiological mechanisms of the 
nervous system can help educators, health care providers, policy 
makers, work force managers, and the general public by enhancing our 
understanding of normal brain development and function in both children 
and adults, thereby helping us to detect and correct impediments that 
affect our ability to learn, to think, and remember, and to mature as 
productive members of family and society. Research in this area will 
ultimately contribute to a better understanding of how children learn 
at different stages; how educators can improve students' retention and 
memory; how childhood and adult learning is shaped by different 
cognitive styles; how aging affects memory; and how diseases alter 
memory.
    There are enormous potential applications for early childhood 
intervention, teacher training, educational technologies, job training, 
and retraining, and diagnosis and treatment of mental and memory 
disorders. These applications directly address national concerns which 
were identified most recently in President Clinton's State of the Union 
address, and by the Departments of Labor, Health and Human Services, 
and Education.
    New York University is well poised to make important contributions 
in this area. Founded in 1831, the University today is the largest 
private university in the United States, with over 49,000 students 
representing a broad range of backgrounds and coming from every state 
and over 120 foreign countries. NYU comprises thirteen schools, 
colleges, and divisions and is known for the excellence of its schools 
of law, medicine, film, and business; the Institute of Fine Arts; the 
Courant Institute of Mathematical Sciences; and departments in the 
Faculty of Arts and Science, notably neural science, chemistry, 
biology, psychology, French, English, philosophy, anthropology and 
economics. Located in the heart of the world's most cosmopolitan and 
diverse city, New York University is a leading national--and in many 
fields, international--center of scholarship, teaching and research. It 
is one of twenty-nine private institutions constituting the 
distinguished Association of American Universities, and is consistently 
among the top U.S. universities in funds received from federal sources 
and from private foundations.
     cognition, learning, emotion and memory studies at nyu (clem)
    The Center for Cognition, Learning, Emotion, and Memory will be an 
interschool, interdisciplinary unit linking faculty, students, programs 
and resources from several schools of New York University. These are 
the Faculty of Arts and Science, Courant Institute of Mathematical 
Sciences, School of Medicine, School of Education, and Center for 
Digital Multimedia. CLEM, to be housed at the University's Washington 
Square campus within the Faculty of Arts and Science, will be the locus 
for laboratory research and training in fundamental neurobiological, 
psychological and computational studies of the nervous system. In 
addition, CLEM will be a point of convergence for faculty and students 
seeking to incorporate these research perspectives into their own work 
in education, medicine, and technology, and seeking as well to enrich 
laboratory research with interdisciplinary collaboration and conceptual 
bridges.
    The new Center will be administratively housed within the NYU 
Department of Neural Science. This department includes affiliated 
investigators from biology, chemistry, psychology, physics, computer 
science, medicine, and mathematics. It is a national center of research 
and teaching, encompassing a pre-eminent faculty, and generating 
substantial external funding from federal and state agencies as well as 
the private sector. The department holds world-class stature in the 
study of the nervous system as a sensory communications system, as a 
controller of motor activity and as a neural network that generates the 
emotional foundation of voluntary behavior. The neural sciences at NYU 
have attracted millions of dollars in generous support from, for 
example, the NIH, NSF, and EPA, the Howard Hughes Medical Institute, 
the W.M. Keck Foundation, and the Alfred M. Sloan Foundation. Its 
faculty have won prestigious awards, being named National Institutes of 
Health (NIH) Merit Awardee, Howard Hughes Medical Institute 
Investigator, National Science Foundation (NSF) Presidential Faculty 
Fellow, McKnight Foundation Scholar in Neuroscience, and MacArthur 
``Genius'' Fellow. The department cultivates productive linkages with 
investigators from other disciplines, educational institutions, and 
research sectors. Thus, linkages between neural scientists, and 
educators in the NYU School of Education, clinicians in the NYU School 
of Medicine, and software designers, computer scientists, and graphic 
artists in the NYU Center for Digital Multimedia facilitate the 
application of scientific discoveries in the classroom, in the clinic, 
and in new technologies.
    The new Center for Cognition, Learning, Emotion, and Memory Studies 
will bring the University's many strengths in these areas more fully to 
bear on the challenges and opportunities that multi disciplinary 
studies present. The Center will provide an organizational identity, 
core resources, and common focus for the university's efforts. For 
students, it will provide an educational forum to apply knowledge 
gained in one discipline to problems in other disciplines. For 
researchers, the Center's synergistic linkages between basic science 
departments, biomedical departments, and mathematical and computational 
units will encourage intellectual cross fertilization and will permit 
the consolidation of individual efforts in multi disciplinary but in 
conceptually coordinated efforts. For colleagues in the fields of 
education, medicine, and technology, the Center will facilitate 
connections with laboratory scientists and enhance the translation of 
research knowledge into health care, educational, and commercial 
applications. The enhanced research and training that will be possible 
at the Center will attract public and private funding above and beyond 
the substantial funds, honors and recognition already awarded to the 
University's researchers, and will support the Center's continued 
growth and development.
           the case for the new center at new york university
    New York University has the resources necessary for the successful 
creation and operation of a major multi disciplinary research and 
training center. There is top-level administrative leadership, a 
commitment to science, intellectual and administrative resources, 
established frameworks for interdisciplinary and interschool 
collaboration, strengths in neuro-biological, psychological and 
computational sciences, and standing in the international scientific 
community. The Faculty of Arts and Science, which encompasses the 
College and the Graduate School, has a preeminent faculty of 560, an 
annual operating budget of $197 million, a student population of 
approximately 9,200, and over 450,000 square feet of dedicated space 
apart from shared University facilities, making it a vital center of 
teaching and research. The science enterprise is especially vigorous, 
the result of a decade-long multi-million dollar development plan to 
renovate research and teaching laboratories and recruit distinguished 
junior and senior faculty, a pioneering science curriculum for 
undergraduate non-science majors, extensive research experiences for 
undergraduate science students, and an enhanced graduate student 
training program of supervised research and teaching assistantships.
    New York University has, as part of its multi-year science 
development plan, created a world- class and widely recognized 
neuroscience program. Neural science at NYU is particularly well known 
for research in visual processing and perception, theoretical 
neurobiology, molecular and developmental neurobiology, and cognitive 
neuroscience. It has outstanding researchers and well-established 
strengths in visual neuroscience, auditory neuroscience, cognitive 
science, neuromagnetism, neurochemistry, neurobiology, behavioral 
neuroscience, mathematical modeling, and computer simulation. Recently, 
these faculty have begun to unravel the biological mechanisms 
underlying cognition, learning and memory. As an example, NYU 
scientists have made important contributions to visual processing, 
deriving the most successful methods available for studying nonlinear 
interactions in neuronal information processing; emotion, giving the 
first real glimpse into the neuroanatomy of fear; neural development, 
with landmark work on the vision system; and the neural bases for 
auditory function, including neural sensitivity to auditory motion 
stimuli.
    With these strengths, New York University is strategically placed 
to create a new and distinctive center that will produce a new 
understanding of the brain, and new ways of using that knowledge for 
improving human health and welfare. The Center for Cognition, Learning, 
Emotion, and Memory will capitalize on our expertise in physiology, 
neuroanatomy, and behavioral studies, and will build on active studies 
that range from the molecular foundations of development and learning 
to the mental coding and representations of memory. The Center will 
encompass diverse research approaches, including mathematical and 
computational modeling, human subject psychological testing, use of 
experimental models, and electrophysiological, histological, and 
neuroanatomical techniques. Examples of the kinds of research that will 
be conducted are taken from our current research efforts, which are now 
dispersed in the departments of biology, chemistry, neural science, 
psychology, and computer science: Neural scientists are investigating 
the anatomical and physiological pathways by which memory can be 
enhanced; the conditions that facilitate long-term and short-term 
memory; and the brain sites where all these memories are processed and 
stored. Neural scientists, working with computational scientists, are 
using digital imaging to characterize normal and pathological mental 
processes in humans. Developmental biologists are studying the 
molecular basis of development and learning. Vision scientists are 
studying form, color and depth perception; visual identification; the 
varieties of visual memory; and the relationship of vision and 
perception to decision and action. Neural scientists are studying the 
neuroanatomy and physiology of emotion. Physicists are taking magnetic 
measurements of brain function that trace the decay of memories. 
Behavioral scientists are studying learning and motivation, acquisition 
of language, memory and aging Neurobiologist and psychiatrists are 
conducting clinical studies of patients with nervous system disorders, 
especially memory disorders. These existing researchers are well 
recognized by their peers and have a solid track record of sustained 
research funding from federal agencies and private foundations.
    As we move through the last years of the ``Decade of the Brain,'' 
NYU, through this new Center, is strategically positioned to lead and 
contribute to accomplishment of the goals of this important initiative. 
Establishment of this Center requires support to bring together 
investigators in the different disciplines that address cognition, 
learning, and memory. Centralized core resources are required to 
facilitate collaboration and add efficiency to the research and 
training functions. New faculty who specifically bridge the disparate 
areas of knowledge and expertise need to be hired and ``set up.'' 
Support must be provided to attract students to this new area and to 
promote work in this area, particularly for those from groups 
traditionally underrepresented in the sciences.
    While other academic institution are also conducting research into 
brain studies, New York University has special strengths in important 
emerging research directions that are central to this Subcommittee's 
goals, as stated in its November 1997 Conference Report. To elaborate, 
vision studies at NYU follow an integrated systems approach that has 
been shown to be the only successful approach to unraveling this 
complex system, and that has established NYU as an internationally 
known center for neuroscience studies in vision. The interest in 
vision, a key input to learning, is associated with focused studies on 
the learning process, particularly, the interaction with memory and 
behavior. These researchers are exploring hard and exciting questions: 
How does vision develop in infancy and childhood? How does the brain 
encode and analyze visual scenes? What are the neural mechanisms that 
lead to the visual perception of objects and patterns? How do we 
recognize letters and numbers? How do perceive spaces, depth, and 
color? How we does the brain move from vision and perception to 
planning and action? How does the brain process what we see?
    NYU scientists are also at the frontier of studies in the 
neuroanatomy and physiology of emotion, a new area of exploration that 
complements studies of how perceptions, thoughts, and memories emerge 
from brain processes. Work recently conducted at NYU and elsewhere has 
established the biological basis of emotions and the patterns by which 
they are expressed within the neural circuits that crisscross the brain 
and project through the body. The new studies have found that there are 
multiple systems in the brain, each having evolved for different 
functional purposes, and each producing different emotions. For 
instance, emotions of fear evolved to help animals survive and 
reproduce in hostile environments; the amygdala, a tiny structure in 
the brain, reacts to stimuli and triggers a physiological response, 
including a rush of adrenaline, a process which constitutes the 
``emotion'' of fear. Work being conducted at NYU also suggests that the 
neural circuits supporting the expression of emotions were highly 
conserved through evolution. They persist, unconsciously, in our daily 
behavior, and shape our reactions to events well before we rationally 
and consciously process the event.
    Scientists at NYU are using behavioral testing physiological 
recording of neural activity, and neuroanatomical user tracing to ask, 
what are the neuroanatomical pathways for the formation of emotions and 
emotional memories? How do we learn and remember emotions? These 
studies have crucial applications for education, health care, and 
social welfare, and address such questions as: How can emotions, such 
as fear, facilitate or undermine the learning process? Do emotionally 
stressful situations affect our ability to remember facts, retrieve 
information, perceive events and objects? How can we enhance memory in 
stressful situations? How can we better diagnose and treat emotional 
disorders--which commonly characterize psychiatric disorders?
                         research applications
    Research conducted in the Center for Cognition, Learning, Emotion 
and Memory Studies will have diverse applications for health, 
education, and social welfare.
    Early Childhood and Education: Research into the learning process 
as it relates to attention and retention holds important implications 
for early childhood development. Although most of the human brain 
development is completed by birth, the scientific findings on brain 
development generated by researchers at NYU point clearly to windows of 
learning opportunity--that open and close--with important implications 
for when children best learn. Understanding how, when and under what 
conditions learning proceeds can lead to practical applications for 
parents, care givers and educators. In the midst of a national debate 
on education reform, thousands of educational innovations are being 
considered without the advantage of a fundamental understanding of the 
learning process. CLEM researchers, coupled with educational 
psychologists and their expertise in normal childhood development , can 
contribute to a better understanding of how parents can stimulate their 
children's cognitive growth, how children learn at different stages and 
use different styles, how educators can accommodate those styles, and 
how educational technology can be harnessed to stimulate interest and 
increase retention and memory. Findings can be quite specific, pointing 
for example, to critical or sensitive periods for acquiring particular 
skills in, for example, basic numeric concepts, writing, or foreign 
language. These findings are crucial to national efforts in early 
childhood education, and improve teaching and learning in the 
elementary grades.
    At NYU, these research efforts will be enhanced by our scholars and 
research conducted in our School of Education, and our Center for 
Digital Multimedia, which brings together educators, laboratory 
scientists and software designers who explore how interactive 
multimedia technologies enhance learning and develop prototype teaching 
models.
    Advances in Biomedical and Behavioral Research: Research conducted 
in our Center will by its nature address the loss of memory through 
aging or disease (including Alzheimer's), as well as disorders of 
emotional systems that commonly characterize psychiatric disorders. 
Many of the most common psychiatric disorders that afflict humans are 
emotional disorders--malfunctions in the way emotional systems learn 
and remember--and many of these are related to the brain's fear system. 
Neurobiological studies of emotion and emotional memory in the brain 
will generate important information about the brain systems that 
malfunction in, for example, anxiety, phobias, panic attacks, and post-
traumatic stress disorders. Research into the brain mechanisms of fear 
will help us understand where our emotions come from, why these 
emotional conditions are so hard to control, and what goes wrong in 
emotional disorders. Ultimately, the research will generate clues for 
prevention and treatment of emotional disorders, focusing perhaps on 
the ways in which unconscious neural circuitry can in effect, be 
altered or inhibited.
    Job Training and Retraining: Research into the fundamental 
processes of cognition and learning, emotion and memory will help 
address the persisting challenge which the nation faces in training new 
recruits to the labor force, preparing welfare recipients to move into 
the labor force, retraining workers dislocated from downsized 
industries, and retraining workers in new technologies. Basic 
scientific research into neural and psychological mechanisms can help 
rationalize job training programs and increase their effectiveness.
    Mr. Chairman, this concludes my testimony. I fully support the 
goals of this Subcommittee, and I thank you for the opportunity to 
testify before you today.
                                 ______
                                 
    Prepared Statement of Scott Allswang, Chairman of the Board of 
       Trustees, Crohn's and Colitis Foundation of America, Inc.
    Mr. Chairman, thank you very much for the opportunity to present 
the views of the Crohn's and Colitis Foundation of America (CCFA) 
regarding fiscal year 1999 appropriations for the National Institutes 
of Health (NIH), and the Centers for Disease Control and Prevention 
(CDC).
    My name is Scott Allswang and I currently have the honor of serving 
as the chairman of the CCFA Board of Trustees. Founded in 1967, the 
Crohn's and Colitis Foundation of America is a non-profit research 
organization dedicated to finding the cause of, and cure for, Crohn's 
disease and ulcerative colitis. The Foundation is committed to a 
nationwide coordinated research program aimed at conquering these 
chronic and devastating intestinal diseases that continue to baffle 
medical science.
    Crohn's disease and ulcerative colitis are serious inflammatory 
diseases that affect the gastrointestinal (GI) tract. Crohn's disease 
may occur in any section of the GI tract but is predominately found in 
the lower part of the small intestine and the large intestine. 
Ulcerative colitis is characterized by inflammation and ulceration of 
the innermost lining of the colon. Because Crohn's disease and 
ulcerative colitis behave similarly, they are grouped together as 
inflammatory bowel disease (IBD). Both diseases present a variety of 
symptoms including; severe diarrhea, crampy abdominal pain, fever, and 
rectal bleeding.
    It is estimated that over 2 million people are afflicted with 
either Crohn's disease or ulcerative colitis, roughly half of that 
number for each disease. Unfortunately, IBD impacts disproportionately 
on young people, with most cases being diagnosed before age 30. 
However, it is not uncommon for patients to be diagnosed in their 
sixties, seventies or later in life. Most IBD patients require long 
term medical therapy and multiple surgeries. Thus, while not considered 
a fatal illness, IBD is a debilitating, chronic condition that can lead 
to intense suffering and morbidity.
    My involvement with CCFA began in 1989, the year that my teenage 
son Jason was diagnosed with Crohn's disease. I have watched him 
persevere despite the devastating symptoms, potent treatments, and 
numerous hospital stays that keep interrupting his young life. Soon 
after Jason's diagnosis, I started volunteering my time to the local 
chapter of CCFA. I made a commitment that I would do all I could to 
help. When you have a way to fight back, you don't feel helpless 
anymore. Jason became involved as well, and throughout the years, we 
have recruited other volunteers to join us. As a co-owner of an 
insurance company, I also have provided numerous hours of consultation 
for IBD patients on issues related to insurance. All over the country, 
people who suffer from IBD and the friends and family who love them are 
giving themselves to CCFA, much like Jason and myself.
                  inflammatory bowel disease research
    Mr. Chairman, I would like to take this opportunity to express 
CCFA's deep appreciation for this Subcommittee's long-standing support 
of NIH and CDC. I would also like to convey a special word of thanks to 
Senator Reid for his invaluable support of IBD research over the years. 
Moreover, I would like to thank you Mr. Chairman, for your leadership 
in providing the National Institutes of Diabetes and Digestive and 
Kidney Diseases (NIDDK) with a 7.4-percent increase in fiscal year 
1998. Together with the National Institute of Allergy and Infectious 
Diseases (NIAID), NIDDK supports the majority of IBD research within 
NIH.
    Although we have made significant progress in recent years in the 
fight against Crohn's disease and ulcerative colitis (due in great part 
to NIDDK's 10-year IBD Strategic Plan implemented in 1993), IBD remains 
among the most challenging disorders affecting the digestive tract. The 
two million people and their families currently living with IBD are 
pinning their hopes for a better life on medical advancements made 
through NIH and CCFA sponsored research. For this reason, CCFA strongly 
supports the concept of doubling the NIH budget over the next five 
years. Regarding fiscal year 1999, the CCFA joins with the Ad Hoc Group 
for Biomedical Research Funding in recommending a 15-percent increase 
for NIDDK, NIAID, and NIH overall as a first step toward achieving this 
goal. Moreover, the CCFA encourages the Subcommittee to increase IBD 
research funding within NIDDK and NIAID from the current $17 million to 
$35 million over the next five years.
    Throughout its 30 year existence, CCFA has recognized the 
importance of working closely with NIH. Virtually all IBD researchers 
funded through NIDDK and NIAID are former CCFA grant recipients. This 
unique partnership has enabled us to sharpen the cutting edge of an 
innovative IBD research grant awards program and CCFA co-sponsored 
scientific symposiums.
    Some of the most promising IBD research in recent years has focused 
on translating findings from studies conducted on animal models to 
humans with IBD. These animal models have enabled researchers to form 
the current hypothesis that Crohn's disease and ulcerative colitis are 
caused by a malfunctioning immune system, wherein components of the 
patient's immune system over-react to normal intestinal bacteria. We 
know that people are susceptible to this malfunction because of their 
genetic makeup but further research is necessary to determine which 
bacteria are responsible, how these bacteria interact with the 
intestine's immune system, and which immune system components are 
involved.
    We are also trying to identify the genes that are responsible for 
making people susceptible to IBD. It is believed that there are several 
types of each disease, and hence, multiple genes are involved. Once we 
understand which immune system components and genes are responsible in 
the different subgroups of Crohn's disease and ulcerative colitis, we 
can use this knowledge to create new and improved treatments.
    Finally, Mr. Chairman, I am pleased to report that due in part to 
CCFA's Basic Research Agenda and our partnerships with NIDDK and NIAID, 
research findings are being translated with greater speed into new 
therapies for IBD patients. By working together we have begun to 
alleviate the intense pain suffered by people with IBD, but there is a 
great deal more that needs to be accomplished. Our progress thus far 
gives us tremendous hope for the future, however, the study of new and 
promising research pathways is dependent upon increased federal funding 
for IBD research at NIH.
                      colorectal cancer prevention
    Mr. Chairman, in addition to coping with either Crohn's disease or 
ulcerative colitis, a sub-set of IBD patients are at high risk for 
developing colorectal cancer. As you may know, colorectal cancer is the 
third most commonly diagnosed cancer for both men end women in the 
United States and the second leading cause of cancer-related deaths. 
Because many IBD patients are highly susceptible to this disease, CCFA 
has a long history of actively promoting the benefits of colorectal 
cancer screening.
    Although colorectal cancer is almost entirely curable when detected 
early, recent studies have shown a tremendous need to (1) inform the 
public about the availability and advisability of screening and (2) 
educate health care providers with respect to colorectal cancer 
screening guidelines. The recently initiated National Colorectal Cancer 
Screening Awareness Program at the Centers for Disease Control and 
Prevention will address these needs by coordinating with national 
partners like the CCFA to develop an information program emphasizing 
the value of early detection. CCFA hopes that this new program will do 
for colorectal cancer screening rates what CDC's Breast and Cervical 
Cancer Screening Program has done for mammography and Pap smear 
screening compliance. Mr. Chairman, CCFA encourages the Subcommittee to 
provide CDC with $5 million (an increase of $2.5 million over fiscal 
year 1998) in fiscal year 1999 for this vital campaign.
                               conclusion
    As we near the end of the 20th Century, the scientific community is 
on the verge of tremendous breakthroughs in biomedical research. The 
development of new technologies coupled with our growing understanding 
of the genetic code have led us to an unprecedented point in the 
understanding of human disease. With respect to Crohn's disease and 
ulcerative colitis, CCFA truly believes that we have reached a turning 
point in the fight against these devastating disorders. Thanks to this 
Subcommittee's continued support of NIH and CDC, CCFA is optimistic 
that the future will yield better treatments and eventually a cure for 
IBD.
    Mr. Chairman, once again thank you very much for the opportunity to 
present the views of the Crohn's and Colitis Foundation of America. If 
you have any questions or would like further information please do not 
hesitate to contact us.
                                 ______
                                 
     Prepared Statement of the Coalition of Northeastern Governors
    The Coalition of Northeastern Governors (CONEG) is pleased to 
provide testimony for the record to the Senate Subcommittee on Labor, 
Health and Human Services, Education, and Related Agencies as it 
considers fiscal year 2000 advance appropriations for the Low-Income 
Home Energy Assistance Program (LIHEAP). The CONEG Governors appreciate 
the support provided by the Subcommittee in maintaining this important 
program, and urge the Subcommittee to provide advance funding at the 
level of $1.1 billion for fiscal year 2000. In addition, we are 
requesting that additional funding authority be provided to allow for 
the release of emergency funds for unforeseen circumstances such as 
price spikes in natural gas or heating oil, severe winter weather and 
other potential emergencies.
    During the current fiscal year, almost 1.5 million very low income 
households in the Northeast states will receive LIHEAP assistance. 
About 40 percent of these households are disabled or elderly. Many live 
on fixed incomes or are making the difficult transition from welfare to 
work. Two-thirds of the region's LIHEAP recipients are very poor with 
annual incomes of less than $8,000 per year. For many of these 
recipient households, annual income is not sufficient to pay high 
winter heating bills, even in periods of economic growth. Many low-
income elderly or disabled residents are forced to make a choice 
between purchasing medicine, food or energy.
    LIHEAP funds play a major role in helping to make home energy more 
affordable for low-income households in the Northeast. The percentage 
of disposable income spent on energy by low-income households can be 
significant. Program funds are targeted to those with high energy 
burdens, averaging 15 percent of household income, approximately four 
times the rate for all households. The program has been very successful 
in helping low-income households pay their energy bills, thereby 
preventing fuel supply shut-offs.
    According to LIHEAP Home Energy Data (fiscal year 1995), households 
using fuel oil usually spend more for home heating than households 
using natural gas, kerosene, LPG or electricity. In addition to having 
some of the highest electricity rates in the Unites States, the 
Northeast also has a high percentage of households that heat with fuel 
oil. Most Northeastern homes are older and have less efficient 
furnaces, further compounding the problem for low-income residents. 
Electric utility restructuring and competition, while bringing lower 
electric rates to the region, will not fully meet the needs of low-
income households which predominately heat with fuels other than 
electricity.
    The availability of advance funding for fiscal year 1999, approved 
as part of the fiscal year 1998 Labor, Health and Human Services, 
Education and Related Agencies Appropriations Act, will play a 
significant role in helping states plan their programs prior to the 
start of the winter heating season. In the Northeast, the winter 
heating season often begins before the completion of the annual 
appropriations process. By providing advance funding, states can plan 
the orderly allocation of funds, thereby reducing administrative costs. 
It also allows states to coordinate outreach and prioritize program 
goals and components more efficiently. Traditionally, 70 percent of 
LIHEAP funds are spent during the first two quarters of the Federal 
fiscal year.
    States have established programs throughout the Northeast to 
leverage additional funds from the private sector. These programs 
include requiring margin-over-rack and oil bid programs to provide the 
lowest possible prices for heating oil; exploring options for 
purchasing natural gas through cooperative arrangements with local 
governments; and initiating partnerships with utilities to provide 
discounts and avoid shut-offs. For example, New Jersey has initiated 
the Safety Net Partnership project with utilities to avert shut-offs 
after the winter moratorium. States are also establishing closer links 
between energy conservation services and LIHEAP, thereby helping to 
reduce long-term energy bills. For example, Maine is utilizing its 
LIHEAP database to identify ``high energy users'' and targets its 
weatherization program to those households.
    States are also exploring the use of summer fill programs to 
purchase oil during the summer months when prices are low, thereby 
increasing the purchasing power of program funds. For example, in 1997, 
New Hampshire's number of emergency LIHEAP cases decreased by 10 
percent from the previous year. New Hampshire attributes the decrease 
to its summer fill program, which enables the state to address fuel 
needs in advance, while protecting eligible LIHEAP households from 
potential winter heating spikes. The reduction in emergencies means 
reduced administrative costs attributed to processing emergency cases. 
Furthermore, LIHEAP recipients do not absorb the additional costs 
associated with emergency deliveries.
    LIHEAP is an assistance program that can promote planning and 
responsibility through the use of innovative initiatives and can be a 
useful mechanism to facilitate the transition from welfare to work. New 
Hampshire allows LIHEAP recipients to participate in a program that 
promotes behavior modification and planning for future energy needs. If 
a LIHEAP recipient remains current with his/her utility provider or 
establishes a credit with his/her fuel vendor by the end of the winter 
season, the program will match the LIHEAP participant's contribution 
(not to exceed $75). This enables LIHEAP recipients to plan for their 
fall energy needs and reduce their dependency on LIHEAP.
    States have also adopted various administrative strategies designed 
to minimize the amount of program dollars that are used to operate the 
program, thereby allowing more funds to be used for assistance. LIHEAP 
administrative costs are among the lowest of human service programs. 
States pay less than $25 per household for program administration. 
Specific examples of innovative administrative strategies include the 
development of uniform application forms to determine program 
eligibility, establishment of a one-stop shopping approach for the 
delivery of LIHEAP and related program services, and the use of mail 
recertification. For example, New Jersey has initiated a program to 
streamline its service delivery process by sending payments directly to 
the utilities.
    CONEG is pleased to have had the opportunity to share its views 
with Chairman Specter and rest of the Subcommittee, and stands ready to 
provide any additional information about the importance of LIHEAP in 
meeting the home heating needs of low-income, disabled and elderly 
residents of the Northeast.
                                 ______
                                 
 Prepared Statement of Robert E. McAfee, M.D., Chair, on Behalf of the 
Join Together National Policy Panel on Addiction Treatment and Recovery
           treating addicton: america's no. 1 health problem
    Mr. Chairman, members of the subcommittee, my name is Dr. Robert E. 
McAfee, and I am to pleased to provide remarks on behalf of the 
National Policy Panel on Addiction Treatment and Recovery, convened by 
Join Together.
    I would like to thank you, Mr. Chairman, for this opportunity to 
offer our recommendations on treatment for addiction. Speaking for my 
colleagues on the Join Together Policy Panel, I hope that this hearing 
initiates a productive congressional dialogue on this issue that 
culminates in the recognition that the alcoholism and drug addiction 
are diseases, that they are treatable, and that when we make an 
investment in helping those who are dependent on alcohol and drugs to 
recover, our entire society benefits.
    When I was asked by Join Together to chair this panel of national 
experts and local advocates on substance abuse and justice system 
issues, I did so with the hope that we might recommendations that would 
be helpful to policy makers and to health care professionals in meeting 
our responsibilities and providing sound health care.
    Having had the opportunity to hold a public hearing, to interview 
experts, people in recovery, mayors and other officials, our panel 
urges that we move with dispatch to prepare and implement a strategy to 
overcome the discrimination that until now has marked the care for 
alcohol and drug dependent members of our communities.
    Our panel offers six recommendations for meeting this treatment 
disparity. Today I would like to urge the members of this subcommittee 
to consider carefully our first recommendation:
    Treatment for alcoholism and other drug addiction must be covered 
as a health benefit on an equal basis with treatment for other 
diseases.
    It is time for substance abuse treatment to be pulled into the 
mainstream of health care.
    In effect treatment should be made broadly available to all who 
suffer from addiction. The panel believes in this concept of equal 
coverage as a matter of fairness, and as a principle of sound public 
policy. Further, it should apply to everyone, whether they receive 
health care in the public system or the private system.
    For this to happen, it is essential that health care providers and 
insurers acknowledge addiction as a chronic, primary, relapsing 
disease, and treat it as any other such condition, be it hypertension, 
diabetes or arthritis. Likewise, health care purchasers, in particular 
employers and governments, must demand that full coverage of treatment 
be included as a basic element of any health benefit.
    Even though addicted persons can go through treatment and achieve 
at least temporary abstinence, some find it difficult over time to 
avoid relapse. Many people who achieve sustained remission do so only 
after a number of cycles of treatment and relapse. Understanding this 
is key to overcoming the stigma of substance abuse and to making 
treatment part of the health care mainstream. Preventing relapse, and 
maintaining recovery, requires support from our workplaces, families, 
schools and religious institutions. For many, these institutional 
supports have already eroded, and must be initiated or reinvigorated. 
This means linkages are necessary between these institutions and the 
treatment site.
Achieving parity
    For substance-abuse treatment to be brought up to par with 
treatment of other chronic diseases, three goals must be met:
  --There must be full coverage of substance abuse treatment as a basic 
        health care benefit.
  --There must be sufficient capacity to treat those in need.
  --There must be access to a variety of substance abuse treatment 
        modalities when and where they are needed.
A. Parity in coverage
    For those who need treatment, often the biggest obstacle is cost. 
For many, lack of health insurance stands as a brick wall between them 
and treatment services. Even for the insured, coverage sometimes 
excludes substance abuse treatment or, at best, provides for only bare-
bones services.
    Unfortunately, the levels and availability of treatment services 
have in many cases declined over the past decade. The reason for this, 
in large part, is practices by health care payers that have led to cuts 
in treatment services by:
  --Setting arbitrary limits on the duration or type of treatment;
  --Emphasizing short-term savings over long-term outcomes;
  --Reducing or eliminating treatment services;
  --Putting insufficient emphasis on quality and individualization of 
        care; and
  --Using gatekeepers who are poorly trained in substance abuse 
        treatment and have a self interest in keeping costs down.
    Purchasers of health insurance, particularly employers and 
government, may not even be aware of these reductions in substance 
abuse services, believing that what they contracted for is being 
delivered. In fact, greater health care savings are likely to be 
achieved by expanding substance abuse treatment, not restricting it. 
Particularly at the workplace, employers stand to gain far more by 
expanded treatment services, in the form of reduced absenteeism, lower 
training costs and enhanced productivity.
    Thus, the first step towards achieving parity is to include primary 
care and specialty treatment for substance abuse in all basic health 
benefits, with appropriate services for family members, including 
children. This would probably cost insurers and managed-care providers 
nothing; the direct cost offsets would be at least equal to or greater 
than the cost of adding treatment. By not fully covering treatment, 
managed-care providers are costing themselves and their subscribers 
millions.
    Employers should not wait for managed-care providers and health 
insurers to act; they should demand coverage of substance-abuse 
treatment as a condition of doing business. As employers and major 
purchasers of health care, it is in their own self interest to do so. 
Coverage for a high quality of addiction treatment should be made an 
express term of agreements between purchasers of health care benefits 
and managed-care providers.
    For poor and elderly people, Medicaid and Medicare should likewise 
provide for substance abuse treatment at least on a par with other 
chronic diseases. State contracts with managed care providers should 
require this. State governments should set aside funding to provide 
treatment for the uninsured. Some revenue for this could come from 
taxes on alcohol and nicotine. Steps must be taken to ensure that 
people who rely on the public health care system have access to 
treatment.
    As state governments implement policies to move welfare recipients 
into the workforce, they must also devise programs to address this 
population's health needs, particularly as they relate to substance 
abuse, and to provide related housing and child-care services. 
Effective implementation of the nation's welfare-to-work reform will be 
placed in jeopardy if appropriate treatment is not coordinated with 
this initiative.
    A second step in achieving parity of coverage is to expand the 
scope of covered treatment to include the full continuum of services 
necessary to achieve appropriate outcomes and sustain recovery. This 
extends from inpatient detoxification and counseling to outpatient 
treatment and relapse prevention, and includes health and mental health 
services, educational and vocational programs, family treatment and 
support services. Treatment decisions, therefore, must be made using 
objective guidelines derived from research and clinical practice, and 
treatment must be sufficiently flexible to match the needs of the 
individual and the severity of the illness. Coverage must also provide 
for simultaneous treatment of substance abuse disorders and their 
physical and psychiatric comorbidities.
    For care providers, this means abandoning generic approaches to 
treatment in favor of more individualized therapies. Research indicates 
that the longer an individual remains in treatment, the better the 
results. The course, length, intensity and type of treatment in any 
given case should be determined based on individual diagnosis and 
clinical necessity, as determined using objective guidelines. Any 
limits on treatment days, visits or payments should be made based on 
appropriate principles as with other chronic diseases. For example, 
some patients need inpatient care for part of their recovery. These 
individuals shouldn't be required to ``fail'' in other treatment 
settings first before being placed in the most appropriate level of 
care.
B. Parity in capacity
    To make addiction treatment the equal of treatments for other 
chronic diseases, treatment capacity must also be enhanced. Capacity 
for providing treatment must be expanded to meet the needs of both the 
private and public systems.
    At our panel's public hearing in Chicago, witnesses from both the 
private and public treatment systems testified to the limited access to 
available treatment slots. In Illinois alone, in 1996, there were an 
estimated 764,000 people in need of treatment, but the state could 
accommodate only 116,000. At any one time in Illinois, there is an 
active list of 1,500 individuals waiting for treatment. No one knows 
how many others gave up or never even tried.
    This lack of capacity for substance abuse treatment exists in stark 
contrast to the medical system's capacity to treat other diseases. If 
you fell this morning and needed your hip replaced, you could have it 
done this afternoon. But if you suffered relapse of an addiction, you 
might have to wait four weeks before getting help.
    Expanding coverage of substance abuse treatment would go a long way 
toward expanding capacity. Just as supply rises to meet demand, more 
money for treatment services would result in wider availability of 
services. But waiting for the market to respond to the demand would 
take time, and even then would require new staff, more training and 
constructing new facilities.
    Even as we seek to expand capacity, we must recognize that 
treatment resources are likely to continue to lag behind demand for 
years. Unless and until there are sufficient resources to meet demand, 
we must come up with a plan to better allocate existing treatment 
resources. In effect, we must develop a triage system, parsing out 
resources to those most in need.
C. Parity in access
    The third greatest obstacle to getting treatment for those who need 
it is access. High cost and limited capacity, of course, are themselves 
barriers to access, but other barriers exist as well. Among them:
  --A lack of timely treatment. When a client presents for 
        detoxification, immediate services should be available. This 
        requires the elimination of waiting lists and of delays in 
        authorizing treatment.
  --A lack of geographic proximity. This is an obvious problem in many 
        rural communities, but even in cities, whole neighborhoods may 
        be without any treatment services, may lack services that match 
        the need, or may be unable to reach treatment due to inadequate 
        public transportation.
  --A lack of linguistic, cultural, ethnic or gender competence.
    Treatment must be made linguistically, culturally, geographically 
and psychologically accessible. This means that every community should 
have access to a full range of treatment services. This does not mean 
that all services must be provided within the community; only that 
those in the community have somewhere nearby to turn for meeting their 
needs. Emergency treatment and detoxification services should be 
available around the clock for all citizens, regardless of ability to 
pay. Treatment staff must be trained to make their services easy to use 
and understand. They must be trained about issues of culture, ethnicity 
and gender, and they must be prepared to provide treatment in the 
client's dominant language.
    A significant factor in ensuring access to substance abuse 
treatment is its integration into the health and mental health care 
systems. Screening for, assessing and intervening in substance abuse 
should be part of general medical and mental health practice. Most 
importantly, substance abuse must be recognized as a primary disease 
and all primary-care physicians, nurses, psychologists and social 
workers must be trained to identify substance abuse--and the children 
of substance abusers--and to order appropriate referral. We must reach 
a point in our perception of this disease where heath and mental health 
care providers understand that failure to diagnose it under some 
circumstances would be considered malpractice. Once again, the business 
sector is ideally situated to demand substance abuse screening from its 
health providers. Treatment of addiction at any stage is economical for 
employers, but the earlier it is diagnosed, the more likely treatment 
is to be successful.
    Hovering over all of this is the stigma of substance abuse. 
Addicted people are judged to be bad, weak-willed, and often criminal. 
Many people either do not understand, or reject, the biological basis 
of the addiction. We take what is at essence a health problem and write 
it off as moral failure. We rely on the criminal justice system for 
solutions. We pass off substance abuse as someone else's problem, when 
in fact it touches all of us.
    In conclusion, Mr. Chairman, no matter what we may think about 
people who are dependent on or who abuse alcohol or drugs, we are wrong 
to push them aside. Substance abuse hurts everyone, if not directly, 
then indirectly through higher crime, unnecessary health care expenses, 
added law enforcement costs, lost workplace productivity and personal 
and family hardship.
    The solution to our nation's drug and alcohol problem is for public 
policy leaders to recognize alcoholism and addiction for what they 
are--chronic diseases, with biopsychosocial causes and manifestations, 
whose prevalence has created a public-health crisis--and to respond 
appropriately by making treatment broadly available to all who suffer 
from them. Such policies would have immediate and far-reaching effects, 
not only in reducing substance abuse and improving health, but also in 
making our communities safer, lowering our taxes, improving workplace 
productivity and reducing health care costs.
    By ``treatment,'' we mean the broadest sense of the word--a 
continuum of care that begins with diagnosis and access to appropriate 
behavioral, pharmacological and spiritual care, but that continues on 
to support the recovering addict in training for work, completing 
school, finding housing, and restoring families. To achieve this 
requires the full support of the community, assisted by federal, state 
and local services and resources coordinated across governmental and 
institutional lines. For communities that make this effort, the payoff 
in improving everyone's lives will be well worth the effort.
    I thank you, Mr. Chairman, for this opportunity to again offer 
remarks to this subcommittee. I would like to close my statement by 
offering the six recommendations of our panel, and provide the names of 
the distinguished colleagues who have worked with me to prepare and 
present them to communities across the country.
    I have also directed that our final report, Treatment for 
Addiction: Advancing the Common Good , be provided to each member of 
this subcommittee. If I, or Join Together, based at the Boston 
University School of Public Health, can provide additional information, 
I hope you and your staff will not hesitate to call upon us.
                                 0_____
                                 
     Prepared Statement of Cyrus M. Jollivette, Vice President for 
               Government Relations, University of Miami
    Mr. Chairman and Members of the Subcommittee: I am pleased to 
submit testimony on behalf of the University of Miami (UM) and Florida 
State University (FSU). Both of the institutions have long enjoyed your 
support, and my colleagues in Florida are deeply appreciative of your 
leadership, Mr. Chairman, and the Subcommittee's confidence. We 
recognize that you and your colleagues on the Appropriations Committee 
face difficult choices as you prepare for the Subcommittee's priorities 
for fiscal year 1999 and we know that you will continue to make the 
difficult choices with the best interests of the nation guiding your 
decisions. My colleagues and I hope that you will find it possible to 
fund the important initiatives detailed below in the fiscal year 1999 
appropriations cycle.
    We would like to highlight two high priority areas: the Risk 
Assessment and Intervention Lyceum proposal--a collaboration between 
the University of Miami School of Medicine and Florida State 
University; and the Minority Cancer Prevention, Control, and Treatment 
Initiatives. A copy of the statement by Dr. Clyde McCoy, Professor and 
Chair of the Department of Epidemiology and Public Health at the 
University of Miami, on behalf of the collaboration and the risk 
assessment proposal, is attached. We would once again thank the 
Subcommittee for the opportunity to testify and request your favorable 
consideration of the proposal.
High priority minority cancer prevention, control, and treatment 
        initiatives
    The Miami-based resources of the University's School of Medicine, 
the Sylvester Cancer Center, one of the oldest and for decades the only 
comprehensive cancer center in Florida, its Courtelis Research and 
Treatment Center, the Batchelor Children's Center Bone Marrow and Cord 
Blood Transplantation Pediatric Oncology Project, and its Early 
Detection Breast Cancer Program (EDP) Consortium in collaboration with 
Jackson Memorial Hospital make this concentration and coordination of 
resources, facilities, staff, research, education and treatment one of 
the most unique resources in the country in confronting and combating 
cancer in minority and ethnically diverse populations. They have an 
absolutely unique patient and data base, unparalleled in the nation for 
minority cancer. They have developed a three-part, comprehensive 
initiative designed to assist in minority cancer control, prevention 
and treatment and are requesting $7 million for this three-part 
campaign: (1) Model Minority Cancer Prevention and Control Program; (2) 
The Pediatric Oncology and Bone Marrow/Cord Blood Transplantation 
Initiative; and (3) the Early Detection Breast Cancer consortium. We 
urge the Department of Health and Human Services (HHS) to implement 
this far-reaching, multi disciplinary and coordinated campaign in 
minority cancer, control, treatment and prevention.
    (1) Model Minority Cancer Prevention and Control Program.--The 
University of Miami School of Medicine, its Sylvester Cancer Center--
which served for decades Florida's only comprehensive center--the 
Courtelis Center for Research and Treatment and the Bachelor Children's 
Center together possess a set of unique resources which can be brought 
to bear in cancer prevention, treatment, and control, especially among 
minority populations.
    They have a unique, and unparalleled ethnically diverse, minority 
patient population base which affords them, in turn, a unique source of 
data, incidence trends and treatment outcomes information, prevention 
and control guidance that can be of invaluable assistance to our 
national health and research agencies. There is not other concentrated 
patient base that would afford the nation's research agencies with such 
a precise mirror of minority and ethnically diverse populations. We 
propose to maximize the effectiveness of the work with this critical 
population base by expanding and further targeting our work in Early 
Detection, Primary and Secondary Prevention Research, Genetic and 
Molecular Epidemiology Research, and by expanding the overall capacity 
of The Courtelis and Sylvester Centers.
    We seek $3.5 million in targeted support for the Model Minority 
Cancer Prevention and Control Program through the National Cancer 
Institute and the Office of the Minority Research. We would 
respectfully request the following language:
    ``The Committee notes the unique resources of the Sylvester Cancer 
Center and The Courtelis Center for Research and Treatment in focusing 
on minority and ethnically diverse patient populations. Indeed, there 
is probably no other data as comprehensive on both African- American 
and Hispanic cancer patients. The Committee recommends that the NIH 
consider entering into a $3.5 million cooperative agreement with these 
centers to fully access and maximize the effectiveness of this critical 
resource in cancer prevention and control.''
    (2) The Pediatric Oncology Initiative.--The second and interrelated 
initiative is the Miami-based Batchelor Project in Pediatric Bone 
Marrow and Cord Transplantation. As noted above, the concentration of 
cancer research and treatment facilities and resources at the Miami 
School of Medicine, make us one of the leading sites in the nation, in 
our work on Minority Pediatric cancer control and treatment. Two-thirds 
of all patients are African-American and Hispanic. Our cord blood 
supply for minority children is virtually unparalleled.
    We are requesting $2 million in fiscal year 1999 funding for this 
component.
    (3) Minority Breast Cancer Initiative/The Early Breast Cancer 
Detection Program (EDP).--Breast cancer is a problem of major public 
health importance in Miami-Dade County. While late stage breast cancer 
disease decreased by 21 percent in Florida, late stage breast cancer 
disease increased by 32 percent in Miami-Dade County. Thirty (30) 
percent of the 600,000 female cancer cases anticipated in 1998 will be 
breast cancer; and one in every 8.5 cases of breast cancer in Florida 
will be diagnosed for Miami-Dade County residents. Breast cancer has 
become a public health crisis.
    Working with the Sylvester Foundation and Sylvester Center, Jackson 
Memorial Medical Center, the University of Miami School of Medicine, a 
consortium of primary health care providers and the American Cancer 
Society, the University of Miami-based EDP seeks $1.5 million per year 
for five-year massive and comprehensive effort to more than triple the 
screening capacity of the EDP consortium.
    We seek to achieve at least 50 daily screenings, and reach in 
excess of 12,500 women each year. Indeed, medically under-served 
minority women who are not screened for breast cancer are at extremely 
high risk concerning the rapid progression of this disease. Breast 
cancer screening has been proven to identify early, smaller lesions 
which are more treatable and at lower cost and result in a higher 
quality of life. Mammography provides an example of a proven technology 
for reducing late stage and increasing early stage breast cancer 
detection, and the University of Miami/Jackson Memorial Medical Center 
is effectively delivering this technology especially among the 
medically under-served.
    However, the ability of the current Early Breast Cancer Detection 
Program (EDP) to meet the Miami-Dade County demand is deteriorating 
quickly due to the lack of funds. The waiting time for women seen by 
the EDP at some primary health care centers has increased to six 
months. There are more than 150,000 medically under-served women over 
the age of 40 in Miami-Dade County who are potentially in need of the 
UM/JMMC early detection program services. Under our proposal, the 
number of women screened from an average of 15 per day to 50 per day--
or 12,500 per year.
The Cuban Heritage Collection
    Finally, the University of Miami is seeking $4 million over five 
years from the Department of Education for a unique and historic 
initiative: The Cuban Heritage Collection. The University proposes to 
create a first-ever, multi-media resource of Cuban research and 
training materials. The Cuban Heritage Collection will be housed in an 
area specifically designed to permanently store, display, and provide 
non-destructive access to all aspects of Cuban history and culture, 
especially as it is reflected in the United States, and will be based 
on the University's existing, large and valuable Cuban collection. The 
Cuban Heritage Collection will have six major components:
  --(1) A Scholarly Collection of National and International Standing;
  --(2) A Broad Spectrum Collection reflecting the History and Culture 
        of Cuba and Cubans;
  --(3) A Working Collection for Teaching, Learning, and Research;
  --(4) A Multi-Media and Multi-Format Collection;
  --(5) An Archive for Permanent Housing of Unique Materials; and
  --(6) A Collection Housed in a New Facility reflecting Cuban Culture. 
        The University proposes to secure $1 million in matching funds 
        from the State and private sources.
                                 ______
                                 
 Prepared Statement of Clyde B. McCoy, Professor and Chair, Department 
 of Epidemiology and Public Health, Director, Health Services Research 
                                 Center
    Mr. Chairman and Members of the Subcommittee: I appreciate the 
opportunity to present testimony on behalf of the University of Miami 
as well as our in-state research and education partner, Florida State 
University. We are deeply appreciative of your leadership, Mr. 
Chairman, and of the Subcommittee's confidence. We are especially 
appreciative and deeply thankful for the supportive language from your 
Subcommittee over the past two years and look forward to your continued 
support for this unique collaboration in fiscal year 1998. I fully 
understand and appreciate that at no time in the past have you and your 
Congressional colleagues faced more challenges and more constraints, 
thus we appreciate even more your willingness to consider the important 
and unique research in education partnership between two of our more 
prominent Universities. As the former campaign manager for Tom Luken, 
who served on the Hill for over 18 years, I was personally impressed 
with the dedication, commitment, and hard work that all of you put into 
serving this great country of ours. We feel strongly that the unique 
challenges that you face have never been greater than at this 
particular time in history, but there has never been a time in history 
when there has been a greater opportunity for the world to share in the 
accumulation of knowledge that could have healing and unifying 
consequences for all human populations. People around the world thirst 
and hunger for our democratic way of life which, in large part, is 
based upon scientific enterprise, which allows us to be a knowledge 
based and democratic society which prizes knowledge and objectivity, 
for supporting the health and economy of our political processes. We 
scientists are most appreciative to you for funding the most science-
based society ever.
    The University of Miami and Florida State University Risk 
Assessment and Intervention Consortium is dedicated to reducing the 
medical and social costs of health care through the development of 
cost-efficient, effective delivery interventions. All scientific 
enterprise faces major challenges today and we feel the proposed 
University of Miami/Florida State University Risk Assessment and 
Intervention Consortium will bring together scientists from a broad 
array of traditional research disciplines to face these challenges in a 
transdisciplinary and timely manner.
    In the last 50 years, tremendous strides relative to health and 
environment have been made in the biomedical, physical, psychological, 
economic, and social sciences to improve the world's health and 
environment. It now appears that the next major breakthroughs for 
improving quality of life and reducing socioeconomic costs lie at the 
intersections between scientific disciplines and not at the core of 
these sciences. Presently, these various sciences and the institutes 
that fund them, work too independently from one another to optimally 
address the broad and inter-related nature of these problems, and most 
scientists do not fully consider specific policy implications. 
Furthermore, traditional scientific research does not allow for the 
investigation of the most threatening risks in the most timely manner. 
My own scientific research is somewhat unusual in that I have conducted 
research and published in three broad disciplinary areas of cancer, 
HIV, and substance abuse. This perspective of more than 25 years made 
me yearn for a greater scientific enterprise that allows us to reach 
across these various disciplines in order to investigate problems more 
quickly and to apply the findings in a much more rapid manner.
    We feel that our Consortium will provide a partnership between 
science and government that will assure the most optimal and cost-
effective quality of life. The Consortium will identify individuals and 
risk groups that are at risk for specific adverse conditions, assess 
the manifestations of their risk and associated mechanisms and then 
communicate information about possible interventions and regulations to 
address such risks.
    Therefore, we feel that the model most capable both scientifically 
and administratively of combining disciplines to address policy 
implications for intervention, regulation, and control is that of 
compliance risk assessment. Risk assessment, as a field, incorporates 
scientists from a wide range of disciplines and directs their attention 
specifically to controlling, regulating, or intervening with 
populations at risk. At present, there is no identifiable, broad-based 
institution we know of that concentrates solely upon the full and 
complex range of risks utilizing multi- disciplinary and 
transdisciplinary science. The Consortium will be in a perfect position 
to improve quality of life, decrease mortality and morbidity and will 
also, through identifying risks earlier and by intervening earlier, be 
in a position to save many billions of dollars through the application 
of knowledge about early intervention.
    We know that intervention with effective prenatal programs saves a 
tremendous amount of money that otherwise would be spent on children 
after birth. The same could be said for early intervention at other 
points throughout the life cycle. Our own personal research experiences 
with the early detection of breast cancer have demonstrated through the 
screening of over 30,000 medically underserved women using an efficient 
mobile van visiting more than 12 primary health care centers that these 
programs not only save lives, but also save dollars. As is true for 
cancer, we already possess a great deal of knowledge that could be used 
to develop interventions as well as preventive strategies for many 
other diseases that present tremendous challenges throughout the world, 
such as HIV. Applying this accumulated knowledge could effect savings 
of billions of dollars for state, local, and national government, not 
only in the health arena, but also in preventing social and health 
pathologies of juveniles and young adults, as well as middle aged and 
older citizens. Early interventions would affect costs savings not only 
for public health systems, but also for the juvenile and criminal 
justice systems, the educational and welfare systems, as well as to 
private insurers and non-profit and volunteer organizations, many of 
which support interventions. With the increasing costs of 
institutionalization and public subsidies, every person whom we prevent 
from being institutionalized or dependent on public subsidies will not 
only save governmental dollars, but will also add to the economy of the 
country. Just as important, the quality of life for these individuals, 
their families, and their communities, as well as society at large, 
will be improved. It is becoming ever more apparent that we, as a 
nation, cannot afford to ignore prevention and early intervention 
strategies since crisis management is much too costly in terms of 
quality of life and unnecessary expenditures of dollars.
    Our proposed organization will be cross interdisciplinary 
boundaries to accomplish goals that, for the most part, presently are 
hampered by too much independence of the various sciences and 
institutes conducting such science. We, however, have an opportunity to 
recognize the enviable talents of academic scientists within our broad-
based risk consortium which will forge novel and, hopefully, permanent 
collaborations between universities and policy makers.
    We thank you very much for your valuable time and stand ready to 
serve you in any way possible.
                                 ______
                                 
 Prepared Statement of the University of Medicine and Dentistry of New 
                             Jersey (UMDNJ)
    We respectfully present testimony of the University of Medicine and 
Dentistry of New Jersey (UMDNJ), the largest public health sciences 
university in the nation. The UMDNJ statewide system is located on five 
academic campuses and consists of 3 medical schools and schools of 
dentistry, nursing, health related professions and biomedical sciences. 
It also comprises a University-owned acute care hospital designated as 
the State's Level One Trauma Center, three core teaching hospitals, an 
integrated behavioral health care delivery system, a University-owned 
managed care network and affiliations with more than 100 health and 
educational institutions statewide. No other institution in the nation 
possesses resources which match our scope in higher education, health 
care delivery, research and community service initiatives with state, 
federal and local entities.
    We appreciate this opportunity to bring to your attention some of 
the University's priority projects which we believe are consistent with 
the mission of this committee. The following is an outline of each of 
these initiatives for your consideration.
                 international center for public health
    The International Center for Public Health is a strategic 
initiative that will create a world class, infectious disease research 
and treatment complex in University Heights Science Park, Newark, New 
Jersey. Science Park is located in a Federal Enterprise Community 
neighborhood. The International Center will have substantial local, 
regional, national and international impact as it addresses many 
critical social, economic, political and health related issues. The 
Center is a $78 million anchor project that will launch the second 
phase of a 50-acre, $350 million mixed-use urban redevelopment 
initiative, University Heights Science Park. The facility will total 
161,600 square feet and house three tenants: The Public Health Research 
Institute (PHRI), the University of Medicine and Dentistry of New 
Jersey's (UMDNJ) National Tuberculosis Center, one of three Federally 
funded TB centers, and the UMDNJ New Jersey Medical School Department 
of Microbiology & Molecular Genetics. The International Center for 
Public Health is a priority project for UMDNJ, Rutgers University, the 
New Jersey Institute of Technology, Essex County College and the City 
of Newark.
    The core private tenant for the International Center is PHRI. PHRI 
is an internationally prestigious, 57-year-old biomedical research 
institute that conducts a broad range of infectious disease and public 
health research. A major PHRI research focus is the study of antibiotic 
resistance to life threatening bacterial organisms, and the development 
of new antibiotics. Among its many accomplishments over the years, PHRI 
has contributed to the development of smallpox vaccine, developed a new 
diagnostic assay for influenza, conducted early experiments on 
oncogenes, cloned the gene responsible for toxic shock syndrome, and 
identified the multi-drug resistant TB strain ``W''. PHRI's current 
research centers on molecular pathogenicity, drug discovery, drug 
resistance, diagnostic and vaccine development, and gene expression. 
Scientific disciplines include virology, immunology, biochemistry, 
genetics, cell and structural biology, and regulation of cell 
development. Presently, PHRI supports a staff of 110, including 20 
Principal Investigators. These numbers will double in the move to the 
International Center.
    UMDNJ will be the primary medical center linkage and academic 
affiliation for the Public Health Research Institute. The New Jersey 
Medical School National Tuberculosis Center at UMDNJ, one of only three 
model Tuberculosis Prevention and Control Centers in the United States 
funded by the CDC, will add an important clinical component to the 
International Center, since many TB patients also manifest other 
infectious diseases. The TB Center was founded in 1993 as a response to 
the national resurgence of antibiotic resistant tuberculosis strains. 
At the time, Newark had the nation's second highest rate of TB cases 
for a major city. Rounding out the International Center's initial 
tenants will be the UMDNJ-New Jersey Medical School's Department of 
Microbiology & Molecular Genetics. The Department's relocation will add 
a staff of 100 to the Center's critical mass of microbiology research. 
Currently the 17-member faculty conducts research in control of cell 
proliferation; cellular aging; transcriptional, post-transcriptional, 
and transcriptional regulation; mutagenesis; DNA replication and 
recombination; chromosome structure and segregation; human molecular 
genetics; and molecular pathogenesis of viruses, bacteria and 
parasites.
    Together PHRI, the National TB Center and the Department of 
Microbiology & Molecular Genetics are creating a world class research 
and treatment complex that will have substantial local, regional, 
national and international impact. Other collaborators in the 
development of the International Center include the New Jersey 
Department of Health & Senior Services (NJDHSS) and the pharmaceutical 
industry. Responsible for overseeing all statewide public health 
initiatives, NJDHSS will contract with the International Center to have 
cutting edge molecular epidemiology services provided to the State of 
New Jersey. Expanding the strategic use of molecular epidemiology to 
direct public health activities will facilitate prompt identification 
and containment of emerging and re-emerging pathogens. New Jersey's 
major biomedical companies will also participate in the International 
Center. An infectious disease consortium will be developed to serve as 
a forum for disseminating fundamental research on the underlying 
molecular processes of infectious disease organisms. This research will 
contribute to pharmaceutical industry development of new drug therapies 
for antibiotic resistant microorganisms. Private industry R&D 
facilities contiguous to the International Center are also being 
explored.
    The International Center for Public Health (ICPH) is a creative and 
unique public/private partnership located in University Heights Science 
Park, Newark, NJ, that will combine: infectious disease research 
pharmaceutical industry participation, international, State and 
regional public health collaborations, high school urban and minority 
science education initiatives, urban economic and community 
redevelopment, and high technology job creation in a federally 
designated Enterprise Community.
    Through the leadership and direction of the Governor Christine Todd 
Whitman, a Memorandum of Understanding (MOU) was signed between the 
State of New Jersey, UHSP, UMDNJ and PHRI in October 1997. The MOU 
commits $60 million of State loan and grant funds toward development of 
the $78 million International Center for Public Health. Science Park is 
working closely with the New Jersey Economic Development Authority, 
through whom project bonds will be issued and 14-acres of land 
acquired. Presently the Science Park partners and International Center 
for Public Health tenants are seeking the remaining $16 million from 
Federal and private sources during 1998. Groundbreaking is scheduled 
for March 1999.
    University Heights Science Park is requesting $3 million from the 
Senate Appropriations Subcommittee on Labor, Health & Human Services 
and Education for fiscal year 1999 to support the Phase II development 
of Science Park: the construction of the International Center for 
Public Health. Such support will leverage Phase II development that 
totals $138M, and creates nearly 3,000 direct and indirect construction 
and permanent technology jobs. These funds will be used specifically 
for construction related project costs.
                  child health institute of new jersey
    Disorders of health affecting infants and children exact a terrible 
toll, in both human suffering and economic impact, on the child, family 
and the community. Consequently, State and Federal public policy 
prioritizes efforts to prevent or treat disorders of infancy and 
childhood. The prevention of conditions such as mental retardation, 
muscular dystrophy, sickle cell disease or cystic fibrosis has nearly 
incalculable benefits to society. Neither New Jersey nor New York hosts 
a research center designed and developed specifically to address issues 
of child health.
    The University of Medicine and Dentistry of New Jersey- Robert Wood 
Johnson Medical School (UMDNJ-RWJMS) proposes to develop the Child 
Health Institute of New Jersey (CHINJ), a comprehensive biomedical 
research center focused on the health and wellness of children. In this 
program, medical researchers will direct efforts towards the prevention 
and cure of environmental, genetic and cellular diseases of infants and 
children.
    The Institute will be located in New Brunswick and linked 
physically and programmatically with both UMDNJ-RWJMS and the 
Children's Hospital at Robert Wood Johnson University Hospital (RWJUH). 
This organization reinforces the relationship between essential 
biomolecular research and the treatment, prevention and cure of 
disorders of infancy and childhood. Locating the Child Health Institute 
in New Brunswick promotes the development of new partnerships among the 
Institute, the Medical School, the teaching hospitals affiliated with 
UMDNJ-RWJMS, and with the multinational pharmaceutical, biotechnology 
and chemical interests throughout New Jersey.
    The CHINJ will act as a magnet for additional growth in research 
and healthcare program development in New Brunswick and New Jersey. New 
Brunswick provides a central location in the state that offers ease of 
access and proximity to major highway systems and mass transit; this is 
essential, as no similar program exists in either New York or New 
Jersey. The state of New Jersey, which has significant concerns in the 
areas of infant mortality, neonatal HIV infection and pediatric cancer, 
will benefit directly and enormously from the unique presence and 
impact of the Child Health Institute of New Jersey.
    The Institute will focus research on the molecular and genetic 
mechanisms which direct growth, wellness, and disease. Examples of the 
Institute's research foci include: the identification and functional 
analysis of genes contributing to developmental disabilities and 
abnormal development; developmental pharmacology relating growth and 
maturation to the processes that regulate drug metabolism, 
developmental toxicity, and resistance or susceptibility to toxic 
agents; genetic and environmental influences on developmental 
immunology; the molecular mechanisms underlying brain growth and 
development; and tissue degeneration and regeneration.
    The Child Health Institute of New Jersey builds on existing 
significant strengths in genetic, environmental, and neurosciences 
research within the UMDNJ-Robert Wood Johnson Medical School and 
associated joint UMDNJ-Robert Wood Johnson Medical School-Rutgers 
University research institutes. For example, the Environmental and 
Occupational Health Sciences Institute (EOHSI) is a National Institute 
of Environmental Health Sciences (NIEHS) recognized center of 
excellence which investigates environmental influences on normal and 
disordered functions; The Cancer Institute of New Jersey (CINJ), a 
National Cancer Institute-designated Clinical Cancer Center, studies 
disordered cell growth; The Center for Advanced Biotechnology and 
Medicine (CABM) characterizes gene structure and function.
    The proposed Child Health Institute of New Jersey, which is 
formally chartered with defining developmental mechanisms, will 
complement and focus developmental programs within these Institutes and 
other areas of the University of Medicine and Dentistry of New Jersey.
    The University of Medicine and Dentistry of New Jersey seeks a $5 
million infrastructure development and targeted program assistance for 
the Child Health Institute of New Jersey. As indicated above, the 
program has already received initial funding support from Johnson & 
Johnson and the Robert Wood Johnson Foundation in the amount of 
$850,000. Efforts to obtain additional private support are underway and 
will be ongoing.
The Dean Gallo Prostate Cancer Institute
    Prostate cancer is a particularly devastating problem in New 
Jersey. With the highest population density in the country, at 1,000 
people per square mile, we are ranked 10th of all the States in 
mortality prostate cancer. African Americans diagnosed with prostate 
cancer are twice as likely to die from it, and New Jersey is ranked 8th 
in the nation for this disease in this ethnic group. There is no 
available curable treatment for prostate cancer once it recurs, and 
when it does, it is uniformly fatal. The objectives of the Dean Gallo 
Prostate Cancer Institute are:
  --Regionally, to provide the highest standard of care, including NCI-
        approved trial therapies, to all residents of the area who 
        suffer from prostate cancer. In addition, we will provide 
        outreach and education in the community to generate early 
        detection of the disease.
  --Nationally, to make significant contributions to the nation's war 
        on this disease through basic science discoveries on how 
        prostate cells become malignant, ways to prevent transformation 
        to cancer, how prostate cancer cells evade therapies, and the 
        development of novel treatments for advanced stages of the 
        disease.
    The Cancer Institute of New Jersey (CINJ) is the only NCI-
designated Clinical Cancer Center in the State. It is affiliated with 
the University of Medicine and Dentistry of New Jersey (UMDNJ), and is 
located at that institution's Robert Wood Johnson Medical School in New 
Brunswick, New Jersey. CINJ has over 200 members including 35 staff 
physicians, physician/scientists, and basic science researchers. 
Because of the devastating problem of prostate cancer in the state and 
in the nation, CINJ has determined to make the development of a cure 
for this disease one of its major goals. To accomplish this we have 
initiated the development of the Dean Gallo Prostate Cancer Institute, 
named for Congressman Dean Gallo, who was a tireless supporter of the 
people of New Jersey. He believed in making our state stronger by 
collaborating with his colleagues to secure federal funding for 
initiatives that improve the quality of life for all citizens. 
Tragically, he died of prostate cancer in 1994 after being diagnosed in 
an advanced stage of the disease.
    CINJ is physically located in New Brunswick but has statewide 
presence through its hospital partners and affiliates. CINJ has grown 
rapidly through the cooperative efforts of these partners and 
affiliates, generous grant support from the Robert Wood Johnson 
Foundation, Johnson & Johnson, as well as many other New Jersey based 
foundations and corporations.
    To address the specific portion of our objective to make treatment 
available to all area residents, the Dean Gallo Prostate Cancer 
Institute will be incorporated into the statewide network of affiliated 
hospitals and providers. This network allows CINJ to facilitate 
treatments and research for prostate cancer. Patients with advanced, 
incurable, prostate cancer may therefore be enrolled into clinical 
trials at several locations throughout the state. This not only allows 
us to treat more patients with novel therapies but also increases our 
ability to rapidly evaluate these therapies. CINJ is also working with 
local clinics and agencies to develop treatment plans for uninsured 
sufferers of prostate cancer.
    The proposed budget for the Gallo Institute is $9.4 million to be 
spent over a 5-year period. We expect to raise substantial funds 
through private, corporate, and other resources. We therefore seek an 
allocation of $5 million to facilitate the establishment of this 
important resource. These funds will not be used for bricks and mortar, 
but to secure the resources necessary to conquer this disease.
Institute for Disability Prevention and Wellness
    Today, 1 out of 7 Americans--38 million people--have a disability; 
approximately 30 million Americans live with chronic pain. Millions 
suffer limited mobility brought about by injury, disease, and the 
natural process of aging. The effects are staggering: job related 
disorders themselves account for 1.9 billion days of restricted 
activity, 600 million days of bed rest, and $13 billion in health care 
costs. The impact of disability increases with the years, so that 40 
percent of the population over age 65 is affected.
    The University of Medicine and Dentistry of New Jersey--School of 
Osteopathic Medicine (UMDNJ-SOM) proposes to develop the Institute for 
Disability Prevention and Wellness (IDPW), an integrated basic science 
and clinical research program focused on the areas of pain and 
mobility. Two age groups are specially targeted: The working age adult, 
for whom these problems impact economic productivity, and the geriatric 
population particularly at the end of life for whom the quality of life 
can be improved by small changes in functional abilities.
    The Institute will be located in Stratford New Jersey and linked 
physically and programmatically with the UMDNJ-SOM, particularly 
programs in primary care, geriatrics, and basic science. It will focus 
on clinical and translational research and on development of clinical 
researchers with a dedication to primary care, and prevention and 
treatment of disability. By developing preventive models and new 
standards of care, it will arm primary care clinicians with the most 
recent knowledge and up to date methods to diagnose and treat chronic 
conditions at the most effective and least expensive stage. It will 
also allow these primary clinicians to effectively counsel their 
patients on avoidance of injury and disability by adoption of lifestyle 
practices fostering health and wellness. Through this unique emphasis 
on improving primary care, the Institute has the potential to influence 
the course--and the cost--of healthcare well into the next century.
  --To establish a center to prevent and reduce disabilities that 
        impact mobility and physical functioning. In the osteopathic 
        tradition, the center will use intervention techniques drawn 
        from all aspects of medicine, including manual therapy as well 
        as medication and exercise.
  --To promote primary and secondary wellness through lifestyle and 
        behavioral modification, thereby reducing the morbidity, 
        mortality and disability associated with chronic disease. For 
        example, by developing new methods of treating muscle weakness 
        or fatigue the Institute will be able to develop programs that 
        will be applicable to persons who suffer from a wide variety of 
        conditions.
  --To improve physician education at the medical student, resident, 
        and faculty level by maintaining a link between clinically 
        relevant problems and basic and applied research. Involvement 
        in clinical trials is a key to the educational effort, as well 
        as to the development of the treatments themselves.
  --To provide preventive services for patients suffering from chronic 
        disease with the emphasis on quality of life and end of life 
        issues.
  --To establish an extramurally funded research program, drawing on 
        State and Federal as well as private resources.
    We seek $4 million to develop an Institute for Disability 
Prevention and Wellness that will focus on education, research and 
training in geriatrics, primary care and osteopathic medicine.
                                 ______
                                 
        Prepared Statement of the National Hemophilia Foundation
    Thank you for the opportunity for the National Hemophilia 
Foundation (NHF) to submit testimony to the Chairman and Members of the 
Appropriations Subcommittee on Labor, Health and Human Services, 
Education, and Related Agencies. NHF is a national voluntary health 
organization dedicated to improving the health and welfare of people 
with hemophilia, von Willebrands disease, and other bleeding disorders. 
The federally-funded hemophilia and hematologic programs provided for 
in the annual Labor, Health and Human Services Appropriations Bills are 
of great importance to the hemophilia community and to the general 
public who rely on the safety of the nation's blood supply. NHF 
appreciates the Committee's continuing support in advancing the 
research, treatment, and consumer-based patient outreach needs of the 
hemophilia community.
    Hemophilia is a lifelong hereditary blood clotting disorder 
affecting an estimated 20,000 persons in the United States. Throughout 
their lives, people with hemophilia are dependent on clotting factor to 
supply a missing protein, which allows their blood to clot normally. As 
such, the hemophilia community continues to be the first marker in the 
event of any complication or virus that contaminates the blood supply. 
Historically, the hemophilia community has been impacted by a number of 
viruses through the blood supply. While HIV has been the most 
devastating, other viruses continue to plague the hemophilia community, 
including hepatitis.
    Last year the Committee included in its fiscal year 1998 report a 
series of actions to be taken by the Public Health Service agencies to 
improve surveillance, research, patient notification, and outreach 
efforts in addressing blood safety concerns. Programs funded by the 
Committee also provided for hemophilia and bleeding disorder programs 
aimed at HIV/AIDS risk reduction and clinical studies, prevention of 
the complications of bleeding disorders, and research for a cure for 
hemophilia and related disorders.
             advancing hemophilia research and blood safety
    With regard to programs appropriated under the Labor, Health and 
Human Services, Education Appropriations Bill, NHF strongly believes 
that research efforts should continue to:
  --Develop gene therapy technologies for hemophilia as an alternative 
        to blood-based products,
  --Strengthen our knowledge about the treatment of and prevention of 
        the complications of hemophilia, von Willebrands disease, and 
        other bleeding disorders, and
  --Substantially improve surveillance, patient notification, and 
        outreach efforts to address blood safety concerns.
              gene therapy for the treatment of hemophilia
    For persons with hemophilia, gene therapy offers a potentially much 
less expensive treatment option that would end decades of dependence 
upon blood-derived products. In a recent report to Congress, the 
National Institutes of Health (NIH) highlighted hemophilia as one of 
the diseases most likely to be treatable through gene therapy and as a 
potential model of how gene therapy may be utilized to treat other 
genetic disorders.
    Over the past few years, the House and Senate Labor, Health and 
Human Services, Education Appropriations Subcommittees have encouraged 
the National Heart, Lung, and Blood Institute (NHLBI) to continue 
support for hemophilia gene therapy research. This year NHF is 
requesting Appropriations support to:
  --NHLBI: Provide an additional $2.5 million, doubling the level of 
        support for the hemophilia gene therapy program. This will 
        allow not only for renewal but also expansion of the hemophilia 
        gene therapy grant program; and provide funding of an biannual 
        scientific conference to advance hemophilia gene therapy 
        research.
  --NHGRI/NIDDK: Coordinate research efforts between NHLBI and the 
        National Human Genome Research Institute (NHGRI) and the 
        National Institute of Diabetes and Digestive and Kidney Disease 
        (NIDDK), working with the National Hemophilia Foundation, to 
        pursue research on gene expression and immunity needed to make 
        gene therapy technology available to the hemophilia community.
            research to prevent complications of hemophilia
    Because of the hemophilia community's dependence on blood products, 
hepatitis C continues to be a serious ongoing concern. More than 80 
percent of all persons with hemophilia in the United States. have been 
exposed to hepatitis C through the use of clotting factor. NHF requests 
Appropriations language encouraging:
  --NIAID/NIDDK: Increased funding of research on hepatitis at the 
        National Institutes of Allergy and Infectious Disease (NIAID) 
        and NIDDK, including research on optimal treatment regimes, 
        access to clinical trials, development of a vaccine, and 
        improved diagnostic testing for hepatitis C, as well as studies 
        on the impact of multi-drug therapy on the liver. Committee 
        report language should indicate that concern regarding the 
        impact of hepatitis C on the hemophilia community is a 
        priority.
  --NHLBI: Continued research support on preventing the complications 
        of hemophilia, von Willebrands disease, and other bleeding 
        disorders.
                              blood safety
    During the 1980's, over half of all persons with hemophilia in the 
U.S. were infected with HIV through the use of contaminated blood 
products. While blood products are now inactivated for HIV, blood 
products remain susceptible to viruses and pathogens.
    For the last two years, the House and Senate Appropriations 
Committees have included in their reports accompanying the Labor, 
Health and Human Services, Education Appropriations Bill and the 
Agriculture, Rural Development, Food and Drug Administration Bill, a 
series of actions to be taken by the Public Health Service to 
substantially improve surveillance, patient notification, and outreach 
efforts in addressing blood safety concerns. These directives have led 
to marked improvements in our nation's response to potential threats to 
blood safety.
    CDC: The Labor, Health and Human Services, Education Appropriations 
Subcommittees for several years have provided funding support for the 
Centers for Disease Control's (CDC's) hematologic and hemophilia blood 
safety initiative, including efforts in blood safety and the prevention 
of complications of hemophilia. NHF requests that an additional $1 
million be made available to:
  --Fully implement a nationwide surveillance system utilizing the 
        network of hemophilia treatment centers and a serum bank to 
        monitor, detect and warn of adverse events in the blood supply.
  --Establish a cooperative CDC/Food and Drug Administration (FDA) 
        early warning system to ensure immediate investigation of and 
        action on, any possible viral contamination in the U.S. blood 
        supply or blood products.
  --Expand hematologic outreach for the prevention of the complications 
        of hemophilia, von Willebrands, and other bleeding disorders.
    MCHB: NHF requests report language, calling for the Maternal and 
Child Health Bureau to maintain funding support for the 140 facilities 
that comprise the hemophilia treatment centers network in order to (a) 
sustain their treatment outreach to persons with hemophilia and (b) 
ensure their participation with CDC and FDA on blood safety 
surveillance and patient notification efforts.
    Thank you for the opportunity to provide this statement to the 
Committee.
                                 ______
                                 
  Prepared Statement of David Karlson, Executive Director, Society of 
                       General Internal Medicine
    Good morning, before I go into my prepared remarks, I'm going to 
ask you to step back and to imagine yourselves 10 years from now, sick, 
with a chronic illness. You still have a lot of life ahead of you, and 
you want to spend as little of it as possible in the hospital. You are 
being cared for by a doctor who is in training today. But that doctor 
hasn't been taught to care for your special needs in a home or 
outpatient setting, and worse yet, doesn't have at his or her disposal 
evidence about the most appropriate treatment that will lead to the 
best outcome for your problem. That's a real scenario-one that will 
occur, unless we fund AHCPR and Title VII programs at a level that will 
let them do their job.
    I am pleased to be here today on behalf of the Society of General 
Internal Medicine, an organization representing the nearly 3,000 
physicians who are the primary care internal medicine faculty of every 
medical school and major teaching hospital in the United States. SGIM 
members prepare medical students, residents and others to be primary 
care doctors for the 21st century and they conduct research that 
improves primary care delivery and patient care.
    Today I'd like to talk with you about two programs, AHCPR and Title 
VII.
    As you probably know, AHCPR funds support scientific study of the 
health care delivery system, providing the knowledge base that enables 
consumers, providers, the managed care industry, and others to function 
optimally in the health care system. Title VII provides outpatient and 
community- based training for those in academic institutions around the 
country, permitting the up-to-date training of primary care physicians 
for the 21st century. We believe that is in the nations' interest to 
increase funding for both of these programs.
                           title vii program
    Let's talk first about health professions training. As you know, 
medical practice has changed drastically over the last two decades, 
moving from a primarily hospital setting to the outpatient arena, and 
it will change even more in the next 10 years. In our teaching, we 
struggle daily to teach through evidence, rather than anecdote. After 
all, you want your care to be based on evidence-not anecdote.
    Unfortunately, our primary way of funding graduate medical 
education-that is, through Medicare, provides little support for 
training outside the hospital. This is a major impediment to training 
physicians who are prepared to practice in current and future 
environments and manage the ever growing population of patients with 
chronic illness. The funding level only works well if we want to train 
most doctors to practice in the past.
    General Internal Medicine/Pediatrics Title VII programs provide the 
major source of funding primary care training, permitting us to prepare 
health care professionals for 21st century practice, and to train them 
to care for underserved populations, which will in all likelihood still 
be with us.
    SGIM is particularly proud of the track record of the Title VII-
supported General Internal Medicine grant programs. Over 69 percent of 
HRSA-funded internal medicine program graduates go on to primary care 
practice after graduation--nearly twice the rate of internal medicine 
programs without Title VII funding. Further, over 40 percent of 
internists trained through Title VII-supported programs have 
established practices in medically underserved communities in the past 
two years. You should know that the appropriation for the General 
Internal Medicine program in fiscal year 1998 was insufficient to 
permit the funding of new or competing renewal applications. While we 
recognize that your support has allowed these programs to survive at 
all, we urge you to fund Title VII at a level that actually lets it get 
the job done.
                                 ahcpr
    Let's shift gears, and talk about AHCPR. As you probably know, the 
Agency for Health Care Policy and Research is one of 3 science agencies 
in the federal budget that are necessary to maintain and improve the 
health of our nation. NIH develops new laboratory-based knowledge that 
will someday be translated to clinical application at the bedside. The 
CDC provides the science for public health. Despite this, you and I 
hear all the time the cries of alarm at the state of our health care 
system. There's a serious disconnect here. It is AHCPR that supports 
the discovery of new knowledge that can improve the health care system, 
and can identify the highest quality, most cost effective ways to get 
scientific breakthroughs into the health care delivery system in 
America. Yet, it is an agency that is seriously underfunded.
    Just like at the NIH, some of the best work comes from investigator 
initiated programs, but inadequate funding means that the AHCPR can 
support only a very small handful of individual investigators. Many 
like myself no longer even bother to prepare grant proposals for the 
AHCPR because the funding prospects are so bleak. Since 1994, the AHCPR 
has cut the number of funded investigator grants by over 50 percent. 
Ultimately, this translates into denied opportunities for the American 
public, and for you, the Congress, to make wise policy choices and save 
money. It may mean that we don't have the evidence to best treat your 
problem 10 years from now, and will have to rely on anecdote instead.
    On a positive note, let me give you a couple of examples of recent 
research released by the Agency, because it is this type of research 
that both improves quality of care and cuts health care costs, that a 
funding increase could support.
    Middle ear infection is the most frequent diagnosis requiring 
antibiotics for children in the United States. AHCPR-supported research 
at the University of Colorado found that common ear infections in 
children with less expensive antibiotics, instead of more expensive 
ones could save millions of dollars a year without changing recovery 
rates. The study estimated that in one state alone, and one program 
alone, the Colorado Medicaid program could have saved almost a half 
million dollars by implementing this change in treatment.
    Research supported by AHCPR also leads to the development of new 
technology that can be applied to make the functioning of the health 
care system more efficient. Recently, a tool to predict whether someone 
with chest pain is actually having a heart attack has been shown to 
reduce unnecessary coronary care unit admissions by 30 percent. This 
translates into 250,000 fewer critical care admissions or $3 billion 
savings per year in the U.S.-by all standards a great return on 
investment.
    In the past few years, the AHCPR has worked with private managed 
care companies to develop methods that can be used by average consumers 
to rate their local managed care plans. The Agency has also worked with 
the Health Care Financing Administration to improve way to assess 
beneficiary needs and satisfaction, for both the managed care and the 
fee-for-service system.
    AHCPR also support work in rural communities, where different 
solutions to keep primary care providers in rural areas have been 
identified.
    Just as the National Institutes of Health trains investigators to 
conduct basic research, the AHCPR trains physician-scientists to 
examine how our health care system works, and to develop more cost- 
effective approaches to make our population healthier and produce 
better health care outcomes. Both the Institute of Medicine and the 
National Academy of Sciences have called for at least tripling the 
numbers of health services researchers trained.
    In summary, the AHCPR's research programs are focused on topics of 
major concern to the Medicare and Medicaid programs and enable Congress 
and the public to discriminate between what we do, and what we know 
when we make health care decisions. In just one example alone, I've 
shown you how a small part of a $150 million investment, translates 
into cost savings of $3 billion. Its a great example of fiscal 
responsibility. On behalf of SGIM, I strongly urge you to provide a 
substantial increase to the AHCPR to expand its activities. Budget 
Recommendations
    Mr. Chairman, our funding recommendation for the Title VII Internal 
Medicine/Pediatrics programs is for $25 million this year. This will 
allow for growth within the program, but it will take closer to $50 
million if you are serious about actually getting the job done in the 
future. Our recommendation of $306 million for the entire Title VII 
program reflects the recommendation of the Health Professions and 
Nursing Education Coalition.
    For the AHCPR, we will ask you to provide the funding necessary to 
repair the damage done over the past three years to the investigator-
initiated grant program and to the training program. We recommend an 
AHCPR budget of at least a $175 million--a $32 million increase. We 
urge that this entire increase be allocated to the extramural 
investigator-initiated grant program, with 2 million set aside for new 
training programs.
    I would like to close by thanking this Subcommittee for its strong 
support of the Title VII program and the AHCPR. I would be pleased to 
respond to questions.
                                 ______
                                 
Prepared Statement of Ralph G. Yount, President, Federation of American 
                   Societies for Experimental Biology
    Mr. Chairman, Mr. Harkin, Members of the Subcommittee: I am Ralph 
Yount, professor of biochemistry at Washington State University. I am a 
basic scientist who works on the mechanism of muscle contraction. My 
research has been funded for 37 continuous years by NIH. I serve this 
year as the President of the Federation of American Societies for 
Experimental Biology, usually referred to as FASEB. Founded in 1912, 
FASEB is the largest organization of life scientists in the United 
States with a combined membership of more than 52,000 researchers. It 
is in my role as President of FASEB that I appear before you today to 
testify in support of the goal of a 15 percent increase for the 
National Institutes of Health in fiscal year 1999 as the first step in 
doubling funding over the next five years.
    Let me note at the outset that the Federation is very pleased by 
the budget request submitted by the President, and by his strong 
statements in favor of biomedical research during the State of the 
Union address. While we are hopeful that Congress can go even further 
than the President has proposed, we appreciate that this is the first 
time since the ``War on Cancer'' was proposed in 1971 that a President 
has so aggressively supported funding for the NIH.
    Following the lead of this Subcommittee, and in particular its 
Chairman, it appears that the President and our champions on the 
Appropriations Committees--Senate and House, Republicans and 
Democrats--all now support a significant increase for NIH this year. We 
join with you in a common effort to convince the full Congress that 
this goal is fully justified and achievable.
    FASEB believes the Congress should review NIH funding decisions in 
the context of the remarkable accomplishments that past investments 
have produced, as well as the substantial evidence which exists of 
unrealized scientific opportunities. Half a century of public 
investment in the NIH has fostered the development of a biomedical 
research enterprise, which is the envy of the world. The scientific 
investigations supported by NIH have given birth to the biotechnology 
industry, fueled the activities of the pharmaceutical industry, altered 
the daily course of health care in this country for every American and 
are even changing the nature of agriculture. The list of recent 
discoveries is remarkable.
    Three examples illustrate the range of progress being made every 
day:
  --NIH supported research led to development of defined fragments of 
        DNA on chips, the so-called gene chips which promise to 
        revolutionize the detection of certain gene-based diseases, 
        such as breast cancer.
  --NIH researchers have identified a crucial enzyme, telomerase, which 
        plays a significant role in cancer, normal growth and possibly 
        the fundamental process of human aging.
  --A recent NIH funded molecular genetics study has led to a possible 
        method for resensitizing bacteria, critical to dealing with the 
        spread of antibiotic resistant strains of these dangerous 
        organisms.
    The tragedy of these examples is that so many more breakthroughs 
are possible. In 1998 NIH will be able to fund only about three out of 
ten proposals approved by study sections. The success rate for new 
investigators who have not previously had a grant is substantially 
lower--only slightly better than 1 in 10. These are abysmal and 
discouraging odds. We believe these unfunded applications and unfunded 
researchers represent the best argument for increased support for the 
NIH.
    FASEB comes to you not only as an advocate for more money, but also 
to express our views on the priorities for most effectively utilizing a 
substantial increase in NIH funding. These proposals are not ``etched 
in stone'' but represent a starting point for discussions within the 
NIH and this committee. Briefly, FASEB recommendations are that 
increased funding be invested in the following areas:
  --Fund increased numbers of research grants developed through the 
        existing system of investigator initiated projects, selected 
        through rigorous competitive review by scientific peers;
  --Adequately fund research projects by increasing the average size of 
        grants;
  --Raise stipends for pre- and post-doctoral trainees to a living 
        wage;
  --Modernize the research infrastructure--including facilities, 
        instruments and clinical research support mechanisms;
  --Support a wide variety of new scientific partnerships, including 
        more extensive direct support by NIH for relevant studies in 
        chemistry, physics, mathematics and computational science;
  --Develop and support mechanisms for more rapidly translating 
        research findings from the laboratory to the clinics and 
        beyond; and
  --Increase the average length of grants to create a more stable 
        research environment.
    Mr. Chairman, these are FASEB's suggestions as you and the NIH 
begin the difficult task of deciding how best to invest the increased 
resources for biomedical research that we all hope can be found. We 
have also made other policy recommendations in our formal report 
previously submitted to the committee, which we hope you will review 
carefully.
    In conclusion Mr. Chairman, we at FASEB believe this represents the 
best opportunity in a generation to expand our country's historic 
effort to improve America's health, using the tools of science. FASEB 
recognizes the challenge this represents and we pledge to use all the 
resources available to us to convince the Congress to support the 
budget allocation needed to make our mutual goal a reality.
    Mr. Chairman, this concludes my statement.
                                 ______
                                 
    Prepared Statement of Mary Woolley, President, Research!America
    Chairman Specter and members of the Senate Appropriations 
Subcommittee on Labor, Health and Human Services, Education and Related 
Agencies, Research!America thanks you for the opportunity to provide 
this written testimony on the President's fiscal year 1999 budget 
request. The testimony will specifically comment on the requested 
increases in funding for scientific research, in particular research 
conducted at the National Institutes of Health (NIH).
    Research!America, a national not-for-profit public education and 
advocacy alliance, is dedicated to making medical and health research a 
much higher national priority. On behalf of its more than 350 members--
individuals, academic institutions, corporations and voluntary 
organizations--Research!America is proud to serve as a voice for 
citizens on the issue of medical research. The bottom line is that 
citizens want more research funded than is called for in the 
President's 1999 fiscal year budget.
    Since 1992, Research!America has commissioned both national and 
state-based public opinion polls and has regularly conducted focus 
groups to explore attitudes and identify citizens' issues and concerns 
regarding research. The poll results have consistently shown that 
citizens place their trust in research and research-based institutions 
to make the discoveries that will translate hope into cures, treatments 
and preventions.
    Along with the American Medical Association, the Ad Hoc Group for 
Medical Research, the National Health Council, the Biotechnology 
Industry Organization (BIO) and the many others concerned, 
Research!America is convinced that because we have in place an army of 
gifted researchers, and because the opportunity in science is at an 
extraordinary level, Now is the time to substantially increase funding 
for the National Institutes of Health. Now is the time to make the 
commitment toward doubling funding for medical research over the next 
five years.
    The public supports this increase as is evident from the results of 
our most recent polls completed in March of this year which found that 
in the aggregate, 60 percent of citizens surveyed say they favor 
doubling funding for medical research. Research!America has now asked 
citizens in Alaska, Connecticut, Louisiana, Michigan, Missouri, Ohio, 
Pennsylvania, Virginia, Washington, West Virginia and Wisconsin about 
doubling funding for medical research and the majority of citizens in 
every one of these states say they favor such a proposal. A national 
poll conducted by the Wall Street Journal and NBC found that, by a 
better than two to one margin (or slightly better than our findings), 
the public favors doubling the current NIH budget of 13-plus billion 
dollars over a five year period.\1\
---------------------------------------------------------------------------
    \1\ Wall Street Journal, February 12, 1998: 64 percent favor; 25 
percent oppose.
---------------------------------------------------------------------------
    With the commitment of this subcommittee, accompanied, if 
necessary, by innovative additional funding mechanisms, doubling the 
NIH budget over five years can become a reality. Research!America has 
tested several possible mechanisms for identifying additional monies to 
supplement appropriated dollars to accomplish the doubling goal. One 
possible mechanism, currently hypothetical on the national level but in 
use in some states, is to allow taxpayers who will receive a tax refund 
to designate some of that refund to a special fund for medical 
research. In our national poll conducted in 1995, 60 percent said they 
would be willing to donate a portion of their tax refund--with the 
median amount donated being $23. According to 1997 Internal Revenue 
Service figures, about 80 million taxpayers--two-thirds of those filing 
returns--expected to receive a 1996 refund. If all 60 percent from our 
poll followed through with their intent and donated an average of $23 
each, 48 million taxpayers would donate $1.1 billion for research.\2\
---------------------------------------------------------------------------
    \2\ Internal Revenue Service, April 1997.
---------------------------------------------------------------------------
    Another mechanism, very timely in light of attention on a possible 
tobacco settlement, is Research!America's finding that 68 percent 
(aggregate) of those surveyed say they favor a proposed increase of 
$1.50 per pack of cigarettes over three years with about 30 percent of 
the annual proceeds used to fund medical research.
    A third mechanism involves the projected budget surplus. Citizen 
priorities for surplus-generated dollars has been tested by various 
polls of late. When Louis Harris and Associates asked citizens this 
past November how they felt about money from a budget surplus being 
used for additional spending on current programs, 81 percent said they 
would support surplus dollars going to medical research.
    While citizens strongly support increased funding for medical 
research, they do not want doubling the budget of the National 
Institutes of Health to come at the expense of other health and science 
programs.
    When coupled with medical knowledge gained from basic and clinical 
research, behavioral and health services research can lead to effective 
prevention programs in communities across this nation. The eradication 
of small pox, the decrease in the incidence of AIDS in the United 
States, the use of t-pa to prevent the side effects of stroke are just 
a few examples of what can be accomplished when medical and public 
health research are working together. Research!America polls show that 
citizens value public health programs, which include prevention 
research, and health services research. It is not surprising that there 
is such strong interest in prevention and outcomes research, since 
everyone would agree that the ultimate goal is to eradicate, not just 
ameliorate, dreaded diseases like cancer, AIDS, diabetes, heart disease 
and stroke. This public mandate translates to achieving stronger 
support for the Centers for Disease Control and Prevention and the 
Agency for Health Care Policy and Research, in tandem with increased 
support for the NIH.
    My final point is based on a finding from our polls that strongly 
supports federal investment in basic research. It is important to 
emphasize that all science--not just medical and health science--needs 
strong support in order for our national goal of better health and 
well-being to be met. New ideas and breakthrough technologies in fields 
such as engineering, physics, mathematics and chemistry have been 
instrumental to progress in the life sciences in the past; this 
important synergy must be nurtured as we move into the next millennium. 
Proposals for increased funding for basic science conducted under the 
auspices of several federal agencies including the NIH and the National 
Science Foundation must be sustained if we are to meet our nation's 
goals.
    Doubling the NIH budget in five years is the right first step in 
achieving the great promise of research. Doubling the NIH budget in 
five years would allow the 105th Congress to place its stamp on 
history, contributing in never-before-possible ways to the health and 
quality of life of all Americans. In poll after poll, the message is 
clear that citizens back you, their Senators, when it comes to seizing 
the opportunity that science offers at this moment in our history.
    The Research!America alliance is pledged to continue working to 
ensure that research has the chance to deliver on its promise. Through 
our polls and our 435 Project we are working in communities across the 
nation to answer citizens' questions about research and to encourage 
them to speak up in support of use of their tax dollars for this 
critical priority. Concurrently, we are connecting researchers to 
citizens so they can share their work with their home town communities 
and in so doing demonstrate their accountability for the taxpayer 
dollars they spend. Nothing less than the health and well-being of my 
family, and yours and every family in America is at stake; we put our 
trust in our elected officials to make the investments today so 
tomorrow we will speak of cancer, premature heart disease, AIDS, 
diabetes and a host of other dreaded diseases, as finally conquered by 
American scientific know-how.
                                 ______
                                 
  Prepared Statement of Dr. M. Susan Smith, on Behalf of the Regional 
                    Primate Research Centers Program
    Chairman Specter and Members of the Subcommittee: We the directors 
of the seven Regional Primate Research Centers thank you for the 
opportunity to submit written testimony on behalf of the Primate 
Centers Program. The seven Centers are located across the country in 
California, Georgia, Louisiana, Massachusetts, Oregon, Wisconsin and 
Washington, and each is affiliated with a distinguished university. The 
Centers receive support as part of the National Center for Research 
Resources of the National Institutes of Health (NCRR-NIH).
    Congress acted with great foresight in 1960 to establish the 
national Regional Primate Research Centers Program, in recognition of 
the importance of nonhuman primates in biomedical research. The funds 
appropriated to build the seven centers have been an excellent 
investment. As we look back over the nearly forty years since their 
establishment, it is clear that these Centers have provided specialized 
and unique scientific capabilities not available through any other 
program within the Department of Health and Human Services. The Centers 
are our nation's single major resource for the conduct of research 
which is dependent upon the use of nonhuman primates. With the ever 
increasing complexity and sophistication of research questions and 
methodologies, the Primate Centers Program is even more important today 
than when the centers were established.
    It is difficult to overemphasize the importance of nonhuman 
primates, monkeys and apes, in biomedical research. These animals share 
more than 90 percent of their genetic makeup with humans. This close 
genetic similarity makes the nonhuman primate an ideal animal model for 
the study and understanding of human health and disease processes. 
Nonhuman primates are often the vital link between basic research on 
one hand and human application on the other. In some cases, there is no 
suitable animal model, other than the nonhuman primate, for study of a 
disease. An example is AIDS, for which the nonhuman primate is the best 
and most appropriate animal model. Important scientific advancements 
resulting from nonhuman primate research abound in fields of 
neuroscience, reproduction, infectious diseases and developmental 
biology, among others. The seven Centers provide the resources, 
including the nonhuman primates, scientific expertise and specialized 
facilities and equipment, to conduct this research. Without the 
Centers, high priority biomedical research programs requiring nonhuman 
primates and supported by the NIH could not proceed. These include 
programs in AIDS and other infectious diseases, aging, cancer, 
neurodegenerative disorders such as Alzheimer's disease, senile 
dementia and Parkinsonism, heart disease, infertility, mental health 
disorders, organ transplantation, osteoporosis, Lyme disease, drug 
addiction, reproduction and behavior. These research programs address 
basic mechanisms underlying human health and disease, as well as 
development of therapy and methods of prevention of disease.
    The research programs on AIDS at the Regional Primate Research 
Centers serve as an example of the Centers' unique ability to respond 
to our nation's health needs. When AIDS was first recognized in the 
early 1980's, there were few laboratory animal models available to 
begin studies of this disease. Within a year of emergence of AIDS, the 
Regional Primate Research Centers identified a comparable disease in 
Asian monkeys, and shortly after the discovery of HIV, the virus which 
causes AIDS, the Centers identified a similar virus termed SIV or 
simian immunodeficiency virus. This virus produces a disease remarkably 
similar to AIDS and is recognized as the best animal model to study 
these types of viruses. More recently, the vaccine development programs 
within the Centers provide new hope of identifying a vaccine that may 
have the potential of preventing the disease. The Centers are also 
engaged in research to prevent the AIDS virus from being transmitted 
from HIV-infected mothers to their babies. Without the Regional Primate 
Research Centers, it is very likely that these important advances in 
the treatment and prevention of AIDS would not have occurred.
    A new area of research at the Centers has the potential to 
revolutionize the use of nonhuman primates in biomedical research. This 
research involves the use of the technique called ``nuclear transfer'' 
to produce genetically identical animals. The availability of 
genetically identical nonhuman primates would provide a powerful 
resource for biomedical research because it would eliminate genetic 
variation during experimental manipulation and allow for greater 
statistical validity with fewer animals. Such a primate resource would 
be analogous to the inbred strains of mice that have greatly 
facilitated studies on biological mechanisms, disease processes and the 
development of new treatments such as gene therapy. Research at the 
Centers has proven the feasibility of using nuclear transfer to produce 
genetically identical nonhuman primates, and current studies are 
underway to develop the technology so as to produce large numbers of 
these valuable animals. There are a number of new opportunities that 
would arise from the availability of genetically identical nonhuman 
primates. (1) Gene therapy and vector development. This animal model 
would permit the use of genetic manipulations to study molecular 
processes and treatments of human disease. (2) Immunologic studies. The 
elimination of genetic variability would permit important new studies 
of autoimmune diseases, organ or cell transplantation, and HIV vaccine 
development. (3) Genetic versus environmental factors as contributors 
to disease. Without the confounding influence of genetic variability, 
it will be possible to determine the contribution of stress, the 
environment or nutrition to a variety of conditions, such as 
cardiovascular disease or behavioral abnormalities.
    In addition to their roles as research centers, the Regional 
Primate Research Centers also serve as national resources to the 
biomedical community at large and as centers of primatology. As 
national resources, the seven Regional Primate Research Centers are 
indispensable to approximately 1500 scientists from universities, 
research institutes and laboratories across the country, as well as 
scientists from around the world, whose research requires nonhuman 
primates. The Centers provide the essential elements, such the animals, 
scientific and technical expertise, materials and facilities, necessary 
to conduct their research programs. For the most part, these 
scientists' research missions serve all of the categorical institutes 
of NIH and are dependent on the Regional Primate Research Centers. The 
scope and diversity of their research and the number of institutions 
served stress the importance of the resources of the Regional Primate 
Research Centers to the national biomedical research effort. In 
addition to serving investigators on-site, the Center's tissue 
distribution programs direct more than 10,000 specimens per year to 
laboratories throughout the country.
    As centers of primatology, the Regional Primate Research Centers 
house the largest and most diverse collections of nonhuman primates in 
the world. The Centers provide access to some 16,000 nonhuman primates, 
representing 21 species, that have been proven to be valuable for 
biomedical research. Many of the species are threatened with 
extinction, are embargoed from importation, and are of unique genetic 
background or possess other distinctive biologic characteristics which 
makes them irreplaceable. This resource can never be duplicated. The 
Centers also maintain breeding colonies for which much of the 
biomedical research community is dependent. As centers of primatology, 
the Regional Primate Research Centers also contribute to our 
understanding of these extraordinary animals with respect to their 
biology, diseases and husbandry requirements, knowledge that is 
essential for their preservation and their judicious use in biomedical 
research.
    The support for the research programs at the Centers is derived 
largely from the categorical institutes of the NIH. However, the 
support for the infrastructure of the Centers is provided through the 
NCRR, NIH. The infrastructure of the Centers provides the necessary 
resources to support the research programs. Appropriations for the 
Regional Primate Research Centers have not kept up with inflation 
during the past 10 years. In fact, in absolute dollars, appropriations 
have barely risen in some years, whereas they have actually declined in 
others. When the high costs of biomedical research are taken into 
account, the budget for the seven Centers has been eroded. This has 
inevitably led to reductions in resources made available to the 
biomedical research community. This ``no growth'' funding pattern has 
greatly hindered the Centers' ability to expand its current research 
programs and will be detrimental to the development of new research 
opportunities. During this time of expanding resources in support of 
NIH, we ask that appropriations for research resources not be 
neglected. We request that this Committee in its budget deliberations 
take action to reverse the current funding pattern for the Regional 
Primate Research Centers. We are currently operating on a budget that 
is approximately 20 percent below the NIH-peer reviewed and approved 
recommended levels. We ask you to increase the funding for the Primate 
Center Program, which will not only be an investment in the seven 
Centers, but will also benefit the biomedical research interests of 
essentially all of the divisions of NIH.
    We would like to thank the Committee for their support in providing 
NCRR with construction funds, which have been specifically designated 
for the Centers during the past two years. It is essential that this 
source of funds for new construction be continued if the Centers are to 
maintain their state-of-the-art facilities and equipment. With many of 
the facilities at the Centers nearing 30-40 years of age, it is 
imperative that we retain our ability to obtain funding for new 
construction that is necessary to support new scientific opportunities 
into the next century.
            Respectfully submitted,
                    Dr. M. Susan Smith, Director, Oregon Regional 
                            Primate Research Center, Oregon Health 
                            Sciences University, Beaverton, OR; Dr. 
                            Andrew G. Hendrickx, Director, California 
                            Regional Primate Research Center, 
                            University of California, Davis, CA; Dr. 
                            Ronald D. Hunt, Director, New England 
                            Regional Primate Research Center, Harvard 
                            University, Southborough, MA; Dr. Peter J. 
                            Gerone, Director, Tulane Regional Primate 
                            Research Center, Tulane University, 
                            Covington, LA; Dr. William Morton, 
                            Director, Washington Regional Primate 
                            Research Center, University of Washington, 
                            Seattle, WA; Dr. Joseph W. Kemnitz, Interim 
                            Director, Wisconsin Regional Primate 
                            Research Center, University of Wisconsin, 
                            Madison, WI; Dr. Thomas Insel, Director, 
                            Yerkes Regional Primate Research Center, 
                            Emory University, Atlanta, GA.
                                 ______
                                 
 Prepared Statement of the National Association of Nutrition and Aging 
                           Services Programs
    Chairman Specter and members of this Senate Appropriations 
Subcommittee: Thank you for the opportunity to provide written 
testimony to you regarding the Older Americans Act. I am Mary 
Podrabsky, a provider of Congregate and Home-Delivered Meal services in 
Seattle, Washington. I am also President of the National Association of 
Nutrition and Aging Services Programs (NANASP), a membership 
organization of direct service providers of meals and other nutrition 
services across America. It is on behalf of NANASP that I present this 
testimony.
    First, Chairman Specter, I wish to thank you for your historical 
leadership and support for all the programs of the Older Americans Act 
and in particular the effort you championed last year to secure 
increased appropriations for these vital community based services. Your 
work and the work of this subcommittee has had an impact that is felt 
and greatly appreciated in communities, large and small, in every 
State, Territory and Tribal Land in this Country.
    The Older Americans Act, as you know, provides a wide range of home 
and community based services for persons sixty years and older. These 
include such services as adult day care, transportation, information 
and assistance, elder abuse protections, nursing home ombudsman 
services, senior employment, chore services, services for native 
Americans and Hawaiians, legal assistance, and congregate and home-
delivered nutrition services. The Older Americans Act has established 
over the past thirty-three years an aging network comprised of the 
Administration on Aging, State Units on Aging, local Area Agencies on 
Aging and thousands of service provider organizations, who with paid 
and volunteer staff, provide millions of older Americans with needed 
services. It is through the provision of such services that America is 
growing old with dignity, pride and maximum independence.
    This hearing, however, is not about creating a network of quality 
aging services. That work has already been done and has evolved over 
the last three decades. This hearing is about increasing the capacity 
of that network and of aging service programs to meet the needs of a 
rapidly growing senior population. It is also about spending limited 
national resources wisely. Providing increased funding to support Older 
American Act programs, I think, accomplishes both goals.
    Congregate and Home-delivered Nutrition Services, the two primary 
services provided by NANASP members, are arguably the two most visible 
services of the Act. Congregate meals are served at over 15,000 meal 
sites throughout the country, providing 127 million meals a year to 2.3 
million people. Home-delivered meal programs, more commonly referred to 
as Meals-on-Wheels, provided 115 million meals to nearly 1 million 
homebound seniors.
    Nutrition Programs, authorized through Title III and, more recently 
Title VI, of the Older Americans Act, are now in their 25th year of 
operation and are considered a wonderful success story. During the last 
reauthorization of the Act, the U.S. Congress authorized the Department 
of Health and Human Services to conduct a comprehensive two year 
evaluation of the Elderly Nutrition Program to include both congregate 
as well as home-delivered nutrition services. The results of this 
exhaustive evaluation, conducted by Mathematica Policy Research, Inc. 
of Princeton, NJ, were published in June, 1996. The results ``show that 
the Elderly Nutrition Program has succeeded in accomplishing its 
mission of improving the nutritional intakes of elderly people, as well 
as in decreasing their social isolation.'' The evaluation also ``shows 
that the program is evolving to meet the changing needs of older people 
brought on by shifting demographics and changes in the health care 
system and public policy environment.'' Finally, the evaluation results 
state that ``the Elderly Nutrition Program is a highly successful 
program that has a positive influence on an overwhelming majority of 
its participants.''
    Congress stipulated in the Older Americans Act that services would 
be targeted to certain individuals by stating that ``preference will be 
given to providing services to older individuals with greatest economic 
need and older individuals with greatest social need, with particular 
attention to low-income minority individuals.'' The same Mathematica 
study cited above found that ``about one-third of Title III congregate 
participants and one-half of Title III home-delivered participants have 
incomes at or below the DHHS poverty threshold.'' Also, with regard to 
minority targeting, the study concluded that ``overall, racial and 
ethnic minorities constitute 27 percent of congregate and 25 percent of 
home-delivered participants'' and that ``almost all Title VI 
participants are members of minority groups, compared with 14 percent 
of the overall population age 60 and older.'' Furthermore, ``nearly 
four times as many Title III participants and nine times as many Title 
VI participants are low-income minorities, compared with the overall 
population age 60 and older.''
    Okay! The program works. It does what it is supposed to do. That 
places it in pretty select company, but does that necessarily mean its 
funding should be increased? I would say no, not necessarily, but there 
is more. For every federal Title III dollar spent on congregate 
nutrition services an additional $1.70 is raised from other sources. 
The amount of leveraging is substantially higher for Title III home-
delivered nutrition services. This kind of leveraging of public dollars 
in congregate and home-delivered meal programs make this a wise 
investment and a model public/private partnership.
    To be eligible to receive home-delivered meals, a participant needs 
to be, with few exceptions, not only sixty years of age or older, but 
also homebound. Often, the receipt of a meal is the only service 
required for these individuals to be able to remain in their own home. 
Home-delivered meals can be provided to a home bound person for an 
entire year for less than the cost of one overnight stay in the 
hospital! Audrey Baker , blind and recovering from a broken back, whose 
story is told in the attached article, must not be forced to wait any 
longer for meals. And Helen McCleery of San Diego, described in the 
same article, should not be required to find her food in dumpsters. It 
is just possible that for those in need of this service, it may be one 
of the best spent health care dollars.
    For most Nutrition Services providers in the Country, home-
delivered meals are increasing at a rate that far exceeds their 
capacity to meet the need. Four out of ten programs show a waiting list 
for home-delivered meals. One out of ten congregate meal providers have 
waiting lists, but there are not sufficient funds in these programs to 
establish new sites or to perform outreach efforts to locate isolated 
older persons in need of the services available at the congregate meal 
sites.
    Funding for the programs and services of the Older Americans Act 
have simply not kept pace with the increasing costs of providing the 
services and this at a time of historical low inflation.
    This fact, coupled with the steadily increasing numbers of frail 
older persons in need of the services, has stretched program capacity 
to its limits. There are no savings to be achieved by reducing services 
provided in the home and community if the only option remaining is more 
expensive institutional care. We must, as a Nation, provide for the 
most appropriate, least expensive service option possible at the 
earliest possible time. Only then can we be assured that we are 
spending dollars wisely. As we turn to face the new millennium, let us 
be able to face our mothers and grandmothers as well.
                                 ______
                                 
    Prepared Statement of Patricia Deitch, Chief Executive Officer, 
Philadelphia Health Services, on Behalf of the National Association of 
                        Community Health Centers
    Mr. Chairman and Members of the Subcommittee my name is Patricia 
Deitch. I am the Chief Executive Officer of Philadelphia Health 
Services. On behalf of the National Association of Community Health 
Centers, I am pleased to provide the Subcommittee with testimony in 
support of the urgent need to increase funding to $926 million for 
fiscal year 1999 for the Consolidated Health Centers Program (i.e., 
community, migrant, homeless, and public housing health centers). 
Health centers share a common mission of providing quality and cost-
effective health care to patients in urban and rural medically 
underserved areas, and it is for this mission and service to the nation 
that we ask the Subcommittee's continued strong support.
    First, I would like to thank the Subcommittee for its support of 
the consolidated health centers program over the past two years. Under 
the leadership of Chairman Specter, appropriations for the program have 
increased by $68 million in that period one in which the Subcommittee 
had to face many difficult choices among worthwhile programs. We are 
particularly indebted to Senator Christopher Bond and Senator Ernest 
Hollings for their efforts on our behalf during the last two years. We 
also would like to extend our best wishes to Senator Dale Bumpers in 
his final year of a tremendous career in public service. Arkansas 
health centers will miss his leadership and health centers throughout 
the nation will never forget his strong support of our program.
    The $68 million increase this committee has approved for health 
centers over the past two years is an investment towards providing 
services to uninsured patients and previously unserved patients. 
However, much more work needs to be done. The $68 million increase has 
only enabled health centers to serve approximately 250,000 people which 
is less than one percent of the nation's approximately 42 million 
uninsured people. Rising number of uninsured patients, coupled with 
eroding grant, Medicaid and other revenues, place health centers in a 
financial squeeze which literally threatens their viability. Most 
existing health centers have not seen an increase in their grant 
dollars for the past eight years, yet are being inundated with 
escalating numbers of uninsured. In the past three years alone, the 
number of uninsured people seeking care at health centers has increased 
by over one million.
    The financial squeeze health centers are experiencing is forcing 
many to cut services, staff and/or hours in order to remain operative. 
Nowhere are these trends more evident than in the State of Pennsylvania 
and at my health center, Philadelphia Health Services (PHS). We serve 
over 23,000 patients in our two Philadelphia locations. Between 1996-
1997, we have had a 6.4 percent decrease in our total revenue, while 
the number of uninsured patients has increased by 46 percent. The 
number of uninsured grew eight times faster between 1996-1997 than the 
previous year. In addition, we have experienced a 7.6 percent reduction 
in Medicaid revenues between 1996-1997. Medicaid losses for PHS will 
contribute to a $600,000 deficit in fiscal year 1998.
    In an effort to minimize the negative impact of Medicaid changes 
and declining revenues, PHS took several steps to contain costs while 
working toward identifying ways to increase revenues. For example, 
after closing our in-house laboratory due to financial constraints, we 
eliminated several necessary lab tests. Patients must now go to the 
costly hospital emergency room to receive a lab test. We have also had 
to discontinue our school-based wellness centers which provided on-site 
preventive, diagnostic educational services to junior high elementary 
children. In addition, our doctors were once able to visit patients 
that have been admitted into area hospitals to evaluate their 
conditions. Unfortunately, we have been forced eliminate this practice.
    In the past three years, PHS has been forced to eliminate 19 
positions including a pediatrician, physician assistant, an internist, 
health educator, and a nurse. We are unable to eliminate any additional 
staff without jeopardizing primary health care we deliver to our 
patients. The cuts in personnel have resulted in life altering 
consequences for our patients. For example, since we have had to 
eliminate the health educator's position, our patients can no longer 
receive intensive diabetes education after their doctor's visit. One of 
our patients recently diagnosed with the disease was prescribed oral 
medication and dietary changes. One day she was rushed to the emergency 
room with extremely elevated blood sugar level. She was admitted to the 
hospital to bring down her blood sugar level, was placed on insulin, 
and received 2 hours of instruction from a diabetic nurse as a hospital 
inpatient. Had our health center been able to retain our health 
educator and continue to provide intensive diabetes education, this 
patient would have received necessary education when she was first 
diagnosed, and possibly the trauma and expense of a hospitalization 
could have been avoided.
    Without an increase in grant funding, PHS will not be able to 
generate the revenue needed to continue providing our full scope of 
services beyond next year.
    The problems PHS is facing are echoed nationwide. There are 981 
community, migrant, homeless and public housing centers and FQHC look-
alikes serving over 2,500 communities across America. Together, these 
health centers care for over 10 million children and adults in every 
state, Commonwealth and Territories, and the District of Columbia. 
Health centers are local non-profit, community-owned health care 
programs serving low-income and medically underserved urban and rural 
communities with few or no resources. Health centers are governed by 
volunteer members of the community who have an interest and take 
responsibility to ensure that responsive and affordable health care is 
provided to all who need it. Patients are charged on a sliding fee 
scale to ensure that income or lack of insurance is not a barrier to 
care. Federal grants subsidize the cost of care provided to the 
uninsured and the cost of enabling services (such as translation and 
outreach) not covered by Medicare, Medicaid, or private insurance--
services which make the care provided by health centers cost-effective 
and responsive.
    Health centers are staffed with interdisciplinary teams of more 
than 6,000 physicians (98 percent of whom are board certified), as well 
as nurses, dentists, other health professionals and community 
residents. Health centers offer a wide range of primary and preventive 
medical and dental care, including: diagnostic laboratory and 
radiologic services, pharmaceutical services, immunizations, well-child 
examinations, preventive dental care, family planning, and prenatal and 
postpartum care. Health centers also provide health education, 
community outreach, transportation, and support programs (including 
literacy and other education programs) in collaboration with other 
organizations and agencies like schools, Head Start programs, and 
homeless shelters.
    Without health centers, residents of inner-city and rural 
underserved areas would face great unmet health care needs. Health 
center patients include uninsured low-income persons, minorities, rural 
residents, high-risk pregnant women and children, migrant and seasonal 
farm workers, persons with AIDS, persons with drug and alcohol 
problems, homeless persons and families, the frail elderly and other 
high-risk groups. Health centers have special expertise in meeting the 
unique needs of these most vulnerable populations and are often the 
only source of non-hospital, community-based primary care for them.
    The following reflect the profiles of health center patients:
  --Health centers serve one of every six low income children (4.5 
        million children).
  --In 1995, the 400,000 births to health center patients accounted for 
        one of every 10 births (and one of every five low-income 
        births) in the United States.
  --One in every 10 uninsured persons in the United States uses health 
        centers.
  --Health centers are the family doctor for one in 10 rural Americans.
  --One of every eight low income Americans uses health centers.
  --Almost 7 million minority persons are health center patients.
  --Health centers are the provider of choice for one of every 10 
        people covered by Medicaid.
  --Health centers care for one of every four homeless persons.
    There are over 42 million uninsured Americans who suffer financial, 
geographic or cultural barriers to health care. This number of 
uninsured Americans is growing rapidly, at a rate of 100,000 per month. 
Studies have shown that this number could reach 50 million or more over 
the next five years. Nearly three-fifths of the uninsured are members 
of low-income working families who cannot afford to buy health 
insurance, and must rely on the safety net for health care primarily 
health centers or costly emergency rooms.
    Many studies have concluded that health centers, in the process of 
providing primary care to medically uninsured and underserved 
communities, achieve real and significant cost savings. Through fewer 
hospital admissions and less frequent use of costly emergency care for 
routine services, health centers save the American health care system 
almost $12 billion annually.
    Few government programs have made as significant a contribution to 
low-income families as cost-effectively, or in high quality a manner as 
health centers. For example:
  --Health centers create jobs and provide an economic base: Health 
        centers employ more than 50,000 persons, many of whom are 
        community residents. They also help to retain other local 
        businesses and stabilize neighborhoods by bringing in other 
        forms of community or economic development. Health centers 
        generate over $14 billion in annual economic activity in many 
        of America's most economically depressed urban and rural 
        communities.
  --Health centers make a difference in the health of people: Studies 
        of health centers credit them for a 40 percent reduction in 
        infant mortality, improved immunization and prenatal care 
        rates, and increased use of preventive health services among 
        their patients.
  --Health centers triple the value of investment: Every $100 million 
        invested in health centers brings an additional $200 million in 
        other resources into communities, and helps 1 million people 
        (including 350,000 uninsured persons) get the care they need.
    Despite achieving remarkable progress in responding to the rapidly 
changing health care environment, health centers increasingly are 
feeling the strains brought on by the continuing erosion of private 
insurance coverage, stagnant or shrinking public subsidies, and the 
pressures of a restructured marketplace now driven by competitive 
forces. Over the past three years, centers have added more than one 
million new uninsured patients to their rolls. This growth in new 
uninsured health center patients is widespread and underscores the 
declining ability of providers in all communities to continue to serve 
the uninsured. This situation is certain to worsen causing more 
uninsured and low-income people to seek care at health centers.
    In addition, the changes in the Medicaid program have reduced the 
amounts available to health centers. Health centers lost almost 400,000 
Medicaid patients last year, principally because of State Medicaid 
managed care efforts. The most perplexing part of this is the fact that 
much of the loss is due to state auto-enrollment (or default 
assignment) procedures, in which health center patients who failed to 
choose a managed care plan were involuntarily assigned to plans that 
did not include their center in their provider network. At least 650 
patients were lost at my Philadelphia centers alone. Also, with the 
increased enrollment of Medicaid patients in managed care, health 
centers around the country are receiving decreased reimbursement for 
serving Medicaid patients. And, beginning in fiscal year 2000, the 
Balanced Budget Act will phase out and eliminate cost-based 
reimbursement for Medicaid patients. Even though health centers are re-
engineering their service delivery systems to become more efficient, we 
are caught in a tightening vise of reduced levels of reimbursement and 
increased numbers of uninsured. Health centers will again have to use 
grant dollars to subsidize the care of Medicaid patients.
    During testimony to the House Appropriations Subcommittee on Labor, 
Health and Human Services and Education hearing the Health Resources 
and Services Administrator, Dr. Claude Earl Fox, stated that the 
problem requires immediate attention by the Congress in order to ensure 
the future viability of health centers. Dr. Fox stated that grant 
dollars need to be increased or Medicaid dollars going to health 
centers need to be increased to address the situation. He also stated 
that in his professional judgment, health centers need a $200 million 
increase in fiscal year 1999 to maintain operations and meet the 
growing demands for services. In addition, Dr. Marilyn Gaston, Director 
of the Bureau of Primary Care, stated that five percent of health 
centers are bankrupt and between five and 10 percent more will be soon 
as a result of the financial squeeze affecting health centers.
    The National Association of Community Health Centers believes 
additional federal investment is needed to ensure the availability of 
primary and preventive health care in medically underserved 
communities, and priority should be given to strengthening and 
preserving the existing health center infrastructure. Health centers 
have been faced with the challenge of caring for an ever- increasing 
number of people seeking care in an era of stable or declining 
resources and shortages of primary care health professionals. As the 
number of uninsured persons increases, there must be a system in place 
that will provide essential health care services, especially for the 
most vulnerable, underserved people in our communities and in our 
nation. The health center system is already in place; it is cost-
effective, efficient, accountable, and it works. We urge you to 
maintain and build on it.
    As you consider the fiscal year 1999 appropriations, we request 
that you consider for the Consolidated Health Center Program (i.e., 
community, migrant, homeless and public housing): $926 million.
    Mr. Chairman, we know that you and members of the Subcommittee have 
a very difficult task ahead of you this year because of the strict 
limits on available funds. We have labeled our recommended funding 
levels as an investment in a proven system of care to foster wellness 
and prevention. If funded adequately, the continued presence of health 
centers and the availability of basic health services will contribute 
to a healthier, more productive America.
    Health centers were founded with a vision of community and consumer 
empowerment, and their experience over that past 30 years provides an 
object lesson on how consumer involvement can succeed where other 
models fail. Invest in health centers, build upon what has worked, look 
at the long history and success of the program and continue to invest 
in programs that mobilize communities to solve problems at the local 
level.
    Once again, Mr. Chairman and Members of the Subcommittee, I thank 
you for the opportunity to present you with my testimony.
                                 ______
                                 
 Prepared Statement of Dr. Rodney Mead, Professor of Zoology, Director 
                of NIH IDeA Program, University of Idaho
    Mr. Chairman and members of the Subcommittee, thank you for the 
opportunity to submit this testimony regarding the National Institutes 
of Health's Institutional Development Award (IDeA) program on behalf of 
the Coalition of EPSCoR States.\1\ I am Rodney Mead, and I am Professor 
of Zoology and Director of the NIH IDeA Program at the University of 
Idaho.
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    \1\ Alabama, Arkansas, Idaho, Kansas, Kentucky, Louisiana, Maine, 
Mississippi, Montana, Nebraska, Nevada, North Dakota, Oklahoma, Puerto 
Rico, South Carolina, South Dakota, Vermont, West Virginia, and 
Wyoming.
---------------------------------------------------------------------------
    Let me begin by expressing my thanks to Senator Larry Craig for his 
strong support of the IDeA program. IDeA works to improve Idaho's 
biomedical research capability, and we are deeply grateful for Senator 
Craig's efforts to ensure that the NIH has a truly effective IDeA 
program for the benefit of Idaho and of our nation.
    The 1993 NIH Revitalization Act (Public Law 103-43) authorized the 
NIH to establish a program to broaden the geographic distribution of 
health research funding. The IDeA program is similar to the 
Experimental Program to Stimulate Competitive Research (EPSCoR), a 
program established by the National Science Foundation to improve our 
nation's science and technology capability.
    The IDeA program funds merit-based, peer reviewed research and 
works to enhance the competitiveness of research institutions located 
in states with historically low aggregate success rates for grant 
applications to the NIH. For fiscal year 1998, the NIH has identified 
the following states as eligible for IDeA funding: Alaska, Arkansas, 
Delaware, Hawaii, Idaho, Kansas, Kentucky, Louisiana, Maine, 
Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, 
North Dakota, Oklahoma, Rhode Island, South Dakota, South Carolina, 
Vermont, West Virginia Wyoming and the Commonwealth of Puerto Rico.
    The fiscal year 1999 budget request for IDeA is $5.2 million. The 
Coalition of EPSCoR States respectfully requests that the Subcommittee 
appropriate $15 million for IDeA in fiscal year 1999.
    Let me begin by telling you how IDeA is improving Idaho's 
biomedical research capability. Idaho has received two IDeA awards 
totaling $500,000, all of which has been matched dollar for dollar by 
the state of Idaho. The federal funding has been equally divided 
between the University of Idaho (UI) and Idaho State University (ISU), 
and has been used to upgrade the biomedical research infrastructure at 
both institutions.
    Funds from the first award were used by both universities to 
create, equip and staff core molecular biology research laboratories. 
These core laboratories are designed to provide technical support, 
training and access to multi-user equipment that was not previously 
available. These services are made available to all biomedical 
researchers on both campuses. At UI, the core molecular biology 
laboratory is staffed by a full time Ph.D., whose position is now 
permanently funded by state funds.
    The second award has been used to purchase a state-of-the-art 
equipment for three core laboratories (molecular biology laboratory, 
confocal microscope laboratory, and the experimental laboratory animal 
facility). The phosphoimaging/gel documentation instrument purchased 
last year has received extensive utilization by biomedical researchers 
from five different departments on the University of Idaho campus. In 
addition, the first of several sets of specialized caging systems, 
which permit the housing of rodents in a germ-free environment were 
purchased. This year we are purchasing a sophisticated UV microscope 
for the confocal microscope laboratory that will greatly expand the 
capabilities of several of our biomedical researchers. The instruments 
in this core research laboratory are extensively used by members of the 
WAMI medical faculty. For example, Dr. Michael Laskowski makes 
extensive use of the confocal microscope in his studies of the growth 
and regeneration of mammalian nerves.
    These core research facilities are currently being used by 
biomedical researchers in the Departments of Biological Sciences, 
Animal Science, Food Science and Toxicology, Microbiology, Molecular 
Biology and Biochemistry, and by the Washington, Alaska, Montana, Idaho 
(WAMI) medical faculty at the University of Idaho. The core molecular 
biology laboratory at ISU is principally being used by biomedical 
researchers in the Department of Biological Sciences and the College of 
Pharmacy.
    The creation and enhancement of these research facilities have led 
to at least six important results. They have:
  --(1) provided access and training in the proper use of very 
        expensive multi-user equipment that was not previously 
        available. Use of this equipment has significantly reduced the 
        amount of time required to acquire, analyze, graphically 
        display data, and obtain publication quality images. This 
        equipment has both enhanced the quality of the data that were 
        are able to obtain and has increased the productivity of 
        Idaho's biomedical researchers. This has increased the 
        productivity of Idaho's biomedical research community, 
        including Dr. Holly Wichman, who has made extensive use of the 
        imaging system to acquire rapidly preliminary data that she 
        included in an NIH research grant application regarding the 
        evolution of viruses. This grant has just been funded by the 
        NIH;
  --(2) expanded the research capabilities of faculty and students by 
        providing training in new and rapidly changing molecular 
        biology technologies used in biomedical research. This has 
        allowed faculty, students, and post-doctoral trainees to 
        undertake research projects that were previously impossible due 
        to inexperience with the new techniques required to investigate 
        complex biomedical problems;
  --(3) reduced the time required to establish these new techniques in 
        investigators' laboratories and provided unlimited access to 
        methodological trouble-shooting expertise that was formerly not 
        available without impinging upon other researchers' time and 
        good will;
  --(4) enhanced the chances of Idaho's biomedical researchers of 
        obtaining NIH research grants by providing them with increased 
        technical capabilities and the opportunity to demonstrate their 
        ability to use these new techniques by collecting preliminary 
        data which are so vital in convincing grant reviewers that they 
        have the facilities, technical expertise and actual ability to 
        do what is proposed. For example, I obtained preliminary data 
        which ultimately convinced an NIH panel to approve funding of a 
        grant to investigate factors necessary for promoting changes in 
        the uterine environment that may be essential for successful 
        implantation of mammalian embryos;
  --(5) enhanced the ability of UI and ISU faculty to provide state of 
        the art training to future biomedical researchers. Several of 
        our graduate students have obtained training and used equipment 
        in the molecular biology laboratory to conduct and complete 
        their thesis research. Results of these studies have been 
        presented at recent national scientific meetings and 
        manuscripts have been or are being prepared for submission for 
        publication in leading scientific journals. Specific examples 
        include:
    --Ms. Carrie Bickle has completed a study regarding changes in the 
            length of the ends of chromosomes (telomeres) during aging 
            in mice;
    --Mr. Doug Hirzel completed a study of changes in uterine 
            concentrations of leukemia inhibitory factor during the 
            peri implantation period of pregnancy; and
    --Mr. Todd Garwood has reported on the isolation and changes of DNA 
            binding proteins.
  --(6) resulted in Idaho universities being better able to compete for 
        the brightest young biomedical researchers. For example, UI has 
        hired a faculty member (Dr. Debora Stenkamp) who studies the 
        developmental and molecular biology of color vision. Access to 
        equipment and technical help was an important factor in her 
        decision to accept this position at UI. Dr. Stenkamp was just 
        awarded her first NIH research grant.
    These accomplishments indicate that the intent of Congress and the 
goals of the IDeA program are being met, and that Idaho's biomedical 
researchers are becoming better equipped and better able to compete for 
research funding. The capability of Idaho's universities to provide 
state of the art training to our country's biomedical researchers has 
been and is continuing to be enhanced by this effective program.
    In previous years the National Center for Research Resources 
(NCRR), which funds the IDeA program, issued program announcements 
soliciting applications from IDeA eligible states to provide support 
for research activities that stimulate improvement in the biomedical 
research capacities of the institutions. In response to Congressional 
language included in the fiscal year 1998 Appropriation Committees 
Reports, NCRR has modified IDeA. The program will now support: (1) high 
quality applications for Shared Instrumentation Grants, using 
meritorious requests that have already been submitted to the SIG 
program; and, (2) using the Shannon Awards as a model, NIH will fund 
investigator-initiated proposals from IDeA eligible states with scores 
that fall near but below the funding cut-off in the regular Institutes 
programs. For fiscal year 1998 funds, no specific solicitation to the 
IDeA eligible states will be issued for either of these awards.
    Congress appropriated $13.6 billion for the NIH in fiscal year 
1998; for the NCRR Congress appropriated over $453 million. The 
Coalition of EPSCoR States applauds the Congress for this commitment to 
biomedical research and encourages Congress to continue funding 
biomedical research at as high a level as possible. We also ask 
Congress, and especially this Subcommittee, to consider the importance 
of making sure all parts of the country are able to contribute to the 
important research mission of the NIH. We encourage the Subcommittee to 
provide $15 million for NIH IDeA in fiscal year 1999.
    I thank the subcommittee for the opportunity to submit this 
testimony.
                                 ______
                                 
Prepared Statement of G. Brockwel Heylin, Director, Government Affairs, 
            the American Association of Colleges of Nursing
    This statement presents the fiscal year 1999 appropriations 
recommendations of the American Association of Colleges of Nursing 
(AACN) for nursing research and education. AACN represents over 520 
baccalaureate and graduate nursing education programs in senior 
colleges and universities across the United States.
    AACN thanks the members of this subcommittee for the fiscal year 
1998 funding levels for the National Institute of Nursing Research 
(NINR) at NIH. AACN also is grateful for the subcommittee's commitment 
to the Nurse Education Act (NEA) (Public Health Service Act Title 
VIII), Scholarships for Disadvantaged Students (in PHSA Title VII), the 
Agency for Health Care Policy and Research (AHCPR) and others. These 
needed funds are being well spent to improve the public health.
    Overall Recommendations: For NINR, AACN recommends an increase of 
$63.5 million over fiscal year 1998 to $127 million. For AHCPR, AACN 
asks for an increase of 10 percent to $161.08 million. For fiscal year 
1999 for the NEA, AACN respectfully requests an increase of 8 percent 
over fiscal year 1998 to a level of $70.9 million. For SDS, we seek an 
increase also of 8 percent over the fiscal year 1998 level to $20.2 
million. AACN endorses the fiscal year 1999 overall NIH recommendation 
of the Ad Hoc Group for Medical Research Funding. AACN agrees with the 
recommendation of the Health Professions and Nursing Education 
Coalition for fiscal year 1999 of $306 million for PHSA Titles VII and 
VIII. AACN also advocates appropriate fiscal year 1999 funding levels 
for Higher Education Act programs that serve nursing students at the 
undergraduate and graduate levels, such as Pell Grants, Perkins Loans, 
Federal Work-Study, TRIO, and GAANN.
National Institute of Nursing Research
    AACN urges the subcommittee to increase the fiscal year 1999 
funding for NINR to $127 million. This doubling of resources is 
essential for several reasons.
    One, NINR is ``fighting success'' in terms of its research and 
research training programs. The research being conducted and 
disseminated is extremely relevant and is making a difference to public 
health issues such as health promotion, caring for the increasing 
numbers of chronically ill individuals and their families, dealing with 
the acute care nature and high technology of our hospitals, and 
understanding how health care systems influence client/patient outcomes 
in terms of quality and cost. There is more and more demand for such 
research.
    Two, nursing science has advanced rapidly with numerous 
sophisticated clinical intervention studies underway, which are 
resource intensive and require years of study. Such intervention 
studies are at the heart of the science for nursing practice since we 
can understand best which interventions are most effective. These 
studies are quite expensive compared to laboratory research because of 
the involvement of human subjects and other factors.
    Three, the research training needs for nursing are quite high, 
unlike other biomedical sciences, according to the 1994 Institute of 
Medicine Biomedical Personnel Needs Report. A number of graduate 
programs are not fully staffed with doctorally prepared faculty. In 
addition, there is a graying of nurse researchers and a strong need to 
prepare and bring to maturity a sizable cadre of nurse scientists in 
the future.
    NINR has the smallest funding level of any NIH institute and all 
but one of NIH's 3 centers, despite the fact that nurses are the 
central human component in the delivery of care and management of 
health care for most patients in hospitals and communities. In fiscal 
year 1998, NINR received an increase of only 6.8 percent although the 
NIH at large was increased by 7.1 percent. NINR's funding base is less 
than one-third the level of the next higher funded NIH institute. A 
small percentage increase on such a low base equals a very small dollar 
increase for the science of nursing practice. Nursing is relevant to 
virtually every condition and disease within the health care delivery 
system.
Nursing research makes a difference, as the following examples 
        demonstrate
    Arthritis: About 11 percent of the U.S. Hispanic population suffers 
from arthritis. An NINR funded project at the Stanford Arthritis Center 
in California brings the benefit of previously English language only 
measurement scales to the Latino community. The project includes pain 
management and exercise for Spanish speakers through community 
outreach, classroom education, a manual, and audiovisual aids. The 
project concept is being expanded for use with Chinese patients.
    Early Hospital Discharge: Today's shorter hospital stays may save 
money but they mean that patients are sicker at discharge and need more 
support at home. NINR funded a project for comprehensive discharge 
planning and follow-up programs using visits and telephone contact by 
advanced practice nurses. The study improved patient outcomes and 
decreased the cost of care and the likelihood of readmissions. 
Originally developed with a focus on high-risk mothers and low birth 
weight infants, the model is being expanded to elderly patients with 
complex medical conditions and to prenatal care.
    Pain: The permutations and intensities of pain trouble patients and 
challenge caregivers. NINR funded research has discovered that, for 
women, a particular type of pain medication, kappa-opioids, more 
effectively reduce high levels of pain than morphine type drugs and 
with fewer negative side effects. The study also found that with the 
test drugs, pain relief lasted longer than with traditional 
medications. Now, the study seeks to ascertain dose response levels and 
whether hormones play a role in pain responses.
    Other Examples: NINR's research agenda focuses on helping patients 
deal with pain, maximizing the quality of life of people living with 
chronic conditions or the physical disabilities of stroke, avoiding low 
birth weight babies, and maternal and child health. Indeed 
interdisciplinary research partially funded by NINR increases the value 
of NIH research and is complementary to biomedical research. For 
instance, several Pennsylvania studies are studying critical illness in 
the elderly and elderly frail rural populations. A Texas grant seeks to 
reduce the number of teen pregnancies. University of Illinois-Chicago 
NINR project is examining ways to strengthen respiratory muscles in 
patients with chronic obstructive pulmonary disease. A University of 
Arkansas NINR grant has produced ways to improve knowledge on the 
ability of nursing home residents to achieve their activities of daily 
living thus reducing their need for assistance. A Florida Atlantic 
University project seeks to find ways to improve the quality of life 
and to reduce the care costs for Alzheimer's disease patients by using 
exercise and special monitoring. A Johns Hopkins University (MD) NINR 
project has investigated several interventions to reduce the risk of 
high blood pressure in young black men, a common concern in this 
population. A University of Mississippi Medical Center project funded 
by NINR is supporting an interdisciplinary research team to examine 
treatment of blood clots and tumors. NINR grants to schools in New York 
are examining childhood asthma and the side effects of chemotherapy. 
And a University of Wisconsin project is examining high risk pregnancy.
    The Core Centers program sponsored by NINR funds extramural 
research at several institutions to focus on major areas of 
professional nursing practice. They include symptom management 
(University of California San Francisco), care of the chronically ill 
(University of Pittsburgh [PA] and University of North Carolina, Chapel 
Hill), serious illness (University of Pennsylvania), gerontological 
nursing interventions (University of Iowa), and women's health 
(University of Washington). These Core Centers gather established 
investigators into an interdisciplinary team to benefit from the 
synergy of collaboration that will exceed what individually funded 
investigators might be expected to produce. The Core Centers were also 
designed to build and strengthen the research infrastructure of 
personnel and physical facilities and to promote outreach activities to 
disseminate findings and implications. While the Centers are relatively 
new, they have provided valuable knowledge on patient care issues.
End-of-life care
    Recently, NINR was assigned to serve as the lead institute on 
research related to palliative care, involving complex care, pain 
management, and psychosocial issues for terminal patients and the 
families of critically ill patients. With a population that is aging 
dramatically, these are major areas of concern to the health care 
system. NINR's base of knowledge in pain management and palliative 
care, positions it well to handle this important responsibility. Last 
fall, NINR and other NIH entities convened an interdisciplinary and 
inter-intramural conference on Symptoms in Terminal Illness. It has 
joined with other NIH entities to stimulate research interest in the 
subject. Research is critical to addressing these issues; by providing 
NINR with the financial tools it needs they will be addressed.
    In fiscal year 1997, NINR awarded 64 competing and 95 non-competing 
(renewal) grants; in fiscal year 1998, NINR expects to award 50 
competing and 121 non-competing grants, reflecting the shift to longer 
term and continuing research awards typical of a mature institute 
supporting a cadre of mature and productive research. But NINR's 
success rate, 20 percent, that is the proportion of peer reviewed, 
approved awards that actually receive funding, is below the NIH 
average, 28 percent. One reason is that NINR funds proportionately more 
clinical research than most NIH institutes, and research that involves 
actual human subjects is more expensive. But this alone cannot explain 
NINR's lower success rate. The problem is primarily its small funding 
base.
    The contributions that NINR funded research are making are 
substantial, but they could be even greater with an adequate financial 
base. AACN requests the Subcommittee to boost NINR funding of NINR to 
$127 million. Such a figure is still far less than the fiscal year 1998 
figure of $200 million for the National Institute of Deafness and 
Communications Disorders which was established almost at the same point 
in time. (AACN is not criticizing the higher funding of other 
institutes; it offers this point only for comparison.) A greater 
funding base for NINR is critical to supporting a critical mass of 
researchers and research activity that is producing breakthroughs of 
major importance to society in patient care, outcomes and cost 
effectiveness appropriate to nursing, the largest health care 
profession. With past strong congressional support for women in 
science, this is an excellent opportunity to increase research relevant 
to the public health of women and all Americans. With over ten years at 
NIH, NINR has the administrative structure, strategic plan and 
experience to be able to wisely and efficiently administer more 
spending authority.
Agency for Health Care Policy and Research
    AACN recommends a 10 percent increase over fiscal year 1998 for 
AHCPR to $161.08 million in fiscal year 1999. AHCPR's mission is 
critical to wise utilization of health care dollars because it seeks to 
discover and to publicize the most effective health care interventions.
The Nurse Education Act
    The NEA is the key source of federal financial support for nursing 
education programs and nursing students. Nursing students educated with 
NEA support often become the nurse scientists that conduct research for 
NINR and other NIH entities. The NEA provided stipends in 1997 to 
almost 37 percent of 12,769 full-time graduate nursing students in 267 
grants totaling $15.6 million. For example, Professional Nurse 
Traineeships (Section 830), provided assistance for masters and 
doctoral students in Pennsylvania ($910,424), Wisconsin ($339,935), 
North Carolina ($370,773), Washington ($418,555), Mississippi 
($180,226), Hawaii ($61,875), Iowa ($80,880) New Hampshire ($69,164), 
Texas ($917,281) and South Carolina ($185,465). The NEA funds programs 
to educate APNs and future nursing faculty (NEA Sections 821, 822 and 
831) and seeks to help disadvantaged students attain nursing education 
(Section 827). NEA funds supported about half of the doctorally 
prepared nursing faculty teaching today. Future nurse researchers often 
receive one or more types of NEA support as they increase their 
academic skills.
Scholarships for disadvantaged students
    AACN recommends a funding level for fiscal year 1999 for SDS of 
$20.2 million, an 8 percent increase over fiscal year 1998. By statute, 
30 percent of SDS appropriations are reserved for nursing students. 
Schools with proportionately greater numbers of minority students are 
given additional funds. For fiscal year 1996 (most recent data), 4,101 
nursing students received about $5.6 million in SDS support, and 2,601 
or 63.4 percent were minorities. Federal funds can help to increase the 
diversity of the profession.
    (The NEA and SDS are the subject of reauthorization legislation 
moving through Congress [S. 1754, Frist/Kennedy]. This bill would 
increase program flexibility and provide one authorization figure for 
NEA programs, but would support continuation of present legislative 
foci as well.)
National Health Service Corps
    AACN suggests a 5-percent increase over fiscal year 1998 for the 
National Health Service Corps Scholarship and Loan Repayment programs 
(PHSA Title III) to $82.074 million. This program seeks to attract 
health professionals to areas with shortages of such providers. Many of 
those areas are rural, and have difficulty attracting and retaining 
caregivers.
                               conclusion
    In summary, AACN respectfully recommends the following 
appropriations for fiscal year 1999:
                                                                Millions
National Institute of Nursing Research............................  $127
Nurse Education Act...............................................  70.9
Scholarships for Disadvantaged Students...........................  20.2
Agency for Health Care Policy and Research........................161.08
National Health Service Corps Scholarship/Loan.................... 82.07
                                 ______
                                 
    Prepared Statement of Vicki Kalabokes, Chief Executive Officer, 
                  National Alopecia Areata Foundation
    Chairman Specter and members of the Senate Subcommittee on 
Appropriations for the Departments of Labor, Health and Human Services, 
and Education, I am Vicki Kalabokes, chief executive officer of the 
National Alopecia Areata Foundation (NAAF).
    First, I would like to take this opportunity to thank you for your 
leadership and support. We are making progress because of the hard work 
of many researchers, the leadership of many professionals, and, most 
importantly, the vision of this committee and it's chair. Our work 
isn't finished, but we are making progress.
    The National Alopecia Areata Foundation (NAAF) is the largest 
organization in the nation dedicated to finding a cure for alopecia 
areata. It also provides support for those with alopecia through a 
publication program and support groups. The support groups provide 
information and direction to thousands of people with alopecia areata. 
As a support group leader I am sometimes the first person, outside of 
the medical community, that a person turns for help and information. 
Frequently people call who are scared, misinformed, and afraid. The 
support group provides a forum to reach out to others, problem-solve 
and grow.
    The National Alopecia Areata Foundation is also a member of, and 
currently the headquarters for, the Coalition of Patient Advocates for 
Skin Disease Research. The Coalition, which operates as a voluntary 
organization and as such receives no public or private money, provides 
an umbrella to over 21 ``lay'' skin groups. These groups represent 
millions of people who suffer from a wide range of skin diseases. We 
work together for two reasons. First, to provide information to others 
about why research is needed. And secondly, so that we may push for a 
wide-ranging research agenda. Many of us believe that diseases such as 
alopecia, lupus and others are the result of a malfunctioning immune 
system. When the key is found to one of our diseases then it is likely 
that many of the other diseases represented in the coalition will be 
cured. By working together we will make a difference. Alopecia areata 
is a disease that strikes over four million Americans. It is the loss 
of hair. For some it is a quarter size patch that can be easily 
covered, for others it is the loss of every hair follicle on their 
body. Young children get alopecia areata most often. It strikes members 
of all ethic groups. The loss of hair has several types of impacts. 
Hair provides significant protection for the body. The loss of 
eyelashes means that even the simple act of opening and closing ones 
eyes to keep the dust out is a difficult process.
    However, alopecia is not simply a physical problem, it has 
surprisingly serious psychological demands. For many people, when they 
first discover their hair falling out they are devastated. They think 
that they are the only ones in the world with the disease. Frequently 
when they go to their doctors they discover that even their physicians 
have little idea of what is happening, why it is happening, or even if 
others suffer from it. For some treatment options stop there, while for 
others they begin the long process of finding someone who knows 
something about the condition.
    Unfortunately in our society the lack of information is not the 
only problem. Frequently people with alopecia believe that they are 
vulnerable to the stares and grimaces of those around them. People have 
lost their jobs. A noted news anchor lost his on-air job because he was 
suddenly perceived as being unappealing. This lack of being appealing 
(either real or perceived) causes many people to lose confidence in 
themselves and they begin to withdraw from society.
    Recently, one parent called concerning her daughter who has 
alopecia areata and she was asking for help to stop the harassment that 
the daughter was experiencing at school. Another parent called who has 
alopecia areata and had just discovered that her daughter is developing 
it too. As this parent talked more about her child, she expressed the 
fears of many parents who have alopecia areata; they don't want their 
children to suffer from the turmoil and fears that they had to endure. 
Both parents wanted to know what they should or even could do.
    Fortunately, there are people who can help, and in many of our 
support groups people learn how they can help themselves both 
cosmetically and psychologically. They learn that they are not alone 
and that they can do something about their sense of vulnerability and 
isolation. But the real solution will be when we find a cure for 
alopecia areata.
    Over the past ten years the Foundation has raised and provided 
almost $1.5 million for research studies. Our privately funded research 
studies have been studying the genetic structure of hair, the function 
of the immune system, and supporting non-human research studies looking 
for the cause of alopecia. Several weeks ago the press hailed a major 
discovery of a ``hairless gene.'' This gene was discovered by one of 
our Foundation's funded researchers. We can do much more if we fund 
research programs with the National Institutes of Health.
    Part of our research program is to continue to work with the 
National Institute of Arthritis, Musculoskeletal and Skin Disorders to 
create a research agenda. In 1990 and in 1994 NIAMS and NAAF conducted 
two international research workshops on what is known about alopecia 
areata. One of the many results from this joint program was that NIAMS 
funded a significant study on the structure of the disease. Another 
result was the discovery of animals with alopecia--thus NAAF was able 
to support the first non-human host of the disease.
    On November 5, 1998, we will be holding the Third International 
Workshop on Alopecia Areata, with NIAMS. This workshop, as with the 
earlier meetings will bring researchers, clinicians, and patients 
together from around the world to study what progress has been made and 
how new studies should be structured. The convening authority of NIAMS 
is critical for this sharing of knowledge. However, its long-term value 
will be seen because of the unique relationship that has been developed 
with NIAMS and NAAF.
    Working together in this unique private-public partnership is a 
significant step towards finding a cure. We hope to continue this 
relationship with NIAMS providing limited funds for critical studies, 
while we continue to work to support the research effort as well. With 
this partnership we have been able to sharpen the research agenda so 
that we are looking at questions that are building on a wider and more 
informed base of knowledge.
    The National Alopecia Areata Foundation and the 20 other lay skin 
disease groups in the Coalition of Patient Advocates for Skin Disease 
Research ask that you continue to support NIAMS. We are asking for an 
increase of 15 percent. This increase would allow the Institute to 
increase its ability to fund more research projects and support more 
programs that will help the over 60 million people who are impacted by 
skin diseases. We also support the proposal of the Ad Hoc Group for 
Medical Research Funding, which calls for a 15-percent increase in 
funding for the NIH in fiscal year 1999 as a first step toward doubling 
the NIH budget over five years. We recognize that difficulty in 
achieving this goal under the current spending limits, and encourage 
the Congress to explore all possible options to identify the additional 
resources needed to support this increase.
    We also believe that work done in any of the disease areas 
represented by the Coalition of Patient Advocates for Skin Disease 
Research, will have a profound impact on the lives of over 60 million 
Americans who suffer from one or more than one of the diseases that 
NIAMS is charged with investigating. We also believe that when a cure 
is found for any of these diseases that there is a good chance that it 
will help in finding a cure for many of the other skin diseases.
    Again thank you for your vision and concern. Without your support 
this unique private/public partnership would only be a dream, with your 
help it will result in a cure.
    I look forward to answering your questions.
                                 ______
                                 
Prepared Statement of Dr. Raymond E. Bye, Jr., Associate Vice President 
                 for Research, Florida State University
    Mr. Chairman, thank you, and the Members of the Subcommittee, for 
this opportunity to submit testimony. I would like to take a moment to 
acquaint you with Florida State University. Located in the state 
capital of Tallahassee, we have been a university since 1947; prior to 
that, we had a long and proud history as a seminary, a college, and a 
women's college. While widely known for our athletics teams, we have a 
rapidly emerging reputation as one of the Nation's top public 
universities. Having been designated as a Carnegie Research I 
University several years ago, Florida State University currently 
exceeds $100 million per year in research expenditures. With no 
agricultural or medical school, few institutions can boast of that kind 
of success. We are strong in both the sciences and the arts. We have 
high quality students; we rank in the top 25 among U.S. colleges and 
universities in attracting National Merit Scholars. Our scientists and 
engineers do excellent research, and they work closely with industry to 
commercialize those results. Florida State ranks seventh this year 
among all U.S. universities in royalties collected from its patents and 
licenses. In short, Florida State University is an exciting and rapidly 
changing institution.
    Mr. Chairman, let me describe four projects that we are pursuing 
this year. The first is a collaborative project between FSU and UM 
dealing with risk assessment activities related to several health 
issues. Several proposals have been completed and are being sent to the 
Directors of the National Institutes on Health (NIH), National 
Institute for Drug Abuse (NIDA), and the National Institute of Child 
Health and Human Development (NICHHD). The proposal to NIH seeks 
funding to provide an overarching capability to respond to requests 
from several institutes in the overall risk assessment area. This would 
be consistent with report language included in the fiscal year 1998 
Committee reports. These funds will establish a joint FSU-UM Risk 
Assessment and Intervention Center that will provide invaluable data to 
a wide range of health and health-related federal agencies that deal 
with health and other human outcomes. An amount of $750,000 is being 
requested to establish such a Center. No new legislative language will 
be sought in fiscal year 1999. Based on pending proposals at NIH, the 
collaborators are requesting support at the $2 million level from the 
Department of Health and Human Services (HHS). State matching funds 
will be sought from the Florida legislature.
    Florida State University (FSU) and the University of Miami (UM) are 
also collaborating to establish a joint Program in Aging and Health 
Promotion dedicated to research on the issues of health and health care 
facing an aging population. Florida is the ideal state for such a 
project given the high proportion of people over 65 in the population 
and the presence of these two research universities with outstanding 
programs in this area. The resources include UM's School of Medicine 
and FSU's Pepper Institute on Aging and Public Policy as well as FSU's 
Center for Population Studies. The Center will become a focal point for 
national, state, and local research on such issues as Medicare's 
transition to managed care; the provision of long-term care for the 
frail elderly including models to integrate acute and long-term care; 
and the impact of immigration on the racial and ethnic structure of the 
older population of the future. Partners will include the Florida 
Department of Elder Affairs and other state agencies. Private 
foundation support is also being sought. The initial step in securing 
federal funding will be project funding for a research development 
proposal to the National Institute on Aging (NIA). We will be seeking 
approximately $1 million in fiscal year 1999 from NIA, and matching 
state funding will be sought.
    A third collaborative project between FSU and UM will look at the 
effectiveness of early childhood programs in preparing children for 
school. There are several major early childhood services: Head Start, 
Pre-K, childcare, and early intervention programs. Although these 
programs vary substantially in terms of staff, cost and quality, little 
is known of the differences in their effectiveness as school readiness 
programs. We propose to answer these questions by comparing the school 
readiness of children enrolled in early childhood programs 
characterized as effective based on the literature, with that of 
children enrolled in sub-optimal programs. This research will also help 
to determine whether inclusive programs, currently advocated for 
children with disabilities, are equally effective for children with all 
types of disabilities. We are seeking $2 million in fiscal year 1999 
from HHS for this project.
    Another project that we are seeking funding for in fiscal year 1999 
is for course materials for training purposes that could be based upon 
materials developed by the British Open University (BOU). Florida State 
University and the British Open University signed an agreement to 
jointly develop educational materials with FSU faculty playing key 
roles as mentors/teachers for the users of these materials at various 
training sites. New technologies will be employed in this effort, and 
innovative approaches in utilizing these technologies in classrooms and 
other training settings will be emphasized. We are working closely with 
the Leon County School District (FL) in creating a model program 
effort. Our consortia will be seeking funding from the Department of 
Education and its Technology Innovation Challenge Grants program. We 
anticipate a $1 million effort in fiscal year 1999 and $5 million over 
five years.
    Mr. Chairman, these activities discussed will make important 
contributions to solving some key problem and concerns we face today. 
Your subcommittee's support for research activities across your 
jurisdiction is greatly appreciated. Those investments are crucial one 
for our Nation's future. Thank you again for this opportunity to 
present these views for your consideration.
                                 ______
                                 
 Prepared Statement of Ritchie L. Geisel, President, Recording for the 
                       Blind and Dyslexic [RFB&D]
    Mr. Chairman, Mr. Cochran, members of the subcommittee, I am 
Ritchie Geisel, President of Recording for the Blind and Dyslexic 
(RFB&D), whose headquarters are located in Princeton, New Jersey, with 
thirty-two recording studios throughout the United States. It is on 
behalf of RFB&D that I submit this statement in support of our request 
for continued federal support of our mission as the nation's primary 
producer of recorded textbooks for people of all ages who cannot use 
standard print because of a visual, perceptual or physical disability.
    First, I want to thank the members of the subcommittee for the 
continuous support that you have given RFB&D since our first federal 
assistance, which began in 1975. This support, plus the support we 
receive through private philanthropy, allowed us this year to circulate 
more than 245,000 textbooks, free of charge, to approximately 50,000 
borrowers. In 1990, the number of borrowers was less than half that 
number. Increased federal support has been key to our ability to reach 
an increasing number of students, including an increasing number of 
severely dyslexic students.
    Historically, RFB&D was founded in 1948 as a service for returning 
blind veterans of World War II, and has grown into a national, private, 
volunteer-based organization serving as the national education library 
for people who cannot read standard print because of a disability. 
Located in Princeton, New Jersey, its volunteer readers are spread 
throughout the United States, as are its library users.
    RFB&D distributes textbooks and other educational materials in 
accessible audio and digital sound and text formats. Our tape and 
digital library continues to grow with more than 75,000 titles and is 
constantly updated to meet the needs of our student and professional 
users. Our books are provided free of charge to students of all ages, 
after a small registration fee, with students permitted to borrow as 
many texts as required for their course of study.
    Our request to the subcommittee for fiscal year 1999, is for an 
appropriation of $6,500,000, an increase of $500,000 over the amount 
provided by the Congress last year. This federal subsidy, which is 
approximately 25 percent of our total budget, will be used for two 
significant initiatives:
  --1. Expanding the number of student borrowers through an aggressive 
        outreach program: By the year 2000, only three years from now, 
        the number of borrowers is expected to exceed 80,000 students 
        dependent on us for their textbooks. Since these students are 
        entitled by both the Americans with Disabilities Act (ADA) and 
        the Individuals with Disabilities Education Act (IDEA) to 
        appropriate educational materials, RFB&D believes that our 
        federal appropriation represents an appropriate contribution 
        towards this cost. Our highly trained readers are volunteers 
        knowledgeable in the field in which they read; therefore, RFB&D 
        is able to meet this need at a fraction of what it would cost 
        government, whether local or federal, if it were required to 
        produce these textbooks on their own.
  --2. Converting RFB&D's recording system from analog tape to digital 
        format: RFB&D is well along in this 3-year project to convert 
        its recording operations to the new digital technology. This 
        change will have two principal advantages. First, it will allow 
        visually impaired and dyslexic students to search and move 
        around within a book in the same way that sighted students do. 
        Second, it will permit books to be circulated on CD-ROM and 
        electronically through the Internet. During 1998, RFB&D has 
        further refined its core digital technology and begun the 
        process of revamping its 32 recording studios located 
        throughout the United States in order to begin recording 
        digitally.
    Mr. Chairman, RFB&D and its student users are grateful for the 
support the committee has provided in the past, and are hopeful that 
you will be able to approve our request for $6,500,000 for fiscal year 
1999. This level of support will assist RFB&D as it continues our joint 
efforts to serve the educational needs of disabled students throughout 
the United States.

                                  RECORDING FOR THE BLIND AND DYSLEXIC (RFB&D)
                               [Special education, technology, and media services]
----------------------------------------------------------------------------------------------------------------
                           Fiscal year                                 Base          Outreach          Total
----------------------------------------------------------------------------------------------------------------
1998 appropriation..............................................      $6,000,000  ..............      $6,000,000
1999 President..................................................       6,000,000  ..............       6,000,000
1999 RFB&D request..............................................       6,000,000        $500,000       6,500,000
----------------------------------------------------------------------------------------------------------------


                                      RECORDING FOR THE BLIND AND DYSLEXIC
----------------------------------------------------------------------------------------------------------------
                                                                                                       2000
                                                       1990            1995            1998         (estimate)
----------------------------------------------------------------------------------------------------------------
Students........................................          23,287          37,176          49,515          80,000
Books loaned....................................         143,020         214,621         245,274         400,000
----------------------------------------------------------------------------------------------------------------

    Recording for the Blind and Dyslexic (RFB&D), located in Princeton, 
New Jersey, is the nation's primary producer of recorded textbooks for 
people of all ages who cannot use standard print because of a visual, 
perceptual or other physical disability. Books from its master tape 
library are loaned, free of charge, to users throughout the United 
States. RFB&D is supported principally through private, charitable 
giving and volunteer labor, but has received support from the 
Department of Education continuously since 1975. In 1998, 245,274 books 
are expected to be sent to 49,515 users, and RFB&D has recently 
committed to a doubling of the number of blind and dyslexic student 
borrowers by the year 2000. (See table above.)
    In fiscal year 1998, RFB&D received increased funding from Congress 
to support two significant initiatives: (1) substantial expansion in 
the number of student borrowers served by the organization, and (2) 
development and application of digital technology as a tool to improve 
the usefulness of its recorded books for students. Congress approved 
these increased resources as part of its continuing partnership with 
RFB&D, and both projects are proceeding on schedule. RFB&D is well 
along in its 3-year project to convert its recording operations from an 
analog tape system to new digital technology. This change will have two 
principal advantages. First, it will allow visually impaired students 
to search and move around within a book in the same way that sighted 
students do. Second, it will eventually permit books to be circulated 
on CD-ROM and electronically through the Internet. During 1998, RFB&D 
has further refined its core digital technology and begun the process 
of revamping its 32 recording studios located throughout the United 
States in order to begin recording digitally. The process of expanding 
the number of students receiving books is proceeding, and an additional 
6,225 borrowers have been added this past year. RFB&D believes this 
process can be further accelerated through an expanded outreach program 
which has already been implemented and will be expanded in fiscal year 
1999.
    The $500,000 increase requested for RFB&D for fiscal year 1999, is 
compatible with the long range financial plan developed at the 
Appropriations Committee's request and submitted to Congress on January 
31, 1997. The amount requested represents approximately one-fourth of 
the organization's operating budget with the remaining funds generated 
from private sources.
                                 ______
                                 
      Prepared Statement of the National Rural Health Association
    The National Rural Health Association (NRHA) thanks Chairman 
Specter and members of the Committee for the opportunity to submit for 
the record the association's fiscal year 1999 funding requests for 
programs important to our nation's rural health care delivery system. 
We believe we can offer you and your Committee a unique and insightful 
look at the health care needs of rural frontier America.
    The NRHA is a national nonprofit membership organization that 
provides leadership on rural health issues. The NRHA works to create a 
clear national understanding of rural health care, its needs and 
effective ways to meet them. Our mission is to improve the health of 
rural Americans and to provide leadership on rural health issues 
through advocacy, communications, education and research. As you are 
well aware, rural areas are unique. They differ from urban areas in 
their geography, population mix and density, economics, lifestyle, 
values and social organization. Rural people and communities require 
programs that respond to their unique characteristics and needs.
    The NRHA membership is a diverse collection of individuals and 
organizations, all of whom share the common bond of an interest in 
rural health. Individual members come from all disciplines and include 
administrators, physicians, nurses, dentists, non-physician providers, 
health planners, researchers, educators and policy-makers. Organization 
and supporting members include hospitals, community and migrant health 
centers, state health departments and university programs.
    The NRHA appreciates this opportunity to discuss several programs 
we feel are particularly crucial to the quality of rural health care 
services. However, attached is a more detailed letter containing all 
the NRHA's specific program funding level requests for fiscal year 
1999, which was sent to Chairman Arlen Specter and Ranking Member Tom 
Harkin on March 11, 1998.
    Before discussing specific programs, the NRHA wants to express its 
strong opposition to any special projects being funded in this year's 
appropriations bill from funds appropriated for the Rural Health 
Outreach, Network Development and Telemedicine Grant program and the 
Rural Health Research Grant program. While the projects that were 
earmarked in last year's bill were both innovative and important, the 
NRHA believes that any program increases should be made available in 
their entirety to the competitive grant process, which was the original 
intent of Congress.
    The National Health Service Corps (NHSC) is one of the NRHA's 
partners in several of our initiatives to recruit and retain more 
health care providers in underserved rural communities. The NHSC is 
long overdue for a funding increase after having received only level 
funding the last several fiscal cycles, and the NRHA urges the 
Committee to increase the Corp's funding to $155 million. This funding 
increase is desperately needed so the NHSC can expand its outreach 
efforts in educating rural communities regarding the options the Corps 
can provide and targeting a portion of the existing pool of health 
professionals toward service in underserved communities. In 1996, the 
NHSC placed 1,371 health care professional in rural areas of which 771 
were primary care physicians. However, there are still many communities 
that cannot provide essential health care services on their own. Since 
its inception 25 years ago, the NHSC has been an essential lifeline for 
providing health professional services to those communities most in 
need.
    For example, Dr. Ralph Taube began his practice with the Tigerton 
clinic in Tigerton, WI, in 1979. His NHSC obligation was completed in 
June 1982, but he remained in the community for another nine years. For 
twelve years he provided medical care to the community and was joined 
by another physician who still provides care in Tigerton. Without the 
initial support of the NHSC, the small clinic might not have been able 
to recruit for and stabilize the practice that provided much needed 
support for the people of this community.
    The Cornerstone Care facility in Greensboro, PA, has been able to 
expand their services to two other communities, Rogersville, PA, and 
Burgettstown, PA, because of the commitment of the current medical 
director Nathan Duer. Dr. Duer was an NHSC scholar who remained in the 
community after serving his four year commitment to the NHSC. His 
continual presence has allowed the practice to stabilize and build to 
what is now a three site network with both medical and dental services.
    In Onawa, IA the NHSC has placed two physicians, Dr. Gerald Stanley 
and Dr. Curtis Mock, who have been working together for almost ten 
years establishing a system of health care services for the community. 
Dr. Stanley and Dr. Mock are in the process of expanding their system 
of care to another satellite with the two physician assistants and 
physician placed in Onawa by the NHSC in recent years. This team of 
health care providers in Onawa is also active at the state level 
ensuring that access to quality health care in rural America continues 
to improve. Dr. Mock is on the State Board of Directors for Rural 
Health Clinics and Dr. Stanley is on the State Board of Directors of 
the Iowa Academy of Family Practice and has been recently nominated for 
the NHSC Physician of the Year Award.
    The Balanced Budget Act of 1997 (BBA) provides numerous 
opportunities to improve access to quality health care services to 
rural and frontier Americans. It is imperative, however, that Congress 
provide the financial resources necessary to ensure the full and proper 
implementation of these provisions. One such program, which the NRHA 
strongly supports, is the Medicare Rural Hospital Flexibility program. 
This program was created by the BBA to improve access to essential 
health care services through the establishment of Critical Access 
Hospitals (CAHs) and rural health networks. The program creates an 
important alternative to small rural hospitals that provides regulatory 
relief and more equitable financing options by assisting states in 
proactively respond to market changes, remove any restrictive standards 
and authorities, support network development and regional approaches to 
health care and support hospitals that want to respond to ongoing 
market reforms. The NRHA strongly urges the Committee to provide the 
$25 million annual appropriation authorized by the BBA. This money 
would provide states with the necessary resources to develop and 
implement a rural health plan, develop networks, designate CAHs and 
improve rural Emergency Medical Services.
    The NRHA requests that the Committee provide $50 million for the 
Rural Health Outreach, Network Development and Telemedicine Grant 
program. This program, which was reauthorized in 1996, provides 
important grant opportunities to rural communities. The Rural Outreach 
Grant program includes grants for developing formal, integrated 
networks of providers that may offer a range of primary care and acute 
care services. Network development grants are designed to develop 
organizational capacity in the rural health sector through formal 
collaborative partnerships involving shared resources and possible 
risk-sharing.
    One outreach grant in Lock Haven, Pennsylvania, provides health 
promotion classes and health screening programs throughout rural 
Clinton County. Health screening services, conducted in local fire 
halls include checking for hypertension, diabetes, elevated cholesterol 
levels, skin cancer and other conditions. Clients are referred to 
appropriate sources of care as needed. The grant also supports health 
education classes on such topics as diet, exercise, nutrition and 
diabetes control.
    Marshalltown, Iowa, which is providing medical and dental services 
to underserved children, youth and families through a school-based 
outreach program, is another innovative outreach grant project. Using a 
mobile medical clinic, services are rotated among four elementary 
schools. Hundreds of elementary school children have received primary 
medical care and dental services through this project. The grant has 
also established an emergency prescription drug reimbursement program 
for low income students and their families.
    Additionally, the program will continue to offer grants to rural 
communities working to provide health care services through new and 
innovative strategies including mobile primary care outreach programs 
for migrant and seasonal farmworkers and telemedicine. Since 1991, 
approximately 300 rural communities have benefited from innovations in 
health care service delivery from grants totaling $170 million. The 
program also currently funds 18 telehealth/telemedicine projects.
    The NRHA strongly recommends a $15 million appropriation for Rural 
Health Research, which provides funding for research programs, the 
Rural Information Center Health Service (RICHS), telemedicine grants 
and the National Advisory Committee on Rural Health. This grant program 
currently supports six Rural Health Research Centers that provide 
policy relevant research, including work on rural hospitals, health 
professionals, delivery of mental health services and functioning of 
managed care systems.
    RICHS began in 1990 as a joint project of the Office of Rural 
Health Policy, HHS, the National Agricultural Library and the 
Department of Agriculture. It serves as a national clearinghouse for 
those seeking information referrals about rural health issues and 
answers requests on specific rural health issues. The knowledge gained 
from all these important research efforts is an important contributor 
to the success of all the above mentioned programs in improving access 
to quality rural and frontier health care services.
    In many cases, the only health care entity providing primary and 
preventive health care services to a rural community is a community 
health center (CHC). Overall, CHCs provide services to eight million 
residents of underserved areas. About 60 percent of health centers and 
50 percent of the users are from rural areas. CHCs have been proven to 
significantly improve a community's health especially when it provides 
maternal and child health care services as well as child immunizations. 
The NRHA urges the Committee to provide $926 million for the 
Consolidated Health Centers program for fiscal year 1999 to continue 
improving the health status of our country's underserved populations.
    We also urge you to include specific language in your Committee's 
final report directing $5 million from the National Health Service 
Corp's allocation for State Offices of Rural Health. The State Offices 
of Rural Health coordinate statewide rural health activities, offer 
technical assistance to communities to develop health care programs and 
are also actively involved in efforts to recruit and retain health care 
providers in rural areas.
    The NRHA wishes to thank the Chairman and Members of the Committee 
again for the opportunity to submit for the record the NRHA's fiscal 
year 1999 funding requests. It is important that the work already done 
continue to be built upon to create a healthier life for rural and 
frontier Americans. However, due to the geographical, distance and 
financial restraints that many rural and frontier areas face, this 
progress depends upon the assistance of all levels of government. The 
NRHA stands ready to work with your Committee and the Congress to 
ensure access and quality of essential health care services continue to 
improve for our country's rural residents.
                                 ______
                                 
   Prepared Statement of Dr. William H. Mahood, President, Digestive 
                       Disease National Coalition
    Mr. Chairman and members of the Subcommittee, thank you for the 
opportunity to submit written testimony regarding the federal 
government's support for digestive disease research and prevention 
programs at the National Institute of Diabetes and Digestive and Kidney 
Diseases (NIDDK) and the Centers for Disease Control and Prevention 
(CDC).
    I am Dr. William Mahood, a practicing gastroenterologist in 
Abington, PA and the president of the Digestive Disease National 
Coalition (DDNC). Founded in 1978, the DDNC is a voluntary organization 
comprised of 22 professional and patient organizations concerned with 
the many diseases of the digestive tract. The Coalition has as its goal 
a desire to improve the health of millions of Americans who suffer from 
both acute and chronic digestive disorders
    Mr. Chairman, the social and economic impact of digestive diseases 
is enormous. Digestive disorders afflict approximately 62 million 
Americans, resulting in 50 million visits to physicians, 10 million 
hospitalizations, 230 million days of restricted activity, and nearly 
200,000 deaths annually. The total cost associated with digestive 
diseases has been conservatively estimated at $56 billion a year.
    With these devastating numbers in mind, I would like to take this 
opportunity to thank you Mr. Chairman for your past support of the 
National Institutes of Health and the Centers for Disease Control and 
Prevention. Regarding the coming fiscal year, I would like to briefly 
discuss the following: (1) digestive disease research at NIDDK (2) 
colorectal cancer prevention activities at CDC, (3) viral hepatitis 
research and prevention, and (4) irritable bowel syndrome.
                  digestive disease research at niddk
    Millions of Americans suffering from digestive disorders are 
pinning their hopes for a better life--or even life itself--on medical 
advances made through research supported by the National Institute of 
Diabetes and Digestive and Kidney Diseases. Recent breakthroughs in our 
understanding of hemochromatosis, Crohn's disease, pancreatitis and 
other digestive abnormalities reinforce the need for continued support 
of NIDDK.
    For fiscal year 1999, the DDNC recommends that NIDDK receive a 15 
percent increase over last year. This percentage translates into $131 
million over fiscal year 1998 and would bring NIDDK's total 
appropriation to $1 billion. At this point Mr. Chairman, I would like 
to make clear that although the DDNC strongly supports the concept of 
doubling NIH's overall budget in the next five years, we do not believe 
that these increases should come at the expense of other important 
Public Health Service programs.
                      colorectal cancer prevention
    Turning from biomedical research at NIH to disease prevention and 
control at CDC, I would like to say a few words about CDC's newly 
established program promoting colorectal cancer screening.
    Colorectal cancer is the third most commonly diagnosed cancer for 
both men and women in the United States and the second leading cause of 
cancer- related deaths. Although colorectal cancer is almost entirely 
curable when detected early, recent studies have shown a tremendous 
need to (1) inform the public about the availability and advisability 
of screening and (2) educate health care providers with respect to 
colorectal cancer screening guidelines. The recently initiated National 
Colorectal Cancer Screening Awareness Program at the Centers for 
Disease Control and Prevention will address these needs by coordinating 
with national partners like the DDNC to develop an information program 
emphasizing the value of early detection. The digestive disease 
community hopes that this new program will do for colorectal cancer 
screening rates what CDC's Breast and Cervical Cancer Screening Program 
has done for mammography and Pap smear screening compliance.
    Mr. Chairman, as the DDNC representative to CDC's colorectal 
screening program, I have seen first hand the ambitious plan that CDC 
has to reduce the incidence of this devastating disease. As a result, 
the DDNC encourages the Subcommittee to provide CDC with $5 million (an 
increase of $2.5 million over fiscal year 1998) for this vital 
campaign.
                viral hepatitis research and prevention
    Mr. Chairman, viral hepatitis is one of this country's most 
dangerous and prevalent infectious diseases. More than 5 million 
Americans are currently infected with chronic hepatitis B or hepatitis 
C. Overall 128,000 new cases are reported each year. Because chronic 
viral hepatitis can result in severe liver impairment, liver 
transplantation (at a cost of approximately $250,000 per patient) often 
becomes the only treatment option available for many individuals. 
Already, chronic hepatitis C accounts for nearly one third of all liver 
transplants being performed in the U.S. It is estimated that there are 
up to 10,000 deaths annually from hepatitis C and the CDC projects that 
this number may triple by the year 2010.
    The DDNC is pleased that NIDDK convened a Hepatitis C Consensus 
Development Conference last March. We believe that priority should be 
given to supporting the research recommendations developed by the 
consensus panel, particularly the development of vaccines for hepatitis 
C. Also, we urge making existing hepatitis B vaccines readily available 
to at-risk populations through an expansion of CDC's vaccination 
program.
                        irritable bowel syndrome
    Finally, Mr. Chairman, I would like to provide the Subcommittee 
with some information on one of the most common and perplexing 
digestive disorders, irritable bowel syndrome (IBS). IBS is a chronic 
complex of disorders that malign the digestive system affecting 10-15 
percent of the general population annually. These disorders strike 
people from all walks of life and result in a significant toll of human 
suffering and disability. Although IBS is one of the most common GI 
disorders people are often very isolated by their condition.
    In a recent U.S. Householder Survey of Functional Gastrointestinal 
Disorders, Prevalence, Sociodemography and Health Impact, irritable 
bowel syndrome accounted for 10 percent of the total gastrointestinal 
disorders population, 46 percent of which required the supervision of a 
gastroenterologist. This care alone results in millions of dollars in 
health care costs every year. In addition, individuals who suffer from 
IBS will miss 13.4 days of work annually as opposed to the 4.9 national 
average, further contributing to higher health care costs and loss of 
productivity. IBS alone has recently been called a multi-billion dollar 
problem by the gastrointestinal community. I would like to thank 
Senator Kohl for his past interest in this area and remind the 
Subcommittee that much more can be done and should be done through the 
NIDDK to address the needs of the millions of Americans suffering from 
IBS.
    Mr. Chairman, once again, thank you very much for the opportunity 
to present the views of the Digestive Disease National Coalition.
                                 ______
                                 
 Prepared Statement of the National Association of Addiction Treatment 
                               Providers
    The National Association of Addiction Treatment Providers, Inc. is 
very honored and proud to participate in this hearing on ``Addiction 
and Recovery''. For the past twenty years, NAATP has been the 
preeminent association representing the interests and concerns of 
private sector addiction treatment providers across this country. This 
organization represents some of the highest quality and most well 
recognized treatment programs, as evidenced by the attached Board of 
Directors list, throughout the United States.
    Perhaps no other subject generates as much discussion, debate, 
disagreement, hostility and confusion as does the topic of addiction. 
Hardly any citizen of this country would argue that addiction, in some 
form, has not touched their family or a family close to them. However, 
the responses to this primarily public health issue have been confusing 
and often misguided. Our public policy initiatives have oscillated 
between an attempt to ignore the disease to punishment for those with 
the disease of addiction. In our attempt to simplify a complex issue, 
we have often not taken the time to understand this disease for what it 
is a chronic re-occurring disease that does respond to treatment.
    The National Association of Addiction Treatment Providers 
recognizes that the current public debate on addictions has focused on 
a significant number of issues including, demand reduction, illegal vs. 
legal, criminal justice component, outcome expectations, health care 
off-set dollars, etc. Without diminishing the importance of these 
issues, NAATP wishes to comment on the treatment side of the equation. 
The National Association of Addiction Treatment Providers begins with 
the premise that Alcoholism and other Drug Dependencies is diagnosable, 
the disease responds to treatment and that through appropriate quality 
treatment and a life-long monitoring process, this disease like any 
other chronic disease can be managed. Therefore, recovery becomes 
possible!
    The one hundred and forty members of the National Association of 
Addiction Treatment Providers, Inc. believe that their contribution to 
the continued national debate on this issue will be best served with a 
focus on treatment. In this regard, NAATP is committed to helping to 
promote and provide the most current, accurate and reliable information 
possible on addiction treatment.
    NAATP believes that the single strongest deterrent to an informed 
discussion of this issue are the stigmas and myths associated with the 
diagnosis and treatment of alcoholism and other drug dependencies. The 
overt and covert discrimination is rampant! The National Association of 
Addiction Treatment Providers supports the passage of Federal 
Legislation that would eliminate discrimination that currently exists 
in private health insurance plans. The artificial establishment of 
lifetime dollar caps and yearly limited treatment episodes for 
addiction treatment which are not included or in place for other 
diseases is blatant discrimination. In 1997 Senator Paul Wellstone (S. 
1147) and Representative James Ramstad (H.R. 2409) introduced 
legislation that would end this discrimination. In a recent study 
completed by Milliman & Robertson Premium Estimates for Substance Abuse 
Parity Provision for Commercial health Insurance Products (September 2, 
1997) it was found that the cost for this ``act of justice'' would be 
0.5 percent or less than $1 per member per month. NAATP supports the 
rapid and complete passage of this legislation so as to take the first 
steps toward dealing with the stigma and discrimination that have 
plagued this disease.
    If we are indeed going to commit ourselves to providing treatment 
to those individuals and families whose lives have been ravaged by 
chemical dependency then we must take note of and address the following 
issues:
    Treatment efficacy.--The efficacy of treatment for alcohol and 
other drug problems is clearly established. Outcome studies for the 
treatment of addictions have clearly documented that treatment is 
effective and beneficial both to the individual, her or his family, and 
society. Recent studies have shown that addictions do conform to the 
common expectations of chronic illness and that addiction treatment has 
outcomes comparable to other chronic conditions. A key issue with 
chronic conditions is compliance with the prescribed treatment plan. 
The likelihood of requiring additional treatment within a 12-month 
period following initial treatment is generally higher for diabetes, 
hypertension and asthma than for alcoholism and other drug 
dependencies.
    Economics of treatment.--Accessibility to addictions treatment is a 
major issue. At present, demand for addiction treatment services is 
considerable. Current reimbursement for care both in public and private 
sector combined, are not sufficient to meet the demand for treatment 
appropriately. Hence, accessibility to treatment is often non-existent 
or truncated. It has been the experience of the National Association of 
Addiction Treatment Providers and its members (both former and present) 
that over the past ten years nearly 50 percent of the addiction 
treatment beds have disappeared. This reduction in beds has been 
directly related to the availability and accessibility of treatment 
funds to pay for such treatment. Therefore, due considerations must be 
given to ensure that appropriate fiscal resources necessary for 
addictions treatment are available.
    Accountability.--Accountability for treatment, i.e., who receives 
care, what kinds of resources they receive and sufficiency of 
treatment, are key issues. Managed care has changed the equation of the 
past in that treatment decisions are no longer the sole domain of 
health care providers. Therefore, standards to monitor the performance 
of managed care entities and meaningful oversight mechanisms are 
essential if accessibility is to be promoted and the positive cost-
benefits of treatment are to be realized. Likewise, existing clinical 
and performance standards for treatment provides need to be promoted 
and monitored to ensure treatment efficacy.
    The National Association of Addiction Treatment Providers and its 
members will continue to forge new treatment methodologies, new 
treatment measures and new partnerships with other professionals to 
ensure that the addiction treatment delivered is of the highest 
possible quality and provides the best opportunity for life long 
recovery.
    Therefore, NAATP is committed to:
  --Actively working to reduce the stigma associated with the disease 
        of Alcoholism and other Drug Dependencies;
  --Providing accurate information as to who the persons in treatment 
        and needing treatment really are (replacing the myth with a 
        person);
  --Seeking accessible and affordable treatment for all persons 
        diagnosed with the disease of alcoholism and other drug 
        dependencies;
  --Developing appropriate outcome measures so as to continue to 
        demonstrate the value of addiction treatment; and
  --Building a national database on addiction treatment.
                                 ______
                                 
 Prepared Statement of the National Council on Rehabilitation Education
    The Rehabilitation Act of 1973, as amended in 1992, has significant 
implications for Title III, Section 302 (Training) and the resultant 
Title I and Title III appropriations for the period from fiscal year 
1992 through fiscal year 1997. In the 1992 Amendments, the following 
changes impact the nature, scope, breadth, and distribution of the 
Title III Training appropriations:
  --Section 21 focuses on the need for recruitment, development, and 
        retention of underrepresented and unrepresented individuals and 
        requires the set-aside of 1 percent to meet these needs;
  --Section 803 of Title VIII requires specialized training for 
        distance education through telecommunications, Braille 
        training, parent information and training, Impartial Hearing 
        Officers training, and recruitment and retention of urban 
        personnel;
  --Title I strengthens the requirements for a comprehensive system of 
        personnel development, increasing congressional expectations on 
        State agencies to upgrade the qualifications of personnel 
        consistent with comparable State and professional standards 
        (i.e., a graduate degree, licensure, or national 
        certification);
  --The Amendments increased Section 130 programs for Native American 
        reservations, services for independent living (Title VII-B), 
        and the expansion and development of independent living centers 
        (Title VII-C), resulting in the need for preparation of 
        additional personnel entering the field of rehabilitation and 
        requiring continuing education for currently employed 
        personnel; and
  --The Amendments allocated a minimum of 15 percent of all Title III 
        appropriations for State agency in-service training grants.
    In addition to these legally mandated training requirements, 
numerous studies were commissioned by the Rehabilitation Services 
Administration (RSA), the National Council on Disability, and the 
National Institute on Disability and Rehabilitation Research, and were 
completed by rehabilitation personnel and professional organizations 
over the past fifteen years (Pelavin, 1991; Menz, 1989; Roberts, 1984; 
and Crisler, 1991), which have substantiated the existing shortages for 
current rehabilitation personnel and the need for future rehabilitation 
personnel. A number of Institutes on Rehabilitation Issues (i.e., Human 
Resource Development, 1991; Serving the Underserved, 1992; and 
Counseling and Guidance, 1993) have substantiated the need for 
qualified personnel throughout the State-Federal system and in special 
areas of priority needs. These studies further supported the contention 
that many agencies are experiencing significant loss of personnel 
through retirement and turnover. In the late 1980's and 1990's, State 
agencies have lost much of their institutional memory and talent 
related to the full implementation of the Rehabilitation Act and its 
subsequent Amendments.
    These statutory requirements and personnel and research studies are 
further impacted by increases in SSI and SSDI recipients and the 
authorization and implementation of the Americans with Disabilities 
Act. The needs of persons with disabilities to obtain employment remain 
high (Harris, 1994). While legislation mandates increased employment 
opportunities for persons with disabilities and improved quality and 
productivity of rehabilitation services, there is a critical disparity 
between the current level of appropriated Title III funds and the level 
of funding necessary to prepare new professionals and provide 
continuing education for rehabilitation personnel to empower them to 
comply with these mandates.
    The legislative mandates, the demands for rehabilitation services 
by adult consumers with disabilities, and the need for new personnel to 
meet expansion of program directions, replace retirements, and meet the 
turnover needs of personnel have created a critical demand for the 
continuing education of existing personnel and the educational 
preparation of new personnel.
              realities of the resources and rsa policies
    From fiscal year 1993 through 1998, the Federal appropriations for 
Title III was $39,629,000,000. This reflected level funding, while the 
Title I appropriations increased from $1,873,476,000 to $2,231,528,000, 
an increase of 19 percent. Coupled with the above demands, the rise in 
inflation, and the escalating costs of purchased educational services, 
the level funding for the past six fiscal years actually resulted in a 
significant reduction of resources and purchasing power.
    RSA policies and the Federal regulations changed during the fiscal 
years of 1993 to 1997. These changes involved an administrative policy 
for level funding for each year of a multi-year grant or cooperative 
agreement. In essence, for a 5-year grant or cooperative agreement, 
there are no cost- of-living increases. Many long-term training grants 
have been capped at a maximum of $100,000 per year, with a further 
mandate that at least 75 percent of all dollars must be directly 
related to student tuition and fees or stipend support. The latter 
requirement has been mandated by Department of Education regulations 
for 34 CFR 386.
    In the area of continuing education, the General Regional 
Rehabilitation Continuing Education Programs (General RRCEPs), which 
were first funded in 1974, have received level funding for the period 
from 1992 to 1997. The only increases have been task-specific addendums 
(i.e., diversity, employment, and streamlining) for a finite period. In 
the September 1997 Request for Proposal, the seven regional General 
RRCEPs which are competing for five-year funding are required to 
continue level funding for another five years. This category of 
training and the individual cooperative agreements will have received 
level funding for a ten-year period--with no reduction in outcomes and, 
in some cases, increased expectations.
    In 1995, RSA consolidated funds from a number of community 
rehabilitation long-term training grant categories and phased in 
Community Rehabilitation Program Regional Rehabilitation Continuing 
Education Programs (CRP-RRCEPs) over a three-year period (1995 through 
1997). The ceiling is $500,000 per year per each regional program for 
the five-year period of the cooperative agreement. There are no 
increases to compensate expanded training needs or inflation.
    Clearly, although the resources have remained constant in actual 
dollars, they have actually been reduced in purchasing power through 
erosion from inflation, cost-of-living increases, regulatory 
parameters, and expanded needs and expectations of consumers and 
rehabilitation service providers.
    While there are methods to increase efficiency, there are also the 
realities of actual cost demands. These demands include increases in 
tuition and fees, travel, and inflation. A program comparable to Title 
III, Training, within the U.S. Department of Education, the Office of 
Special Education and Rehabilitation Services, is the training 
authorized under the IDEA. Table 1 reflects the appropriated levels of 
Federal funding for training during a two-year period (FY 1995 and 
1996).

    TABLE 1--COMPARISON OF IDEA AND REHABILITATION ACT APPROPRIATIONS FOR FISCAL YEAR 1995-96 FOR STATE GRANTS AND TRAINING/PERSONNEL DEVELOPMENT \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                           Title I State     Title III      Percent for   State grants--     Personnel      Percent for
                      Fiscal years                           VR funds         funding        training          IDEA         development      training
--------------------------------------------------------------------------------------------------------------------------------------------------------
1995....................................................      $2,054.145         $39.629            1.93      $2,998.812        $114.254            3.67
1996....................................................       2,118.834          39.629            1.83       3,000.000        113.50 4            3.64
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Personnel development for IDEA includes personnel development, parent training, the clearinghouses, and the regional resource centers, which are
  categories within Title III of the Rehabilitation Act. All funds are reflected in millions of dollars.

    As reflected in Table 1, during the same two Federal fiscal year 
periods (1995 and 1996), the education and training appropriations 
within the IDEA received significantly higher funding levels. There is 
a substantial discrepancy between the two training programs in terms of 
actual dollars and the percent of appropriations for State grants. The 
support for personnel development, based on a percentage of the total 
allocation for direct services, is almost double for IDEA when compared 
to the State-Federal system of rehabilitation. In actual dollars the 
difference is in excess of $70 million.
      concerns for the future appropriations of title iii of the 
                     rehabilitation act, as amended
    The quality of services available for consumers with disabilities 
will be severely diminished without a significant change in the 
philosophical, legal, and fiscal approaches to the comprehensive system 
of personnel development.
    Therefore, to establish the base for an effective system of 
personnel development that will enable quality employment outcomes for 
adults with disabilities, the following resolution is proposed:
    Whereas the Rehabilitation Services Administration training dollars 
have remained the same since fiscal year 1993, and
    Whereas there have been inflationary increases and increases in the 
number of individuals needing training and education, and
    Whereas the 1992 Amendments to the Rehabilitation Act and related 
regulations require master's degree-prepared rehabilitation counselors 
and other qualified rehabilitation personnel to deliver vocational 
rehabilitation services, and
    Whereas training dollars must be spread across an increasing number 
of disciplines, and
    Whereas many staff members who entered into employment in the late 
1960's and early 1970's are now aging out of the vocational 
rehabilitation system,
    Whereby be it recommended by the National Council on Rehabilitation 
Education that the Rehabilitation Services Administration seek an 
increase of the appropriations for fiscal year 1999 to $50 million. 
This figure is derived from the cost-of-living adjustments that were 
afforded to Title I of the Rehabilitation Act from 1993 through 1998 
(19 percent) and from parity with the IDEA personnel development 
authorization.
    There should be an explicit mandate that the focus of training 
efforts in Title III be linked to employment-related outcomes. The 
portion of Title VIII related to distance learning needs to be expanded 
to enable present and future rehabilitation personnel to remain current 
and technologically competent.
    In addition to the proposed increase in appropriations, 
modifications are needed in the regulations and administration of Title 
III by the RSA. These changes should include the expansion of the terms 
and conditions for the payback provisions for stipend support. The 
current provisions are placing undue burdens on the universities for 
reporting and recordkeeping, which often extend beyond grant periods. 
With the development of public-private partnerships, the move toward 
deregulation, and privatization of services, the current definitions 
for graduates are restrictive. Finally, the policy for level funding of 
multi-year projects should be refined and adjusted to meet the needs of 
the students and employed trainees, the sponsoring organizations, and 
the public program.
                               summation
    The comprehensive system of personnel development is a positive 
mandate under the law and has far-reaching implications for 
organizations providing services through, and preparing personnel for, 
the public program of rehabilitation. However, without a proactive 
approach to appropriations that ensures that there will be sufficient 
funds for the future, the personnel development of new professionals 
and continuing education of current personnel will continue to fall 
critically short of the need. The legislative intent is clear--what 
remains in question is sufficient funding to meet the intent. Persons 
with disabilities deserve and should expect the highest quality 
services provided by competent, professional personnel.
                                 ______
                                 
   Prepared Statement of Dr. John F. Neylan, the American Society of 
                      Transplant Physicians [ASTP]
        enhancing transplantation medicine in the united states
    Thank you for the opportunity to be here today and to present 
testimony on behalf of the American Society of Transplant Physicians 
(ASTP). I am John Neylan, President-Elect of the ASTP, and Director of 
Transplant Out-Patient Services at Emory University.
    The American Society of Transplant Physicians is composed of 1,100 
physicians, surgeons and scientists. The practices and careers of our 
members focus on the broad fields of transplantation medicine and 
immunobiology and span across many medical and surgical specialties. 
The ASTP represents the largest group of transplant professionals in 
the United States.
    We are pleased that the Institute of Medicine (IOM) has invited a 
cross section of professionals and other interested individuals from 
the transplant community. No single institution or organization can 
affect significant change alone. If we are to continue to advance the 
field, it will be accomplished only through a partnership among all 
interested parties. The progress achieved over the past ten years is 
clearly a result of this kind of collaborative effort. For example, the 
volunteer-run Organ Procurement and Transplant Network (OPTN) 
administered by the United Network for Organ Sharing (UNOS) has 
developed a sophisticated national system for organ sharing.
    The transplant community has persuaded the Congress to extend anti-
rejection drug benefits for kidney transplant patients from 12 to 36 
months under the Medicare entitlement. There have also been steady 
improvements in clinical practice which have reduced transplantation 
morbidity and mortality. Surveys confirm that an overwhelming 
percentage of Americans are aware of and are in favor of the ``gift of 
life,'' though family refusal continues to be a significant impediment. 
Required request laws have been enacted in all 50 states. The organ 
procurement organizations (OPOs) have been responding to increased 
demands for efficiency and productivity and have consolidated from 120 
to 64. And finally, the funding for transplant-related biomedical 
research at the National Institutes of Health (NIH) has increased in 
the past decade.
    As we have heard this morning, enhancing transplantation requires a 
myriad of strategies including increasing organ donation, developing 
fair and equitable allocation principles, recognizing the concerns of 
special populations, building upon scientific and technical advances, 
and securing adequate access and funding for all patients in need of 
organ or tissue transplants. I would like to build upon this morning's 
discussion by presenting two very important and timely issues for your 
consideration. First I will discuss the ASTP's development of 
standardized listing criteria for determining when to list a patient on 
the national transplant waiting list. Second, I will provide a cursory 
review of the Society's assessment of the recommendations put forth by 
the original Task Force on Transplantation as a means in which to 
determine the public policy needs facing us today.
    Organ allocation, without a doubt, has engendered the most 
contentious public policy debate regarding transplantation in years. 
Throughout this debate, it has been observed that the variation in 
criteria physicians use to list a patient for transplant has 
contributed to the inconsistencies in waiting times among patients 
across the country. Furthermore, there is concern that, because of long 
waiting times in certain regions, there is a pressure on transplant 
programs to list patients early, before they actually require 
transplantation, a practice referred to as ``waiting list inflation.'' 
While many other factors contribute to these regional differences 
including OPO productivity and the available supply of local donors, 
the increasing discrepancy between the short supply of donor organs and 
expanding list of patients in need has spurred a growing demand to 
ensure that the organ allocation system is efficient and equitable.
    In early 1997, the ASTP successfully joined transplant physicians, 
surgeons, government agency representatives, UNOS, patients, ethicists 
and managed care providers on the NIH campus for a series of organ-
specific conferences. These conferences addressed the scientific basis 
supporting specific minimal listing criteria. Transplant programs were 
surveyed before each conference to identify areas of consensus and 
areas of controversy. The initial work in this area by UNOS provided 
the spring board from which the Society has subsequently developed 
recommendations for national, standardized criteria for placing 
patients on the organ-specific transplant waiting lists.
    Time does not permit me to review each of the listing criteria, 
however, a set of these has been made available in your handouts. A few 
key points are worth noting. It was agreed by the participants of the 
conferences that when a program places a patient on the waiting list, 
it should signify that the program would be prepared to transplant that 
patient immediately. Patients should not be placed on the waiting list 
only because it is perceived that he or she will likely need an organ 
transplant at some indeterminate point in the future. It was agreed 
that the minimal listing criteria should be simple, practical, based on 
existing published or, in some cases, unpublished clinical research, 
and have received broad agreement among the transplant community. The 
criteria should be readily verifiable and regularly reviewed to be 
modified where appropriate.
    Recently, a modified version of these recommendations was approved 
by the UNOS Board of Directors. These and other steps must be taken if 
we are to maintain the public's trust in the organ allocation system. 
This trust is absolutely essential if altruistic organ donation is to 
grow to the levels required to meet the needs of transplant recipients 
in the future. The consensus-building process used in the development 
of these listing criteria is an example of how the system can work. The 
ASTP encourages the IOM to carefully scrutinize the process for 
establishing public policy in organ allocation and other areas. We 
support an approach, where those actively involved in transplantation 
come together to review scientific evidence, reach a consensus, and 
make recommendations. As I mentioned in my introduction, the ASTP, in 
it's own efforts to forecast the future needs of transplantation, 
conducted an internal review of the Task Force on Transplantation's 
recommendations. As you are aware, the Task Force was created by 
statute with the passage of the National Organ Transplant Act in 1984. 
We believe the more than 70 recommendations put forth by the Task Force 
presents a national blueprint from which most public policy decisions 
have been made in the past decade. From a public policy perspective, we 
felt much could be learned from revisiting these recommendations to 
determine what has been accomplished, what remains a work in progress, 
and what has been left undone.
    The ASTP Public Policy Committee and the Board of Directors 
recently completed a position paper that created a ``scorecard'' that 
compared 1986 Task Force recommendations with the state-of-the-art 
today. Each of the recommendations was reviewed and scored according to 
present day results. Enclosed in your handouts, is a copy of the ASTP's 
White Paper on Transplantation which reviews our conclusions and 
describes areas of needed improvement. The White Paper addresses four 
specific areas: organ donation, organ allocation, access to 
transplantation and biomedical research. Our agenda is ambitious, but, 
we are confident that each and every recommendation is attainable. In 
the remaining time, I will outline a number of key points.
                             organ donation
    The transplant community is acutely aware that nearly 10 patients 
die each day while waiting for an organ. Despite improvements in the 
organ retrieval system, allocation simply has not kept pace with 
demand. In 1990, there were 21,914 patients on the waiting list; today, 
there are over 51,000 patients on the waiting list representing an 
increase of 133 percent over six years. Tragically, the number of 
donors has increased by only 43 percent over the same period. The 
reasons for the lack of transplantable organs are numerous, but family 
refusal as I mentioned earlier is the leading cause for the loss of 
potential donors, averaging over 40 percent. Recently, the Institute of 
Medicine recommended that, ``Increasing the donation of kidneys receive 
the highest priority in the coming decades.''
    The ASTP urges federal and state governments, providers, 
professional organizations and patient communities to work together in 
translating the extremely high public awareness of the benefits of 
organ donation into a pro-active national effort to increase the actual 
practice of this altruistic act.
                            organ allocation
    Many of the Task Force organ sharing recommendations have been 
implemented through a single, national OPTN. UNOS continues to work 
towards a fair and equitable national allocation scheme, however, as we 
have noted, there are still unresolved questions and problems. The ASTP 
proposes:
  --The Scientific Registry should develop policies to make the system 
        more user friendly concerning access to data and its use.
  --A mechanism is needed to minimize the persistent problem of organ 
        discard rates. In 1995, 1,200 kidneys, 500 livers and 250 
        hearts were procured and ultimately discarded.
  --The Task Force recommendation to regionalize histocompatibility 
        typing should be implemented to reduce unnecessary and 
        duplicative effort and expense.
  --The Congress needs to embrace the OPTN guidelines developed by UNOS 
        and enact long overdue legislation to reauthorize the 
        Transplant Act so that authority will finally be in place to 
        appropriately administer the system of organ sharing.
                       access to transplantation
    The issues surrounding access to transplantation are complex and 
controversial. To build upon and enhance the existing system we 
propose:
  --Uniform medical listing criteria for each solid organ category 
        (heart, liver, lung, pancreas and kidney) should be developed. 
        Patients who meet the accepted criteria should be allowed 
        access to transplantation, regardless of their ability to pay. 
        As managed care grows, the ASTP sees a need for the federal 
        government to assert its leadership to assure that each managed 
        care plan provides equal access to transplantation.
  --The government should extend Medicare coverage and payment for 
        anti-rejection drugs for the life of the graft.
  --With Medicaid reform, the federal government should assure that all 
        states have uniform eligibility and coverage criteria for 
        transplantation.
  --To ensure that patients make informed choices regarding 
        transplantation, the HCFA and private insurance carriers should 
        annually advise patients of their treatment options.
  --National education programs targeted to minorities should be 
        developed to educate these under-served groups about the ``gift 
        of life'' as well as the medical consequences of a transplant. 
        It is imperative that there be a thoughtful review of previous 
        minority education programs coupled with this effort.
  --There is disturbing evidence that transplant recipients experience 
        employment discrimination. The Congress should schedule 
        hearings to determine the extent of discrimination in 
        employment, insurance coverage, etc. and move to amend the 
        Society Security Act, the job training program, and the 
        Vocational Rehabilitation Act to eliminate such discrimination 
        and design programs to ensure appropriate access to employment 
        medical benefits.
  --The special issues and specialized needs of children should be 
        given a high priority. All funding sources, including Medicaid 
        and Medicare, private insurance and HMOs must recognize the 
        additional costs necessary for the appropriate provision of 
        transplantation care to children, particularly infants and the 
        very young.
                          biomedical research
    Research is central to all of the transplantation issues previously 
addressed. We submit that increased funding for transplantation 
research will lead to solutions that will save lives. Both the Task 
Force and an IOM report recommended that research receive high 
priority. While research initiatives since 1986 have made progress in 
all of the areas cited by the Task Force, the ASTP believes that we are 
now on the threshold of many important breakthroughs in the areas of 
rejection-immunosuppression, tolerance and xenografts.
    Next to issues related to the supply of organs for patients on the 
waiting lists, those of basic and clinical research are of the highest 
priority. Clinical and basic transplantation funding at the NIH must be 
increased. We propose that Congress, through the authorization and 
appropriations process, expand the general transplantation research 
authority of NIH. In particular, we recommend that Congress designate a 
number of high priority initiatives at the NIDDK, the NIAID and the 
NHLBI. We also recommend that the NIAID be designated as the lead 
coordinating institute for the NIH transplantation research effort in 
the next decade, The Decade of Transplantation.
    I have submitted a copy of the White Paper for this hearing's 
record. We plan to distribute this paper to members of the Congress, 
selected government agencies, and others in the transplant community. 
The ASTP invites the IOM and all other interested groups to comment and 
reflect on the recommendations presented in this white paper. We would 
welcome the opportunity to work with the Institute to publicly explore 
these issues further. I urge each of you to read the document. We 
believe it is a blueprint for The Decade of Transplantation.
    The ASTP is enthusiastic about the potential for a variety of 
important studies on organ transplantation in the United States today. 
We strongly endorse an IOM study that would evaluate the field, 
identify problems and trends and suggest solutions. It has been more 
than ten years since the Congressionally mandated (Public Law 98-507) 
Department of Health and Human Services report of the Task Force on 
Organ Donation issued its report and more than seven years since the 
landmark Institute of Medicine report, Kidney Failure and the Federal 
Government. There is much to do to ensure that every person on the 
waiting list has the opportunity to obtain the benefits of organ 
transplantation. We believe that we are at a crossroads, and that the 
time is right to unite our community to enhance transplantation as we 
approach the beginning of the new millennium. The ASTP stands ready to 
assist in every facet of the process.
    Thank you.
                                 ______
                                 
 Prepared Statement of Dr. David L. Heymann, World Health Organization
the need for global surveillance and monitoring for infectious diseases
The challenge
    Infectious diseases remain a global problem in the late twentieth 
century. Global surveillance is an urgent necessity to protect the 
health of people throughout the world. There is reason to believe that 
the emergence of previously unknown diseases and the re-emergence of 
old ones is increasing. One-third of the 52 million deaths in the world 
in 1995 were due to infectious diseases, and this ratio remained the 
same in 1996 and 1997. Infectious diseases spread when adequate 
financial and human resources are not devoted to infectious disease 
control and when microbes in animals find suitable conditions to jump 
the species barrier and infect humans. Factors responsible for the 
increase in infectious diseases include social changes such as mass 
population movements, rural-to-urban migrations and accelerated 
urbanization, population growth, rapid transport, global trade, new 
food technologies, and new life styles as well as environmental changes 
such as altered land use patterns and irrigation that increase the risk 
of human exposure to animal reservoirs and vector-borne infections. A 
new outbreak may first appear in a circumscribed area, but with 
expanding global travel and trade, the disease can span entire 
continents within days or weeks as influenza periodically demonstrates. 
The diseases that have crossed, or threaten to cross, international 
borders menace international public health security. Today these 
infectious disease outbreaks and epidemics are not only costly to the 
economies of the countries in which they occur, but are also a concern 
for all countries because no country is safe from infectious disease.
    For example, during 1997:
  --Major cholera epidemics spread throughout eastern Africa, affecting 
        hundreds of thousands of people in more than ten countries over 
        several months; trade sanctions were unnecessarily placed on 
        fish exports from these countries resulting in severe economic 
        impact on their fragile economies;
  --Yellow fever fatalities were reported in seven countries in Africa 
        and South America;
  --Meningitis caused major epidemics in Africa, with over 70,000 
        deaths reported in the 1996-1997 season;
  --More than 15,000 cases of typhoid fever with resistance to first 
        line antibiotics occurred in Tadjikistan;
  --Epidemic typhus resurged in Burundi with over 30,000 cases and 
        untold deaths;
  --An avian influenza virus emerged in humans in Hong Kong, killing 
        six out of eighteen people, and was carefully monitored for its 
        potential to be the next pandemic influenza threat;
  --Rift Valley Fever afflicted thousands of people, killing hundreds 
        and many of their livestock in Kenya and Somalia;
  --The prevalence of hepatitis C continues to increase in countries 
        where blood is not screened prior to use and where 
        sterilization of medical equipment is faulty;
  --Lassa fever, with high mortality, re-emerged in Sierra Leone;
  --An outbreak of dengue fever occurred in Cuba for the first time 
        since the 1981 epidemic;
  --The investigation of an unexpectedly large human monkeypox outbreak 
        in Africa raised new issues about this important disease and 
        the safety of smallpox vaccination in the era of AIDS;
  --The number of cases of new variant Creutzfeldt-Jakob Disease 
        reached twenty-four in the United Kingdom and France combined 
        with the continuing threat of bovine spongiform Encephalopathy 
        (BSE or mad cow disease), and the United Kingdom's economic 
        loss from BSE was estimated to have reached 5.7 billion U.S. 
        dollars;
  --Eschericia coli 0157 continued to surface in industrialized 
        countries including Japan and the United States;
    Vancomycin-resistant Staphylococcus aureus was identified in Japan 
for the first time, and later in the United States.
The solution
    The concern of industrialized countries such as the United States, 
where prevention and control efforts have dramatically decreased 
infectious disease mortality, is international public health security: 
ensuring that infectious diseases which are occurring elsewhere do not 
spread internationally across their borders.
    The concern of developing countries is to detect and stop 
infectious diseases early, thus avoiding high mortality and negative 
impacts on tourism and trade. Yet, developing countries are constrained 
by the lack of appropriate technologies and the difficulty of financing 
the necessary interventions on a sustainable basis.
    The solution, which addresses the interests of both the 
industrialized and developing countries, is to combine their efforts to 
strengthen detection and control of infectious disease. The major 
requirements for the prevention and control of infectious diseases 
globally and nationally are:
  --1. Strong global and national epidemiological surveillance and 
        public health laboratories to detect infectious diseases, to 
        provide data for analyzing and prioritizing health services, 
        and to monitor and evaluate the impact of control efforts plus 
        global monitoring and alert systems to bring together 
        laboratories and disease surveillance systems from all 
        countries to share information internationally through 
        electronic and printed media.
  --2. Sustainable and well-managed infectious disease control programs 
        which effectively diagnose infectious diseases and administer 
        vaccines, curative drugs, and other interventions where and 
        when they are needed.
  --3. Continuing research and development of simple-to-use and robust 
        vaccines, antimicrobial drugs, and laboratory tests for 
        effective surveillance, prevention, and control of infectious 
        diseases.
WHO's global strategy and collaboration with CDC
    To combat the spread of infectious disease a global framework is 
needed to build up the necessary networks for surveillance and control 
of infectious diseases. The World Health Organization works to build 
such a global framework and effective networks through its Division of 
Emerging and other Communicable Disease Surveillance and Control (EMC).
    WHO has responded to the threats of infectious disease by 
developing a four-part strategy for international surveillance.
    First, WHO has instituted a global monitoring and alert system for 
communicable diseases that brings together laboratories and disease 
surveillance systems from all countries to share information 
internationally through electronic and printed media. Revision of the 
International Health Regulations (IHR) is underway and will be proposed 
for adoption by the World health Assembly in 1999. The new 
International Health Regulations will require Member States to report a 
spectrum of communicable disease syndromes of international public 
health importance in addition to the three specific diseases covered at 
present. These proposed new regulations are now being field-tested.
    Second, WHO rapidly and widely disseminates global information 
collected from national Ministries of Health, WHO Collaborating 
Centers, and governments via electronic means and the WHO World Wide 
Web site. EMC also has an electronic alert system designed to help 
facilitate expert verification of unconfirmed outbreak information on a 
confidential basis.
    Third, WHO helps in establishing national and regional preparedness 
for communicable disease prevention and control. EMC provides manuals, 
standards, and guidance to national centers. The weak link in current 
global monitoring capacity is the collection of clinical/
epidemiological data. At present, few countries have an adequate 
national infectious disease monitoring system, and most are extremely 
weak. Some of the most important geographical regions in terms of 
disease emergence, are the weakest, and this situation needs to change.
    Finally, WHO encourages international preparedness for communicable 
disease prevention and control, which supports and augments national 
and regional preparedness while national systems improve their 
capabilities.
    The key to global surveillance and control of infectious diseases 
has been a collaborative effort between WHO and its partners, including 
national-level agencies like the Centers for Disease Control and 
Prevention (CDC), which play a critical role in continuing domestic 
surveillance and control which minimizes the risk of international 
transmission of infectious diseases.
    WHO's goal is to strengthen national preparedness in all countries, 
which will require a substantial long-term commitment of human and 
material resources by many partners to strengthen the infrastructure 
and processes for disease control and surveillance in poorer countries. 
WHO's role has been to reinforce global laboratory-based surveillance 
by providing training and support to existing WHO Collaborating Centers 
and laboratories. WHO gives seed funding for development and 
distribution of diagnostic reagents and designates new centers and 
laboratories to fill geographic gaps. CDC already provides valuable 
assistance in quality assurance to WHO supported laboratories 
monitoring bacterial, viral, parasitic and zoonotic diseases throughout 
the world. CDC also provides expert training in epidemiology and other 
areas of public health, working with WHO and other international 
partners.
    WHO has improved global epidemiological surveillance and 
facilitated rapid reporting of and response to infectious disease of 
international public health importance. Surveillance has specifically 
focused on developing a system to detect and investigate unusual 
infectious disease outbreaks, whether naturally occurring or 
intentionally caused. WHO has been working with the monitoring group of 
the Biological Weapons Convention (BWC) to make sure that all diseases 
of concern to BWC are included in these surveillance guidelines. WHO 
Member States and WHO's network of regional offices, country 
representatives, and technical partners such as CDC are now being 
linked electronically for verification and response. The response 
mechanism permits rapid and coordinated international investigation and 
containment of infectious disease outbreaks of international 
importance. WHO-coordinated international response broadens 
international cooperation so that no country is required to shoulder 
the entire burden of responding to an infectious disease outbreak of 
international importance. Without such a coordinated international 
response, many disease outbreaks could have resulted in extensive 
international spread.
    EMC is strengthening global surveillance through adding new 
collaborating partners to the network of WHO Collaborating Centers in 
infectious disease and/or the anti-microbial resistance (ARM) 
monitoring network. WHO is working to incorporate military laboratories 
which often have good capabilities even in poorer countries, together 
with WHO Collaborating Centers into the global monitoring system for 
diseases and antimicrobial resistance.
    Increased support to CDC for international collaboration with WHO 
would permit more rapid strengthening of surveillance and control 
capabilities worldwide, especially in poor countries. By permitting 
rapid detection and containment of infectious diseases when and 
wherever they occur, the risk of their entering the United States of 
America is minimized. Together, WHO and CDC will be working to advance 
all of the elements of current efforts to strengthen the global 
monitoring system to ensure international public health security.
                                 ______
                                 
Prepared Statement David B. Moore, Coordinator, Health Professions and 
                      Nursing Education Coalition
    The Health Professions and Nursing Education Coalition (HPNEC) is 
pleased to submit its recommendations for fiscal year 1999 funding for 
the health professions and nursing education programs authorized under 
Titles VII and VIII of the Public Health Service Act. HPNEC is an 
informal alliance of over 40 organizations comprising a variety of 
schools, programs, and individuals dedicated to educating professional 
health personnel. All members of HPNEC are united in our belief that 
these programs are essential to the development and training of health 
professionals and that these programs are critical to our nation's 
efforts to provide professional health services to underserved and 
minority communities.
    The members of HPNEC are encouraged by the Administration's 
recognition of the importance of these programs as reflected in the 
President's fiscal year 1999 budget. The budget illustrates the 
Administration's understanding that the federal government must take a 
leadership role in ensuring the supply, distribution, diversity, and 
quality of this nation's health care workforce. The Administration's 
budget proposal emphasizes the importance of having health care 
professionals in areas where they are most needed, and highlights 
strategies to achieve this goal: increasing the number of health 
providers from minority backgrounds; fostering community- based 
education; and enhancing service to underserved communities.
    HPNEC recommends that Titles VII and VIII receive an appropriation 
of $306 million for fiscal year 1999. This recommendation is a 5 
percent inflationary increase over the amount Congress appropriated for 
these programs in fiscal year 1998. This appropriation is necessary to 
maintain current efforts to address our nation's rapidly changing 
health care system.
    These programs are designed to meet the nation's needs for an 
expanded supply of primary health care providers and public health 
professionals. The original purpose of Titles VII and VIII were to 
train more health professionals in fields experiencing shortages, 
improving the geographic distribution of health professionals, and 
increasing access to health care in underserved areas. However, the 
need for these programs will become increasingly critical to ensure 
that the medical innovations and new technologies that will result from 
increased support for research will be properly applied to individuals 
in or most needy communities. With your support, these programs will 
continue to achieve these missions by providing support for the health 
professions in the form of loans, loan guarantees, scholarships to 
students, and grants and contracts to institutions. In this rapidly 
changing health care environment, it is crucial Title VII and Title 
VIII programs receive an appropriation of $306 million for fiscal year 
1999 in order to meet the mission set out in their original 
authorization.
    The following pages describe each of the health professions and 
nursing education programs authorized under Titles VII and VIII. 
Examples of the positive impact of these programs are provided in 
italics.
                               title vii
Title VII programs provide opportunities for health professions 
        students to train and provide primary and preventive care to 
        people of medically underserved communities
             loans for disadvantaged students [section 721]
    Loans for Disadvantaged Students go to eligible health professions 
schools allowing them to provide loans to disadvantaged individuals. 
Schools receiving funds must carry out programs for recruiting and 
retaining students from disadvantaged backgrounds and recruiting 
minority faculty. The fiscal year 1997 appropriation was $6.717 
million; the fiscal year 1998 appropriation is $6.741 million. The 
Health Professions Student Loan Program has helped approximately 700 
students at Ohio State University over the past three years. These 
loans have kept students from having to borrow alternative loans or 
having to increase the use of unsubsidized loans to meet their Cost of 
Attendance. This has enabled students to not only reduce their debt, 
but have loans with better terms when repayment occurs. Rita Spring, 
Financial Aid Officer for the College of Veterinary Medicine, recently 
spoke with John Groah, a 1996 graduate from the College of Veterinary 
Medicine. He received not only Health Professions Student Loans, but 
Loans for Disadvantaged Students while at Ohio State. John was from 
McConnelsville, Ohio, a rural part of southern Ohio and considered part 
of the Appalachian Mountain region. John has returned home to 
McConnelsville and is engaged in a practice with one other 
Veterinarian. John feels that he would not have been able to graduate 
from Veterinary School without the help of these two programs. He is 
doing well and is contributing to his community.
 scholarships for students of exceptional financial need [section 736]
    Exceptional Financial Need (EFN) scholarships are awarded by 
allopathic medical, osteopathic medical, and dental schools to students 
who can demonstrate extreme financial hardship. Each scholarship 
consists of payments equivalent to the student's tuition and other 
educational expenses, such as books and laboratory fees. Students who 
accept EFN scholarships must agree to enter and complete a primary-care 
residency and serve in a primary-care career for five years after 
finishing the residency. The fiscal year 1997 appropriation of $11.33 
million resulted in nearly 650 scholarships for needy students; the 
fiscal year 1998 appropriation is $11.371 million.
    Dr. Gary Schluckebier, and Exceptional Financial Need Scholarship 
recipient, graduated from the Indiana University School of Dentistry in 
1995. Upon graduation Dr. Schluckebier served one year in an inner-city 
clinic in Chicago, Illinois providing oral health services to HIV/AIDS 
patients. Dr. Schluckebier now has a general dentistry practice in the 
small economically depressed town Michigan town of Niles. Scholarships 
for Disadvantaged Students [Section 737]
    While African Americans represent 12 percent of the population of 
the United States, only 2 to 3 percent of our nation's physicians, 
dentists, pharmacists, psychologists, and veterinarians are African 
American. Historical data documents that African Americans and other 
minority health care professionals are more likely to serve in 
underserved communities in primary-care settings. This program provides 
funds to health professions and nursing schools for scholarships for 
disadvantaged persons from all ethnic backgrounds to help defray the 
cost of education at the baccalaureate and graduate levels, thereby 
encouraging the recruitment and retention of these individuals. More 
than 4,980 health professions students received scholarships through 
the fiscal year 1997 appropriation of $18.676 million; the fiscal year 
1998 appropriation is $18.737 million--30 percent of this appropriation 
is reserved for nursing students.
          faculty loan repayment and fellowships [section 738]
    This program repays loans for and provides added training to 
minority individuals from disadvantaged backgrounds who serve on the 
faculty of health professions schools. The fiscal year 1997 
appropriation of $1.061 million benefited 23 faculty members; the 
fiscal year 1998 appropriation is $1.065 million
                  centers of excellence [section 739]
    Section 739 recognizes the need to increase the number of 
minorities in the health professions and to improve the health status 
of minorities. The Centers of Excellence program seeks to strengthen 
our national capacity to educate minority students by offering special 
support to institutions that train many of America's minority health 
professionals and serve as the primary source of health care to 
minority populations. Funding for Centers of Excellence supports 
programs to improve student recruitment, retention, training, and 
research at predominantly minority institutions. The education of 
nearly 3,520 students at 22 institutions was enhanced by the fiscal 
year 1997 appropriation of $24.718 million; the fiscal year 1998 
appropriation is $24.798 million.
    The Tuskegee University School of Veterinary Medicine has utilized 
Centers of Excellence funding to gradually increase faculty salaries to 
85 percent of the national average, making Tuskegee more competitive in 
recruiting faculty. Tuskegee has also increased its number of library 
personnel and updated its audiovisual tutorial holdings. Centers of 
Excellence funding has contributed to Tuskegee becoming a national 
leader in recruiting and training students specializing in the human 
health aspects of veterinary medicine. These specially trained 
veterinarians combat diseases such as E. coli that threaten public 
health.
                 disadvantaged assistance [section 740]
    Grants made to health professions schools under the Health Careers 
Opportunity Program (HCOP) are used to identify and recruit 
disadvantaged students, facilitate their entry into school, and help 
them complete their education successfully. HCOP funds are also used to 
provide any necessary preliminary education and to pay for scholarships 
(known as Financial Aid for Disadvantaged Health Professions Students 
scholarships) and stipends to defray the costs of attendance. HCOP 
grants supported by the fiscal year 1997 appropriation of $26.785 
million assisted 134 projects that served 6,122 students; the fiscal 
year 1998 appropriation is $26.779 million.
    Despite the fact that the provision of health care in this country 
is undergoing rapid changes, there has been insufficient funding of 
training programs for health care professionals, such as psychologists 
who are equipped to deal with behaviorally based social problems (e.g., 
violence, teen pregnancy, and the spread of AIDS and other sexually 
transmitted infections). The Wright State University School of 
Professional Psychology's Minority Access to Professional Psychology 
(MAPP) is designed to assist individuals from cultural, racial, and 
other diverse and/or disadvantaged backgrounds to enter and graduate 
from doctoral training programs in psychology. The three program 
components are:
  --Preliminary education, which targets undergraduate minority and 
        disadvantaged students (at the sophomore levels and above) from 
        area universities and provides them with academic skill-
        building and enrichment experiences;
  --Facilitating entry, which is designed to reduce barriers to 
        minority and disadvantaged students' applying and being 
        accepted for clinical psychology graduate study; and RETENTION, 
        which includes the provision of preventive and remedial 
        academic skill development as well as nonacademic personal and 
        professional development support.
              area health education centers [section 746]
    Section 746 provides grants for the creation and operation of area 
health education centers (AHECs). The AHEC program provides clinical 
training opportunities to health professions and nursing students and 
residents in rural settings by extending the resources of academic 
health centers to communities in need of health care and education. 
Through this linkage, AHEC projects, which eventually become self- or 
state-supported, form networks of health-related institutions to 
provide educational services to students, faculty, and practitioners, 
and ultimately to improve health-care delivery. The fiscal year 1997 
appropriation of $28.490 million supported grants to 36 AHEC projects 
that train 21,075 students and residents across the country; the fiscal 
year 1998 appropriation is $28.587 million.
    The University of Florida College of Medicine through coordination 
with the University of Florida Health Science Center AHEC program has 
developed a mandatory three-week community primary care rotation for 85 
first-year medical students. The program has presence in all 37 north 
Florida counties in the North Florida AHEC cachment area. This program 
was made possible by the AHEC system and its federal funding. The 
program has been in place for 6 years and while it is too early to 
determine placements in these primarily underserved areas, several 
other outcomes have developed. The value and positive role these 
students have played in the various sites across North Florida have 
resulted in additional rotations for 3rd and 4th year students at the 
same sites. In addition, rotations for other health professions have 
developed in these areas. Also, along with the first-year student 
rotations, the AHEC program was central in establishing rotation sites 
for primary care residents and nurse practitioners. These latter 
trainees have added service capacity to the communities they train in 
since they are licensed practitioners. It is safe to say these programs 
would not have emerged as rapidly or as successfully without the AHEC 
component
         health education and training centers [section 746(f)]
    The Health Education and Training Center (HETC) program was created 
to improve the supply and distribution of health professionals along 
the border between the United States and Mexico, as well as in other 
underserved areas to population groups that have demonstrated serious 
unmet health care needs. HETC projects employ educational incentives to 
attract and retain health care personnel and incorporate a strong 
emphasis on wellness through public health education activities. Each 
project also supports at least one training and education program for 
physicians and one for nurses to provide a portion of the clinical 
training for students in the service area. The fiscal year 1997 
appropriation of $3.752 million assisted ten projects; the fiscal year 
1998 appropriation is $3.765 million.
    Nova Southeastern University College of Osteopathic Medicine (NSU-
COM) serves as the lead institution of the Florida Border Health 
Education and Training Centers Program, a partnership of the four 
medical schools in Florida, which focuses on the State's diverse and 
complex immigrant, migrant, and minority patient populations. This 
program now provides a unique national model of collaboration between 
osteopathic, allopathic, private and public schools of medicine. Among 
the many special training initiatives have been a ``Culturally 
Competent Health Care'' Teleconference reaching nearly 600 participants 
in over 35 sites across Florida. These site encompass providers from 
health departments, community and migrant health centers, and hospitals 
in rural and remote communities where a large number of immigrants from 
Florida's multiethnic and multilingual cultures are served. Because of 
its success, this Teleconference also resulted in the production of a 
videotape which is now being used in follow-up workshops and seminars.
                 family medicine training [section 747]
    Section 747 family medicine training funds are used to help develop 
and maintain an infrastructure for the production of family physicians. 
Funding is used for the establishment of departments of family medicine 
within medical schools, the development of third-year clerkships in 
family medicine for medical students, the training of family practice 
residents, and development of teaching and education skills for family 
medicine faculty. The General Accounting Office and others have 
acknowledged the importance of this Title VII funding in the creation 
and maintenance of family medicine departments and divisions in medical 
schools.
    The fiscal year 1997 appropriation of $49.3 million funded 322 
projects, including grants to school to support predoctoral training; 
to hospitals to support graduate training for 950 students in family 
medicine; to various institutions engaged in facility development 
activities; and for the establishment and maintenance of family 
medicine departments. The fiscal year 1998 appropriation is $49.42 
million.
    Medical College of Georgia. A number of years ago the department 
was awarded an innovative residency curricula grant to develop academic 
community partnerships with a network of rural health clinics in a four 
county area--an area that was a Health Professional Shortage Area, 
unable to keep private physicians, and economically depressed. The 
success of that grant is in the development of self-sustaining rural 
health clinics as teaching sites with residents and students providing 
care under the auspices of a teaching physician. Physicians graduating 
from this program have subsequently been hired to direct these sites 
and have stayed for the long term providing continuity of care, and 
living in the communities that they serve.
general internal medicine and general pediatrics training [section 748]
    General internists and pediatricians are two additional and 
important generalist specialties. Section 748 provides funds directly 
to general internal medicine and general pediatrics training programs, 
which together train the most medical students. In an effort to produce 
more generalists, these training programs expose students to generalist 
role models in community and ambulatory settings, where most 
generalists are likely to practice, and encourage general faculty 
development programs that produce future generalist teachers and role 
models.
    Pediatrics has historically been a generalist dominated field of 
medicine with over 70 percent of practicing pediatricians engaged in 
primary care practice. Faced with increases in the incidence of AIDS, 
substance abuse, adolescent pregnancy and other health concerns, future 
pediatricians will be expected to manage both acute and chronic health 
programs, care for children and adolescents with disabling conditions, 
and provide counseling for problems that are psychosocial or behavioral 
in nature. Section 748 grants in pediatrics have supported training in 
a variety of diverse ambulatory and community-based sites including 
nontraditional settings such as, juvenile detention centers, homeless 
shelters, child nutrition programs, child care centers and community 
health centers. The fiscal year 1997 appropriation of $17.68 million 
supported nearly 1506 residency positions in general internal medicine 
and general pediatrics and nearly 1,000 faculty positions in these two 
areas of medicine. The fiscal year 1998 appropriation is $17.678 
million.
    With Title VII funds, the Department of Pediatrics at Harbor/UCLA 
Medical Center (a county-funded institution serving mainly underserved 
indigent Hispanic patients) expanded services, developed new programs, 
and trained physicians who have remained general pediatricians in inner 
city underserved communities of California. Approximately 100 such 
pediatricians have been trained, and these generalists provide 
comprehensive and preventive care to a large number of vulnerable and 
economically disadvantaged children.
              general dentistry residencies [section 749]
    General Dentistry Residency Training provides dentists with the 
skills and clinical experiences needed to deliver oral health care to 
the full community of patients. General Dentistry programs include off-
site rotations in community-based settings such as community health 
centers, nursing homes, geriatric day care facilities, state 
institutions, and children's hospitals. Because the General Dentistry 
program emphasizes primary care, dentists are trained to deliver a 
broader range of services to their patients and as a result, 
consistently refer fewer patients to specialists. This is especially 
important to the underserved populations that often face financial and 
logistical barriers making specialized care unobtainable. Eighty-seven 
percent of the dentists that receive General Dentistry Training remain 
in primary care. Programs have consistently met the statutory 
preference of demonstrating that graduates establish their permanent 
practice or spend a significant portion of time working in underserved 
communities. However, there are not enough of these residency slots for 
dental school graduates seeking this training. The General Dentistry 
Residency Training program does not increase the supply of dentists, 
but provides enhanced training for primary care dentists. The need to 
increase these training opportunities was supported by the 1995 
Institute of Medicine Report on Dental Education. The fiscal year 1997 
appropriation of $3.785 million supported 41 General Dentistry 
Residency Training programs.
    The fiscal year 1998 appropriation level is $3.798 million.
    The General Dentistry Residency program at Meharry Medical College 
School of Dentistry in Nashville, Tennessee, is currently in the second 
year of a three-year federal General Dentistry Residency grant. A 
significant feature of the Meharry program is the involvement of the 
General Dentistry residents as a part of an interdisciplinary health 
care team delivering medical and dental care to rural populations in 
west Tennessee. Over 40 percent of the General Dentistry program 
graduates continue to practice in medically underserved communities 
throughout Tennessee and the United States.
                   physician assistants [section 750]
    Section 750 authorizes grants for schools of medicine and 
osteopathic medicine, as well as colleges and universities, to meet the 
costs of projects to develop and operate or maintain accredited 
programs for the training of physician assistants and faculty. Programs 
under this section are oriented toward primary care and stress 
educational experiences in both rural and urban areas that are 
medically underserved or facing shortages of qualified health 
professionals. The fiscal year 1997 appropriation of $6.376 million 
provided 38 awards for the training of 3,250 physician assistants 
nationwide; the fiscal year 1998 appropriation is $6.398 million.
    The establishment of the Physician Assistant Program has enabled 
Western University to develop and implement a 20-week cross-cultural 
medicine curriculum designed to provide physician assistant students 
with the skills needed to practice in culturally diverse communities. 
In addition, the program has been designed to provide clinical 
practicum in primary care and increase the clinical rotation time in 
primary care from 12 to 16 weeks. As a result of Title VII funds, 
Western University PA students consistently score the highest on State 
Board exams.
            podiatric primary care residencies [section 751]
    Grants are awarded under Section 751 for assistance with the costs 
of training podiatric physicians to provide primary health care 
services. Funds awarded through this section help podiatric residency 
training programs implement new primary-care projects and provide 
financial assistance to residency trainees enrolled in these programs. 
Thirty-nine podiatric physicians in five projects were supported by the 
fiscal year 1997 appropriation of $677,000; the fiscal year 1998 
appropriation is $679,000.
 public health traineeships, special projects, and preventive medicine 
                            [sections 761-3]
    Public health professionals will play a unique role in the evolving 
managed care environment, and health agencies and organizations at 
national, state, and local levels will rely even more heavily on 
University graduate schools of public health and other public health 
and preventive medicine projects to provide leadership in the form of 
comprehensively trained public health professionals.
    Section 761 provides Traineeships for individuals pursuing courses 
of study in fields experiencing severe shortages of public health 
professionals, such as dental public health, epidemiology, 
environmental health, biostatistics, managed-care administration, and 
risk analysis. Section 762 authorizes the extension of grants to 
schools of public health for projects in the areas of preventive 
medicine, health promotion and disease prevention, and improving access 
to and quality of health services in medically underserved communities. 
Section 763 provides funds to schools of medicine, osteopathic 
medicine, public health, and dentistry for the development and 
maintenance of preventive medicine and dental public health programs, 
and extends financial assistance to residents enrolled in such 
programs.
    Preventive medicine physicians and dentists are uniquely trained in 
both clinical medicine or dentistry and public health, and seek to find 
the most cost-effective ways to reduce the risk of diseases, 
disabilities, and death in individuals and population groups. Support 
through Title VII is necessary to alleviate the serious shortage of 
public health professionals such as dental public health specialists; 
in 1994, for example, there were only 116 such board-certified 
specialists and only 12 graduates from the 19 accredited programs.
    The fiscal year 1997 appropriation of $7.998 million supported 69 
projects and awards, approximately 123 preventive medicine and dental 
residents, and more than 987 public health trainees. The fiscal year 
1998 appropriation is $8.025 million.
    Section 762 (Special projects) funded a project with the Tulane 
University School of Public Health and Tropical Medicine to develop a 
community health strategic plan. A task force of more than 60 members 
of the university, community, non-profits and public agencies came 
together to create a community health strategic plan to establish 
partnerships which truly address community needs. Outcomes of this 
program include the establishment of a school-based adolescent mental 
health clinic, expansion of primary care facilities to low- income 
neighborhoods, school health clinics to promote healthy lifestyles for 
children, and a five-year study in 24 elementary schools to assess 
school-based interventions in promoting healthful behaviors. As an 
outgrowth of this program, the school formed a faculty advisory 
committee, and began an academic program in community health. The 
School of Public Health has also instituted a program in social 
mobilization to teach community leaders how to empower their 
communities for action.
   allied health professions advanced training and special projects 
                            [section 766-7]
    Section 766 authorizes the awarding of grants to schools, 
universities, and other educational entities for establishing and 
expanding post baccalaureate programs for the advanced training of 
allied health professionals, as well as for providing traineeships and 
fellowships for students who agree to teach in an allied health 
profession. Section 767 provides funding for developing or expanding 
programs that will increase the number of individuals trained in allied 
health professions. The fiscal year 1997 appropriation of $3.832 
million supported 34 special projects in allied health; the fiscal year 
1998 appropriation is $3.845 million.
    Several grant recipients have developed model programs to identify 
and recruit non- traditional students, including minorities and recent 
college graduates in science, into allied health professions. The 
University of Maryland School of Medicine developed a national model to 
assist in recruiting and retaining minority and disadvantaged students. 
The retention rate of individuals participating in the program is 92 
percent to 100 percent.
 health administration traineeships and special projects [section 771]
    Health administration training programs exist in a wide variety of 
settings, including medical schools, schools of allied health, schools 
of public health, and even in schools of business. They play an 
integral role in training the present and future management of our 
evolving health care system.
    Section 771 authorizes a program of traineeships, as well as 
special projects in which grant applications are peer-reviewed. Special 
emphasis is placed on programs that focus more heavily on underserved 
communities. Preference is given to students who are committed to 
careers in underserved areas with public or nonprofit private entities 
requiring the specific training provided in health administration 
programs. The fiscal year 1997 appropriation of $1.095 million 
supported 38 awards and 365 health administration trainees. The fiscal 
year 1998 appropriation is $1.099 million.
  geriatric education centers and fellowships and geriatric optometry 
                 training [sections 777 (a, b, and (c)]
    Funding for geriatric training has not kept pace with the rising 
demand for specialized services necessary for a rapidly aging 
population. Evaluations of the adequacy and availability of health- 
care personnel to meet the needs of elderly Americans through the year 
2020 have revealed a shortage of adequately-trained faculty to educate 
future health-care providers in geriatrics. Specifically, increased 
funding is needed to support multi-disciplinary geriatric education 
centers (GECs) and geriatric training programs (GTPs). Both types of 
programs are effective in providing opportunities for health-care 
personnel to develop skills for providing better, more cost-effective 
health care for older Americans.
    GECs include short-term faculty training, curriculum and other 
educational resource development, and technical assistance and 
outreach, and are affiliated with educational institutions, hospitals, 
nursing homes, community-based centers for the aged, and veterans' 
hospitals. GTPs provide fellowships for medical and dental faculty and 
provide for curriculum development, the hiring of faculty and the first 
three months of fellowship training.
    Section 777(c), Geriatric Optometry Training, authorizes grants to 
schools and colleges of optometry to support projects in postgraduate 
geriatric care training for optometrists who will teach geriatric 
optometry; to provide residencies, traineeships, and fellowships to 
participants; and to establish new affiliations with nursing homes, 
ambulatory-care and senior centers, and other public or nonprofit 
private entities.
    The fiscal year 1997 appropriation of $8.88 million supported 31 
GECs and 8 Faculty Fellowship Programs; the fiscal year 1998 
appropriation is $8.911 million.
    University of North Texas Health Science Center Texas College of 
Osteopathic Medicine (UNTHSC) has a two year faculty training program 
in medicine and dentistry that includes research, administration, 
clinical, and teaching experiences in aging. By July, 1997, the program 
will have graduated three dentists and 1 physician. The program 
requirements include providing services through community-based 
programs to minority elderly and indigent elderly populations. Over the 
past three years, a dentist, nurse manager, Director of nursing, 
physician, and administrative coordinator have enjoyed the benefits of 
a educational experience in geriatrics education. There are needs for 
continued support of GEC's to increase interdisciplinary training in 
Geriatrics to meet future population demands.
         rural health interdisciplinary training [section 778]
    Rural health interdisciplinary training projects are designed to 
assist individuals in academic institutions in establishing long-term 
collaborative relationships with health care facilities and providers 
in rural areas. Projects funded under this authority use new and 
innovative methods to train practitioners to provide services in rural 
areas, demonstrate models and methods designed to provide access to 
cost-effective comprehensive health care, and enhance the amount of 
relevant research conducted concerning health care issues in rural 
areas. Twenty grants and contracts were made with the fiscal year 1997 
appropriation of $4.153 million.; the fiscal year 1998 appropriation is 
$4.167 million.
               health professions research [section 781]
    Section 781 provides funding to public and nonprofit private 
educational entities for conducting research on various health 
professions issues. The issues on which research has been authorized 
include the extent to which educational indebtedness influences the 
specialty choice of medical students; the effects of federally-funded 
educational programs for minority and disadvantaged individuals; the 
effectiveness of state licensing authorities in protecting the public 
health through investigations and disciplinary actions; and the extent 
and impact of federal policies and medical school curricula on the 
percentage of physicians and other health professionals graduating from 
health professions schools and selecting a primary care career. The 
fiscal year 1995 appropriation of $600,000 supported 11 contracts and 
awards; there was no appropriation for fiscal year 1996. The fiscal 
year 1997 appropriation was $450,000; the fiscal year 1998 
appropriation is $452,000.
           chiropractic demonstration projects [section 782]
    Section 782 provides funding to chiropractic schools for carrying 
out demonstration projects in which chiropractors and physicians 
collaborate to identify and provide effective treatment for spinal and 
lower-back conditions. Funding may only be extended to a project in 
which a school of medicine or osteopathic medicine will participate 
jointly. The fiscal year 1997 appropriation was $1.025 million, which 
provided for three awards; the fiscal year 1998 appropriation is $1.029 
million.
             health professions data analysis [section 792]
    Section 792 authorizes the Secretary of Health and Human Services 
to establish a program to collect, compile, and analyze data on health 
professions personnel. The program includes a uniform health 
professions data reporting system. The Secretary also has the authority 
to conduct or enter into contracts with states and not-for-profit 
entities for the conduct of analytic and descriptive studies of the 
health professions, including evaluations and projects of the supply of 
and need for health professionals by specialty and geographic location. 
The fiscal year 1997 appropriation was $236,000, which supported 12 
contracts and awards; the fiscal year 1998 appropriation is $237,000.
                  title viii (the nurse education act)
    The Nurse Education Act helps schools of nursing and nursing 
students at all levels prepare a workforce for a changing health care 
delivery system. The NEA encourages moving the educational level of the 
professional nurse to the baccalaureate level (60 percent of RNs have 
less than a BSN today) due to the complexities of caring for sicker, 
often older, and chronically ill patients. The NEA is a major thrust 
toward educating more advanced practice nurses such as nurse 
practitioners (NPs), certified nurse midwives (CNMs), clinical nurse 
specialists (CNSs) and Certified Registered Nurse Anesthetists (CRNAs). 
The NEA also funds studies on workforce needs to help plan for the 
future.
    There is a preference in most Nurse Education Act programs for 
institutions that have been particularly effective in placing graduates 
in practice in medically underserved communities, such as rural areas 
and inner cities. The NEA appropriation for fiscal year 1998 was $65.6 
million
                     special projects [section 820]
    Section 820 provides funds to: increase nursing enrollments; 
initiate nurse managed centers to deliver primary care to medically 
underserved populations as part of a clinical training experience; 
support continuing education for nurses practicing in medically 
underserved communities; and to help paraprofessionals acquire 
professional nursing education. The fiscal year 1997 appropriation of 
$10.381 million funded 61 special projects; the fiscal year 1998 
appropriation is $10.600 million and should fund about the same number.
    An estimated 50 percent of the currently operating nurse managed 
centers were developed or expanded under this section. These clinics 
deliver essential primary health care services to a diverse population 
in elementary schools, senior citizens centers, housing complexes, 
homeless shelters and via mobile units such as the University of 
Maryland School of Nursing's Wellmobile. Section 820 also supports 
projects to increase the use of technology in nursing practice.
                 advanced nurse education [section 821]
    Section 821 represents program support for schools offering 
master's and doctoral programs for graduate students on track to become 
clinical nurse specialists, public health nurses, nursing school 
faculty, and acute care nurse practitioners (education for primary care 
nurse practitioners in supported by Section 822). Nearly 1,300 graduate 
students benefited from 60 grants totaling $12.249 million in fiscal 
year 1997; the fiscal year 1998 appropriation is $12.410 million and 
will fund about the same number of awards.
    A University of Pittsburgh School of Nursing project funded through 
this section combines education regarding the acute care skills of a 
clinical nurse specialist and primary care skills of an NP and recruits 
applicants from rural and underserved areas (26 out of 88 enrolled are 
from such places). This section supports 10 programs in psychiatric-
mental health nursing. The section supports 70 percent of doctoral 
programs preparing nursing faculty. (Funding for doctoral programs is 
limited to 10 percent of appropriations for this section.)
        nurse practitioner/certified nurse-midwife [section 822]
    Section 822 supports grants to schools for starting, maintaining, 
or expanding advanced practice programs educating primary care nurse 
practitioners and certified nurse-midwives. The section gives special 
consideration to programs that train NPs and CNMs for practice in 
Health Professional Shortage Areas. The fiscal year 1997 appropriation 
of $17.278 million supported 69 awards benefiting 1540 NPs and CNMs; 
the fiscal year 1998 appropriation of $17.64 million will result in 
about the same number of awards.
    This section funded 60 percent of nurse practitioner programs 
preparing for practice in primary care. Medicaid patients represent a 
quarter of the patient population for forty four percent of certified 
nurse practitioners. A majority of nurse-midwives have been educated in 
programs supported by this section, and 89 percent of nurse-midwives 
serve low-income women.
   opportunities for nursing students from disadvantaged backgrounds 
                             [section 827]
    Section 827 funds nursing school activities to recruit, counsel, 
remediate, and assist faculty in helping, disadvantaged students in 
completing nursing education programs. A small stipend is part of 50 
percent of awards. The fiscal year 1997 appropriation of $3.799 million 
aided 1,000 nursing students in 22 programs; the fiscal year 1998 
appropriation of $3.878 million will fund about the same.
    Schools receiving support from this section average 35 percent 
minority students, compared to schools not in the program at 19 
percent. Over the past 5 years, this section has helped increase 
overall minority nursing student enrollments by 25 percent. One program 
in rural North Carolina is part of an academic pipeline to facilitate 
disadvantaged students in attaining a BSN degree. Two Texas programs 
helped increase the clinical competence of disadvantaged students and 
boost their graduation rates. The NEA has supported 3 minority 
congresses to consider ways to increase the minority presence in 
nursing practice and teaching.
traineeships for the advanced education of professional nurses [section 
                                  830]
    Section 830 funds individual stipends for master's and doctoral 
students (funding for doctoral limited to 10 percent of total 
appropriations for the section) such as nurse practitioners, certified 
nurse midwives, nurse educators, public health nurses or in clinical 
nursing specialties, with a preference for those who are residents of 
Health Professional Shortage Areas. The graduate education of more than 
5,580 nurses at 267 schools was supported by the fiscal year 1997 
appropriation of $15.662 million; the fiscal year 1998 appropriation of 
$15.985 million will be distributed to students by 278 schools.
    This section provided stipends to about 37 percent of full time 
graduate nursing students, including 20 percent of funded nurse 
practitioner programs and 42 percent of nurse- midwifery programs. In 
some cases, these stipends make it possible for a student to attend 
school full time, producing these much sought after professionals more 
quickly. (Over half of master's in nursing students are part 
time.)(Funding for doctoral students is limited to 10 percent of the 
appropriations for this section.)
                    nurse anesthetists [section 831]
    Section 831 assists programs that teach registered nurses to become 
Certified Registered Nurse Anesthetists (CRNAs), with a concentration 
on meeting the needs of rural areas by requiring clinical experience 
there and by preferring residents of Health Professional Shortage 
Areas. The section provides grants for institutions to develop and 
operate programs, to improve faculty, and to offer traineeships to 
students. A fiscal year 1997 appropriation of $2.678 million benefited 
1,107 nurse anesthesia students (over 75 percent of total students) and 
66 programs; the fiscal year 1998 appropriation of $2.774 million will 
have about the same impact.
    CRNAs administer 65 percent of anesthetics administered each year 
and are sole providers in 70 percent of rural hospitals. This section 
also helped programs obtain training sites for students who are 
required to have a minimum of 800 hours of clinical training.
        loan repayment for service shortage areas [section 846]
    Section 846 repays up to 85 percent of nursing student loans in 
return for at least 2 years of practice in an area of nursing shortage, 
such as Indian health, public hospital, migrant, rural or community 
health center, or other public facility that has a critical shortage of 
nurses. In fiscal year 1997, 213 awards were made from an appropriation 
of $2.157 million. In fiscal year 1998, appropriations of $2.183 
million will produce about 200 new awards.
    Ninety percent of loan repayment participants are in pubic 
hospitals providing inpatient care. The three states with the highest 
number of loan repayment nurses are Louisiana, (74), Mississippi (18) 
and North Dakota (12). Other states with substantial numbers of nurses 
in loan repayment are Hawaii (7), Georgia (8), Alabama (6), Nebraska 
(12), South Carolina (8), and Texas (7).
    In closing, Titles VII and VIII of the Public Health Service Act 
help the nation meet the need for an expanded supply of primary health 
care providers and public health professionals. For both institutions 
and students, the educational process is a carefully planned and 
carried out undertaking that depends upon stability of financial 
support. Federal funds are a vital part of this effort because they 
focus on innovative approaches to changes in the health care delivery 
system and help to prepare those who deliver basic care to underserved 
people. The solution is to fund Titles VII and VIII in accordance with 
the need. In this rapidly changing health care environment, it is 
crucial Title VII and Title VIII programs receive an appropriation of 
at least $306 million for fiscal year 1998 to meet their missions.
    The members of HPNEC appreciate the opportunity to comment on these 
vital programs and look forward to working with the Subcommittee in 
support of them.
                                 ______
                                 
     Prepared Statement of Nancy Munro, RN, MN, CCRN, the American 
               Association of Critical Care Nurses [AACN]
    Thank you Chairman Specter and Members of the Subcommittee for the 
opportunity to present written testimony. I am Nancy Munro, Clinical 
Nurse Specialist at Georgetown University Hospital. I am pleased to 
present testimony on behalf of the American Association of Critical 
Care Nurses (AACN) in support of funding for the National Institute of 
Nursing Research, the Agency for Health Care Policy and Research, and 
the Title VIII Health Professions Programs.
    AACN is a not-for-profit service association dedicated to the 
welfare of people experiencing critical illness or injury. AACN was 
founded in 1969 and has grown to become the world's largest specialty 
nursing organization with nearly 73,000 members representing the United 
States and 35 countries. AACN has 270 chapters, located in every state 
and overseas.
    Our goal should be to translate the promise of scientific discovery 
into an improved quality of life for all Americans. To accomplish this, 
we must continue to invest in medical research and the NIH. Towards 
this end, I encourage the Subcommittee to support the recommendation of 
the Ad Hoc Group for Medical Research Funding which calls for a 15 
percent increase in the NIH budget for fiscal year 1999. This 
represents the first step towards doubling the NIH budget over the next 
five years. And within this increased appropriation, AACN will work to 
ensure that NINR receives its fair share of the increase.
    AACN strongly supports NINR's goals of health care effectiveness, 
cost effectiveness, and assuring that the scientific agenda has a human 
aspect and translates research findings into applications that improve 
the nation's health.
    As nurses who provide care to the critically ill, one of the most 
important things we can do for our patients is provide relief from 
their pain and suffering. Nursing affords a unique vantage point from 
which to examine the way pain affects patients and their caregivers. 
Pain is also a costly health problem, prompting nearly 40 million 
visits to health care providers each year and costing our nation over 
$100 billion annually in lost productivity and health care expenses.
    Over the past year, NINR has reported two groundbreaking advances 
in pain research--one showing gender differences in response to 
analgesics and a second indicating that sedatives given before surgery 
can actually block the action of medication given to relieve pain after 
surgery.
    AACN currently sponsors Thunder Project II, a large-sample, multi-
site research project in partnership with seven other nursing 
organizations. The purpose of the research is to examine pain 
perceptions and responses of acutely or critically ill pediatric and 
adult patients to selected producers. Data collection is underway, and 
it is anticipated that it will be completed by early 1999. To date, 
over 200 sites are enrolled in the U.S., Canada, Australia, and the 
U.K.
    AACN also supports NINR's leadership in improving end-of-life-care. 
NINR recently held a state-of-the-science conference on ``Symptoms in 
Terminal Illness'' to address end-of-life issues in four areas--pain, 
dyspnea, cognitive disturbances, and cachexia.
    AACN firmly believes that research is needed to develop a 
scientific basis for critical care nursing practice and to achieve a 
broad understanding of the role and impact of critical care nurses on 
patient outcomes. Many research projects funded by AHCPR are gradually 
helping our communities refocus healthcare so that it is truly driven 
by the needs of patients and their families. AACN is pleased that the 
President's budget includes $171 million for AHCPR, a $25 million 
increase over fiscal year 1998.
    As you know, in 1990, Congress passed the Patient Self 
Determination Act which AACN believes has made significant progress in 
educating Americans about their right to make their own health care 
choices. This is of particular interest to AACN in light of the Robert 
Wood Johnson study that followed 9,000 critically ill patients and 
found discrepancies between patient's end-of-life care directions and 
their actual treatment.
    AACN is currently working to educate consumers about the Patient 
Self Determination Act and its importance. The Committee's support for 
AHCPR has provided AACN with the resources to design a community 
outreach program to improve completion rates for advanced directives. 
AACN's program, in conjunction with UCSF, Research on Advance Care 
Planning Including Advanced Directives, has a specific emphasis on an 
education program stressing definition and documentation of care 
preferences so that in the event of catastrophic illness or injury, 
individual care preferences can be honored.
    Additional funds have been received to complete the project as a 
result of AHCPR funding in fiscal year 1998.
    AACN believes that education is fundamental to professional growth 
and to excellence in clinical practice and optimal patient outcomes. 
Practitioners must commit to life-long learning to assure they remain 
competent in fulfilling their obligations to the patients and families 
they serve.
    According to the Bureau of Labor Statistics, the demand for health 
professionals is expected to grow by 47 percent by the year 2005, with 
the need for advanced practice registered nurses among the greatest. In 
addition, an Institute of Medicine study on the role of nursing staff 
in hospitals found that a more advanced, or more broadly trained 
registered nurse (RN) workforce would be needed in the future. Such 
training is currently provided under the programs funded under Title 
VIII of the Public Health Service.
    AACN is pleased that Congress provided an increase for Health 
Professions training overall in fiscal year 1998, and encourages 
Congress to once again demonstrate its support for these important 
programs in fiscal year 1999.
    In closing, Mr. Chairman and members of the Subcommittee, I would 
like to thank you again for your support for nursing research and the 
NIH.
                                 ______
                                 
   Prepared Statement of Ellen Glesby Cohen, President and Founder, 
                Lymphoma Research Foundation of America
    Thank you Chairman Specter and esteemed members of the Subcommittee 
for the opportunity to present written testimony before the 
Subcommittee. My name is Ellen Glesby Cohen. Even in my wildest dreams, 
I never thought that I would be in this honored position of testifying 
before Congress on matters of life and death. That was before my own 
health turned into a matter of life and death and made me realize how 
many millions of Americans will be helped or even healed by the 
decisions you have the power to make.
    I am here today as the Founder and President of the Lymphoma 
Research Foundation of America, the nation's largest lymphoma 
organization dedicated to providing comprehensive information and 
support to lymphoma patients, their family and friends. The Lymphoma 
Research Foundation of America also finances research into better and 
safer treatments for the third most rapidly-rising cancer in America. I 
would like to share with you the story of my own battle with Lymphoma 
as a way of illustrating for you just how crucial your work is. 
Although this disease claims the lives of more victims every day and 
understanding lymphoma could shed light on many other diseases, funding 
for lymphoma research amounts to just 2 percent of the National Cancer 
Institutes' budget.
    I am going to speak from my heart today so that you know how much 
we are looking to this Subcommittee for the hope and strength we need 
to persevere in our battle against this killer called lymphoma.
    In 1987, my dear husband, Mitch, and I were the proud parents of an 
18-month-old daughter and we were waiting for our son to be born. We 
were also building an addition to our home. My husband's internal 
medicine practice was growing and I was a busy TV commercial producer.
    Life was good except for the nagging tiredness I was constantly 
feeling. It also seemed that I got the flu or a cold every time I 
turned around. The lymph nodes in my neck kept swelling up and my feet 
were so swollen that I had to buy new shoes. I went to the doctor, but 
blood tests didn't reveal anything suspicious.
    My son, Joshua, was born in October of 1988. When I didn't bounce 
back from the birth, and lumps kept growing on my neck, my husband sent 
me to an oncologist. She took one look at me and sent me straight to 
the hospital for a biopsy. A week later, we had an answer, but it 
wasn't the answer we wanted to hear.
    I had Lymphoma. Cancer of the lymph system. And it isn't curable. 
At the time, I wasn't even 40 years old.
    My doctors told me to go on with my life. Sure, I was sick, they 
said, but not sick enough to receive aggressive treatment at the time. 
But how do you act like nothing is happening to your family when cancer 
is lurking in your body?
    Somehow, we made it through a year and a half. Eventually, I 
developed a 99-percent obstruction in my nasal pharynx and I could 
hardly breathe. I also had a large mass in my abdomen. It came time for 
me to experience chemotherapy and within days of that first treatment, 
I was back in the hospital with a collapsed immune system. I had just 
five white blood cells left in my body. I didn't even have the strength 
to hug my children. Eventually, the therapy did its job. But it wasn't 
medicine that gave me the will to fight. It was the statistics behind 
this devastating illness.
    Lymphoid malignancies strike upwards of 85,000 Americans each year 
and there is a 50-percent mortality rate. It is one of the most rapidly 
rising cancers in our country today yet it seemed that no one knew much 
about it. Even the scientific community was not sure what caused it and 
there was no national organization funding research, educating the 
public or supporting patients.
    I had to do something. So I picked up the telephone and began 
calling everyone I could think of. Each phone call led me to someone 
else--another doctor, another lymphoma patient. Those conversations 
convinced me that I could start a nonprofit organization that could 
make a difference, not just for myself but for the health of all 
Americans.
    You see, this disease knows no boundaries. Anyone can get it. A 
former First Lady. A former senator. A professional hockey player. Two 
of my neighbors. Even voters who cast their ballots for the esteemed 
members of this subcommittee. You should be aware that many of the 
states you represent have some of the highest rates of lymphoma in the 
country. Approximately 600,000 Americans today are living lymphoid 
malignancies. Some days, it feels like I hear from all of them. I have 
to fight back the tears when I hear from a 23-year-old graduate student 
in Illinois who tells me she is relapsing after only a year of 
remission and she's running out of effective and safe treatment 
options.
    I started the Lymphoma Research Foundation of America to raise 
money, but what's priceless is the hope we have raised. We started the 
first Lymphoma-specific support groups, Internet site, patient helpline 
and quarterly newsletter. To date, the Lymphoma Research Foundation of 
America has funded 43 Lymphoma research projects totaling more than 
$1.25 million at top cancer centers and universities across the 
country.
    Lymphoma is a growing, serious public health problem for all 
Americans. Recent research shows that there are links between 
understanding the causes of lymphoma and understanding the causes of 
many other cancers, including leukemia, lung, colon, breast and 
prostate cancer. We are finding that there are several crucial 
scientific issues that require immediate attention, such as the link 
between viruses and bacteria with lymphoma, and the role of 
environmental toxins in triggering lymphomas.
    The Lymphoma Research Foundation of America has achieved a lot, but 
this disease is a formidable opponent and strikes in the very prime of 
our lives. Of all cancers, lymphoma is the fourth-largest killer of men 
ages 25 to 60 and the fifth-largest killer of women in that same age 
group. Sixty percent of all childhood malignancies are lymphoma or 
related diseases.
    Those statistics grow deadlier every day. I, myself, am now facing 
the grim prospect of another round of chemotherapy and I wonder how 
much more my body can endure. I keep reminding myself--and every 
Foundation member I speak with--that some of the new treatments that 
have come out of our research programs are promising. But it's so hard 
to keep hope alive without increased government support.
    The good news is that scientists believe that lymphoma research 
will unlock the secrets to many other cancers. That is why, for Fiscal 
1999, Mr. Chairman, we seek this Subcommittee's continued support in 
funding the research essential to finding a treatment and cure for 
lymphoma. In furtherance of this goal, we request that Congress: 
Increase Appropriations for the National Institutes of Health.
    Lymphoma Research Foundation of America endorses the call of the Ad 
Hoc Group for Medical Research Funding for a doubling of the budget of 
the National Institutes of Health within the next five years.
    However, we realize the difficulty--if not impossibility--of 
achieving this goal entirely with the current spending caps for 
discretionary spending. Accordingly, we believe that the Administration 
and Congress should identify additional resources to reach these goals, 
such as adjustments to spending caps, increasing tobacco revenues, and 
investing part of the potential budget surplus.
    As a first step the Lymphoma Research Foundation of America joins 
the Ad Hoc Group, along with other research organizations, in 
supporting a 15 percent increase for the NIH in Fiscal 1999.
    For the National Cancer Institute, which funds the bulk of lymphoma 
research at the NIH, Lymphoma Research Foundation of America supports 
the Institute's Fiscal 1999 Bypass Budget Request of $3.191 billion, 
which represents a $644 million increase over the Fiscal 1998 
appropriated level. The 1999 Bypass Budget will enable the National 
Cancer Institute to sustain its current research investment, identify 
and invest in new research opportunities, and invest now in future 
research opportunities.
    For all the reasons mentioned above, its link with other cancers, 
the potential role of environmental factors, and the alarming rise in 
its incidence, the Lymphoma Research Foundation of America requests 
that the Subcommittee include in its Fiscal 1999 Committee Report 
language calling for:
  --Increased appropriations for lymphoma research.
  --Use of all available mechanisms for expanding the scope of lymphoma 
        research, including convening a scientific workshop to examine 
        the current state of research on lymphoma and exploring 
        opportunities for additional study, use of program 
        announcements and Requests for Applications on lymphoma-
        specific research topics.
  --Research into potential environmental and other factors responsible 
        for lymphoma.
    Thank you for the opportunity to tell you my story. Thank you for 
your hard work and for your consideration. And thank you for the hope 
that you have given me and to all lymphoma patients and their families.
                                 ______
                                 
Prepared Statement of Michael Q. Ford, Executive Director, the National 
                     Nutritional Foods Association
    Mr. Chairman and members of the subcommittee: My name is Michael 
Ford. I am Executive Director of the National Nutritional Foods 
Association (NNFA), a trade association representing some 2,500 health 
food stores and some 800 manufacturers, distributors and suppliers of 
natural health products, including organic and natural foods, natural 
ingredient cosmetics and dietary supplements.
Congressional mandate mirrors citizen demand
    National interest in access to and reliable information on safe, 
effective vitamins, minerals, herbs, amino acids and other dietary 
supplements has grown steadily since the Dietary Supplement Health and 
Education Act (DSHEA) unanimously passed the House and Senate to become 
the law of the land in 1994.
    Approximately 100,000,000 Americans are taking dietary supplements, 
spending, by some estimates, as much as $11.5 billion a year in health 
food stores alone. Americans are looking to safe, natural alternatives 
to prescription drugs to treat and prevent disease, and to maintain 
good health by supplementing inadequate diets with vitamins and 
minerals.
Nutrients can prevent chronic disease
    We are entering a new era of recognition of the value of natural 
pathways to good health. For example, the Food and Nutrition Board of 
the National Academy of Sciences, which devises Recommended Daily 
Allowances for nutrients for the Food and Drug Administration, has 
issued the first of a series of reports presenting revised nutrient 
intake guidelines. Originally introduced in 1941, RDAs were intended to 
prevent classical nutrient deficiency diseases nearly extinct in the 
U.S. today, such as scurvy, beriberi and rickets. Now, these reports 
are revising and expanding RDAs to reflect compelling evidence which 
supports the use of nutrients to help prevent chronic disease, such as 
osteoporosis. We agree with the Chairman of the Food and Nutrition 
Board, who characterized this approach as ``a major leap forward in 
nutrition science.''
    Similarly, the recent report of the President's Commission on 
Dietary Supplement Labels endorses continued research on the benefits 
of dietary supplements in health promotion and disease prevention. The 
Commission hails the increasing research-based documentation of the 
benefits of dietary supplements in maintaining health and preventing 
chronic disease and other health-related conditions, and calls for 
continuation of this welcome trend. NNFA entirely supports the 
Commission's recommendation that, ``the public interest would be served 
by more research that assesses the relationships between dietary 
supplements and maintenance of health and/or prevention of disease.''
Herbs and botanicals are beneficial, cost-effective
    In addition to support for these kinds of exciting new findings on 
the health benefits of nutrients, NNFA urges the Committee to support 
research on medicinal herbs and botanicals, also classified as dietary 
supplements under the DSHEA. The results of a study on ginkgo biloba, 
published recently in the October 22, 1997, ``Journal of the American 
Medical Association,'' indicates that administration of this herbal 
extract, recognized for centuries in Chinese medicine for its ability 
to stimulate and improve blood circulation in the brain, could delay 
the onset of Alzheimer's Disease for up to 6 months. This could 
represent tremendous savings of lives and dollars from a disease which 
costs society $90 billion a year. Other studies show saw palmetto more 
effective than prescription medicine at reducing benign prostate 
enlargement, with far less expense and no reportable side effects.
    Millions of Americans are turning daily to herbal remedies and 
seeking primary health care from the alternative, holistic providers 
who prescribe them. There is an urgent need for a dramatic increase in 
support for research on herbs and botanicals, justified by consumer 
demand and the Congressional intent expressed in DSHEA. The Dietary 
Supplement Commission report recommends that, ``Federal agencies 
continue to support research on the health benefits and safety of 
dietary supplements. Research should be expanded beyond the 
traditionally supported areas associated with vitamin and mineral 
supplements and include research on some of the more promising 
botanical products used as dietary supplements.'' NNFA whole-heartedly 
agrees.
    Ours is one of the few cultures in the world for whom the 
prevention and treatment of disease with non-prescription herbal 
medicines is the exception rather than the rule. This is largely due to 
the fact that foreign research oftentimes is deemed unacceptable by the 
Food and Drug Administration for use in justifying health claims for 
herbs and botanicals. We urge the Committee to provide the adequate 
funding for research on the safety and benefits of medicinal herbs.
Full funding for the NIH Office of Dietary Supplements
    The Office of Dietary Supplements (ODS) was established at the 
National Institutes of Health by DSHEA, to stimulate, coordinate and 
disseminate the results of research on the benefits and safety of 
dietary supplements in the treatment and prevention of chronic disease. 
Though authorized at $5 million per year by DSHEA to carry out its 
lofty mission, ODS has been woefully underfunded at less than $1 
million per year and fewer than 2 full-time employees (FTEs). Despite 
these severe financial constraints, ODS has done an admirable job in 
attempting to meet its mandate. While this is commendable, the 
Congressional mandate for ODS is yet unmet. NNFA agrees with the 
President's Commission on Dietary Supplement Labels that the ODS must 
be fully-funded. Says the Commission report, if fully-funded, ``ODS 
could play a valuable role in providing consumers with information 
about dietary supplements including [the] promotion of scientific 
studies on potential roles of dietary supplements in health promotion 
and disease prevention. Appropriations as authorized by DSHEA are 
essential if ODS is to meet [the] mandates of the Act.'' ODS deserves 
this Committee's support and that of the NIH itself.
Office of Complimentary and Alternative Medicine
    In 1992, Congress directed the National Institutes of Health to 
establish the Office of Alternative Medicine with the expressed task of 
assuring objective, rigorous review of alternative therapies to provide 
consumers reliable information. While funding for the Office has grown 
since its creation, the fiscal year 1998 funding of $20 million 
provided for this office, now known as the Office of Complimentary and 
Alternative Medicine (OCAM), is an infinitesimal percentage of the 
overall NIH budget. Furthermore, the OCAM budget is insignificant in 
comparison to the dramatic growth of the American public's interest in 
and use of alternative therapies.
    Indeed, findings from the ``National Survey of Alternative Medicine 
Use,'' published in the January, 1993 New England Journal of Medicine, 
reveal that Americans made an estimated 425 million visits to 
alternative medical therapy providers in 1990, exceeding the 338 
million visits made to all US primary care providers that year. The 
survey also showed that out-of-pocket expenditures associated with 
alternative therapies totaled $10.3 billion in 1990, approaching the 
$12.8 billion in out-of-pocket expenses incurred for all U.S. 
hospitalizations during the same period.
    NNFA not only supports increased funding for OCAM, but feels it is 
critical that this office also be granted increased authority to 
initiate research projects and develop its own peer review panels. To 
this end, the NNFA strongly supports legislation to elevate the Office 
of Complimentary and Alternative Medicine to a Center at the National 
Institutes of Health, as proposed by Congressman Peter DeFazio's H.R. 
1055, the National Center for Integral Medicine Establishment Act.
Demonstration projects at AHCPR and HFCA
    The Agency for Health Care Policy and Research (AHCPR) is often 
directed by the Committee to pursue projects designed to research the 
cost-effectiveness attendant to novel approaches to the treatment and/
or prevention of illness. The time is right for investigation of the 
worthiness of certain dietary supplements, based on well-designed, 
cost-effectiveness research.
    Every year, treatment of chronic conditions and illnesses--from 
flus and colds to hypertension to dementia and Alzheimer's disease--
generates enormous publicly and privately funded health care 
expenditures. There exists an opportunity to trim such burgeoning costs 
through prevention and/or treatment of these chronic ailments--or delay 
of their onset--with safe, effective, low cost dietary supplements. 
NNFA is confident that basic research at NIH can lead to appropriately 
structured, cost/outcome research at AHCPR which would demonstrate the 
value of dietary supplements in comparison to contemporary medical 
intervention. This evidence can, in turn, lead to HCFA projects to 
determine if a policy of reimbursement could be established.
    Despite the growing popularity and demand for herbs and nutritional 
supplements, and their widespread use for prevention and intervention 
of chronic illness, precious few large-scale outcome studies on 
American populations are available to give health professionals the 
information they need to make decisions on alternatives to contemporary 
medical approaches. Echinacea and golden seal have been shown to be 
effective in preventing and treating colds and flus; ginkgo has been 
show to forestall dementia and the onset of Alzheimer's disease; 
herbal/nutritional combinations have been shown to provide control for 
hypertension without the side effects which cause many patients to stop 
using their prescription medicine; similarly, saw palmetto effectively 
shrinks benign prostate enlargement without side effects affecting 
normal body function.
    NNFA believes that a sufficient body of botanical and nutrient 
research may exist in certain instances, to whet AHCPR's appetite and 
to warrant Congressional consideration of cost-effectiveness studies in 
this area.
    NNFA urges the Committee to consider directing AHCPR to work with 
the Office of Dietary Supplements and the Office of Complimentary and 
Alternative Medicine to review the existing outcome research on dietary 
supplements. The AHCPR could then investigate the feasibility, under 
appropriate protocols, of developing cost-effectiveness projects 
designed to compare the value of herbs and other dietary supplements in 
the treatment and prevention of chronic illness to typical medical 
approaches. The areas I have mentioned are but a few of the many 
possibilities which urgently present themselves for research and 
evaluation. Once the necessary biomedical and cost-effectiveness 
research have been completed, NNFA urges the Committee to direct HCFA 
to investigate the potential reimbursement for promising alternative 
therapies and treatments involving nutritional supplements and herbs.
A sound investment in the health and well-being of all Americans
    Science and experience ably demonstrate a wealth of benefits 
attendant to the regular use of vitamins, minerals, amino acids, 
enzymes, herbs and botanicals--all classified by DSHEA as dietary 
supplements. Dietary supplements are allowing millions of American 
consumers to take charge of their own good health by safely and 
effectively preventing and treating a host of illnesses and conditions. 
The body of research supporting use of these products is impressive, 
but sorely requires immediate and dramatic expansion. NNFA urges the 
Committee to undergird the Congressional mandate expressed in DSHEA by 
investing in the scientific research which holds the key to our 
knowledge of the remarkable importance and value of dietary 
supplements.
    Thank you.
                                 ______
                                 
               Prepared Statement of Rotary International
    Chairman Specter, members of the subcommittee: Rotary International 
appreciates this opportunity to submit written testimony in support of 
the polio eradication activities of the U.S. Centers for Disease 
Control and Prevention. Rotary International is a global association of 
nearly 29,000 Rotary clubs, with a membership of over 1.2 million 
business and professional leaders in 158 countries. In the United 
States today there are some 7,500 Rotary clubs with over 400,000 
members. All of our clubs work to promote humanitarian service, high 
ethical standards in all vocations, and international understanding.
    Rotary is submitting this testimony on behalf of a broad coalition 
of child health advocates, including the March of Dimes Birth Defects 
Foundation, the American Academy of Pediatrics, the Task Force for 
Child Survival and Development, and the U.S. Committee for UNICEF, to 
seek your continued support for the global program to eradicate polio. 
First, Rotary International and our coalition would like to express our 
sincere gratitude. For 1997, you recommended that $47.2 million be 
allocated for the polio eradication activities of the Centers for 
Disease Control, and for fiscal year 1998 you again recommended this 
same amount, and the full Congress ratified your recommendations in 
both years.
    This investment makes the United States the leader among donor 
nations in the drive to eradicate this crippling disease. The target 
year is 2000. Fewer than 1,000 days remain to defeat this disease in 
the 60 nations where the polio virus still causes death and disability. 
The eradication of polio, achieved through your leadership, will not 
only save lives, but will also save our financial resources.
Eradicating polio will save the United States at least $230 million 
        annually
    Although polio-free since 1979, the United States currently spends 
at least $230 million annually to protect its newborns against the 
threat of importation of the polio virus. Globally, over 1.5 billion 
U.S. dollars are spent annually to immunize children against polio. 
This figure does not even include the cost of treatment and 
rehabilitation of polio victims, nor the immeasurable toll in human 
suffering which polio exacts from its victims and their families. Once 
polio is eradicated, tremendous resources will be unfettered to focus 
on other health priorities.
Progress in the global program to eradicate polio
    Thanks to your appropriations, the international effort to 
eradicate polio has made tremendous progress during the past two years.
  --Preliminary estimates are that reported polio cases for 1997 will 
        be approximately 3,600, one-half the number of cases reported 
        only 2 years ago. This dramatic decline is due to the 
        tremendous success of National Immunization Days (NIDs) in 
        South Asia and Africa. Worldwide, reported cases have decreased 
        from over 38,000 cases in 1985, when Rotary began its PolioPlus 
        Program--a decline of over ninety percent! Acute Flaccid 
        Paralysis (AFP) surveillance, which is critical to the process 
        of certification of a polio-free world, is improving, and 
        health authorities in polio-endemic countries are now better 
        able to assess the challenges remaining to eradication.
  --In 1996, 154 countries reported no polio. That number is expected 
        to rise in 1997. About 60 countries, however, remain polio-
        endemic.
  --The global eradication strategy is working. Seventy-five countries 
        conducted NIDs in 1997, protecting 450 million children against 
        polio--more than one-half of the world's children under the age 
        of 5.
  --During its third year of NIDs, India was able to immunize 130 
        million children on December 7, 1997, and again on January 18, 
        1998--the largest public health events in history. Pakistan, 
        Bangladesh, and six other countries coordinated their NIDs with 
        India's to achieve the maximum effect over the entire region.
  --Despite economic difficulties, more than 40 African countries 
        conducted National or Sub-National Immunization Days during 
        1996-97, as part of the continent-wide ``Kick Polio Out of 
        Africa'' campaign championed by South African President Nelson 
        Mandela, reaching nearly 70 million children. Forty-nine 
        African countries are undertaking NIDs in 1997-98. Polio-free 
        zones are emerging in both Northern and Southern Africa.
  --The three-year ``Operation MECACAR'' (Middle East, Caucasus, 
        Central Asian Republics) immunization campaign has been deemed 
        a success, virtually eliminating polio from 19 contiguous 
        countries stretching from the Middle East to Russia. For 1997, 
        polio cases reported from WHO's European region have been 
        confined to Tadjikistan and Turkey.
  --As a result of 3 years of successful NIDs, China reported no 
        laboratory-confirmed indigenous polio cases in 1996 or 1997. In 
        1997, reported polio cases in the Western Pacific were confined 
        to the Mekong Delta of Cambodia and Viet Nam, with no cases 
        reported for more than a year. We are optimistic that we have 
        seen the last case of polio in the Western Pacific, but 
        continued vigilance is necessary to confirm this. The entire 
        region has started on the process of certifying polio 
        eradication.
The role of the U.S. Centers for Disease Control and Prevention
    In this Subcommittee's fiscal year 1998 report, you commended the 
CDC for its active leadership in the global polio eradication effort, 
and recognized the real prospect of eradicating polio by the year 2000. 
As a result of the $47.2 million Congressional appropriation, in 1998 
the CDC is:
  --Supporting the international assignment of nearly 50 long-term 
        epidemiologists, virologists, and technical officers to assist 
        the World Health Organization and polio-endemic countries to 
        implement polio eradication strategies.
  --Providing $30 million to UNICEF for polio vaccine and operational 
        costs for NIDs in more than 50 countries in Asia, Eastern 
        Europe, the Middle East and Africa. Many of these NIDs would 
        not take place without the assurance of CDC's support.
  --Providing over $7 million to WHO for surveillance and NIDs' 
        operational costs, primarily in Africa. As successful NIDs take 
        place, surveillance is emerging as a critical need, to 
        determine where polio cases are continuing to occur. Good 
        surveillance can save resources by eliminating the need for 
        extensive immunization campaigns if it is determined that polio 
        circulation is limited to a specific locale.
  --Training virologists from all over the world in advanced poliovirus 
        research. The CDC's Atlanta laboratories serve as an 
        international reference center and training facility.
  --Helping to persuade countries such as Afghanistan, Somalia and 
        Sudan to plan and conduct NIDs despite ongoing civil conflict. 
        Warring factions have agreed to ``days of tranquillity'' in 
        order to allow immunization campaigns to occur.
The benefits of polio eradication
    Increased political and financial support for childhood 
immunization has many documented long-term benefits. Polio eradication 
is helping countries to develop public health and disease surveillance 
systems useful in the control of other vaccine-preventable infectious 
diseases. Already, much of Latin America is free of measles, due in 
part to improvements in the public health infrastructure implemented 
during the war on polio. As a result of this success, measles has been 
targeted for eradication in the Americas by the year 2000. The disease 
surveillance system--the network of laboratories, computers and trained 
personnel built up during the Polio Eradication Initiative--is now 
being used to track measles, Chagas, neonatal tetanus, and other deadly 
infectious diseases. The campaign to eliminate polio from communities 
has led to increased public awareness of the benefits of immunization, 
creating a ``culture of immunization'' and resulting in increased usage 
of primary health care and higher immunization rates for other 
vaccines. It has improved public health communications and taught 
nations important lessons about vaccine storage and distribution, and 
the logistics of organizing nation-wide health programs. Lastly, the 
unprecedented cooperation between the public and private sectors serves 
as a model for other public health initiatives.
Resources needed to finish the job of polio eradication
    The World Health Organization now estimates that in 1998 
approximately $220 million in external funds is needed to help polio-
endemic countries carry out the polio eradication strategy. For 1999, 
an estimated $248 will be needed. To date, however, only $160 million 
has been committed by external donors for 1998, leaving an estimated 
shortfall of $60 million. In the Americas, some 80 percent of the cost 
of polio eradication efforts were borne by the national governments 
themselves. In Africa, many nations can contribute only a small 
percentage of the needed funds, meaning that foreign donors must meet 
up to 100 percent of the polio eradication costs. We are asking that 
the United States continue to take the leadership role in meeting this 
shortfall.
    The United States' commitment to polio eradication has stimulated 
other countries to increase their support. Belgium, Canada, Finland, 
France, Italy, Korea, Norway, Sweden and Switzerland are among those 
countries which have followed America's lead and have recently 
announced special grants for the global Polio Eradication Initiative. 
Japan and Australia are major donors in Asia and the Western Pacific, 
and Japan has recently expanded its support to polio eradication 
efforts in Africa. And both Denmark and the United Kingdom have made 
major grants that will help ensure that India is able to vanquish polio 
by the target year 2000.
    By the time polio is certified as eradicated, hopefully no later 
than 2005, Rotary International will have expended well over $400 
million on the effort--the largest private contribution to a public 
health initiative ever. Of this, $304 million has already been 
allocated for polio vaccine, operational costs, laboratory 
surveillance, cold chain, training and social mobilization in 119 
countries. In 1997, realizing the increased role which external donors 
need to play in order to ensure that polio eradication is not 
jeopardized due to lack of resources, The Rotary Foundation committed 
an additional $34 million to its PolioPlus fund. More importantly, we 
have mobilized tens of thousands of Rotarians to work together with 
their national ministries of health, UNICEF and WHO, and with health 
providers at the grassroots level in thousands of communities.
Fiscal year 1999 budget request
    For fiscal year 1999, we respectfully request that you provide 
$67.2 million for the targeted polio eradication efforts of the Centers 
for Disease Control and Prevention. This is an increase of $20 million 
over the fiscal year 1998 level of $47.2 million, and $20 million more 
than the President's fiscal year 1999 budget request, which was 
submitted before WHO released the latest estimates of unmet polio 
eradication needs. The additional $20 million is needed to meet the 
enormous costs of eradicating polio in its final stronghold--sub-
Saharan Africa. Of this amount, $6 million would be used to purchase 
and deliver more oral polio vaccine for NIDs, while $5 million would be 
used for technical and operational support of NIDs in difficult 
countries such as Liberia, Somalia, and the Democratic Republic of the 
Congo. A further $9 million would go to develop an Africa-wide polio 
surveillance system, and strengthen and expand the existing network of 
regional and national laboratories. Without this additional 
appropriation, we may not be able to eradicate polio in Africa by the 
target date.
    Humankind is on the threshold of victory against polio, and we must 
not miss this window of opportunity. Poliomyelitis will be the second 
major disease in history to be eradicated. The world celebrated the 
eradication of smallpox in 1979, and no child anywhere in the world 
will ever suffer from smallpox again. The annual global savings of 
nearly $1 billion per year in smallpox immunization and control costs 
far exceed the approximately $300 million that was spent over ten years 
to eradicate the disease. The United States was a major force behind 
the successful eradication of the smallpox virus, and has recouped its 
entire investment in smallpox eradication every 2\1/2\ months since 
1971. Even greater benefits will result from the eradication of polio.
    Polio eradication is an investment, but few investments are as 
risk-free or can guarantee such an immense return. The world will begin 
to ``break even'' on its investment in polio eradication only 2 years 
after the virus has been vanquished. The financial and humanitarian 
benefits of polio eradication will accrue forever. This will be our 
gift to the children of the 21st century.
    Thank you for this opportunity to testify.
                                 ______
                                 
     Prepared Statement of Robert Wilson, the Wilson Foundation on 
                           Neurofibromatosis
    Thank you, Chairman Specter and members of the Subcommittee for the 
opportunity to submit testimony on the need for a continued Federal 
commitment to research for Neurofibromatosis (NF), a terrible genetic 
disorder closely linked to cancer, brain tumors and learning 
disabilities affecting over 100 million Americans.
    I am Robert Wilson, President of the Wilson Foundation, a private 
charitable foundation. My 11 year old son, Michael, suffers from a 
severe case of Neurofibromatosis. I have been working for many years 
with NF groups from around the country, the growing NF scientific 
community, members of Congress, and the National Institutes of Health. 
I appear before you today on behalf of Michael and the 100,000 other 
Americans who suffer from NF, as well as the tens of millions who 
suffer from NF's related diseases.
    As a result of your support for biomedical research, each year that 
I appear before your Subcommittee I bring exciting news of a 
breakthrough in NF research that moves us closer to a treatment and 
cure for this terrible disease. Once again, I am able to report to you 
a major breakthrough since last year which holds promise not only for 
the individuals suffering from NF, but also for the 100 million 
Americans who suffer from cancer, brain tumors, and learning 
disabilities with which NF is closely connected.
    Last Spring, researchers at Cold Spring Harbor Laboratory and 
Massachusetts General Hospital in Boston have determined for the first 
time that the NF-1 gene in fruit flies is linked to learning and 
memory. The studies showed that the protein made by the NF-1 gene is 
part of the c-AMP pathway, the pathway which is known to control 
learning and memory, while at the same time still being implicated with 
NF's cancer fighting tumor suppressor functions. This major 
breakthrough leads to new opportunities for drug and genetic therapies 
for NF patients, experiments for which have already begun on the fruit 
fly. Cold Spring Harbor Laboratory stated in its Spring/Summer 1997 
newsletter that such research stands to benefit ``a vast segment of the 
human population, including those afflicted with learning disabilities, 
Alzheimer's disease, and other dementias''.
    NF, incorrectly but commonly known as elephant man disease, 
involves the uncontrolled growth of tumors along the nervous system 
which can result in terrible disfigurement, deformity, deafness, 
blindness, brain tumors, cancer, and death. It is the most common 
neurological disorder caused by a single gene. While not all NF 
patients suffer from the most severe symptoms, all live their lives 
with the uncertainty of knowing whether they too will be severely 
affected because NF is a highly variable and progressive disorder.
    Dr. Samuel Broder, former Director of the National Cancer 
Institute, stated that NF was at the ``cutting edge'' of cancer 
research. This cancer connection was at the heart of two major 
conferences on NF held in October 1995 and July 1997 at Cold Spring 
Harbor Laboratory in New York, one of the world's leading cancer and 
neuroscience research laboratories headed by Dr. James Watson, the co-
discoverer of DNA. These Conferences brought together basic 
researchers, clinicians, biotech and pharmaceutical companies from 
around the world to find a treatment and a cure for NF. These 
conferences have been hailed throughout the research community as a 
turning point for NF. After the first conference, more than 20 leading 
NF researchers worked for over one year preparing a detailed blueprint 
for finding a treatment for NF. This document has been well received at 
NIH and many researchers are calling for this document to be used as a 
model for how NIH should fund research.
    The future promise of NF research is based upon past successes. Let 
me highlight the enormous advances in NF research that have occurred 
since 1990:
  --The discovery of the NF1 and NF2 genes and gene products;
  --Determining that NF is closely linked to many of the most common 
        forms of human cancer, brain tumors, and learning disabilities 
        which affect over 100 million Americans;
  --Determining the function of the NF genes and gene products, 
        including their tumor suppressor, memory, and learning 
        disability functions;
  --Developing animal models for NF1 and NF2;
  --Developing a diagnostic blood test and pre-natal testing for NF;
  --Commencing a national trial drug treatment program for NF patients 
        which can serve as the infrastructure for future clinical 
        trials;
  --Determining the connection between the phenotype /genotype in NF; 
        Substantially increasing the number of NF researchers;
  --Commencement of drug and genetic treatment experimentation on fruit 
        flies with defective NF genes
    The enormous promise of NF research--and its potential to benefit 
millions of Americans in this generation alone--has gained increased 
recognition from Congress and the National Institutes of Health. For 
fiscal year 1999, this Subcommittee's continued support will be 
critical to expanding on the basic and clinical research described 
above which is essential to finding a treatment and cure for NF. 
Specifically, this can be accomplished through a four-part NF research 
agenda:
    Increase appropriations for NIH. Our goal should be to translate 
the promise of scientific discovery into an improved quality of life 
for all Americans. To accomplish this ambitious goal, we must continue 
to invest in medical research and the NIH. Sustained growth for the NIH 
is necessary to seize the tremendous opportunities brought about by 
previous research successes, build upon past scientific achievements, 
address present medical needs, and anticipate future health challenges. 
Towards this end, I encourage the Subcommittee to support the 
recommendation of the Ad Hoc Group for Medical Research Funding, a 
coalition of nearly 200 patient and voluntary health groups, medical 
and scientific societies, academic and research organizations, and 
industry, which calls for a 15 percent increase in the NIH budget for 
fiscal year 1999. This represents the first step towards doubling the 
NIH budget over the next five years. I urge members of this 
Subcommittee to join with their colleagues who have introduced 
legislative vehicles for achieving this ambitious but critical goal.
    Increase appropriations for NF research. In addition to holding the 
promise of improving the lives of the thousands of individuals who 
suffer from NF, recent research has demonstrated that NF research 
stands to benefit the 100 million Americans who suffer from cancer, 
brain tumors, and learning disabilities. Therefore, I urge members of 
this Subcommittee to increase funding for NF research at NIH.
    Continue cooperation and coordination between NCI and NINDS through 
targeted NF research programs. In your fiscal year 1998 Report, this 
Subcommittee encouraged NCI and NINDS to coordinate efforts and to 
pursue an aggressive program in basic and clinical research on NF. I 
applaud NCI and NINDS for the coordination that has occurred to date, 
and encourage the Committee to continue to urge continued expansion and 
coordination for NF research through the use of: Requests for 
Applications, as appropriate; Program Announcements; the National 
Cooperative Drug Discovery Group Program; and Small Business Innovation 
Research Grants.
    Target funding for the implementation of the clinical research 
initiatives generated at the Cold Spring Harbor Conferences. As 
developed by Cold Spring Harbor Laboratory at its NF Conference in 
October 1995, NF should become the model for scientist-initiated 
proposals to fund clinical treatment research for specific diseases 
which offer the potential for significant advances in broader areas, 
such as tumor suppressor genes. The Committee should encourage NIH to 
explore this new and exciting avenue in promoting dramatic advances in 
select research areas.
    In closing, Mr. Chairman, with only a small investment, dramatic 
advances in NF research have been made with far reaching implications 
for many other diseases. Many of the worlds leading NF researchers, 
such as Dr. Frances Collins, Director of the National Human Genome 
Project; Dr. Bruce Korf of Harvard Medical School; Dr. Vincent Ricardi 
of the NF Institute in Los Angeles; Dr. David Guttman of Washington 
University School of Medicine; and Dr. Michael Wigler of Cold Spring 
Harbor Laboratory, among others, now believe that with an increased 
investment and a research agenda focused on all aspects of the NF 
research portfolio, from basic research in the labs to drug development 
and genetic therapy, a treatment and cure for NF can be found in the 
next few years.
    I would like to end with a statement that appeared in a recent 
edition of Cold Spring Harbor Laboratory's newsletter which focused on 
major breakthroughs in NF research: ``the hope is that the day may come 
when doctors can flip critical switches to repair the broken circuits 
in each of these disorders and diseases. Such life-changing therapies 
will be the reward for years of enthusiastic basic research.'' I 
believe, Mr. Chairman and members of the Subcommittee, that with your 
continued support, that day will soon be here.
                                 ______
                                 
 Prepared Statement of Kathye Gorosh, Project Director, the Core Center
    Committee on Appropriations Submitted to the Subcommittee on Labor, 
Health and Human Services and Education U.S. Senate Washington, DC
    Mr. Chairman, thank you for the opportunity to present this 
testimony for the record on behalf of the ``Enhanced Provider and 
Patient Education Initiative'' proposed at the CORE Center in Chicago, 
Illinois. To address the national need for a model of ``real time'' 
education and training for HIV care providers at all levels and for 
patients, the CORE Center is proposing the establishment of the 
``Enhanced Provider and Patient Education Initiative.''
    This initiative will create a model technology-based system for the 
education of specialty and community-based providers and the education 
and treatment of patients. It will address an existing national need 
for the effective integration of educational programs to enhance 
provider performance and, importantly, to incorporate patients into the 
decision making process. It will create a system of education and care 
which takes advantage of the new scientific landscape and is centered 
around an information system. It will demonstrate the ability of 
computerized networks, with real time performance feedback, to improve 
the quality of and access to care, to increase compliance and to 
control cost.
    As you know, the development of new and more effective drugs has 
allowed people to remain healthier longer and to delay the progression 
from HIV to AIDS. Nevertheless, it remains critical that we stop the 
spread of HIV as well as provide early and comprehensive care to those 
already infected. Effective education and compliance management 
programs are the only way to prevent the behaviors that lead to the 
spread of resistant strains of HIV. As a result, quality care will be 
provided in a cost-effective manner providing thousands of HIV infected 
individuals with an improved quality of life and enabling them to 
remain productive members of society.
    While there have been dramatic new developments in HIV care due to 
new and more powerful medications, including a 13 percent decrease in 
the death rate from AIDS reported by the Centers for Disease Control 
and Prevention (CDC), these therapies have not been as effective in the 
indigent inner-city urban population. For example, according to the 
Department of Medicine at Long Island Jewish Medical Center in New Hyde 
Park, New York, in 1996 increased cases of AIDS related opportunistic 
illnesses were reported for heterosexual African American and Hispanic 
men and women. This disparity in opportunistic infection trends between 
population groups most likely reflects differences in access to the 
full range of new therapies now available and a lack of targeted 
outreach, education and compliance enforcement efforts aimed at high 
risk populations and at those lifestyles which contribute significantly 
to the transmission of HIV.
    In contrast to the general decline in the number of AIDS related 
illnesses and deaths, the CDC has reported a continuing increase in new 
cases of HIV/AIDS among people of color.
    In November 1997, medical experts at the United Nations reported 
that new infections are occurring worldwide twice as fast as just one 
year ago at 16,000 per day, up from 8,200 per day, with 30.6 million 
living with HIV throughout the world. For children under age 15, the UN 
estimates that 1,600 children are infected each day, up from last 
year's estimate of 1,000 per day. In addition, it is estimated that 
1,200 children die of AIDS each year, up from the prior estimate of 
1,000.
    In the United States, the numbers are equally as chilling. Research 
is showing that the epidemic continues to shift to people of color, 
women and children. Since 1993, there has been a 3 percent increase 
annually in the national prevalence of AIDS. Recent data have shown 
that:
  --One in 250 people in the United States is infected with HIV;
  --One in four of all new HIV infections in the U.S. are estimated to 
        occur in young people between the ages of 13 and 20;
  --Every hour 2 to 4 Americans under the age of 20 become infected 
        with HIV;
  --27 to 54 adolescents are infected with HIV every day;
  --2,354 adolescents ages 13--19 have been diagnosed with AIDS as of 
        December 1995;
  --Among adolescent women with AIDS, 80 percent are African American 
        or Hispanic; and,
  --AIDS is the leading cause of death of people between the ages of 25 
        and 44 in African Americans and Hispanics.
    In addition to the growing numbers of individuals being infected 
with HIV, continuing trends show that the rate of increase is greatest 
among injection drug users and through heterosexual transmission.
    Recent research has shown that the disproportionate incidence of 
HIV/AIDS among inner-city, minority populations is due in large part to 
low rates of compliance and lack of effective community-based, 
comprehensive, health education systems and programs for providers and 
patients.
    Low rates of compliance can most often be attributed to the 
following:
Cost
    The costs for HAART therapy is enormous, as much as $10,000--
$15,000 per patient per year. This figure does not include other costs 
for care or daily medications. There is great concern among people 
living with AIDS that access to care for all people be assured.
    Although the federal program, AIDS Drug Assistance Program (ADAP), 
is designed to provide financial assistance for uninsured or 
underinsured HIV/AIDS patients in purchasing required medications, it 
has been unable to keep up with the increasing demands;
Testing
    Many individuals are hesitant to be tested for HIV and go 
undetected. As a result, patients go without care until the symptoms 
become evident and they are in need of immediate services;
Compliance
    Many HIV infected patients are unwilling or unable to get timely 
clinical care or to adhere to complex and difficult drug regimens. 
Often patients have little or no understanding of newer therapies and 
their potential benefit, resulting in low levels of compliance.
    While many piecemeal health education systems for HIV/AIDS exist 
throughout the United States, there are none that are taking full 
advantage of today's cutting-edge scientific landscape. It is well 
known that the adoption of computerized clinical information systems in 
health care lags behind the use of computers in most other sectors of 
the economy. There is no HIV educational system that provides care, 
clinical assistance and interactive education, while integrating the 
patients and community-based providers into the care giving and 
decision-making process. Especially given today's technological 
advances, this is a striking deficiency in health education systems for 
HIV/AIDS.
    At this critical time in the evolution of the long-term treatment 
of HIV/AIDS, it is important that we focus on the creation and 
implementation of comprehensive educational systems of care for 
individuals affected by HIV/AIDS. This focus will improve treatment and 
prevention efforts, increase the rate of the early detection of HIV, 
increase the rate of treatment compliance and ultimately decrease the 
spread of HIV. It is critical that the federal government focuses its 
resources on creating comprehensive HIV education systems that fully 
integrate specialists, community-based providers and patients and 
evaluate the outcomes of those systems.
    The CORE Center believes that the most effective educational system 
is one which uses today's state-of-the-art technology and creates 
interactive systems of education that provide real-time feedback and 
enables providers to optimize care for HIV/AIDS patients. That is why 
the Center is proposing to establish the ``Enhanced Provider and 
Patient Education Initiative'' a model technology-based system for the 
education of specialty and community-based providers and the education 
and treatment of patients.
    We are at a critical point in the care of patients with HIV/AIDS. 
We have achieved major goals in our basic science understanding of the 
course of HIV disease and have applied this understanding to the care 
of patients
    Successes in the treatment and care of HIV/AIDS have led to 
increased numbers of AIDS patients surviving longer and once again 
becoming productive members of society. Hospital admissions for AIDS 
care are down, and clinics are experiencing dramatic increases in the 
demand for out-patient services. Although science has taken big steps 
toward making AIDS a long-term manageable disease, by no means do we 
have a cure for the largest public health crisis of the century.
    Additionally, given the frequently changing scientific landscape 
and related improvements to available therapies and care protocols, it 
is difficult for specialty-care providers, and more so for community-
based care providers, to keep abreast of the most recent advances in 
care and medication usage. Lack of access to up-to-date information 
also hinders compliance of patients in their therapy and clinic 
schedules.
    There is no successful system in place that provides caregivers and 
patients the education and scientific tools needed to ensure that they 
make the most of the advances in care.
    Patients need to be educated regarding their drug therapies and 
other care options available to them. Because many inner-city patients 
are unable or unwilling to routinely access the local primary health 
care system, this education and compliance is very difficult.
    Moreover, the treatment of patients with HIV/AIDS in Chicago and 
other urban areas is made more difficult by the large number of 
patients receiving care and the large number of potential patients 
whose infections have not been recognized who will ultimately need 
care.
    Compliance for patients in lower socioeconomic populations has been 
more difficult to achieve. Unfortunately, incomplete compliance with 
medication regimens greatly increases the risk of the emergence of 
strains that are resistant to the newest therapies thus increasing the 
likelihood of the spread of HIV/AIDS.
    Specialists alone are not able to provide primary care for all 
affected patients, especially those in underserved communities. This 
means that other providers need to be trained in the complicated care 
of patients with HIV/AIDS to insure that the new HIV medications are 
used appropriately and to the greatest benefit for all patients.
    To be effective, these community providers must have current 
medical data and protocols at their fingertips. They must be able to 
access immediate expertise to ensure the most accurate interventions 
and care for patients. Today, due to weaknesses in the HIV/AIDS care 
infrastructure, they are often unable to access this type of critical 
information or feedback in a timely and effective fashion.
    The Enhanced Provider and Patient Education Initiative will focus 
primarily on methods of optimizing the delivery of care through the 
real time education of specialists, nurse practitioners, physician's 
assistants, and community-based providers caring for people with HIV/
AIDS. The secondary goal is to screen patients with other sexually 
transmitted diseases for infection with HIV and to initiate therapy at 
an early stage of HIV disease.
    The CORE Center's proposed initiative will be composed of four 
elements:
                              i. education
    There is growing evidence that use of practice guidelines and 
disease management systems can help direct and improve care given to 
patients. In the complicated arena of HIV care, where multiple 
antiretroviral regimens are available and where interactions with other 
medications are common, the use of such protocols is particularly 
important.
    The CORE Center's Enhanced Provider and Patient Education 
Initiative will disseminate expert consensus-derived protocols for the 
care of patients in the CORE Center and in the community. It will use a 
comprehensive technology-based education system to implement a program 
for health care providers, including specialists, generalists, nurse 
practitioners, and physicians assistants, to optimize care of HIV/AIDS. 
This system will provide education services both in the CORE Center and 
to the community clinics associated with the Cook County Bureau of 
Health Services.
    Through the use of current state-of-the-art, interactive computer 
technology, this initiative will allow providers to order medications 
and laboratory tests through an interactive computer system which will 
direct therapy by computerized educational screens that appear 
sequentially during the ordering process. These educational screens 
will assist providers in prescribing the most effective, economical and 
comfortable therapies for patients
    Computer facilitated review of patient care will be performed daily 
by using computer flagging systems to ensure that care conforms to 
guidelines and by expert review of computerized records that will be 
transmitted to the CORE Center from affiliated clinics on a daily 
basis.
    Feedback will be provided for caregivers based on the reviews 
described above. This will create a continuous improvement loop. 
Guidelines and additional education efforts will be redesigned on a 
continual basis using the results of computer facilitated reviews of 
patient care. The process will be used for educating patients at each 
visit, teaching patients about HIV disease and related issues and 
integrating patients into the decision making process. It will improve 
compliance with the use of social service interventions for the CORE 
Center's indigent population.
    Computer kiosks stationed throughout the CORE Center will allow 
patients to review information on AIDS treatment, to formulate 
questions, and to interact with other patients.
                         ii. early intervention
    The CORE Center will evaluate early intervention programs in terms 
of their effectiveness and successful coordination with the full 
continuum of care. This program element will target HIV screening of 
inner-city populations with sexually transmitted diseases so that 
advances in HIV care can be made available as early as possible in the 
course of HIV infection and help to stop the increase in the numbers of 
HIV cases reported daily.
    The CORE Center will include a screening clinic for patients with 
sexually transmitted diseases. Currently, only 10 percent of the more 
than 10,000 patients seen yearly at Cook County Hospital with STDs 
undergo screening for HIV infection. The CORE Center will provide HIV 
testing and counseling of all patients who are seen for treatment of 
STDs.
    The CORE Center will assess the impact of early intervention 
programs on the stage of illness at which patients enter into care in 
the CORE Center. Specifically, patients will be seen earlier in the 
course of HIV infection which will improve their chance of responding 
to therapy. In addition, the CORE Center will provide HIV testing and 
counseling for all patients who are seen for treatment of STDs.
                            iii. compliance
    The Center will implement an aggressive compliance program to 
insure application of sound treatment principles and protocols, 
medication compliance and clinical follow-up.
    Provider compliance with treatment guidelines will be measured, 
corrected, and reinforced through innovative use of provider order 
entry systems, as noted above in the education program. Patient 
compliance will be reinforced through participation in the development 
of treatment plans, through clinical pharmacy teaching sessions, and 
through the use of medication reminder devices. The CORE Center is 
currently developing a variety of compliance programs and believes that 
patient will be an important source of patient empowerment and ``buy-
in'' to care.
                        iv. outcomes measurement
    The Center will implement an aggressive and comprehensive outcomes 
measurement program that will measure patient outcomes and cost of care 
by different community provider groups in the CORE Center and the 
community. This HIV/AIDS cost and outcomes data, which does not 
currently exist for any AIDS treatment program, will be extremely 
useful. Importantly, this initiative will also measure improvement 
rates in provider compliance with recommended guidelines and measure 
the cost for achieving improved compliance with treatment protocols.
    In closing, Mr. Chairman, the CORE Center believes that this 
technology-based education initiative is a prototype for national 
efforts to meet the educational challenges presented by infectious 
diseases, especially, HIV/AIDS. As such, the CORE Center is seeking 
$6.9 million over five years for the establishment of the Enhanced 
Provider and Patient Education Initiative.
    Again, I appreciate the opportunity to submit testimony for the 
record and to share with you and the other members of the subcommittee 
the details of this unique initiative. We look forward to continuing to 
work with you and your subcommittee as well as the Administration in 
support of this initiative.
                                 ______
                                 
           Prepared Statement of the Tri-Council for Nursing
    This statement presents the fiscal year 1999 appropriations 
recommendations for nursing education and research of the Tri-Council 
for Nursing. The Tri-Council is composed of four major national nursing 
organizations:
  --The American Association of Colleges of Nursing representing over 
        520 baccalaureate and graduate nursing education programs in 
        senior colleges and universities;
  --The American Nurses Association with 178,000 registered nurse 
        members in 53 constituent state and territorial associations;
  --The American Organization of Nurse Executives representing 5,000 
        nurses in executive practice; and
  --The National League for Nursing on behalf of 1,674 education agency 
        members representing all levels of nursing education, 42 
        constituent state leagues representing 40 states, 104 health 
        care institutions, 67 academic nursing centers and non-academic 
        agencies, and 6, 842 individual members, including consumers, 
        nursing school faculty, and nurse practitioners in community 
        nursing centers.
    The Tri-Council thanks the members of this subcommittee for the 
fiscal year 1998 funding levels for the programs critical to nursing 
education and research: the Nurse Education Act (NEA) (Public Health 
Service Act Title VIII), Scholarships for Disadvantaged Students (in 
PHSA Title VII), the National Institute of Nursing Research (NINR) at 
NIH, the Agency for Health Care Policy and Research (AHCPR) and others. 
We can assure you that these needed funds will be well spent to improve 
the public health.
    For fiscal year 1999 for the NEA, the Tri-Council respectfully 
requests an increase of 8 percent over fiscal year 1998 to a level of 
$70.92 million. For SDS, we seek an increase also of 8 percent over 
fiscal year 1998 to $20.235 million. For NINR, we recommend a 15 
percent increase over fiscal year 1998 to $73.136 million. For AHCPR, 
we ask for an increase of 6 percent over fiscal year 1998 to $155.221 
million. For the National Health Service Corps Scholarship and Loan 
Repayment programs we seek an increase over fiscal year 1998 of 5 
percent to $82.074 million.
The Nurse Education Act
    The NEA is the key source of federal financial support for nursing 
education programs and nursing students. Although it has a student loan 
program open to undergraduates, the NEA primarily seeks to encourage 
preparation of advanced practice nurses (APNs) for underserved 
populations. APNs include nurse practitioners, certified nurse 
midwives, clinical nurse specialists and certified registered nurse 
anesthetists. These well-trained professionals are highly sought after 
by hospitals, community based health care centers and other providers. 
The NEA funds programs to educate APNs and future nursing faculty (NEA 
Sections 821, 822 and 831), offers modest stipends to master's and 
doctoral students (Section 830), and seeks to help disadvantaged 
students attain nursing education (Section 827). NEA Section 820, 
Special Projects, encourages linking training to the delivery of 
primary care for underserved people, assists continuing education in 
rural areas, and encourages schools to increase enrollments. NEA 
Section 846 offers repayment of academic loans for nurses that agree to 
practice in areas of nurse shortage such as public hospitals, community 
health centers, American Indian facilities, and public health services. 
(The NEA reauthorization underway in the form of S. 1754 may streamline 
the law and expand its focus, but existing functions will likely 
continue.) NEA funds serve as federal leverage to reward schools and 
students for meeting workforce needs of our rapidly evolving health 
care system. NEA programs have incentives for schools to train for work 
with underserved populations. Whatever that system ultimately becomes, 
nursing professionals will provide needed healthcare services.
                       accomplishments of the nea
NEA funds
  --Assisted the development and expansion of 60 percent of current 
        educational programs readying nurse practitioners for primary 
        care. 95 percent of NP graduates work in primary care and 44 
        percent of NPs had at least 25 percent Medicaid patients;
  --Supported the development of APN education for specialty HIV/AIDs 
        tracks;
  --Supported about half of the doctorally prepared nursing faculty 
        teaching today;
  --Helped schools to address current and developing care issues such 
        as HIV/AIDS, elderly, school health, high risk perinatal care, 
        rural health, and home health;
  --Fostered programs to prepare nurses to meet the healthcare system's 
        need for nursing professionals to address sicker patients in 
        tertiary care sites, people living longer with chronic 
        conditions, and the often complex health care needs of an 
        increasingly elderly population;
  --Expanded the scope of nursing's use of technology for telehealth, 
        distance learning and information collection and analysis;
  --Provided stipends in 1997 to almost 37 percent of 12,769 full-time 
        graduate nursing students in 267 grants totaling $15.6 million 
        (for example, $910,424 went to 20 Pennsylvania programs);
  --Significantly increased the number and retention of minority 
        nursing students and faculty, boosting the number of minority 
        nursing graduates by 25 percent over the past 5 years;
  --Helped train Certified Registered Nurse Anesthetists (who are sole 
        providers of anesthesia services in 70 percent of rural 
        hospitals) and contributed to the upgrading of the anesthetist 
        faculty and to graduate degrees to meet the strong demand for 
        these professionals;
  --Facilitated development and/or operation of 50 percent of currently 
        operating nurse managed health care centers that serve diverse 
        populations of minorities, elderly, schools, housing complexes 
        and homeless people;
  --Supported 80 percent of certified nurse midwifery (CNM) programs, 
        and 89 percent of CNMs serve low-income women;
  --Provided funds for 10 graduate programs in psychiatric-mental 
        health nursing; and
    Sponsored and collaborated on research on nursing workforce to help 
maintain a relevant educational focus and preparation level.
                     some examples of nea projects
    A Pennsylvania Acute Care Nurse Practitioner program combines 
primary health care skills with acute care clinical skills and is 
designed to attract students from medically underserved areas. An NEA 
project at the Marquette University College of Nursing in Milwaukee, 
Wisconsin developed a Pediatric Nurse Practitioner/Clinical Nurse 
Specialist programs to address the preventive and primary health care 
needs of children living in poverty in a medically underserved area. 
Another NEA grant at the University of Arkansas College of Nursing 
supports a Family Nurse Practitioner program that focuses training on 
underserved rural populations and has placed over half of its graduates 
there. Another NEA grant seeks to increase the numbers of disadvantaged 
and minority nursing graduates at Prairie View A&M University in Texas. 
NEA funds support a nursing center in Kansas City Missouri managed by 
The Research College of Nursing that delivers primary health care 
services 6 days a week to the 520 children and their families at 
Blemheim Elementary School. The NEA facilitates a pioneering program at 
Howard University (Washington, DC) to teach homeless people to become 
successful nursing professionals. Several NEA programs use special 
mentoring and academic assistance to help nursing students complete 
their courses of study and then return to underserved areas to practice 
nursing. The University of Maryland School of Nursing operates 7 school 
based health centers in metropolitan Baltimore with NEA funds as well 
as 2 Wellmobiles on Maryland's rural Eastern Shore.
    The scope and breadth of NEA projects is impressive. Continued 
funding ensures that these good works will be maintained and possibly 
expanded. The need for BSN graduates is expected to increase; 
meanwhile, APNs are in great demand everywhere. The fact is that the 
NEA is the sole source of federal support for APN education.
                scholarships for disadvantaged students
    The Tri-Council recommends a funding level for fiscal year 1999 for 
SDS of $20.235 million, an 8 percent increase over fiscal year 1998. By 
statute, 30 percent of SDS appropriations are reserved for nursing 
students. Most of the nursing SDS money, about $5.6 million in fiscal 
year 1998, goes to baccalaureate students. Schools with proportionately 
greater numbers of minority students are given additional funds. For 
fiscal year 1996 (most recent data), 4,101 nursing students received 
SDS support, and 2,601 or 63.4 percent were minorities. While 
baccalaureate nursing programs have done reasonably well in attracting 
minority students (19.5 percent of baccalaureate enrollments in 1997, 
according to AACN's most recent data), the SDS funds do make a 
difference for the students. Nursing needs federal help to increase the 
diversity of the profession.
                 national institute of nursing research
    NINR is one of the smallest NIH entities, despite the fact that for 
many patients in or out of hospitals, nurses are the major factor in 
their care and management of health care. The Tri-Council strongly 
urges the subcommittee to increase funding for NINR by at least 15 
percent over fiscal year 1998 to $73.136 million. This level will 
enable nursing science to begin to conduct the scope of research 
essential to achieving breakthroughs in patient care, outcomes and cost 
effectiveness appropriate to nursing, the largest health care 
profession. NINR's research agenda concentrates on helping patients 
deal with pain, maximizing the quality of life of people living with 
chronic conditions or the after effects of stroke, avoiding low birth 
weight babies, maternal and child health and other conditions. Indeed, 
interdisciplinary research funded by NINR increases the value of NIH 
research.
    Recently, NINR was assigned to be the NIH lead institute on ``End-
of-Life Care,'' involving complex care, pain management, mental issues 
for terminal patients and emotional issues for critically ill patients' 
families. Not only is this an issue we all must someday face, but also 
with a population that is proportionately getting older, it will be of 
major concern to many more people in the years to come. The way to 
address this issue is to research it; the way to research it is to 
provide NINR with the financial tools it needs to handle this task. For 
this reason, the Tri-Council urges the subcommittee to ensure that 
funding for NINR meets the percentage of increase that NIH receives. In 
fiscal year 1998, NINR was given only 6.4 percent, while NIH got 7.1 
percent. This puts a small institute like NINR at a disadvantage 
because the need for nursing science is huge. The Tri-Council 
recommends at least a 15 percent increase over fiscal year 1998 for 
NINR in fiscal year 1999.
               agency for health care policy and research
    The Tri-Council recommends a 6 percent increase over fiscal year 
1998 for AHCPR to $155.221 million in fiscal year 1999. AHCPR's mission 
is critical to wise utilization of health care dollars because it seeks 
to discover and to publicize which procedures and practices work and 
which don't. Among other things, AHCPR is developing a new Web based 
clearinghouse for clinical practice guidelines and funds a group of 
Evidence Based Practice Centers to examine specific medical and health 
concerns in detail. To spend health care dollars wisely, America needs 
a strong AHPCR.
                     national health service corps
    The Tri-Council suggests a 5 percent increase over fiscal year 1998 
for the National Health Service Corps Scholarship and Loan Repayment 
programs (PHSA Title III) to $82.074 million. This program seeks to 
attract health professionals to Health Professional Shortage Areas. 
Many of those areas are rural, and have difficulty attracting and 
retaining caregivers.
                               conclusion
    In summary, the Tri-Council for Nursing respectfully recommends the 
following appropriations for fiscal year 1999:

Tri-Council for Nursing recommended appropriations for fiscal year 1999

                                                                Millions
Nurse Education Act...........................................   $70.920
Scholarships for disadvantaged students.......................    20.235
National Institute of Nursing Research........................    73.136
Agency for Health Care Policy and Research....................   155.221
National Health Service Corps scholarship/loan................    82.074

Prepared Statement of Tom LaPahe, Council Delegate, Pinon Health Center 
                Project, Pinon, Navajo Nation (Arizona)
    In the early 1980's, the Pinon and Whippoorwill Chapters and the 
surrounding communities initiated plans to design and construct the 
Pinon Health Facility to be located in Pinon, Navajo Nation (Arizona). 
The purpose of establishing a health center in Pinon is to provide 
community members direct and immediate access to adequate health and 
emergency care services to save lives. Although the development of the 
Pinon Health Center Project (Project) has been progressing for quite 
some time, the Project continues to experience funding shortfalls.
    Pinon is geographically located in the middle of the Navajo 
Nation--a considerable distance from major growth areas such as Chinle, 
Window Rock, and Tuba City. The nearest health facility that provides 
general health care, inpatient accommodations, and emergency services 
is the Chinle Comprehensive Health Care Facility, approximately 50 
miles from Pinon. The Pinon community has grown considerably in the 
past ten years. Construction of new school facilities, construction of 
a dormitory housing 600 students and additional housing development has 
contributed to community expansion. There are over 1,500 students in 
the elementary and high school. Pinon, as a result of this expansion, 
has become one of the primary communities where a considerable number 
of Navajo families have relocated from the Hopi Partitioned Lands 
tripling the population.
    Due to increasing population, the community is planning future 
infrastructure development to accommodate needs. Upgrading health care 
service delivery is a necessary and critical part of this development. 
The current Pinon Health Clinic will need to be expanded to meet the 
increasing demand for a comprehensive health facility that will equal 
the medical services provided by the hospital in Chinle. Currently, the 
Pinon Health Clinic is open from 8 a.m. to 4 p.m., three days of the 
week. This requires those seeking emergency medical treatment to travel 
to Chinle to seek needed medical attention when it is not available at 
the Pinon Clinic. During normal weather conditions, persons will travel 
45 minutes, or 50 miles, from Pinon to Chinle to seek medical 
assistance. During inclement weather, persons residing on the far west 
end of the Pinon community have to travel additional miles on 
impassable roads to get into Pinon, then drive to the Chinle hospital. 
This situation extends travel time up to one and a half-hours and in 
severe emergency situations, critical life saving time is lost. Once 
the project is completed, people of Pinon and the surrounding 
communities will no longer have to risk their lives to receive minor 
and major health care at the current clinic.
    An estimated $34.2 million is required for construction of the 
health facility and is considered the fourth priority of the National 
Indian Health Services Construction Priority list for outpatient 
facilities. In addition, approximately $1.04 million is needed to 
complete the design phase that was funded in fiscal year 1990. In 
fiscal year 1989, $50,000 was appropriated by the US Congress for the 
initial stage of the Project's design and $84,000 was appropriated 
again in fiscal year 1990, however, additional monies are needed in 
fiscal year 1999. The Navajo Nation Council's Health and Social 
Services Committee has endorsed the aforementioned dollar amounts as 
outlined in Resolution HSSCF-24-98.
    If moneys are not secured to complete the design phase and budgeted 
to begin construction of the health facility, overall cost will 
escalate and the project will be further delayed. I strongly believe 
the health, welfare, safety and accessibility to quality health care 
are at stake and may be jeopardized.
    The Pinon community greatly needs this project to move forward--
tragic loss of life has already been experienced due to the lack of 
emergency facilities and the distance form Pinon to Chinle. Without the 
Pinon Health Care Facility, families will continue to confront loss of 
life due to lack of a nearby health facility. To immediately reduce 
tragic losses and contain the escalating costs, Congress must 
appropriate funds in fiscal year 1999 to complete the design phase and 
the Clinton Administration must budget for the construction of the 
Pinon Health Facility at Pinon, Navajo Nation (Arizona) next fiscal 
year.
                                 ______
                                 
Prepared Statement Michael E. DeBakey, M.D. and the Hon. Paul G. Rogers 
   on Behalf of the Friends of the National Library of Medicine (NLM)
    On behalf of the Friends of the NLM, it is our pleasure to submit a 
statement for the record on the need to double funding for the National 
Institutes of Health over the next five years, and particularly to 
double support for the National Library of Medicine (NLM), the world's 
largest and most prestigious medical and scientific library located at 
the NIH.
    We are Michael DeBakey, Chancellor Emeritus and Professor of 
Surgery at Baylor College of Medicine in Houston, Texas, and Paul G. 
Rogers, Chairman of the Friends of the NLM. The Friends of the NLM is a 
national nonprofit organization whose mission is to increase awareness 
and use of this preeminent national treasure, the NLM. Our membership 
includes medical societies and associations, health sciences schools, 
medical librarians, health professionals and companies that share our 
vision. The motto of the Friends is The More You Know, The Better You 
Heal, and that is perhaps an apt point on which to begin.
    We appreciate this opportunity to offer our perspective on the 
current state of the nation's medical research and, in particular, on 
the spectacular emergence of information technology as a new essential 
component of the whole biomedical research enterprise.
             unlocking the mysteries of disease and health
    As America approaches the turn of a new century, we are poised on 
the brink of a revolutionary new era in medical knowledge. Mysteries 
about the nature of the human body and its disorders that have baffled 
medical scientists for centuries are beginning to be revealed. Major 
new breakthroughs in genetics, molecular biology, human biochemistry, 
and many related fields, are converging to unlock our understanding of 
and treatments for cancers, diabetes, Alzheimer's, AIDS, and many other 
diseases. This knowledge explosion in medicine has only just begun. As 
we approach the millennium, these advances hold the promise of 
dramatically increasing our ability to improve the quality of human 
life.
    Many of these exciting breakthroughs are inextricably tied to the 
emergence of new information technologies. Researchers around the world 
now have instantaneous access to the latest biomedical knowledge thanks 
to MEDLINE and other online databases of the National Library of 
Medicine. Medical and scientific research now and in the future begins 
at the computer screen, enabling our research dollars to go further and 
avoid wasteful duplication of effort.
    While we are submitting this statement specifically to address the 
vital programs of the National Library of Medicine, we strongly support 
the efforts to double funding for all of the National Institutes of 
Health over the coming five years. We simply can think of no better 
investment of public resources.
    Thanks to America's wise investment in a broad array of biomedical 
investigation, the NIH has become the world's preeminent medical 
research institution, the engine of cutting-edge investigation of human 
afflictions and the repository of vast stores of scientific information 
available to researchers and laypersons around the globe.
    the nlm: linchpin between communication technologies and health
    As ardent champions of the importance of making available 
scientific information to the public as well as to medical 
practitioners and researchers, we would like to draw your attention to 
the ways in which digital technology is enhancing the value of public 
investment in the NIH.
    The National Library of Medicine, located in Bethesda and a part of 
the NIH, has been a leader in developing and applying the latest in 
communications technologies to improve health. From the birth of the 
computerized MEDLARS system in the 1960s, to the introduction of the 
online database, MEDLINE, in the 1970s, to today's DNA databases and 
World Wide Web based services, the Library has played an increasingly 
central role in the life of American medicine.
    Last year marked a stunning milestone for the NLM in this regard. 
In June, 1997, beginning with a packed Capitol Hill press conference 
led by Vice President Al Gore and Senators Arlen Specter and Tom 
Harkin, the Library launched free, public use of MEDLINE via the World 
Wide Web [WWW]. As you may know, prior to that time the database--which 
is the world's largest medical database--was open only to registered 
users who paid a search fee.
    We are delighted but not surprised to report to you that MEDLINE 
use has risen tenfold since that time, to more than 300,000 searches a 
day. Researchers, medical practitioners, and students are rightly 
thrilled with MEDLINE's easy-to-use, free search capabilities. What is 
particularly extraordinary, is that almost one-third of those who are 
accessing the service are simply citizens seeking health-related 
information. With this in mind it is noteworthy that NLM is enriching 
MEDLINE with carefully selected consumer health newsletters published 
by medical schools and government agencies.
    We are particularly proud of the outreach efforts the NLM has taken 
to educate the public about the potential of online medical knowledge 
to save lives. For example, both ER and Chicago Hope television shows 
have recently used story lines that involve MEDLINE searches. The 
stories have been based on actual true stories where vital, life-saving 
information was found because a simple literature search was undertaken 
by the doctor. You may have seen the ER episode where a boy arrives in 
the emergency room and has a ``numb chin''. This baffling symptom is 
diagnosed as lymphoma when nurse Hathaway performs a MEDLINE search. 
The real situation happened in an Atlanta community health clinic.
    We agree with The Speaker of the House, Newt Gingrich, who wrote in 
Roll Call column a few weeks ago that ``the development of a universal 
system of knowledge accessible to both professionals and patients'' is, 
in conjunction with increased funding for medical research, the 
linchpin of ``a dramatically healthier and financially smarter'' health 
care system for the 21st century.
    The new free MEDLINE demonstrates the validity of the Speaker's 
vision for the future: A consumer-oriented system in which individuals 
take greater responsibility for maintaining their health begins with 
access to current credible information about diseases and disease 
prevention.
    MEDLINE is the hub of the emerging health information system. Since 
making MEDLINE free via the Web last summer, more than 100 medical 
journals now have direct links to the existing database enabling 
searchers to access full text of the article. And, that effort will 
only increase in the future, making MEDLINE an increasingly valuable 
and vital source of comprehensive biomedical information.
    Clearly the NLM will need significantly more resources to reach out 
to both health care professionals and the public about free MEDLINE.
                  nlm's role in improving health care
    We have highlighted the role of MEDLINE in expanding the return on 
the public's investment in medical research. But we certainly believe 
that health care practitioners themselves are primary beneficiaries of 
the new information technologies. It was not too long ago that research 
findings took years to wend their way into clinical practice. Today 
computer-literate members of the medical community around the globe can 
access state-of-the-art research information almost as soon as it is 
published.
    It is impossible to overstate the significance of the change such 
access represents over the traditional system in which doctors practice 
the medicine they learned in medical school. Even at the current rate 
of new developments, practitioners' knowledge becomes outdated in less 
than a few years. And, the pace of advances is only going to increase 
in the years ahead.
    To quote Speaker Gingrich again: ``Thirty years from now, we will 
have somewhere between 10 and 1,000 times the amount of information we 
have today on the human body. Therefore, another goal [of medical-
research funding] should be the transmission of knowledge to the 
practitioner within no more than 12 to 18 months of discovery.''
    We concur in this vision for rapid information flow between 
research and practice, and believe MEDLINE is the wellspring.
            digital imaging and the next generation internet
    In its Visible Human Project, the NLM has developed another 
breathtaking application of information technologies: a digital 
``library'' of CAT, MRI, and cryosection images, at one millimeter 
intervals, of the male and the female body. Begun in the last decade, 
this project is producing CD-ROMs and related materials for teaching 
and research that are now being used throughout the world. We are 
particularly proud that more than 1,000 commercial and nonprofit 
licenses have been issued by the NLM to use this free public database 
of images.
    In addition, we are proud of the NLM's leadership in the federal 
government's Next Generation Internet Project, and overall efforts to 
use advanced telecommunications to improve health. This initiative, 
which involves a number of federal agencies and academic institutions, 
will experiment collaboratively with telecommunications technologies to 
increase the speed of data transmission by up to 100 times current 
levels while ensuring data integrity, security, and reliability. 
Success in this venture promises to propel the advance of telemedicine 
and telehealth, with its need for absolute reliability and data-heavy 
image transfers, into a new level of usefulness as a tool in medical 
practice.
    Already NLM has invested significantly in telemedicine projects 
that are beginning to bear fruit. Just a few weeks ago a Boston 
newspaper ran a feature about how an NLM-sponsored telemedicine project 
in that city was helping new mothers care for infants whose precarious 
health requires special attention.
    The Next Generation Internet also will allow NLM's National Center 
for Biotechnology Information to create high-speed, reliable 
connections between the Center and contributing genome sequencing 
centers and the worldwide participants in the National Cancer 
Institute's Cancer Genome Anatomy Project. A new database containing 
the entire genome of the malaria-causing mosquito would also be 
created. High-speed connectivity is necessary if we are to process the 
avalanche of data coming out of the mapping centers, develop new 
computational analysis software, and provide effective access to 
scientists around the world. Most importantly, the ``next generation'' 
NLM will be able to make accessible images and other complex data as 
well as text materials to online researchers.
                                summary
    We hope this brief account suggests our reasons for agreeing with 
leading members of Congress that it is indeed appropriate and essential 
to double federal funding of the National Institutes of Health and the 
National Library of Medicine over the next five years.
    This is a moment of unparalleled possibility in the history of 
medical science, and we believe there is no better way to improve the 
lives of all Americans than to increase investment in the work of 
preventing and treating disease.
    We believe the investment in NIH, and particularly for the National 
Library of Medicine, will result in the best health care and quality of 
life. Thank you.
                                 ______
                                 
 Prepared Statement of Vicki Kalabokes, Co-chair Coalition of Patient 
             Advocates for Skin Disease Research [CPA-SDR]
    Mr. Chairman and members of the subcommittee, my name is Vicki 
Kalabokes. I am the co-chair of the Coalition of Patient Advocates for 
Skin Disease Research [CPA-SDR]. The Coalition wishes to express its 
sincere thanks to you, Mr. Specter, and to members of the Subcommittee 
for your unwavering support of the NIH and biomedical research. The 
Coalition also thanks you for providing us with the opportunity to 
submit written testimony.
    The Coalition of Patient Advocates for Skin Disease Research joins 
with our colleagues in the Ad Hoc Group for Medical Research Funding 
and the NIAMS Coalition to request an increase of 15 percent for the 
National Institutes of Health (NIH) in fiscal year 1999. This increase 
would provide the first year installment towards an effort to double 
the budget of the NIH over the next five years.
    Although research into the basic mechanisms of skin disease is 
supported throughout the NIH, it is the mission of the National 
Institute of Arthritis, Musculoskeletal and Skin Diseases (NIAMS) to 
address the causes, treatment and prevention of diseases of the skin. 
An increase of 15 percent would provide the NIAMS with a budget of $316 
million in fiscal year 1999.
    The Coalition is comprised of over 20 national lay skin disease 
organizations. The member organizations of the CPA-SDR are supported by 
patients and their families, Americans who live with skin disease 
daily. For the majority of patients served by our member organizations, 
treatment options continue to remain limited or, in some cases, 
nonexistent. The skin diseases represented by the CPA-SDR are chronic, 
costly, disfiguring, and sometimes fatal.
    It is estimated that over 60 million Americans are treated each 
year for skin disease; skin disorders are among the ten most frequent 
reasons for physician visits annually. Skin disease is the most common 
cause of chronic illness in the United States and its economic cost is 
staggering--over $7 billion every year.
    Funding for biomedical research at the NIAMS has significantly 
advanced our understanding of the skin, its important role in our 
immune system, and the structure and function of connective tissue. 
While much progress has been made, much more must be understood if we 
are to take the breakthroughs from the lab to the bedside.
    Let me now discuss with you recent important breakthroughs in skin 
disease:
  --The basic molecular mechanisms for two very serious, blistering 
        skin diseases, epidermolysis bullosa (EB) and pemphigus, has 
        been uncovered. In addition, scientists have also elucidated 
        the molecular mechanism in a variant of EB that is associated 
        with muscular dystrophy. This discovery provides scientists 
        with a new understanding of muscle physiology in relation to 
        muscle wasting disorders.
  --The efforts of this Subcommittee has provided for many 
        breakthroughs in the treatment of lupus. Now special prevention 
        and education programs are in place to screen young minority 
        women most at risk for this terrible disease. It is hoped that 
        the screening process will allow physicians to diagnose this 
        disease in its earliest stages, drastically reducing costs and 
        improving outcomes.
  --Tissue banks have been established for several skin diseases, 
        including psoriasis, EB and ichthyosis. These pioneering 
        efforts will lead to advances in therapies and ultimately cures 
        for these diseases.
  --Researchers now know that port wine stains form during the first 2-
        8 weeks of gestation. Additional research is needed to 
        elucidate the role of angiogenesis in these stains.
  --Researchers at the NIAMS and the National Cancer Institute have 
        significantly advanced our understanding of skin cancer, the 
        most common form of cancer in the United States. We now know 
        that a gene is responsible for a rate inherited disorder, basal 
        nevus syndrome and acquired basal cell carcinoma.
  --Ichthyosis is a family of rare diseases in which there is abnormal 
        development of the outermost layers of the skin. Researchers 
        have made an important discovery--the genes for many of the 
        molecules involved with the structure of our skin are clustered 
        on chromosome 1. This area of chromosome 1 is called the 
        epidermal differentiation complex.
  --During the past year, the locus for pseudoxanthoma elasticum (PXE) 
        was isolated. A recent international meeting on PXE was 
        sponsored by the NIAMS and helped to define the next steps 
        toward treating this disease. This may be a small step in 
        understanding the complexities of PXE, but it provides the 
        first glimmer of hope that a cure can be found.
    Despite our progress, many extraordinary grants remain unfunded. 
Historically, the NIAMS has been below the NIH average with regard to 
success rate. This means that the NIAMS has funded fewer meritorious 
grants than many other institutes. Increased funding for the NIAMS will 
allow the institute to support more research grants in key areas of 
opportunity.
    The Skin Diseases Research Core Centers are another important part 
of the NIAMS effort to unlock the many remaining mysteries of skin 
disease research. The CPA-SDR thanks the members of this Subcommittee 
for your support of these centers. In addition to the core centers, 
NIAMS has also announced that research initiatives in scleroderma would 
be eligible for funding under the SCORs program.
    A skin disease research center grant provides funds for 
integrating, coordinating, and fostering interdisciplinary cooperation 
of a group of established investigators conducting research programs of 
high quality that relate to a common theme in skin disease. These 
centers bring together related facilities within six large, prestigious 
medical universities to pursue interdisciplinary research on skin 
diseases. By providing more accessible resources, these special grants 
ensure greater productivity at a given grantee institution. Indeed, a 
recent review of the centers programs supported by the NIAMS points to 
the skin disease core centers as a model for future efforts.
    In addition to basic research funding, the members of the CPA-SDR 
are very concerned about support for clinical, patient-oriented 
research and for research training funds. We were pleased to learn of 
the high priority that Dr. Stephen Katz, the NIAMS Director, has placed 
on these areas. Translating the great discoveries of the bench to the 
bedside is critical, if we hope to improve the quality of life for skin 
disease patients. Furthermore, we must do everything that we can to 
encourage brilliant minds to consider a career in skin disease 
research. Funding for the NIH must include funding for increases in 
training stipends and encourage more experienced scientists to mentor 
new investigators.
    We, the Coalition of Patient Advocates for Skin Disease Research, 
thank you again for your support and ask for your continued support in 
fiscal year 1999. Your commitment has meant so much to the many 
families that cope with chronic skin disease each and every day.
                               disclosure
    The Coalition of Patient Advocates for Skin Disease Research 
receives no federal funding. The National Alopecia Areata Foundation, 
for which Ms. Kalabokes serves as executive director, received less 
than $5,000 from the Combined Federal Campaign.
                                 ______
                                 
         Prepared Statement of the American Medical Association
      medicare resource-based practice expense--medicare user fees
    The American Medical Association (AMA) would like to submit the 
following statement for the record regarding the implementation of 
resource-based practice expense relative values, and the 
Administration's proposal to implement user fees in the Medicare 
program.
Medicare resource-based practice expense
    The Balanced Budget Act of 1997 (BBA) included important provisions 
regarding the Health Care Financing Administration's (HCFA) development 
of resource-based practice expense values. Due to major problems with 
HCFA's initial proposal for resource-based practice expense values, the 
AMA strongly supported the BBA provisions extending the implementation 
date for the new payments and requiring that HCFA revise its proposal 
to incorporate accurate cost data. We were also pleased that Congress 
directed the General Accounting Office (GAO) to evaluate HCFA's methods 
and data and the potential impact of the payment changes on beneficiary 
access. The AMA continues to support the change to resource-based 
values, so long as they reflect the actual costs of clinical practice.
    Since enactment of the BBA, we have been impressed with the 
dedication of both GAO and HCFA staff to meeting the Act's 
requirements. Project teams from both agencies have consulted 
frequently with AMA staff, particularly with regard to potential use of 
data from the AMA's annual survey of physicians in the new values. We 
believe that the GAO has developed an excellent report, and its 
recommendations are consistent with AMA policy.
    The AMA is encouraged that HCFA's recent Report to Congress, also 
required by the BBA, suggests that HCFA is likely to adopt many of the 
modifications recommended by the GAO. Many of the GAO recommendations 
encourage HCFA to conduct sensitivity analyses and explore alternative 
options. The GAO does not recommend that HCFA use one specific 
alternative for the new values; however, and HCFA's report suggests 
that HCFA also is weighing multiple options. The AMA believes that HCFA 
should publish several different methodological options in its May 1998 
proposed rule. The options could vary in the degree to which the 
practice expense values are based on the expert panel data or on data 
from the AMA's Socioeconomic Monitoring System (SMS).
    Although the SMS was not designed to support the development of 
relative values and the sample sizes for some specialties are not large 
enough to produce statistically valid responses, it has become clear 
that no other valid and reliable cost data are currently available. 
With a response rate greater than 60 percent, the SMS is of high 
quality and is the only existing practice expense database derived from 
a randomly selected national sample. The SMS core survey has been 
conducted since 1982 by respected survey research firms and its 
validity is well-recognized. Therefore, the AMA, the GAO, and a number 
of medical specialties now agree that HCFA should make use of 
specialty-specific data from the SMS.
    This use of specialty-specific data would be a marked departure 
from HCFA's June proposal, which used the SMS data only to establish 
the total proportion of direct and indirect practice costs. The SMS 
reveals significant practice cost differences among specialties, 
however, including wide variations in the total dollars expended on 
practice resources per hour worked, as well as on individual cost 
components, such as medical equipment, staff labor, and materials and 
supplies.
    The AMA also agrees with the GAO that use of expert panels is an 
appropriate way to gather information about procedure-specific, or 
direct practice costs. However, the way that HCFA used the panel data 
in its June proposal indicated that even the agency itself had little 
confidence in the results. A variety of methods were utilized, 
including a statistical approach called ``cross-specialty linking'' and 
a series of across-the-board data ``edits'' that substantially reduced 
the cost estimates provided by the expert panels. HCFA did not describe 
the criteria that it used to judge the relative accuracy of the panel 
estimates. Nor did it explain its apparent conclusion that only one of 
the panels produced accurate results. Moreover, in contrast to the 
process used to construct the physician work values, the cross-
specialty linking process for practice expense relied exclusively on 
statistical methods, with no opportunity for clinical judgment.
    Despite our criticism of the way HCFA altered the direct cost data 
in its June proposal, however, the AMA believes that, if the expert 
panel data are to be a significant component of the new values, they 
require some adjustment and should not be used ``as is.'' AMA observers 
attended all of the expert panel meetings and concluded that the panel 
estimates of billing costs, and possibly other administrative costs, 
were of questionable validity. Over the last six months, HCFA has made 
several well-intentioned but unproductive efforts to evaluate and 
correct these data. In our estimation, it is now time to move on and 
try other approaches to obtain accurate billing and administrative cost 
estimates.
    We support the GAO recommendation, therefore, that HCFA either 
modify its linking approach significantly or eliminate the need for 
linking by making targeted adjustments to improve the expert panel 
data's consistency. We also agree with the GAO that the agency should 
explore the option of including billing and other administrative costs 
in indirect costs, such as office rent and other overhead costs. This 
approach would eliminate the need to rely on panel estimates to measure 
billing and administrative costs for each procedure, thereby also 
eliminating the need to adjust or link the panel estimates for these 
resource costs.
    With the expert panel and SMS data, we believe HCFA could develop 
reasonably accurate values. HCFA's Report to Congress and recent 
testimony suggests three major options for the revised proposal:
  --Use the adjusted expert panel data for direct costs and SMS data on 
        specialty costs per hour worked for indirect costs.
  --Use the SMS data on total specialty costs per hour worked as the 
        basis for the new values and use the expert panel data to 
        allocate costs and assign relative values to specific codes 
        within a specialty.
  --Use the linked expert panel data for direct costs and use the SMS 
        data to calculate specialty-specific ratios of direct to 
        indirect costs in determining indirect relative values.
    If possible, the AMA would like to see all three of these options 
published in the new proposed rule. Since all three options rely on 
existing data, the AMA agrees with the GAO that starting data 
collection over again would needlessly increase costs and delay 
implementation. While we are eager to see a detailed new proposal 
explaining how HCFA plans to use the various extant databases, we think 
it is highly likely that these data will prove sufficient for initial 
implementation of the new values to proceed as scheduled in January 
1999.
    Nonetheless, we also appreciate the GAO's recognition of the need 
for HCFA to engage in some limited additional data collection to 
validate the expert panel data and expand the information available 
from the SMS. These supplemental data collection efforts should be 
initiated before a final rule is issued, continue during the transition 
period, and be used to refine the initial values. As a first step, we 
believe HCFA could collect data on administrative and equipment costs 
from a representative sample of medical practices, firms that provide 
billing, coding, transcription, and equipment procurement services to 
practices, and industry groups such as the Medical Group Management 
Association and the Health Industry Manufacturers Association.
    One of the most serious flaws in HCFA's June 1997 proposal was the 
application of a ``behavioral offset'' that would have removed more 
than $1 billion from Medicare's budget for physician services. HCFA 
actuaries' assumption that physicians would manipulate patient demand 
to recoup 50 percent of any payment reductions in their services led to 
a proposed 2.4 percent payment cut for all services. An earlier 
analysis by Physician Payment Review Commission (PPRC) staff suggested 
that the actuaries' assumption was incorrect.
    Both the Medicare Payment Advisory Commission (MedPAC) and HCFA's 
Practicing Physicians Advisory Council have now recommended that no 
behavioral offset be applied when the new practice expense values are 
implemented. The AMA wholeheartedly endorses these recommendations. 
There is no reason to expect that physicians will manipulate 
utilization in response to payment changes. If for any reason 
utilization experience differs from projections, however, the 
expenditure target, or Sustainable Growth Rate established under the 
BBA, will adjust future payment updates to recoup any spending over the 
target. There is thus absolutely no reason to apply any behavioral 
offset.
    Finally, we think it is important to note that controversy over the 
development of new practice expense values stems partly from the 
requirement that total practice costs under the new system cannot 
exceed practice costs under the old system. The problem with that 
requirement is that it ignores any increases in practice expenses that 
may have occurred since the original system was developed. We believe 
that physician costs have increased, however, in part because hospital 
restructuring and changing practice patterns have shifted care from the 
inpatient to the outpatient setting.
    For example, a number of cardiovascular services now are frequently 
provided in the office rather than the hospital. Patients with complex 
illnesses that once would have required hospitalization are being 
treated in physicians' offices. Shorter lengths of stay for many 
surgical procedures have increased the number of post-surgical services 
and supplies provided in physicians' offices. In addition, it is 
possible that the volume of physician services may rise as more and 
more care is provided outside the hospital. Physicians then could 
exceed the expenditure targets established through Medicare' 
Sustainable Growth Rate formula, thereby triggering reductions in their 
future payment levels.
    To fairly reimburse physicians for the increased overhead they 
incur from these changes in the current Medicare environment raises 
some difficult questions, however. Since virtually all payment changes 
today are required to be budget neutral, any efforts to compensate 
physicians for new costs they have assumed must be offset with payment 
cuts elsewhere in the Medicare program. Inpatient hospital services and 
physicians are paid out of two separate pools of money, however, so 
unless Congress directs otherwise, the offsetting pay cuts can only be 
applied to other physician services.
    Since physicians are already subject to tighter constraints than 
other Medicare providers, many could be forced to respond to these 
additional pressures in ways that could erode the quality of care 
Medicare beneficiaries now receive. The AMA therefore suggests that 
Congress direct HCFA or MedPAC to consider whether some redistribution 
of funds between Parts A and B is needed to accommodate recent changes 
in the medical delivery system. We urge the Appropriations Committee to 
call for and appropriate funds for such a study.
Medicare user fees
    The AMA is adamantly opposed to a series of so-called ``user fees'' 
included in the President's latest budget plan. Let us be clear: these 
proposals are not really ``user fees''. Instead, they represent a 
significant new tax on physicians and other health care providers and 
are completely at odds with Congressional leaders' goal of reducing or 
holding the line on taxes.
    If enacted, these proposals could reduce Medicare's status with 
physicians to the same low levels as Medicaid's. Surveys by the 
Physician Payment Review Commission suggest that Medicare's physician 
payment rates are nearly a third lower than most private plans' rates. 
That gap is likely to widen under the terms of last year's Balanced 
Budget Act (BBA) since the Congressional Budget Office anticipates that 
over the next five years, Medicare's physician payment rates will fall 
by 11 percent across-the-board or 19 percent after adjustment for 
inflation.
    Even as their payments have eroded, physicians have been hit year 
after year with burdensome new administrative duties that increase 
their overhead and detract from their time with patients. In their 
effort to root out fraud in federal health programs, government 
officials have contrived ever more elaborate paperwork requirements 
that frequently seem to assume that all doctors and hospitals are 
guilty of fraudulent behavior. At the same time, funds for informing 
doctors about new rules have shriveled, leaving them vulnerable to 
potential fraud charges should they misinterpret any of Medicare's 
45,000 pages of complex rules and regulations.
    To add insult to injury, the President now is asking physicians and 
other providers to pay for the privilege of dealing with Medicare's 
extensive paperwork and low payments. Alarmingly, his budget seeks more 
than $850 million in total and $660 million in new ``user fees'' or 
taxes. Between 13 percent to 15 percent of program administration costs 
would be financed out of the pockets of physicians and other providers. 
Government expenditures for running Medicare would drop to a paltry 1 
percent of benefits or less than 10 percent of what even the most 
efficient private plans spend.
    None of the new taxes or ``user fees'' would go into education or 
provider relations and many of the proposals would exacerbate Medicare 
costs and hassle. For example, under one proposal, doctors would be 
charged $1 for every duplicate or unprocessible claim. Physicians then 
would be penalized for resubmitting claims even when payment was 
seriously overdue or when the contractor had rejected the claim for 
trivial reasons. Should the Iowa doctor whose claims were denied 
because the contractor disapproved of his signature really have to pay 
for the right to go through the hassle of resubmitting all claims?
    In another plan, rejected by Congress in the past, the President 
also wants to charge $1 to process any claim submitted on paper rather 
than electronically. Budget documents refer to a possible waiver for 
rural physicians but it is our understanding that the waiver would be 
so narrowly drawn that few physicians would qualify. Is it fair or wise 
to ask physicians anticipating retirement in a few years to invest in 
new computer equipment or leave Medicare? Other than raising money, is 
there any real purpose to another administration proposal to force 
physicians to enroll ($100) and re-enroll ($25 every five years) in 
Medicare?
    To make matters worse, the same budget that asks physicians to help 
finance Medicare's operation also proposes to double prepayment claims 
reviews. Physicians certainly do not condone fraud and the AMA supports 
appropriately-designed prepayment reviews. However, past experience 
suggests that prepayment review sometimes results in automatic and 
unjustified claims denials. Physicians then will experience yet another 
increase in the costs of treating Medicare patients as they are forced 
to appeal all these automatic denials in order to receive the payments 
that are due them.
    The timing for the President's onerous new tax proposal could not 
be worse. As the government prepares to launch the BBA's Medicare 
reforms, elderly and disabled patients are likely to look to their 
physicians for information on the wide array of new choices and 
benefits available to them. But physicians coping with lower payments, 
increased paperwork, and new taxes may be forced to see more patients 
every day to cover their overhead. Many may find that they do not have 
time to stop and talk to patients about their new Medicare choices.
    If the reforms Congress enacted in the BBA are to fulfill their 
promise, Medicare needs to spend more money, not less, on program 
administration. We therefore concur with the Administration that 
additional resources are needed and we urge lawmakers to move quickly 
before more key senior Medicare officials leave the program to work in 
private industry. The true users of Medicare are its 37 million 
beneficiaries, however, and we submit that the cost of running the 
program should therefore be shared by all Americans.
    To pretend that the program can be adequately and equitably 
financed through a rash of new taxes on physicians and other providers 
is an elaborate and dangerous ruse that abdicates this nation's 
responsibility to its most venerable and vulnerable citizens. Like the 
Congressionally-created Practicing Physicians Advisory Council, we are 
unalterably opposed to this outrageous proposal and urge Congress to 
reject it swiftly and soundly.
    The AMA appreciates this opportunity to submit our views for the 
record. We would be happy to respond to any questions the Committee 
might have on these important issues.
                                 ______
                                 
  Prepared Statement of the Association of Maternal and Child Health 
                                Programs
    Thank you for the opportunity to provide testimony to the Senate 
Labor Health and Human Services Appropriations Subcommittee. We, at the 
Association of Maternal and Child Health Programs, appreciate the 
Subcommittee's support of the Maternal and Child Health Services Block 
Grant.
    For over 60 years, programs authorized within Title V of the Social 
Security Act, the Maternal and Child Health Services Block Grant, have 
helped fulfill our nation's strong commitment to improve the health of 
all mothers and children. State Maternal and Child Health (MCH) 
programs, supported by the federal Maternal and Child Health Services 
Block Grant, have demonstrated their ability to adapt through decades 
of change by responding to the emergence of new diseases, discovery of 
new vaccines, and evolving health financing and delivery systems while 
still fulfilling their core mission of improving the health of all 
mothers and children. Congress has remained committed to this public 
health program because it provides proven, preventive health care with 
demonstrated results. These results include reducing maternal and 
infant mortality, improving the health of newborns, immunizing and 
screening children to prevent life-threatening diseases, and helping 
children with disabilities function to their full potential.
    The Maternal and Child Health Services Block Grant is the basic 
framework upon which states have built and maintained their systems of 
care for women and children. This framework assures access to quality 
maternal and child health services, including care for children with 
special health care needs. State MCH programs carry out core public 
health prevention activities, as well as provide or finance direct 
services for women and children who lack access to necessary care.
                        public health prevention
    Investment in public health enables Americans to live longer 
healthier lives by preventing premature death and disability. In order 
to meet the challenges ahead, Congress must continue to invest in a 
continuum of public health activity that not only includes biomedical 
and behavioral research, but also includes investment in targeted 
health care services, disease prevention, and other cost-effective 
strategies such as those aimed at improving the health of women and 
children. As a proportion of overall health expenditures, federal 
public health activities account for approximately $25 billion of the 
estimated $1 trillion, roughly 3 percent, spent on health care in the 
United States.
    Investment in public health, including maternal and child health, 
is cost-effective, preventive in nature, and results in improved health 
outcomes for mothers and children. For every dollar invested in 
prenatal care, three dollars are saved in subsequent health costs for 
the care of a low birth weight baby. MCH programs also assist in the 
delivery of immunizations to children. Immunizations are widely known 
to be cost-effective, and for every dollar spent on measles, mumps, and 
rubella vaccine $21 is saved.
    Another important MCH program, newborn screening, prevents chronic 
diseases and disability through early detection, diagnosis and 
treatment. Currently, nearly all 4 million newborns receive screening 
in order to avert tragic health consequences from genetic, metabolic, 
hearing and other disorders. In Illinois, 99 percent of its 190,000 
newborns are screened for at least 6 disorders including sickle cell 
anemia. In Hawaii, the expansion of newborn hearing screening has 
enabled the average age of hearing loss identification to drop from 4 
years of age in 1987 to 1 month in 1995. In addition to newborn 
screening, MCH programs provide early intervention and coordination of 
care for children with chronic diseases and disabilities. Through these 
efforts, children are able to function more independently and avoid 
institutionalization. Florida estimates saving $21,000 per disabled 
child over a 20 year period because of such early intervention efforts.
    Finally, another important public health threat that is receiving 
increased attention this year is tobacco. Tobacco use and exposure to 
environmental tobacco smoke pose exceptional and immediate risks to 
pregnant women, infants, children, and youth. The serious health risks 
include low birth weight which is the strongest determinant for infant 
mortality and is associated with a wide range of problems. These health 
problems include cerebral palsy, epilepsy, respiratory illnesses, and 
learning disabilities. In 1995, the estimated costs of birth 
complications attributed to smoking were conservatively estimated at $1 
billion. Given the enormous impact of tobacco on maternal and child 
health populations, state MCH programs have long supported tobacco 
control policy. They have worked in partnership with community-based 
groups, other public agencies, and the private sector to prevent and 
end nicotine addiction. The Association of Maternal and Child Health 
Programs (AMCHP) supports public health prevention strategies aimed at 
preventing tobacco use among our nation's pregnant women and youth.
    With demonstrated, preventive programs such as prenatal care, 
immunizations, newborn screening, smoking cessation, and care for 
children with disabilities, the Maternal and Child Health Services 
Block Grant is a sound investment in the health of children and 
pregnant women.
                           populations served
    The Maternal and Child Health Services Block Grant directly serves 
over 17 million women and children. Through grants, contracts, or 
reimbursements to private and public sector providers, state MCH 
programs support the availability and accessibility of community health 
and family support services, especially for the uninsured and 
underinsured families. These services range from doctors' visits for 
newborns to specialized treatment for children with special health care 
needs. Most recent data indicate that MCH programs supported 
preventive, primary, and speciality services for:
  --Approximately 4.8 million women;
  --Almost 11.3 million infants, children and adolescents; and
  --Approximately 900,000 children with special health care needs.
    Beyond direct services, the program reaches a much wider population 
of women and children through population-based services. These services 
include sudden infant death syndrome (SIDS) education, injury 
prevention, lead poisoning prevention, outreach activities, and public 
education to encourage healthy behaviors. Many parents are familiar 
with the ``Back to Sleep Campaign'' aimed at preventing SIDS deaths 
that was developed in collaboration with the Maternal and Child Health 
Bureau, the National Institute of Child Health and Development, and the 
American Academy of Pediatrics. Using the message from this campaign, 
state MCH programs have conducted public education activities to 
educate parents about putting their babies to sleep on their backs. 
SIDS deaths have dropped substantially for the population as a whole, 
but more research needs to be done to determine why rates have not 
fallen as much for minority populations.
                               unmet need
Health status indicators
    The health of our Nation's pregnant women and children has improved 
dramatically over the last 50 years. Advancements in medical technology 
and improved access to care, have seen reduced in many adverse health 
outcomes including maternal and infant mortality rates; however, our 
nation still falls short of its goals, especially for underserved and 
minority populations. Since 1980, our infant mortality has dropped for 
both blacks and whites, but there is still a substantial gap between 
the two.
  --In 1980, the infant mortality rate for blacks was two times higher 
        than the white rate. Fifteen years later, this gap has widened. 
        In 1995, the black infant mortality rate was 2.4 times higher 
        than the white infant mortality rate.
    Another important indicator in child health is the number of babies 
born who are low birth weight. Low birth weight infants are at higher 
risk of death, long-term illness and disability than are babies of 
normal weight.
  --The percentage of low-birth weight infants in the United States 
        increased from 6.8 percent in 1980 to 7.3 percent in 1995.
    Clearly, the increase in low birth weight babies is going in the 
wrong direction. Although important health problems have been 
alleviated, many still threaten the health of women and children. 
Smoking rates for adolescents are going up; injuries remain the leading 
cause of death for children; and women and children are at increased 
risk for HIV/AIDs.
Children's health insurance implementation and remaining needs
    Last year, Congress took significant steps to address some of these 
health problems through passage of the State Children's Health 
Insurance Program. This health coverage expansion presents states with 
tremendous opportunities. During the current implementation stage, most 
state MCH programs have been working together with Medicaid agencies to 
figure out what is the best approach to serve the needs of uninsured 
children.
    The Congressional Budget Office estimated that the new law would 
cover 3.4 million uninsured children when it's fully implemented. Even 
if every one of these 3.4 million children is enrolled in public 
insurance programs, and even if the 3 million uninsured children who 
are eligible for Medicaid sign up for that program, there will remain 
millions of youngsters--3.6 million to be precise--with no health 
coverage whatsoever. These 3.6 million young children and adolescents 
will need the health services that MCH programs and other public health 
programs provide or they will have no professional health care at all.
    Although the State Children's Health Insurance Program fills a 
tremendous gap in coverage for many children, it does not cover all 
necessary services, or as I just mentioned, all populations. The new 
insurance initiative does not provide access to care, by which I mean 
transportation to clinics, and other services that bridge the gap 
between ``eligibility'' and actual service delivery. It does not 
provide services for uninsured pregnant women or for children with 
substandard insurance coverage. It does not cover comprehensive 
services for children with special health care needs.
    As a result, a significant number of pregnant women will still need 
prenatal care and related health services. Without adequate access to 
these services, pregnant women will be at risk of having babies that 
are low birth weight or have other serious and potentially long-term 
health problems. Underinsured children--including those with only 
catastrophic health coverage through a parent's policy--will still 
require access to well-baby and well-child check-ups and other 
preventive services provided by state MCH programs. Finally, the 
complex medical conditions of children with special health care needs 
will require additional care by pediatric specialists, and care 
coordination not likely to be covered by the new children's health 
initiative. It is estimated that 13.4 percent of low-income, insured 
families with disabled children had unmet health care needs in 1994. 
This figure is not likely to change with the expansion of the new 
health insurance program. Clearly, the needs of pregnant women and 
children, the underinsured, and children with disabilities must still 
be addressed by the MCH programs with or without health insurance 
expansion.
    Even as more children gain insurance coverage, MCH programs will 
continue to:
  --Ensure the availability of public and private providers in 
        underserved areas;
  --Support and coordinate services for children who have complex 
        medical conditions or disabilities;
  --Provide ``enabling services'' such as home visiting to detect any 
        health problems early on, and to teach parents how to prevent 
        childhood injuries; and
  --Get pregnant women and children into care through media campaigns, 
        toll-free hotlines and outreach workers that link them with 
        Medicaid, other insurance sources, and directly with providers.
                       funding formula/set-asides
    The MCH Block Grant is a permanently authorized discretionary 
federal grant program. Its current authorization level is $705 million; 
in fiscal year 1998, $683,000 million was appropriated for the program. 
Of this $683,000 million, $3 million was earmarked for the traumatic 
brain injury demonstration project and other initiatives. The 
Association of Maternal and Child Health Programs recommends that new 
initiatives such as the traumatic brain injury demonstration project, 
be funded separately in fiscal year 1999. For appropriations up to $600 
million, 85 percent of the appropriation is allocated to the states, 
and 15 percent is set-aside at the federal level for demonstration, 
research and training, and service projects. For appropriations 
exceeding $600 million, 1989 amendments created a second set-aside of 
12.75 percent to fund six types of demonstration projects: home 
visiting; provider participation; integrated service delivery; non-
profit hospital MCH centers; rural programs; and community projects for 
children with special health care needs. States match $3 for every $4 
Federal; many States provide additional funds. States must limit 
administrative costs to 10 percent; maintain state MCH funding levels 
at 1989 levels; and spend 30 percent of funds on preventive and primary 
care for children and adolescents, and 30 percent on services for 
children with special health care needs.
    The MCH Block Grant's two Ufederal discretionary programs or set-
asides: are the Special Projects of Regional and National Significance 
(SPRANS) program and the Community Integrated Service System (CISS) 
program. SPRANS grants are authorized as special projects that must 
respond to national needs and priorities, have regional or national 
significance, and demonstrate some way to improve State systems of care 
for mothers and children. SPRANS funds are reserved at the federal 
level for the purpose of supporting projects in five areas of research, 
training, hemophilia, genetic diseases, and maternal and child health 
improvement projects. SPRANS grants support technical assistance 
training and research policy development centers that work to build 
States' maternal and child health infrastructure and develop tools and 
information to help States improve the health status of pregnant women 
and children. While SPRANS grants focus on regional and national 
priorities, the CISS program targets communities through increasing the 
capacity for service delivery at the local level and fostering 
formation of comprehensive, integrated, community-level service systems 
for mothers and children.
    One example of the good use of Federal grants is child care. With 
three of every children under age 6 in some form of child care setting, 
it is vitally important that these settings be safe and healthy. To 
this end, the Maternal and Child Health Bureau awarded nearly all 
states a grant of $50,000 each as seed money to promote health and 
safety in child care settings. In North Carolina, the state has used 
this grant as part of a larger initiative, Smart Start, which is a 
public--private partnership involving businesses such as Glaxo--
Wellcome. The program promotes healthy child care by actually expanding 
access to health screenings and nutrition services onsite at child care 
settings, and educating child care workers about proper health and 
safety. If additional resources were available, states could make 
further improvements in the training of child care providers in the 
area of health and safety.
                         funding recommendation
    To maintain cost-effective, preventive public health services 
protecting all our nation's mothers and children, the Association of 
Maternal and Child Health Programs recommends an appropriation of $705 
million for the Maternal and Child Health Services Block Grant for 
fiscal year 1999. This modest request is approximately a 3-percent 
increase over fiscal year 1998. While AMCHP recognizes that there are 
limited federal resources, it should be noted that if the block grant's 
appropriation were to have kept pace with constant 1980 dollars, its 
funding level would now be approximately $730 million. With sufficient 
funding, this program can continue to play a vital role in improving 
the health status of all children and pregnant women.
                                 ______
                                 
  Prepared Statement of Patricia Franklin, MSN, RN, CPNP, President, 
  National Association of Pediatric Nurse Associates and Practitioners
    On behalf of the more than 5,500 members of the National 
Association of Pediatric Nurse Associates and Practitioners (NAPNAP), I 
appreciate the opportunity to provide the members of the subcommittee 
the views of the association and request that our statement be included 
in the record.
    Founded in 1973, NAPNAP is the largest nursing organization 
dedicated solely to improving the quality of health care of children 
from birth to the age of 21. Pediatric nurse practitioners (PNPs), are 
registered nurses with advanced education and training who provide 
health care services and have prescriptive authority in 49 states. The 
PNP has completed a program of nurse practitioner (NP) preparation 
usually offered in schools of nursing as part of the Masters in Nursing 
Degree Program.
    NP's were recognized in the Balanced Budget Act as a primary care 
providers and are now able to receive direct reimbursement from the 
Medicare program in all settings. Now more than ever, advanced practice 
nurses like PNPs are front line, point of contact providers of primary 
care services to an increasing number of Americans.
    PNP's deliver a broad range of health care services to children 
from birth to age 21--performing physical examinations, treating common 
childhood illnesses, coordinating care of chronic illnesses in 
children, and helping families meet other important health care needs. 
To support the increasing contributions PNPs make to the health care 
system, particularly in rural and medically underserved areas, NAPNAP 
requests your favorable consideration of spending levels for the 
following programs:
  --Nurse Education Act: $70.92 million;
  --National Institute of Nursing Research (NINR): $73.136 million; and
  --National Health Services Corps (NHSC): request that the committee 
        provide the appropriations necessary to assist the NHSC in 
        developing a site assessment tool to evaluate the workforce 
        needs of medically underserved areas and provide funding for 
        necessary health care providers.
                          nurse education act
    The Nurse Education Act (NEA) is the sole source of federal support 
for advanced practice nursing education. Advanced practice nurses 
(APNs) include nurse practitioners, certified nurse midwives, clinical 
nurse specialists, and certified registered nurse anesthetists. NAPNAP 
respectfully requests an 8 percent increase over fiscal year 1998 to a 
level of $70.92 million with proportionate increases appropriated to 
Sections 821 and 822, Advanced Nurse Education and Nurse Practitioner/
Nurse Midwives, respectively.
    APN's are in increasing demand in the health care market, and 
traditionally have filled the void of primary care physicians in rural 
and medically underserved areas. Increasing support for a diverse group 
of advanced practice nurses prepared as primary care providers will 
further the ability of the government and the profession to meet the 
health care needs of all Americans.
                national institute for nursing research
    The National Institute for Nursing Research (NINR) is one of the 
smallest NIH entities despite the growing responsibility of nurses, 
especially advanced practice nurses, for the primary care and case 
management of patients in all settings. In fiscal year 1998, NINR 
received a budget increase of 6.4 percent over fiscal year 1997, less 
than the 7.1 percent budget increase for the overall National 
Institutes for Health. To compensate for the disproportionate increase 
last year and in line with anticipated fiscal year 1999 NIH spending, 
we respectfully request that the subcommittee endorse a 15 percent 
increase in the NINR budget, commensurate with NIH funding levels.
    This increase would provide funding sufficient to empower NINR 
researchers to explore the vast complexities of ``end-of-life'' care; a 
research area for which NINR was identified as the lead institute. End-
of-life care involves the synthesis of complex care, pain management, 
and mental health services for patients and their families. 
Furthermore, NINR represents the largest health care profession--
nursing--whose research agenda encompasses breakthrough developments in 
patient care, outcomes, and cost effectiveness; avoiding low birth 
weight babies; and maximizing the quality of life of people living with 
chronic conditions, a population which will grow as the baby boom 
generation ages.
                     national health services corps
    The National Health Services Corps (NHSC) has traditionally 
provided the funding necessary to bring vital health care to rural and 
medically underserved areas. At present, there are 146 counties without 
a physician, more than 50 percent of which are being served by a NP or 
a physician assistant (PA). NHSC funding makes this possible; however 
there are still approximately seventy counties not served by either a 
physician, NP, or PA.
    Furthermore, NAPNAP has grave concerns regarding a shift in the 
National Health Service Corps policy on the placement of NPs in 
underserved areas. Traditionally, the program has paid for both family 
nurse practitioners and pediatric nurse practitioners; however in 1997, 
NHSC moved to eliminate PNPs from consideration for NHSC scholarships 
without any assessment mechanism as to whether this best meets the 
needs of the communities. We strongly urge the committee to direct the 
NHSC to develop a site assessment tool which assesses the resident 
characteristics of a community and then provide the appropriate health 
professional to meet those needs. Without this, the NHSC is left making 
arbitrary determinations about the providers placed in underserved 
areas--a disservice to all involved.
    On behalf of NAPNAP, I thank the committee for this opportunity to 
present our views on the vital funding of nursing programs. We look 
forward to working with you through the appropriations process and 
welcome any questions, comments, or concerns you might have. Please do 
not hesitate to call me should you desire additional information or 
have further questions.
                                 ______
                                 
   Prepared Statement of the American College of Emergency Physicians
    The American College of Emergency Physicians (ACEP) wishes to thank 
the Labor, Health and Human Services, and Education Subcommittee of the 
Senate Appropriations Committee for the opportunity to present its 
views concerning implementation of a resource-based practice expense 
payment system.
    ACEP is a medical specialty society representing over 19,600 
emergency physicians. Emergency medicine is practiced as patient-
demanded, broadly available, and continuously accessible care by 
physicians educated to engage in the recognition, stabilization, 
evaluation, treatment, and disposition of patients in response to 
unexpected illness and injury. The patient population is unrestricted 
and presents with a full spectrum of episodic undifferentiated physical 
and behavioral conditions.
    ACEP supported the provisions enacted as part of the ``Balanced 
Budget Act of 1997'' (BBA) to delay the implementation of the new 
practice expense system and redirect the Health Care Financing 
Administration's (HCFA) efforts in devising the new system. ACEP also 
appreciates the oversight that the Subcommittee is providing on this 
issue in the hearing on March 10, 1998.
    As the Subcommittee is well aware, due to concerns that HCFA's June 
1997 proposed rule was based upon a flawed methodology, the BBA 
required HCFA to restudy the issue, taking into account ``generally 
accepted cost accounting principles which (i) recognize all staff, 
equipment, supplies, and expenses, not just those that can be tied to 
specific procedures, and (ii) use actual data on equipment utilization 
and other key assumptions.''
    However, ACEP is concerned that despite this new Congressional 
directive, HCFA continues to depend upon a methodology and data that 
pre-date the enactment of the BBA and which are not based upon 
generally accepted cost accounting principles and do not utilize actual 
data. It is difficult for the College to understand how continuing on 
this path will comply with the requirements of the BBA.
    The way is which HCFA calculates and allocates indirect practice 
expense is an especially important issue for emergency medicine 
because, as a hospital-based specialty, a substantial proportion of the 
specialty's practice costs are indirect in nature. However, after 
reviewing the June 1997 proposed rule and based upon HCFA's subsequent 
actions, the College believes that the way in which HCFA has chosen to 
measure and allocate indirect practice costs is seriously flawed.
    For the practice of emergency medicine, this raises significant 
concerns with respect to two categories of expense. These are 
uncompensated care costs and readiness costs.
Uncompensated care
    To accurately and fairly determine the level of practice expense 
for emergency physicians, it is essential that any new rule recognize 
certain aspects of emergency medicine, such as the cost of 
uncompensated care.
    For the practice of emergency physicians, uncompensated care is a 
significant portion of indirect practice costs. This cost becomes even 
more significant in light of the fact that, in 1986, Congress passed 
the ``Emergency Medical Treatment and Labor Act'' (EMTALA), often 
referred to as the Federal ``antidumping'' law (section 1867 of the 
Social Security Act). Under EMTALA, emergency physicians are required 
to provide services to all persons who seek care in the emergency 
department, regardless of their insurance status or ability to pay.
    As a direct result of this federal mandate, a substantial portion 
of the services provided by emergency physicians are never reimbursed. 
This federal mandate applies only to the practice of emergency medicine 
and is vigorously enforced through HCFA and the Medicare law. Violation 
of EMTALA can result in $50,000 fines for the physician and expulsion 
from the Medicare and Medicaid programs. As such, emergency physicians 
practice under a Federal requirement to provide significant amounts of 
uncompensated care to patients and face stiff penalties if they fail to 
do so.
    The irony is that while HCFA oversees enforcement of EMTALA, 
resulting in high levels of uncompensated care for emergency 
physicians, HCFA has historically refused to consider this cost as a 
legitimate practice expense that Medicare should reimburse. Although 
ACEP supports the tenets of EMTALA and has always been dedicated to 
providing access to care for all those who seek it, HCFA should 
recognize that there is a financial consequence to sustaining this 
level of care.
    All available evidence suggests that uncompensated care in the 
emergency department is large and growing. The 1996 National Hospital 
Ambulatory Medical Care Survey, conducted by the National Center for 
Health Statistics (NCHS), estimates that 16.8 percent of all visits to 
the emergency department are ``self-pay'', a term that reflects the 
uninsured population and usually results in no payment. In the same 
study, the NCHS estimates that Medicaid patients make up about 22 
percent of the emergency department case mix. As any emergency 
physician will tell you, State Medicaid payment rates are, for the most 
part, unreasonably low, and often do not even cover the cost of 
providing care to Medicaid recipients.
    Anecdotal reports from emergency physicians indicate that 
uncompensated care may account for between 20 and 50 percent of the 
physician workload, depending on where the physicians practice. 
Furthermore, the growth of managed care, both in public programs, such 
as Medicaid, and in the private sector, has led to increased levels of 
uncompensated care and under-compensated care, with virtually no means 
by which to shift the costs of such care to other payers.
    As HCFA considers a new proposed rule to implement the resource-
based practice expense system, ACEP strongly urges the agency and 
Congress to take into account the costs of uncompensated care.
Readiness costs
    Emergency physicians are required to be available on a 24-hour a 
day, 7 days a week basis. Patients with a variety of injuries and 
illnesses arrive in the hospital emergency departments at any time of 
day or night. There is a value to the community and the nation in 
maintaining these readiness capabilities. As a result of the 
unscheduled nature of emergency medicine, emergency physicians may 
spend a portion of their time in an ``availability'' or ``readiness'' 
status awaiting the arrival of patients.
    There is substantial economic costs involved in maintaining 
emergency physician resources on a 24-hour a day basis. Any practice 
expense approach that pays on an average per-case basis and fails to 
recognize this unscheduled demand for services is problematic for the 
practice of emergency medicine, particularly in low volume emergency 
departments, such as rural areas. The College is increasingly concerned 
that HCFA does not currently recognize these costs in calculating 
Medicare work values or practice expense values.
    As with the costs of uncompensated care, ACEP urges HCFA and 
Congress to recognize ``readiness'' costs in determining the new 
practice expense payment system.
Conclusion
    Emergency physicians are dedicated to providing access to emergency 
services for all populations, regardless of culture, background, 
economic status, or ability to pay. However, by mandating through 
EMTALA that emergency physicians and hospitals provide emergency care 
24 hours a day, 7 days a week, Congress also determined that such 
access should be the law of the land. As a result, both uncompensated 
care and ``readiness'' costs are legitimate components of emergency 
physician practice expense and should be incorporated into HCFA's 
practice expense methodology. These costs help ensure that high quality 
emergency medical services are available whenever the need arises.
    In sum, ACEP appreciates the opportunity to present our views on 
this important issue. The College would be pleased to work with the 
Subcommittee and HCFA to ensure that the new proposed rule accurately 
and fully recognizes the costs associated with the practice of 
emergency medicine.
                                 ______
                                 
  Prepared Statement of Ronny B. Lancaster, M.B.A., J.D., President, 
           Association of Minority Health Professions Schools
    Mr. Chairman, thank you very much for the opportunity to present 
the views of the Association of Minority Health Professions Schools 
(AMHPS) regarding fiscal year 1999 appropriations for the Departments 
of Labor, Health and Human Services, Education and Related Agencies. I 
am Ronny Lancaster, Senior Vice President for Management and Policy at 
Morehouse School of Medicine, and President of AMHPS.
    I would like to begin my statement by thanking this subcommittee 
for its past support of programs which assist AMHPS institutions. In 
particular, we very much appreciate the leadership of Chairman Specter.
    AMHPS is an organization which represents 12 historically black 
health professions schools in the country. Combined, our institutions 
have graduated 60 percent of all the nation's African-American 
pharmacists, 50 percent of African-American physicians and dentists, 
and 75 percent of the African-American veterinarians. Our 12 schools 
are becoming even more ethnically and culturally diverse in terms of 
Hispanic students and Native American students, and most of these 
students and graduates matriculate from and are working in the nation's 
underserved rural and inner-city communities.
    While African-Americans represent approximately 12 percent of the 
U.S. population, only 2-3 percent of the nation's health professions 
workforce is African-American. Studies have demonstrated that when 
African-Americans and other minorities are trained in these 
institutions, they are much more likely to serve in medically 
underserved areas, more likely to take care of other minorities and 
more likely to accept patients who are Medicaid recipients or otherwise 
poor. For this reason, it is imperative that the federal commitment to 
training African-Americans and other minorities in the health 
professions remain strong. Clearly, institutions which train 
disproportionately high numbers of minorities address an important 
national need.
    In spite of our proven success in training minority health 
professionals, our institutions endure a financial struggle that is 
inherent in our missions to train disadvantaged individuals to serve in 
underserved areas. The financial plight of the majority of our students 
has affected our schools in numerous ways, such that we are not able to 
depend on tuition as a means by which to respond to the discontinuation 
of funding or other forms of federal support for health professionals 
education. Additionally, due to the fact that the patient populations 
served by the AMHPS institutions have historically been poor, our 
institutions have not earned money from the process of patient care at 
the time when the average medical school gets 40 to 60 percent of its 
operating revenue from patient care.
                specific key programs supported by amhps
Health professions/disadvantaged minority training
    The health professions programs supported by this subcommittee are 
the only Federal initiatives that are designed to deal with 
acknowledged health personnel shortages among diverse populations and 
in geographic areas.
    The Minority Centers of Excellence Initiative, the Health Career 
Opportunity Program, Scholarships for Disadvantaged Students, and other 
health professions programs recognize and support the institutions that 
have a mission, commitment and record to addressing those shortages. 
The support provided for the Centers of Excellence program, represents, 
very frankly, the difference between keeping the doors open or closed 
at several historically minority health professions schools.
    Our schools and students appreciate the support of this 
subcommittee in restoring funding for health professions programs in 
last year's bill. It is our hope that the President's budget proposal 
for fiscal year 1999 is more favorable than it was last year. Health 
professions organizations, including AMHPS, are recommending $306 
million for fiscal year 1999 for health professions training.
    Our association is also encouraging members of this subcommittee to 
review and co-sponsor H.R. 1895, the Disadvantaged Minority Health 
Improvement Amendments introduced by Congressman Stokes. H.R. 1895 
would reauthorize many of the important health professions training 
programs, and its passage this year is critical.
National Institutes of Health
    The historically minority institutions which I represent today are 
committed to narrowing the health status gap among minorities when 
compared to the general population. Our institutions can achieve this 
national goal by improving our research capabilities through continued 
development of our research labs, faculty improvement, and other 
learning resources. Three programs specifically address developing the 
research infrastructure at our institutions:
    The Research Centers at Minority Institutions program at the 
National Center for Research Resources (NCRR) is helping us develop the 
research capability to solve health problems disproportionately 
impacting minorities. Funding for this program should grow at the same 
rate as NIH overall.
    Second, the Extramural Facility Construction program at NCRR can 
help our schools catch up to our non-minority counterpart institutions 
by providing us the resources to build adequate research facilities. 
The subcommittee is urged to provide $30 million for fiscal year 1999 
for this program.
    Third, the Minority Health Initiative and the Office of Research on 
Minority Health at NIH each support critical specific disease related 
research initiatives through the various NIH institutes. We recommend a 
combined funding level of $80 million for these programs in fiscal year 
1999.
    Almost every health professions training and research institution 
in this country was built and developed with a significant contribution 
from federal sources. At this stage in our development, minority 
institutions are prepared to accept and hereby request this same kind 
of support.
    Mr. Chairman, as this subcommittee contemplates a significant 
increase in the budget for the National Institutes of Health, we 
believe that an unprecedented opportunity exists to provide the 
research and infrastructure building support that is necessary to allow 
our historically minority institutions to conduct research on equal 
footing with our sister majority institutions. We are recommending the 
establishment of a $1 billion research endowment initiative at NIH, 
focused on those individuals and institutions which have a historic 
commitment to studying and improving minority health status. The 
purpose of this initiative is to establish research endowments in 
minority institutions to ensure excellence and continuity in our 
research efforts.
Centers for Disease Control and Prevention
    Minority populations of all ethnic backgrounds are at significantly 
increased risk of infectious disease, low birth weight, Hepatitis B. 
sexually transmitted diseases, tuberculosis, and other chronic 
disorders.
    The Centers for Disease Control has taken a leadership role in 
combating these problems by supporting initiatives to control 
infectious and chronic diseases among disadvantaged minority 
populations through CDC's plan, ``Addressing Emerging Infectious 
Disease Threats: A Preventative Strategy for the United States''. With 
additional resources, CDC could begin to support community-based 
infectious disease prevention programs in each State.
    Because of the proximity of minority health professions 
institutions to disadvantaged, medically underserved communities, CDC 
can and does play a leadership role in supporting disease prevention 
and public health education activities in partnerships with our 
institutions.
    Our overall funding recommendation for CDC for fiscal year 1999 is 
$2.8 billion.
HHS Office of Minority Health
    The HHS Office of Minority Health (OMH) has the critical role of 
trying to ensure that all Public Health Service agencies are focusing 
appropriate resources on improving minority health status in this 
nation. Although their task is daunting, progress has been made as a 
result of OMH leadership.
    The OMH is assisting our institutional adjustment to the managed 
care environment by supporting a comprehensive study entitled Securing 
the Future of Minority Health
    Professions Schools. The study is analyzing the challenges and 
capabilities of each of our institutions, and offering recommendations 
to our schools to better compete as patient care entities and as 
academic health centers.
    To continue this study in fiscal year 1999, we are recommending 
additional funding of $1.5 million for the HHS Office of Minority 
Health.
Strengthening historically black graduate institutions/higher education
    The Strengthening Historically Black Graduate Institutions, Title 
III, Part B. Section 326 is a program of extreme importance to AMHPS 
schools. This program allows historically black graduate institutions, 
including those represented by AMHPS to participate in the Part B 
programs for strengthening our schools. The funding from this program 
is utilized by our institutions to establish and strengthen development 
offices, to begin endowment development campaigns (a definite need of 
all HBCU's), and to enhance our educational capabilities on the 
graduate level.
    The Higher Education Act Reauthorization added 11 Historically 
Black Graduate and Professional Schools to Section 326 of Title III, 
making 16 schools eligible for this funding. In order to accommodate 
the growth at these new schools and continue the progress being made at 
existing schools, increased funding is a necessity in the fiscal year 
1999 appropriation for this program. A funding level of $30 million is 
necessary to accommodate the growth of the grant level at each of the 
Section 326 schools.
Closing
    Mr. Chairman, please allow me to offer our sincere appreciation to 
you and the members of this subcommittee for the support you have 
provided for our institutions and our students. With congressionally 
funded programs for minority health and health professions education, 
we can overcome the disparity in health care in this country. We must 
be careful not to eliminate, paralyze or strangle the programs that 
have proven to work. There are success stories, but not enough of them. 
The lack of participation by minorities in medicine and the sciences is 
characteristic of a long-term, complex, multi-faceted set of variables 
which will require a sustained, vigorous, and visionary commitment from 
our high schools, colleges, medical schools, and support 
organizations--and from this subcommittee and the entire Congress.
    Once again, thank you for allowing our association the opportunity 
to present our views.
                                 ______
                                 
Prepared Statement of Jannine D. Cody, Ph.D., President, the Chromosome 
                    18 Registry and Research Society
    Thank you for allowing me this opportunity to share some of our 
concerns with you.
    My name is Jannine Cody. I am the founder and President of the 
Chromosome 18 Registry and Research Society, a support group for 
families affected by chromosome 18 abnormalities. I live in San 
Antonio, Texas. I am accompanied by members of our Board of Directors 
from Chicago and Detroit as well as some of our families who live in 
the DC area.
    We are asking you to reevaluate the NIH funding priorities. 
Nationally, in our fervor to alleviate suffering and to insure a long 
and healthy life, we have ignored our most needy and vulnerable 
citizens. We have focused our medical research efforts on prolonging 
the end of life without equal commitment to giving people with mental 
retardation and developmental disabilities a complete life. A life of 
dreams and promise. A life of independence instead of dependence.
    Thirteen years ago, my daughter Elizabeth was born with a severe 
cleft palate and cleft lip and foot abnormalities. A blood test 
revealed that these problems were caused by a chromosome abnormality 
called 18q-. This is a mental retardation syndrome caused by a missing 
portion from the long arm of chromosome 18.
    The pediatrician gave us a photocopy from a medical textbook which 
made the following observation about kids with 18q-. ``They are 
probably the most severely afflicted among carriers of chromosomal 
abnormalities. They maintain the froglike position observed in infants 
and are reduced to an entirely vegetative, bedridden life.''
    As you can imagine this was devastating news. Especially since she 
seemed so bright and alert. This information was accompanied by a long 
list of other possible congenital deformities associated with the 
syndrome. There was VERY LITTLE information about functional 
development such as growth, motor skills and hearing. There was NO 
information about increased risk for later onset conditions.
    For us, our most immediate concern was repair of her cleft lip and 
palate. To date, she has had 12 surgeries and is about at the half-way 
point in the repair process. However, her first 4 surgeries, all before 
age 3, were all complicated by her failure to heal properly. We now 
know that her healing problems were caused by growth hormone deficiency 
which also causes short stature.. The 8 surgeries she has had since 
being on growth hormone replacement therapy have healed perfectly. She 
has had to face numerous surgeries to repair the complications 
resulting from her early failed surgeries because no one ever asked the 
simple question, ``Why are kids with 18q- short?''.
    Because of Elizabeth, growth hormone deficiency is now known to be 
a common feature of the 18q- syndrome. And hopefully no future child 
will have to endure the pain and trauma of unnecessary surgery and 
abnormal scarring.
    It was this finding in my daughter that spurred me to find other 
parents and to see that research is done to determine the nature of our 
children's problems. I started The Chromosome 18 Registry & Research 
Society in an effort to bring families together who are affected by 
chromosome 18 abnormalities. In order to insure that the research done 
on these syndromes is clinically relevant and is translated into 
patient useful information, I earned a Ph.D., in human genetics working 
on the 18q- syndrome. Our goal is to find treatments and not just 
supportive care for our children.
    Today, my husband and I are trying to understand why two bone 
grafts to create a continuous gum line have failed. Why the bones in 
her feet are grown together. What can we do about her dyslexia? In 
spite of these many obstacles, Elizabeth is now in a hearing impaired 
7th grade and her teacher says she is a whiz at history and science. 
Not exactly the vegetable that was predicted.
    This might be my personal story, but the stories of any of our over 
700 families are as equally compelling and frustrating.
    18q- is only one of many types of chromosome abnormalities. These 
abnormalities are a leading cause of birth defects because chromosomes 
play a central role in controlling the cells that make up our body. 
Chromosomes are the packages of hereditary material that are in every 
cell of the body and are passed from one generation to the next. 
Individuals with Down syndrome have three instead of two copies of 
chromosome 21. There are many other chromosome abnormalities which can 
involve all or only a part of any of the 23 pairs of chromosomes. 
Almost anything you could do to a picture of chromosomes with scissors 
and glue could really happen, but few are compatible with life.
    The majority of people with chromosome 18 abnormalities have one of 
5 different syndromes. A missing piece from the long arm of the 
chromosome is called 18q-, which my daughter Elizabeth has. A missing 
piece from the short arm is called 18p-. The chromosome can form a ring 
causing the loss of chromosomal material form both ends of the 
chromosome and is called Ring 18. Individuals can have an extra copy of 
chromosome 18 which is called Trisomy 18. An even more unusual 
rearrangement can result in an extra chromosome 18 which is composed of 
2 short arms, giving the individual a total of 4 copies of the short 
arm. This is called Tetrasomy 18p.
    These abnormalities can happen to anyone. There is no known ethnic 
bias. There are no know causes such as exposure to radiation or 
chemicals, before or during pregnancy. There is no way to protect your 
family. It could happen to anyone and it often does. Fifty percent of 
conceptions are thought to have chromosome abnormalities. However, 90 
percent of those with abnormalities do not even implant in the uterus 
and become a recognized pregnancy. Of those embryos that are viable 
through early pregnancy the vast majority are miscarried. The 
abnormalities of chromosome 18 are probably some of the most common 
because they are more compatible with life. Babies conceived with a 
chromosome 18 abnormality are more likely to survive long enough to be 
born.
    Many other parent support groups have information about the growth 
and development of their children. They have growth charts so that 
parents can see how their child is growing in comparison with other 
children with that same syndrome. Here is the growth chart for kids 
with chromosome 18 abnormalities. It is a normal growth chart. We will 
not settle for less than average, less than normal. If our kids are 
failing to grow normally, we intend to find out why and to fix it. 
Palliative and supportive therapy is not enough. We are determined to 
understand our kids problems and then to solve them, not to merely 
ameliorate them.
    We have been extremely fortunate to have found a group of 
researchers who have had the vision to see that these are 
scientifically interesting syndromes. These syndromes are medically 
uncharted territory. These are syndromes that the age of molecular 
biology can make understandable. This is a opportunity to make a 
dramatic difference in the lives of many families.
    One of our main organizational goals is to establish a Chromosome 
18 Clinical Research Center. We thought that if we could provide money 
to gather preliminary data on the study of each of the syndromes, then 
these projects could move on to be Federally funded. We would just have 
to get the ball rolling. Our families have invested more than $700,000 
to generate preliminary results and this has still not been enough. It 
has not been enough because the pot of NIH money available to study 
these syndromes in the mental retardation branch of the NICHD is 
disproportionately small. It is disproportionately small compared to 
the number of people affected by mental retardation and 
disproportionately small compared to the proportion of mental 
retardation caused by chromosome abnormalities.
    As a nation, we have focused so intensively on adult onset 
conditions that we have not given adequate attention to those who have 
not been given the chance to grow into productive adults, to make adult 
choices and have adult dreams and aspirations. In 1996, 32 percent of 
the population was children and adolescents, yet only 14 percent of 
direct NIH funding was for pediatric research (1). Children's medical 
research needs have been unmet.
    Compounded by that problem, seven and a half million Americans have 
mental retardation (2) representing 3 percent of the population (3). 
For fiscal year 1996, 3 percent of the NIH budget was 357 million , yet 
in that year only 86.3 million dollars were spent on mental retardation 
research by NICHD. One quarter of what should be spent based on 
population numbers alone.
    However, population numbers alone should not determine the 
budgetary level of importance. The burden to society must be considered 
as well as scientific opportunity.
    Individuals with development disability and mental retardation 
create an indisputable burden to society, not just in terms of health 
care but in special educational needs and in lifelong dependency. Money 
spent to cure these problems would be an investment in the future and 
potential of these individuals, and their caregivers, as well as an 
investment in the future of the nation as a whole.
    Chromosome abnormalities represent a significant clinical and 
social burden. The very nature of chromosome abnormalities means that 
multiple body systems are affected. Individuals with chromosome 
abnormalities usually require many medical interventions, not to 
mention many supportive therapies such as physical, occupational and 
speech therapy. This places a burden on families that is often 
overwhelming. One parent may have to give up a job in order to meet the 
appointments of all the different medical specialists and therapists. 
The other parent is often locked into the same job for fear of losing 
health insurance. This is a recipe for stress, and 22,000 families join 
these ranks each and every year.
    Scientific opportunity does not magically appear, it is bought. The 
Human Genome Project has bought us the advances necessary to begin to 
understand and to ultimately treat many human disease including mental 
retardation. Yet there is proportionately little clinical research on 
mental retardation or chromosome abnormalities.
    Since 50 percent of mental retardation is caused by chromosome 
abnormalities and chromosome abnormalities have a defined genetic 
etiology they are the logical starting place for unraveling the 
mysteries of learning differences and mental retardation. The study of 
chromosome abnormalities could open many new vistas in cognitive 
neuroscience.
    What we need is for you to realize that by studying chromosome 
abnormalities you would not just be helping our families, but you would 
be opening the door to understanding mental retardation and 
developmental disabilities. Chromosome abnormalities can serve as the 
key to understanding mental retardation and fulfilling the promise of 
the Human Genome Project which has provided us with the scientific 
opportunity.
    You would be giving people back not just the end of their life but 
an entire life. A productive life. A life of independence instead of 
dependence. We have declared war on cancer so that adults might live a 
little longer. Now lets declare war on mental retardation so that 
children might have a full life.
    With the promise of increased NIH funding in the air, please 
consider directing those funding increases in ways which will equalize 
research for the currently under-served populations such as those with 
mental retardation and chromosome abnormalities. These are areas of 
research which have great scientific promise, in a field in which there 
is currently little expenditure. These syndromes carry a significant 
social burden with life-long health-care and entitlement costs.
    References:
    1. A May 7, 1996 letter to Representative John Porter from 
Representative James Moran.
    2. President's Committee on Mental Retardation, Fact sheet
    3. Introduction to Mental Retardation, The ARC, September 1993.
                                 ______
                                 
 Prepared Statement of Wadi N. Suki, M.D., President, American Society 
                             of Nephrology
                              introduction
    Mr. Chairman and distinguished Members of the Subcommittee, my name 
is Wadi N. Suki, M.D., and I am the President of the American Society 
of Nephrology (ASN), the national organization representing 6,500 
physicians and researchers who are committed to finding cures for 
kidney disease. On behalf of the ASN, I would like to thank you for 
this opportunity to testify before you in support of the National 
Institutes of Health (NIH) and specifically the National Institute of 
Diabetes, Digestive, and Kidney Diseases (NIDDK), which provides 
funding for most of the kidney disease research in the United States.
               esrd patient population continues to grow
    Although recent data suggests that the United States is possibly 
seeing some reduction in the growth of new end stage renal disease 
(ESRD) patients, the number of individuals being treated for ESRD grew 
steadily between 1986 and 1993. Since 1993, the rate of increase is 
down to 7 percent from the 9-10 percent levels that were experienced 
for most of the pre-1993 era.
    Between 1986 and 1995, the number of patients in this country with 
ESRD, that is total kidney failure, has more than doubled from 114,188 
to 257,266. During 1995 alone, a total of 68,870 patients were reported 
as being newly treated for ESRD in the United States. Chairman Porter, 
in your state of Illinois, the number of people undergoing therapy for 
ESRD has doubled over ten years from 5,813 in 1986 to 12,285 patients 
in 1995. In Mr. Obey's state of Wisconsin, the number of patients 
undergoing treatment for ESRD increased from 1,939 to 4,649 over that 
same period. In Mr. Istook's state of Oklahoma, the patient population 
receiving therapy for ESRD grew from 1,100 in 1986 to 2,865 in 1995. 
For your review, I have attached a table to my statement that outlines 
the dramatic rate of increase of people receiving therapy for end stage 
renal disease in each state.
    In terms of survival, the expected remaining years of life or life 
expectancies for U.S. ESRD patient groups is on average one-half to 
one-sixth of the normal life expectancy. In lay persons terms, if you 
are diagnosed with ESRD, you will die sooner.
What causes ESRD
    The causes of ESRD are diabetes, hypertension, glomerulonephritis, 
and polycystic kidney disease. Hypertension and diabetes affect 
minorities disproportionately, thus accounting for the higher incidence 
of ESRD in the minority population. Diabetes is the most common cause 
of kidney failure in Native Americans, and it leads to kidney failure 
more often in women than in men. ESRD continues to be a disease that 
affects African Americans and Native Americans at a rate 3 to 5 times 
the rate of White Americans. ESRD remains very expensive to treat both 
on a per patient basis and a program basis. The medical, social, and 
financial implications of this disease continue to make ESRD a major 
public health and public policy problem for our country.
Direct cost of ESRD to the Nation
    In 1995, the total spending for ESRD treatment in the United States 
was an estimated $13.1 billion. This includes Medicare payments of $9.7 
billion, $2.2 billion for Medicare patients' obligations, and an 
additional 0.98 billion for non-Medicare patients. In 1995, the average 
Medicare spending per patient/per year at risk was $40,000 for ESRD.
    Current data shows that the growth in the number of ESRD patients 
remains the primary driver of increased total spending. Between 1991 
and 1995, the rate of increase in spending per patient year was only 
1.1 percent. Depending on which Consumer Price Index (CPI) is used, the 
rate of increase in real spending per patient year was either or minus 
2 percent. As a result, spending per patient year has either remained 
constant or has decreased in recent years.
    Although the cost to the Federal Government per ESRD patient has 
remained relatively neutral, the number of patients requiring treatment 
for ESRD continues to grow. In recent years, the total funding at NIH 
for kidney disease research has been a little more than two percent of 
this country's direct cost to treat ESRD. Most of this funding went to 
the National Institute of Diabetes, Digestive, and Kidney Diseases 
(NIDDK). This is a very small percentage, yet it is my view and the 
view of the members of the American Society of Nephrology that an 
investment in research is the only real opportunity we have to reduce 
the enormous Medicare costs and human suffering imposed by ESRD.
Advances in research
    Nephrology research is currently addressing many issues that affect 
patients with kidney disease. We are defining the best dialysis 
regimens in patients with ESRD. In experimental animals, we are 
exploring treatments to prevent or shorten the course of acute renal 
failure. We have also cloned the gene responsible for polycystic kidney 
disease and are now studying the protein to determine how it causes 
this disease. Genetic defects in other familial diseases have also been 
identified. Hopefully, these discoveries will lead to new treatments 
and preventions.
    Research is also addressing the mechanisms by which 
glomerulonephritis is induced, with the hope that this will lead to 
strategies for prevention. Antibodies against certain inflammatory 
proteins can arrest experimental focuses of glomerulonephritis. Soon 
this strategy will have to be tested in man.
    Medical research, made possible largely through Congressional 
support, has given the men, women, and children who suffer from chronic 
renal failure hope. Thirty-five years ago, ESRD patients died. Dialysis 
technology was in its infancy, available only for patients with acute 
reversible rather than total permanent renal failure. Kidney 
transplants were only a dream.
    Since then, millions of Americans have benefited from dialysis or 
kidney transplants. However, while treatment often prolongs life, ESRD 
remains a serious medical condition. There is a misconception that the 
dialysis patient is able to live a full, active life. Sadly, that is 
not the case.
    Dialysis does not simply mean being hooked up to a machine 4 hours 
a day, three times a week. Dialysis patients commonly suffer bouts of 
anemia, nausea, fatigue, low blood pressure, chills, and itching (due 
to impurities in the blood). The body has difficulty adjusting to the 
frequent changes in toxicity levels, as toxins are removed and then 
build back up prior to the next dialysis. Many patients suffer 
depression, due to feelings of vulnerability and illness.
    Children with chronic renal diseases present medical challenges not 
usually seen in adults. Children undergo continued somatic, mental and 
psychological maturation even in the face of ESRD. Therefore, an 
understanding of how these issues of normal development interact with 
chronic renal disease in the production of abnormal growth and 
development is the highest priority.
    Basic animal research led to clinical studies that have now 
established that the progression of chronic renal disease can be 
substantially slowed by: (1) treatment of blood pressure to normal 
levels; (2) use of specific types of anti-hypertensive drugs, that have 
kidney-protecting effects in addition to their action to lower blood 
pressure; and (3) dietary protein restriction. These approaches may 
well be responsible for the recently noted slowing in the rate of 
growth of ESRD in the U.S.
    Fifteen years of NIH-supported research established the role of 
increased blood pressure in the kidney itself as an important cause of 
the loss of kidney function. These findings stimulated a clinical trial 
that demonstrated that captopril, a drug that lowers blood pressure in 
the kidney, could also reduce the progression of diabetic kidney 
disease by about 50 percent, a finding that will save the Medicare 
program an estimated $2.6 billion over the next 10 years. More clinical 
trials of this nature are needed.
    Additionally, decreasing the anemia that accompanies chronic renal 
failure by the use of erythropoietin has been shown to reduce the 
incidence of heart failure in dialysis patients; increase the patient's 
sense of well being and exercise tolerance, as well as, improve their 
overall quality of life. Heart disease is the main cause of death in 
such patients.
    Despite the progress we have made and the possibilities on the 
horizon, the mortality rate for ESRD patients is still very high. 
Approximately 50 percent of dialysis patients die within a few years 
after they begin treatment. The life expectancy of a 49-year-old ESRD 
patient is less than seven years, compared to 30 years for a healthy 
49-year-old American.
From bench to bedside
    Although solid basic research in the field of Nephrology has led to 
new discoveries in the prevention, diagnosis and treatment of kidney 
disease, more needs to be done in the area of clinical trials, studies 
and translational research (e.g., epidemiology, long-term longitudinal 
studies). Advances in understanding the mechanism of kidney disease and 
the discoveries of ways of arresting or modifying experimental kidney 
diseases will by necessity lead to the need to examine these strategies 
in patients with clinical kidney disease. This will create a need for 
professionals trained in the proper conduct, design, and analysis of 
data for clinical trials. There is also a need for properly trained 
officials to conduct longitudinal observation studies to better 
understand the natural history of kidney diseases. Funds will be 
necessary for training these individuals and for their research 
following the completion of training. In order to truly understand, 
diagnose, treat and hopefully cure kidney disease, it is imperative 
that we make a training investment in bio-staticians, clinical experts, 
and epidemiologists.
    At present, there is only a modest level of clinical trials and 
trained investigators working to translate new discoveries and 
information into cures for kidney disease. As with other disease 
institutes, a cadre of clinical investigators need to be funded and 
properly trained on how to conduct clinical trials and translational 
research to take basic discoveries to the next level in finding a cure 
for kidney disease.
    Although some funding does exist to train clinical investigators in 
the field of Nephrology research, additional resources are imperative 
if we are to be serious in combating this devastating disease. Without 
such an effort, kidney disease will continue to ravage this country.
ASN request for fiscal year 1999
    The ASN is hopeful that a doubling of the NIH budget over the next 
5 years, as called for in several pieces of legislation currently 
pending before Congress, can be achieved, and the ASN looks forward to 
working with each member of this Subcommittee and its Senate 
counterpart to accomplish this goal. For 1999, ASN feels strongly that 
this Subcommittee should approve a 15-percent increase above the 1998 
level the NIH, as recommended by the Ad-hoc Coalition for Biomedical 
Research.
    More specifically, for NIDDK and kidney research, ASN feels 
strongly that a 15-percent increase over the 1998 level is also 
appropriate if we are to be serious and move forward in eradicating 
kidney disease. Given the cost to human life and to the Federal 
Government caused by ESRD specifically, and of all the diseases for 
which research dollars are provided by the NIDDK, we urge this 
Subcommittee to provide a 15-percent increase.
    Mr. Chairman, members of the Subcommittee, as President of ASN and 
as a representative to the Council of American Kidney Societies, I 
thank you for this opportunity and for your consideration of our 
request. That concludes my statement and I am prepared to answer any 
questions that you or other members of the Subcommittee may have.
                                 ______
                                 
  Prepared Statement of Dr. John F. Neylan, President-Elect, American 
                    Society of Transplant Physicians
    Mr. Chairman and Members of the Subcommittee, thank you for the 
opportunity to present testimony on behalf of the American Society of 
Transplant Physicians (ASTP).
    I am John F. Neylan, M.D., Associate Professor of Medicine and 
Medical Director of the Renal Transplantation Program, at Emory 
University Hospital and I am President-Elect of the American Society of 
Transplant Physicians (ASTP). The ASTP, which has no governmental 
support, was established in 1982. Our membership, now over 1,000 
members strong, is comprised of physicians and scientists actively 
engaged in the research and practice of transplantation medicine and 
immunobiology. Given that our membership spans the disciplines of 
cardiology, hepatology, nephrology, pulmonology, infectious disease, 
and histocompatability, and that 25 percent of our members are surgeons 
with an expertise in related surgical specialties of solid organ 
transplantation, the ASTP represents the largest and broadest number of 
professionals in the field of transplantation in the United States.
    A principle goal of the ASTP is to serve as a forum for the 
exchange of scientific information related to transplantation and 
immunology and to promote and encourage research. One of the strategies 
for obtaining this goal is our annual scientific meeting. At the 1997 
ASTP Annual Meeting in Chicago last May, we had over 1,000 abstracts 
submitted highlighting cutting edge science in transplantation medicine 
and immunobiology.
    Today, my testimony will focus on fiscal year 1999 appropriations 
for the National Institutes of Health (NIH), particularly the National 
Institute for Allergy and Infectious Diseases (NIAID), National 
Institute for Diabetes, Digestive, and Kidney Diseases (NIDDK), 
National Heart, Lung, and Blood Institute (NHLBI). I will highlight 
those areas of research that need to receive additional emphasis and 
funding in fiscal year 1999.
    During the next hour, four new names will join those 56,793 
individuals in this country waiting for a solid organ transplant. And 
by the time I get home to Atlanta this evening, 10 individuals will 
have died because the wait for a transplant was just too long.
    But, Mr. Chairman with increased funding for research there is 
hope.
    Over the last 20 years, transplantation of solid organs has moved 
from experimental to accepted therapy, with nearly ------ performed in 
1997 alone. The success of this procedure has improved greatly over the 
last few years with almost all solid organ recipients enjoying an 83 to 
97 percent survival rate at one year. Much of this success can be 
attributed to research in immunosuppression that has been funded by 
previous NIH appropriations. However, this success has brought with it 
new challenges.
    More and more individuals are agreeing to be placed on waiting 
lists for an organ transplant. As I mentioned before, 56,793 
individuals are currently waiting for transplants, an increase of 255 
percent in the last ten years. It is unfortunate and absolutely 
unnecessary for those in need of a transplant to go without the ``Gift 
of Life.'' This happens because the supply of available donors is far 
less than the demand. Each year, the ASTP identifies the shortage of 
available donors as the number one problem in the field of 
transplantation.
    In December 1997 the Administration launched a national organ and 
tissue donation initiative to encourage more families to discuss and 
understand there loved ones' wishes in regard to donation. This may 
help in reducing family refusal, which is the number one cause of loss 
of potential donors today. Therefore, the ASTP urges this Subcommittee 
to provide the Department of Transplantation located in the Health 
Resources and Services Administration with additional funds for fiscal 
year 1999. This funding will help to insure the success of the 
Administration's initiative and any other programs conduct by the 
Department of Transplantation that enhance donor awareness and improve 
the public trust in the process.
    Research is central to all that occurs in the transplantation 
process. The ASTP believes that we are on the threshold of many 
important scientific breakthroughs in areas of transplantation 
research, such as rejection immunosuppression tolerance and xenografts. 
Because of this, the ASTP strongly urges this Subcommittee to continue 
its leadership in the area of biomedical research and provide a 15 
percent increase in funding for the NIH for fiscal year 1999. The ASTP 
supports this level of increase for the NIAID, the NIDDK, and the 
NHLBI, as well. By providing this increased level of funding, this 
Subcommittee will achieve the ultimate goal of doubling the NIH budget 
in 5 years. A concept supported by the ASTP and many of those societies 
who are members of the Ad hoc Coalition for Biomedical Research. With 
this level of increase, this Subcommittee and the Congress, as a whole, 
will have the personal satisfaction of knowing that they were 
responsible for expanding the general transplantation research 
authority at the NIH, as a whole.
    With this expanded authority, clinical and basic transplantation 
funding at the NIH must be increased. In particular, we recommend that 
Congress and the NIH designate the following as high priority 
initiatives at the NIAID, the NIDDK, and the NHLBI.
The National Institute for Allergy and Infectious Diseases (NIAID)
    (1) Basic and clinical immunology, stressing an understanding of 
immunologic mechanisms of tolerance and autoimmunity, evaluation of 
chronic transplant rejection, and immunosuppression in transplant 
patients.
    (2) Basic immunology stressing the response to xenotransplants and 
methods to overcome the response.
    (3) Further structures on identification and treatment of 
infectious disease risks associated with xenotransplantation.
The National Institute for Diabetes, Digestive, and Kidney Disease 
        (NIDDK)
    (1) Continuation of the liver transplant database.
    (2) Studies to improve the survival of renal transplants, including 
improved mechanisms of donor and recipient matching.
    (3) Clinical trials to compare the outcome of combined kidney-
pancreas transplant to kidney alone for diabetic patients. Prioritize 
increased funding for pancreatic islet cell transplantation.
    Great progress has been made in the field of pancreas 
transplantation and now simultaneous kidney/pancreas transplant offers 
greater survival at five years than kidney alone, and the majority of 
patients no longer need insulin. However, most insurance companies do 
not cover this combined transplant because definitive prospective 
studies have not been conducted. The NIDDK needs to sponsor a trial to 
document the superior benefit of combined kidney/pancreas transplant to 
convince third party payers and Medicare to cover this procedure, and 
further fund research to assess the comparative benefit of whole organ 
(pancreas) versus islet cell transplantation.
National Heart, Lung, and Blood Institute (NHLBI)
    (1) Clinical trials in immunosuppression in heart transplantation.
    (2) Research on chronic rejection, applying promising new 
technology such as intravascular ultrasound.
    One new clinical advance is the development of an intravascular 
ultrasound imaging technique that allows measurement and detection of 
thickening of the vessel wall of the transplanted organ and follows 
these changes over time. This is currently being performed in heart 
transplant recipients, but the test is not reimbursed. This is the 
perfect opportunity to have NHLBI partner with industry to conduct a 
trial of new therapies to retard or prevent the development of this 
disease.
    (3) Establish the creation of databases for each stage heart 
disease to understand the disease and plan future needs.
    Heart failure is the number one admitting volume diagnosis in the 
Medicare system, the longest DRG, and it has the highest readmission 
rate. There are an estimated one million people with this diagnosis 
which has as much or more of an impact on the health care budget as any 
other disease. In addition, the increasing average age of the U.S. 
population indicates that this disease will only increase.
    We talk quite a bit in the transplantation community about how 
receiving a transplant can be the ``Gift of Life.'' You can't put a 
price tag in human terms of such a gift. Yes, a transplant procedure 
and follow-up care is expensive. But, relative to the lost 
productivity, the impact on quality of life, and the cost of living 
with end stage heart or renal disease, transplantation is cost 
effective. Also, it may be the only hope not just for improved 
survival, but for a full and healthy life for many individuals and 
their families. So, I end my remarks here today, by repeating ASTP's 
request that this Subcommittee and the Congress approve a 15 percent 
increase for the NIH for fiscal year 1999. Thus allowing the high 
priorities initiatives outlined above to be funded and commence.
                                 ______
                                 
 Prepared Statement of Peter E. Schwartz, M.D., President, Society of 
                        Gynecologic Oncologists
    Chairman Specter, Senator Harkin, and Members of the Subcommittee, 
I am Peter E. Schwartz, M.D. I am here today in my capacity as the 
President of the Society of Gynecologic Oncologists (SGO). The SGO is 
the only national medical specialty society devoted to the study and 
treatment of cancers of the female reproductive tract. These 
malignancies include cancers of the cervix, endometrium or uterus, and 
ovary. The SGO has more than 750 members who specialize in providing 
comprehensive care for women with gynecologic cancers, including 
prevention, diagnosis, surgery, and all subsequent therapy.
    I am extremely grateful for the opportunity to provide public 
witness testimony on behalf of the SGO in support of increased funding 
for the National Institutes of Health, and particularly the National 
Cancer Institute.
    My remarks today will focus on the three major types of gynecologic 
cancers, detailing their incidence and providing some examples of how 
additional research dollars are critically needed to improve 
prevention, diagnosis, treatment, and survival for the estimated 82,000 
women who were diagnosed with a gynecologic cancer in 1997.
              the three major types of gynecologic cancers
    The three most common types of gynecologic cancers are cervical, 
endometrial or uterine, and ovarian cancer.
Cervical cancer
    (1) Cervical cancer accounts for 6 percent of all cancers in women. 
In 1997, an estimated 14,500 women were diagnosed with invasive 
cervical cancer and an estimated 4,800 of those women died from 
cervical cancer. An estimated 65,000 women were diagnosed with pre-
invasive cervical cancer.
    Early detection greatly improves the chances of successful 
treatment. In fact, cancer of the cervix can be a preventable disease 
if women are regularly screened using the Pap test.
    While the vast majority of cervical cancers can be prevented, there 
are usually no signs or symptoms associated with cervical pre-cancers 
and early cancer. The symptoms develop after the cancer has become 
invasive.
    Survival rates of invasive cervical cancer patients are relatively 
high at eighty-seven percent one year after diagnosis and sixty-nine 
percent five years after diagnosis. However, we can and must do better.
    Currently, there is some very exciting research being conducted to 
prevent and treat invasive cervical cancer. Some of the promising new 
developments include research in the following: (1) How certain genes 
called oncogenes and tumor suppressor genes control cell growth and how 
changes in these genes cause normal cervical cells to become cancerous; 
(2) New laboratory tests to detect the types of human papilloma viruses 
or HPV that appear to cause cervical cancer; and (3) Improvements in 
the Pap test. The most exciting research in this area is the work going 
on at the National Cancer Institute (NCI) in the area of vaccines for 
preventing and treating cervical cancer.
    Increased funding for this research can speed new techniques for 
detection and treatment of cervical cancer to physicians and their 
patients.
Endometrial or uterine cancer
    (2) Cancer of the endometrium is the most common cancer of the 
female reproductive organs. In 1997, an estimated 34,900 women were 
diagnosed with endometrial cancer and 6,000 of those women died from 
endometrial cancer.
    While early detection improves the chances that endometrial cancer 
can be treated successfully, at this time, there are no recommended 
screening tests or examinations that can reliably detect most 
endometrial cancers in asymptomatic women.
    In some cases, women experience symptoms of endometrial cancer, 
permitting diagnosis at an early stage. Unfortunately, endometrial 
cancers may reach an advanced stage before recognizable signs and 
symptoms are present.
    The 1-year relative survival rate for endometrial cancer is 93 
percent and the 5-year relative survival rate is 95 percent, if 
endometrial cancer is found at an early stage. The relative survival 
rate falls to 66 percent if the cancer is diagnosed at a regional 
stage.
    To improve prevention, diagnosis, treatment, and survival of 
endometrial cancer patients, more research dollars are needed for 
projects such as the following: (1) determining the molecular pathology 
of endometrial cancer; (2) laparoscopic lymph node sampling; (3) 
research regarding tumor markers; and (4) development of new 
chemotherapy drugs as well as angiogenesis inhibitors.
Ovarian cancer
    (3) Ovarian cancer accounts for 4 percent of all cancers among 
women. Ovarian cancer ranks fifth as a cause of cancer deaths among 
women, and causes more deaths than any other cancer of the female 
reproductive system. In 1997, an estimated 26,800 new cases of ovarian 
cancer were diagnosed and an estimated 14,200 women died from ovarian 
cancer.
    While early detection improves the chances that ovarian cancer can 
be treated successfully, early cancers of the ovaries rarely cause 
symptoms that women would notice, or the symptoms are mistaken for 
menopausal ailments or intestinal illnesses.
    Early detection is complicated by the fact that the ovaries are 
deep inside the pelvis and cannot be seen directly without surgery. 
Small ovarian tumors are difficult for even the most skilled examiner 
to feel. In fact, there are no screening tests now available which are 
accurate enough to use in finding ovarian cancer early among women who 
have no symptoms.
    Unfortunately, almost 70 percent of women with ovarian cancer are 
not diagnosed until the disease is advanced in stage. The 5-year 
survival rate for these women is only fifteen to twenty percent. More 
than ever, there is a need for a greater awareness and understanding of 
ovarian cancer. Educational efforts must be increased to ensure that 
women and their primary care physicians and gynecologists recognize the 
symptoms and understand the risk factors for ovarian cancer.
    Additionally, now is the time to establish an agenda for more 
research into the areas of basic and translational research, genetic 
susceptibility and prevention, diagnostic imaging, screening and 
diagnosis, and therapy that could hold the most promise for future 
discoveries that will lead to improved prevention, detection, and 
treatment of ovarian cancer.
    The PHS Office on Women's Health (OWH), the Society of Gynecologic 
Oncologists (SGO), and the National Cancer Institute (NCI), in an 
effort to put ovarian cancer at the forefront of our nation's cancer 
research agenda, sponsored a Strategic Planning Conference on New 
Directions in Ovarian Cancer Research on December 8-9, 1997, in 
Washington, D.C. The purpose of the Conference was to outline the 
priorities for ovarian cancer research over the next five years.
    The Conference brought together a group of experts in gynecologic 
oncology, general oncology, diagnostic imaging, molecular 
endocrinology, and genetics, already armed with the knowledge of 
current procedures and techniques, in order to develop a strategic plan 
for ovarian cancer research.
    The Conference participants identified the following eight critical 
components as the priorities for the strategy for attaining a greater 
understanding of the disease, and for which a commitment to increased 
funding and investment in biomedical research should be pursued:
                          educational efforts
    The first critical component is to support greater educational 
efforts for both the physician and patient communities. Due to the fact 
that early detection of ovarian cancer is so difficult, and warning 
signs are often confused with symptoms of other types of abdominal 
ailments, it is essential that primary care physicians and 
gynecologists, as well as their patients, become aware of the potential 
early warning signs, the risk factors involved, and the importance of a 
complete medical history of both the patient and her family to assist 
in determining possible genetic risks.
             infrastructure for the study of ovarian cancer
    The second critical component is support for the development of a 
solid infrastructure for the study of ovarian cancer. Increased funding 
for ovarian cancer research is essential not only for Requests for 
Application (RFAs) and the creation of a Specialized Program of 
Research Excellence, otherwise known as a SPORE, but also for the 
recruitment and retention of young investigators as well as trained 
investigators from other fields. Innovative mechanisms to protect time 
for clinician scientists to conduct research are crucial, especially in 
the managed care environment that medical professionals now must 
practice in.
                     tissue procurement and banking
    The third critical component is support for tissue procurement and 
banking. Tissue procurement and banking is an intrinsic part of 
clinical trials. By standardizing tissue collection and storage, we can 
then gather epidemiological and follow-up data on ovarian cancer and 
correlate this data with molecular biological studies on the banked 
tissues.
  identification of genetic changes related to all stages of ovarian 
                                 cancer
    The fourth critical component is support for identification of all 
genes expressed in ovarian cancer tumors at all stages of the disease. 
This will facilitate the identification of molecular prognostic 
indicators, the identification of tools for early diagnosis, and the 
elucidation of the etiology of ovarian cancer.
             tumor makers and diagnostic imaging modalities
    The fifth critical component is support for the collection of data 
to evaluate the utility of current tumor makers such as CA125 and 
current diagnostic imaging modalities on mortality of ovarian cancer in 
a multinational randomized controlled trial. Such collection will also 
allow for the evaluation of additional markers to aid in detection of 
ovarian cancer.
 cohort study of patients at a genetically high risk for ovarian cancer
    The sixth critical component is support for the development of a 
cohort study of patients at a genetically high risk for ovarian cancer. 
Such a study would provide a base for an assessment of ovarian cancer 
risk in relation to specific mutations, an evaluation of the benefits 
and risks of chemopreventive interventions, and an infrastructure for 
gathering tissue from prophylactic surgery in a uniform way for use in 
molecular studies.
    evaluation of conventional therapy approaches to ovarian cancer
    The seventh critical component is support for an ongoing, 
multinational evaluation of conventional therapy approaches to ovarian 
cancer. This would provide for an assessment of the role of cytotoxic 
chemotherapy and the role of surgical debulking, as well as an 
evaluation of the optimal time for surgical intervention.
   development and evaluation of novel investigational approaches to 
                             ovarian cancer
    And finally, the eighth critical component is support for the 
development and evaluation of novel investigational approaches to 
ovarian cancer. This includes research into anti-angiogenic agents, 
apoptosis targets, novel molecular targets, and gene therapy.
    Chairman Specter, Senator Harkin, and Members of the Subcommittee, 
I greatly appreciate your time and attention to the need for additional 
resources for research being conducted for improved prevention, 
diagnosis, and treatment for gynecologic cancers. The SGO and I look 
forward to working with you in the years ahead on behalf of women and 
their reproductive health. I would be happy to answer your questions at 
this time.
                                 ______
                                 
   Prepared Statement of Rosalie Lewis, President, Dystonia Medical 
                          Research Foundation
    I am Rosalie Lewis, President of the Dystonia Medical Research 
Foundation. It is my pleasure to have the opportunity to submit 
testimony to the Subcommittee on behalf of the Foundation.
    First and foremost I would like to thank this subcommittee for its 
generous funding of the National Institutes of Health in its fiscal 
year 1998 appropriations bill. The Foundation is aware of the 
tremendous fiscal constraints under which you were working and we are 
extremely appreciative of your continued commitment and support of 
biomedical research.
    I have been formally involved with the Foundation since 1989, but 
on a more personal level I have been dealing with dystonia since 1985 
when the first of the three of our four children with dystonia was 
diagnosed. Dystonia has not only robbed my 20-year-old son Benjamin of 
the ability to walk unaided, or to use his hands for any fine motor 
coordination like writing, but now has made speaking most difficult. 
Like Benjy, my son Dan--now 17--also first exhibited symptoms of this 
disorder at age 7 and like Ben, dystonia has now made walking 
independently a challenge for Dan. The progression of early onset 
dystonia is relentless and uncontrollable. That is why, on behalf of 
the 300,000 other children and adults, I am asking for your help.
    Dystonia is a neurological disorder characterized by severe 
involuntary muscle contractions and sustained postures. There are 
several different types of dystonia, such as: generalized dystonia 
which afflicts many parts of the body and usually begins in childhood 
(my sons Benjamin and Daniel have generalized dystonia); focal 
dystonias affecting one specific part of the body such as the eyelids, 
vocal cords, neck, arms, hands or feet (my son Aaron has a focal 
dystonia of the hand); and secondary dystonia which is secondary to 
injury or other brain illness.
    There is no definitive test for dystonia (only now, with the 
identification of the genes responsible for childhood-onset and dopa-
responsible dystonia is there a definite test for these two genetic 
forms). Many primary care doctors have never seen a case of dystonia. 
This fact coupled with its varied presentations make it difficult to 
correctly diagnose. It is estimated that 85 percent of those suffering 
from dystonia are not diagnosed or have been misdiagnosed.
    In primary, uncomplicated dystonia, there is no alteration of 
consciousness, sensation, or intellectual function. Treatment for 
dystonia has met with limited and variable success with drug therapy, 
botulinum toxin injections, and several types of surgery. My children 
with generalized dystonia take huge doses of drugs which makes 
cognition difficult. But with a choice between walking and not walking, 
one may choose to tolerate drug side effects. Ben receives injections 
of botulinum toxin (botox) into the abductor muscles of his vocal 
cords, and he is experiencing moderate improvement.
    I am proud to be involved with the Dystonia Medical Research 
Foundation, founded just 22 years ago and since 1993 a membership-
driven organization.
    The goals of the Foundation have remained the same: to advance 
research into the causes of and treatments for dystonia; to build 
awareness of dystonia in the medical and the lay communities; and to 
sponsor patient and family support groups and programs.
To advance research
    Since 1977 the Foundation has awarded over 285 medical research 
grants totaling close to $15 million dollars. Among the more 
significant results of this research are the discovery this past year 
of the DYT1 gene, the gene for early-onset dystonia and in 1995 the 
identification of the gene for dopa-responsive dystonia. In addition, 
several drug therapies have been developed including the use of 
Botulinum Toxin, Baclofen, and Artane.
    The discovery of the DYT1 gene for early-onset dystonia was made by 
Dr. Xandra O. Breakefield, geneticist at the Neuroscience Center of 
Massachusetts General Hospital in Boston, and her additional 
collaborators after two decades worth of research and over $1 million 
in contributions by the Foundation. With the discovery of the DYT1 gene 
came the identification of torsin A, the protein for which the DYT1 
gene codes and which plays a crucial role in the chemistry of dystonia.
    On November 13, 1997, Dr. Xandra O. Breakefield spoke at the 
National Institute of Neurological Disorders and Stroke on the 
hypotheses from her research, the significance of these discoveries and 
directions for future research. The following were presented based on 
Dr. Breakefield's research:
  --It has been hypothesized that dystonia is caused by an imbalance in 
        dopamine transmission to the basal ganglia, from the supporting 
        data that: (a) drugs that block D2 receptors can cause dystonia 
        symptoms; (b) dopa-responsive dystonia is due to a block in 
        dopamine synthesis and treatable with dopa; and (c) dystonia 
        symptoms occur in early-onset Parkinson disease and with low 
        doses of dopa in Parkinson patients.
  --It has been hypothesized the GAG deletion in torsin A disrupts (or 
        decreases) the release of dopamine from the nerve terminal in a 
        dominant-negative manner. Possible actions of this protein are 
        as: (a) a heat-shock protein which protects dopa-minergic 
        neurons from stress--such as high body temperature or overuse; 
        (b) a component needed for vesicular release of dopamine at 
        nerve terminals; and (c) a chaperone protein need for 
        mitochondria integrity.
  --Future research is necessary to determine the normal function of 
        the torsin A protein through cellular localization, expression 
        of the protein in the brain, animal models, interaction 
        proteins, and functional assays in culture. Other members of 
        the newly discovered torsin family of human proteins need to be 
        mapped for and tested for involvement in other forms of 
        dystonia; these proteins may be involved in other forms of 
        dystonia or another neurological and psychiatric diseases, as 
        our present knowledge of torsin A and childhood-onset dystonia 
        suggests a new kind of pathogenic mechanism associated with a 
        particular window of time of susceptibility combined with some 
        kind of environmental or endogenous stress.
To build awareness
    It is the goal of the Foundation to educate the lay and medical 
audiences about dystonia so that people afflicted with the confusing 
symptoms need not go undiagnosed or misdiagnosed as is so common.
    The Foundation conducts medical workshops and regional symposiums 
during which comprehensive medical and research data on dystonia is 
presented, discussed, and then disseminated. In October 1996 the 
National Institutes of Health (NIH) was one of our co-sponsors for an 
international medical symposium with 60 papers on dystonia and 125 
representatives from 24 countries.
    Over 3,000 medical videos have been distributed since 1995 to 
hospitals and medical and nursing schools and at medical conventions. 
In addition, media awareness is conducted throughout the year but most 
especially during Dystonia Awareness Week, to be observed nationwide in 
1998 from October 11th through the 18th.
To sponsor patient and family support groups
    The Foundation has more than 200 chapters, support groups and area 
contacts across the United States and Canada. We have 15 international 
chairpersons representing awareness, children's advocacy, development, 
extension, the Internet, leadership, medical education, the on-line 
news group, and symposiums.
    Patient symposiums are held regionally in order to provide the 
latest information to dystonia patients or others who are interested in 
the disease. Since 1995 we have held fifteen regional symposiums to 
attract, educate, and inform more people about dystonia. In 1998 we 
will have five more symposiums. Our most recent international patient 
symposium was held on May 24-26, 1996 in New York City, and was a 
tremendous success with 350 in attendance.
The National Institutes of Health and Dystonia
    As mentioned, in October of 1996 we conducted a major medical 
symposium with support of the National Institute on Neurological 
Disorders and Stroke (NINDS). In February 1993 the Dystonia Foundation 
co-sponsored with the National Institute on Neurological Disorders and 
Stroke an international workshop to bring together basic and clinical 
investigators. We continue to need ``a greater interaction among 
researchers from different scientific disciplines [and] carefully 
collected epidemiological information on the dystonia subtypes * * *. 
NINDS encourages these ongoing research efforts towards the 
elucidation, treatment and eventual prevention of the various subtypes 
within the clinical spectrum of dystonia.''
    As you probably are aware, it can be extremely difficult for young 
scientists to break into the NIH grant system. The Dystonia Medical 
Research Foundation recommends that the National Institutes of Health, 
the National Institute on Neurological Disorders and Stroke, and the 
National Institute on Deafness and other Communication Disorders be 
funded for fiscal year 1999 at a 15-percent increase over fiscal year 
1998. This increase would be part of an overall request to double 
funding for the National Institutes of Health by fiscal year 2003. We 
would request that this increase does not come from funding sources 
which will require budgetary cuts in other public health service 
organizations. Because dystonia is the third most common movement 
disorder after Parkinsons and tremor and affects Americans six times 
more than most better known disorders such as Huntington's, Muscular 
Dystrophy, and ALS, we ask that NINDS fund dystonia-specific extramural 
research at the same level it supports research in those other 
neurological diseases.
    With the proper dedication of resources, we believe that more 
treatments and a cure can be developed that will help my three boys--
Aaron, Benjamin, and Daniel, and thousands of others.
    Thank you for the opportunity to submit testimony to the 
Subcommittee on behalf of the Dystonia Medical Research Foundation.
                                 ______
                                 
   Prepared Statement of Allison Rumery-Rhodes, Sudden Infant Death 
                           Syndrome Alliance
    Mr. Chairman and members of the Subcommittee, thank you for the 
opportunity to submit testimony to you regarding the federal 
government's response to and funding of Sudden Infant Death Syndrome 
(SIDS).
    As the parent of a child who died from SIDS, I would like to remind 
you that SIDS is a frightening disease that knows no geographic, 
economic or cultural boundaries. It can strike any infant, even if the 
parents do everything ``right.'' In the typical, but always tragic SIDS 
case, an apparently healthy child is put to bed without any indication 
that something is wrong. Sometime later, the infant is found dead. The 
infant's prior medical history, a complete postmortem examination, and 
a thorough investigation of the death scene provide no explanation for 
the cause of death.
    Although cases of the syndrome have been noted since biblical 
times, organized scientific research into the cause of SIDS is recent, 
dating to the mid-1970's. After decades of scientific study, we are 
just beginning to make real progress in reducing the number of babies 
dying of SIDS and are starting to unravel the mystery. The U.S. ``Back 
to Sleep'' campaign has heightened awareness about SIDS and offered 
parents an opportunity to reduce their infant's risk for SIDS. Initial 
results from this campaign indicate that SIDS rates have been reduced 
by 38 percent, the highest reduction in infant mortality rates in 20 
years! We have also learned that some infants who die of SIDS have an 
abnormality in a region of the brain thought to play a role in heart 
and lung control. This defect may hamper normal respiratory activity, 
and though not the sole cause of SIDS, it may contribute to a larger 
respiratory impairment leading to the baby's death. Whereas healthy 
babies' nervous systems detect breathing difficulties and arouse them, 
it is believed that SIDS babies may not be able to detect reduced 
levels of oxygen or elevated levels of carbon dioxide. Therefore they 
do not respond by gasping for breath, crying, or turning their heads 
like a non-impaired infant, leaving them more vulnerable to SIDS.
    These are important breakthroughs, expanding our understanding 
about SIDS and offering renewed hope that with further research we will 
be able to identify babies that are most vulnerable and ultimately 
prevent all SIDS deaths. However, our work is far from over. In this 
country more than 3,000 infants die each year as a result of SIDS. SIDS 
is the number one cause of death for infants one month to one year of 
age. It is a major component of the high rate of infant mortality in 
the United States, yet we still do not know what causes SIDS nor how to 
prevent it from claiming so many young lives.
    The primary federal agency responsible for conducting research into 
SIDS is the National Institute of Child Health and Human Development 
(NICHD) at the National Institutes of Health (NIH). In addition to 
federal funding of SIDS research, there are other agencies involved in 
SIDS efforts. Since 1975, the Maternal and Child Health Bureau (MCHB) 
of the Health Resources and Services Administration (HRSA) has 
supported specific programs for SIDS family counseling and for public 
and professional education about SIDS. Currently, MCHB is implementing 
SIDS initiatives recommended by the federally funded ``Nationwide 
Survey of Sudden Infant Death Syndrome Service,'' including a grant 
which was issued for a new SIDS Services Center in 1997. The Centers 
for Disease Control and Prevention (CDC) has established a standardized 
death scene investigation protocol for SIDS incidents. An Interagency 
Panel on SIDS, which includes the NIH, HRSA, CDC, Indian Health 
Services, Food and Drug Administration, Substance Abuse and Mental 
Health Service Administration, US Consumer Product Safety Commission, 
Department of Defense, Administration for Children and Families, and 
the Department of Justice help coordinate SIDS activities between 
government agencies.
    National Institute of Child Health and Human Development.--Mr. 
Chairman, thanks to the funding which has been provided by this 
Subcommittee, researchers supported by the NICHD SIDS Program have been 
making real progress in the fight against SIDS. In 1988, at the request 
of Congress, the NICHD assembled a group of scientists to examine the 
current state of knowledge about SIDS and articulate future SIDS 
research needs. The result of this effort was the SIDS Five Year 
Research Plan. The Five Year Plan was so successful and productive that 
a second SIDS Five Year Plan was initiated in fiscal year 1995. Through 
research projects sponsored by NICHD, scientists have expanded our base 
knowledge of SIDS and our understanding of the causes and underlying 
mechanisms of the syndrome. Research objectives have focused on: 
identifying infants at risk for becoming victims of SIDS including 
developing markers to detect which babies are most vulnerable; 
clarifying the relationship between high-risk pregnancy, high-risk 
infancy, and SIDS; investigating factors which place babies at higher 
risk and stresses that may trigger a SIDS occurrence; and exploring 
mechanisms and interventions that may prevent SIDS deaths.
    Provided below are a few examples of new or expanded initiatives 
that could be implemented with a funding level of $17,355,000 in fiscal 
year 1999 for the SIDS Five Year Research Plan.
  --Establishment of a community child health research network in 
        communities with substantial under-represented minority 
        populations to develop and implement common biomedical research 
        protocols targeted at reducing morbidity and sudden death in 
        infancy and early childhood, and to train minority researchers.
  --A study to validate potential predictive biologic tests for SIDS 
        risk, such as computer analysis of heart rate variability and 
        cry characteristics, in the general population.
  --Issue a request for applications on the biology of arousal to 
        inform the research community of NICHD's interest in grant 
        proposals covering molecular, cellular, organ system and 
        behavioral aspects of arousal in developing organisms.
  --Extension of the prospective ``Infant Care Practices Study'' which 
        is evaluating care-taking practices from birth through one year 
        of age in two geographic areas. This project provides 
        information to improve the efficacy of the ``Back to Sleep'' 
        campaign.
  --Expansion of the ``Back to Sleep'' campaign to improve the efficacy 
        of the public health education effort. Additional resources are 
        needed for the development and distribution of culturally 
        relevant materials for minority groups, outreach to minority 
        groups and day care centers, education of fathers and 
        grandparents, exhibits and speaking engagements, and for 
        evaluating the delivery of the strategies used to change the 
        behavior of care givers.
    The SIDS Alliance is grateful to the Subcommittee's past support. 
We urge you again to provide the additional funding necessary for the 
fifth year of the second Five Year SIDS Research Plan so that NICHD can 
complete critical initiatives. Further research is essential to find 
the reasons for, and means of preventing the tragedy of Sudden Infant 
Death Syndrome.
    Centers for Disease Control.--Due to inconsistencies from state to 
state at the scene of an unexplained infant death, in 1993 Congress 
recommended that a standard death scene protocol be established. The 
hope was that the death scene protocol would be adopted by states to 
assist in developing a better statistical grasp on SIDS cases, and 
would help to avoid awkward and sometimes emotionally charged 
misunderstandings at the scene. In July 1993, the Centers for Disease 
Control and Prevention and the National Institute of Child Health and 
Human Development held a workshop on ``Guidelines for Scene 
Investigation of Sudden Unexplained Infant Deaths''. The proceedings of 
the workshop were published in the American Journal of Forensic 
Sciences in 1995. The actual protocol was published in the Mortality 
Morbidity Weekly Report in the summer of 1996. Since then it has also 
been republished by the Journal of SIDS Infant Mortality. 5,000 copies 
of the ``Guidelines for Scene Investigation of Sudden Unexplained 
Infant Deaths'' have been printed, and approximately 4,000 copies have 
been distributed to date. The long term goal of the SIDS Alliance is to 
work with and encourage each state's adoption of the guidelines. To 
help to realize this goal the SIDS Alliance would like to request that 
the CDC create a demonstration project to test the implementation of 
these guidelines in several communities nationwide.
    Maternal and Child Health Bureau.--The MCHB supports a number of 
SIDS related services and issues, including the National SIDS Resource 
Center, a major source of current information about SIDS. The Center 
maintains a national database of approximately 5,000 books, reports, 
and articles on SIDS and bereavement, and publishes information for 
national distribution. The National SIDS Resource Center has played a 
significant role in the ``Back to Sleep'' campaign, staffing the 800 
hotline number and processing the more than 4 million pieces of 
campaign materials.
    MCH Service Block Grant funds are used by MCH State Directors, 
either alone or in combination with non-federal funds, to provide a 
range of services to SIDS families in each state. Block grant funds 
support activities such as contact with families immediately after 
death; discussion of the autopsy results with the family; and family 
support through the first year of bereavement. Unfortunately, in many 
jurisdictions across the country, funds for these services have 
decreased or even been eliminated because of budgetary difficulties.
    At the direction of Congress, MCHB funded the ``Nationwide Survey 
of Sudden Infant Death Syndrome Services'' in 1992. In response to 
needs identified through the Survey, MCHB contracted the development 
and field testing of a curriculum to train health care providers in the 
case management of families who have experienced an infant death, as 
recommended by the Survey. To date, 100 health professionals have 
participated in the training program. MCHB is also supporting the 
development of model programs to meet the needs of families--
particularly the under served and minorities--who experience an infant 
death, as recommended by the Survey. Four demonstration grants in 
California, Massachusetts, Missouri and New York have been initiated to 
target services for specific populations.
    Recently, the MCHB established a national SIDS program support 
center to address SIDS service issues at the federal level on an 
ongoing basis. The SIDS Alliance has been chosen to run this center, 
which opened this year. The center was another recommendation of the 
SIDS Survey.
    Fourth SIDS International Conference.--The SIDS Alliance, in 
conjunction with SIDS International and in cooperation with NICHD, MCHB 
and CDC hosted the Fourth SIDS International Conference on June 23-26, 
1996 in Bethesda, Maryland. Over 700 registrants and 300 guests 
participated in this unique event. The partnership of countries 
provided by the International Conference has resulted in a heightened 
awareness of SIDS throughout the world, as well as a vital link 
allowing the rapid exchange of high quality international research, 
prevention, and service data. The global focus of efforts facilitates 
scientific breakthroughs and enables the development of innovative 
public health strategies to combat SIDS and assist families. 
Collaborative efforts such as the Fourth SIDS International Conference 
are crucial in moving forward with all aspects of activities relating 
to SIDS including research, death scene protocol and local SIDS 
services.
    We are all too painfully aware, Sudden Infant Death Syndrome has 
historically been a mystery, leaving in its wake devastated families 
and bewildered physicians. In the past there have been no answers to 
why a baby dies of SIDS. For new and expectant parents there have been 
no answers on how to prevent SIDS from claiming their child. But today, 
we are beginning to find some of the answers such as factors that 
increase the risk for SIDS and actions parents can take to reduce the 
risks. Recent research has provided us with an unprecedented 
opportunity to decrease the number of SIDS deaths by alerting new 
parents about a few simple steps that they can take. It is important to 
realize however, that while following the recommendations presented may 
help to prevent some SIDS deaths, it will not save all babies; we still 
do not know what causes SIDS nor do we know how to predict which babies 
are vulnerable.
    There is still a great deal more that needs to be done in the fight 
against SIDS. It would truly be a tragedy if research efforts were 
halted or delayed at the point when so much progress is being made. 
Research capability and technology are available to conduct additional 
studies that will advance our abilities to eliminate SIDS. Now is the 
time for us to do something about SIDS and prevent babies from dying of 
SIDS in the future.
    As a SIDS parent, I am active in private organizations such as the 
SIDS Alliance that provide support to newly bereaved families, educate 
the public about SIDS and reducing the risks for SIDS, and fund SIDS 
research; but these organizations cannot do it alone. We need your 
help, your commitment, and your support. Moving towards the 21st 
Century, the political and fiscal realities of the world require that 
the public and private sectors work together to solve societal 
problems.
    I urge the subcommittee to support SIDS research and education by 
funding the NICHD at a level of $775,980,900. This is an increase of 
$10,121,490 or 15 percent over the fiscal year 1998 budget. This 
increase would be part of an overall request for doubling funding for 
the National Institute of Health by fiscal year 2003. We would request 
that this increase does not come from funding sources which will 
require cuts in other public health service agencies. As this 
subcommittee works toward doubling funding for the National Institutes 
of Health, we believe that it is reasonable to anticipate a doubling of 
the funding commitment to SIDS research through NICHD. We also request 
that Congress continue to encourage MCHB and CDC to move forward with 
their initiatives to help SIDS families by expanding the availability 
of services and promoting standardized, thorough and compassionate 
death scene investigations.
    On behalf of the thousands of families who have been devastated by 
the loss of a baby to SIDS, and the millions of concerned and 
frightened new parents each year, we thank you for your past leadership 
and support, and for enabling the Sudden Infant Death Syndrome Alliance 
to provide this testimony. If you have any questions, please do not 
hesitate to contact us.
                                 ______
                                 
   Prepared Statement of Susan Scrimshaw, Ph.D., Dean, University of 
   Illinois School of Public Health, on Behalf of the Association of 
                        Schools of Public Health
    Mr. Chairman, I am Susan Scrimshaw, dean of the School of Public 
Health at the University of Illinois at Chicago and a chair of the 
legislative committee of the Association of Schools of Public Health.
    I would like to thank you, Mr. Chairman and members of the 
subcommittee, for the opportunity to present our statement on the ASPH 
fiscal year 1999 appropriations requests for PHS programs of primary 
concern to the academic public health community. You will find a chart 
at the end of my statement that outlines these recommendations. For 
now, I would like to highlight some of them.
Health professions education
    Although we are pleased that the Administration recommended level 
funding for HRSA's health professions education and training programs 
(much better than last year's proposal to cut them), we strongly 
recommend that Congress tackle a problem that has been left to fester 
for over a decade: the lack of adequately trained public health 
professionals to run this country's public health system. In 1988, the 
Institute of Medicine (IOM) found that the U.S. public health 
infrastructure was in a state of disarray and identified serious 
shortages of public health professionals. According to HHS, the U.S. 
public health system is still disorganized and experiencing shortfalls 
in the number of comprehensively-trained epidemiologists, 
biostatisticians, maternal and child health and environmental health 
specialists, public heath nurses, dentists and physicians, among 
others.
    According to experts in the Public Health Service, less than 
100,000 of the estimated 500,000 in the public health workforce have 
graduate education in the public health sciences. It is estimated that 
at least 40,000 environmental public health specialists require further 
training and education in order to function effectively on the job. Yet 
there is still a need for 120,000 more to staff unfilled vacancies.
    There is a need for more public health physicians, dentists, and 
nurses. For example, there are only about 4,300 certified preventive 
medicine physicians in the U.S., yet the estimated need hovers around 
10,000. Much the same can be said about dentists (there are 128 
certified public health dentists as compared to the 5,000 that are 
required today) and public health nurses. Furthermore, federal, state 
and local public health officials report problems in recruiting 
epidemiologists, biostatisticians, maternal and child health, 
occupational health professionals, and public health nutritionists.
    We are concerned that the large majority of practicing public 
health professionals currently lack the skills, knowledge and 
competencies to do their important jobs effectively. My school 
conducted a study recently and found that only about 25 percent of 
local public health departments have the staff to adequately address 
the three core areas of public health: assessment, policy development 
and assurance. Mr. Chairman, we need your help in seeking solutions to 
these inadequacies. We spend over $6 billion a year to ensure that 
physicians are well trained in the medical sciences to treat and cure 
diseases; yet we spend mere pittances to train professionals to prevent 
those diseases, promote health and diminish disability among U.S. 
citizens.
    The rush toward controlling medical care costs has created the 
managed care movement. This development has increased the need for 
public health professionals, persons with the skills, knowledge, 
competencies and values to address the characteristics and challenges 
of this emerging health care system. According to the Pew Charitable 
Trusts, these are: greater orientation towards health; prevention of 
disease and disability; focus on the health status of populations/
communities; expectations of accountability and cost control; knowledge 
of treatment outcomes; reconsideration of human values. Yet 
professionals with knowledge and skills to address them are in short 
supply.
    To begin addressing these needs, Mr. Chairman, we respectfully 
request that Congress appropriate at least $50 million to support 
HRSA's public health training programs, including training of 
preventive medicine physicians, nurses and dentists, environmental 
health and maternal and child health specialists.
    In addition, ASPH joins the more than 40 national organizational 
members of the Health Professions and Nursing Education Coalition 
(HPNEC) in recommending an fiscal year 1999 appropriation of at least 
$306 million for Titles VII and VIII of the Public Health Service Act. 
Along with these organizations I wish to thank the subcommittee members 
for supporting these important programs that are designed to meet the 
nation's need for primary care providers and public health 
professionals in short supply.
Prevention research
    Congress authorized CDC to establish a national network of 
university-based centers to undertake research and demonstration 
projects in health promotion and disease prevention. Currently, 14 
prevention research centers (PRCs), located mostly in schools of public 
health, form partnerships with state and local health agencies and 
community-based organizations to put into place innovative programs 
that prevent disease and promote health. PRCs serve to bridge the gap 
between public health science, research in academia and public health 
practice in communities.
    In 1995, CDC asked the IOM to review the PRC program and determine 
the extent to which it was meeting its congressionally mandated goals: 
to provide a sound scientific basis for health promotion and disease 
prevention policies and practices; and to translate research findings 
into community-based interventions.
    In short, CDC wanted the IOM to determine if the PRCs were: 
``applying research findings and making them work at the local level.'' 
Late in 1996, the IOM released its report on the CDC PRC program: 
Overall, the committee finds that the PRC has made substantial progress 
and is to be commended for its accomplishments on advancing the 
scientific infrastructure in support of disease prevention and health 
promotion policy programs and practices.
    In light of the IOM review, we respectfully request that you 
support an fiscal year 1999 appropriation of $24 million for the CDC 
prevention research centers program. The program was authorized in 1986 
to provide $1 million per center; this goal has never been reached. An 
increase in fiscal year 1999, albeit minor in comparison to NIH 
appropriations for centers with similar missions, would contribute 
greatly to this nation's attempts to change behaviors that put 
Americans at risk for chronic health conditions; they claim a 
disproportionate number of lives, especially those Americans in 
vulnerable populations (the elderly, the underserved, the 
underrepresented), plus add fuel to the nation's excessive health care 
costs.
    Mr. Chairman, we also go on record in support of the 
Administration's fiscal year 1999 request to fund CDC's extramural 
research program but at $100 million instead of $25 million. To 
effectively integrate health promotion and disease prevention 
strategies into our national health care system, promising 
interventions applicable at the community level need to be developed 
and evaluated. Prevention research enhances the nation's public health 
agenda by providing a scientific context for health promotion and 
disease prevention.
    Speaking of prevention research at CDC, we respectfully recommend 
that the NIH be urged to focus more attention on population-based 
research strategies targeted at precluding the development of disease, 
or postponing its symptomatic onset, through changes in personal habits 
and factors in the social and physical environment. It is anticipated 
that greater resources across the NIH institutes would be put into 
extramural prevention research which includes the following types of 
activities: investigations into the epidemiology of disease including 
identification of social and behavioral determinants of illness; 
studies of means to ameliorate personal, social and environmental 
factors contributing to disease onset or exacerbation; studies on 
immunization strategies and of methods for and the cost-effectiveness 
of population screening programs; studies on immunization strategies 
and or methods for and the cost-effectiveness of population screening 
programs; and studies into the means by which further decline in 
physical or social functioning can be prevented in people already ill. 
In general, the focus would be upon research that employs retrospective 
and longitudinally prospective populations groups, such as high risk 
groups or communities.
    In short, Mr. Chairman, we urge your subcommittee to support 
initiatives at NIH and CDC that adopt population-based approaches to 
the health status and needs of the American public: initiatives that 
work towards a better balance between caring for the sick and disabled 
and keeping people healthy. We should promote public health policies 
and programs that promote the postponement of morbidity opposed to the 
current practice of postponement of mortality (wellness instead of 
sickness).
    There is another federal prevention initiative that, in our 
opinion, deserves the committee's support, Mr. Chairman: CDC's injury 
prevention and control program. Entitled ``Safe America,'' this program 
is designed to ensure that Americans are safe in their homes, schools, 
while traveling and at work and play. This will be accomplished through 
a strong research program that provides the foundation for the delivery 
of effective intervention in states and communities, along with a 
national campaign and information system to inform Americans of what 
prevention measures work and how to access prevention resources.
    Currently, the extramural research program at the National Center 
for Injury Prevention and Control consist of 10 injury control research 
centers located in major universities across the country and an 
investigator initiated research project grant program. Mr. Chairman, we 
request that you support a $40 million increase in the fiscal year 1999 
appropriations for CDC's Safe America program. Of this $40 million , we 
are requesting that $20 million be directed to extramural research to 
expand the injury control research centers, increase the number of 
individual investigator awards and initiate a training grant program to 
attract new investigators to the field of injury control.
    By the way, Mr. Chairman, ASPH strongly applauds your efforts to 
double the NIH budget and commends your vision and leadership in this 
quest. We support the Ad Hoc Group for Medical Research Funding and its 
recommendation of a 15 percent increase for NIH in fiscal year 1999. We 
see this as a ``first step'' in achieving your goal by 2003. We also 
urge that equal commitment be given to NIH partners in its mission to 
improve the nation's health: HRSA, CDC, AHCPR and OPHS.
    As we prepare to celebrate the 200th anniversary of our nation's 
Public Health Service this July, we urge you and members of the 
subcommittee to renew the long-standing commitment and support of this 
stellar American institution by increasing funding for agencies that 
have contributed to making the U.S. health system the best in the 
world. These public health partners, along with state and local public 
health agencies and community-based organizations, and this nation's 28 
accredited schools of public health, have nurtured and harvested 
federal investments in improving the health status of the American 
public. As such, we support the fiscal year 1999 appropriations 
requests of the following coalitions that have or will testify before 
your subcommittee:
    Ad Hoc Group for Medical Research Funding; CDC Coalition; Coalition 
for Health Funding; Friends of AHCPR; Friends of NIOSH; Friends of 
Title V (MCH block grant); and Health Professions and Nursing Education 
Coalition.
    Mr. Chairman, the requests outlined by these coalitions represent 
the needs assessment that were derived from the views and expert 
opinions of this country's most respected administrators, scholars, 
scientists and leaders in the volunteer sector. I know you and the 
subcommittee members will take them into serious consideration when 
marking-up the fiscal year 1999 appropriations bill.
    Mr. Chairman, I would like to end my testimony by once again 
commending you and the members of the subcommittee for supporting PHS 
programs, in general and academic public health programs, in 
particular. The latter contribute to our efforts to educate and train 
public health professionals in the population-based approaches to the 
prevention and control of disease and promotion of health among 
individuals and communities. These are:
  --Assessment of the health status of communities to identify the most 
        pressing health problems of each community, thus enabling 
        effective and efficient deployment of health resources;
  --Outreach, screening and personal health services to reduce the toll 
        from vaccine-preventable diseases, tuberculosis, sexually 
        transmitted diseases, AIDS, lead poisoning, infant mortality, 
        violence and other preventable public health problems
  --Community monitoring and health protection actions to assure clean 
        air, safe water and nutritious, safe food supplies; and
  --Education in health promotion and disease prevention by health care 
        providers and public health professionals
    Outlined below are the ASPH fiscal year 1999 funding 
recommendations for programs of primary concern to the academic public 
health community:

Centers for Disease Control and Prevention

Prevention centers......................................     $24,000,000
Prevention research.....................................     100,000,000
NIOSH training..........................................      20,000,000
Injury control research.................................      20,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total CDC.........................................   2,800,000,000
                    ========================================================
                    ____________________________________________________

Health Resources and Services Administration

Public Health, Preventive Medicine and Dental Public 
    Health..............................................      50,000,000
MCH training............................................      20,000,000
Health professions......................................     306,000,000
MCH block grant.........................................     705,000,000
Family planning.........................................     218,400,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total HRSA........................................   4,200,000,000
                    ========================================================
                    ____________________________________________________

National Institutes of Health

NIH.....................................................      15,600,000

Agency for Health Care Policy and Research

AHCPR...................................................     175,000,000

    The Association of Schools of Public Health (ASPH) is the 
only national organization representing the deans, faculty, and 
students of this nation's 28 accredited schools of public 
health in the United States and Puerto Rico. These schools have 
a combined faculty of over 2,500 and educate more than 15,000 
students annually from every state in the U.S. and most 
countries throughout the world. The schools graduate 
approximately 5,000 professionals each year. The 28 schools of 
public health constitute a primary source of comprehensively 
trained public health professionals and specialists in short 
supply to serve the federal government, the 50 states and 
private sector. According to the Pew health professions 
commission, managed care will increase the need for public 
health professionals.
                                ------                                

    Prepared Statement of Dr. J. Alfred Rider, President, Board of 
             Trustees, Children's Brain Diseases Foundation
    I am Doctor J. Alfred Rider, President of the Board of Trustees of 
the Children's Brain Diseases Foundation. It is a pleasure to submit 
testimony on behalf of the Foundation for inclusion in the Senate 
Appropriations Committee, Labor-HHS Education Subcommittee hearing 
record for fiscal year 1998-99. I am submitting my testimony on behalf 
of the children's Brain Diseases Foundation and the thousands of 
children and their families who are affected with Batten disease.
    Specifically, I would like to address the need for continued 
funding at the previous 1994 level plus an increase amounting to 
approximately an average yearly addition of 4.1 percent since then for 
Batten disease research or a total of $3,470,000. Batten disease is a 
neurological disorder affecting the brains of infants, children and 
young adults. It occurs once in every 12,500 births. There are 
approximately 440,000 carriers of this disorder in the United States. 
It is the most common neuro-genetic storage disease in children. There 
are four major types of Batten disease-the infantile, late infantile 
and juvenile in children and Kuf's disease in young adults. Motor and 
intellectual deterioration, visual loss, behavioral changes, and the 
onset of progressively severe seizures and termination in death in a 
vegetative state characterize the usual case. This irreversible severe 
illness constitutes an enormous nursing and financial burden to 
families with afflicted children. Patients may live in a deteriorating 
state from 10 to 43 years. The changes that occur in the brain in these 
children are quite similar to many changes that occur in the aging 
person. Thus, effective treatment for Batten disease may also allow us 
to alter the aging process and age associated senility in our senior 
citizens.
    The Children's Brain Diseases Foundation, begun in 1968, has had a 
direct role in stimulating interest in Batten disease worldwide by 
granting money to various investigators. The Foundation has sponsored 
six worldwide symposiums; the most recent in Helsinki, Finland, June 
1996. The next international symposium will be held in Dallas, Texas in 
June of this year. There are now over 100 investigators worldwide. 
Their work must continue to be encouraged and supported. Batten disease 
is now recognized worldwide.
    A major impetus to these advances occurred as a direct result of 
your committee's perseverance and interest which began to achieve 
fruition in 1991 when for the first time, the committee recognized that 
not enough attention was being spent on Batten disease, and they 
directed the National Institute of Neurological Disease and Stroke 
(NINDS) to expand its research in this direction.
    I am happy to say that the NINDS heeded your requests and 
suggestions and actively solicited research grants for Batten disease 
by sending out an official Request for Applications (RFA). A special 
committee was established to review Batten disease grants since it was 
felt that the usual committees did not have sufficient expertise to 
make proper evaluations. Numerous applications were received and a 
significant increase in money was spent on Batten disease research. In 
1994, $3,272,699 was spent. As a direct result of this, monumental 
events have occurred.
    In 1995, a group in Finland, in collaboration with the University 
of Texas, isolated the gene defect; mutations in the palmitoyl protein 
thioesterase gene localized on chromosome 1 p32, causing the infantile 
form of Batten disease. Also in 1995, the International Batten Disease 
Consortium isolated the genetic defect in the juvenile form of Batten 
disease and found it to be on chromosome 16 p12.1.
    In 1996, a group in England, headed by Doctor Mark Gardiner, 
identified the region that contains the gene for the classical late 
infantile form of Batten disease. It lies on chromosome 11p15 and the 
gene for a variant form of the late infantile, which lies on chromosome 
15q21-23. In 1997, a group led by Doctor Peter Lobel at the Center for 
Advanced Biotechnology and Medicine in new Jersey using a much faster 
novel approach of looking at lysosomal enzymes instead of concentrating 
on which of the 100,000 genes are defective, discovered the molecular 
basis for the late infantile form of Batten disease by identifying the 
single protein that is absent in late infantile Batten disease which 
sequence comparisons suggest is a pepstatin-insensitive lysosomal 
peptidase.
    It is now possible to make an absolute definitive diagnosis and 
determine carriers in all three childhood forms by a simple blood test, 
and to prevent the disease by genetic counseling, including in vitro 
fertilization.
    In spite of these unprecedented major significant breakthroughs, 
the NINDS in fiscal year 1997 has only spent $2,838,806 on research 
grants. This is 13 percent less than in 1994. We are at a loss to 
understand this and are afraid that this trend may cast a damper on the 
whole research processes. Our scientists are there. They are like 
expensive finely tuned complicated scientific machines and like all 
machines, they need fuel. Instead of traditional fuels, these 
individuals need American dollars in sufficient amounts so that they 
may pay for their expensive new scientific equipment as well as being 
able to hire the technical help necessary to expedite the research.
    Much needs to be done. The enzyme defects resulting from gene 
abnormalities in three of the four types must be determined. This 
should then lead to definitive therapy by gene replacement and/or 
specific enzyme therapy.
    We are cognizant of the difficulty in getting funds for research. 
However, the amount requested is a small price to pay to solve a 
disease which wrecks havoc on the victims and families and is draining 
our national resources by approximately 712 million dollars per year 
based on approximately 300 children born with Batten disease each year 
and others living with this disease at an average treatment and 
maintenance cost of over $150,000 per year for each year of life. This 
lifetime, in a vegetative state, can last 10 to 43 years.
Specific recommendations
    Although there have been four significant breakthroughs with regard 
to gene localization in Batten disease and the identification of the 
single protein that is absent in late infantile Batten disease, we were 
disappointed that the funding for fiscal year 1997 was approximately 13 
percent less than in fiscal year 1994. Consequently, we would like to 
suggest that the following wording similar to that which we recommended 
last year, be used in this year's appropriation bill:
    ``The Committee continues to be concerned with the pace of research 
in Batten disease. The Committee believes that the Institute should 
actively solicit and encourage quality grant applications for Batten 
disease and that it continue to take the steps necessary to assure that 
a vigorous research program is sustained and expanded. The Committee 
has requested that $3,470,000 within the funds available to the NINDS 
be spent on Batten disease research. This represents an average yearly 
increase of 4.1 percent since 1994. This will allow for $2,838,806 for 
continuation and renewal grants and $631,194 for new grants.''
                                 ______
                                 
    Prepared Statement of the American Academy of Family Physicians
    The 85,000 member American Academy of Family Physicians would like 
to submit this statement for the record on three issues of critical 
importance to our organization: appropriations for Section 747 of the 
Public Health Service Act for family practice training; appropriations 
for the Center for Primary Care Research at the Agency for Health Care 
Policy and Research (AHCPR); and funding for rural health programs.
                        family practice training
    The American Academy of Family Physicians strongly supports 
increased funding for Section 747 of the Public Health Service Act. 
Section 747 is the only federal program that provides targeted funding 
through grants for family practice residency training and funding for 
establishing and maintaining medical school departments of family 
medicine, predoctoral programs and faculty development. While Section 
747 must be reauthorized this year, it is currently authorized at $54 
million and received an appropriation of $49.4 million in fiscal year 
1998.
    The President's budget request is reported to contain level funding 
for Title VII (which includes Section 747) this year. Since this would 
be the first time in recent years that any President has begun the next 
year's budget discussion with a recommendation as high as level 
funding, we believe that value of this program is becoming more widely 
known and appreciated. While the Academy recommends a higher level, we 
are pleased with the Administration's request, as a starting point for 
our discussion.
Recommendation
    Based on a review of future needs of the country for a more 
appropriate number of family physicians, the Academy supports a fiscal 
year 1999 funding level of $87 million for Section 747. This 
recommendation would provide funds for 20 new and developing residency 
training programs, 12 new and developing departments, 24 medical school 
clerkships, 700 new faculty and a number of innovative demonstration 
projects. The recommendation is the result of a strategic plan 
developed by the Academic Family Medicine Organizations, which includes 
all five family medicine organizations.
Background
    Any attempts to control costs and maintain quality in the American 
health care system will be frustrated by a structural problem in our 
country: the shortage of generalist physicians. While in most countries 
at least 50 percent of physicians are generalists (family physicians, 
general internists and general pediatricians), the US physician 
workforce is made up of more than 70 percent subspecialists and only 30 
percent generalists. Family physicians make up only 13 percent of the 
total.
    Most experts believe that a physician workforce of at least 50 
percent generalists and 50 percent subspecialists would best meet 
America's health care needs. The Physician Payment Review Commission, 
Council on Graduate Medical Education, The PEW Commission, Institute of 
Medicine, American Medical Association and Association of American 
Medical Colleges all advocate increasing the supply of generalist 
physicians. A March, 1996, study by the Institute of Medicine 
encourages support for training of a primary care workforce.
    At one time, the physician workforce in the US was comprised of 50 
percent generalists, but after World War II, the nation's primary care 
workforce declined from a majority of the workforce to approximately 
one-third today. Public health service grants for medical education 
were a response to that decline, and the infrastructure they have 
helped establish is beginning to reverse the downward trend in primary 
care. During the 1990's, the number of medical students electing 
primary care residencies, and participating in family practice 
residencies, is increasing, however, the percentage is still only about 
one-third of graduating medical students. Much more progress is needed 
to begin to affect the national shortage. Section 747 support needs to 
be enhanced to provide a modest incentive for training more of the 
physicians America needs most.
    Medicare payment policies have contributed significantly to the 
overspecialization of physicians. These policies have promoted training 
in the expensive inpatient specialties that involve numerous procedures 
rather than in family practice and other generalist specialties. NIH 
funding also contributes to the overspecialization of physicians. NIH 
grants, amounting to billions of dollars, go primarily to the 
subspecialist projects in the nation's medical education complexes, 
providing powerful incentives to promote subspecialization to develop 
the capacity to secure grants.
    Moreover, a study conducted by KPMG Peat Marwick in September, 
1995, indicated that Medicare spending could be reduced by at least 
$48.9 billion and as much as $271.5 billion over the next six years if 
primary care physicians were 50 percent of the total physician 
workforce. The analysis revealed a direct correlation between the 
availability of primary care physicians and the reduction of health 
care costs. The Role of Primary Care Physicians in Controlling Health 
Care Costs: Evidence and Effects is a comprehensive review of existing 
studies on the role of primary care physicians in controlling health 
care costs.
    Section 747 is essential to provide at least a small incentive to 
offset the financial disadvantages that family medicine residencies and 
departments face. Until Medicare GME preferentially supports primary 
care training, and until primary care medical research is funded at 
more than a tiny fraction of subspecialist research, family practice 
residency programs and medical school departments will remain highly 
dependent on grants from Title VII.
    Finally, let me emphasize that Title VII funding is still 
important, regardless of changes made to graduate medical education. 
Specifically, Title VII dollars go to medical schools and universities 
to develop a primary care infrastructure, while GME funds go primarily 
to hospitals to support residency training. Further, the cutbacks in 
indirect medical education may adversely affect graduate training of 
primary care physicians.
Family Practice Training Programs are Important to Meet the Nation's 
        Health Care Needs
  --Family physicians are distributed in urban and rural areas in the 
        same proportion as the US population as a whole--unlike any 
        other physician specialty. Even so, 149 counties representing 
        550,000 individuals have no physician at all. In addition, 
        family practice residency training programs that receive 
        Section 747 funding place greater numbers of graduates who 
        locate in rural and underserved areas than programs that do not 
        receive that funding.
  --In community health centers, which rely heavily on primary care 
        physicians, 52 percent report difficulty recruiting primary 
        care physicians.
  --The U.S. population 65 years of age and older will rise about 2 
        percent per year between now and the year 2020. Older people 
        will require a wide range of health care services, including 
        preventive, primary, long-term, rehabilitative and hospice 
        care--services that will require a substantial increase in the 
        number of family physicians.
             data and outcomes that prove section 747 works
Family practice residency programs
    Over 90 percent of physicians who complete family practice 
residency programs work in direct primary patient care and are able to 
handle 85-90 percent of their patient's problems. (By contrast, over 
half of internal medicine residents subspecialize along with one-third 
of pediatric residents.) Section 747 grants to family practice 
residency programs have helped increase the number of training programs 
from 175 to 388 between 1975 and 1998. However, the nation needs 20-30 
new programs and significant expansion of many existing programs to 
achieve a balanced workforce.
    In contrast to other specialties, 80 percent of family practice 
residencies are located in community settings rather than in major 
tertiary care teaching hospitals. These residencies provide more 
ambulatory training than any other residencies. As a result, family 
practice programs do not have access to the considerable resources that 
flow to teaching hospitals. Further, 25 percent of family practice 
residencies are located in public hospitals. These hospitals receive 
low reimbursement for patient care services, and treat fewer Medicare 
patients. As a result, they do not receive substantial Medicare 
graduate medical education dollars. Section 747 is vital to the 
survival and expansion of these critical residency programs.
Family medicine departments in medical schools
    Section 747 grants for establishing departments of family medicine 
have resulted in ten new departments in the past eight years. However, 
twelve of the nation's 124 medical schools still do not have 
departments of family medicine. An October, 1994 GAO report indicated 
that ``students who attended schools with family practice departments 
were 57 percent more likely to pursue primary care.'' The same report 
indicated that ``students attending medical schools with more highly 
funded family practice departments were 18 percent more likely to 
pursue primary care.'' Section 747 dollars are crucial to establishing 
these family practice departments and to graduating students into 
primary care careers, as well as to keep these important departments 
financially solvent.
Predoctoral programs
    Section 747 funding for predoctoral under encourages medical 
schools to create required third-year clerkships in family medicine. 
However, 24 of the nation's 124 medical schools still do not have 
required third-year clerkships in family medicine. Requiring a third-
year clerkship of more than four weeks duration results in 15.6 percent 
of a school's graduates choosing careers in family medicine, compared 
to 6.9 percent of the graduates of schools without required third-year 
clerkships. Moreover, the October, 1994 GAO report indicated that 
``students who attended schools requiring a third-year family practice 
clerkship were 18 percent more likely to pursue primary care.'' Section 
747 funding has increased the number of medical schools with clerkships 
to 100, but continued funding is necessary to maintain and increase 
that number to all schools.
Faculty development
    There is an acute shortage of faculty for family practice residency 
programs and family medicine departments as the discipline has been 
successful at placing its graduates in practice settings serving 
communities of need rather than in full-time faculty positions. Without 
adequate funding, there is a risk that even the progress that has been 
made so far will be compromised for lack of faculty.
               agency for health care policy and research
    While American medicine is praised worldwide for its excellence in 
biomedical research, it has often failed to translate these 
breakthroughs to practical treatment that will apply to the population 
at large. It is imperative that US research facilities complement their 
superb understanding of high-tech research with a similar dedication 
both to applying state of the art medicine to primary care settings and 
research to improve the delivery of primary care and preventive 
medicine so that there is less of a need for high-tech subspecialty 
care.
Recommendation
    The Academy requests that additional appropriations be provided to 
the Agency for Health Care Policy and Research (AHCPR), and that 
dollars be targeted specifically to the Center for Primary Care 
Research. We believe that supplementary funding, coupled with direction 
from Congress, will permit AHCPR to address primary care issues. We 
recommend $50 million for this effort. In view of Administration 
recommendations for substantially increased funding for the National 
Institutes of Health, we ask that you consider additional dollars for 
the Agency for Health Care Policy and Research as a part of this 
initiative. It is equally important that we find ways to extend state 
of the art medicine to primary care physicians as it is to develop the 
state of the art of medicine further.
Background
    The Academy strongly supports the Center for Primary Care Research 
within AHCPR. The Academy supported AHCPR's establishment and, in 
particular, the agency's statutory authority to support clinical 
practice research to include primary care and practice-oriented 
research. In fact, the 1992 Senate Report 102-426 accompanying Public 
Law 102-410, which reauthorized AHCPR most recently, states that the 
Agency should strengthen its commitment to family practice and primary 
care research. The report asserts that: ``The committee believes that 
inadequate attention has been given to conditions that affect the(se) 
vast majority of Americans--that is, the undifferentiated problems 
individuals present to their generalist physicians. A focus on family 
practice/primary care research is essential if we are to redirect the 
US health care system that is currently skewed toward high technology 
medicine for catastrophic diseases.''
    Although over 95 percent of all medical conditions have been 
evaluated and treated outside of hospitals over the last 30 years, 
physicians are educated and trained using a knowledge base derived from 
hospitalized patients, or patients with complex conditions who were 
referred to specialists. This base of knowledge has frequently little 
relevance to the basic, entry-level concerns that affect most people. 
As a result, American health care is tilted toward institutions and 
systems that employ highly technological methods to treat catastrophic 
and end-stage disease. The consequences of this situation are serious; 
the US health care system has inadequate emphasis on cost-saving 
preventive care, scarce medical resources are delivered inefficiently, 
and costs continue to spiral upward.
Primary care research
    As a result, a primary care research agenda is crucial. This agenda 
should be designed to provide new tools to family physicians and other 
generalist physicians as they serve the millions of patients they see 
each year. Such an agenda would include research to improve diagnostic 
accuracy because most people go to doctors with cluster of ill-defined 
symptoms. The job of the generalist physician is to make sense out of 
these symptoms; determining whether or not they constitute a short-term 
problem or one requiring ongoing or intensive treatment, and then 
initiating effective therapy. Primary care research would assist 
physicians in streamlining the diagnostic process and increasing 
accuracy while at the same time reducing their use of expensive, 
unnecessary or potentially dangerous medical tests.
    Finally, generalists and subspecialists must learn to work together 
to provide a continuum of appropriate medical care. Familiar symptoms 
such as chest pain, headache, fatigue and insomnia bring millions of 
Americans to their physicians each year, symptoms that may or may not 
represent serious conditions. It is imperative that generalists and 
subspecialists work together to discern the causes, evolution and 
management of human suffering.
                         rural health programs
    Finally, the Academy supports continued funding for several rural 
health programs. In particular, we support the State Offices of Rural 
Health, the Federal Office of Rural Health, Area Health Education 
Centers and the National Health Services Corps (NHSC). We are pleased 
that the President's budget is reported to protect most of these 
important programs, including the NHSC and the Rural Community and 
Migrant Health Centers. In addition, adequate funding for the State 
Offices of Rural Health is necessary to permit states to implement the 
provisions of the Balanced Budget Act of 1997 expanding children's 
health insurance and to ensure that they are of the same value to rural 
residents as they are to urban dwellers. Continued funding for these 
rural programs is vital if we wish to provide adequate health care 
services to America's rural citizens.
Conclusion
    Several key federal health programs focus on meeting the needs of 
the American people. At a time when policymakers are critically 
reviewing government programs for their cost-effectiveness and overall 
value, Section 747 is a program that scores high on both fronts; it 
works. On behalf of the American Academy of Family Physicians, we ask 
you to appropriate funding for Section 747 of $87 million. In addition, 
scant research is available on basic patient care. The American Academy 
of Family Physicians recommends $50 million for the Center for Primary 
Care Research at the Agency for Health Care Policy and Research. 
Finally, we ask for continued funding for the rural health programs 
that help provide health care to rural Americans.
    Thank you for your attention to these important requests.
                                 ______
                                 
         Prepared Statement of the American Nurses Association
    The American Nurses Association (ANA) appreciates this opportunity 
to comment on fiscal year 1999 appropriations for nursing education, 
nursing research, and workforce programs.
    ANA is the only full-service professional organization representing 
the Nation's 2.5 million registered nurses, including staff nurses, 
nurse practitioners, clinical nurse specialists, certified nurse 
midwives and certified registered nurse anesthetists through its 53 
State and territorial nurses association.
    We gratefully acknowledge this Subcommittee's support for nursing 
education and research. You have continued to recognize the importance 
of nurses in health care delivery and have funded programs for nursing 
education and innovative practice models. We believe that our shared 
goal of ensuring the nation of an adequate supply of well-educated 
nurses, to meet the increasing demands of our rapidly changing health 
care system, will reaffirm the need for continued funding of these 
programs. Today, we offer our professional recommendations for Federal 
funding of nursing education, nursing research and workforce programs.
  department of health and human services programs nurse education act
    More than 100,000 advanced practice nurses--registered nurses with 
education and clinical experience generally at a master's degree 
level--are providing primary care in the place of physicians or are 
providing an expanded type of primary care, either as nurse 
practitioners, certified nurse midwives or clinical nurse specialists. 
Due to unprecedented changes in our health care delivery system and the 
changing demographics and complexity of care, nurse practitioners will 
be in increasing demand and the nurse education system will be 
stretched to provide first-quality training for them. These changes 
call for the fullest utilization possible of the multi-disciplinary 
providers who care for patients and families in an ever-increasing 
array of settings: hospitals, subacute care facilities, rehabilitation 
facilities, long term care facilities, schools and universities, 
workplaces and communities.
    Federal support for nursing education in Title VIII of the Public 
Health Service Act (PHSA) is unduplicated and essential to achieve 
future goals for the public's health. Under current law, specific 
authorizations are made for nurse practitioners/nurse midwives; 
professional nurse traineeships; nursing special projects; advanced 
nurse education; nurse anesthetists; and disadvantaged assistance. 
Although the Nurse Education Act was not reauthorized during the 104th 
Congress, a proposal will soon be introduced that would give the 
Secretary of Health and Human Services broad discretion to determine 
which projects to fund, with priority given to projects which would 
substantially benefit rural or underserved populations, including 
public health departments. In this proposal, the Division of Nursing 
would have the needed flexibility to focus on curriculum development 
and other programs to help change the focus of nurse education from 
acute care settings to the preparation of more nurses who are able to 
function where there is a greater demand. It would also better address 
the need for increasing the numbers of minority nurses available to 
provide culturally competent, linguistically appropriate health care 
services to underserved communities. These nurses would be better 
prepared to assist these populations in changing the way they access 
our health care system, and in helping these patients understand the 
advantages of developing relationships with primary providers. By 
itself, the behavior change from accessing health care services through 
emergency departments to one in which the consumer routinely seeks care 
through a primary provider decreases health care costs exponentially.
    As work on a reauthorization proposal progresses, it is crucial 
that the Division of Nursing be able to continue the administration of 
nursing education programs until the new programs can be implemented. 
For fiscal year 1998, the Nurse Education Act was funded at $65.6 
million. For fiscal year 1999, we are requesting an increase in funding 
of 8 percent over fiscal year 1998 funding to fund the Nurse Education 
Act programs at $70.8 million. The following provides a brief 
description of these programs, along with the fiscal year 1999 
individual funding recommendations.
Nursing special projects (section 820)
    Title VIII of the PHSA is the only specific source of funds for 
innovation in nursing practice. Examples of innovation include nurse 
managed clinics, fifty percent of which have been developed or expanded 
with Title VIII support. The dramatic shift in health care delivery 
systems from inpatient to outpatient settings further emphasizes the 
need for workforce retraining and the development of new programs to 
address this educational need. We recommend funding at $11.4 million.
Nurse Practitioner and Certified Nurse-Midwife Program grants (section 
        822)
    Advanced practice continues to hold the nation's greatest promise 
of providing primary care access in rural, inner-city and underserved 
areas of the country. Title VIII of the PHSA has provided support to 
more than 80 percent of the nurse midwifery programs in the U.S. and 60 
percent of the nurse practitioner programs in the country. We recommend 
funding at $19 million.
Nursing education opportunities for individuals from disadvantaged 
        backgrounds (section 827)
    Over-utilization of costly emergency care, decreased access to 
primary care providers and a general lack of trust in the health care 
system has frequently been attributed to the lack of representation of 
minorities among health care providers. Funds from Title VIII of the 
PHSA have increased the number of minority nurses available to provide 
culturally competent, linguistically appropriate health care services 
to underserved communities. Evaluative studies have determined that 
this program has been the driving force behind many of the efforts 
nationwide to increase diversity in the nursing profession. We 
recommend funding at $4.1 million.
Traineeships for advanced education of professional nurses (section 
        830)
Nurse anesthetists (section 831)
Advanced Nurse Education Program (section 821)
    Nursing education at the graduate (master's and doctoral) level 
provides the skilled clinicians for promoting excellence in practice 
and the faculty needed to maintain the nursing education pipeline. 
Professional nurse traineeships under Title VIII of the PHSA support 
over 93 percent of all full-time graduate students in nursing. 
Preference is given for traineeship programs which provide significant 
learning experiences at rural health facilities and those where 
students come from health professional shortage areas. We recommend 
funding for Professional Nurse Traineeships at $17.2 million, Nurse 
Anesthetists program at $2.9 million and Advanced Nurse Education 
Programs at $13.5 million.
Nurse loan repayment (section 836)
    This program provides for up to 85 percent repayment of student 
loans for nurses who agree to a service payback in nursing shortage 
areas. We recommend funding at $2.3 million.
National Institute of Nursing Research (NINR)
    The second funding priority for nursing is funding for the NINR, on 
the campus of the National Institutes of Health (NIH). We applaud this 
Subcommittee's commitment to advancing behavioral science research. 
Nursing research is an integral part of the effectiveness of nursing 
care. The NINR provides the knowledge base for practice of 2.5 million 
registered nurses. Advances in nursing care arising from nursing and 
other biomedical research improves the quality of patient care and has 
shown excellent progress in reducing health care costs and health care 
demands. The trend for earlier discharge from the hospital can 
potentially reduce hospital charges, but patients may and frequently 
require rehospitalization, increased acute care visits, and home care 
that families may be unable to provide. Research funded by NINR has 
shown that a model consisting of a carefully planned hospital early 
discharge program with follow-up care in the home by nurse specialists 
can result in improved recovery of patients at substantially reduced 
health care costs. The model was tested on three groups of women. 
Hospital costs were reduced by an average of 38 percent for diabetic 
mothers and their babies; 29 percent for mothers with cesarean births 
and their babies; and 6 percent for women undergoing hysterectomies. 
Moreover, the women had fewer rehospitalizations and expressed greater 
satisfaction with their care. This model needs further testing in 
different patient populations. However, if its initial promise holds 
true for other groups of hospital patients, then earlier discharge with 
qualified home follow-up care can improve recovery and save 
increasingly scarce health care dollars. While we support the 
Administration's proposed 8.4 percent increase above fiscal year 1998 
funding of $63.5 million for this program, we recommend a 15 percent 
increase to fund NINR at $73 million.
Substance Abuse and Mental Health Services Administration (SAMHSA) 
        Clinical Training Program
    The SAMHSA Clinical Training Program has been a major source of the 
nation's mental health clinical training funds, and is a source of 
funding for ANA's Minority Fellowship Project (MFP). Since fiscal year 
1994 the program had been funded at $2.5 million. The funding is 
allocated through SAMHSA to the minority mental health training 
programs in Nursing, Psychology, Social Work and Psychiatry. The MFP 
graduates have an outstanding record of public service to minority and 
indigent communities.
    MFP graduates receive doctoral degrees and work as teachers in 
schools of nursing that serve minority students. They serve as role 
models and provide leadership to future nurses. As clinicians, 
graduates work in high risk urban and rural areas providing care to 
children and families who are victims of violence, HIV/AIDS, and 
substance abuse as well as the mentally ill. Nurses work in community 
based clinics and outreach programs and often are the primary care 
providers for indigent clients who might otherwise go without needed 
mental health services. In addition, these nurses generate research on 
minority mental health services, treatments and client outcomes. 
Culturally appropriate research helps us to identify ways to provide 
services faster and to more people, ultimately improving health care 
outcomes and reducing health care costs. This works to change the poor 
health outcomes and high risk health status that continues to plague 
minority communities. Unfortunately, last year this program was only 
funded at slightly above $1 million. We believe this program is a good 
investment in reducing mental health care costs and recommend funding 
of $1.5 million for fiscal year 1999 for the SAMHSA Clinical Training 
program.
AIDS Education and Training Centers (AETC)
    The AETC program in the Bureau of Health Professions at the Health 
Resources and Services Administration provides specialized training for 
health care personnel who care for patients with AIDS. Emerging and 
evolving scientific information with profound impact on individual and 
public health requires a ready network for information dissemination 
and technology transfer. AETC's reduce care costs, promote private 
sector voluntarism and ease the suffering of families and communities. 
It is for this reason that we recommend a funding level of $25 million 
for fiscal year 1999 for the AETC's.
The National Institutes for Occupational Safety and Health (NIOSH)
    NIOSH is the only federal agency with the mission to conduct 
research and develop practical solutions to prevent work injury and 
illness. NIOSH played a key scientific role in the development of the 
bloodborne pathogens standard. This standard provides significant 
protection to front-line health care providers from possible exposure 
to bloodborne pathogens, such as HIV, Hepatitis-B and Hepatitis-C. In 
addition, NIOSH funds Educational Resource Centers. These multi-
disciplinary, university based occupational health and safety training 
and research centers as the primary vehicle for the development and 
training of a corps of trained occupational health nurses and other 
safety professionals. We recommend fiscal year 1999 funding of $153 
million for NIOSH.
                other workforce funding recommendations
    As an advocate for the economic and general welfare of registered 
nurses, the American Nurses Association also recommends appropriate 
funding for the Department of Labor and related agencies that serve to 
ensure a safe and fair workplace. ANA believes the work done by the 
Bureau of Labor Statistics, with respect to the ongoing collection and 
analysis of employment and economic data, is necessary for tracking 
changing economic conditions and essential to making workforce 
projections. We urge your support of the Bureau.
National Labor Relations Board (NLRB)
    ANA is concerned about the ability of the NLRB to meet its 
statutory responsibility of enforcing and interpreting the National 
Labor Relations Act (NLRA). Current cutbacks have created delays in 
processing of complaints and holding representation elections thus 
jeopardizing the progress in employee and employer relations. ANA 
considers this a core independent agency function that must be 
preserved. We recommend fiscal year 1999 funding of $184 million for 
the NLRB.
Occupational Safety and Health Administration (OSHA)
    The rapid restructuring of the health industry has increased and in 
some cases exacerbated the risk of exposure to illness and injury for 
nurses and other health care workers. Hospitals and HMOs are downsizing 
both to cut costs and be competitive in the health care marketplace. 
These economic pressures have led to a reduction in the number of 
registered nurses providing care at the bedside. The remaining nurses 
in these acute care settings have to work harder and take care of more 
and sicker patients than ever before. The nurses themselves are 
sustaining more frequent incidences of injury and illness. According to 
the Bureau of Labor Statistics, in 1993, back and shoulder injuries 
accounted for 50 percent of the 31,422 injuries and illnesses that kept 
registered nurses away from work. Overall, lifting was specified as the 
cause of 26 percent of all registered nurse injuries. ANA is concerned 
about these increased incidences and adamantly opposes any proposal 
which would prevent OSHA from developing an ergonomic regulation.
    Overall, there are an estimated 50,000 deaths per year that result 
from illnesses caused by workplace chemical exposures and 6 million 
nonfatal workplace injuries that occur annually. Budgetary reductions 
place OSHA at risk in meeting its statutory responsibility of 
establishing and enforcing national health and safety standards. ANA 
continues to be concerned about the strength of the Office of 
Occupational Health Nursing and its parity with similar offices. 
Occupational health nurses are the largest group of health care 
providers at the Nation's worksites. As such, they are uniquely 
qualified to assess the practical realities of work sites and related 
regulatory activities. This office must be fully staffed in order to 
accomplish its critical task of linking the ongoing work of 
occupational safety and health nurses to OSHA. We support the 
Administration's recommendation for fiscal year 1999 funding of $355 
million for OSHA.
                               conclusion
    We appreciate the opportunity to comment on funding for nursing 
education, research and workforce programs. We thank you for your 
continued support and look forward to working with you as you proceed 
through the appropriations process.
                                 ______
                                 
Prepared Statement of Karen Murray, Member, National Marfan Foundation, 
on Behalf of the Coalition for Heritable Disorders of Connective Tissue
    Mr. Specter and members of the subcommittee, the members of the 
Coalition for Heritable Disorders of Connective Tissue (CHDCT) thank 
you for the opportunity to provide testimony regarding the budget of 
the National Institutes of Health.
    I am Karen Murray, Member of the National Marfan Foundation which 
is a charter member organization of the Coalition for Heritable 
Disorders of Connective Tissue (CHDCT). The Coalition is an umbrella 
group, founded in 1988, which represents more than one half million 
Americans affected by heritable disorders of connective tissue. There 
are more than 200 such disorders which include names most of us have 
never heard of unless or until a family member is diagnosed with one--
names such as Ectodermal Dysplasias, Ehlers-Danlos Syndrome, 
Epidermolysis Bullosa, Osteogenesis Imperfecta, Pseudoxanthoma 
Elasticum, the Chondrodystrophies, and Marfan Syndrome, to name some of 
the more common ones. They are genetic disorders that have existed for 
centuries, yet most people do not know their names; although many 
people will recognize the name of the sheep Dolly, cloned last year.
    My son, Michael, was born August 13, 1991, 6 years ago, in one of 
the top hospitals in New York City. He was born with a dislocated hip, 
long fingers bent backward at the knuckle, and an indented chest. I 
overheard the physicians discussing among themselves, but not directly 
with me, the possibility of ``Marfan syndrome.'' They sent Michael and 
me for echocardiograms, pronounced us fine, and released us from the 
hospital. The same doctors followed Michael for the next five years, 
during which time, Michael grew faster, longer, taller and more 
awkwardly than his peers and his indented chest became more severe. I 
went to all kinds of specialists: pediatrician, orthopedic surgeon, 
neurologist, occupation/physical therapist, pulmonist, all but 
cardiologist. I would constantly describe Michael's symptoms: ``Why is 
my son so tall, thin, Awkward, loose-ligamented, indented chest, long 
fingers, arms, legs, narrow hands?'' I was told to let it go, he's 
beautiful, he's fine.
    I knew there was something wrong.
    For Michael's 5th birthday, I bought him a computer which came with 
a free CD ROM called ``The Family Doctor.'' Late one night, I clicked 
into it and recognized the words ``Marfan syndrome'' under the subject 
heading, ``Rare Disorders.'' The first paragraph read ``Children with 
Marfan syndrome grow taller than their peers, they have indented or 
protruding chest bones, fingers are disproportionately long, excessive 
joint mobility, muscle weakness * * *'' and so on. The next morning, I 
brought him back to the same prominent New York City hospital where he 
was born and five hours later, after an echocardiogram, the diagnosis 
of Marfan syndrome was confirmed.
    Marfan syndrome is a genetic disorder that affects the connective 
tissue throughout the body--in almost all cases, it affects the heart 
and aorta. Approximately 200,000 Americans are affected by Marfan 
syndrome and related connective tissue disorders, but diagnosis 
requires an assessment of the three primary body systems: orthopdeic, 
ophthalmological and cardiovascular. Early diagnosis and careful daily 
management of someone with the Marfan syndrome is critical. At the time 
of Michael's diagnosis, his aorta was already very dilated. Severe 
dilation can lead to dissection which is what we know as an aneurysm. 
If medical personnel can't recognize the signs, the outcome is usually 
fatal.
    My point is this: Doctors at the best hospital in New York City, 
extremely aware of Marfan syndrome--and whom suspected Marfan syndrome 
at Michael's birth--were not able to make the diagnosis. My son, 
Michael, in the hands of the best medical personnel in NYC, slipped 
away. Had I not heart the word ``Marfan'' or bought a computer, Michael 
could have been another statistic in his teens. But it doesn't have to 
be that way. Although Marfan syndrome is incurable, and a progressive 
disorder, it is diagnosable and treatable. Doctors and emergency room 
personnel need to be better educated in the recognition and treatment 
of Marfan syndrome. I am sure that if the best hospital in New York 
City didn't catch it, there are few other hospitals that will without 
considerable efforts to educate and increase awareness. As a parent of 
a Marfan child who is six years old--I'm nervous but optimistic Michael 
will be OK. I was lucky. I had the money to buy a computer and the 
persistence to keep looking because I always knew something wasn't 
quite right. I now know to have his heart monitored every three months. 
I'm having his orthopedic issues dealt with now. I have him on 
medication in the hope that his aorta will be less stressed. But there 
is still so much I don't know and I am told, ``Sorry--we haven't 
research that yet--especially for children.'' As was almost the case 
with Michael, those children who go undiagnosed and untreated will, in 
most cases, die at a young age. Today, tens of thousands of people are 
undiagnosed. As a parent, I have questions that keep me awake at night. 
I wish I had enough money to fund research programs to answer some of 
my questions.
    For example: I'm giving Michael calcium channel blockers daily--his 
aorta hasn't grown but what side effects will there be after years of 
calcium channel blockers?
    Can and should Michael exercise? Take gym class?
  --What's more effective--surgery or a brace to treat Marfan scoliosis 
        in children?
  --Do children with Marfan syndrome have weak tissue in their 
        respiratory system and is that why Michael has asthma?
  --Are spontaneous mutations more severely affected than those who 
        have inherited Marfan?
  --Since Michael has so many orthopedic issues, what can I do to help 
        him live with less chronic pain?
  --I'm scared to have another baby. Are there tests I can take to 
        determine health of a fetus?
  --Why do Marfans' lungs collapse?
  --With such hefty medical bills, will a company employ him?
    Undiagnosed Marfan patients end up in the emergency room. The 
emergency room staff does not know what to look for and thus many 
Marfan patients do not receive the tests that could save their lives. 
The key is to build awareness and educate the medical community from 
ObGyn's to pediatricians to emergency room doctors so that they can 
recognize and diagnose Marfan syndrome. Early diagnosis and careful 
management is critical in order to preserve and enhance the life of a 
Marfan patient.
    The greatest challenges lie ahead of us. It is hoped that a firm 
understanding of Marfan syndrome and its cause, and the development of 
relevant animal models, will enable researchers to devise novel 
strategies for the prevention and cure of this and related disorders of 
connective tissue.
    Similar challenges are faced by the other heritable disorders of 
connective tissue. Dystrophic Epidermolysis Bullosa mutations have been 
identified in several families, identifying the mutations of a specific 
collagen in Dominant Dystrophic EB. DNA-based prenatal diagnosis is 
looked to as a means of saving the lives of babies affected with EB. 
Much of the research that paved the way for these and other advances 
has been supported by the Committee.
    Ehlers-Danlos (EDS) is a group of disorders caused by a defect in 
connective tissue. EDS is characterized by joint laxity, soft, 
hyperextensible skin, and tissue fragility. Manifestations are usually 
found in the joints, skin and vascular system. The degree of severity 
varies from type to type and even within each type. In some types, 
researchers have detected the specific gene affected and there are 
biochemical tests available to diagnose those types. Researchers are 
able to use that knowledge to understand how the gene abnormality 
results in an abnormal protein which then results in EDS.
    Osteogenesis Imperfecta (OI) is characterized by bones that break 
easily, often from little or no apparent cause. Most forms of OI are 
the result of imperfectly formed bone collagen, the consequence of a 
genetic defect. Research into treatments and a cure for OI shows great 
promise, thanks to individual donors, the Department of Defense, and 
public-private partnerships. Skin and DNA diagnostic tests are 
available, as well as a prenatal test. The OI Team at the DuPont 
Hospital for Children in Wilmington, DE, has developed a comprehensive 
database containing extensive information on a wide variety of clinical 
features of OI. Merck Research Laboratories and Shriners of North 
America are studying the efficacy of alendronate at 16 hospitals. At 
NIH, a clinical study is underway to assess the effects of braces on 
upright activity. A growth hormone study is starting up. Bone marrow 
transplants are being studied at St. Jude's Research Hospital in 
Memphis, TN. Like our growing database, each new piece of information 
is available for researchers to build on, to speed our progress toward 
a cure.
    Pseudoxanthoma Elasticum (PXE) is a connective tissue disorder that 
affects skin, eyes, gastrointestinal and cardiac systems. It can lead 
to central vision loss, heart disease and life threatening 
complications. During the past year, the gene locus for PXE was 
discovered. This very significant discovery was elucidated at the 
International Centennial Meeting on Pseudoxanthoma Elasticum in 
November 1997 in Bethesda, MD. This meeting, attended by 50 scientists, 
was funded by the NIH. It has energized the research community and 
provides substantial direction for the coming years. Several labs, 
funded in part with NIH grants for PXE, are working on finding the 
gene, discovering the mutations, understanding the effect of these 
mutations and searching for applicable treatments. Funds from the NIH 
make a substantial difference in the recently accelerated pace of 
research on this devastating disease. We are particularly concerned 
that clinical research funding be supported, as this will become a 
major focus of PXE research in the coming years.
    Ectodermal Dysplasias are a group of over 150 genetic disorders 
identified by abnormalities in two of more derivatives of the ectoderm. 
Researchers have localized the genetic abnormalities of X-linked 
hypohidrotic ectodermal dysplasia to a specific region on the X 
chromosome and can now predict the probability that a female is a 
carrier of the syndrome through DNA analysis.
    Sticklers syndrome has gained increasing prominence and awareness 
in the medical profession. Every parent's hope is for a life without 
pain for their child. Stickler parents know that that hope lies in 
finding a cure. First steps are being taken by the National Human 
Genome Research Institute. A five year study has been undertaken to 
better understand this complex syndrome and other connective tissue 
disorders. Additional funding is needed to accelerate the study and 
cover a broader base. The immediate benefits in research on the 
Stickler syndrome are improved sites for knowledgeable diagnoses and 
improved therapies which provide hope. There is no more worthy place 
for our tax dollars.
    Many exciting discoveries have been occurring in the 
Chondrodysplasias. After years, the gene has been identified for 
achondroplasia--one of the most common forms of dwarfism. This 
condition, caused by a gene mutation early in fetal development, occurs 
in one of every 20,000 births. Following upon this discovery was the 
identification of the gene mutation for diastrophic dwarfism, a 
recessive form. Additional positive research is being directed toward 
the goal of alleviating orthopaedic, neurological and respiratory/
pulmonary conditions which can be lethal and have only partially 
effective surgical interventions.
    The advances in genetic research to date bring hope to the many 
individuals and families affected by heritable disorders of connective 
tissue. Yet more dollars are needed to continue the momentum necessary 
to understand these complex disorders and to translate molecular 
findings into practical therapies.
    In 1995 a workshop on Heritable Disorders of Connective Tissue was 
held at the National Institutes of Health at the recommendation of your 
committee. This workshop was a follow up of an earlier conference held 
in 1990. The workshop was critical in updating basic research findings, 
and translating these findings into practical clinical investigations. 
It served as a forum for scientists involved in connective tissue 
research and enabled the participants to focus on, and recommend, 
directions for future studies. It will soon be time to reconvene these 
collaborators in view of the rapidly changing technologies and genetic 
information.
    A higher level of investment is needed to continue at an 
accelerated rate the science and the tools of the past decade. The 
CHDCT recognizes that the fundamental way science is conducted is 
changing at a revolutionary pace. It requires investment in new 
technologies, superspeed computer networks, new infrastructure and 
personnel with new sets of skills.
    Research will lead to treatments and preventions that will stop 
this tragic economic and social drainage of money and spirit and will 
permit thousands of children and adults to realize their full potential 
as Americans. The American dream, for those with genetic disorders, can 
be attainable if we support the high quality of research that is 
currently underway.
    Many of these disorders, although incurable at the present time, 
are treatable. We stand on the edge of an extraordinary time. The 
discoveries of science and technology of the past few years provide a 
promise that is breathtaking and provides hope to all suffering from 
these disorders.
    We support the proposal of the Ad-Hoc Group for Medical Research 
Funding which calls for a 15-percent increase in funding for the NIH in 
fiscal year 1999 as the first step toward doubling the NIH budget over 
5 years. We recognize the difficulty in achieving this goal under the 
current spending limits, and encourage the Congress to explore all 
possible options to identify the additional resources needed to support 
this increase.
    Please help fund these important programs so that I can learn more 
about how to care for Michael, so we can make the medical community 
more aware of Marfan syndrome and Heritable Disorders of Connective 
Tissue so that a timely diagnosis can be made and a life can be saved. 
All the member organizations of the Coalition for Heritable Disorders 
of Connective Tissue and the patients and families they represent, join 
me in thanking this Committee and Congress for continuing support of 
research on Heritable Disorders of Connective Tissue.
                                 ______
                                 
  Prepared Statement Leonard H. Finkelstein, D.O., Chairman, Board of 
  Governors, American Association of Colleges of Osteopathic Medicine
    Dear Mr. Chairman:As President of the Philadelphia College of 
Osteoapthic Medicine (PCOM) and Chairman of the Board of the American 
Association of Colleges of Osteopathic Medicine (AACOM), I am pleased 
to present the views of the 19 AACOM member schools on fiscal year 1999 
funding for health professions educational assistance programs under 
Title VII and Title VIII of the Public Health Service Act. 
Specifically, we urge the Subcommittee to provide a funding level of 
$306 million for these programs, which is only about four percent over 
the fiscal year 1998 level approved by Congress last year.
    AACOM is proud that the model of osteopathic medical education 
actively furthers the Federal objectives of addressing physician 
geographic maldistribution in the United States and increasing access 
to primary care services. I must point out that this model has not been 
developed recently in response to Federal funding requirements. Rather, 
it has been at the core of our osteopathic medical education for over 
one hundred years. AACOM member schools have a long history of 
dedication to training primary care physicians to work in America's 
smaller communities, rural areas, and underserved urban areas. Indeed, 
the mission statement of my institution, PCOM, states that we are 
``committed to educating community responsive, primary care-oriented 
physician prepared to practice medicine in the 21st century.''
    The health professions assistance programs under Title VII of the 
Public Health Service Act have been valuable in our efforts to ensure 
this commitment. Numerous programs are particularly important to 
enhancing osteopathic medical schools' ability to train the highest 
quality physicians. Among these programs are: General Internal Medicine 
Residencies; General Pediatric Residencies; Family Medicine Training; 
Preventive Medicine Residencies; Area Health Education Centers; Health 
Education and Training Centers; Health Careers Opportunities Programs; 
Centers of Excellence; and Geriatric Training Authority.
    Title VII also authorizes student assistance programs that are 
important to osteopathic medical students. Forty-eight percent of our 
students come from families with annual incomes under $40,000. This 
Subcommittee must be concerned with minimizing the debt load of our 
graduates if they, in turn, can be expected to hold down medical costs, 
practice in primary care specialties, and locate in underserved areas. 
In addition, Exceptional Financial Need Scholarships, Financial Aid for 
Disadvantaged Health Professions Students, and Scholarships for 
Disadvantaged Students are all programs that must be maintained if we 
are to ensure access to medical education by underrepresented groups.
    Mr. Chairman, AACOM strongly recommends full funding to restore the 
Health Education Assistance Loan (HEAL) Program. Effective October 1, 
1995, a phase-out of the HEAL program began. Since that date no HEAL 
loans have been available to first-time borrowers. This action has 
created a special hardship for osteopathic medical students who relied 
more heavily on HEAL than any other source of financial assistance. 
This is especially unfortunate in light of the fact that osteopathic 
medical students have had the lowest default rate among all health 
professions students who have HEAL loans.
    It is our understanding that legislation to restore the HEAL 
program will be introduced soon. In anticipation of this 
reauthorization, we request that the Subcommittee restore full funding 
for the HEAL program.
    Mr. Chairman, in conclusion, the efforts of the Subcommittee in 
support of health professions educational assistance programs have been 
most encouraging. We look forward to your continued support.
                                 ______
                                 
 Prepared Statement of George Coling, Executive Director, on Behalf of 
                    the National Fuel Funds Network
    The National Fuel Funds Network (NFFN) thanks the Subcommittee for 
the opportunity to submit this testimony. NFFN supports funding for the 
Low Income Home Energy Assistance Program (LIHEAP) at no less than $1.3 
billion for fiscal year 1999. NFFN also strongly supports the advance 
appropriations, enacted in November 1998, for fiscal year 2000 funding. 
Our nation must respond to needs of the growing number of low-income 
elderly and the needs of those in poverty. Those numbers are not 
decreasing. Therefore, we ask that the fiscal year 2000 appropriation 
be increased to $1.5 billion. This increase is reasonable compared to 
the current core and emergency funding of $1.4 billion.
    The NFFN is a membership organization comprised of over 200 dues 
paying representatives of private fuel and energy assistance funds, 
community action agencies, social service organizations, utility 
companies, trade associations and private citizens. Our member 
organizations are located in 44 states and the District of Columbia. 
The NFFN is concerned with the ongoing energy crisis being experienced 
by the poor of America.
    Since our first steering committee meeting in 1984, the NFFN and 
its member organizations have put into action a commitment to help, the 
poor of America meet their basic energy needs.
    Our member fuel funds are organizations that raise private 
contributions in local communities in an effort to pay home energy 
bills. Fuel funds range from small church groups that distribute 
hundreds of dollars in a single neighborhood to large independent 
organizations that distribute millions of dollars across a state. Fuel 
funds may be a division of a large social service agency, or a local 
utility or energy company may operate them.
    The value of LIHEAP in meeting basic human need is well documented. 
Without LIHEAP funding during periods of prolonged and extreme winter 
weather, approximately 2.8 million families with children would be left 
virtually ``out in the cold.'' In 1994, of the 5.6 million households 
who received assistance from LIHEAP, fifty percent included a child 
under the age of eighteen. One in five have a disabled person. About 33 
percent of households have elderly residents. For those states with 
extremely hot weather, the number of elderly households is more than 40 
percent. The nation needs to turn the tide on these statistics and 
provide even more resources to prevent the health effects of 
hyperthermia and hypothermia that can be life threatening to our most 
vulnerable citizens.
    Several examples from our member organizations illustrate the 
continuing need for energy assistance among America's poor and working 
poor now. In Charlotte, Crisis Assistance Ministry provides emergency 
energy assistance and several other basic needs in an effort to prevent 
homelessness among the community's low-income citizens. Every day 
during the cold weather season, more than 100 people come seeking 
assistance, while others are calling in for appointments. Over half of 
them have heat-related needs. Crisis Assistance Ministry has been 
administering emergency LIHEAP funds for the county since 1982. It also 
administers the local fuel fund of Duke Power Company and Piedmont 
Natural Gas, as well as its own funds, raised from the religious 
community and individuals. Despite having all these resources in place, 
Crisis Assistance Ministry estimates that the need is increasing about 
20 percent per year. The Ministry is still not meeting all the need, 
and cannot begin to do so without the basic resource of a LIHEAP 
program with increased funding. Thanks to the President's release of 
emergency funds in the last two fiscal years, the Ministry has been 
better able to address some cooling needs, an essential thing in the 
South.
    Last year was one of the warmest years that the Midwest has 
recorded. Nevertheless, at EnergyCare in St. Louis, the number of 
families calling for energy related help, grew by about 2,500. In the 
hot July of 1997, 2,100 families called EnergyCare for assistance in 
using energy to cool their homes.
    New Jersey offers the final example. In that state in 1997, 146,000 
households lost their energy services due to past-due bills. A 
coalition of New Jersey's top energy companies and nonprofit agencies 
has created NJ SHARES, a new nonprofit, statewide fuel fund to address 
this situation. However, this effort, funded principally by a $1 
million start up grant from the New Jersey Board of Public Utilities, 
will not meet all the need. Increased LIHEAP appropriations are 
essential for even more New Jersey families to stay warm and healthy.
    Whatever their form, all fuel funds raise and distribute private 
sector monies, and they all, inevitably, discover that the resources 
they manage and the resources provided by LIHEAP, are inadequate. 
Consequently, fuel funds become involved in attempting to increase the 
resources available to help the poor meet their energy needs.
    NFFN has identified nearly 300 fuel and energy assistance funds 
which have developed since the late 1970's to raise private energy 
assistance dollars at the local level to provide a safety net for 
households who have exhausted all avenues of public energy assistance. 
The families served by fuel funds rank among the ``poorest of the 
poor'' in America; the majority of them have annual household incomes 
of less than $10,000. Nationally, fuel funds make heating and cooling 
bill assistance payments of over $72 million each year on behalf of 
over 500,000 families. That totals $14.40 per family, and a little over 
$5 per person. These payments, while vitally needed, are quite small in 
comparison to the $1.1 billion in fiscal year 1999 LIHEAP funding.
    As a result of the decline in LIHEAP funding over the years, other 
sources of payment assistance, such as private fuel and energy 
assistance funds, have taken on increased importance. When state 
programs close before winter's end because of inadequate federal 
funding, many needy families must look to other sources of energy 
assistance. On February 4, 1998, Caroline Myers, Chair of the NFFN 
Board of Directors and Executive Director of Crisis Assistance Ministry 
in Charlotte, described typical needy clients of her energy assistance 
program to the House of Representatives Subcommittee with jurisdiction 
over LIHEAP: ``The primary common denominator that I can define is that 
they are poor. Here is a profile of that poverty in Charlotte:
  --In our program, 70 percent of clients are below the federal poverty 
        guidelines, at least in the thirty days before coming to Crisis 
        Assistance Ministry. On average, they pay as much as 20 to 25 
        percent of their already inadequate income to heat and light 
        their homes, almost as much as the federal recommendation for 
        all shelter costs. For low-income families, less discretionary 
        money means less food or less medicine. Their dilemma is, 
        regrettably, which necessities to do without.
  --Almost 70 percent of the people that we help have earned income, 
        but it is so inadequate that there is no reserve and also no 
        benefits to provide pay while single parents tend sick 
        children, etc.
  --Often applicants are temporarily unemployed. The loss of a job, 
        even a low wage job, throws a family already struggling to make 
        ends meet into immediate crisis. Savings, if any, pay the rent; 
        and nothing is left for utility bills. The efforts of our 
        clients are often heroic, with many working more than one job, 
        as they struggle to keep a roof over their heads and their 
        children warm.
  --Other recipients are disabled and struggling to pay monthly 
        expenses. In some winters, gas and fuel prices increase as much 
        as 30 percent. Then, these families are simply unable to keep 
        up with utility bills and must seek fuel fund help. From 1980 
        to 1992, for example, the national average increase in energy 
        prices was 65.41 percent. In North Carolina, energy prices 
        increased 97 percent.''
    From NFFN's experience, this profile of needy families reflects the 
situation in other communities, and--as shown above--families' needs 
for energy assistance is growing. In the face of this growing need, two 
things have been happening over the past few years. First, fuel funds 
have not been able to fill the gap between the need for assistance and 
available federal funds. Indeed, many fuel funds, themselves, are under 
greater pressure and struggling to maintain current funding and levels 
of service. Second, as LIHEAP payments became smaller, the states have 
had difficulty in providing a meaningful level of aid to the many 
citizens who qualified. Clearly, more federal funds are needed.
    Several other factors support the case for increased LIHEAP 
appropriations. For example, in areas without local fuel funds, people 
continue to heat with unsafe methods. Some must do without heat for 
extended periods of time--something most of us do only when the power 
lines are down. The receipt of assistance to pay utility bills can mean 
the difference between someone remaining safe and warm in her or his 
home, or suffering deadly consequences. According to a LIHEAP report, 
when asked what they did for heat when they had a heat interruption, 54 
percent of the households who had experienced a heat interruption said 
that they were not able to heat their homes. Thirty-nine percent 
reported that they heated one or two rooms with another heat source 
such as a fireplace or a cooking stove to keep warm--clearly a fire 
hazard.
    There have been a number of tragic events from using dangerous 
alternatives. House fires disproportionately take the lives of children 
and the elderly. In 1991, inappropriate heating was the third cause of 
civilian fire deaths. Recognizing the relationship between loss of 
utility service and the risk of injury and death from fires, the NFFN 
has formed a relationship with fire marshals in Philadelphia, 
Washington DC, Detroit and other communities, to educate families about 
the risk of fire and to put in place prevention measures.
    Another factor is that the need for energy assistance is just as 
important in the South as it is in the North. Nationwide, median income 
families spend an average of 3.8 percent of their monthly as in the 
household income on energy. In North Carolina, the average is 4.4 
percent. Low-income households across the country spent and average of 
12.1 percent of their monthly income on energy, compared to North 
Carolina's low-income population's spending 14 percent
    NFFN suggests that when we talk about ``the poor'', we are 
generalizing. Families and individuals move in and out of that category 
due to the circumstances of their lives. A death in the family, 
divorce, a plant closing, loss of a job, extended illness or any number 
of situations can create a crisis. These are the people that fuel funds 
and emergency assistance programs seek to help.
    A third factor concerns our children. The receipt of assistance to 
pay utility bills can make a significant difference in the quality of 
life for low-income children. In recent years, increasing national 
attention has been focused on education, yet low-income children are 
still less likely to receive a good education. A study entitled ``A 
Road Often Taken: Unaffordable Home Energy Bills, Forced Mobility and 
Childhood Education in Missouri'' explored the interconnection between 
two seemingly unrelated problems in rural Missouri households: 
unaffordable home energy bills and poor educational attainment. 
Findings conclude that a substantial portion of the low-income 
population is ``frequently mobile'' over a five year period; that one 
primary cause of this frequent mobility is the unaffordability of home 
energy bills, including home heating and electricity; and that the 
frequent mobility creates problems for both the students in these 
mobile households and for the teachers and schools who seek to educate 
those transient students.
    Another study done in Philadelphia reports that a utility shut-off 
notice is the clearest indicator of potential homelessness. When 
families are unable to maintain essential services, they may be forced 
to move. The result is abandoned properties, and the economic decline 
of neighborhoods. Intervention, in the form of energy assistance, helps 
stabilize those families.
    Reductions in LIHEAP--thankfully reversed by Congress last year--
brought more and more families to the doors of fuel funds around the 
country. As skilled as we are in raising charitable contributions from 
private donors, we are not able to compensate for the loss of federal 
support. Most fuel funds do not distribute LIHEAP funds. Most are last 
resort programs that require that applicants have sought all other 
resources, including LIHEAP, before receiving help. When that 
assistance is inadequate or insufficient, they turn to private 
resources.
    The impact of welfare reform on energy assistance is just beginning 
to be felt. People who are leaving public assistance enter low paying 
jobs and will still be confronted with energy bills that they cannot 
pay. These families are at risk and must have support systems like 
LIHEAP and emergency assistance if welfare reform is to meet its goals. 
LIHEAP appears play an increasing role in the welfare reform 
transition. Former public assistance recipients, for the most part, 
make only slightly more than minimum wage, nowhere near the living wage 
that a family needs. In Charlotte, for example, a living wage has been 
calculated at almost $13 per hour.
    Some may suggest that private fuel funds and other charitable 
contributions will make up the deficit resulting from further cuts in 
LIHEAP funding. Others will point to fuel funds as an example of the 
kinds of help that could potentially take the place of LIHEAP. Fuel 
funds raise only about 5 percent of what is available through LIHEAP As 
thankful as we are for the continued generous response from private 
donors across the country, we are painfully aware that our efforts 
still fall far short of the need. Privately raised energy assistance 
dollars can only supplement LIHEAP dollars to a small degree, and can 
never take the place of Federal energy assistance funds. In addition, 
in an era of deregulation and restructuring of the electric utility 
industry, can we realistically expect utility companies to step up the 
pace in growing their fuel funds?
    While we who daily serve the energy needs of low-income families 
understand the difficult task of setting national priorities that is 
before Congress, we respectfully, but urgently request you, as you 
consider funding for fiscal year 1999, to keep in mind the important 
role that LIHEAP plays as a safety net for millions of our Nation's 
most vulnerable citizens. It is a broad based, effective and efficient 
program. The need is very real. We trust that your deliberations will 
significantly assist those who struggle daily to protect themselves and 
their families from extremes of weather.
    Thank you for your consideration of this testimony.
                                 ______
                                 
  Prepared Statement of Dr. Harry S. Jacob, on Behalf of The American 
                         Society of Hematology
    Senator Specter and members of the Subcommittee, thank you for the 
opportunity to testify on behalf of the American Society of Hematology 
(ASH). My name is Dr. Harry Jacob and I am President-Elect of ASH. I 
have been a recipient of grant funds from the National Institutes of 
Health for many years. The Society has over 8,000 physicians and 
research scientists who are united by our interest in the workings of 
the blood and blood-forming organs and by a commitment to understanding 
and curing blood disorders. On behalf of the Society and the biomedical 
research community as a whole, we wish to thank the Subcommittee for 
their strong and unwavering support of the National Institutes of 
Health and of biomedical research. Along with many others in the 
biomedical research community, we support the development of a long-
range plan for funding biomedical research as well as the largest 
possible increase in the next fiscal year to allow scientists in this 
country maximal opportunity to make new discoveries. In this regard, we 
are quite pleased to learn that the Administration's fiscal year 1999 
budget proposes a significant increase in NIH funding.
    I would like to use this opportunity to explain how NIH-sponsored 
basic research in the field of hematology has led to important 
discoveries and generated new treatments and pharmaceutical products of 
broad general interest. I would also like to focus on the synergy and 
cross-fertilization that is intrinsic to scientific work and show you 
how basic hematologic research has aided scientists and physicians who 
treat patients with illnesses as varied as heart disease, strokes, 
venous thrombosis, end stage renal disease, cancer, and AIDS.
Arterial thromboembolism
    The leading cause of death in this country is cardiovascular 
disease, primarily heart attacks and strokes. In the next year, over 
600,000 Americans will have their first heart attack and nearly half of 
them will die before reaching the hospital. Hematologists have made 
several important discoveries that promise to reduce the incidence and 
the number of deaths from heart attacks and strokes. They helped 
document that coronary occlusion by platelets and coagulation proteins 
is the cause of virtually all heart attacks and demonstrated that 
aspirin, an inhibitor of platelet function, could be used to prevent 
heart attacks. Basic work by hematologists led to the development of 
therapeutic agents to dissolve blood clots that had formed in coronary 
arteries and to the development of potent agents which completely block 
platelet aggregation. The clot dissolving or fibrinolytic agents and 
this new generation of antiplatelet drugs, both marketed by American 
biotechnology companies, are saving the lives of patients who suffer 
heart attacks and strokes. In addition to helping patients, these 
discoveries have created important new business opportunities along 
with thousands of jobs and will generate at least a billion dollars of 
revenue in the next year.
Hematopoietic hormones
    Basic research on the growth and development of the bone marrow has 
led to the discovery of several important regulatory hormones which 
have revolutionized the treatment of patients with cancer and renal 
disease. NIH-sponsored research enabled American biotechnology 
companies to develop and market erythropoietin, the hormone which 
regulates red blood cell production. It is being used to treat patients 
with renal failure who become severely anemic. This treatment, along 
with dialysis, has improved the well being and life span of kidney 
failure patients and eliminated the need for blood transfusions. 
Granulocyte colony-stimulating factor or G-CSF, another product of NIH 
sponsored research, was developed and marketed by an American 
biotechnology corporation. It is being given to cancer patients 
undergoing chemotherapy. It raises their white blood cell count and 
protects them from infection. A similar hormone, called thrombopoietin, 
which regulates platelet production, is undergoing clinical trials and 
may be used in a similar way to prevent bleeding due a low platelet 
count. These remarkable new drugs have been developed because the 
biotechnology industry has been able to rapidly translate the 
observations of NIH-sponsored scientists and produce useful products. 
The reduced need for blood transfusions in patients with kidney failure 
and the reduced incidence of infections in cancer patients will lower 
medical costs and improve the quality of life for thousands of patients 
each year.
Venous thrombosis and embolism
    Venous thrombosis is a disorder in which blood clots form in the 
legs and pelvic veins. The most feared and sometimes lethal 
complication is pulmonary embolism, a condition in which the clots 
travel and block the circulation through the lungs. This condition can 
affect several hundred thousand people in this country each year. Until 
recently, there was little information available on the underlying 
cause of this disorder. Work by hematologists studying blood 
coagulation has identified a common mutation in one of the blood 
clotting proteins, which is present in 2 percent of the general 
population and may account for 25-30 percent of the cases of venous 
thrombosis. The identification of this mutation will allow screening to 
determine which individuals are at risk to develop venous thrombosis 
and allow early treatment. This should be particularly beneficial to 
women who can be warned to avoid drugs like the oral contraceptives or 
high doses of estrogens that may cause them to develop venous 
thrombosis. This information could improve the treatment of older 
Americans who have the highest incidence of venous thrombosis. 
Susceptible individuals may develop blood clotting after undergoing 
surgery, sustaining a fracture, or being confined to bed or a 
wheelchair. In addition to improving the quality of life and preventing 
additional complications like pulmonary embolism, the prevention of 
venous thrombosis could result in substantial savings by avoiding a 
large number of unnecessary hospitalizations.
New anticoagulants
    I would also like to mention a new anticoagulant that may 
revolutionize our treatment of patients who develop venous thrombosis. 
Heparin has been used for over 50 years to treat patients with venous 
blood clots. It is an impure substance derived from the tissues of beef 
cattle and pigs and is a byproduct of the meat industry. At present, 
heparin is given intravenously and requires daily laboratory testing to 
adjust its dose. Despite careful laboratory monitoring, heparin still 
causes serious bleeding and lowers the platelet count in many 
recipients. Hematologists studying its mechanism of action were able to 
isolate and characterize the active fraction of commercial heparin. 
Several pharmaceutical companies developed techniques to purify large 
quantities of this heparin fraction and have completed clinical trials 
showing that it is a superior anticoagulant. Patients who receive these 
new heparins have a lower incidence of bleeding and do not require 
daily laboratory testing. This means that many patients with blood 
clots who required hospitalization for heparin therapy can now be 
treated as outpatients. The savings to the health care industry will 
run into the billions of dollars as this new drug replaces conventional 
heparin therapy.
Therapy for AIDS
    Over two decades ago, hematologists interested in understanding the 
immune system began to characterize the cell surface proteins of 
lymphocytes. They carried out much of this work on cells derived from 
patients with various types of lymphoma. This work led to the 
classification of two major classes of lymphocytes: those that contain 
a protein called CD4 that help to produce antibodies and another that 
contains the protein CD8 which kills tumors. Years later, scientists 
studying AIDS were able to build on these fundamental observations. 
First, they showed that the number of CD4-containing cells decreased 
following infection with the virus causing AIDS and that this could be 
used as a way to follow the effects of the virus. Second, they were 
able to show that the CD4 protein was one of the receptors that the 
virus used to gain entry into lymphocytes. Within the past year, AIDS 
researchers were able to show that another class of receptors 
discovered by hematologists studying inflammation, called chemokine 
receptors, were also needed for the AIDS virus to infect cells. These 
studies demonstrate nicely how basic research in one area can provide 
information of great benefit to scientists working in other fields.
Treatment of sickle cell anemia
    Another example of this important interrelationship can be seen in 
research on sickle cell disease. This is an important and debilitating 
disease which afflicts 1 percent of African Americans and causes 
recurrent painful crises, frequent hospitalizations, and serious damage 
to the brain, kidneys and lungs. Until very recently, there were no 
effective treatments for this disorder. Scientists studying drugs of 
use in treating cancer made the interesting observation that some 
agents which interfered with DNA synthesis in cells could stimulate the 
cells to make a form of hemoglobin which prevented sickle hemoglobin 
from precipitating with red blood cells. One of these agents, called 
hydroxyurea, had minimal toxicity and was shown to have a similar 
effect when given to patients with sickle cell anemia. An NIH-sponsored 
multi-institutional clinical trial confirmed hydroxyurea could reduce 
the incidence of painful crises in sickle cell patients and has 
provided the first effective treatment for this disorder. Patients who 
were frequent visitors to emergency rooms and often required 
hospitalization now have long periods of time free of pain.
Conclusion
    I have tried to summarize a number of important discoveries by 
basic researchers in the area of hematology that have led to new 
methods of treating patients with many common diseases. As 
hematologists, we are quite proud that hematologic research has 
resulted in so many useful new drugs that have helped to spawn the 
American biotechnology industry. There are numerous other examples that 
could also be discussed. Hematologists were one of the first groups to 
study the amyloid proteins which are pivotal in the development of 
Alzheimer's disease. An American hematologist, E. Donnall Thomas, 
received the Nobel Prize for the development and implementation of bone 
marrow transplantation. This important technique has revolutionized our 
treatment of many disorders including various forms of leukemia, 
immunodeficiency states, bone marrow failure, and a number of genetic 
disorders that affect the brain and other organs. Hematologists are now 
working on methods to use bone marrow stem cells for gene therapy and 
expanding transplantation to treat a wide variety of malignant 
disorders. We remain confident that basic and applied biomedical 
research, when coupled with a vigorous pharmaceutical and biotechnology 
industry, will lead to better and more cost effective ways to treat 
medical disorders.
    While much has been accomplished, there is clearly much more to be 
done. We thank the members of the Subcommittee for your past support of 
the work that has led to the discoveries just discussed and hope that 
you will find a way to increase funding for biomedical research. In 
this regard, the American Society of Hematology endorses the Ad Hoc 
Group for Medical Research Funding's recommendation of a 15 percent 
increase in NIH funding for fiscal year 1999.
                                 ______
                                 
  Prepared Statement of Dr. David R. Bickers, Secretary-Treasurer, on 
          Behalf of the Society for Investigative Dermatology
    Mr. Chairman and subcommittee members: I am very grateful for this 
opportunity to testify today on behalf of the Society for Investigative 
Dermatology. I am Dr. David Bickers, Secretary-Treasurer of the Society 
for Investigative Dermatology and Chairman of the Department of 
Dermatology at Columbia/Presbyterian Medical Center in New York City.
    The Society for Investigative Dermatology has as its mission the 
support of research in skin disease. Our 2,000 members include 
scientists and physician researchers from universities, hospitals, and 
industry committed to the science of dermatology. Each of our members 
firmly believes that research is critical to improved prevention, 
diagnosis, and treatment for the 60 million Americans afflicted with 
skin disease. My purpose in being here today is to personally emphasize 
the need for increased funding of the programs of the National 
Institute of Arthritis and Musculoskeletal and Skin Diseases (NIAMS).
    We support the proposal of the Ad Hoc Group for Medical Research 
Funding, which calls for a 15 percent increase in funding for the NIH 
in fiscal year 1999 as the first step toward doubling the NIH budget 
over five years. We recognize the difficulty in achieving this goal 
under the current spending limits, and encourage the Congress to 
explore all possible options to identify the additional resources 
needed to support this increase. We support an increase of 15 percent 
specifically for NIAMS as well.
    It is my understanding that all other members of the NIAMS 
Coalition will be seeking a similar amount.
    My testimony is drawn from the booklet, Skin Disease Research: 
Successes, Opportunities, Support (you have a copy before you). If any 
of the members of the Subcommittee would like to receive extra copies 
for your staff or for persons in your district, please indicate that to 
me and I will see that you receive them in the mail quickly.
Background
    Good health depends on healthy skin. Much of what we see on the 
outside of the body is a reflection of a person's health inside. From 
the yellow of hepatitis, to the purple lesions of Kaposi's sarcoma--a 
sometime feature of AIDS, from the skin lesions of lupus erythematosus, 
to the painful deformed nails which may occur in patients with 
arthritis and psoriasis, internal health disorders often show up first 
as problems on the skin's surface. Skin conditions have profound 
effects on our ability to interact with other people. Common skin 
conditions such as acne compromise our self-confidence. Loss of hair 
sometimes says ``I am old.'' Studies in the United Kingdom reveal a 
higher rate of unemployment among acne patients than among unaffected 
people of comparable ages and abilities. Ancient prejudices and 
ignorance often lead people to shun those they deem unhealthy on the 
basis of appearances.
    The ongoing revolution in molecular and cell biology, genetics, 
immunology, information processing and laser technology provides 
unprecedented opportunities for achieving advances in basic research 
and medical treatment. The accessibility of the skin makes it an ideal 
organ to study, both at the basic cellular level and as a tissue. It 
permits us to assess the effects of new therapies both for skin 
diseases and, in some instances, internal diseases. Skin samples are 
often used to make genetic diagnosis of internal disorders and in the 
future the skin may be a very convenient target for gene replacement.
    Advances in cell biology allow us to understand the life cycle of 
skin and hair-producing cells and to explain how a malfunctioning 
immune system undermines the health of the body in general and the 
skin, in particular. We are also becoming more adept at growing skin 
cells in the laboratory and at producing artificial skin. Increasingly, 
laser surgery is replacing more invasive and traumatic traditional 
surgical methods.
    These and other advantages are towering monuments to the tenacity 
and creativity of our scientists and hold out tremendous promise for 
improvements in health care. But as spectacular as these achievements 
are, we are far from realizing their full potential. We must still do 
more to understand and treat the problems at hand rationally and 
effectively to prepare for the challenges of the next century.
    As the population ages and we live longer, dermatologists will be 
asked increasingly to treat cancers and other skin disorders that 
appear more often in older individuals. Dermatologists will need to 
find new and better ways to help prevent and heal common conditions of 
the elderly such as bed sores. Ulcers of the skin cost $8 billion per 
year. Much remains to be done--to improve diagnosis and treatment, both 
for current and future problems--and clearly more research is needed 
across the entire spectrum of the more than 3,000 dermatological 
diseases.
    Research discoveries have already reduced the costs of treating and 
curing some diseases. Expanding our research program will allow us to 
build on recent findings, to learn more about the mechanisms of 
diseases that are still poorly understood and to improve the economic 
and physical health of the nation.
    There are more than 3,000 different diseases of the skin, hair and 
nails, which in an average year affect about 60 million Americans. The 
combined annual cost to society of medical care and lost wages from 
these conditions is estimated to be $7 billion. The potential cost to 
individuals suffering from these conditions includes: discomfort and 
pain, disfigurement, disability, dependency, and death.
    Research Advances
    The past two decades have witnessed an explosive growth in 
technology and an increased sophistication in our understanding of the 
genetic and cellular mechanisms underlying many of these disorders. One 
consequence of these findings is a radical new paradigm shift in which 
the skin is now viewed as a complex organ that is intimately responsive 
to the body's immune system. Several distinct cell types in the skin 
actively generate, regulate and perpetuate immune responses. Other 
important new research findings include the following:
  --A gene responsible for the inherited form of basal cell carcinoma 
        has been identified. This may lead to important new information 
        about the origins of skin cancer.
  --A gene for an inherited form of hair loss has been discovered.
  --A new protein has been discovered that links collagen and vascular 
        defects in scleroderma.
  --Advances in the design of drug-delivery systems allow for sustained 
        release of drugs through the skin, probably leading to more 
        effective treatments using this pathway.
  --Methods to grow real and artificial skin in the laboratory are 
        currently used to prepare skin grafts for burns and wounds.
    Paralleling these technological advances of the past two decades, 
there has been a comprehensive focus on evaluation. Technologics beyond 
the laboratory such as clinical epidemiology, biostatistics, economics, 
and the quantitative social sciences are being used to determine the 
effectiveness of certain procedures and whether they contribute to the 
quality of life and health of both patients and society. The public 
deserves value in return for research support and health care 
expenditures, and it is incumbent upon the research community to 
address such important issues.
    As you know, medical research organizations such as the Society for 
Investigative Dermatology work closely with patient support and 
advocacy groups. We are pleased to say that for many years we have 
worked with the Coalition of Patient Advocates for Skin Disease 
Research. The many organizations that participate in the Coalition have 
been the best possible advocates for increased funding, as they 
understand that unless major research efforts are undertaken, advances 
in understanding and improvements in the health of patients will not 
occur. Every year, we participate with these organizations in 
advocating increased funding. Recently, working together, we have 
created a comprehensive analysis and a research plan for further 
progress, detailed in the document before you. May we suggest that bill 
report language be inserted in the bill report noting this document and 
its use, and urging the support of NIAMS in its publicizing? We suggest 
language such as the following:
    The Committee has learned of the efforts by the skin diseases 
researchers and patient advocate organizations to develop a 
comprehensive analysis of research opportunities and a research plan 
for further progress in finding cures and improving care for patients 
with these diseases. The Committee applauds this initiative and 
requests NIAMS to publicize and support widespread use of this 
material.
    Thank you, Mr. Chairman and subcommittee Members, for this 
opportunity to discuss with you the science of dermatology.
    I will be pleased to answer any questions you may have.
                                 ______
                                 
  Prepared Statement of Steven R. Berg, Director of Program, National 
                   Alliance to End Homelessness, Inc.
The fight against homelessness in 1998
    The national fight against homelessness is at a critical juncture. 
Despite low unemployment, all indicators are that the number of 
homeless people continues to rise. A recent study by Second Harvest, a 
nationwide nonprofit that provides food for shelters, soup kitchens and 
food pantries, showed that approximately 3.4 million people were 
homeless at some point in 1997, up from 1.3 million in 1988. The latest 
29-city survey by the U.S. Conference of Mayors, A Status Report on 
Hunger and Homelessness in America's Cities: 1997, reported continued 
increases in requests for emergency shelter. Only two of the 29 cities 
reported that all need was being met; all but three of those reporting 
indicated that homeless families with children were turned away from 
shelter.
    While this continued increase in homelessness may come as a 
surprise given the low rates of unemployment prevalent in much of the 
country, it should not. Many homeless people either can not work due to 
disabilities, or face barriers that make them likely to have the lowest 
paying jobs. The trends that brought about the sharp increase in 
homelessness since the early 1980s continue unabated:
  --Wages for the lowest-paid workers have continued to fall in real 
        terms.
  --Public assistance has become less available. State after state has 
        eliminated ``general relief'' programs for childless adults. 
        Many people with disabilities related to substance abuse have 
        been dropped from the SSI program, some as a result of 
        conscious policy changes, others who should remain eligible but 
        have been unable to negotiate the process for documenting their 
        continued disability. States' TANF programs have terminated 
        benefits to many families, and studies by the GAO and the 
        states of New York and Maryland indicate half or more of those 
        leaving welfare are not working steadily.
  --States have continued to reduce the number of inpatient beds for 
        people with mental disabilities.
    Combined with these long-term trends, new factors have pushed the 
number of homeless people up. For the past three years there has been a 
net decline in the number of federally subsidized housing units 
available at affordable rents for low-income people. At the same time, 
the good economy has brought about skyrocketing rents in many 
locations, making it all the more difficult for people living on low-
wage work or disability benefits to remain housed.
    Even while this grim situation persists, certain opportunities make 
it possible, with effective leadership from the federal government, to 
make serious inroads against the problem of homelessness. The good 
economy means that jobs are plentiful. One outcome of welfare reform is 
a new commitment on the part of human service providers, government and 
business to do the work necessary to make those jobs feasible for low- 
income Americans.
    Perhaps more important, a result of ten years of experience 
implementing programs under the Stewart B. McKinney Homeless Assistance 
Act is a growing body of know-how. It is largely with the membership of 
the National Alliance to End Homelessness that this know-how resides. 
The Alliance has approximately 2,000 members, in every state, nonprofit 
organizations, government agencies and private businesses that are 
actively engaged in moving people out of homelessness. They are the 
best source of information about how federal programs work, and what is 
needed to make the fight against homelessness more effective.
    Our members' experience with fighting against homelessness 
indicates the primary importance of a coordinated network of services 
and opportunities, working at the local level to ensure that there is 
affordable housing, adequate income through employment or government 
benefits for those who are unable to work, and human services for those 
who need them. This is not solely a task of the federal government, or 
indeed of government at all, but requires active participation by 
private business (providing jobs and knowledge about what kinds of 
workers are needed) and nonprofit agencies (providing commitment to 
serving individuals, plus the entrepreneurial energy to put programs 
together), as well as government (providing funding, coordination of 
programs, expertise, and networking on a local, state and national 
level).
    Federal programs funded by the departments of Labor, Health and 
Human Services, and Education provide important pieces to the puzzle 
that homeless service providers must put together at the local level. 
These efforts will become even more important in the near future, due 
to initiatives of the Congressional committees that oversee the 
Department of Housing and Urban Development. HUD, of course, runs the 
largest of the federal government's homeless-specific programs, the 
Homeless Assistance Grants Programs. In the past, local recipients of 
Homeless Assistance Grants have used that money not only to provide 
shelter and housing, but also to provide human services. In fact, in 
the most recent year for which analysis is available, more than half of 
the money from the HUD Homeless Assistance Grants went to pay for non-
housing services. Recent Congressional initiatives, however, have 
sought to focus the HUD resources more on permanent housing, where HUD 
has a formidable expertise. This creates a challenge to other federal 
agencies, to use their expertise to fill in service gaps.
Homeless-specific programs
    The departments under this subcommittee's jurisdiction already have 
important programs targeted specifically to homeless people. The 
Department of Education's Education for Homeless Children and Youth 
program provides money to states to ensure that homeless children are 
able to have access to school. Health Care for the Homeless, part of 
HHS's Consolidated Health Centers, funds clinics to do outreach and 
provide medical care to homeless people. The Runaway and Homeless Youth 
program, also within HHS, pays for outreach, transitional housing and 
other services to this particularly vulnerable segment of the homeless 
population. HHS domestic violence programs address one of the major 
contributing factors to homelessness among women. The Homeless 
Veterans' Reintegration Project, run by the Department of Labor, funds 
local agencies to move homeless veterans into the job market through a 
range of services. Each of these provides funding and a centralized 
locus of expertise to deal with a particularly difficult aspect of the 
problem of homelessness. For each of these programs, the National 
Alliance to End Homelessness supports a level of funding that will 
adequately address critical need.
The PATH Program
    Perhaps the most difficult aspect of homelessness is the subject of 
the PATH program (Projects for Assistance in Transition from 
Homelessness), administered by the Substance Abuse and Mental Health 
Services Administration within HHS. PATH provides formula grants to 
each state for community-based outreach, case management and treatment 
for homeless people with severe mental illnesses, including those with 
a dual diagnosis of mental illness and drug or alcohol addiction. PATH 
grantees often search out homeless people in streets and abandoned 
buildings, and respond to calls from concerned business owners and 
others about homeless people with obvious mental illnesses who have no 
connection to local networks of services.
    In fiscal year 1996, when PATH funding was cut to $20 million, its 
grantees served 76,000 people, approximately $263 per person per year. 
This is in sharp contrast to the cost of involuntary hospitalization in 
a psychiatric facility, often hundreds of dollars per day.
    Although PATH is extremely effective, its resources are 
overextended. Those with mental illnesses constitute up to one-third of 
homeless adults. By all accounts, this group is expanding. Homeless 
service providers often identify specialized mental health outreach and 
treatment as a service that is in too-short supply. PATH's fiscal year 
1998 appropriation is $23 million, still well below its $33.1 million 
appropriation for fiscal year 1991. Even at its high point in 1994, 
PATH served 127,000 people. The most recent available count of homeless 
people with disabilities, from 1987, showed that even that long ago 
there were at least 180,000 adults with severe mental illnesses who 
were homeless. The actual number by now is almost certainly much 
higher.
    Because homeless people with severe mental disabilities are so 
difficult to move into permanent housing, and because the PATH program 
has worked so well, the National Alliance to End Homelessness believes 
that a major increase in PATH funding is necessary in order to 
complement HUD and other homeless programs and ensure that the drive to 
move homeless people into permanent housing includes those with mental 
illnesses. The Alliance recommends an appropriation of $34 million for 
fiscal year 1999.
Other programs
    A number of programs, not specifically targeted toward homeless 
people, provide funds for the kinds of services most needed by homeless 
people. These ``mainstream'' programs have not had a sufficient impact 
on the problems of homeless people. Job Training Partnership Act 
programs are an example. For several years, the Department of Labor ran 
a Job Training for the Homeless Demonstration Project. The results of 
this demonstration showed that, for employment-related activities to 
work for homeless people, they must be at least coordinated with 
housing services, so that residence is stabilized before homeless 
people attempt to take advantage of job-related programs. With the 
demonstration over, there needs to be a concerted attempt to encourage 
JTPA grantees to coordinate their services with local homeless 
providers, so that homeless people can gain from JTPA-funded 
activities.
    The Substance Abuse and Treatment Performance Partnership Block 
Grant, administered by the Substance Abuse and Mental Health Services 
Administration, funds services that are desperately needed by up to 
half of homeless adults. The Administration has proposed an increase of 
$200 million in this block grant. Demonstration projects from the late 
1980s show that substance abuse treatment for homeless people can be 
effective if coordinated with other services. Nevertheless, there is 
little indication that homeless people are benefiting from programs 
funded by the Substance Abuse Block Grant.
    The National Alliance to End Homelessness urges the subcommittee to 
take measures to focus HHS and the Department of Labor on making their 
``mainstream'' programs address the needs of homeless people.
Conclusion
    The National Alliance to End Homelessness, for its members, thanks 
the Subcommittee for its attention to these issues. There is no reason 
that we need to tolerate homelessness. The know-how exists to solve the 
problem. All sectors of society are engaged. The federal government has 
programs that allow it to do its part, exercising leadership and 
filling gaps in services, efficiently and effectively. These programs 
need only to be brought to a more realistic scale, through strong 
funding for homeless-specific programs, and attention to the needs of 
homeless people when administering ``mainstream'' block grants.
                                 ______
                                 
 Prepared Statement of Robert M. Tobias, National President, National 
                        Treasury Employees Union
    Chairman Porter, Members of the Subcommittee: My name is Robert M. 
Tobias, and I am the National President of the National Treasury 
Employees Union (NTEU). NTEU is the exclusive representative of more 
than 160,000 federal employees across the government. Thank you very 
much for the opportunity to come before your Subcommittee today.
    NTEU appears today on behalf of the employees we represent in the 
various divisions of the Department of Health and Human Services (HHS) 
and the Social Security Administration (SSA). This includes employees 
in the Office of the Secretary, Office for Civil Rights, Administration 
on Aging, Administration for Children and Families, Agency for Health 
Care Policy and Research and the Health Resources and Services 
Administration. In addition, NTEU represents employees within SSA's 
Office of Hearings and Appeals.
    While we are unable to comment on specific proposals included in 
the President's fiscal year 1999 budget for the Department of Health 
and Human Services, the message I want to deliver today is this. 
Federal employees represented by this Union--not just in HHS and SSA--
but government-wide, are working smarter and accomplishing more even 
while the resources available to them have continued to decline. There 
is an essential need for stable and steady funding levels, for improved 
and expanded training programs and for continuity in direction if our 
public servants are to continue delivering top quality service to the 
American taxpayer.
    The federal government has undergone unprecedented downsizing. Over 
300,000 federal jobs have been eliminated since President Clinton took 
office. As the President pronounced in his State of the Union Address 
just one week ago, ``We have the smallest government in 35 years * * * 
a government that is leaner, more flexible, a catalyst for new ideas * 
* *''
    And I hope the President was right that we have ``moved past the 
sterile debate between those who say government is the enemy and those 
who say government is the answer''. The federal employees represented 
by this Union who continue to serve the public are competent, 
hardworking and motivated individuals who want to deliver a high 
quality product to the American taxpayer.
    The political reality is that the federal government is likely to 
continue to shrink. Many, if not most agencies have imposed 
restrictions on hiring, promotions and reassignments. Morale, in the 
wake of government bashing, budget cuts, reductions in force, efforts 
to contract out federal jobs, federal government shutdowns and the 
Oklahoma City bombing is at an all time low. We must recognize that 
only when we value the work our public servants perform can we expect 
the best and the brightest to continue to seek out careers in public 
service. The federal government operates as a business and like any 
successful business, it must recognize that its most important resource 
is its dedicated and committed workforce.
    The uncertainty surrounding both the amount of annual 
appropriations agencies can expect and the date each year when new 
spending might be enacted into law has taken its toll. When annual 
funding hangs in the balance and rumors circulate that agency salary 
and expense accounts may be slashed, even the best employees become 
consumed by threats of losing their jobs. For several years now, 
employees across government have lived under a cloud of potential 
reductions in force. As you may know, Mr. Chairman, one important tool 
federal agencies have had has been the ability to offer buy-outs to 
employees whose jobs are being eliminated. That authority expired 
December 31, 1998. If further staffing reductions are envisioned at 
agencies funded under this appropriations measure, I urge this 
Subcommittee to carefully consider the need for new buyout authority 
for these agencies.
    It is our hope, however, that agencies will be fully funded to 
enable them to continue the important work they perform. As the 
Chairman knows, the many programs administered by HHS and SSA have a 
wide impact on our Nation's citizens.
    In fiscal year 1998, HHS's Administration for Children and Families 
(ACF) received $140.7 million for program direction. This represented a 
reduction of $2.3 million from the fiscal year 1997 appropriation for 
ACF. The ACF oversees an array of important federal initiatives 
including the successful Head Start program, child abuse prevention and 
treatment programs and a host of other critical child, youth and family 
programs. Cuts in this agency's funding have hampered employees' 
abilities to fulfill the agency's mission and I urge this Subcommittee 
to be mindful of these concerns as it debates fiscal year 1999 spending 
decisions.
    Program support funding for the Agency for Health Care Policy and 
Research (AHCPR) was set at $2.2 million in both fiscal year 1997 and 
1998. Clearly, this agency will require increased funding just to 
continue its important work.
    Similarly, the Office of the Secretary should be carefully reviewed 
for its departmental management funding. In fiscal year 1998 the Office 
received $177.4 million--a decrease from its fiscal year 1997 funding 
level.
    For the Administration on Aging (AOA), program administration 
funding increased by $37,000 from fiscal year 1997 to the 1998 level of 
$14.7 million. This modest increase enacted by Congress recognized the 
important services AOA delivers with the funding it is provided and 
NTEU hopes AOA will continue to be fully funded.
    Program management funds for the Health Resources and Services 
Administration (HRSA) increased by $1.1 million from fiscal year 1997 
to an fiscal year 1998 level of $114 million. HRSA plays a central role 
in ensuring that quality health care is available to millions of 
Americans and I hope this Subcommittee will carefully review this 
agency's continuing needs.
    The mission of HHS's Office of Civil Rights (OCR) is to ensure that 
recipients of federal funding through HHS do not discriminate against 
program beneficiaries. OCR has an enormous responsibility, yet, 
historically, appropriation levels have not kept pace with its workload 
and staffing requirements. Funding for OCR in fiscal year 1998 was set 
at $19.6 million, a modest $169,000 increase over the funding received 
by OCR in fiscal year 1997. The work performed by this division will 
continue to be in the spotlight in the coming fiscal year and I hope 
this Subcommittee will fund that work to the greatest extent possible.
    NTEU is also critically concerned about funding for the Food and 
Drug Administration (FDA). Although the FDA is not funded under the 
Chairman's appropriation measure, I bring this need to your attention 
because FDA employees work in HHS facilities and alongside HHS 
employees. Underfunding compromises the important, as well as 
lifesaving, work of the FDA. Personnel levels must be brought to the 
point where timely approval can be given to medicines and other 
products without compromising accuracy, meticulousness or quality. The 
increase from fiscal year 1997's appropriation of $820 million to the 
$857.5 million FDA received in fiscal year 1998 was mostly to cover the 
costs of the new food safety initiative.
    In the five years since passage of the Prescription Drug User Fee 
Act (PDUFA) of 1992, FDA has greatly improved the speed with which it 
can approve drugs for marketing--down from 30 months to 15 months. At 
the same time, however, the number of new submissions has increased by 
50 percent. Staffing levels have not kept pace. Frontline employees are 
being asked to accept ever increasing workloads while striving to 
uphold FDA's policy of reducing approval times. While we applaud PDUFA 
and its recent reauthorization (PDUFA II) for creating a dependable 
revenue stream for the Agency through user fees and for its commitment 
to review times that will bring important drugs to consumers with 
greater speed, we caution any action that could sacrifice quality for 
speed.
    There are several areas of concern regarding the Social Security 
Administration (SSA) that I would like to bring to your attention. SSA 
continues to have two major problems with its disability system, 
Continuing Disability Reviews (CDR) and the backlog at the Office of 
Hearings and Appeals (OHA). NTEU believes that the current level of 
funding for the CDR program will permit significant progress to be made 
in that area. However, the OHA backlog problem continues because 
substantial funds are being expended in the Disability Process Redesign 
(DPR) apparently toward the goal of decreasing the backlog, but without 
appreciable results. NTEU believes that SSA could make a significant 
reduction of that backlog with a much smaller expenditure by suspending 
or terminating the Adjudication Officer Initiative of the DPR and 
continuing the highly successful and relatively inexpensive Senior 
Attorney Program (also known as the Short Term Disability Program 
Action No. 7).
    The massive increase in the disability backlog that OHA experienced 
from 1992 to 1996 has been contained and finally reversed. The case 
backlog has fallen from a high of approximately 570,000 in 1995 to 
518,862 in December 1996 and to 458,142 by December 1997. While no one 
at OHA is satisfied with the current level of cases pending, we have 
demonstrated that we can, and will continue to significantly reduce the 
backlog without significantly changing agency operations. This 
substantial reduction of the backlog is due in great part to the Senior 
Attorney Program (approximately 120,000 decisions since its inception), 
which in continued, will facilitate an even greater reduction in the 
case backlog and in processing times, and a reduction in the reversal 
rate thereby providing greatly improved service to the public.
Senior Attorney Program
    The Senior Attorney Program is a sharply focused plan with a well 
defined target, the disability backlog at SSA's Office of Hearings and 
Appeals, which for the most part uses existing agency assets. This 
program did not require restructuring the Agency, a massive infusion of 
expensive technology, revising the decisional methodology, extensive 
employee dislocations, comprehensive, lengthy and expensive training of 
substantial numbers of employees and nearly four years of planning 
without tangible results. In short, the Senior Attorney Program, which 
produced nearly 100,000 decisions in fiscal year 1996 and fiscal year 
1997, has been relatively inexpensive and very effective and provides 
greatly improved service to the public primarily through redirecting 
current assets.
    Senior Attorneys spend approximately 30-50 percent of their time 
performing work related to the short-term disability project and most 
of the remaining 50-70 percent of their time drafting ALJ decisions. 
The ability of Senior Attorneys to perform both tasks significantly 
increases managerial flexibility, allowing human assets to be directed 
to the highest priority tasks, thereby maximizing OHA productivity. 
Agency statistics reveal the overall productivity of Senior Attorneys 
to be approximately 25-30 percent more productive that ``non-senior 
attorney'' decision writers. Unfortunately, the potential effectiveness 
of this program has been somewhat decreased by the continued fierce 
opposition of many of the Agency's ALJs, some hearing office managers, 
and many senior SSA officials, all of whom have their own agendas. 
Despite this persistent opposition, the Senior Attorney Program 
produced nearly 100,000 decisions in 1996 and 1997. With less organized 
opposition, NTEU is confident that the Senior Attorney Program can 
produce at least 75,000 decisions in fiscal year 1999 and over 100,000 
decisions in fiscal year 2000 without significantly impacting upon ALJ 
case production. Quality Assurance studies conducted by the Appeals 
Council have demonstrated that the accuracy rate of Senior Attorney 
decisions significantly exceeds that of Disability Process Redesign's 
Adjudication Officers and is somewhat higher than that of on-the-record 
ALJ decisions. The accuracy of the Senior Attorney decisions combined 
with the significantly lower payment rate of Senior Attorneys 
(approximately 25 percent) again demonstrates that the Senior Attorney 
Program can reduce the time deserving claimants must wait for a 
decision by as much as a year in many hearing offices. During the 
course of the Senior Attorney Program, the overall payment rate at OHA 
has significantly declined thereby incurring a substantial savings in 
program costs. Additionally, the implementation of the Senior Attorney 
Program has not resulted in an unacceptable increase in the number of 
ALJ decisions awaiting drafting.
    OHA has a long history of cyclical fluctuations in the cases 
awaiting drafting which can make comparisons in workload status 
somewhat misleading. OHA has established a goal that cases awaiting 
decision drafting not exceed a 10 day limit. NTEU believes that 
claimants are entitled to decisions on their applications as quickly as 
possible, and that cases decided by ALJs should be drafted as 
expeditiously as possible. However, too much emphasis has been placed 
upon the goal of maintaining the decision drafting pending level at 10 
days at the expense of claimants who deserve, but will be deprived of a 
timely award of benefits. The average processing time of a disability 
case adjudicated in OHA hearing offices was 381.54 days at the end of 
December 1997. If the OHA goal of 10 days is met, the time the case has 
spent awaiting decision drafting constitutes approximately 2.5 percent 
of the time OHA currently requires to process a case; if the awaiting 
decision drafting time were to increase to 20 days, it would still be 
only 5 percent of the total processing time. The problem at OHA is not 
the time a case awaits decision drafting, but the months and months it 
awaits a hearing and/or it awaits a decision by an ALJ. The Senior 
Attorney Program has resulted in deserving claimants receiving a 
favorable decision with an average processing time of approximately 120 
days as compared to the over 1 year for a case requiring an ALJ 
hearing. In other words, approximately 120,000 deserving claimants 
received their favorable decision only four months after filing because 
of the Senior Attorney Program. Service to the public demands that the 
Senior Attorney Program be vigorously supported.
    While the number of cases awaiting decision drafting has risen 
since September 1996, the single biggest factor in that increase is the 
marked reduction of decisions drafted by ALJs. Interestingly enough, 
despite the decline in ALJ decision drafting, SSA has purchased an 
expensive notebook computer for each ALJ. Given the fact that few ALJs 
draft decisions, and virtually none draft the much more difficult 
denial decisions, the Agency's willingness to spend such a substantial 
sum on notebook computers for ALJs while requiring its ``decision 
writers'' to use obsolete machines and software, is an insight to the 
Agency's priorities.
The Adjudication Officer (AO) initiative of the disability process 
        redesign
    The primary Long-Term Initiative purporting to improve the OHA 
workload is the Redesigned Disability Process (DPR). However, at the 
outset of DPR, SSA admitted that is was not intended to deal with the 
two largest problems plaguing the Social Security disability system, 
the lack of an effective Continuing Disability Review (CDR) and the 
backlog at OHA. SSA subsequently claimed that one goal of the 
Adjudication Officer Initiative was to reduce the OHA backlog. The DPR 
consists of 83 separate initiatives of which GAO noted over a year ago 
that none have been completed. That situation has not changed. It is 
interesting to note that the United States won World War II in less 
time than it has taken SSA to attempt to implement the AO Program.
    The initiative that SSA believes will provide relief to the OHA is 
the Adjudication Officer Initiative which began testing in November 
1995. Despite the highest level of priority, carefully selected 
personnel, a priority on data processing equipment, and the 
establishment of closely controlled, ideal test conditions, AO 
productivity remains one half the level predicted by the DPR model. SSA 
has admitted that the DPR model upon which implementation of DPR is 
predicated is flawed. Yet, at the outset of the AO test, SSA was so 
confident in the reliability of the model that it questioned the need 
for testing at all, and publicly stated that the test was not a test of 
the concept, only a test to fine tune implementation of the AO Program, 
The AO concept has undergone extensive and rigorous testing since it 
was implemented in November 1995. In February 1997, significant changes 
in the AO process were implemented and subjected to the on-going 
testing procedures. The results have not significantly changed; 
productivity remains approximately 50 percent of the projected levels 
and severe quality problems persist. Recently the Office of Workforce 
Analysis (OWA) issued a harshly critical assessment of the AO Program. 
OWA found that the AO Program was not cost neutral, and that it did, in 
fact, increase program costs.
    Currently, OHA has approximately 7,500 employees including central 
office and regional office support staff and the Office of Appellate 
Operations (the Appeals Council) who are not directly involved in 
hearing office productivity. The DPR originally estimated that AO 
productivity would be two (2) ``clearances'' a day requiring 
approximately 1,500 Adjudication Officers. Additionally, DPR 
contemplated that 3 support staff persons would be needed to support 5 
Adjudication Officers. After nearly two years of testing, productivity 
is still only slightly above 1 case a day in the best of circumstances. 
Such a level of productivity demonstrated in a carefully controlled 
test, is unlikely to be matched in a ``real world'' full scale 
implementation. Nonetheless, even accepting a productivity of 1 per 
day, 3,000 Adjudication Officers will be needed and nearly 2,000 
additional support staff. SSA has avoided providing documentation 
regarding the number of support persons involved in the AO test, but 
NTEU believes that the level of support required has been significantly 
greater than anticipated. Full implementation of the AO Program will 
require nearly as many people as OHA currently employs in its hearing 
offices and yet these people are performing only a relatively small 
portion of the work currently performed at OHA hearing offices. Of 
course, if the DPR blueprint is accurate, the work of these 5,000 
people will reduce the number of claimants requiring ALJ hearings by 25 
percent, approximately the same amount already accomplished by the 
approximately 500 Senior Attorneys in the hearing offices.
    By any objective measure the AO test has been a nearly complete 
failure. Yet SSA has continued to pursue this failed program to the 
detriment of other programs which do significantly improve the 
disability adjudication process. The DPR, particularly the AO test, has 
had no measurable effect upon the workload of OHA except consuming 
resources, both human and material, that could have been put to much 
better use.
Recommendations
    1. The Senior Attorney program has significantly reduced the delay 
in granting deserving disabled people their disability benefits, 
stabilized the OHA workload, and reduced the overall payment rate at 
OHA, thereby contributing to a savings in program costs with a 
relatively small outlay in funds. NTEU recommends that funding for this 
program be continued to ensure 75,000 Senior Attorney decisions are 
rendered in fiscal year 1999 and 100,000 Senior Attorney decisions are 
rendered in fiscal year 2000.
    2. Modern computer hardware (including notebook computers) and 
software to facilitate the decision process should be provided to those 
individuals responsible for drafting the vast majority of OHA (ALJ and 
Senior Attorney) decisions.
    3. The Adjudication Officer Initiative of the Disability Process 
Redesign should be immediately suspended or terminated and at least 
some of the funds scheduled for that project should be redirected to 
effective efforts at reducing the OHA backlog.
    Thank you again for the opportunity to appear. I would be happy to 
answer any questions.
                                 ______
                                 
Prepared Statement of Emily S. DeRocco, Executive Director, Interstate 
               Conference of Employment Security Agencies
Overview
    The Interstate Conference of Employment Security Agencies (ICESA) 
is the national organization of state officials who administer the 
nation's public Employment Service, unemployment insurance laws, labor 
market information programs and, in 41 states, job training programs. 
In most states, these officials are also responsible for coordinating 
workforce development one-stop centers, and they play an important role 
in welfare-to-work services.
    As you know, appropriations for administration of unemployment 
insurance programs, employment services, labor market statistics, and 
certain veterans employment programs come from the Unemployment Trust 
Fund (UTF). The UTF, like the Social Security Trust Fund, is made up of 
dedicated revenues from state and federal employer-paid payroll taxes. 
While the trust fund revenues are sufficient to fully fund the 
operation of those programs, the focus on elimination of the federal 
budget deficit and the inclusion of unemployment trust funds in budget 
deficit calculations have undermined the funding arrangements set up by 
the system's founders. Less than 60 percent of estimated fiscal year 
1998 FUTA revenues were appropriated for employment security 
administration. A survey by ICESA a year ago showed that 43 states were 
using over $200 million in state funds to supplement federal 
appropriations for employment security administration.
    Frustration with the federal budget and appropriations process has 
convinced many states that a fundamental change in the administrative 
funding arrangements of the employment security system is needed. A 
coalition of states and business interests has developed a proposal to 
shift responsibility for collection of federal unemployment taxes to 
the states which would retain most of the funds. Twenty-six states 
currently support this proposal, and the House Ways and Means 
Committee, Subcommittee on Human Resources, intends to consider the 
legislation this session.
One-Stop Employment Service
    For the last several years, Congress has been considering bills to 
consolidate job-training programs and develop an integrated workforce 
development system. Even though no legislation has yet been enacted, 
the public policy discussions have yielded substantial support at all 
levels of government for a one stop service delivery system, i.e., 
ensuring that customers--jobseekers and employers--can access the full 
array of employment, unemployment, training, and labor market 
information services easily and through a single source. As a result, 
beginning in fiscal year 1994, the Department of Labor requested and 
the Congress began appropriating resources to be used as one stop 
grants for states to design and implement one stop career center 
systems.
    The Department of Labor and virtually all of the states view the 
state Employment Services as the essential ``glue'' that holds together 
the one-stop systems. While one stop grants--available to states for 
three years--have been used to build linked information systems, in 
some cases to integrate services in shared physical facilities, and to 
develop and implement new customer-friendly technologies and service 
delivery approaches, continued high quality, customer friendly service 
in communities across the nation will depend upon the strength of the 
foundation or infrastructure of the one stop system. As states complete 
their third year one stop grants--the first one stop implementation 
states' third year grants will expire in fiscal year 1999--the 
continued vitality and success of their one stop systems will be 
dependent upon their basic employment and training program funding. 
This means the state Employment Service state allotments must be shored 
up or the success of one-stop career center systems will be short-
lived.
    As implementation of one stop systems is accomplished and one stop 
funding trends downward, we ask you to commit additional funds to ES 
state allotments- the foundation of the one stop center systems and the 
assurance of universal services for both jobseekers and employers--
rather than funding new initiatives. The states are requesting $811 
million to support state ES allotments.
    In addition to their importance to the continued operation and 
success of state one stop systems, the state Employment Services ensure 
the only linkage between employment and training programs and the 
unemployment insurance system. The Employment Services are the vehicle 
to provide job search assistance to individuals who have been 
``profiled'' and identified as likely to exhaust their UI benefits and 
still be unemployed. Research conducted by the U. S. Department of 
Labor and evaluated by Mathematica Policy Research, Inc., has shown 
that intensive job search assistance to unemployment insurance 
beneficiaries reduced receipt of benefits by an average of three-
quarters of a week.
    This may not sound significant until you translate it into dollars 
and impact on the federal budget. Using economic assumptions in the 
President's Budget, there are estimated to be about 8.1 million 
unemployment insurance beneficiaries in fiscal year 1999. The average 
weekly benefit amount is estimated at $198.50. A reduction of three-
quarters of a week of benefits would save the unemployment trust funds 
$148.88 per beneficiary. If funds were available to state Employment 
Services to provide job search assistance to just 30 percent of the 
total number of beneficiaries--2.4 million UI beneficiaries--the 
savings to the unemployment trust fund would be $357,312,000. The cost 
of providing the services would be approximately $137,856,000 (based on 
estimated average state time spent per beneficiary and staff salaries). 
This yields net savings to the trust fund of $219,445,000 in one year. 
Thus, each dollar invested in the Employment Service and directed to 
serving UI claimants saves the unemployment trust fund and the federal 
budget about $2.59. The importance of the linkage between the 
unemployment insurance system and a strong Employment Service cannot 
and should not be ignored.
    Again, an $811 million investment in the state Employment Services 
is critical to the one stop systems in the states, to providing 
effective job search assistance to unemployed workers and saving trust 
fund dollars, and to maintaining and enhancing new electronic tools to 
efficiently and effectively match jobseekers to available jobs.
National Activities--Employment Service
    In addition to state Employment Service allotments, there are three 
programs/initiatives funded under ES national activities that are 
critical:
    The Electronic Labor Exchange--The state Employment Services are 
the source of the job vacancies currently listed in the highly 
acclaimed and often cited America's Job Bank. The success of this 
electronic labor exchange tool is well known. To illustrate its growing 
popularity, in July 1996, 7.2 million customer transactions were 
recorded, and in June 1997, over 29 million transactions were recorded, 
making AJB one of the most visited websites on the Internet. This tool 
is only valuable to jobseekers as it continues to contain active job 
vacancies, provided through the state Employment Services and their 
outreach to employers across the nation. In the coming year, America's 
Talent Bank, the resume side of the electronic labor exchange, will be 
available to job seekers and employers. We urge you to continue 
supporting these exciting tools of the state Employment Services.
    Alien Labor Certification--Federal alien labor certification laws 
ensure that admission of foreign workers on a permanent or temporary 
basis does not affect adversely the job opportunities, wages and 
working conditions of U.S. workers. State employment security agencies 
(SESAs) must oversee and evaluate the recruitment efforts of employers 
for U.S. workers and assure that ``prevailing wages'' are being offered 
for particular positions before a certification can be issued that the 
employers can hire foreign workers.
    Federal funding for administration of the Alien Labor Certification 
program by SESAs has been cut dramatically in recent years. In fiscal 
year 1997, state allocations were cut by an average of 50 percent from 
fiscal year 1996; a number of states were cut by more than 60 percent. 
In fiscal year 1998, the President's budget requested the same level of 
appropriations as fiscal year 1997, but it also stated that the 
Administration would seek legislation--which was never submitted--to 
authorize fees to support this program. These fees were estimated to 
bring in approximately $19.2 million in fiscal year 1998. The 
combination of this severe cut in funding and a significant increase in 
cases brought about by changes to federal immigration laws has resulted 
in huge backlogs-more than a year in some states. The frustration of 
parties to the pending cases has resulted in bomb threats and other 
threats of violence to state agencies. Several states are considering 
whether to refuse to continue to operate the program under these 
untenable conditions.
    In order to address this critical problem, it is essential that 
this committee restore funding to at least $50.5 million--which is the 
total of fiscal year 1998 appropriations, $31.3 million, plus the 
estimated, but non-existent, fees of $19.2 million. We also ask that 
the committee direct the Department of Labor to work with the state 
employment security agencies to streamline procedures and eliminate 
unnecessary and bureaucratic red tape that chokes the certification 
process.
    The Work Opportunity Tax Credit (WOTC) and Welfare to Work (W2W) 
Tax Credit are federal tax credits administered by state employment 
security agencies that encourage employers to hire certain jobseekers. 
Both programs enjoy broad bi-partisan support from Congress and the 
Administration. WOTC was recently extended through June 30, 1998, and 
will likely be extended at least through fiscal year 1999. The Welfare-
to-Work (W2W) Tax Credit program, which provides tax credits to 
businesses that hire the hardest to employ welfare recipients, is in 
effect through April 30, 1999.
    In order for state agencies to make timely certifications of 
eligibility so businesses can claim the tax credit, administrative 
funds are essential. ICESA requests $20 million for state 
administration of these two programs.
Unemployment Insurance
    We would like to thank the subcommittee for its support for a 
special appropriation of $200 million in the fiscal year 1998 
appropriations bill to bring state employment security agency computer 
systems into compliance with the Year 2000. These funds have been 
allocated, and ICESA's members are working diligently to revise 
millions of lines of program code to ensure that payment of 
unemployment benefits is not disrupted due to the ``millennium 
problem.'' Although the timetable is still very tight, Year 2000 
compliance would have been an impossible task for many states without 
these funds.
    Even during this time when our economy is healthy and dynamic, the 
unemployment insurance system plays a larger economic role than might 
be imagined. A dynamic economy means that skilled workers may be laid 
off from jobs in one sector of the economy and may find new ones in 
another sector. During the time they look for new jobs, unemployment 
benefits provide temporary wage replacement. State unemployment 
insurance programs are expected to pay $23.2 billion in benefits to 8.4 
million unemployed workers and collect $22.4 billion in state 
unemployment taxes during fiscal year 1998. Estimates for fiscal year 
1999 project 8.1 million beneficiaries, benefit payments totaling $24.2 
billion, and state unemployment tax collections of $24.2 billion.
    The federal-state partnership in the unemployment insurance program 
has worked well during most of the 62-year history of the program. The 
federal partner's responsibility for providing adequate funds for 
proper and efficient administration of state laws resulted in 
establishment of a system of administrative funding based on hard data: 
workloads (e.g., claims filed, payments made, employers subject to the 
state law) accomplished; staff productivity factors; and the salaries 
of state merit system staff. In recent years the gap between the 
funding needed based on these data and the amount actually provided has 
become so wide that it is not clear to states that a connection exists 
between these ``need factors'' and the funding provided.
    For fiscal year 1999, we urge you to provide $2.369 billion--the 
President's request--for state unemployment insurance activities.
    In addition, we urge you to appropriate $91 million authorized for 
unemployment insurance integrity activities in fiscal year 1999 by the 
Balanced Budget Act of 1997. These funds are needed to support 
intensified tax collection/audit and claims monitoring activities. 
These funds will be used to: reduce accounts receivable; register and 
tax all new employers immediately; improve collection of delinquent 
taxes; implement/improve fraud cross match programs; train staff in 
claims adjudication; and improve detection and collection of benefit 
overpayments. This $91 million appropriation will be more than offset 
in the federal budget by increased taxes collected and overpayments 
prevented or recovered.
Labor market information
    In the debate surrounding workforce development reform, there is 
clear consensus that accurate and timely labor market information is an 
essential part of our economic infrastructure, providing information 
about employment, jobs, and workers. Such information is an invaluable 
resource for jobseekers, businesses, educators, and young persons who 
are planning careers--answering their questions of: Where are the jobs 
of the future? What changes are occurring in the skill requirements for 
today's and tomorrow's jobs? Which industries are growing rapidly? 
Where are layoffs occurring?
    State employment security agencies in cooperation with the Bureau 
of Labor Statistics and other federal agencies produce most labor 
market information. This cooperative system provides a sound basis upon 
which to build an expanded and readily accessible nationwide system of 
labor market information envisioned by workforce development reform 
legislation currently under consideration by the Congress. Today's 
information technology presents a dazzling array of opportunities to 
integrate labor market information with education/training and job 
matching data into exciting and powerful new systems. ICESA supports an 
appropriation of $55 million for BLS Cooperative Programs.
Veterans' employment and training
    Congress has made it clear that providing employment services for 
veterans is a national responsibility. Title 38 of the U.S. Code 
includes provisions for special employment services for veterans, with 
priority given to disabled and Vietnam era veterans, through the 
Disabled Veterans Outreach (DVOP) and Local Veterans Employment 
Representative (LVER) programs. DVOPs and LVERs serve our veterans 
population by helping to ensure a smooth transition of separating 
military personnel into the civilian workforce.
    Title 38 also provides formulas to determine DVOP and LVER staffing 
levels. Since 1990, appropriations for DVOPs and LVERs have not 
supported the number of positions authorized by the statutory formulas. 
In fiscal year 1997, the appropriation funded 440 fewer DVOP 
specialists and 260 fewer LVER staff than authorized by the statutory 
formulas. Many local offices and one stops no longer have any veterans' 
staff. ICESA encourages the committee to explore funding above last 
year's level that would allow at least one DVOP and LVER in every full-
service office. Specialized veterans' employment representatives 
working in state employment service offices and one-stop career centers 
nationwide will help ensure that our nation does not abandon the fine 
men and women separating from the military.
Job training
    While economic growth in the United States is the envy of the rest 
of the world, one of the problems of our current economy is a lack of 
qualified workers for many job openings. The economic sectors where 
there are labor shortages include entry level jobs, where potential 
workers need basic skills, as well as information technology jobs where 
workers with highly specialized skills are needed. Federal job training 
programs for disadvantaged adults and youth help to prepare welfare 
recipients, students, and others to enter the labor force; programs for 
dislocated workers help them to develop new skills needed to 
participate in the ``new economy.'' We urge your continued support for 
federal job training programs authorized by the Job Training 
Partnership Act.
Conclusion
    In summary, our message is one of encouraging efficient and 
effective investment of public resources in a strong workforce 
development system built on the infrastructure that exists today. With 
your help and targeted investment, we have the ability to link 
unemployment, employment, labor market information, and training 
programs together to provide seamless, high quality customer service to 
America's employers and jobseekers.
                                 ______
                                 
  Prepared Statement of Glenn A. Grant, Esq., Business Administrator, 
                             City of Newark
    Dear Mr. Chairman, thank you for the opportunity to submit written 
testimony on behalf of a proposed pilot project in Newark, New Jersey 
designed to identify and address the needs of a most vulnerable part of 
our population--children affected by domestic violence. The City of 
Newark is seeking $1 million for the Newark Kids Initiative, which is 
an effort to identify members of this at-risk group, diagnose their 
needs, and improve the system that provides services to them.
    Newark is home to over 275,000 residents, and is the most densely 
populated city in the state of New Jersey. Newark suffers from other 
concurrent difficulties, including a high unemployment rate, low per 
capita income, and poor literacy rates. The children of Newark suffer 
from a range of poverty-related ills: a high infant mortality rate, low 
birth weights, low immunization rates, and a low rate of routine ``well 
child'' care. When a child suffering from these and other problems, is 
also exposed to domestic violence, they have a broad range of physical, 
psychological and emotional needs.
    The City of Newark Police Department has taken an aggressive stand 
in response to calls to domestic violence situations. In 1997, officers 
received approximately 10,000 calls, with nearly 4,000 of those 
reported as Uniform Crime Report recognized cases. Most of these calls 
involve a combination of abusive behaviors, physical, sexual or 
emotional assault, and drug or alcohol abuse in the home. Through a US 
Department of Justice grant, Newark officers are being trained in 
techniques to respond to domestic violence. The Police Department, 
though, is just a first step in getting help to these families in 
crisis. The mission of the Police Department does not, and cannot, 
address the needs of the youngest victims of abusive family 
situations--the children. In the most severe cases, referrals are made 
to the New Jersey Division of Youth and Family Services, and a child 
may removed from the home. However, more often, the abusive parent and 
the children remain in the home, with a loose and uncoordinated 
``safety net'' in place to aid the family.
    At the same time, the City Department of Health and Human Services 
and community service organizations see a broad range of health and 
social problems presented in their clientele under the age of 12, most 
of which stem from, or are exacerbated, by substance abuse. This 
substance abuse may be by parents or others in the home itself, in the 
neighborhood, or by the children themselves. The drug treatment 
facilities in the City are not able to handle the volume of cases 
presented, and do not provide the kind of extensive counseling and 
follow-up the entire family may need.
    The City of Newark proposes to establish a pilot project to 
identify children affected by domestic violence, research the problems 
specific to their situations in partnership with a local university, 
assess their needs, and provide referrals to the appropriate service 
providers. The program will explore possible linkages to court-ordered 
sanctions, and will work to ensure that treatment and staff training 
are sensitive to cultural norms while working enhance family 
cohesiveness.
    It is estimate that the pilot program will include 100 families, 
who will be the subjects of intensive evaluation, research, and 
coordinated service referrals. Trained civilian staff will be hired to 
assist the Police Department in identifying at-risk families and their 
children under the age of twelve from the pool of reported domestic 
violence cases. The university partner will perform in-depth research 
on the problems involved, and develop training, treatment, and referral 
protocols to address the needs of children. This may include substance 
abuse treatment for parents, medical assistance to family members, 
family and individual counseling, or other modalities discovered or 
recommended through the research. The Newark Department of Health and 
Human Services will serve as a case coordination entity for the 
children, and support and train community agencies as needed to provide 
necessary services.
    Federal assistance is requested to support the dedicated staff of 
both the Police Department and Health and Human Services Department, 
contract with a local university to perform the study and provide 
treatment recommendations, and support training for pertinent community 
service agencies to deal with the full range of problems presented by 
the children of domestic violence. The Newark Kids Initiative could 
indeed serve as a model for the nation's most vulnerable residents, 
thereby breaking the cycle of family violence.
                                 ______
                                 
Prepared Statement of Josephine Nieves, MSW, Ph.D., Executive Director, 
                 National Association of Social Workers
    On behalf of the 155,000 members of the National Association of 
Social Workers (NASW), I respectfully request that you consider NASW's 
funding requests, as well as the attached recommended report language 
to accompany the fiscal year 1999 Labor/HHS/Education Appropriations 
bill.
    NASW's requests focus on two important areas: the maintenance of 
fiscal year 1998 discretionary funding ($6 million) for Child Welfare 
Training, Title IV-B, Section 426 of the Social Security Act, and an 
increase in fiscal year 1999 funding for the health professions 
training programs administered by the Health Resources and Services 
Administration (HRSA) to $306 million.
Maintain funding for the Child Welfare Training Program, Title IV-B, 
        Section 426, of the Social Security Act, at the $6 million 
        level
    NASW requests that Child Welfare Training, Title IV-B, Section 426 
continue to be funded at the fiscal year 1998 level of $6 million. This 
program is administered by the Administration for Children and Families 
in the Department of Health and Human Services (HHS). Child abuse and 
neglect has reached staggering levels. The need for skilled and highly 
qualified workers in our child welfare system is greater than ever. The 
enclosed recommended report language ensures the availability of 
professionally trained social workers within the child welfare system. 
The increased funding would help expand the pool of much-needed 
professional child welfare workers.
Increase funding for health professions training programs administered 
        by HRSA in HHS to $306 million
    NASW requests that the Subcommittee increase funding for Title VII 
and VIII (Public Health Service Act) programs to $306 million. It is 
important to provide adequate funding for the health professions 
programs, which are crucial to ensuring an appropriate supply of health 
and mental health professionals, including social workers. These 
programs have been instrumental in increasing the number of health 
providers from minority backgrounds, fostering community-based 
education, and enhancing service to underserved communities.
    Enclosed is recommended report language, which is similar to 
language included in the fiscal year 1998 House and/or Senate 
Appropriations Committee Reports for the Departments of Labor, Health 
and Human Services, and Education. This includes report language that 
addresses the need for standards and guidelines on training mental 
health professionals, including social workers, for practice in primary 
care and managed care settings targeted to underservedand rural 
communities. The language encourages collaboration between HRSA and the 
Substance Abuse and Mental Health Services Administration (SAMHSA) in 
preparing health professionals to work in public health settings and 
managed care organizations.
    Additionally, the National Institutes of Health (Nod) has 
effectively implemented fiscal year 1997 and fiscal year 1998 report 
language encouraging them to form a working group of appropriate 
institutes on child abuse and neglect research. The working group, led 
by the National Institutes of Mental Health (NIMH), is addressing the 
need to coordinate child abuse and neglect research within NIH, 
developing a consensus on a research agenda, and providing some 
leadership with other federal agencies involved with child abuse and 
neglect research. NIH Director Dr. Harold Varmus issued a report in 
April 1997 that outlined NIH current research efforts in this critical 
area and made recommendations for future action. We feel it is critical 
to recognize what NIH has done and to encourage them to continue by 
including fiscal year 1999 report language, which is enclosed.
    Also included is recommended report language supporting additional 
social work research and training programs in NIH, SAMHSA, and Centers 
for Disease Control and Prevention. We hope that you will give our 
requests for funding and our suggestions for report language serious 
consideration throughout the appropriations process.
    We appreciate the support you have given on appropriations issues 
important to social workers and the clients we serve. If you have any 
further questions or need any information, please contact Madeleine 
Golde, Government Relations Staff Associate, at 202-336-8237.
                                 ______
                                 
        Prepared Statement of the American Academy of Pediatrics
    On behalf of the American Academy of Pediatrics and the endorsing 
organizations, the Society for Adolescent Medicine and the Ambulatory 
Pediatric Association, we would like to submit this statement for the 
record.
    Fortunately, most infants are born healthy and continue to grow and 
develop normally if they have access to and receive basic health care 
services. Unfortunately, there are still far too many that suffer 
needlessly from disease, injury, abuse, and a host of societal 
problems. Our task as pediatricians is to promote preventive 
interventions and to diagnose, treat and manage acute and chronic 
problems of children and adolescents. Your task is to provide the funds 
to sustain vital federal programs that underpin and complement these 
efforts. As pediatricians we recognize the integral tie between basic 
research and the care we provide; we see the impact of poverty and 
violence on the health of our children and adolescents; and we know 
that the future of our workforce depends on the decisions we make 
today. We ask that you continue to recognize the importance of 
preventive and chronic health services, research, and the education and 
training of pediatricians and other health professionals and to 
appropriate the necessary funds to the extent possible.
    A chart at the end of this statement will offer funding 
recommendations for many programs, but we would like to focus on a few.
Prevention and early intervention
    Childhood Immunization Program.--The CDC's childhood immunization 
program is the cornerstone of preventive health care for children 
served in the public sector and for uninsured children. Tremendous 
strides in establishing effective immunization programs have been made 
over the past few years. In addition to the cost-effectiveness of 
vaccines, the number of reported cases of vaccine preventable diseases 
are at or near all time lows. Immunization levels of two-year old 
children are the highest ever recorded. We attribute this, in part, to 
the Vaccines for Children (VFC) Program and encourage Congress to 
maintain its commitment to ensuring its viability. The VFC program 
combines the efforts of public and private pediatricians and other 
health care professionals to accomplish and sustain vaccine coverage 
goals for both today's and tomorrow's vaccines. It removes vaccine cost 
as a barrier to immunization for some and reinforces the concept of a 
``medical home.'' To date, its successful implementation has resulted 
in the enrollment of more than 40,000 public and private provider 
sites. Yet, despite this good news, the most recent National 
Immunization Survey reports that nearly 1 million two-year-olds still 
are under-immunized. Furthermore, adolescents continue to be adversely 
affected by vaccine preventable diseases (e.g., varicella, hepatitis B, 
measles and rubella). Comprehensive adolescent immunization activities 
at the national, state and local level are needed to achieve national 
disease elimination goals. In addition, continued investment in CDC 
efforts to assist states in developing immunization information systems 
will serve to maintain high immunization levels by reminding parents 
when immunizations are due/overdue. It also helps pediatricians and 
other health care professionals know the immunization status of the 
children they serve. Obviously, the ultimate goal of immunizations is 
eradication of disease; the immediate goal is prevention of disease in 
individuals or groups. Until other remedies are firmly in place, the 
continued investment in CDC efforts must be sustained. In fiscal year 
1999 the Academy and the endorsing organizations recommend at least 
$539 million for CDC's Childhood Immunization program.
    Maternal and Child Health Service Block Grant.--The MCH Block Grant 
is a ``block grant'' that works. It provides preventive and primary 
care services to 17 million women and children, including 11.3 million 
infants, children and adolescents, 900,000 children with special health 
care needs as well as preventive services to approximately 4.8 million 
women--including one-third of all pregnant women in the U.S. The MCH 
Block Grant includes an important set-aside of 15 percent percent to 
support the Special Projects of Regional and National Significance 
(SPRANS) to improve maternal and child health and promote more 
effective delivery systems. One example is the Healthy Tomorrows 
Partnership for Children Program, a collaborative venture between the 
MCH Bureau and the Academy. The Healthy Tomorrows Partnership projects 
represent a new initiative in a community or an innovative component 
that builds upon existing community resources. These projects have 
provided: primary care for uninsured children and children insured 
through the Medicaid program; intervention and care coordination for 
children with special health needs; interventions for health promotion 
through risk reduction in families; adolescent health promotion; 
expanded perinatal care and parent education services and services for 
special child and family populations. Projects have been funded in a 
variety of communities including: Washington, DC; Chicago; New Haven; 
Dallas; Anchorage; and Milwaukee. Another important component of the 
MCH Block grant is that it addresses interdisciplinary adolescent 
health training and services and research for both the physical and 
mental health needs of adolescents. The Office of Adolescent Health 
supports initiatives such as health care programs for incarcerated 
youth, health care services for minority group adolescents, and 
violence and suicide prevention. We support the funding of the MCH 
Block Grant program at its full authorization of $705 million--a modest 
3.5 percent increase which will help to preserve and improve crucial 
public health services for children and mothers including outreach to 
the most vulnerable and at-risk families under the new State Child 
Health Insurance Program (SCHIP).
    Tobacco.--The Academy and all of the pediatric community have 
strived for decades to curb children's and adolescents' access to and 
use of tobacco. This is a silent and deadly plague. Each day 3,000 
children nationally begin to use tobacco. Of those people who will ever 
smoke, 90 percent begin before age 19. Young smokers suffer from 
respiratory problems and asthma, and among teens who are regular 
smokers, one in three will die prematurely from smoking. Overall, 
tobacco-related illnesses claim the lives of over 400,000 Americans 
each year. Tobacco prevention and cessation efforts must involve 
pediatricians, parents, schools and communities. Not only do we counsel 
our patients about the addictiveness of nicotine and its detrimental 
health effects; we also discuss with parents the impact of secondhand 
smoke on their children. Additionally, we hope to work with you to make 
sure that federal, state and local programs are effective at preventing 
tobacco use. Tobacco use truly is a ``pediatric disease'' that is 
completely preventable. We recommend at least $61 million for CDC's 
Office on Smoking and Health in fiscal year 1999, this includes funds 
for the transfer of the tobacco prevention and cessation program 
(ASSIST) currently housed at the National Cancer Institute. These 
programs have proven records of success at reducing smoking rates. The 
105th Congress has the historic opportunity to more fully address 
tobacco control issues now and save lives. We urge you to support well-
funded and comprehensive tobacco control legislation.
    CDC injury prevention.--Injury is the leading cause of death and 
disability among children and young adults (ages 1-44). Unintentional 
injury and intentional injury are the leading causes of death for 
children and adolescents. Countless others are injured and disabled. 
Injury is costly on multiple levels--in the emotional toll it takes on 
its victims and on their families; in direct medical expenses (acute 
and chronic); and in long-term economic costs due to the years of 
potential life and productivity lost (especially with respect to 
children). In direct medical costs alone, injury costs the federal 
government $12.6 billion annually, and an additional $18.4 billion each 
year in disability and death benefits. Therefore, measures to prevent 
injury or reduce its severity are extremely cost-effective. The 
National Center for Injury Prevention and Control (NCIPC) fulfills a 
unique function in this undertaking. It works closely with other 
federal agencies; national, state, and local organizations and 
community groups; state, tribal,\1\ and local health departments; and 
research institutions to monitor injury and to develop, evaluate, and 
disseminate effective interventions to prevent injury or reduce its 
impact. The Center's work addresses many types of injuries, both 
intentional (homicide, suicide, physical and sexual assault against 
children and women, youth-perpetrated violence) and unintentional 
(motor vehicle, bicycle and pedestrian injury and home and recreational 
injury, including fires, poisonings, and falls). The Center also 
administers special programs to reduce violence against women, and 
traumatic brain injury. Additional resources would enable the Center to 
continue its important leadership in the ``Safe America'' program, 
through which NCIPC has brought together diverse public and private-
sector entities to develop and disseminate injury prevention 
information and interventions. The initial focus of the effort is to 
reduce injury among children and adolescents. Further support would 
also enable the Center to expand efforts to reduce physical and sexual 
violence against children, develop a comprehensive youth violence 
prevention program, and ensure that every U.S. resident has access to 
the life-saving and cost-effective services of a poison center through 
national or state specific toll-free numbers. To carry out continuing 
and expanded activities, we recommend that the CDC injury prevention 
program be funded at $70 million.
---------------------------------------------------------------------------
    \1\ Deaths due to unintentional injuries are twice the rate for 
Native American children than for children of all other races.
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    Emergency medical services for children.--In 1993, an Institute of 
Medicine report described serious deficiencies in emergency medical 
services for children (EMSC); for example, many ambulance services and 
hospital emergency departments lack child-sized equipment (e.g., oxygen 
masks, IV-tubes, neck braces) and many emergency medical personnel need 
additional training to adequately treat children, whose medical needs 
are very different than those of adults (e.g., children have more 
serious breathing problems, are less tolerant of blood loss, are more 
vulnerable to head injuries, and respond differently to medications). 
The federal EMSC grant program has helped states and localities make 
significant strides in improving EMSC through, for example, the 
development of model training programs, ambulance equipment lists, 
treatment protocols, and triage and transport systems. Grantees' work 
has been widely disseminated so that others can build upon it, thus 
enhancing the cost-effectiveness of the federal investment and the 
opportunity to improve EMSC. We know that the federal EMSC program has 
saved lives. For example, in Kentucky this year, paramedics were able 
to resuscitate a 14-year old girl in cardiac arrest, using skills 
recently acquired through training instituted with EMSC funds. 
Paramedic training and other system components, are necessary but not 
sufficient, however. Localities, states, and inter-state regions must 
get together to designate facilities based on their degree of pediatric 
emergency expertise (similar to the ``Level I, II, II'' trauma care 
designations), and to establish emergency transport protocols and 
inter-facility transfer agreements. Only when such regional systems are 
in place will a critically ill or injured child be sure to get the best 
possible emergency care. Unfortunately, there are few geographic areas 
where such arrangements have been established. The federal EMSC grant 
program is working to spur the development of such systems, an 
especially challenging task in the face of a continuous lack of 
understanding of the unique needs of children. To continue to stimulate 
life-saving EMSC system improvements, we recommend funding this program 
at $15 million.
    Head Start, Early Head Start, child care, after-school care.--The 
Academy strongly supports efforts to improve the accessibility, 
affordability and quality of early child care/education in this 
country. Recently published research on early brain development 
underscores what pediatricians have known for years--that a child's 
care in the earliest years of life are critical in developing his or 
her potential to be a healthy and productive citizen. For older 
children and teens, after-school programs can direct their energies to 
positive activities, and away from juvenile crime, gangs, tobacco, 
alcohol, drugs, and premature sexual activity. Therefore, we recommend, 
at a minimum, funding Head Start and Early Head Start at levels 
necessary to achieve the goals recently proposed by the President--to 
serve one million children in Head Start and 80,000 infants and 
toddlers in Early Head Start by the year 2002. Additionally, we urge 
funding the Department of Education's ``21st Century Community Learning 
Center Program'' at $200 million for fiscal year 1999 in order to 
expand school-based after-school care. We also urge the Committee to 
fully fund any additional spending that might be authorized this year 
to assist families rearing children, whether or not they use out-of-
home child care.
Pediatric research
    Agency for Health Care Policy and Research.--The AHCPR is the 
primary federal agency charged with developing clinically-based, policy 
relevant information for use in improving the health care system, 
providing leadership in health services research and providing training 
for new health services researchers, such as pediatricians. It uniquely 
serves the interest of both health care consumers and health care 
professionals. Important outcomes research supported by AHCPR have 
shown that improving quality of care can save taxpayers hundreds of 
millions of dollars per year. For example, universal implementation of 
guidelines on the treatment of otitis media with effusion, a common 
condition of the middle ear in young children, could cut the total cost 
of care in half and annually save over $700 million. Funding from AHCPR 
has supported several important studies of asthma, including a study of 
the management of acute asthma in pediatric practices and the ASTHMA 
PORT study, currently in process, that is focused on improving quality 
of care and cost savings in the treatment of asthma. In an AHCPR-funded 
study of the assessment of fevers in very young infants, the Academy is 
collecting data on how pediatricians assess febrile infants less than 3 
months of age. One product of the study will be a revised guideline for 
diagnostic work-up for infants with fever. It is anticipated that such 
a guideline will make it possible to eliminate at least 10 percent of 
the hospitalizations for observation and diagnosis of these infants 
that currently occur. Such a result would save $36 million in current 
hospital costs. Another recent AHCPR study on pediatric referrals 
identified factors related to pediatric referrals for specialty care. 
Implications from this study are being discussed in terms of 
interventions that can improve physician referral making in ways that 
impact both the quality and cost of care. To enable the Agency to 
continue its critical research that provides policymakers, health care 
providers, and patients with the information on what works and how to 
best implement what is most effective in health care we recommend 
funding of $175 million for AHCPR in fiscal year 1999. We commend this 
Committee's recognition of and recommend continued emphasis on children 
and adolescent health services issues as an AHCPR priority.
    National Institutes of Health.--Research funded by NIH has made 
great strides in improving the health status of children and youth in 
all aspects of life, from issues of child care and obesity to reduction 
of infant mortality and maternal-to-infant transmission of HIV. These 
research projects and many more improve the quality of life for many 
children and adolescents everyday. For example, research conducted at 
NIH on Sudden Infant Death Syndrome (SIDS) has clearly shown a 
relationship between infant sleep position and SIDS. In fact, as a 
result of the ``Back to Sleep'' public health campaign, the incidence 
of SIDS has been reduced by 38 percent. The development of surfactant, 
which can be administered into the lungs of premature infants, has 
resulted in fewer deaths of infants from Respiratory Distress Syndrome 
(RDS) and has saved an estimated $90 million a year in hospital costs. 
Thus, an investment in children's medical research not only saves lives 
and alleviates suffering, but also reduces future health care 
expenditures. In addition, we endorse the testimony of our pediatric 
colleagues, the Public Policy Council, that outlines in greater detail 
the importance of a strong national pediatric research agenda. We join 
with the Ad Hoc Group for Medical Research Funding in recommending a 15 
percent increase for NIH in fiscal year 1999 and also join the Friends 
of NICHD in supporting $776 million for the National Institute of Child 
Health and Human Development. In order to increase pediatric biomedical 
and behavioral research within NIH, we recommend $50 million for the 
Pediatric Research Initiative.We believe that these requests represent 
the best and most reliable estimate of the level of funding needed to 
sustain the high standard of scientific achievement embodied by the 
NIH. However, we strongly encourage Congress to explore all possible 
options to identify additional sources of funding needed to support 
these increases if we are to reach this goal under the current spending 
limitations.
Education/Training
    Health professions training.--Title VII of the Public Health 
Service Act, Primary Care Training Grants for General Internal Medicine 
and General Pediatrics, remains a small but vital incentive program for 
generalist education and training as well as increasing the pool of 
under-represented minority group pediatricians and other health care 
professionals . These grants provide support for faculty development 
and a large number of residents to receive intensive primary care 
training in diverse ambulatory settings--this is the only federal 
support targeted to training primary care health care professionals. 
Faced with increases in the incidence of AIDS, substance abuse, 
adolescent pregnancy and other health concerns, pediatricians of the 
future will be expected to manage both acute and chronic health 
problems, care for children and adolescents with disabling conditions, 
and effectively screen and counsel for problems that are psychosocial 
or behavioral in nature. Given the complex needs of their patients, 
pediatricians will also be called upon to utilize community resources 
and to collaborate with other health care providers. Title VII grants 
in pediatrics have supported education and training in a variety of 
community and non-hospital based settings such as juvenile detention 
centers, homeless shelters, child nutrition programs, child care 
centers and community health centers. We recommend fiscal year 1999 
funding of at least $25 million for General Internal Medicine/General 
Pediatrics and join with the Health Professions and Nursing Education 
Coalition in supporting, a modest increase of $306 million in total 
funding for Title VII and Title VIII, which is last year's level plus 
medical inflation. We further recommend funding of $125 million for the 
National Health Service Corps a key component of any effort to remove 
barriers to health care and to ensure an adequate distribution of 
health care providers across the country.
Conclusion
    Thank you for this opportunity to provide you with our 
recommendations for the coming fiscal year. In summary, the following 
list highlights programs, along with funding recommendations, of 
importance to children. The Academy joins with its many friends in 
other organizations and coalitions in presenting these recommendations.

Recommendations for fiscal year 1999

Department of Health and Human Services:
    Centers for Disease Control and Prevention..........  $2,800,000,000
        Childhood Immunization Funding..................     539,000,000
        Injury Control..................................      70,000,000
        Lead Poisoning..................................      50,000,000
        Office on Smoking and Health....................      61,000,000
        Folic Acid Supplement Program...................      20,000,000
    Health Resources and Services Administration........   3,734,000,000
        Ryan White Pediatric Demos......................      61,000,000
        EMSC............................................      15,000,000
        Family Planning (Title X).......................     218,452,000
        MCH Block Grant.................................     705,000,000
        National Health Service Corps...................     125,000,000
        Health Professions Training (Total).............     306,000,000
        General I.M/Pediatrics (Title VII)..............      25,000,000
        Agency for Health Care Policy and Research......     175,000,000
    National Institutes of Health.......................  15,694,000,000
        NICHD (Child Health)............................     776,000,000
        NIEHS (Environmental Health)....................     379,624,000
        Pediatric Research Initiative...................      50,000,000
    Administration for Children and Families:
        Child Abuse and Treatment and Prevention:
            Title I Grants to states....................     100,000,000
            Title II Community Based Family Resource and 
              Support Grants............................      66,000,000
        Child Care and Development Block Grant..........   1,000,000,000
    Indian Health Service...............................   2,537,456,000
Department of Education:
    IDEA part B.........................................   4,607,500,000
    IDEA part c (formerly part H).......................     400,000,000
    IDEA section 619....................................     500,000,000
                                 ______
                                 
            Prepared Statement of the Public Policy Council
    This statement is submitted on behalf of the Public Policy Council 
which represents the Society for Pediatric Research, the American 
Pediatric Society and the Association of Medical School Pediatric 
Department Chairmen. These organizations represent thousands of 
pediatric researchers involved in basic, clinical and health services 
research. Our collective goal is to improve the quality of life for all 
of America's children. The scientists represented by our organizations 
come from medical schools, children's hospitals and other research 
facilities. They are the driving force behind the biomedical advances 
that benefit children and they also are the mentors for training our 
next generation of pediatric investigators.
    On behalf of the pediatric academic research community, our 
statement speaks about the importance of increasing funding for 
pediatric biomedical, behavioral and clinical research, and for the 
training of future pediatric bench and clinical investigators.
    Our statement addresses three issues: first, why do we need to fund 
pediatric research; second, why fund pediatric investigators; and 
third, how do we preserve pediatric research and sustain its 
investigators.
What is the Justification for Funding Pediatric Research?
    Infants and children are leading healthier lives. Research funded 
by the National Institutes of Health (NIH) has had a significant impact 
on the well-being of children. As a result of NIH funded research, 
deaths from sudden infant death syndrome (SIDS) have been reduced by 38 
percent, the development of surfactant for infants with respiratory 
distress syndrome (RDS) has saved the lives of premature babies, and 
infants now receive a vaccine to prevent Hemophilus influenza type b 
(HIB) meningitis, one of the leading causes of mental retardation.
    However, there are still many pediatric diseases that are not 
preventable or for which treatment may not exist, may only be 
palliative or is simply inadequate. Even relatively common pediatric 
diseases, such as, cystic fibrosis and juvenile onset diabetes--
diseases that we do know a great deal about--do not currently have a 
cure. Modern therapy for such diseases is cumbersome, costly and 
stressful for children and their families.
    Whereas it is obvious that we want to improve the health of 
children for their own sake, it may be less obvious that improvements 
in pediatric medicine will have far-reaching implications on the 
societal and economic costs of disease in adults. Many diseases usually 
associated with adulthood begin in childhood. A strengthened investment 
in pediatric research will benefit adults as well as children. Why? 
Let's mention just two examples: osteoporosis and diabetes mellitus. In 
both examples, the enormous societal and economic costs of these 
diseases are not incurred during childhood. Nonetheless, both disorders 
have their origins in pediatrics and might be less severe or 
preventable if we focus on these conditions in our children. We know 
that osteoporosis is a disease that causes crippling bone deformities, 
most commonly in post-menopausal women. But to quote a famous expert on 
osteoporosis, ``senile osteoporosis is a pediatric disorder.'' This is 
because all of us deposit bone minerals throughout childhood, 
adolescence, and early adulthood. In fact, by the age of 30, we have 
each achieved our peak bone density. After that, bone mass declines 
throughout the rest of adult life. Deficiencies in bone mass in 
childhood and adolescence thus predispose individuals to lower bone 
mass in adulthood. If we could improve acquisition of bone mineral 
during childhood and adolescence, we might prevent adult osteoporosis.
    Another example is diabetes, which causes tremendous morbidity, 
pain and suffering. There are two types of diabetes that affect adults 
and both types have their origins in childhood. Recent results of a 
large, multi-center NIH-funded study known as the DCCT (Diabetes 
Control and Complications Trial) demonstrate that by tightening blood 
sugar control, long term complication rates are reduced. The study did 
not include prepubertal children and thus, we do not know how tightly 
young children with diabetes should be controlled. Since there are also 
risks associated with tight control, this type of study in children 
must be done. The other type of diabetes known as adult onset diabetes 
is associated with environmental factors such as obesity, high fat 
diets and inadequate exercise. We are now seeing this disease in 
younger and younger children. Is the increased incidence of obesity and 
the sedentary lifestyle of our children predisposing us to an adult 
disease? The only way to answer these questions is with further 
research in pediatrics.
    The importance of the linkage of pediatric research to adult health 
can also be seen in the fact that some families have a genetic tendency 
to develop heart disease. Research indicates that this could be 
associated with a high level of cholesterol in their blood or with high 
levels of triglycerides. Although many children in these families do 
not yet suffer from heart disease the way that adults do, at what point 
does cholesterol begin obstructing blood flow injuring blood vessels 
and subsequently injuring the heart? Should children be treated with 
one of the new cholesterol lowering drugs? If so, which one and when? 
What are the side effects of these drugs in children? Are they the same 
as in adults, or are they more serious? Clearly more research is needed 
and necessary.
    Moreover, as we continue with the human genome project and learn 
more about genes associated with disease, more windows of opportunity 
between early detection and overt symptoms of disease will open for 
intervention. This aspect of that project makes research involving 
children imperative. The ability to precisely determine what disease 
will affect a person will be available before gene therapy can provide 
a cure. Moreover, as we explore this very important opportunity to 
develop preventive strategies through genetic testing of children, we 
must recognize that this is still an evolving area of medical science 
that has social, ethical and psychological implications that will need 
further study. For instance, recently it was discovered that ibuprofen 
(Advil and Nuprin) delays the onset of symptoms in some people who have 
genes that convey the susceptibility for Alzheimers disease. Would 
screening for carriers and treating them in childhood make a 
difference? Do benefits in sixty years outweigh side effects now? Once 
again, we see that to adequately answer these questions, more pediatric 
research is needed and necessary.
Why fund pediatric investigators?
    We are in an age of great technological innovation that has allowed 
for a better understanding of the pathogenesis of disease, enhancing 
diagnostic capabilities and improving the treatment of patients. 
However, the actual practice of medicine is too often based on 
empiricism rather than evidence derived from well-controlled clinical 
trials. Clinical trials when done well can establish the usefulness of 
a particular test or treatment and examine their cost effectiveness 
compared to current practice. Unfortunately, according to a report 
issued by the Government Accounting Office, only 10-20 percent of 
medical practices are based on data from well-controlled studies. Thus, 
when your child or grandchild is being treated for an illness today 
there is only about a one in five chance that the therapy is based on 
solid evidence that it will be helpful.
    There is a growing concern among our academic colleagues that there 
is a looming crisis for the future of pediatric research. Most 
pediatric research is performed at the nation's medical schools, 
children's hospitals and the intramural programs at NIH. As the focus 
of academic health centers shifts away from the traditional roles of 
research, teaching and patient care, to one focused predominately on 
patient care, we are concerned that the quality of training of future 
generations of pediatric medical scientists will be impaired. This will 
in turn jeopardize the future health of our children. There are many 
reasons for this trend, as recently outlined in the NIH Director's 
Panel on Clinical Research 1997 Report, including the specialized, 
complex training and role of teacher-clinician-scientists, student debt 
after leaving medical school, and the changes to the health care system 
brought about by managed care.
How do we promote pediatric research and preserve the training of 
        pediatric investigators?
    The pediatric community applauds the ongoing commitment of 
Congress, through the leadership of this Committee, to increase NIH 
funding. We support the fiscal year 1999 recommendation presented by 
the Ad Hoc Group for Medical Research Funding, that calls for a 15 
percent increase in funding for the NIH as the first step toward 
doubling the NIH budget over five years. This recommendation includes 
support for increased funding for the general clinical research centers 
(GCRCs) which the Public Policy Council also supports. The pediatric 
academic societies endorse the Friends of NICHD Coalition's 
recommendation for the National Institute of Child Health and Human 
Development (NICHD) of $776 million and the overall fiscal year 1999 
Public Health Service funding recommendations of the Coalition for 
Health Funding. In particular, your Committee has helped make pediatric 
research a priority at the highest level of the NIH by establishing a 
new pediatric research initiative that was funded at $38.5 million in 
fiscal year 1998. This is a reasonable starting point. Today, we 
encourage you to increase funding for this initiative to $50 million in 
fiscal year 1999. We recognize the difficulty in achieving these goal 
under the current spending limits. However, we encourage you to explore 
all possible options to identify the additional resources needed to 
support this recommendation.
    Furthermore, we urge increased funding for training programs that 
will attract minority group students into the medical profession, 
encourage medical students to pursue clinical research, support young 
investigators, provide opportunities for mentoring by experienced 
clinical investigators as well as enhance the quality of our mentors. 
We must not short change our children from receiving care from well-
trained and qualified pediatric investigators.
Inclusion of children in clinical trials
    We commend this Committee's recognition and strong encouragement to 
the NIH in fiscal year 1996 ``to establish guidelines to include 
children in clinical research trials conducted and supported by the 
NIH.'' The NIH is developing these guidelines and we foresee the 
implementation later this year. We anticipate that significant advances 
will be gained in understanding the mechanism and improving the 
treatment of pediatric diseases. This new policy is an excellent 
initial step. Moreover, it reflects an important partnership and the 
commitment of the research community to work with the NIH in the 
development of proposals that will increase clinical research 
participation for children without mandating it. However, we believe 
that it should only be viewed as a first step. In order for this policy 
to be effective, it must be followed by other measures. For example, 
detailed and specific mechanisms must be outlined and established that 
will ensure implementation of the policy and a process should be 
established to assess the efficacy (or lack thereof) of the policy in 
generating both data about and therapeutic advances for children. We 
welcome and look forward to working with the NIH on these and other 
implementation issues of the new guidelines.
Conclusion
    As pediatricians and researchers, we know first hand that there are 
many important opportunities for additional pediatric research which 
promise significant return on investment--not only improved health for 
our children today but also economic productivity tomorrow--as these 
children grow into adulthood. We support the increased investment in 
research in general and the new pediatric initiative in particular.
    In summary, the following list highlights programs, along with 
funding recommendations, of importance to children. The Public Policy 
Council joins with its many friends in other organizations and 
coalitions in presenting these recommendations.

Recommendations for fiscal year 1999

National Institutes of Health........................... $15,694,000,000
    NICHD (Child Health)................................     776,000,000
    Pediatric Research Initiative.......................      50,000,000
Agency for Health Care Policy and Research..............     175,000,000
Centers for Disease Control and Prevention..............   2,800,000,000
    Folic Acid Supplement Program.......................      20,000,000
Health Resources and Services Administration............   3,734,000,000
    MCH Block Grant.....................................     705,000,000
    Health Professions Training (total).................     306,000,000
    General I.M./Pediatrics (Title VII).................      25,000,000
                                 ______
                                 
   Prepared Statement of the Association for Health Services Research
    Thank you, Mr. Chairman and Members of this Subcommittee, for the 
opportunity to submit this written statement on the role of health 
services research in improving our nation's health care. The 
Association for Health Services Research (AHSR) is a non-profit 
organization and the only national professional association devoted to 
improving the health status of Americans through health services 
research. AHSR represents more than 2,800 individuals who use and 
produce health services research and approximately 140 organizational 
members, including universities, insurers, providers, major employers, 
and health plans.
    Just as federal funding of biomedical research is essential to 
developing new treatments for disease, a continued strong federal 
commitment to health services research is needed to ensure that these 
discoveries are appropriately translated into the delivery of quality 
health care. By evaluating the effectiveness of health care and the 
ability of the health care system to deliver these services 
efficiently, health services research aids in the transfer of science 
from the laboratory into practical use by physicians and hospitals--
essentially speeding the integration of biomedical research into 
patient care and disease prevention.
    Health services research also plays a critical role in educating 
consumers and purchasers about the care they receive, serving as a 
resource not just for disease treatment and prevention information, but 
also providing information, such as quality data for health plans, that 
enables consumers to better choose their health care. Furthermore, by 
examining the impact of the delivery and financing of health care on 
access and quality, health services research provides the evidence 
needed by policymakers to better determine health care priorities, 
particularly among vulnerable populations and within the Federal health 
Medicare and Medicaid programs.
    Demand for health services research among consumers, employers, 
providers, health plans, and policymakers has never been greater. As 
our nation's health care marketplace continues to become more 
sophisticated and more complex, health services research has become an 
essential resource for making informed decisions about how to deliver 
needed care efficiently. The goal is to identify which treatments work 
best for which patients and to assess the relative cost of those 
treatments so that health care providers and patients can make informed 
decisions about what regimens to choose.
             advancing the role of health services research
    Our country is the world's leader in making some of the most 
remarkable and life-enhancing medical discoveries ever known. 
Integrating these discoveries into health care delivery requires a 
collaborative effort, particularly among the federal government's 
health research agencies. Health services research is not an activity 
about which one can say that if the federal government does not do it, 
the private sector and perhaps a state and local government will step 
in. Lack of federal support will mean a chronic under investment in 
health services research to improve the quality of health care. Each of 
the agencies plays an important role in influencing the delivery of 
health care in America and bring its own contributions or tools to the 
health care quality equation.
Agency for Health Care Policy and Research
    The Agency for Health Care Policy and Research (AHCPR) serves as 
the focal point within the federal government for determining what 
works best in health care. The President has recommended an increase of 
$25 million for AHCPR, or a total fiscal year 1999 budget of $171 
million. These new funds will allow AHCPR to carry out several new 
directives recently mandated by Congress, including:
  --Continued research on improving the quality of care for Medicare 
        and Medicaid beneficiaries, the uninsured, and children, 
        focusing particularly on improving the management of chronic 
        conditions such as congestive heart failure and osteoporosis;
  --Support for the Congressional initiative, the Children's Health 
        Insurance Program, by providing scientific evidence on how to 
        improve quality care for uninsured children;
  --The establishment of centers for education and research, as 
        authorized in the Food and Drug Administration Modernization 
        Act, to increase the awareness of new uses and the risks of 
        drugs and other medical products;
  --Full implementation of the agency's private sector initiatives, 
        including the Evidence-based Practice Centers, which provide a 
        forum for physicians, health plans, employers, and researchers 
        to work together in addressing prevalent and costly health 
        conditions in American society; and
  --Increased awareness of the preventive care recommendations of the 
        U.S. Preventive Services Task Force to encourage screening and 
        immunizations.
    Recommendation.--Recognizing Congress' interest in improving health 
care quality, AHSR strongly believes that the health services research 
activities of AHCPR must be even further strengthened with additional 
funding. AHSR urges the Subcommittee to support an additional $4 
million for AHCPR for a total fiscal year 1999 budget of $175 million.
Health Care Financing Administration
    The Health Care Financing Administration's research arm, the Office 
of Research and Demonstrations (ORD), guides the development and 
implementation of new health care financing policies and evaluates 
their impact on Medicare and Medicaid beneficiaries, participating 
providers, and states. ORD plays a critical role in creating a better 
understanding of how well the Medicare and Medicaid programs are 
performing in terms of access, quality, efficiency, costs, and 
beneficiary satisfaction and in how to further improve program 
performance.
    Recommendation.--AHSR supports the President's fiscal year 1999 
funding request of $50 million for the Health Care Financing 
Administration's Office of Research and Demonstrations.
National Institutes of Health
    As the foremost biomedical and behavioral research institution in 
the world, the National Institutes of Health (NIH) also provides 
significant funding for health services research. While many Institutes 
fund health services research, NIH primarily supports health services 
research through:
  --Prevention and treatment programs of the National Institute of 
        Alcohol Abuse and Alcoholism (NIAAA) and the National Institute 
        on Drug Abuse (NIDA),
  --Studies on risk factors and cost-effective mental health care of 
        the National Institute on Mental Health (NIMH), and
  --Information dissemination activities of the National Library of 
        Medicine (NLM).
    Recommendation.--AHSR supports the President's fiscal year 1999 
budget request for a $1.1 billion increase for the National Institutes 
of Health and, specifically supports the increases proposed for NIAAA, 
NIDA, NIMH, and NLM.
Centers for Disease Control and Prevention
    CDC's National Center for Health Statistics (NCHS) is the nation's 
principal vital and health statistics agency, conducting ongoing 
studies to meet the nation's health information needs. These tools 
provide the basis for research at AHCPR and NIH on specific diseases or 
within certain populations.
    Recommendation.--AHSR supports the President's request of $86 
million for NCHS.
Conclusion
    The Congressional promise to the American people to improve the 
quality of health care will be difficult to keep unless it is coupled 
with increased health services research funding. We can not improve 
quality without a body of evidence-based science to guide clinicians 
and public and private policymakers about what works best and how to 
create systems to deliver good quality care at acceptable cost. The 
degree to which that body of evidence is available and the extent to 
which we succeed in achieving quality improvement in health care will 
depend directly on the level of funding support that is made available 
for health services research.
                                 ______
                                 
Prepared Statement of Alan H. Richardson, Executive Director, American 
                        Public Power Association
    The American Public Power Association (APPA) is the service 
organization representing the interests of the more than 2,000 
municipal and other state and locally owned utilities throughout the 
United States. Collectively, public power utilities deliver electric 
energy to one of every seven U.S. electric consumers (about 35 million 
people) serving some of the nation's largest cities. The majority of 
APPA's member systems are located in small and medium-sized communities 
in every state except Hawaii. APPA member systems appreciate the 
opportunity to submit this statement in support of fiscal year 1999 
appropriations for the Low Income Home Energy Assistance Program 
(LIHEAP).
    We fully support the Administration's fiscal year 1999 budget 
request of $1.1 billion for LIHEAP. APPA also supports the request for 
$300 million in emergency funds in fiscal year 1999 and $1.1 billion in 
advanced funding for fiscal year 2000. Because the majority of LIHEAP 
monies are needed during a short period of time in the winter months, 
advanced funding for LIHEAP is critical in enabling states to 
effectively plan for and administer the program.
    Funding cuts since LIHEAP's last reauthorization have forced a 
tightening of eligibility standards and, in some cases, significant 
reductions in benefit levels. According to the National Energy 
Assistance Directors' Association (NEADA), the primary educational and 
policy organization for state LIHEAP directors, the number of 
recipients has been cut by over one million households during the 
recent past and average benefits have declined by about 10 percent. 
Prior to the dramatic reduction in LIHEAP funding in fiscal year 1995, 
the program was serving 20 percent of the eligible population, with 
one-half of the recipients being elderly or disabled Americans living 
on fixed incomes. Without the assistance provided by LIHEAP, many would 
be forced to choose between paying their home energy bill or purchasing 
other necessities of life, such as food.
    As the debate over restructuring of the electric utility industry 
and the issue of providing and funding ``public benefits'' programs 
continues, some in Congress have stated their belief that electric 
utilities should assume the entire burden of energy assistance for low 
income customers as a cost of doing business. As these restructuring 
efforts take place at both the federal and state levels, the risks 
become greater that bills for residential customers, especially those 
with low incomes, will increase if retail markets are opened to 
competition. The need for full funding of LIHEAP remains critical in 
ensuring that all those in need of energy assistance receive help. APPA 
believes that any public benefits programs should not replace or 
supersede existing programs, such as LIHEAP, that are funded by federal 
appropriations.
    As evidence of commitment to low income assistance, public power 
systems across the country support a variety of programs providing help 
to low and fixed income customers. A survey conducted by the National 
Fuel Funds Network (NFFN) shows that publicly-owned utilities raised 14 
to 26 cents more per customer than other utilities in their efforts to 
assist low income and needy customers in paying their bills. Many 
public power systems provide special rates for low income households 
and some have residential conservation and demand side management 
programs designed to reduce energy consumption.
    In addition, the impact of welfare reform on energy assistance is 
just beginning to be felt and LIHEAP is likely to play an important 
role in the transition. Persons who will be leaving the public 
assistance rolls likely will be entering lower paying jobs and still 
will be confronted with large energy bills. These families remain at 
risk.
    LIHEAP is one of the outstanding examples of a successful state-
operated program. The requirements imposed by the federal government 
are minimal and most important decisions are left to grantees.
    APPA urges this Subcommittee's favorable consideration of the 
Administration's fiscal year 1999 budget request for LIHEAP. Again, 
thank you for this opportunity to present our views.
                                 ______
                                 
  Prepared Statement of Deb Beck, President, Drug and Alcohol Service 
                 Providers Organization of Pennsylvania
    My name is Deb Beck and I serve as the President of the Drug and 
Alcohol Service Providers Organization of Pennsylvania (DASPOP). DASPOP 
is a coalition of drug and alcohol prevention and treatment 
practitioners, programs, and drug and alcohol associations organized 
for advocacy on behalf of individuals and families in need of drug and 
alcohol prevention, education, intervention and treatment. DASPOP 
represents more than 365 organizations, programs and clinics, 1,900 
certified addictions professionals, 1,200 student assistance 
professionals, and others throughout Pennsylvania.
    I am submitting this testimony on behalf of DASPOP, the National 
Coalition of State Alcohol and Drug Treatment and Prevention 
Associations, which is composed of 33 state-based associations of 
treatment and prevention providers in 29 states and the Legal Action 
Center, a non-profit law and policy firm that represents individuals in 
recovery from and struggling with alcohol and drug problems and AIDS. 
Through federal and other funds, the programs I represent provide 
services to addicted parents and pregnant women who want a better 
future for their children, addicted individuals in the criminal justice 
system who can move to a sober and crime free life, and millions of 
children and adults at risk for developing alcohol and drug problems.
    We appreciate last year's increases for alcohol and drug prevention 
and research programs and the Committee's refusal to cut funding for 
alcohol and drug treatment programs. Providing strong support for 
alcohol and drug treatment, prevention, and research is imperative to 
maintain and improve the health and well being of our Nation. These 
programs effectively decrease alcohol and drug use, crime, health care 
costs, AIDS, and welfare dependence.
Treatment and prevention needs in Pennsylvania and around the Nation
    Pennsylvania programs, such as Gaudenzia Inc. and the Diagnostic 
and Rehabilitation Center have been leaders in developing effective 
programs for women, youth, homeless individuals and other under served 
populations. However, according to a recent survey conducted by the 
National Association of State Alcohol and Drug Abuse Directors 
(NASADAD), on any given day in Pennsylvania there is a waiting list of 
1,400 individuals and families in need of treatment for alcoholism and 
drug dependence.
    Because of changes to welfare laws on both the state and federal 
levels, we are seeing increased demand for all levels of alcohol and 
drug prevention and treatment services supported by the Substance Abuse 
Prevention and Treatment Block Grant and we expect this trend to 
accelerate. Studies have demonstrated that 16-20 percent of the 
individuals on welfare have alcohol or drug problems. In Pennsylvania, 
an estimated 41,872 TANF (Temporary Assistance for Needy Families) 
recipients will be in need of addiction treatment. However, because of 
treatment capacity limitations due to public funding limits and 
obstacles created by some forms of managed care, many individuals will 
be unable to receive treatment during their period of welfare 
eligibility. It is imperative that sufficient treatment and prevention 
programs be available to help individuals and families move from 
welfare to work.
    Far too often, treatment is unavailable until the person is in need 
of intensive treatment or has entered the criminal justice system. In 
particular, residential treatment for women and children and for 
addicted adolescents is getting increasingly difficult to obtain. Lack 
of parity in private insurance coverage for alcohol and drug treatment 
and prevention services coupled with often ineffective and inaccessible 
consumer grievance procedures limit the ability of individuals and 
families to get help through private insurance and HMO coverage. This 
problem shifts individuals onto the public treatment system funded by 
the Substance Abuse Prevention and Treatment Block Grant.
Recommendations
    For providers to supply these essential services in Pennsylvania 
and throughout the nation, we need your support. We urge Congress to 
adopt the following increases in fiscal year 1999 funding for alcohol 
and drug treatment, prevention, and research programs in the Substance 
Abuse and Mental Health Services Administration (SAMHSA), Department of 
Education, and National Institutes of Health. These are wise 
investments that will provide desperately needed services in 
communities across the country:
  --$1.51 billion for the Substance Abuse Prevention and Treatment 
        Block Grant (an 11 percent increase over fiscal year 1998 
        appropriations, including the $50 million appropriated in the 
        ``Contract with America Advancement Act'' (Public Law 104-
        121)).
  --$180 million for the Center for Substance Abuse Treatment (CSAT) (a 
        15-percent increase over fiscal year 1998) and $180 million for 
        the Center for Substance Abuse Prevention (CSAP) (a 15-percent 
        increase over fiscal year 1998), which includes $10 million for 
        the High Risk Youth Grants program (a 66-percent increase over 
        fiscal year 1998). These allocations would fund Knowledge 
        Development and Application (KDA) activities and targeted 
        capacity expansion programs that increase treatment and 
        prevention services for high risk youth, ex-offenders, and 
        women and children on welfare.
  --$606 million for the Safe and Drug Free Schools and Communities Act 
        program (a 10-percent increase over fiscal year 1998).
  --$262.2 million for research at the National Institute on Alcohol 
        Abuse and Alcoholism (NIAAA) (a 15-percent increase over fiscal 
        year 1998) and $658.9 for research at the National Institute on 
        Drug Abuse (NIDA) (a 25-percent increase over fiscal year 
        1998).
Treatment and Prevention Reduce Alcohol and Drug Use, Have Public 
        Support
    Numerous studies have demonstrated the effectiveness of treatment 
and prevention in reducing alcohol and drug use. The most recent, the 
National Treatment Improvement Evaluation Study (NTIES), evaluated 
CSAT's demonstration programs and found sustained reductions in drug 
use. Drug use declined by 50.7 percent for crack, 55 percent for 
cocaine, 46.5 percent for heroin, and 50 percent for marijuana for the 
5,700 clients studied one year after completing treatment. NTIES also 
found a 77.6 percent decrease in violent crime, 18.7 percent increase 
in employment, and 10.7 percent decrease in welfare dependence. I have 
attached a copy of this study so that it may be included in the record.
    Prevention also has been shown to be effective in reducing use. A 
1997 NIDA study found that research-based prevention programs 
significantly reduce youth alcohol and drug use. A 1995 Cornell 
University study of 6,000 junior high students in New York State found 
that students who participate in school-based prevention programs are 
40 percent less likely to use alcohol and drugs than those who did not 
participate.
    Treatment has been repeatedly shown to be cost-effective. A 1994 
California study found that each $1 invested in substance abuse 
treatment and prevention saves taxpayers $7; a 1996 Oregon study 
determined the return to be $5.60 for every $1 invested.
    The public recognizes the value of treatment and prevention 
services. A 1995 Gallup poll found that 77 percent of Americans favored 
increased spending for alcohol and drug treatment services. Police have 
echoed the public's support for treatment. In a March, 1996 poll, 300 
police chiefs from around the country ranked drug abuse as the most 
serious problem in their communities--more serious than domestic 
violence, burglary and theft, or violent crime. Large-city police 
chiefs have repeatedly identified the shortage of treatment programs as 
the most serious limitation in their ability to address drug problems 
successfully.
The treatment gap in our communities is growing
    Access to alcohol and drug treatment does not meet the current need 
for services. Only 50 percent of the individuals who need treatment 
receive it.\1\ Waiting lists for alcohol and drug treatment are six 
months long in some regions.
---------------------------------------------------------------------------
    \1\ Woodward, A., Epstein, J., Gfroerer, J., Melnick, D., Thoreson, 
R., and Willson, D. ``The Drug Abuse Treatment Gap: Recent Estimates.'' 
Health Care Financing Review, Vol. 18, Number 3. Spring, 1997.
---------------------------------------------------------------------------
    Recent entitlement reforms will shrink existing alcohol and drug 
treatment and prevention services significantly at a time when more 
services will be required.
    Welfare reform has reduced treatment availability by making 
individuals convicted of drug felonies after August 22, 1996 ineligible 
for cash assistance or food stamps in many states. Residential 
treatment programs, particularly programs serving low-income women and 
children, have relied on the these funds to help support room and board 
costs of care. Without these funds, treatment availability will 
decrease. Welfare reform also requires states to move individuals from 
welfare to work within a given time period, or a state's federal 
welfare funding will be decreased. Several national studies have 
concluded that 16-20 percent of welfare recipients have alcohol and 
drug problems. This could translate into an additional 400,000-800,000 
adult welfare recipients needing treatment to move into recovery, off 
welfare, and into jobs.
    Loss of Supplemental Security Income (SSI) support for individuals 
with alcohol and drug problems also will increase the need for public 
treatment services. On January 1, 1997, an estimated 200,000 
individuals with alcohol and drug disabilities lost their SSI and 
Medicaid coverage. Less than 60,000 of these individuals have 
requalified for SSI and Medicaid under another disability. Methadone 
maintenance, residential, and outpatient programs have relied on 
Medicaid to provide treatment. These programs now face budget gaps 
which reduce treatment availability.
    In addition to the shortfalls created by these changes to SSI 
eligibility, the $50 million per year that Public Law 104-121 \2\ 
appropriated to the Substance Abuse Block Grant for alcohol and drug 
treatment services was only appropriated for fiscal years 97 and 98 and 
will not be available in fiscal year 1999. Therefore, in fiscal year 
1999 there is an additional $50 million shortfall in treatment funding.
---------------------------------------------------------------------------
    \2\ The ``Contract with America Advancement Act,'' which ended 
eligibility for Supplemental Security Income (SSI) for individuals with 
alcohol and drug disabilities alone.
---------------------------------------------------------------------------
Investment in prevention programs pays off: Further investment required
    The ``1997 Monitoring the Future Survey'' reported an encouraging 
result this year--after years of dramatic increases in illicit drug use 
among eighth graders, drug use remained stable for most drugs, and 
decreased slightly for marijuana and certain other substances among 
eighth graders from 1996-1997. Even more significant was the fact that 
for the first time since 1991, the 1997 survey indicated an increase in 
the percentage of eighth graders disapproving of occasional and regular 
use of various drugs, including marijuana, powder cocaine, and alcohol. 
Such shifts in attitudes among adolescents demonstrate the success of 
expanding prevention programs.
    In order to reduce the remaining high levels of alcohol and drug 
use among youth, further expansion of prevention programs must occur. 
Every adolescent should have access to alcohol and drug prevention 
services. Increased funding in fiscal year 1999 is needed to provide 
such necessary access to prevention services.
Drug and alcohol treatment, prevention, and research funding must be 
        expanded
    Substance Abuse Prevention and Treatment Block Grant--SAMHSA/
CSAT.--The majority of SAMHSA's funding for drug and alcohol treatment 
and prevention is sent directly to states through the Substance Abuse 
Block Grant. The Block Grant is the primary source of federal funding 
for alcohol and drug treatment and prevention services, accounting for 
more than one-third of public funding for these services nationwide.
    Programmatic changes in SAMHSA's categorical grant program, 
described below, have left the Block Grant as virtually the only source 
of federal funding for community-based treatment and prevention 
services in SAMHSA. In tandem with dramatic decreases in demonstration 
funding, these changes will translate into a significant loss of direct 
services funding over the next several years.
    To help meet the pressing and increasing need for alcohol and drug 
treatment and prevention services, we urge Congress to fund the Block 
Grant at $1.51 billion for an overall increase of $200 million over 
fiscal year 1998 funding.
SAMHSA/CSAT and CSAP--balancing the knowledge development and 
        application (KDA) program with the need to target services to 
        under served populations
    In fiscal year 1997, the Administration restructured CSAP and CSAT 
demonstrations into ``knowledge development and application'' (KDA) 
programs targeted at testing models of care in the community instead of 
increasing service capacity. Historically, these programs directly 
funded community-based services filling critical service gaps for, 
among others, pregnant women, women with children, people involved in 
the criminal justice system, the homeless, youth in high-risk 
environments, and community-based prevention partnerships. We are very 
concerned that these changes have translated into the loss of direct, 
community-based treatment and prevention services at a time of 
increasing need.
    We believe that funding at the Centers should be directed toward 
two major activities: the continuation of existing grants under the 
Knowledge Development and Application (KDA) Program and services 
capacity expansion for populations at high risk or which have increased 
need for treatment and prevention services. Targeting service funding 
to specific populations, such as high risk youth, offenders, and women 
and children on welfare, allows CSAP and CSAT to determine the most 
efficient and effective way to serve these populations at a time when 
treatment and prevention resources are at a premium. Indeed, the 
demonstration programs have been absolutely essential to our ability to 
test the effectiveness of services. Without them, for example, we would 
not have the outcome data I related earlier from NTIES about the 
effectiveness of federally funded treatment programs. Investment in the 
application of research findings is also a key Federal responsibility, 
and CSAP and CSAT, as the lead Federal agencies in prevention and 
treatment, are singularly equipped to translate research findings into 
innovative application programs.
    Despite studies demonstrating the efficacy of treatment and 
prevention services, funding for the Centers was dramatically reduced 
in fiscal year 1996. Currently CSAP is $87.5 million and CSAT is $52.4 
million below their fiscal year 1995 funding levels.
    For fiscal year 1999 we urge Congress to appropriate $180 million 
for CSAT and $180 million for CSAP, a $24 million increase for CSAT and 
a $29 million increase for CSAP over fiscal year 1998 funding. (CSAP's 
funding recommendation includes the recommendation of $10 million for 
the High Risk Youth Grant program).
Safe and Drug Free Schools and Communities Act--Department of Education
    Research has demonstrated that school-based prevention programs 
that focus on personal and refusal skills development can significantly 
reduce alcohol and drug use. This program also supports student 
assistance programs that intervene with students who are beginning to 
use alcohol and drugs and refer them to appropriate services. These 
early intervention programs, which have no other source of federal 
funding, are critical to reaching youth at high risk early.
    For fiscal year 1999 we urge Congress to appropriate $606 million 
for the Safe and Drug Free Schools and Communities Act program, a $50 
increase over fiscal year 1998.
Basic Research--NIH/NIAAA and NIDA
    Research into the causes, costs, and ``cures'' of alcoholism and 
drug dependence is an important component of our field's continuum. 
This past year NIDA scientists have observed biochemical changes in the 
brain stimulated by drug use with Positron Emission Topography (PET) 
and scientists at NIAAA have been making great strides in genetic 
research relative to alcoholism. These breakthroughs have demonstrated 
that alcoholism and drug dependence research hones our knowledge about 
addiction and improves our ability to treat and prevent it.
    We believe more resources are needed to ensure adequate research 
attention. We urge Congress to appropriate $262.2 million for NIAAA (a 
$35 million increase) and $658.9 million for NIDA (a $131.7 million 
increase).
Conclusion
    Alcoholism and drug dependence continue to be among our Nation's 
most serious and costly health problems. The programs I have discussed 
are the first line of defense to protect our children from developing 
drug and alcohol problems, as well as the funding source of last resort 
to treat Americans who have already developed these problems. As a 
society, we must keep these programs strong. Thank you.
                                 ______
                                 
          Prepared Statement of the National Kidney Foundation
    The National Kidney Foundation (NKF) is the nation's largest 
voluntary health organization devoted to the care of patients with 
kidney disease, as well as the prevention and cure of diseases of the 
kidney and urinary tract. The NKF consists of more than 30,000 lay and 
professional volunteer constituents. The NKF is a member of the Council 
of American Kidney Societies (CAKS), and we support the testimony that 
has or will be presented by the other members of that Council: the 
American Society of Nephrology, the American Society of Pediatric 
Nephrology, the American Society of Transplant Physicians and the Renal 
Physicians Association.
    The NKF is most appreciative of the significant support that the 
Committee has provided to the National Institutes of Health (NIH) 
during the last few years. We know that the members of the Committee 
have been faced with difficult funding decisions for many worthy 
programs, and we thank you for making the NIH a priority. We are 
particularly appreciative of the 7.5 percent increase that the 
Committee provided to the National Institute of Diabetes and Digestive 
and Kidney Diseases (NIDDK) for fiscal year 1998.
    We also wish to thank Congress for its expressed interest and past 
support of the problem of kidney disease caused by pain killers. The 
NIDDK has launched a new initiative to identify the prevalence of 
analgesic nephropathy in the United States, as recommended in the House 
Committee Report to the fiscal year 1998 appropriations bill. 
Similarly, the Committee's concern about the kidney complications of 
diabetes has resulted in an NIDDK Request for Applications concerning 
diabetic nephropathy. These are important initiatives which have been 
made possible by your support, and we are grateful for it.
    Resolutions have been introduced in the House and Senate in support 
of doubling the funding for NIH over five years. We are encouraged by 
this broad and growing support throughout Congress. We urge the 
appropriate Committees, including the House and Senate Budget 
Committees, to support this effort through the identification of 
additional resources beginning in fiscal year 1999. This additional 
funding is needed to maintain our country's lead in scientific 
investigation at a time when traditional sources for funding 
fundamental investigation and clinical research are diminishing and 
threatened to disappear. We would like to request a 15 percent increase 
in the appropriation for NIDDK. This commitment of additional resources 
is essential to continue the support of new opportunities for improving 
the health of Americans which biomedical research has provided and 
continues to offer today. To that end we would like to recommend to you 
some new research opportunities and challenges in the area of kidney 
disease and to solicit your support for them.
    Proteinuria.--There are 300,000 Americans with irreversible kidney 
failure or End-Stage Renal Disease (ESRD) who require dialysis or a 
transplant to survive. We estimate that there are ten times as many 
individuals who have detectable protein in the urine, which is an early 
indication of progressive kidney disease, well before the presence of 
any other clinical or laboratory evidence of the problem. These 
Americans should become the focus of new attention for intervention and 
prevention. It is these individuals, with early kidney disease 
manifested by proteinuria, who are more likely to progress to ESRD. 
More importantly, there is a much larger number of individuals who have 
proteinuria whose kidney disease will not progress to ESRD, but who are 
still at greater risk of heart attack and stroke than Americans without 
evidence of protein in the urine. How many? No one knows for sure right 
now because not enough work has been done in this important public 
health area. We estimate the number to be in the millions. 
Nevertheless, very few of these individuals are identified or receive 
the care and attention that could prevent their morbidity and premature 
mortality. We need to know more about the incidence and prevalence of 
proteinuria, as well as the efficacy of interventions which could 
address this public health problem. The NKF is strongly committed to 
that goal. We recommend that the Kidney Program of the NIDDK be 
encouraged and provided support to gather basic epidemiologic 
information on this high risk segment of the population and to explore 
the appropriate strategies for the early identification and treatment 
of those at risk.
    Nutrition.--Malnutrition is a common complication of chronic 
dialysis patients, occurring in about 40 percent of such individuals. 
Other than age, nutritional status is the most potent predictor of 
mortality in patients with ESRD. These poorly nourished patients are 
more susceptible to infection and are more likely to be hospitalized 
than other patients. Some of these patients are compromised 
nutritionally because of the poor appetite which often accompanies ESRD 
and because of the dietary constraints which they must follow. These 
factors are complicated by metabolic problems associated with kidney 
failure which are not fully understood. Without that understanding, we 
cannot comprehensively address the problem of malnutrition in ESRD 
patients. As a first step, we recommend that the NIDDK sponsor a 
demonstration project, in conjunction with the Health Care Financing 
Administration (HCFA), which would document the efficacy of the various 
interventions that are currently available in improving the nutritional 
status of ESRD patients, including that of intradialytic parenteral 
nutrition. We ask Congress at this point to endorse such an initiative 
by providing language directing HCFA and NIDDK to work with the health 
industry to develop a clinical trial that will investigate whether 
nutritional therapy of malnourished chronic dialysis patients will 
improve their health and survival.
    Transplantation.--According to the United Network for Organ Sharing 
(UNOS) 19,817 Americans received kidney transplants between April 1991 
and March 1993. As of April 1997, 2,588, or 13 percent, of these 
individuals experienced a rejection of their transplant and had to 
return to dialysis to await retransplantation. We need to find better 
ways to prevent kidney transplant rejection. The National Institute of 
Allergy and Infectious Diseases (NIAID) has taken the lead in this 
search. These efforts must be redoubled. There is a second, and perhaps 
greater, opportunity for transplant research. As of January 21, 1998, 
there were 38,387 Americans waiting for a kidney transplant. 
Unfortunately only 11,000 kidney transplants were performed last year. 
The gap between those who need a kidney transplant and the availability 
of human organs donated for transplantation continues to grow every 
day. The greatest challenge facing the transplant community is the 
scarcity of organs for transplantation. Currently, xenotransplantation 
(animal to human transplants) is the only process on the horizon which 
could meet the need for additional transplants. As we approach the 
millennium, it is time to foster efforts which could answer the 
question of whether xenotransplantation is a viable option to solve the 
problem of supply and demand in kidney transplantation. With additional 
funding, NIAID would be able to support investigation and seek 
solutions to this problem.
    Cardiovascular Disease.--Heart Disease and Arteriosclerosis are the 
leading causes of morbidity and mortality of patients with kidney 
disease during its progressive stage to ESRD, after the onset of ESRD 
while on dialysis, and after successful kidney transplantation. Without 
careful study of the accelerated course of cardiovascular complications 
in kidney disease, we cannot address this issue comprehensively or 
provide solutions to the leading cause of death of the hundreds of 
thousands of patients with kidney disease, those on dialysis and those 
who are transplanted. As a first step, the NIDDK and the National 
Heart, Lung, and Blood Institute (NHLBI) should be encouraged to 
support basic and clinical research in this high risk group to 
determine the role of the interventional measures that have been shown 
to be promising in the general population.
    Vascular access.--Access to the vasculature is necessary to provide 
hemodialysis to patients with ESRD. It is vital to maintain the 
functioning of grafts and fistulas as long as possible. Yet, occlusion 
and complications of vascular access, including infection, constitute 
the single largest cause of hospitalization of dialysis patients, and 
are a major contributor to the increase in the cost of the Medicare 
ESRD Program. Support is needed for research to develop new techniques 
for the early identification of access problems and of new ways to 
resolve them.
    We hope that our testimony has demonstrated the importance of 
research and its potential for preventing kidney disease and improving 
the lives of kidney patients. We would be pleased to provide any 
additional information that the Committee may wish.
                                 ______
                                 
  Prepared Statement of Katherine N. Clapp, President, Fraxa Research 
                               Foundation
    My name is Katherine N. Clapp. I am from West Newbury, 
Massachusetts. My husband, Dr. Michael Tranfaglia, and I have two 
children with Fragile X, the most common inherited cause of mental 
retardation. Most Fragile X children are limited to an I.Q. of 20 to 60 
and require a lifetime of special care, at an average cost of over two 
million dollars per person. The emotional cost to affected families is 
incalculable. Like cystic fibrosis and muscular dystrophy, Fragile X is 
caused by a single gene and will someday be curable. Yet public funding 
for Fragile X research is strikingly low, in spite of its high 
prevalence and cost.
    In 1994, my husband and I joined with other Fragile X parents to 
form FRAXA Research Foundation, to fund research in universities around 
the country. The first year we raised $39,000, enough to partially fund 
two postdoctoral fellowships. Four years later FRAXA has 20 chapters, 
2000 contributors, and, in 1997, raised over $500,000 for research. We 
are currently funding 9 grants--all without a single government dollar. 
This growth was possible only because of the ground swell of support we 
received from families around the country affected by Fragile X.
    I am here to make two suggestions about what the Congress can and 
should do to help over 90,000 Americans with Fragile X:
  --Fragile X research is vastly underfunded (see Attachment No. 1). 
        Present funding levels by the National Institute of Child 
        Health and Human Development (NICHD) are woefully inadequate in 
        light of this disease's prevalence in the population, the 
        potential for the development of a cure, and the significance 
        that Fragile X research has for related disorders such as 
        autism. Congress should move quickly to correct this deficit. A 
        modest investment made now will pay off handsomely, in terms of 
        dollars saved and reduced human suffering (see Attachment No. 
        2).
  --Newborns can be given a simple, inexpensive, and accurate DNA test 
        for Fragile X (along with, and using the same blood spot as, 
        the now-routine PKU test). This permits early diagnosis and 
        intervention. Congress should provide funding to The Centers 
        For Disease Control (CDC) and the Health Resources and Services 
        Administration (HRSA) to develop and implement a nationwide 
        newborn testing program (see Attachment No. 3).
Prevalence
    Fragile X--sometimes called Fragile X ``Syndrome'' although its 
occurrence is now clearly definable by DNA testing--affects one in 
every 2,000 males and one in every 4,000 females. One in 400 women 
carries this disease--even though most of these carriers have never 
heard of it.
    Most studies estimate that 80 to 90 percent of affected individuals 
remain undiagnosed. In part, this is because:
  --It is relatively newly-discovered.
  --DNA testing is even more recently discovered.
  --Diagnosis is often difficult during the first few years of life.
Potential for Treatment
    Researchers discovered the Fragile X gene on the X chromosome in 
1991. In individuals with Fragile X, this gene fails to produce a 
single protein needed in the brain, which often leads to mental 
retardation, behavior challenges such as aggression and anxiety, and 
seizures. Current research is unveiling the function of this protein 
and how it is involved in learning and memory. Other ongoing research 
is exploring ways to replace or compensate for the protein or to find 
medications that can ameliorate symptoms. Fragile X research is of 
critical importance for several reasons:
  --It will lead to an effective treatment or cure for Fragile X.
  --It is likely to lead to understanding and treatment of many cases 
        of autism, since about 10 percent of autistic individuals have 
        Fragile X. Fragile X is unique among the autism-spectrum and 
        developmental disorders because its cause is known, which makes 
        it an excellent research model for these disorders.
  --It will shed light on human intelligence and learning in general 
        since Fragile X is the only single-gene disease known to 
        directly impact human intelligence.
    Last year NICHD spent about 2 million dollars on Fragile X 
research, just 4 times the amount our tiny foundation raised for 
research. Only when the Congress and the NICHD expand and accelerate 
this research will the exciting projects on the drawing board reach the 
laboratories. Your Committee should help the NICHD to expand its 
Fragile X research.
Newborn Screening
    Newborn screening of all children can be carried out by means of a 
simple blood test. Presently, every newborn donates a drop of blood for 
PKU and other tests. Each state has its own program, generally assisted 
by the Health Resources and Services Administration of the Department 
of Health and Human Services under Title V of the Social Security Act. 
Testing for Fragile X should be offered to new parents, along with 
current tests and using the same drop of blood. Dr. Roger Stevenson of 
the Greenville Genetic Center of Greenville, South Carolina--the Mayo 
Clinic of Genetics--estimates that adding this test would cost only 
about $5 per child. This small price would spare Fragile X families the 
torments of uncertainty and mistaken diagnoses that commonly mark the 
early childhood years. It would provide families the information they 
need for future family planning, and it would enable them to seek early 
interventions--educational and medical--that have been shown to improve 
lives dramatically. The Centers for Disease Control in cooperation with 
the Health Resources and Services Administration will need funds to 
develop and implement this program for the states. Please fund such 
testing.
Conclusion
    Given its prevalence, I am sure you agree that research on Fragile 
X is underfunded. No one ever dies of Fragile X; life span is normal. 
But the hopes and dreams of Fragile X parents do die. These children 
lose the chance to lead normal, productive lives, and their basic needs 
and sustenance often become the responsibility of American taxpayers. 
Children born with Fragile X lack only one vital protein. We need your 
help to support the research that will show us how to replace or 
compensate for this protein and enable people with Fragile X to live 
normal, productive lives. Only major research can make this happen. My 
children, Andy and Laura, and thousands of other precious children 
deserve the chance this research will provide, and I hope you will make 
it happen as a priority by funding NICHD, CDC, and HRSA Fragile X 
programs.
    Thank you.
    I enclose ``Brain Briefings'', a 1998 Society for Neuroscience 
publication on Fragile X.

                                                ATTACHMENT NO. 1
----------------------------------------------------------------------------------------------------------------
                                                           U.S.                                           Per
            Genetic disease               Incidence   population \1\      NIH research     Amount \2\    person
----------------------------------------------------------------------------------------------------------------
Down Syndrome..........................      1/1,000       275,000                  1996         16.7         61
                                                                                    1997         17.0         62
                                                                             1998 (est.)         18.0         65
                                                                         1999 (est.) \3\         19.0         69
Batten's disease.......................    1/100,000         2,750                  1996          3.0      1,090
                                                                                    1997          3.0      1,090
                                                                             1998 (est.)          3.0      1,090
                                                                             1999 (est.)          4.0      1,455
Duchenne's Muscular Dystrophy..........      1/1,000       275,000                  1996         10.8         39
                                               males                                1997         14.0         51
                                                                             1998 (est.)         14.0         51
                                                                             1999 (est.)         16.0         58
Fragile X..............................  \4\ 1/3,000        91,666                  1996          1.8         20
                                                                                    1997          2.0         22
                                                                                  1998NA                      NA
                                                                                  1999NA                      NA
----------------------------------------------------------------------------------------------------------------
\1\ Based on a U.S. population of 275 million.
\2\ Millions of dollars. Figures obtained from NIH Budget Office for Down syndrome, cystic fibrosis, Batten's
  disease, and Duchenne's muscular dystrophy. The Office did not have figures for Fragile X, because the amounts
  were too small.
\3\ Based on President's projected budget.
\4\ 1 in 2,000 males; 1 in 4,000 females.

                            Attachment No. 2
    recommendations for nichd fragile x research funding priorities
    We urge the Committee to incorporate the following language in its 
report:
    Fragile X.--The Committee commends the NICHD for its continuing 
support for Fragile X research, and includes funds necessary for the 
Institute to further expand and strengthen its research activities on 
this disorder. Fragile X is the most common inherited cause of mental 
retardation. It is unique among autism-spectrum and developmental 
disorders because NICHD-funded research has identified the cause: the 
failure of a single gene to produce a specific protein. Although the 
protein can be produced synthetically, no cure or effective specific 
treatment has been found. The Committee urges the Institute to increase 
its efforts to find a cure for Fragile X, and to expand our 
understanding of the role of the Fragile X protein in brain function. 
The Committee is pleased that the NICHD is co-sponsoring with the FRAXA 
Foundation an international Fragile X conference planned for December 
of this year. The Committee looks forward to receiving a report on the 
recommendations and goals set at the conference. An important portion 
of the conference will address increased research efforts to develop 
effective treatments for individuals with Fragile X, including testing 
of existing medications and development of new psychopharmacologic 
medications that are safe and effective. The Committee also is pleased 
that NICHD has added Fragile X patients to its expanded program of 
autism research, and urges the Institute to include Fragile X patients 
in the pediatric psychopharmacology clinical trials being conducted by 
autism investigators as another effort to develop safe and effective 
medications for individuals with Fragile X.
                            Attachment No. 3
             recommendations for fragile x newborn testing
Public Health Needs
    Newborn screening to identify at birth underlying conditions which 
can cause or contribute to disease, disabilities, and death represents 
a tremendous unmet opportunity for preventing morbidity, disability and 
mortality. Currently, newborn screening programs for phenylketonuria 
(PKU), sickle cell anemia, and hypothyroidism have demonstrated the 
benefits of early intervention in preventing the consequences of these 
diseases. Nutritional intervention early in life prevents mental 
retardation in children with PKU, the use of penicillin prophylaxis 
prevents severe bacterial infections in children with sickle cell 
disease, and hormone replacement prevents mental retardation in 
children with hypothyroidism.
    In light of advances resulting from the Human Genome Project and 
related research, it is now possible to extend newborn screening 
programs to a wide range of conditions, including Fragile X. As more 
and more disease genes are identified, the need for a systematic 
approach to newborn testing becomes increasingly apparent. Public 
health policy leadership is needed to meet these new challenges. This 
will require a concerted effort among national and state public health 
agencies.
    We urge Congress to provide $20 million for the Centers for Disease 
Control (CDC) and the Health Resources and Services Agency (HRSA), in 
order to develop and implement a strategy for evaluating and expanding 
newborn screening programs, including Fragile X. Together, CDC and HRSA 
can evaluate scientific and programmatic developments, translate this 
knowledge into public health program guidance, and develop 
recommendations to states for strengthening newborn screening programs.
    In particular, CDC would:
  --Hold public and professional discussions on the needs, strategies 
        and benefits of newborn testing, early intervention, and 
        treatment
  --Evaluate public health policy and strategies for newborn testing 
        programs, and perform public health research to develop 
        recommendations for strengthening and expanding effective 
        approaches
  --Assess and develop methods for applying and evaluating new 
        laboratory tests in newborn public health testing programs
  --Establish and evaluate the effectiveness and safety of pilot 
        demonstration projects
  --Provide technical, laboratory, and evaluation assistance to states 
        for implementation of newborn screening recommendations.
    HRSA would:
  --Provide technical assistance and evaluation to states to develop 
        systems coordination for access to a ``medical home'' for 
        families identified
  --Facilitate the development of systems of retrieval of those 
        identified by the newborn testing for genetic counseling, 
        follow-up and medical treatment
  --Establish a system to evaluation patient satisfaction of the pilot 
        programs.
                                 ______
                                 
       Prepared Statement of the American College of Rheumatology
    The American College of Rheumatology (ACR) is an organization of 
physicians, health professionals, and scientists that serves its 
members through programs of education, research and advocacy that 
foster excellence in the care of people with arthritis and rheumatic 
and musculoskeletal diseases. The ACR is pleased to provide written 
testimony to the Senate Appropriations Subcommittee on Labor, Health, 
and Human Services regarding the Medicare Physician Practice Expense 
Regulations. The College's testimony will refer to the findings and 
recommendations of a report on physician practice expense by the 
General Accounting Office (GAO), and to recommendations that the 
Medicare Payment Advisory Commission (MEDPAC) made in its March 1 
report to Congress.
GAO Report on HCFA's RBPE Implementation Methodology
    ACR has had the opportunity to review the final GAO report on 
HCFA's methods for revising physician practice expense payments, and we 
commend the GAO for accomplishing this significant task within a 
relatively tight timeline. Furthermore, we concur with the vast 
majority of the report's findings. The College's testimony will focus 
on the following aspects of the GAO report: (1) HCFA's methodology for 
developing direct cost estimates; (2) Linking; and (3) Use of physician 
nurses in the hospital setting.
    HCFA's Methodology for Developing Direct Cost Estimates.--The GAO 
report states that ``HCFA used an acceptable method to develop direct 
cost estimates.'' The ACR fully concurs with this assessment. ACR 
believes that the Clinical Practice Expert Panel (CPEP) methodology 
utilized to generate data on direct practice costs was an open and 
inclusive process that resulted in values that will serve as an 
effective starting point for developing appropriate practice expense 
RVUs. We reject the opinion of many stakeholders that the data is 
fundamentally ``flawed''. The intent of the CPEP process itself was to 
develop a body of data using a multidisciplinary, representative sample 
of physicians and other experts (nominated by specialty societies) with 
expertise regarding the practice expenses under their review. Every 
opportunity was provided for all affected parties to provide input. By 
the time the official transition to resource-based practice expenses 
begins in May, 1998 with the release of the proposed rule on the 1999 
Medicare Fee Schedule, physicians and other interested parties will 
have been given over ten formally promulgated opportunities to provide 
input into this process. In fact, physicians themselves will have 
actively participated in the actual development of RBPEs through every 
stage of the process, including participation in the original CPEPs, in 
the validation panels conducted in October, 1997, and the 
multispecialty panel meeting convened in December. HCFA has also 
provided a variety of other forums for physician groups to convey their 
opinions to the agency. For these reasons, we believe that the agency's 
actions to date--and the plans for future opportunities to submit 
views--already fully meets Congressionally mandated requirements in the 
Balanced Budget Act of 1997 that HCFA ``consult with organizations 
representing physicians regarding data and methodology to be used.''
    We also fully concur with the passage in the report indicating that 
``Other methods for estimating direct expenses have limitations.'' The 
College agrees that the expense of alternative approaches such as mail 
or on-site surveys (both in time and actual cost) makes them, by 
definition, prohibitive. Additionally, these types of data gathering 
efforts are invariably plagued by low response rates, as noted in GAO's 
report, and are often hampered by design bias and potentially even by 
gaming. The report's stated concerns that activity-based or cost-based 
accounting do not provide the specificity needed to adjust the Medicare 
fee schedule, are also shared by ACR.
    It has come to the attention of the College that the coalition of 
procedurally-oriented groups has suggested that HCFA's current approach 
be replaced by a cost-accounting based methodology generated by a 
``public-private partnership'' of HCFA and the medical specialty 
society community. The ACR finds such a proposal problematic in several 
ways. First, we believe that such an approach would result in a top-
down RVS that would mirror the inequities in the current charge-based 
system--i.e., those services that are now reimbursed more for their 
practice expenses because of Medicare's charge-based system would still 
get more; those services that are reimbursed less would still get less. 
This is because the American Medical Association's Socioeconomic 
Monitoring Survey (SMS) data, on which the proposal would be based, 
itself is distorted by the current charge-based RVUs. HCFA's approach 
is a bottom up approach--figure out the resources that are required to 
perform each service, and then convert them into a relative value 
system (RVS), resulting in the Congressionally mandated resource-based 
relative value system.
    The College also believes that HCFA has been engaging the 
professional medical community in a ``public-private partnership'' on 
RBPEs all along, as evidenced by the preponderance of opportunities for 
input afforded to the specialty societies. Finally, it is our opinion 
that use of a cost-accounting approach would merely maintain the status 
quo where procedurally-oriented services are over-reimbursed at the 
expense of evaluation and management services.
    Linking.--ACR believes that the issue of whether to utilize the 
redundant CPT codes reviewed by the CPEPs to link the direct cost 
estimates generated by the separate CPEPs remains fundamental to the 
development of accurate resource-based practice expenses. The College 
concurs with HCFA's assertion in last June's proposed rule that the 
relative relationships within CPEPs are correct, but the relationships 
between CPEPs need to be normalized to bring the relative estimates to 
a single scale. Accordingly, ACR agrees with the GAO report that the 
CPEP estimates need adjustment and that linking is desirable. In the 
absence of such linking, the proposed RBPE RVU system would not truly 
contain ``relative'' values.
    GAO's report does raise questions regarding the specific linking 
formula utilized by HCFA, primarily regarding anomalies caused by the 
formula and the redundant CPT codes used to develop the links. While we 
believe that HCFA should remain open to the possibility of revising its 
linking methodology if credible alternate approaches are identified 
that can develop appropriate practice expense values, we reject the 
notion that the proposed linking methodology must be overhauled, 
reconstructed or abandoned. We therefore concur with the opinion of the 
Physician Payment Review Commission (PPRC) staff cited in the report 
that it is not necessary for HCFA to select new redundant codes, 
assemble new CPEPs, and estimate the linking regression on new data. It 
is our firm belief that the overall validity of the practice expense 
RVUs is dependent on HCFA adopting policies and rules to establish an 
appropriate relativity between the staff time estimates by the varying 
CPEPs. Therefore, while the College is not wedded to the specific 
linking model currently outlined by HCFA, we agree with the GAO report 
in the strongest possible terms that the CPEP estimates need some type 
of adjustment, and we believe a linking methodology is an appropriate 
approach.
    Use of Physician Nurses in the Hospital Setting.--The GAO report 
concluded that ``HCFA appropriately disallowed nearly all expenses 
related to staff that accompany physicians to the hospital since there 
is no available evidence that these expenses are not already being 
reimbursed or are a common practice.'' Some surgical groups have argued 
that surgeons often bring their nurses into the hospital and that these 
costs should be reimbursed by HCFA. GAO staff has been told by surgical 
groups that new evidence had been given to HCFA in response to the 
October rule-making notice that supports the claim that this is a 
widespread practice. GAO staff has said that it planned to examine the 
evidence and determine if it should modify its conclusion. ACR 
recommends that the GAO ask HCFA to independently validate any such 
evidence, to determine if it is the usual practice for a typical 
Medicare patient, before agreeing that such expenses should be allowed.
MEDPAC Report on Medicare Payment Policies
    MEDPAC has recommended that HCFA not adopt its proposal to reduce 
payments for procedures provided in conjunction with an office visit or 
other E/M service without further study. The ACR strongly agrees with 
this recommendation. It is the opinion of the ACR that extending the 50 
percent discount for multiple procedures to non-surgical services would 
be highly inappropriate, at best. We believe that using reductions for 
multiple surgical procedures performed through a single incision as a 
template for reducing multiple diagnostic procedures performed during 
an office visit or other E/M services is simply illogical. In these 
situations, the only savings in physician work or practice expenses 
that could be realized is a minor reduction in the administrative time 
associated with scheduling another appointment or pulling a chart, 
which is to say the savings in practice costs would be neglible. In 
light of the lack of data provided to support making such a dramatic 
change in reimbursement for services rendered during an E/M visit, we 
strongly urge HCFA to at least pilot-test the effects of such a 
proposal before implementation.
    We also concur with the MEDPAC recommendation that a volume and 
intensity adjustment, or behavioral offset, should not be used. In its 
June 18, 1997 propose rule, HCFA stated that it intended to assume that 
50 percent of the reductions in payments for specific procedures will 
be offset by an increase in volume and intensity. The effect of this 
assumption is to increase the amount of reductions for some procedures, 
and reduce the expected gain from others. The College agrees with 
MEDPAC's view that HCFA's experience with implementation of the RBRVS 
does not support the need for such a volume and intensity adjustment. 
Further, MEDPAC correctly that the sustainable growth rate for 
physician services, also mandated by the BBA, already corrects for any 
increase in the volume and intensity of physician services. ACR 
strongly urges Congress to advise HCFA that application of a volume and 
intensity offset to the PE-RVUs is inconsistent with requirement that 
resource-based practice expenses be implemented in a budget neutral 
manner.
Conclusion
    The ACR concurs with virtually all of the findings outlined in the 
GAO report. We believe that HCFA did utilize an acceptable method to 
develop direct cost estimates, and that while the specific proposed 
formula for linking the estimates is not perfect, some sort of linking 
or normalization is desirable. As was indicated by PPRC staff in the 
GAO report, drastic overhaul of the process, or implementation of an 
alternative approach, is not necessary. ACR agrees with the GAO that 
HCFA was correct in disallowing the costs associated with nurses who 
accompany a surgeon into the hospital, without independently verifiable 
data that this is a typical practice. The College also concurs with the 
recommendations relating to practice expense made by MEDPAC. We believe 
that it would be highly premature for HCFA to proceed with its 
recommendation to reduce payments for procedures provided in 
conjunction with an office visit or other E/M service without further 
study. We also agree that history does not support the need for a 
volume and intensity adjustment, and that the institution of the 
sustainable growth rate system makes this adjustment unnecessary.
                                 ______
                                 
  Prepared Statement of the National Association for State Community 
                           Services Programs
    The National Association for State Community Services Programs 
(NASCSP) thanks this committee for its continued support of the CSBG 
and seeks an appropriation of $505 million for the state grant portion 
of the Community Services Block Grant (CSBG). The amount appropriated 
for the state grant portion in fiscal year 1998 is $491 million. 
NASCSP's request includes an increase only for inflation. Funding for 
the CSBG block grant to the states and other programs funded under the 
CSBG for fiscal year 1998 was $542 million. The President's budget 
request for fiscal year 1999 is $491 million. This amount is for the 
block grant to the states and does not include the discretionary 
programs generally included in the full block grant.
    For the past two years language has been added to the Labor HHS 
Appropriations bill that addresses the use of carry-over funds at the 
local level. The language restricts the ability of the states to 
administer the CSBG and NASCSP therefore asks that it not be included 
in the fiscal year 1999 appropriations bill.
    NASCSP is the national association that represents state 
administrators of the Community Services Block Grant (CSBG), and state 
directors of the Department of Energy's low-income Weatherization 
Assistance Program.
Background
    The Community Service Block Grant was created as part of the 
Omnibus Budget and Reconciliation Act of 1981, during the Reagan 
Administration. The CSBG is a unique block grant that has successfully 
devolved decision making to the local level. Federally funded with 
oversight at the state level, the CSBG has maintained a local network 
of over 1,100 agencies with $5 billion in federal, state, local and 
private resources. Operating in almost every county in this country and 
serving over 11 million low-income persons, local agencies, known as 
Community Action Agencies (CAAs), provide services based on the 
characteristics of poverty in their communities. For one town this 
might mean securing jobs, for another developing affordable housing and 
in rural areas it might mean providing access to health services or 
developing a rural transportation system.
    Since its inception, the CSBG has shown how a partnership between 
states and local agencies can work to the greater benefit of citizens 
in each state. We believe it should be looked to as a model of how the 
federal government can best support self-sufficiency for low-income 
persons in a decentralized, non-bureaucratic and accountable way.
    Long before the creation of the Temporary Assistance for Needy 
Families (TANF) block grant, the CSBG was setting the standard for 
private-public partnerships that could work to the betterment of local 
communities and low-income residents. Family oriented while promoting 
economic development and individual self-sufficiency, the CSBG relies 
on an existing and experienced community-based service delivery system 
of CAAs and other non-profit organizations to produce results for its 
clients.
Major Characteristics of the Community Services Network
    Adaptability.--CAAs provide a flexible local presence that 
governors have mobilized to deal with emerging poverty issues, i.e., 
CAAs have demonstrated success in moving persons from welfare to work 
and in developing self-sufficiency among low-income persons.
    Leveraging Capacity.--For every CSBG dollar they receive, CAAs 
leverage over $4 in non-federal resources (state, local, and private) 
to coordinate efforts that improve the self-sufficiency of low-income 
persons and lead to the development of thriving communities. In some 
states that number is even higher. For instance in 1997 in New 
Hampshire, the CAAs leveraged $11 in non-federal resources for every 
CSBG dollar they received.
    Volunteer Mobilization.--CAAs mobilize volunteers in large numbers. 
In fiscal year 1995, the most recent year for which national data are 
available, the CAAs elicited nearly 25 million hours of volunteer 
efforts, the equivalent of 12,250 full-time employees. Using the 
minimum wage, these volunteer hours are valued at more than $100 
million.
    Emergency Response.--CAAs are utilized by federal and state 
emergency personnel as a front line resource to deal with emergency 
situations such as floods, hurricanes and economic downturns. They are 
relied on by families in their community to deal with local hardships, 
such as a house fire.
    Locally Directed.--CAAs are guided by tri-partite boards of 
directors. These boards consist of one third-elected officials, one-
third low-income persons and one-third representatives from the private 
sector. The boards are responsible for establishing policy and 
approving business plans of the local agencies. Since these boards 
represent a cross section of the local community, they guarantee that 
CAAs will be responsive to the needs of the community.
    The statutory goal of the CSBG is to ameliorate the effects of 
poverty while at the same time working within the community to 
eliminate the causes of poverty. The primary goal of every CAA is self-
sufficiency for its clients. This is a long-term activity that requires 
multiple resources. This is why the partnership of federal, state, 
local and private enterprise has been so vital to the successes of the 
CAAs.
What do Local CSBG Agencies Provide?
    Since Community Action Agencies operate in rural areas as well as 
in urban areas, it is difficult to describe a typical Community Action 
Agency. But, one thing that is common to all is the goal of self-
sufficiency for all of their clients. This may mean providing daycare 
for a struggling single mother as she completes her General Equivalency 
Diploma (GED), moves through a community college course and finally is 
on her own supporting her family without federal assistance. It may 
mean assisting a substance abuser as he seeks employment. Many of the 
Community Action Agencies' clients are persons who are experiencing a 
one-time emergency, others have lives of chaos engendered by many 
overlapping forces--a divorce, sudden death of a wage earner, illness, 
lack of a high school education, closing of a local factory or (as was 
the case in the Midwest in the eighties) the loss of family farms.
    CAAs provide access to a variety of opportunities for their 
clients. Although they are not identical, most will provide some if not 
all of the services listed below; employment and training programs; 
micro business development help for low-income entrepreneurs; a variety 
of crisis and emergency safety net services; local community and 
economic development projects; housing and weatherization services; 
Head Start; nutrition programs; family development programs.
    CSBG funds many of these services directly. Even more importantly, 
CSBG is the core funding which holds together a local delivery system 
able to respond effectively and efficiently, without a lot of red tape, 
to the needs of individual low-income households as well as to broader 
community needs. Without the CSBG, local agencies would not have the 
capacity to work in their communities developing local funding, private 
donations and volunteer services and running programs of far greater 
size and value than the actual CSBG dollars they receive.
    CAAs manage a host of federal, state and local programs which 
provide a one-stop location for persons whose problems are usually 
multi-faceted. CAAs manage the Head Start program. Using their unique 
position in the community, CAAs recruit additional volunteers, bring in 
local school department personnel, tap into religious groups for 
additional help, coordinate child care and bring needed health care 
services to Head Start Centers. They also manage the Low Income Home 
Energy Assistance Program (LIHEAP), raising additional funds from 
utilities for this vital program. They administer the Weatherization 
Assistance Program (WAP) and are able to mobilize funds for repair work 
on residences that keeps a number of elderly low-income owners in their 
homes. CAAs coordinate the WAP with the Community Development Block 
Grant program. This stretches federal dollars thus providing a greater 
return for individual tax dollars. They also administer the Women, 
Infants and Children (WIC) program as well as job training programs, 
substance abuse programs, transportation programs, domestic violence 
and homeless shelters, food pantries and gardening and canning 
programs.
Whom does the CSBG Serve?
    National data compiled by NASCSP show that the CSBG serves a broad 
segment of low-income persons, particularly those that are not being 
reached by other programs and are not being served by welfare programs.
      --74 percent have incomes at or below the poverty level; 48 
percent have incomes below 75 percent of the poverty guidelines. In 
1995 the poverty level for a family of three was $12,590.
      --33 percent of adults served have not finished high school.
      --34 percent of all client families were ``working poor'' and 
have wages or unemployment benefits as income.
      --18 percent depend on pensions and Social Security and are 
therefore poor, former workers.
      --25 percent receive welfare benefits.
      --61 percent of households served have children.
    During the past two years, many states have been scrambling to deal 
with the new Temporary Assistance for Needy Families (TANF). The CAAs 
and their state offices have been working to assist in an easy 
transition from Aid to Families with Dependent Children (AFDC) to TANF.
    In Washington state, all of the Community Action Agencies (31) have 
established or are about to establish agreements with regional state 
public assistance agencies to work with TANF clients who have been 
referred to community action for services. The agencies programs are 
being designed to fill gaps in the community such as transportation, 
small business development and the creation of job training sites. In 
Missouri, the Community Action Agencies have three representatives on 
the Governor's Welfare Reform Committee. This committee is an advisory 
group for the Department of Social Services. In Iowa, the Community 
Action Agencies provide intensive family development and self-
sufficiency services to families referred to them from Welfare-to-Work 
offices. The families most often referred are those who require 
comprehensive assistance.
    In New Hampshire CSBG funds are being used for alcohol and drug 
rehabilitation programs for welfare recipients to assist them in 
staying drug free and in securing and keeping jobs.
    In New York, CSBG funds are being used for family and community 
development specialists for TANF.
    In Wisconsin, 25 percent of the local agencies have applied for 
designation as the administering agency in their services area for the 
Wisconsin Works program. The other agencies will continue to provide 
supportive services such as child care, transportation and training. To 
recapitulate: The CSBG provides a community-based service delivery 
system. Each local organization, through its local board of directors, 
establishes priorities and serves its community and low-income 
residents through programs designed and delivered locally in 
partnership with state and local governments, businesses, civic and 
religious groups and others. The CSBG leverages resources that are far 
in excess of the appropriations it receives. As noted above, the CSBG 
generates $4 in non-federal funds for every CSBG dollar that is 
appropriated. Additionally, nearly 25 million hours of volunteer 
services were contributed to CAAs in 1995. CSBG agencies have used the 
increased funds they received for the last two years to continue their 
activities that lead to self-sufficiency and have become integrally 
involved in the implementation of TANF in most states across the 
nation.
    NASCSP therefore urges this committee to provide an increase that 
factors in inflation and to fund the CSBG grant to the states at $505 
million.
                                 ______
                                 
     Prepared Statement of the American Association of Health Plans
I. Introduction
    The American Association of Health Plans (AAHP) appreciates this 
opportunity to comment on the Health Care Financing Administration's 
fiscal year 1999 budget request. The Balanced Budget Act of 1997 (BBA) 
authorizes the Health Care Financing Administration (HCFA) to charge 
each Medicare+Choice organization and Medicare risk contractor a fee 
equal to the organization's pro rata share of HCFA's estimated costs of 
enrollment and information dissemination activities. Congress 
appropriated $95 million for these activities in 1998 and suggested 
that HCFA focus first on developing and publishing the comparative 
information booklet. On December 2, 1997, HCFA announced its intent to 
assess all Medicare risk contractors a fee equal to 0.428 percent of 
their monthly Medicare payments beginning in January and continuing 
through September 1998 until it collects the fiscal year 1998 
assessment of $95 million. The BBA authorizes HCFA to collect up to 
$150 million in fiscal year 1999 for its beneficiary education campaign 
subject to the appropriations process.
    In addition, the President's budget calls for a series of new user 
fees to generate an additional $660 million. According to budget 
documents, funds collected through the user fees would enable HCFA to 
meet the new workload demands imposed by the Health Insurance 
Portability and Accountability Act and the BBA. Included in these 
additional user fees is $37 million from Medicare+Choice organizations 
for costs associated with reviewing initial applications and contract 
renewals.
    The information fee and the new user fees proposed in its fiscal 
year 1999 budget will jeopardize some of the additional benefits 
enjoyed by beneficiaries enrolled in the Medicare HMO program--benefits 
which for many enrollees have made the Medicare HMO program more 
attractive than the traditional Medicare fee-for-service program. AAHP 
believes that health plans and their enrollees should bear a share of 
the cost of HCFA's education and information dissemination campaign 
that is consistent with the proportion of total beneficiaries enrolled 
in the Medicare HMO program, as opposed to the current user fee 
structure which requires health plans to bear the entire cost.
II. Importance of Beneficiary Education Activities
    AAHP supports efforts to ensure that beneficiaries receive 
information that will enable them to make informed decisions about 
coverage options. AAHP and its member plans are looking forward to 
working with the Health Care Financing Administration, beneficiary 
groups and others as the beneficiary education and information 
dissemination campaign moves forward. The central goal of this 
initiative, to provide more and better information to beneficiaries 
about all of the options available to them, is critical to permitting 
beneficiaries to take advantage of the expanded range of choices 
envisioned under the new Medicare+Choice program. As health plans 
participating in the Medicare program today know well, there are 
significant challenges in reaching out to Medicare beneficiaries and 
ensuring that the information they receive is useful and 
understandable. AAHP's member plans have a great deal of experience in 
communicating with beneficiaries and are constantly working to refine 
and improve our outreach and communications efforts.
    The most important aspect of our efforts is to listen to Medicare 
beneficiaries and be responsive to the information needs they identify. 
Information must be provided when, where and in a form in which it will 
be most accessible and useful to beneficiaries as they consider the 
differing options available to them under the Medicare+Choice program. 
Only an active and intensive dialogue between all parties involved in 
the beneficiary education and information campaign will allow HCFA to 
meet this challenge. HCFA has already initiated this dialogue and we 
appreciate their efforts. We are committed to playing an active part in 
this process and urge heavy reliance on beneficiary focus groups and 
other mechanisms for ensuring at each step of the campaign's 
development that it will produce information that beneficiaries can 
readily use.
III. User Fees Are a Tax on Health Plans and Will Hurt Beneficiaries
    AAHP is concerned that the fiscal year 1998 user fee represents 
more than 20 percent of the 2 percent minimum payment update received 
in the vast majority of counties in 1998. HCFA's additional proposed 
user fees were not anticipated when Congress developed the payment 
methodology under the BBA. In addition, growth in spending for the 
Medicare+Choice program is lower than had been anticipated when 
Congress enacted the Balanced Budget Act. The table below shows some 
examples of the impact of the user fee on high and moderate payment 
counties as well as on floor counties.
     medicare information fee as percentage of 1998 payment update

                          MEDICARE INFORMATION FEE AS PERCENTAGE OF 1998 PAYMENT UPDATE
----------------------------------------------------------------------------------------------------------------
                                                                                                      Fee as
                                                                   User fee per   Payment update   percentage of
                     County                          Enrollees         month       (per enrollee   1998 payment
                                                                                    per month)        update
----------------------------------------------------------------------------------------------------------------
High payment counties:
    Los Angeles, CA.............................         372,149           $2.72          $12.45              22
    Philadelphia, PA............................          75,730            3.07           14.08              22
Moderate payment counties:
    Denver, CO..................................          29,086            2.20           10.08              22
    Hillsborough, FL............................          40,819            2.12            9.73              22
    Kern, CA....................................          28,377            2.24           10.24              22
    King, WA....................................          62,513            1.87            8.57              22
    Harrison, MS................................              64            2.45           11.24              22
    Hennepin, MN................................          52,100            1.77            8.11              22
Payment floor counties:
    Bonner, ID..................................             317            1.57           33.12             4.7
    Dubuque, IA.................................           4,586            1.57           31.65            5.0
----------------------------------------------------------------------------------------------------------------
\1\ Assuming a 0.428-percent assessment on the 1998 Medicare+Choice payment.

    While it is reasonable for health plans and their enrollees to 
contribute to funding HCFA's enrollment and information dissemination 
initiatives, the 14.3 percent of the beneficiaries enrolled in health 
plans should not have to bear 100 percent of the cost. Rather, they 
should pay their share of the cost, as related to their proportion of 
all Medicare beneficiaries.
    In fiscal year 1998, the user fee was applied only to Medicare 
HMOs, effectively the only type of organization participating in the 
Medicare+Choice program at that time. In fiscal year 1999, 
Medicare+Choice organizations could again be in the position of 
shouldering a disproportionate share of HCFA's beneficiary information 
user fees. Furthermore, the campaign is designed to educate 
beneficiaries regarding all their options, including providers in the 
traditional fee-for-service program. Beneficiaries in Medicare+Choice 
organizations should not have to bear the burden of the full cost of 
HCFA's education and information activities.
    Partly as a result of constrained payment growth rates under the 
new Medicare+Choice program and the imposition of a $95 million user 
fee in fiscal year 1998, a number of Medicare HMOs have announced 
reductions in the additional benefits they offer seniors. Several plans 
have ended coverage of outpatient prescription drugs, a benefit not 
covered under the traditional fee-for-service Medicare program. Other 
plans have eliminated vision and dental care benefits. Still others 
have retained these benefits but increased the cost sharing associated 
with them or raised premiums. Because the traditional fee-for-service 
Medicare program does not cover benefits like outpatient prescription 
drugs, dental, and vision, many seniors have been attracted to Medicare 
HMOs because of the more comprehensive coverage they offer. The $150 
million in beneficiary information fees authorized by the BBA and the 
$37 million in application fees requested by HCFA in its proposed 
fiscal year 1999 budget have the potential to further erode health 
plans' ability to offer these attractive benefits with little or no 
additional premium.
IV. A Closer Look at HCFA's Planned Education Activities
    In conducting the beneficiary education and information 
dissemination activities, AAHP urges HCFA to examine its existing 
infrastructure for disseminating information to beneficiaries. Although 
HCFA currently conducts numerous beneficiary education and information 
dissemination activities, it is unclear whether HCFA will use its 
existing capabilities or create a new infrastructure to meet the BBA 
requirements. HCFA already maintains two toll-free numbers for its 
Medicare program. HCFA also needs to explore the capacity of some of 
its sister agencies that work with Medicare beneficiaries, such as the 
Social Security Administration, in conducting education activities. The 
Social Security Administration maintains a toll-free number that could 
also assist in providing information to Medicare beneficiaries.
    In addition, almost every state has a separate toll-free line 
operated by the state's Department on Aging and Department of Insurance 
under HCFA's Health Insurance Information, Counseling, and Assistance 
program. It is possible that this capacity could be tapped for the 
Medicare beneficiary education and information dissemination 
activities. States' health insurance counseling programs distribute 
comparative health plan information and it would appear that at least 
some of HCFA's efforts may be duplicative of these local activities.
    Moreover, HCFA's cost estimates for certain activities far exceed 
actual costs incurred by health plans operating similar services. 
Several health plans that operate toll-free lines to field pre- and 
post-enrollment questions reported a $5.50 or less per call estimate 
including phone calls, training, staffing, and other overhead. HCFA's 
initial per-call estimate of $7.50, which does not include training and 
other overhead, is 36 percent more than the $5.50 (or less) per call 
reported by several health plans.
    Plans' experiences in educating beneficiaries clearly show that 
certain activities are more effective than others and that the 
effectiveness of a strategy can vary geographically. As HCFA proceeds 
with its campaign, we recommend that HCFA continue to create forums so 
that health plans and others with experience in beneficiary education 
have an opportunity to share their lessons learned. For example, many 
plans no longer consider health fairs an effective communications 
strategy yet HCFA initially requested $65 million for health fairs and 
other public relations activities.
    A majority of health plans surveyed by AAHP reported an average 
health fair attendance of 100 or fewer Medicare beneficiaries. In many 
cases, average attendance was much lower than 100. Health plans have 
had as few as four, eight, and fifteen beneficiaries attend health 
fairs, even though the events are designed to accommodate a larger 
audience. Weather conditions, timing, and location of the health fair, 
along with the availability of refreshments and token souvenirs, are 
crucial factors that influence beneficiaries' attendance.
    HCFA has limited experience with program-wide information 
dissemination initiatives, and must develop the expertise to plan, 
administer and carry out the programs necessitated by the BBA. A 
massive initial effort does not allow sufficient opportunity to learn 
from experience. In addition, state experience with enrollment brokers 
has demonstrated that contracting out these activities presents 
substantial challenges to define contractor accountability and to 
monitor their performance. Consequently, even if HCFA contracts out 
significant portions of the new programs, a broad first-year effort 
would be unwise.
    When Congress appropriated $95 million for these activities in 1998 
it suggested that HCFA focus first on developing and publishing the 
comparative information booklet. The prioritization recommended by 
Congress represents a good first step to focus HCFA's efforts. AAHP 
strongly urges that steps following publication of comparative 
information consist of pilot testing of carefully designed projects 
during the initial years of the Medicare+Choice program. Pilot testing 
education and information dissemination activities will build a better 
foundation for effective education and information activities during 
future coordinated open enrollment periods than would conducting a 
range of untested activities.
    Finally, it is unclear whether HCFA has done any additional 
research or budgetary analysis to determine more accurately how much 
funding is needed for the various beneficiary education activities 
required under the BBA. Furthermore, HCFA has not indicated whether it 
intends to supplement funds authorized for its fiscal year 1998 or 
fiscal year 1999 beneficiary education and information dissemination 
campaign with other funds, such as those funds dedicated to 
administrative or program management activities.
V. Additional User Fees Pose Additional Hardships on Beneficiaries and 
        Plan
    In addition to the $150 million authorized by the BBA for 
beneficiary education activities in fiscal year 1999, HCFA has 
requested $37 million in user fees from Medicare+Choice organizations 
for reviewing initial applications and contract renewals. Such a user 
fee was not anticipated by Congress when it enacted the Medicare+Choice 
payment methodology. In addition, new user fees such as this one and 
the others included in HCFA's budget raise the question of whether it 
is appropriate to fund government activities through user fees.
    The $37 million in user fees for reviewing initial applications and 
for contract renewals represents a significant burden on the 322 health 
plans already participating in the Medicare HMO program. These user 
fees could also potentially dampen interest among new entrants to the 
Medicare+Choice program. Health plans invest considerable resources in 
becoming Medicare HMOs. It is not unusual for a plan to spend $100,000 
to $150,000 just to prepare and submit an application to become a 
Medicare risk HMO. An additional user fee of $115,000 per plan presents 
an unreasonable barrier to entry for new plans that are considering 
serving seniors through the Medicare+Choice program. Furthermore, a fee 
of this level raises the question of the actual cost for HCFA to 
conduct reviews of application and renewals and what specific resources 
the fee would finance.
    Currently HCFA does not charge an application or contract renewal 
fee. In addition, HCFA has indicated that it intends to make the 
initial application process for existing Medicare health plans to 
convert to Medicare+Choice plans fairly simple and streamlined. It is 
unclear therefore, why HCFA needs to collect what would amount to a 
$115,000 tax per health plan to conduct these limited activities. In 
addition, if this fee is approved by Congress and it subsequently 
generates more funds than HCFA spends on reviewing application and 
renewal, AAHP believes that excess funds should be returned to 
Medicare+Choice organizations so they can dedicate these resources to 
patient care.
VI. Conclusion
    AAHP looks forward to working with HCFA as it implements its 
beneficiary education and information dissemination campaign. Health 
plans have valuable experience to share with HCFA in how to best 
communicate with seniors and how to be responsive to their information 
needs. An effective education campaign will be critical to informing 
beneficiaries about their new options under the Medicare+Choice 
program. At the same time, HCFA needs to finance this campaign in a 
manner that does not disproportionately burden Medicare HMOs. Such a 
burden has the potential to limit rather than expand consumers' 
choices, and thus to undermine the key objectives of BBA. We urge the 
Subcommittee to review the assessment of the beneficiary information 
fee and whether it is equitable. In addition, we ask the Subcommittee 
to consider carefully the appropriateness of additional user fees such 
as the $37 million in user fees for reviewing initial applications and 
for contract renewals.
                                 ______
                                 
Prepared Statement of Daniel Paul Perez, President, Facioscapulohumeral 
                                Society
    Mr. Chairman, it is a great pleasure to submit this testimony to 
you today.
    My name is Daniel Paul Perez, of Lexington, Massachusetts, and I am 
testifying today as President of the Facioscapulohumeral Society and as 
an individual who has this rare disorder.
    As a chief patient activist for the tens of thousands of 
individuals living with Facioscapulohumeral Disease (FSHD) in the 
United States I will continue to argue the case of wanting to live life 
free from disease.
The FSH Society
    Eight years ago, several of us with FSHD began the task of 
organizing a society of patients. The purposes of our organization, 
which represents over 1000 families that have been diagnosed with FSHD 
are: to encourage and promote scientific and clinical research and 
development through education of the general public, governmental 
bodies and the medical profession; to support such research and 
development; to accumulate and disseminate information about FSHD; to 
actively cooperate with related organizations; and to represent 
individuals and families with FSHD.
The Clinical Picture of FSH Muscular Dystrophy
    The FSH Disorder, otherwise known as Facioscapulohumeral Muscular 
Dystrophy or FSHD, is a neuromuscular disorder that is inherited in an 
autosomal dominant fashion and has an estimated frequency of one in 
twenty thousand (1/20,000). Autosomal dominant means that there is a 
fifty-percent chance that a child will inherit the disease from an 
affected parent. The prevalence could be as much as three times greater 
than the estimated frequency stated in the literature due to an 
undetermined number of sub-clinical cases.
    The major consequence of inheriting this disease is that of a 
progressive and severe loss of skeletal muscle, with the usual pattern 
of initial noticeable weakness of facial, scapular and upper arm 
muscles and subsequent developing weaknesses of other skeletal muscles.
    The age of onset is variable and noticeable muscle weaknesses are 
usually present by the age of twenty. The penetrance of FSHD is high 
and is estimated to be near ninety-five percent. A 95 percent 
penetrance implies that the expression of the FSH disorder will be 
outwardly noticeable in 95 out of 100 patients with the FSHD genetic 
defect by the age of twenty. The age of onset and the severity of 
clinical symptoms are variable within and between families. Recent 
research has shown that in some families there will be anticipation of 
the disease. Anticipation implies that FSHD will become more and more 
severe with each successive generation affected with the disorder.
    The progression of FSHD usually begins between the first and second 
decades of life for men and between the second and third decades of 
life for women. Life expectancy is normal in many, but many if not most 
patients become significantly incapacitated in the prime of life. 
Approximately twenty percent (20 percent) of individuals with FSHD are 
wheelchair-bound by the fourth decade of life. FSHD affects both males 
and females and appears to show no racial bias.
    There are families where the parents are asymptomatic, clinically 
normal, but they have children, one or more, with FSHD. Sporadic cases 
of FSHD are common and can be caused by mutations and germline 
mosaicism.
    Lastly, an early onset, infantile form of FSHD exists where the 
symptoms are more severe than that of the typical FSHD. Children with 
infantile FSHD are wheelchair bound at a very early age. Additionally, 
the infantile form FSHD is extremely severe and may result in an early 
death. Thus, infantile FSHD resembles Duchenne muscular dystrophy in 
its clinical course and prognosis.
    Stated clearly, FSHD can be extremely severe and in some forms can 
lead to an early death. FSHD can happen to anyone of us.
The Need For NIH Funding For FSHD
    My testimony is about the profound and devastating effects of a 
disease known as Facioscapulohumeral Disease which is also known as FSH 
Muscular Dystrophy or FSHD and the urgent need for NIH funding for 
research on this disorder. In past years and earlier this year (1994, 
1995, 1997, 1998) we submitted testimony before both House and Senate 
Appropriations Committees' subcommittees on Labor, Health and Human 
Services and Education and Related Agencies which stated that NIH and 
Congress could help bring about a significant research and scientific 
opportunity which would benefit hundreds of thousands of people 
worldwide with modest investments.
    The FSH Society has previously informed the members of this 
committee of the United States Congress on the need and rationale for 
research on FSHD. We have updated you on the most recent developments 
in clinical medicine with respect to FSHD, kept you abreast of the 
latest breakthroughs in the molecular genetics of the disease and given 
you insight into the difficulty of living a lifetime with this disease.
    Largely, thanks to your efforts, Mr. Specter, NIH research funding 
continues to grow. However, I regret to say that not all areas of 
promising research are benefiting. It saddens me to inform you that the 
American research effort on FSHD has suffered a tremendous setback in 
the past two years with loss of momentum on the only NIH project 
working on FSHD molecular genetics. At risk are invaluable and 
irreplaceable cell lines and pedigrees, which currently have no 
permanent repository. We need to create a core center for FSHD research 
to be run within the auspices of the NIH. We need intramural NIH 
programs enacted immediately. We need extramural contracts and grant 
programs enacted immediately.
    We have met at NIH with regard to the current crisis in FSHD 
research. The National Institute of Neurological Disorders and Stroke 
(NINDS), the National Institute of Arthritis, Musculoskelatal and Skin 
Diseases (NIAMS) and the Office of Rare Disorders (ORD) and the FSH 
Society recently held, for the first time ever in the United States of 
America, an International Conference on the Cause and Treatment of 
Facioscapulohumeral Muscular Dystrophy (FSHD) in Boston, Massachusetts 
on April 12, 1997. We all realize the profound loss of dedicated and 
talented professionals working on FSHD from coast to coast and the 
continuing need to attract, retain and maintain programs solely focused 
on FSHD. The purpose of the International conference on FSHD was to 
promote research in this area and to encourage scientists and 
researchers to submit the research grants on FSHD.
    In the past year the communication between the research community, 
the FSH Society, NIH (NIAMS, NINDS and ORD) and Congress has been 
unprecedented. We are indebted to the members of this subcommittee and 
to your colleague Representative Edward J. Markey from Massachusetts 
for his continued support and for the report language submitted to you 
last year and co-signers Representatives Barney Frank, John M. McHugh, 
Martin T. Meehan, Charles E. Schumer and Robert Wexler.
    In late February, 1998, after giving testimony before the House of 
Representatives on Appropriations for FSHD, we received a formal 
response to last year's report language from Congress to the Director 
of NIH with respect to research on FSHD. In the third or fourth week of 
February, 1998, the National Institutes of Health (NIH) responded to 
Congress as follows: ``The NIAMS and the National Institute of 
Neurological Disorders and Stroke (NINDS) support research on the many 
forms of muscular dystrophy including Facioscapulohumeral disease 
(FSHD). In 1990 scientists discovered the general location of the 
defective gene for FSHD on chromosome 4. However, much remains to be 
learned about the functional changes that accompany the disease and 
treatments. In April 1997, the NIAMS, NINDS and the NIH office of Rare 
Diseases, along with the Facioscapulohumeral Society, held a FSHD 
conference designed to identity medical problems associated with the 
disease and to help focus research efforts by identifying new research 
opportunities. As the next step in an effort to increase research 
interest on FSHD, NIAMS and NINDS are developing a program announcement 
to follow-up on recommendations from the April meeting. NIAMS, NNDS and 
the NIH Office of Rare Diseases will continue to work closely on 
encouraging FSHD research and to share relevant scientific advances.''
    On March 20, 1998, shortly after the response to Congress regarding 
the report language, the National Institutes of Health issued Program 
Announcement 98-044 (PA-98-044) jointly sponsored by the National 
Institute of Neurological Disorders and Stroke (NINDS) and the National 
Institute of Arthritis and Musculoskeletal and Skin Diseases (NIAMS) 
titled ``Pathogenesis and Therapy of the Muscular Dystrophies.''
    The purpose of the PA-98-044 is as follows: ``The National 
Institute of Neurological Disorders and Stroke (NINDS) and the National 
Institute of Arthritis and Musculoskeletal and Skin Diseases (NIAMS) 
encourage investigator-initiated research grant applications to study 
the pathogenesis and therapy of the various forms of muscular dystrophy 
in children and adults. Responses to this program announcement may 
include studies in appropriate animal models or preclinical or clinical 
studies in patients with Facioscapuilohumeral dystrophy (FSH), limb-
girdle muscular dystrophy (LGMD), myotonic dystrophy, congenital 
muscular dystrophy (CMD), Emery-Dreifuss muscular dystrophy (EMD), 
Duchenne muscular dystrophy (DMD), Becker muscular dystrophy (BMD), or 
other forms of muscular dystrophy.''
    The FSH Society appreciates NIH's response to last year's Committee 
Report which encouraged NIH take steps to stimulate research in the 
area of Facioscapuilohumeral disease (FSHD) which it has done through a 
program announcement covering FSHD as well as other muscular 
dystrophies. However, the FSH Society notes that NIH has not responded 
in developing a plan for enhancing FSHD research including the question 
whether an intramural program in this area would be beneficial. 
Therefore, the FSH Society urges NIH to conduct a research planning 
conference in the near future in order explore scientific opportunities 
in FSHD research both intramurally and extramurally.
Report Language from Congress to the NIH for Research on FSHD
    ``The Committee appreciates NIH's response to last year's Committee 
Report which encouraged NIH take steps to stimulate research in the 
area of Facioscapulohumeral disease (FSHD) which it has done through a 
program announcement covering FSHD as well as other muscular 
dystrophies. However, the Committee notes that NIH has not responded in 
developing a plan for enhancing FSHD research including the question 
whether an intramural program in this area would be beneficial. 
Therefore, the Committee urges NIH to conduct a research planning 
conference in the near future in order explore scientific opportunities 
in FSHD research both intramurally and extramurally.''
Conclusion
    The men, women and children who live with the daily consequences of 
this devastating disease are your friends, neighbors, fellow taxpayers 
and contributors to the American way of life. With an historical 88 
percent employment rate and an average educational achievement level of 
14 years (source: Impairment and Disability Profiles on Neuromuscular 
Diseases: Facioscapulohumeral Muscular Dystrophy, Research and Training 
Center on Neuromuscular Disease, Department of Physical Medicine & 
Rehabilitation, University of California, Davis and The National 
Institute on Disability & Rehabilitation Research, 1994), we personally 
bear our burden of the health care costs and training expenses to 
prepare for and maintain financial and personal independence.
    We appeal to you today to take our hard earned tax dollars 
commensurate with our numbers and valuable contributions to American 
Society. We urge the United Sates government to allocate a proportion 
of our tax burden towards research on FSHD. The current amount per 
person per year living with FSHD is unacceptable. We ask for an overall 
research budget that will cover the creation of a core center for 
research at NIH and the expansion of extramural and intramural research 
programs.
    Time is of the essence here. Lives are in the balance and the race 
against this disease is ongoing. The FSHD community believes that now 
is the time to move to action and it demands persistent and innovative 
research programs and the willingness to take risks in previously 
uncharted territory. We who are gradually losing strength physically 
daily are gaining it rapidly in collective numbers. We who are least 
able to do the simplest physical tasks daily have undertaken the most 
complex task of FSHD. We who have the most severe limitations imposed 
on us have mobilized. We stand ready, we have moved to action, and we 
are prepared to act cooperatively with the NIH and with Congress.
    This is the United States of America, and in a country as great as 
ours with all of its technical means and ability it should be 
absolutely clear, if not completely black and white, that the number 
one priority for individuals with FSHD and the one absolutely 
commanding imperative for the Federal Government is to initiate and 
accelerate in any way possible, research on FSHD. With modest funding 
and a clear direction from Congress to the NIH to support research on 
FSHD significant progress can be made in conquering and eliminating 
this and other devastating diseases.
    Mr. Chairman, again, thank you for providing this opportunity to 
testify before your subcommittee.
                                 ______
                                 
Prepared Statement of Paul L. Kaufman, M.D., President, Association for 
                  Research in Vision and Ophthalmology
    On behalf of the Association for Research in Vision and 
Ophthalmology (ARVO), the world's largest organization of clinicians 
and scientists dedicated to the field of eye and vision research, I am 
grateful for the opportunity to provide input to the Senate 
Appropriations Subcommittee on Labor, Health and Human Services, 
Education and Related Agencies concerning the fiscal year 1999 budget 
request for the National Institutes of Health. A more detailed 
statement of our position is outlined in the testimony which will be 
submitted to the Subcommittee on behalf of the National Alliance for 
Eye and Vision Research.
    We are beginning to reap the health care benefits of our 
investment, via the NIH/NEI, in basic and clinical vision science, but 
more and more we are forced to prioritize between important and 
promising opportunities because of insufficient funding.
    It is only through further advances in research that we will gain a 
better understanding of vision disorders, and thereby develop cost-
effective advances in disease prevention and treatment. This will be 
ever more important as our population ages, since the most common 
blinding disorders are strongly age-related.
    We now have the scientific and technological capability to make 
substantial progress in all areas of eye and vision research, if an 
expanded research effort is supported. Such progress will only be 
possible if we insure that the NEI has sufficient resources to pursue 
initiatives in the key areas outlined in the soon-to-be-released Vision 
Research Plan of the NEI.
    Tremendous advances have been made in understanding the 
epidemiology, cell, molecular-, and neuro-biology, and molecular 
genetics of age-related macular degeneration, diabetic and inflammatory 
eye disease, glaucoma, cataract, and developmental disorders of the 
visual system, and in developing pharmacologic and surgical therapies 
to redress the altered pathophysiology of these diseases. Despite 
remarkable progress, our current diagnostic, therapeutic and preventive 
measures are far from ideal in terms of efficacy, safety, tolerability 
and cost-effectiveness. The opportunities to advance our basic 
scientific knowledge of ocular and visual system pathophysiology, and 
translate it into improved therapy and prevention of disease, are 
unprecedented. However, this will require a quantum leap in funding to 
the NEI, which we hope that the Committee will allocate.
    We thank you for your continuing support for medical research 
funding, and urge you to provide a 15 percent increase in fiscal year 
1999 for the NIH as the first step toward doubling the budget over the 
next five years. Furthermore, we urge you to provide $408.6 million, a 
15 percent increase, for NEI in fiscal year 1999 as requested by the 
National Advisory Eye Council in its ``Citizens Budget Proposal''.
    Thank you for the opportunity to participate in the process.
                                 ______
                                 
 Prepared Statement of the American College of Preventive Medicine and 
           the Association of Teachers of Preventive Medicine
    The American College of Preventive Medicine (ACPM) and the 
Association of Teachers of Preventive Medicine (ATPM) are pleased to 
submit jointly this statement concerning appropriations for federal 
activities in disease prevention and health promotion.
    ACPM is the national medical specialty society of physicians whose 
primary interest and expertise are in preventive medicine. ATPM is the 
professional organization of academic departments, faculty and others 
concerned with undergraduate and postgraduate medical education in 
preventive medicine. Together, these organizations are proud to offer 
the public a high degree of knowledge and skill in disease prevention 
and health promotion.
    ACPM and ATPM urge the Subcommittee to maintain federal support for 
prevention. In particular, we urge a minimal increase in the level of 
funding for preventive medicine residency training and for training 
other public health professionals included in Title VII of the Public 
Health Service Act. We also urge an increase for the activities of the 
Centers for Disease Control and Prevention and an earmark for the 
invaluable work of the Office of Disease Prevention and Health 
Promotion in the Office of the HHS Secretary.
    We are well aware of the fiscal constraints that this Subcommittee 
faces and we do not make these recommendations lightly. However, we are 
deeply concerned that weakening our nation's efforts in disease 
prevention and health promotion will become an unintended consequence 
of necessary reductions in discretionary appropriations. At a time when 
the private sector is struggling mightily to contain medical care 
costs, the nation can ill afford a diminution in public health efforts 
to prevent disease that only the government can conduct. Compared to 
the vast sums of public funds that are spent on curative medicine, the 
amounts that we recommend be targeted to prevention are small indeed.
Training in Preventive Medicine and Public Health--$9 million
    Prevention, in its broadest sense, is practiced by all physicians 
and other health professionals who help their patients stay healthy. It 
also is the principal goal of our nation's state and local health 
departments, who perform core functions in health protection and 
promotion that no single private institution or health provider can 
fulfill. The specialty of preventive medicine bridges the gap between 
the perspectives of clinical medicine and public health.
    The tools of preventive medicine are the population-based health 
sciences, including epidemiology, biostatistics, environmental and 
occupational health, planning, management and evaluation of health 
services, and the social and behavioral aspects of health and disease. 
These are the classic tools of practice in public health agencies, but 
they have grown in importance in other health care settings where there 
is increasing recognition that improving the health of a patient 
population and reducing the costs of medical care also require 
application of the population-based health sciences.
    Departments of preventive medicine, community medicine, or social 
medicine in medical schools, schools of public health, and preventive 
medicine residency programs (which are located in medical schools, 
schools of public health, and a few health departments), are the loci 
of expertise in the population-based health sciences. Federal support 
for preventive medicine training and public health training is 
essential to help meet the workforce needs not only of public health 
departments, but also of a rapidly-evolving health care system that 
must be cost-effective and accountable.
    The small sums appropriated for preventive medicine residency 
training under Section 763 in Title VII of the Public Health Service 
Act have been the exclusive federal support for programs training 
physicians in general preventive medicine and public health (other than 
the residency programs conducted by the Centers for Disease Control and 
Prevention and the military). Medicare graduate medical education funds 
have been largely unavailable to these programs because they are based 
not in hospitals but in community outpatient and public health 
settings. Because preventive medicine programs derive little or no 
revenue from one-on-one patient care, this common source of funds for 
physician training also is unavailable.
    Currently, residency programs scramble to patch together funding 
packages for their residents. Funding from any source is available for 
only 60 percent of preventive medicine residency positions. The 
remainder of the openings go unfilled due to lack of funds, and 
potential applicants must be turned away.
    A 1991 survey of all 1,070 graduates of general preventive 
medicine/public health residency programs from 1979 to 1989 conducted 
by Battelle, an independent consultant under contract to the Centers 
for Disease Control and Prevention and the Health Resources and 
Services Administration provided a clear picture of the accomplishments 
of the training programs and the impact of these federal funds. A 
majority of the graduates have initiated or managed major programs in 
prevention and control of infectious disease, chronic disease, sexually 
transmitted diseases, or maternal and child health. In addition to 
creating and running community health programs such as these, 60 
percent of the graduates engage in research in disease prevention and 
health promotion, and 70 percent also take care of individual patients.
    This survey also documented that funds invested in training these 
physicians have a lasting impact. Ninety percent of preventive medicine 
graduates remain involved in public health or preventive medicine. 
Moreover, Title VII funds were shown to be directly related to the 
viability of preventive medicine residency programs. In programs that 
have received federal grants, the number of graduates has more than 
doubled since 1983. Conversely, the number of graduates of programs 
that no longer receive federal funds has decreased significantly.
    The training of public health professionals is closely linked to 
preventive medicine. The nation's 28 schools of public health provide 
training for physician specialists in preventive medicine as well as 
for many other health professionals who comprise our public health 
workforce. In addition to the shortage of physicians trained in 
preventive medicine, there are shortages of epidemiologists, 
biostatisticians, environmental and occupational health specialists, 
public health nutritionists and public health nurses. In addition to 
Section 763, Sections 761 and 762 of Title VII (Public Health 
Traineeships and Public Health Special Projects) support public health 
training in these areas. An appropriation of $9 million for Sections 
761, 762, and 763 in fiscal year 1998 will allow for the continuation 
of efforts to build the nation's cadre of prevention professionals. 
Finally, ACPM and ATPM support the Health Professions and Nursing 
Education Coalition's (HPNEC) recommendation of $306 million for all of 
the health professions education programs funded under Titles VII and 
VII of the Public Health Service Act.
Centers for Disease Control and Prevention--$3 billion
    Physicians working in preventive medicine and public health rely 
heavily on the expertise and activities of the Centers for Disease 
Control and Prevention, the nation's premier agency for disease 
prevention and health promotion. Therefore, we support, alongside many 
other organizations and coalitions with a concern for prevention, 
including the Coalition for Health Funding and the CDC Coalition, a 
total CDC appropriation of $3 billion.
    Through funding of state and local prevention programs, research, 
training and surveillance, CDC has a major impact on every important 
issue in prevention. Compared to the billions that are spent on acute 
health care, our national investment in prevention continues to lag. 
The increases in health care costs we have witnessed are not a reason 
to cut back on funds appropriated for prevention. They are a reason to 
make a large investment now. Given the resources, CDC can play a 
critical role in revitalizing programs and services of proven 
effectiveness in reducing death and disability in this country. 
Reducing CDC funds would be an act of extraordinary short-sightedness. 
Time and again we have seen, as in the cases of tuberculosis and 
measles, when public health efforts falter, the nation pays a high 
price later in the costs of preventable disease.
Office of Disease Prevention and Health Promotion--$4.6 million
    The Office of Disease Prevention and Health Promotion (ODPHP) 
stands out among federal agencies for its ability to leverage small 
amounts of funding into large accomplishments in highly innovative 
ways. ODPHP manages the Healthy People 2000 initiative, the national 
prevention strategy used by health agencies across the nation to set 
measurable objectives for health improvement. ODPHP provides guidance 
and prototype materials to health practitioners through the Put 
Prevention Into Practice (PPIP) project. It is conducting ground-
breaking research concerning the cost-effectiveness of preventive 
services, and has long served as the focal point for coordinating 
departmental activities in prevention as well as innovative public-
private partnerships. Explicit support for ODPHP is vital in signaling 
a continued federal commitment at the Secretary's level to leadership 
in prevention. We urge the Subcommittee to earmark $4.6 million for 
this office, an amount equivalent to fiscal year 1995 funding, before 
the budget for this office was incorporated into the amounts 
appropriated for the Office of the Secretary.
                                 ______
                                 
    Prepared Statement of the American Society of Clinical Oncology
    The American Society of Clinical Oncology (ASCO) is pleased to 
submit comments to the Subcommittee regarding the cancer research 
program supported by the National Cancer Institute (NCI). ASCO is a 
national medical specialty society representing more than 11,000 cancer 
specialists involved in patient care and clinical research.
    The nation recently received the good news, reported by NCI, the 
Centers for Disease Control and Prevention (CDC) and the American 
Cancer Society, that both the incidence of cancer and death from the 
disease have declined. This announcement represents tangible evidence 
of returns from the federal government's investment in cancer research. 
More subtle but possibly more important, we are enjoying an 
unparalleled era of discovery in genetics and molecular biology that 
will likely lead to even greater declines in cancer incidence and 
mortality in the not-too-distant future.
    However, in order to enjoy the full potential of these biomedical 
research discoveries, they must be translated into clinical 
applications. The process by which basic science is harnessed for 
patient benefit is through translational and clinical research. The NCI 
budget must fully support translational and clinical research if 
results in terms of cancer incidence and mortality are to be maximized.
    To ensure the healthiest possible environment for clinical 
research, ASCO recommends: significant increases in funding for all 
cancer research, from basic to translational to clinical; reforms in 
the peer review of patient-oriented research proposals; improvements in 
the training of clinical researchers; and Medicare coverage for the 
patient care costs of those enrolled in high-quality clinical trials. 
Although the last recommendation is not strictly in the jurisdiction of 
the Subcommittee, recognition by all third-party payors that they 
should cover patient care costs for those enrolled in such trials is an 
essential element of support for clinical research.
                        increases in nih funding
    ASCO applauds the proposal of the Clinton Administration to 
increase National Institutes of Health (NIH) funding by approximately 
8.5 percent in fiscal year 1999 and boost funding for cancer research 
by 10 percent in fiscal year 1999 and by 65 percent over five years. 
This action is a significant departure for the Administration, which 
has previously proposed very modest increases in NIH funding, and was 
apparently a response to the tremendous research opportunities that 
greet investigators today. Although we are pleased that the 
Administration has proposed to increase funding for NIH, we also 
support the more ambitious recommendation of the Ad Hoc Group for 
Medical Research Funding that the NIH budget be increased by 15 percent 
in fiscal year 1999.
    Our support for the Ad Hoc Group recommendation is not intended to 
undermine the NCI Bypass Budget. In past years, the cancer community 
has made reference to the NCI Bypass Budget, without a real expectation 
that it would be adopted. This year, in contrast, we believe the Bypass 
Budget must be seriously considered. The Bypass Budget is a concise 
document which presents the professional judgment of NCI regarding the 
funding necessary to support current cancer research opportunities. 
Because this is an era of impressive discovery in several areas of 
cancer research, the Bypass Budget makes a persuasive case for a 
substantial increase in NCI funding to take advantage of these critical 
research opportunities. Some Members of Congress have asked if NCI can 
absorb such a significant increase in funding. ASCO believes that 
increases of the magnitude proposed in the Bypass Budget--35 percent in 
fiscal year 1999--could be used productively to advance our knowledge 
of the underlying mechanisms of cancer and improve treatment of the 
disease.
         peer review of patient-oriented research applications
    Basic research findings must be evaluated in clinical trials that 
include actual patients before new therapies are accepted as standard 
medical practice. ASCO has long believed that the current process of 
peer review at NIH is not adequate to evaluate clinical research 
proposals. Study sections, which are the groups that review all 
investigator-initiated research proposals, are dominated by basic 
scientists who may not be familiar with the methodologies used in 
clinical research. Moreover, basic research involving relatively 
straightforward laboratory measures usually scores higher in the review 
process than that which includes patient-oriented outcomes.
    In order to correct these imbalances, ASCO has advocated since 1991 
establishment of a separate study section specifically dedicated to 
clinical research. Support for significant reform of the review system 
has now reached a critical mass: various Members of Congress have urged 
appointment of a special clinical research review panel; an NIH-
appointed clinical research study group concluded that patient-oriented 
research is not treated equitably and recommended significant reforms 
of the peer review system; an Institute of Medicine study documented 
the hurdles to funding clinical research; and the National Cancer 
Advisory Board has endorsed a specific study section for clinical 
cancer research.
    Although NIH has instituted some welcome improvements in the peer 
review process, it has not established a study section for the review 
of cancer clinical research applications. The Center for Scientific 
Review, formerly called the Division of Research Grants, indicated 
several months ago that it would establish, on a pilot basis, a special 
study section for the review of cancer clinical research applications. 
Despite that announcement, no such review panel has been formed.
    Unless a more suitable review mechanism for investigator-initiated 
research applications is promptly established, a whole generation of 
potential researchers will be discouraged and major advances in patient 
care may be at risk. ASCO believes there should be no further delay in 
appointing a cancer clinical research study section, a modest step that 
will bring equity to the review of patient-oriented research 
applications. We urge the Subcommittee to require NIH to report, by May 
31, 1998, on its progress in forming the cancer clinical research study 
section.
                    training of clinical researchers
    Careers in clinical research are becoming exceedingly unattractive 
to young investigators. In addition to facing uncertainties about 
funding for their research, clinical investigators are also under great 
pressure to maximize patient care revenues, leaving little time for 
clinical research. It is difficult for physicians in this environment 
to pursue careers in clinical research. Fundamental changes in the 
health care system will be necessary to ensure a cohort of clinical 
researchers in the next generation, and NIH should be charged with 
developing recommendations to address the practical barriers to 
clinical research in a health care system increasingly dominated by 
managed care and for-profit medicine.
    In the shorter term, as NIH considers these difficult issues, ASCO 
advocates that NIH increase funding that allows experienced senior 
clinical researchers to serve as mentors for young clinical 
researchers. ASCO uses its own funds to support a training program for 
clinical researchers that includes mentoring as one of its features. We 
believe this mentoring program provides significant encouragement to 
those who are beginning their clinical research careers and should be 
replicated in NIH grants. We applaud the recent announcement by NIH of 
a Mentored Patient-Oriented Research Career Development Award that will 
provide mentored research experience for clinical investigators and 
look forward to enhanced efforts in this area, where the federal cost 
is modest and the benefits substantial.
medicare coverage for patient care costs for patients participating in 
                            clinical trials
    For the cancer community, one of the most important features of the 
President's budget is the proposal to establish a Medicare 
demonstration project that would provide reimbursement for the routine 
patient care costs for patients enrolled in cancer clinical trials. The 
best care for cancer patients is often in a clinical trial. 
Furthermore, clinical trials advance our knowledge about the best 
possible treatment for cancer. Unfortunately, the Medicare policy on 
coverage of clinical trials is unclear, and Medicare beneficiaries are 
often discouraged from enrolling in trials, even when those trials 
represent their best treatment option.
    The Clinton initiative would address this problem by guaranteeing 
payment for patient care costs for those beneficiaries who enroll in 
certain ``approved'' trials. Purely research costs associated with the 
conduct of clinical trials--including supplying the investigational 
agent and collecting and analyzing data--would continue to be borne by 
the research sponsor, whether NIH or industry. However, patients 
enrolled in approved clinical trials would be assured that the Medicare 
program would not deny payment for routine patient care costs like 
physician or hospital charges. ASCO has worked for many years to secure 
Medicare patients this guarantee of access to quality clinical trials. 
Assured Medicare coverage would not only improve treatment for the 
individual patient but also integrate clinical trials into the standard 
of care for Medicare beneficiaries with cancer. For this Subcommittee, 
the proposal is important because it creates a positive environment for 
clinical research without requiring the expenditure of discretionary 
funds.
    The Clinton-Gore clinical trials proposal is modeled after 
legislation introduced in the 105th Congress by Senators Rockefeller 
and Mack and Representatives Johnson and Cardin, except it would limit 
Medicare coverage to those trials that are sponsored by NIH and give 
the Secretary the option to expand coverage to other high-quality 
clinical trials. The Rockefeller-Mack legislation, in contrast, would 
have authorized coverage of trials that are approved by NIH, the Food 
and Drug Administration, the Department of Defense, the Veterans 
Administration, and private entities with adequate peer review systems. 
These are the criteria for coverage that were developed by ASCO and 
broadly adopted by the cancer community. The Clinton-Gore proposal 
should be expanded to meet the standards of clinical trials coverage 
outlined by ASCO, because those criteria would ensure that patients 
have access to all high-quality trials that might offer them 
therapeutic benefit. ASCO will work for the enactment of legislation to 
implement Medicare coverage for cancer clinical trials and for a 
broadening of the definition of a covered cancer clinical trial.
    We appreciate the opportunity to present ASCO's recommendations to 
enhance the climate for cancer clinical research. An NIH program that 
supports all aspects of the research continuum--from basic to 
translational and clinical research--is essential if recent reductions 
in cancer incidence and mortality are to be only the first of many 
successes in our progress toward prevention and reliable cure of 
cancer.
                                 ______
                                 
Prepared Statement of Dr. Lee W. Saperstein, Dean, School of Mines and 
                Metallurgy, University of Missouri-Rolla
Introduction
    Mr. Chairman, I want to thank you for this opportunity to present 
testimony to the Subcommittee on the appropriations for fiscal year 
1999 on MSHA and NIOSH programs related to mine safety and research. I 
want to commend you for your outstanding leadership and for your 
continuing efforts to ensure that the scientific and research 
capability of this nation remains second to none.
    I am Lee W. Saperstein, Professor of Mining Engineering and Dean, 
School of Mines and Metallurgy, University of Missouri-Rolla (UMR). The 
School is one of the largest academic units in the United States 
devoted to natural resources, minerals, materials, energy, the 
environment, and the safe, productive, and environmentally sound use of 
crustal resources. It is the oldest of the three component parts of 
UMR. Founded in 1870 in response to the economic needs of Missouri, we 
are part of the great Land-Grant University movement. It is axiomatic, 
but still worth repeating, that this movement put together the States 
and the federal government in a partnership that stimulates economic 
development through education and research at our leading universities. 
This is a partnership that is as timely today as it was in 1862 when it 
was first formulated.
NASULGC Mission
    Founded in 1887, NASULGC is the nation's oldest higher education 
association. Currently the association has over 190 member 
institutions--including 17 historically black institutions--located in 
all fifty states, with a total of 3 million students. The Association's 
overriding mission is to support high quality public education through 
efforts that enhance the capacity of member institutions to perform 
their traditional teaching, research, and public service roles--roles 
which reflect a strong social commitment to investing in the 
development of America's greatest resource, its people. NASULGC does 
not receive any Federal grants. The Section on Mineral and Energy 
Resources brings together leading educators and research scholars in 
the Association's universities to promote university-based programs in 
mineral and mineral-fuel resources, and to demonstrate the importance 
to the Nation of maintaining a strong capability in research and 
education in mineral-resource engineering and science to promote public 
understanding of mineral-resource issues.
Importance of Extramural Research
    The Government Performance and Results Act presents extraordinary 
opportunities for creative partnerships between the Federal government 
and universities. These partnerships can contribute significantly to 
the national goal of a more efficient and productive Federal government 
by providing policy makers higher quality research at lower cost to 
address society's most compelling issues. The country's investment in 
higher education continues to provide not only the incalculable 
dividends associated with a better educated workforce, but also the 
very tangible benefits that meet daily human and economic needs. 
Competitive, peer-reviewed extramural research is fundamental to 
developing the technologies which ensure safe food and water supplies, 
a healthy environment, sufficient energy sources, better medical care, 
improved communications and transportation systems, a stronger national 
defense and strategies and tools to mitigate natural hazards. 
Information from such research leads to improved management of natural 
resources and maintenance of conditions that contribute to a desired 
quality of life.
Miner Safety and Health
    It is a long-term goal of all us who have worked on projects for 
miner health and safety that no mine worker should have his or her life 
shortened or health compromised in pursuit of a livelihood. Mining has 
historically ranked high among all industries in fatality and injury 
incidences and has unacceptably high prevalence rates in 
pneumoconiosis, silicosis, and noise-induced hearing loss. Efforts to 
date allow me to say that the more than 250,000 people who work today 
in the United States's mining and mineral industries enjoy an 
unprecedented record for safety. Accidents, both fatal and non-fatal 
disabling, are close to an all-time low as are their incidence rates 
(number of accidents normalized by the working hours of exposure). This 
enviable record is in itself no accident but is the result of both 
vigilance and research applied toward miners' health and safety. 
Inasmuch as a mine is not inherently a safe place, this record is a 
tremendous testimonial to our successes in promoting mine safety.
    The avoidance of work-place losses, in particular those that can 
lead to harm to workers, is achieved by three main thrusts: engineering 
design, worker training, and enforcement and inspection. Engineering 
design for safe mines includes, amongst many topics, roof and slope 
control, ventilation for removal of explosive and deleterious gases and 
dusts, safe and encompassing control cabins for equipment, and removal, 
by selective use of advanced mechanization and automation, of the 
worker from the active mining faces. These are topics that are 
researched in the national laboratories of NIOSH and the mining 
universities alike. Worker training may be either task (job skills) or 
safety training or both. The design of classes and training modules 
should reflect considerations of effectiveness, often called 
``outcomes.'' Measures of desirable outcomes could include reduced 
accident rates, increased productivity, and reduced losses. Of 
particular concern to mine safety is continuing improvement in accident 
rates among those workers who benefitted from the training. 
Universities have participated actively with MSHA in creating effective 
training materials and in designing outcome assessment programs for 
when this material is presented to miners.
    Without question, the federal presence, found in enforcement 
activities of the Department of Labor's Mine Safety and Health 
Administration (MSHA) and research activities of the Department of 
Health and Human Services' National Institute for Occupational Safety 
and Health (NIOSH), has a direct influence on this outstanding record. 
The role of the States is equally as important and often performed 
collaboratively with institutions of higher education, in furthering 
the work of the federal agencies. MSHA's State Grants program and 
NIOSH's Mine Safety and Health program of extramural grants are 
relatively modest in scope but they are key to the maintenance of the 
State-federal partnership for mine safety. I will elaborate on each.
Mine Safety and Health Administration
    NASULGC urges full funding of the fiscal year 1999 budget request 
of $211.2 million for MSHA. However, we would like to draw your 
attention to that part of MSHA that works with the States and with 
institutions of higher education, namely the State Grants program found 
within the Technical Support line of the MSHA budget. The 1999 request 
for State Grants is $6.013 million; we urge full funding of this line. 
Indeed, we urge that, where possible, MSHA consider expansion of that 
request and further involvement of universities in the achievement of 
their mission.
    The Mine Safety and Health Administration is a component part of 
the Department of Labor and is charged with fostering the health and 
safety of American miners. The State Grants program has participants 
from 44 States and the Navajo Nation. Monies are distributed by a 
formula that is reflective of a State's mining activity. The money is 
often spent on safety-related items that are specific to the geographic 
region; often the money is spent on training-program development and 
delivery. Universities, with their particular experience in course 
development, have cooperated on much of this course development. This 
cooperation can be seen with eight of the 44 State programs being 
centered in colleges or universities. Further numbers of States have 
contracted with colleges and universities to provide training or 
training materials. For example, both Pennsylvania and West Virginia 
contract with their respective State Universities for these materials. 
Penn State, West Virginia U., and the University of Kentucky cooperate 
to present a series of TRAM (Training Resources Applied to Mining) 
conferences to showcase new developments in mine training.
    MSHA, through its Educational Policy and Technical Support 
Divisions, provides training support that ensures that the nation's 
mines are able to deliver safety and task training required within the 
federal mine safety law. MSHA hopes to expand its Technical Support 
functions to provide mines and miners with an understanding of 
currently available technologies that will assist with the safety 
mission. Our universities are willing partners in this push for safety 
through training and better use of technology. As we train, we are 
providing one of the three requisites described above for safe mines. 
Of course, MSHA's main business, which we acknowledge but in which we 
do not participate, is enforcement of the nation's mine safety laws. As 
can be seen in the next section, universities look for scientific and 
technological solutions to on-going problems with the expectation that 
these solutions will make for easier compliance with the safety laws.
Office of Mine Safety and Health Research, NIOSH
    Recently, the National Institute of Occupational Safety and Health 
(NIOSH), which reports to the Centers for Disease Control and 
Prevention, Department of Health and Human Services, was given 
responsibility for research into problems of miner health and safety. 
This area of research had been part of the mission of the Bureau of 
Mines but was transferred upon the closure of the Bureau. NIOSH has 
established an Office of Mine Safety and Health Research and oversees 
the work of two national laboratories: Pittsburgh and Spokane Mine 
Safety and Health Research Centers. This research domain is one in 
which there used to be strong links between the federal laboratories 
and the universities. There are still strong emotional ties and a very 
clear parallelism of purpose. NASULGC urges the restoration of formal 
links between the laboratories and the universities. We believe that 
these links return a value in research accomplished that is far greater 
than the dollar investment in them.
    The Office of Mine Safety and Health Research was funded in fiscal 
year 1998 at $32 million. During that fiscal year a recurring amount of 
$4 million has been added to bring their total annual budget to $36 
million. The budget includes $0.5 million in extramural funding for 
research. We urge two modest but important moves: first is to increase 
the extramural research share of the budget to one million and the 
second is to consider restoration of cuts that were made when the 
function was transferred from Interior to HHS. These requests would 
expand the fiscal year 1999 budget to $42 million.
    The last requisite for safe and healthy mines is to have inherently 
safe technology and mine design. This need drives the research 
conducted by the Office. Research is needed to develop technology that 
removes or mitigates the hazards to workers at active mine locations. 
For all the advances that we have achieved, we are still uncertain over 
the reliable provision of breathable environments that rarely if never 
exceed thresholds for dust and other contaminants. Although equipment 
is more reliable than in the past, we cannot predict breakdowns and 
failures nor can we guarantee freedom from fires. We construct our 
mines within the earth and though we know a lot about its geology and 
its mechanical behavior, we still cannot predict exactly where or when 
it might fail disastrously. These problems, however, and others are 
amenable to research and may given the right combinations of talent 
yield their secrets. When they do, we will progress to another level of 
mine safety. We will also be able to share our technology with workers 
in other but related fields where vigilance is today's only insurance 
from accidents.
    Again, Mr. Chairman, thank you for the opportunity to be here today 
and I look forward to working with you and answering any questions you 
may have.
                                 ______
                                 
     Prepared Statement of Ron Kramis, Ph.D., Fibromyalgia Network
                      fibromyalgia syndrome (fms)
    Mr. Chairman and Members of the Committee, people with fibromyalgia 
syndrome (FMS) battle diffuse pain from head-to-toe, severe fatigue, 
unrestful sleep, concentration difficulties, and a myriad of symptoms. 
Studies have shown that FMS afflicts at least 2 percent of the general 
population (mostly women in the prime of their life), the symptoms 
don't go away, and prescribed therapies are ineffective. Last year a 
multi-center study published in the June issue of Journal of 
Rheumatology revealed that 26 percent of the FMS patients surveyed were 
receiving some form of disability payment. Then in September, two more 
articles from the multi-center study appeared in Arthritis & 
Rheumatism. The first stated that the average cost of treating an FMS 
patient was $2,274 per year. The second article indicated that despite 
the variety of treatments employed, patients showed no significant 
improvement over the seven-year follow up period. The high disabling 
rate, coupled with the lack of effective therapies, should have 
triggered NIH to fund more research on this condition (four years of 
Congressional language have failed to accomplish this). Instead, the 
National Institute of Arthritis, Musculoskeletal and Skin Diseases 
(NIAMS) opted last year to fund a cost-containment study on FMS to help 
out the HMOs, not the patients who suffer so miserably.
Could FMS be a Product of Stress or Mental Status?
    The answer to this question was provided by neurophysiologist 
Ronald Kramis, Ph.D., of Portland, OR, during his public witness 
testimony to the House Appropriations Subcommittee on Labor-HHS in 
January of this year:
    ``In any chronically painful condition you are going to develop 
some psychologically associated conditions. But, it is very clear that 
there are physiological mechanisms here which are known from the basic 
sciences to be related to the persistent pain that is occurring in 
these individuals. There is an unfortunate tendency right now, because 
the medical community does not have the means to treat this disease and 
they do not understand it, that there is a push to do cost-containment 
studies and get rid of these people rather than try to treat them. 
Individuals with FMS have a real disease, it's not going away, they 
will continue to tax the socio-economic system, and cost-containment is 
not the answer.''
Fibromyalgia: Pain Without Injury
    There is a major problem of faulty logic in the way this highly 
disabling condition is being perceived. The pain of fibromyalgia is not 
usually fazed by modern therapies and when you look at the tissues that 
hurt, you won't see any evidence of injury or disease. It's pain 
without tissue pathology. Just because you can't see the pain, some 
might say that the pain is not real, the usual assumption being that it 
is ``psychological.'' That's the faulty logic often employed. Pain does 
not require obvious tissue disease to be real and excruciating.
    You can understand this phenomenon quickly with a simple test. With 
your thumb and all four fingers, reach across your chest and firmly 
squeeze the back top of your shoulder muscle near the base of your 
neck. Squeeze modestly, but until it hurts--and then squeeze a bit 
more. Maintain that pressure. Now, consider living with that sensation, 
not just in your shoulder, but throughout your entire body, day after 
day, year after year. If you are able to do that, you will have some 
understanding of the quality of life of people who must endure the 
symptoms of FMS.
    Most people who do this test will experience a deep, diffuse, 
distressing pain--all in the absence of tissue pathology. This test 
doesn't produce any injury to the shoulder, but the pain felt was real. 
Some people may be surprised at how little pressure was necessary.
    The occurrence of body-wide pain in the absence of tissue damage, 
as in fibromyalgia, interferes with all aspects of a person's life and 
undermines their credibility. The problem is that normal activities can 
be exhausting, sleep is disturbed, the ability to concentrate is 
impaired, gastrointestinal function is often abnormal, persistent 
headaches are common, and the unrelenting pain that no one can see is 
often detrimental to their personal and professional lives--as it 
creates a ``credibility gap.''
Pain is Determined by the Central Nervous System
    Pain is most often perceived as if it were occurring in some 
peripheral tissue when an injury or disease is present, but the actual 
sensation of pain clearly does not occur there. The initial information 
(signal) about damage to tissues comes from the periphery. Yet, the 
perception of that signal as painful occurs in the central nervous 
system, or CNS (brain and spinal cord), not in the tissues--even though 
it feels as if the pain is in those tissues.
    If one thinks that the cause of pain must be in the tissue felt to 
be painful, one can jump to the wrong conclusion that diffuse pain 
syndromes such as fibromyalgia fall into the category of 
musculoskeletal diseases. Then when research fails to show signs of 
injury or disease in the painful tissues, false assumptions are often 
made that the pain is not real but of psychological origin.
    To further advance the science of fibromyalgia syndrome (FMS) and 
related chronic pain disorders, it is imperative to look beyond the 
tissues that hurt--the musculoskeletal structure--and examine the role 
of the central nervous system. Distortions in the way the central 
nervous system operates can lead to chronic pain without tissue injury. 
This usually results in disturbed sleep, severe fatigue, concentration 
problems, and GI upset--basically all of the symptoms of FMS.
Relevant Research Findings in FMS
    People with FMS have a threefold increase of substance P in their 
spinal fluid, which among other things, functions as a pain messenger. 
This finding is not new; it has been confirmed in three different 
laboratories. Based on the substantial body of literature from 
neuroscientists, people with such a high level of substance P would be 
expected to have their entire central nervous system functioning off 
kilter in a hypersensitized state. Substance P is also known to 
regulate a multitude of body systems and it is no surprise that 
individuals with FMS have numerous symptoms. More recently, elevations 
in nerve growth factor have been found in the spinal fluid of people 
with FMS and there is compelling scientific evidence to link this 
abnormality to the high production of substance P and disordered sleep.
    Another finding that points to the central nervous system as the 
source of problems in FMS includes lower than normal blood flow levels 
to two major pain processing areas in the brain (the thalamus and 
caudate nuclei). The principal investigator in this study, Laurence 
Bradley, Ph.D., says that this pattern of reduced blood flow in the 
brain resembles that of other chronic pain conditions involving nerve 
injury and metastatic cancer.
    The groundwork for understanding the neurological processes 
involved in pain (in the absence of tissue injury) has already been 
done for other chronic pain conditions. This science needs to be 
applied to the study of FMS. There are a large number of pain 
researchers who would be eager to apply their knowledge to the study of 
FMS if only NIH would provide sufficient opportunity to do so.
Economic Responsibility
    A recent multi-center study showed that 26 percent of the patients 
surveyed were receiving some form of disability compensation. The 
average annual health care cost for a fibromyalgia patient is $2,274. 
Over 20 billion dollars per year are being spent on fibromyalgia 
patients because physicians are unable to provide them with therapies 
that work. Despite this huge financial drain and frustrating attempts 
by clinicians to treat the pain, the quality of life for a person with 
fibromyalgia is poor.
    Ordinarily, when a medical condition produces a high degree of 
work-disability and treatments are not effective, rational thinking 
would lead to more research on the condition. For FMS, fears over the 
costs that may be required to help people with this medical problem 
have overshadowed rational thinking. Last year, NIAMS added a cost-
containment study to its list of funded projects. This study is 
designed to trim $1,200 per year off of the HMO health care costs of 
tending to each person with FMS. The needs of patients with FMS are 
being forced into second place, behind the needs of cost-cutting HMOs 
to make a profit.
    The cost issue is real, but disregarding individuals with FMS is 
not an effective approach. People racked with the unyielding pain and 
draining fatigue of FMS will continue to seek medical attention, and in 
the absence of effective therapies, many will be forced to apply for 
disability compensation.
    Economic responsibility to ensure that adequate research is being 
done on FMS rests on the shoulders of this Appropriations Committee and 
NIH. This Committee has passed language for the past 4 years, urging 
NIAMS to step up its research program on FMS. NIAMS has refused and, 
instead, has stepped into the cost-containment funding arena--an action 
that will only escalate patient suffering. Regardless of all of the 
mishaps that have been occurring at NIH, it is still up to this 
Committee to enforce economic responsibility in research matters 
pertaining to health conditions such as FMS.
Recommendations
    NIAMS has traditionally been the home of FMS research and should 
step up its efforts in this area (NIAMS-funded research has been 
stagnant for three years). However, with modern advances in our 
understanding of chronic pain syndromes, it is appropriate for the 
neurological Institute (NINDS) to also be a significant sponsor of 
research on FMS. Here are our recommendations:
    NIAMS, in cooperation with NINDS, the Office of Alternative 
Medicine (OAM), the Office of Behavioral and Social Sciences Research 
(OBSSR), and the National Institute of Dental Research (NIDR), 
published an RFA on March 26 of this year. The estimated funds 
available adds up to only $1.85 million after years of NIH doing 
precious little. This RFA was not a surprise; it was recommended last 
year by both the House and Senate Appropriations Committees. Although 
one of the areas of interest includes pain-related research, many of 
the other items being solicited have to do with psychiatrizing FMS. 
Pharmacological treatments are not even listed, but proposals for 
behavioral and alternative therapies are being solicited in place of 
testing traditional medicines used for other painful conditions. We ask 
this committee to urge NIH to place stronger emphasis on pain mechanism 
research, investigation of disease markers, and pharmacological 
interventions--the three areas that will help FMS patients the most.
    NIAMS and NINDS should routinely publish a 2-year PA on FMS to 
generate grant proposals from scientists of all different specialties. 
The PA will also work to lower the pay-line for FMS grants, which is a 
necessary step because only a few investigators have sufficient 
preliminary data on FMS to compete with applications for researching 
other medical conditions that have been studied for years.
    A Special Emphasis Panel (SEP) was set up 2 years ago to grade 
research grant proposals submitted to NIH on FMS and the related 
condition, chronic fatigue syndrome. This SEP needs to be recognized by 
NINDS and other Institutes at NIH.
                                 ______
                                 
 Prepared Statement of the Population Association of America (PAA) and 
              the Association of Population Centers (APC)
    Thank you, Mr. Chairman for this opportunity to present the 
position of the Population Association of America (PAA) and the 
Association of Population Centers (APC) to the Subcommittee on Labor, 
Health and Human Services and Education on fiscal year 1999 funding for 
the National Institutes of Health (NIH), specifically the National 
Institute on Aging (NIA), and the National Institute of Child and 
Maternal Health (NICHD). You are a long-standing friend of both 
organizations and we want to emphasize how grateful we are for your 
appreciation and support of demographic research.
    As you know, PAA is a scientific and educational society of 
professionals working in demographic research. APC is a consortium of 
27 leading American population research centers. In addition to their 
academic roles, members of both organizations provide federal, state 
and local government agencies, as well as private sector institutions, 
with data and research to guide decision-making.
    In this testimony, we wish to express our support for the National 
Institutes of Health (NIH), specifically NIH support for demographic, 
social and behavioral research, and share recent demographic trends and 
research findings of interest with Congress.
    Demographic research covers many issues important to our nation, 
such as retirement, minority health, disability and long term care, 
child care, immigration, labor force participation, worker retraining, 
family formation and dissolution and population forecasting. The United 
States is undergoing far-reaching shifts in its demographic composition 
and distribution. Such changes often are not recognized or understood 
until they confront society with new and immediate needs--often 
requiring federal and state expenditures. Incorporating demographic, 
social and behavioral research into long term policy discussions allow 
such changes to be tracked and anticipated in a manner that promotes 
more coherent and efficient planning and policy implementation.
    NIH, specifically the National Institute of Child Health and Human 
Development (NICHD) and the National Institute on Aging (NIA) provide 
primary support for demographic research. We would like to take this 
opportunity to share with you information concerning aging, trends in 
adolescent health, the incidence of teenage pregnancy and abortion 
prevalence and changes in fatherhood.
The National Institute of Child Health and Human Development (NICHD)
    NICHD has a well-established, successful population research 
program. NICHD is currently funded at $674 million with $39.6 million 
of the budget for research funded through the Demographic and 
Behavioral Sciences. Among the many areas of demographic research 
supported by NICHD are families and households; marriage and family 
change; fertility and family planning; teen pregnancy; mortality; HIV 
prevention; and population movement, distribution and composition. 
NICHD also funds a highly regarded population research centers program. 
Population research centers provide a critical core of professionals 
who conduct research in a cost-effective manner. Further, the centers' 
training programs are an essential source of population scientists who 
bring fresh perspectives, ideas and improved methodologies to 
demographic research.
    As you can see from the wide range of research topics listed above, 
NICHD-supported demographic research provides important, ongoing 
information critical to policymakers. Last year's committee report for 
the fiscal year 1998 NICHD appropriation specifically mentioned the 
National Longitudinal Study of Adolescent Health, also known as the Add 
Health Survey, and this committee's interest in continued reporting on 
this study. We are pleased to provide some information in this 
testimony that focuses on Add Health, your interest in the decreasing 
rates in teen pregnancy and abortion, the Fatherhood Initiative, and 
the Family and Child Well-Being Research Network.
Add Health
    The Add Health survey is the first comprehensive national study of 
the social, psychological and environmental determinants of adolescent 
health. This study provides information that is valuable to parents, 
educators, researchers and policymakers. Although teens are generally a 
very healthy sub-group in the population, one in five has a serious 
health problem which are often costly and affect adult health. Each 
year, in the mid-1980's, the lifetime cost of injuries to young people 
15-24 years of age were estimated at $39.4 billion; public support for 
families headed by adolescents cost $16.7 billion per year; treatment 
costs for adolescents with mental health problems were estimated at 
$3.5 billion annually; and $2.0 billion or more per year was spent on 
facilities for delinquent adolescents.
    One of the key findings from the Add Health study was that ``family 
connectedness'' played a central role in protecting adolescent health: 
adolescents who felt loved and cared for by their parents and were 
satisfied with their family relationships were least likely to smoke, 
drink or use illegal drugs; least likely to become sexually active at a 
young age; least likely to be emotionally distressed or contemplate or 
attempt suicide, and least likely to engage in violence.
    Determining how to prevent and treat adolescent health problems 
will contribute to a stronger and healthier society. PAA and APC hope 
this committee will continue to support research, such as the Add 
Health study, that adds to our understanding of changes in the teenage 
and adult population.
Teen Pregnancy and Teen Abortion
    There are encouraging trends in teen pregnancy and the prevalence 
of abortion. The teen birth rate has been steadily decreasing in recent 
years. Since 1991 the rate has declined 12 percent to 54.7 per 1,000 in 
1996. Between 1991 and 1995, the teen birth rate dropped 17 percent 
among non-Hispanic blacks and by more than 9 percent among non-Hispanic 
whites. The teenage Hispanic population did not show a comparable 
decline in birth rates between 1991 and 1995. Another encouraging note 
is that there was a decline in the teen abortion rate in the early 
1990's. These data suggest that the decrease in the teen pregnancy rate 
is not being driven by an increase in abortion.
    Although rates of teen pregnancy are decreasing, the United States 
still has one of the highest teen pregnancy rates among industrialized 
countries. NICHD is currently supporting a study to identify key groups 
of young women who are at a higher risk of becoming a teen parent. One 
such group, younger sisters of pregnant and parenting teens, have more 
permissive childbearing attitudes than do their age and socio-economic 
status-matched peers who do not have an older sister who is a teen 
parent. Realization of this type of information will prove very 
important when creating intervention programs targeted at further 
decreasing the teenage pregnancy rate.
Fatherhood
    The declining significance of marriage has the particular effect of 
weakening the ties of men to women and children, with a resulting 
burden to the welfare system and to women and children themselves. 
Thus, it is important to understand the conditions which help to 
sustain men's obligations to family members. NICHD, in conjunction with 
the Federal interagency Forum on Child and Family Statistics and the 
National Center on Fathers and Families, launched a Fatherhood 
Initiative to review the capacity of the federal statistical system to 
conceptualize, measure and gather information from men about their 
fertility and role as fathers. This same study identified ways to 
improve data collection and research in this area.
Family and Child Well-Being Research Network
    Finally, we wanted to bring you up-to-date on NICHD's Family and 
Child Well-Being Research Network--an interdisciplinary data system 
focusing on child- and family-related research that relies on cross-
agency cooperation. The network is comprised of scientists from seven 
universities collaboratively working with federal officials from NICHD, 
the Office of the Assistant Secretary for Health, of the Department of 
Health and Human Services (DHHS), the Administration of Children and 
Families, of DHHS, the Census Bureau and the Department of Education. 
This network currently addresses a variety of questions about the 
interrelations between parent characteristics, family structure and 
organization, neighborhood attributes and different forms of social 
support. The network is committed to increasing the visibility of basic 
research findings to those involved in formulating public policy. 
Projects such as the Family and Child Well-Being Research Network 
perform the important task of helping synthesize research into sensible 
policy solutions.
    NICHD's Family and Child Well-Being Research Network, in 
cooperation with federal statistical agencies and the research 
community developed a comprehensive set of indicators of child well-
being. Information from these indices are published annually by 
executive order. The first report titled, America's Children: Key 
National Indicators of Well-Being, was released in 1997. This report 
provides a much improved information base that summarizes the changes 
in the overall well-being of American children and families on an 
annual basis.
    PAA and APC enthusiastically support initiatives such as NICHD's 
Family and Child Well-Being Research Network that provide quick access 
to data and are efficient and effective resources for policy-related 
research in cross-disciplinary fields.
The National Institute on Aging (NIA)
    The NIA also has a well established and widely respected 
demographic research program which provides crucial information on the 
implications of an aging of the American Population for our country. 
Currently, the NIA is funded at $519 million, with $38 million of that 
budget dedicated to demographic research--training, career development, 
and demographic, economic and epidemiologic research. As the US 
population ages and Congress contemplates changes in Medicare and 
Social Security, the demography of the elderly steadily become more 
important. The NIA has a strong history of supporting the collection of 
data which allows demographers to study questions of concern to 
policymakers. Chief among these are the NIA-supported studies, the 
Health and Retirement Study (HRS) and its auxiliary survey, the Asset 
and Health Dynamics of the Oldest-Old (AHEAD) study. You have been a 
solid supporter of these two studies over the years, Mr. Chairman, and 
we would like to express our gratitude for your support.
Health and Retirement Study (HRS)
    As you know, the HRS focuses on retirement decisions and includes 
data on disability, work history, health and health insurance, pensions 
and retirement plans and obligations to family that may bear on 
retirement decisions. Using HRS data, researchers are able to explore 
issues related to health, disability and labor force participation; 
prospects for economic security; cognitive changes, health insurance 
coverage in the decade before Medicare eligibility.
    HRS research conducted by economists at the University of 
Pennsylvania, for example, indicated that while pre-retirement savings 
appears to be substantial ($340,000 for the median household), the 
present value of Social security wealth accounts for a large share of 
average total wealth (about $145,000). To meet a post-retirement income 
target of 70-80 percent, an average couple in their mid-50's would have 
to save $10,700 each year until age 65. This would translate into a 
savings rate of 23 percent, far greater than typical savings rates in 
the U.S. Persons in poor health are even less well prepared for 
retirement, with only $5,000 in pension wealth and $80,000 in Social 
Security wealth.
Asset and Health Dynamics of the Oldest-Old (AHEAD)
    The companion survey of HRS, AHEAD, provides unique information on 
the dynamics of health, economic resources and health care services. 
The study provides badly needed data on the costs and burdens of 
chronic disease and the consequences for the extended family. Over 
time, AHEAD will provide data on how families redistribute their 
resources across generations, and how these flows interact with public 
sector transfers. Such a study is needed to make informed policy 
decisions on initiatives such as Medicare/Medicaid coverage for 
community long term care and health care reform.
    AHEAD data and research are also providing insights into the 
complex family support system which sustains persons of all ages in 
times of need. Despite the stereotype of the ``greedy geezer'', 
analyses of AHEAD indicate that financial transfers overwhelmingly flow 
from parents to children, even when the parents are very old. These 
transfers disproportionately target adult children in the family who 
are relatively less well off than their siblings. Adult children who 
benefit from such transfers, however, are far more likely to provide 
personal care as their parents become disabled in later life.
    HRS and AHEAD data also provide opportunities to track the 
cognitive performance of older persons as they age. In the total non-
institutionalized population age 70 and over, about 5 percent have 
severe cognitive impairment and another 48 percent score below average. 
As expected, persons of low education and limited financial resources 
are more likely to evidence cognitive deficits in middle and late life.
    Finally, PAA and APC are interested in and support the current 
efforts to strengthen the Federal Forum on Aging Related Statistics 
that coordinates data across federal agencies. The forum is an example 
of NIA's interest in supporting NIH's innovative endeavor of 
streamlining federal databases and making data accessible to 
researchers from varied fields.
    PAA and APC would like to thank you for the opportunity to present 
this information. Demographic data and research are important tools for 
policymakers that can both save public funds and promote more informed 
decision-making. If this vital research is to continue producing 
relevant and timely information, adequate funding and Congressional 
support are needed. The Population Association of America and the 
Association Population Centers support a 15 percent increase in funding 
to sustain the momentum of demographic research in the National 
Institutes of Health as part of the broadly based support to double the 
the funding for the NIH over the next 5 years.
                                 ______
                                 
   Prepared Statement of the American Association for Cancer Research
    The American Association for Cancer Research (AACR) is the premier 
professional association of basic, clinical, and translational cancer 
researchers. Its membership of 14,000 scientists is committed to the 
understanding, diagnosis, treatment, and prevention of cancer. The 
AACR's international headquarters is located in Philadelphia, 
Pennsylvania. We appreciate the opportunity to present a statement to 
the Committee Record on behalf of increased funding for cancer 
research.
    Cancer is a disease which devastates its victims. Based upon 
today's incidence rates, 42 percent of Americans alive today will 
develop cancer, and over 20 percent will die from this disease. 
Cancer's daily death toll is 1,550 people, one person every 57 seconds. 
To fully grasp the concept of cancer's death rate, imagine five Boeing 
747 jumbo jets crashing EVERY DAY for a year, and that will equal the 
number of Americans who die annually from cancer--over 565,000. In 
fact, the number of Americans who die of cancer each year exceeds all 
U.S. combat deaths in all of the wars in this century. This should 
shock the public into action; it should be our wake-up call. The 
ravages of cancer are not acceptable to those of us on the front lines 
of the fight against cancer, and especially not to its victims and 
their family members. Indeed, the human toll of this disease is painful 
to quantify.
    The AACR fully supports the priorities and programs articulated in 
the fiscal year 1999 ByPass Budget of the National Cancer Institute 
(NCI). We call on Congress to consider seriously the priorities 
outlined in this important document and to provide a funding level for 
the NCI of $3.1 billion in fiscal year 1999 in order to fully fund 
these opportunities for accelerated progress against cancer. The 1999 
ByPass Budget specifically outlines the following:
  --Extraordinary Opportunities in cancer genetics; preclinical models 
        of cancer; imaging technologies; developmental diagnostics; 
        and,
  --NCI Challenges which are to dramatically increase access to and 
        participate in clinical trials; enhance investigator-initiated 
        research; support and encourage clinical investigators; 
        restructure and expand NCI Cancer Centers; develop state of the 
        art informatics systems; study emerging trends; and increase 
        training and education.
    These priorities are vitally important to our national effort to 
conquer cancer. We need your support for the fiscal year 1999 ByPass 
Budget to fully pursue them.
    The importance of investments in scientific research has recently 
gained momentum in Washington. The AACR is encouraged by the Clinton 
Administration's proposal to increase cancer research spending at the 
National Institutes of Health (NIH) by 65 percent over the next 5 
years. The increase requested for the NCI is part of an unprecedented 
$1.5 billion increase requested by the Administration for NIH in fiscal 
year 1999. The AACR also supports Senator Specter's Resolution to 
increase the funds provided to the NIH this fiscal year by $2 billion--
in increase of 14.65 percent--and the AACR asks that you support the 
spirit of this Resolution as the Budget Committee develops its 
priorities, and when the Subcommittee marks up its fiscal year 1999 
bill. We recognize that, in order for you to support our request for 
increasing the appropriations to the NCI, it is important for you to 
understand what has been accomplished and what needs to be done now. 
The research community is committed to working with your colleagues in 
the leadership and on the Budget Committee to realize the potential 
advances outlined in the ByPass Budget.
    Twenty-five years ago the nation enacted legislation to wage a war 
against cancer, funding a program of research, establishing a network 
of cancer centers, and developing national programs to improve 
diagnosis and treatment. The progress made to date has been 
extraordinary. We have established a research infrastructure that is 
the envy of the world. We have attracted the best and brightest minds 
to the problem of cancer, and we have made research discoveries that we 
did not even think were possible when the National Cancer Act was 
passed.
    Our investment in basic research has produced unprecedented 
opportunities for advances on all fronts in our national war to 
eradicate cancer. These victories in basic research have often been 
difficult. Cancer has proven to be an extraordinarily complex disease 
that presents an ongoing challenge beyond what cancer researchers 
imagined 25 years ago. Significant progress has been made that has 
allowed us to cure certain types of cancer and has led to the 
development of new diagnostic, therapeutic, and prevention strategies 
for several other cancers. Researchers are beginning to understand the 
causes of cancer and also to make inroads into cancer control through 
new methods of screening high-risk individuals and advances in 
diagnosis. The battle against cancer is now turning in our favor, as 
demonstrated by the recent announcement of a decline in mortality of 
several cancers.
    Regrettably, at this, our moment of greatest potential, we are 
losing momentum. Just when the possibility of eliminating cancer has 
never been greater, we are facing a critical loss of national will. We 
are also faced by the grim reality that we have not fought the ``war'' 
that the public believes has been waged against cancer. In fact, there 
has only been a skirmish.
    A crisis of unprecedented proportions has developed and continues 
to threaten continued progress in research. The AACR believes that this 
crisis will block further progress and could even reverse past 
advances. While we recognize the extraordinary support that Congress 
has provided to cancer research in the past, our resources to combat 
this disease remain inadequate. The legacy of years of inadequate 
investment in basic, translational, and clinical cancer research--
combined with the devastating limitations that managed care has 
recently placed on clinical research and the declining support for 
young investigators is strangling the pace of discovery in basic 
research findings into effective treatments for people diagnosed with 
cancer.
    The cost of care for persons with cancer exceeds $107 billion 
annually, yet the research budget proposed for cancer is $2.7 billion. 
No company in America would stay in business with an investment in 
research and development that is less than 3 percent. No general would 
ever go to war with such limited resources. What a terrible irony that 
$61 billion was spent on the Gulf War and that a sizable proportion of 
that money was invested to ensure that no more than 10,000 Americans 
lost their lives, yet America tolerates 560,000 deaths from cancer 
every year. One person dies of cancer every 57 seconds. That is why the 
following points are so important.
    Research grants.--When the National Cancer Act was signed into law, 
40 percent of approved research grants were funded. This year, less 
than 23 percent of approved research grants will be funded. We reject 
far more approved research than we fund. As a result we can only afford 
to fund research that is a sure thing. We are unable to fund the 
innovative, high risk science which may have the greatest potential to 
significantly advance the frontiers of science or to fund the plodding, 
methodical, and costly translational studies needed to bring exciting 
advances out of the lab and to the cancer patient.
    Clinical research.--We believe that current levels of NCI funding 
remain an impediment to a fulsome clinical research enterprise. 
Certainly Congress has provided tremendous support for the NCI in the 
context of significant fiscal pressures over the past several years. 
However, we are gravely concerned about the shortage of physician-
scientists dedicated to clinical and translational research as well as 
those who are unable to obtain research funding and are leaving careers 
in academic medicine to pursue careers in clinical practice. Further, a 
predictable, sustainable budget that reflects a level of funding 
adequate to pursue the existing tremendous research opportunities is 
vital if we are to achieve the appropriate balance of basic and 
clinical research.
    Clinical trials offer the most promising therapy for cancers which 
have not been cured through standard therapies (commonly referred to by 
patients as ``slash, burn, and poison''). Yet, we accept the fact that 
our nation's programs of clinical research, which have led in the 
development of curative treatments for a few cancers, are stagnant or 
declining. It is unacceptable that only 2 percent of adults with cancer 
are actually treated on clinical trials that test the best available 
therapies.
    Translational research.--Translational research is less an entity 
unto itself than part of a process that may lead ultimately to general 
human applications. It is the bridge between progress in the laboratory 
and new methods of prevention, diagnosis, and treatment, and it is thus 
essential to progress against cancer. Translational research has been 
responsible for some of the most stunning clinical successes of this 
century, including the description of molecular mechanisms of colon 
cancer, the engineering of effective AIDS treatments, and the 
development of new treatments to reduce the side effects of 
chemotherapy, to name just a few. Unfortunately, however, as scientific 
complexity increases and, conversely, the complexity and often the 
toxicity of modern treatments escalate, the valley between those 
discovering molecular relationships in the laboratory and those who 
translate those discoveries into meaningful treatments has widened and 
deepened. The path to discovery is multifaceted, dependent on 
continuous productive interactions between basic and clinical 
scientists both in the laboratory and at the patient's bedside. Yet 
this highly innovative approach to research does not compete well in 
the current environment due to funding constraints.
    Tobacco.--For decades, the tobacco industry has denied that smoking 
is the major causative factor in lung and numerous other cancers. 
Researchers have now demonstrated that active tobacco smokers have a 
greater than 15-fold increase in their risk for lung cancer as compared 
with nonsmokers. Tobacco use is the cause of more than 160,000 cancer 
deaths each year in the United States and is responsible for about 30 
percent of all cancer deaths annually. In addition, smoking and other 
tobacco use have been determined to be a major cause of many other 
serious illnesses and deaths each year, most notably from cancers of 
the pharynx, larynx, esophagus, oral cavity, pancreas, bladder, and 
other organs.
    What has not been known until very recently is that former smokers 
continue to be at high risk for lung cancer for many years after 
smoking cessation because they carry long-term DNA damage in their 
lungs. It has been found that these DNA changes are associated with the 
development of cancer, that the changes persist for many years after 
smoking cessation, and that the lung tissue may never return to its 
normal state. Since DNA damage is absent from the lungs of lifetime 
nonsmokers, this leads to the conclusion that the changes observed in 
former smokers are directly related to their previous smoking. Those 
who have stopped smoking can remain from 1.5 to 4 times more likely 
than nonsmokers to develop lung cancer. In fact, over half of all lung 
cancers in the United States occur in former smokers.
    Therefore, the AACR urges Congress to ensure that public health 
funds obtained from the tobacco settlement are provided to the National 
Institutes of Health (NIH) and the NCI for additional peer-reviewed, 
national cancer research programs of the highest quality. It is highly 
appropriate that funds be provided from the tobacco settlement for 
research, and it is essential that the amount be consistent with the 
scope and gravity of this epidemic.
    Specifically, these new resources should be directed to the NCI in 
support of important priorities in basic, clinical, and translational 
cancer research. We ask Congress to ensure that the resources provided 
through the tobacco settlement will: markedly increase the cancer 
research budget of the NCI; underwrite the cost of participation in 
clinical research trials ontobacco-related cancers that will contribute 
to curative or preventive new therapies; and supplement, not supplant, 
current resources provided to the NIH and NCI.
    To exploit the research opportunities that exist and to build on 
the promising developments of just the last few years alone, the AACR 
believes that a real War on Cancer is now warranted. Congressional 
support of cancer research has been considerable over the past 25 years 
but far too much work remains to be done and our casualty rate is far 
too high. Without your leadership in support of our National Cancer 
Program, we will not be able to do our job at both laboratories and 
hospitals across the country.
    Thank you for the opportunity to present this statement.
                                 ______
                                 
    Prepared Statement of the College on Problems of Drug Dependence
    The College on Problems of Drug Dependence (CPDD) is the nation's 
longest standing organization that addresses the problems of drug 
dependence and drug abuse and the leading scientific society in the 
field of drug dependence research. CPDD urges the Committee's continued 
support of the National Institutes of Health (NIH), the National 
Institute on Drug Abuse (NIDA), and the Substance Abuse and Mental 
Health Services Administration (SAMHSA).
National Institute on Drug Abuse
    CPDD sincerely appreciates the almost unparalleled 7.6 percent 
increase provided to NIDA in this fiscal year 1998, and urges that the 
Committee increase this base in fiscal year 1999 to continue the 
ongoing peer-reviewed research funded by NIDA. Such research is 
essential for continuing to further our understanding of the etiology, 
prevention, and effective treatment of substance abuse problems.
    Despite these recent increased appropriations and encouraging 
decreases in certain categories of drug use, drug use trends remain 
mixed and more research is necessary to provide effective interventions 
to reduce overall illicit drug use and achieve the goals of the 
National Drug Control Strategy to reduce the prevalence by 50 percent 
by 2007. The 1997 Monitoring the Future Study found that illicit drug 
use among younger adolescents appears to be slowing. However, there 
were again increases in the fraction of twelfth graders using drugs 
such as marijuana, cocaine, LSD and cigarettes, and this population's 
increased use of drugs is particularly alarming as they are poised at 
the brink of exiting our school system, a means to monitoring youth 
drug use. As the Institute of Medicine recommended in their 1996 Report 
on Opportunities in Drug Abuse Research, there is a need for additional 
monitoring to provide more information about escalation to abuse and 
dependence. The inconsistencies in drug use patterns command our 
attention and demand that we continue to expand our efforts to identify 
and disseminate science-based information on the perils of drug use and 
the most effective practices for prevention and treatment. We must 
remember that drug abuse in fact is a preventable behavior.
    It is important for Congress to recognize that research is 
essential to produce significant and long lasting changes in drug use. 
We have learned a lot about the causes of drug abuse, and our latest 
treatment advances reflect some of that knowledge. Some of what leads 
people to abuse drugs is inherited from their parents. Availability of 
drugs is also an important determinant of initial use, but much less 
important to addicts, though even they turn out to be somewhat 
sensitive to the price. We are also learning about the increased risk 
for drug abuse which children with certain types of psychiatric and 
behavioral problems have and the need to treat these disorders if we 
are going to prevent substance abuse problems. Something happens to the 
brains of people who use drugs regularly. We are learning a tremendous 
amount about this, taking advantage of some of the latest techniques 
from the neuroscience. Indeed, drug abuse research is coming of age. 
NIDA was established just over two decades ago. It funds virtually all 
drug abuse research in the United States and more than 85 percent of 
all drug abuse research worldwide, few other governments support this 
research. There is little pharmaceutical industry research in this area 
and few foundations support any basic research, since the market 
potential for medications in this area is fairly modest. As the 
Institute of Medicine Reported in 1996, ``The field is on the threshold 
of significant advances and a sustained research effort will strengthen 
society's capacity to reduce drug abuse and ameliorate its adverse 
consequences.''
    Great strides are being made in understanding the causes of drug 
abuse, and the scientific community relies upon NIDA's support. 
Researchers now have the ability to show in detail what drugs are 
actually doing to and in the brain--we can actually visualize as it 
happens where drugs are binding in the brain. We have discovered the 
specific brain circuits involved in drug use and we are beginning to 
unveil the changes in activity patterns in these circuits during the 
processes of addiction and withdrawal. Researchers have identified the 
genes for the receptor sites for practically every illegal substance. 
The next step is to develop new addiction medications. NIDA devotes 
about $80 million of its budget to drug development. We rely upon this 
investment which is not complemented by industry sponsored research; 
NIDA's support in this arena is unparalleled and therefore all the more 
vital.
    To build upon these and other past breakthroughs and to exploit the 
opportunities that exist, CPDD recommends additional research in the 
following broad areas:
    Increase basic drug abuse research.--The explosion of new 
information in neuropharmacology and other neuroscience has the 
potential to provide major breakthroughs in drug abuse treatment and 
prevention. We need to better understand the role of heredity and other 
sources of individual differences as risk factors for drug abuse. We 
also need additional information on the harmful effects of acute and 
chronic exposure to drugs of abuse.
    Maintain and expand our knowledge of trends in drug abuse 
practices.--Continued support is needed for large scale surveys that 
provide an informed public policy. We need better access to existing 
data, which would facilitate our understanding of drug abuse and its 
consequences; we need improved methods for obtaining scientific data on 
newly emerging drug abuse problems; and we need to support more long-
term prospective studies on risk factors that co-vary with the 
development of drug abuse problems. Large scare ethnographic studies 
funded by NIDA play a vital role here. These should lead to the 
development of more comprehensive and systematic surveillance of young 
adult populations.
    Increase research on the effectiveness of drug abuse prevention and 
public policy initiatives aimed at reducing demand for drugs among our 
youth.--The DARE program has been widely implemented despite adverse 
evaluations in part because there is a dearth of alternative programs 
that have moved beyond the initial pilot evaluation stage. Effective 
prevention programs must be based upon an understanding of the causes 
of drug experimentation and even more critically on the escalation from 
drug experimentation to drug abuse and dependence. Additional research 
is also needed on prevention programs for high risk youth and on the 
general patterns of termination and escalation.
    Increase research on the development of new drug abuse treatments 
and on the evaluation of existing treatments.--Improved treatment 
strategies that combine the use of medications and behavioral 
treatments are needed, as are new treatments that reduce relapse. We 
also need additional evaluations of treatment effectiveness for special 
populations. For example, what are the best ways to link drug abuse 
treatment to the criminal justice system, in order to take maximal 
advantage of the leverage of criminal sanctions?
    Increase research on the relationship between drug abuse and the 
transmission of AIDS.--We need a better understanding of how drugs 
alter the likelihood of risk-taking behaviors that increase HIV 
transmission since an estimated one-third of HIV cases result from drug 
use, and we need improved treatments targeted to the abuse of drugs by 
persons who are infected with the HIV virus. Further, we need a better 
understanding of the effects of drug abuse on the immune system in 
order to better prevent and treat AIDS and its associated opportunistic 
infections.
    The College on Problems of Drug Dependence also recognizes the 
public interest in reducing tobacco use, particularly youth tobacco 
use, as evidenced by the June 1997 draft global tobacco settlement. 
Despite Congressional attention to this issue as articulated by the 
profusion of tobacco related bills pending action by the 105th 
Congress, we recognize the political roadblocks to codification of a 
tobacco settlement. If the public health goals of both the June 20, 
1997 proposal and the pending legislation are to be attained, a vast 
amount of research must be done, and should be funded as soon as is 
possible. Your support for NIDA is vital as current prevention and 
treatment programs are not powerful enough to assure that, even with 
adequate program funding, the goal of reducing adolescent cigarette use 
rates by 60 percent within ten years can be achieved or that most 
current smokers will quit within the next decade. Modern research has 
provided a much better understanding of the etiology and health 
consequences of tobacco consumption, and the basic biological effects 
of nicotine and other tobacco ingredients. The combination of large 
scale epidemiological studies and laboratory research have been 
critical in creating a public awareness of the dangers of smoking and 
have indeed forced the tobacco companies to accept their responsibility 
for a public health disaster of the first order. Health scientists have 
established that tobacco use can become addictive; this is the 
cornerstone to the proposed regulation of nicotine by the FDA and an 
aspect of the settlement strongly supported by the College. NIDA 
funding provided the initial research leading to the development of 
nicotine replacement medication and NIDA and other NIH institutes have 
supported research that has improved the efficacy of gums and patches. 
These advances have enabled large numbers of Americans to give up 
tobacco smoking.
    Whatever else emerges from the settlement discussions, two 
scientific aims are important:
    We need to develop better tools for monitoring use patterns so we 
have adequate and reliable performance measures for compliance with or 
achievement of the goals of any settlement. The Monitoring the Future 
and Youth Risk Behavior surveys are not sufficient on their own. This 
matter needs to be studied carefully.
    FDA and NIDA should work together to help develop the scientific 
foundation, now lacking, for even thinking about regulating nicotine in 
tobacco products.
Substance Abuse and Mental Health Services Administration
    The research dissemination and training programs of the Substance 
Abuse and Mental Health Services Administration (SAMHSA) are also an 
essential part of our national drug abuse treatment and prevention 
strategy. We are especially supportive of the training and 
demonstration grant functions of the Center for Substance Abuse 
Treatment (CSAT) and the Center for Substance Abuse Prevention (CSAP).
    Much more needs to be done to determine the feasibility of 
implementing NIDA-supported research advances in community prevention 
and treatment programs. There is a tremendous gap between what is known 
about prevention and treatment effectiveness and what is actually being 
done in many communities. We need more research on the barriers to the 
implementation of effective new treatment and prevention programs. The 
treatments and the prevention strategies that emerge from NIDA-
supported research require community-based programs to evaluate their 
effectiveness. CSAT and CSAP demonstration grants provide a critical 
link between research and its implementation. Furthermore, SAMHSA 
training programs are needed to insure that counselors, educators, and 
other professionals have the necessary knowledge of new advances in the 
field. The large cut that these programs experienced in fiscal year 
1996 have severely curtailed their effectiveness.
Funding request
    CPDD urges the committee to provide the highest possible increase 
for NIDA in fiscal year 1999. Further, the College on Problems of Drug 
Dependence supports the Ad Hoc Group for Medical Research Funding's 
proposal to increase funding for the NIH overall by 15 percent this 
fiscal year, as the first step toward doubling the budget over five 
years. Similarly, we encourage continued support for SAMHSA, and 
request that adequate support be provided for the demonstration and 
training programs supported by CSAT and CSAP.
    Thank you for the opportunity to submit the views of the College on 
Drug Dependence.
                                 ______
                                 
        Prepared Statement of the Research Society on Alcoholism
                    fiscal year 1999 recommendation
    The Research Society on Alcoholism (RSA) is a professional research 
society whose 1,200 members conduct basic, clinical research and 
psychosocial research on alcoholism and alcohol abuse.
    Alcoholism is a tragedy that touches all Americans. One in ten 
Americans will suffer from alcoholism or alcohol abuse, but their 
drinking will impact on the family, the community, and society as a 
whole. Alcohol is a factor in 50 percent of all homicides, 40 percent 
of motor vehicle fatalities, 30 percent of all suicides, and 30 percent 
of all accidental deaths. Every American is affected and all Americans 
bear the cost. Children exposed to alcohol during pregnancy are 
afflicted with birth defects and mental retardation. Nearly 7 million 
children live with an alcoholic parent, often in chaotic homes where 
they suffer physical and emotional abuse.
    Alcoholism and alcohol abuse cost the nation nearly $100 billion 
annually. One tenth of this pays for treatment; the rest is the cost of 
lost productivity, accidents, violence, and premature death. 
Prohibition did not solve the problem of alcoholism, and current 
therapy is simply not good enough. Only research holds the promise of 
effective prevention and treatment of alcoholism; however, alcohol 
research is woefully underfunded. The National Institute on Alcohol 
Abuse and Alcoholism (NIAAA) funds over 90 percent of all alcohol 
research conducted in the United States. For 1998, the budget of the 
National Institute on Alcohol Abuse and Alcoholism (NIAAA) is $227 
million. We are committing to alcohol research only $2 for every $1,000 
lost from alcohol abuse and alcoholism and only $12 for every affected 
individual. In 1997, NIAAA could fund just 25 percent of all grant 
applications; the comparable figure for NIH is 29 percent.
    The inability to fund outstanding grant applications comes at a 
time of unprecedented opportunities in alcohol research. In the next 
few months you will learn of important new findings on the genetics of 
alcoholism. For the first time scientists, funded by the NIAAA 
Collaborative Study on the Genetics of Alcoholism (COGA), have 
identified discrete regions of the human genome that contribute to the 
heritability of alcoholism. This first success in the genetic mapping 
of a complex biological and behavioral disorder must be followed by an 
expensive, labor intensive effort to pinpoint and identify the genes of 
interest. Armed with this knowledge, health providers may one day be 
able to identify individuals at risk and target these individuals for 
prevention programs. Genetic research will accelerate the rational 
design of drugs to treat alcoholism and may improve our understanding 
of the interaction between heredity and environment in the development 
of alcoholism.
    One of the most promising areas of alcohol research is in the field 
of neuroscience. The development of effective drug therapies for 
alcoholism requires an improved understanding of how alcohol changes 
brain function to produce craving, loss of control, tolerance, and the 
alcohol withdrawal syndrome. Naltrexone, a drug that blocks the brain's 
natural opiates, reduces craving for alcohol and helps maintain 
abstinence. Ongoing clinical trials will help determine which patients 
benefit most from naltrexone and how the drug can best be used. Another 
promising drug, acomprosate, has proven effective in European trials 
and is undergoing evaluation in the United States.
    One of the most tragic consequences of alcoholism is Fetal Alcohol 
Syndrome (FAS). FAS is a permanent condition characterized by mental 
retardation, small size, behavioral problems, and specific facial 
abnormalities. Fetal alcohol syndrome is the most common, preventable 
cause of mental retardation in the United States. If pregnant women did 
not drink, there would be no fetal alcohol syndrome; however, as we 
know too well, many individuals cannot stop drinking, even when the 
consequences are well known.
    From animal studies we have learned that alcohol's effects during 
pregnancy depend on the timing, pattern, and amount of alcohol intake. 
Magnetic resonance imaging, brain wave recordings, and behavioral 
assessments of affected children have identified specific changes in 
brain structure and function that result from heavy prenatal alcohol 
exposure. A better understanding of alcohol's effects on the developing 
brain will allow us to better target the treatment of exposed people. 
This research will allow those with FAS to maximize their potential and 
circumvent some of their deficits. An improved understanding of risk 
factors will help us target and prevent FAS.
    Recent research has shown that even light drinking during pregnancy 
can interrupt normal development. Consequently, most researchers 
recommend that pregnant women abstain totally from drinking. In the 
laboratory, it has been shown that low doses of alcohol can interfere 
with normal processes of development. We are optimistic that 
understanding the mechanism by which alcohol disrupts fetal development 
will lead to effective strategies for reducing deficiencies associated 
with FAS.
    Alcohol abuse and alcoholism are devastating problems of national 
importance. Alcohol research has now reached a critical juncture, and 
the scientific opportunities are numerous. With the continued support 
of this Committee and the Congress, we are optimistic that the next few 
years will bring significant advances in alcohol research.
    Recommendation.--The Research Society on Alcoholism requests that 
funding for NIAAA in fiscal year 1999 be increased by $34 million (15 
percent) to $261 million. This request balances the impact of the 
disease and the abundance of research opportunities.
                                 ______
                                 
  Prepared Statement of Heather R. Fraser, Cystic Fibrosis Foundation
    On behalf of the 30,000 children and young adults with cystic 
fibrosis (CF) in this country, the Cystic Fibrosis Foundation (CFF) is 
pleased to submit public witness testimony to support fiscal year 1999 
appropriations for the National Institutes of Health (NIH). The 
Foundation applauds this Subcommittee for the CF-specific language 
included in the Appropriations Bill last year. Your collective vote of 
confidence in the NIH served to make the future for me, and many other 
individuals with this disease, much brighter.
    Four years ago, my health status was in a radical state of decline. 
On average, I was hospitalized every four months to receive IV 
antibiotic therapy to treat recurrent respiratory tract infections. 
Then Pulmozyme, the first new drug in 30 years designed 
specifically to CF patients, was made available in January of 1994. I 
felt as though I had been given a new lease on life. Suddenly, I had 
more energy to do what I was used to doing, and even some ``reserve'' 
to do things I had previously been unable to accomplish. And yet, for 
all its merit, Pulmozyme could only do so much to protect my 
lungs from the nemesis of chronic infection. Over time, my respiratory 
status resumed its downward course. Oral antibiotics continued to 
become less and less effective. And just when it seemed as though I was 
losing my battle against this insidious disease, the aerosolized 
antibiotic TOBI--was approved.
    Over dramatization? No way--over exuberance, coupled with the 
utmost gratitude for the scientists and clinicians that helped bring 
this drug to fruition. They gave me and many others with this disease 
the greatest gift in the world--time. I know TOBI--is not a ``forever 
fix'' and am sobered by the reality that my pulmonary status will again 
one day require stronger therapeutic intervention. What will my 
armament be then? This year, you will hear testimony punctuating the 
need for increased federal funding for many entities, including medical 
research. It is my hope that one day there is not going to be the need 
for extensive deliberation--not because an infinite pool of resources 
has suddenly become available, but because a portion of that need has 
been eliminated. For individuals with CF, this will occur the day 
researchers correct CF cells permanently. The Foundation is counting on 
your continued investment to write the final chapter of our success 
story.
    The CFF urges the House of Representatives to concur with the 
President's recommendation to double the funding for the NIH over the 
next five years and, as a down payment on this commitment, provide an 
increase of at least 15 percent in fiscal year 1999. We request your 
continued support of the full spectrum of research--basic, clinical, 
and translational--sponsored by the National Institute on Diabetes, 
Digestive, and Kidney Disorders (NIDDK) and the National Heart, Lung, 
and Blood Institute (NHLBI). The resource capacity of these two 
Institutes is of paramount importance to propel the frontiers of CF 
research into the new millennium. The CFF believes this funding level 
is justifiable and an appropriate allocation, given the clear and 
pressing research opportunities which exist.
    Current success rates enable funding of a little more than two out 
of every 10 approved research grants.--In essence, this biomedical 
research policy allows us to open only two out of every ten ``doors of 
opportunity.'' This is unconscionable, and one cannot help to wonder 
what progress could emerge and how many lives would be saved if all 
these meritorious projects were funded. At a minimum, 50 percent of the 
approved research projects must be funded by the NIH in fiscal year 
1999.
    Support to General Clinical Research Centers (GCRC) to translate 
research progress from test tube to bedside must be increased.--These 
74 centers are specifically equipped to provide support to clinically 
trained investigators to examine disease conditions and to access new 
therapies. With the advent of managed care and the increasing 
constraints that academic medical centers are operating under, more and 
more ancillary costs for clinical trials are being passed on to GCRCs. 
GCRCs are pivotal to the identification of new therapies to treat and 
eventually cure CF and other life-threatening diseases. For viability 
to be sustained, there needs to be an increase of at least 15 percent 
provided to these centers.
    The NIH has a clear and important role in translational and 
clinical research. The Foundation recently completed a study looking at 
the therapeutic benefits of high-dose levels of ibuprofen to reduce 
airway inflammation in the prophylactic management of CF. This is a 
study that the private sector would not have undertaken due to the 
modest rate of return, but nonetheless was an important clinical 
research initiative to the CF population. The NIH must have the 
resources to explore these types of clinical research opportunities.
    Further, we ask this Subcommittee to direct the NIDDK, NHLBI, and 
the National Center for Research Resources to develop key mechanisms to 
assure rapid translation of basic research into new therapeutic 
interventions. While we applaud the acquisition of new knowledge 
through current programs at the NIH, a mechanism must be created to 
nurture clinical research. Creative development of an institutional 
infrastructure, similar to that already in existence to support basic 
research in teaching institutions, should be created to support and 
monitor ongoing clinical trial investigations.
    The NIH has an incredible track record in developing basic research 
and understanding of cellular processes. However, it is naive to think 
that the pharmaceutical and biotechnology industries are prepared to 
lead the effort to take this newly acquired knowledge and follow it 
through to clinical evaluation. Unless there is a permanent mechanism 
in place, drug development opportunities, along with many lives, will 
be lost.
    Clinical research training opportunities must be expanded.--A cadre 
of well-trained clinical investigators is vital to further progress 
made in the research laboratory, and to translate that progress to 
patients. Never before has the need been more urgent and the number of 
candidates so small. Additional initiatives in post-doctoral training, 
support for new and young investigators, and programs to facilitate the 
mentoring of these individuals are pressing priorities. Simply, we 
stand to lose the next generation of clinical scientists. There must be 
opportunities present to allow clinical scientists to obtain support 
for their research endeavors. This must occur at both the program 
level, with funding provided for clinical research, and the review 
level, to ensure that individuals familiar with clinical research will 
review and evaluate clinical research proposals.
    The current research infrastructure must also be updated to 
maximize the progress of an expanded national research enterprise.--
Research management costs must be adjusted proportionately to support 
intramural program operations and provide training for scientific 
program officers. Institutional research capacity is critical and thus, 
enhanced resources must also be directed toward extramural facilities, 
state-of-the-art equipment and instrumentation, and computer 
technologies.
    The NIH and Cystic Fibrosis Foundation continue to work together to 
provide a base for leadership in this country that is unparalleled. As 
a Foundation, we understand current funding constraints and that 
federal programs--regardless of their merit--have been placed in 
competitive positions. However at the end of a day, when I retreat home 
exhausted, in part due to work but more worn out as a result of dealing 
with the daily rigors that are the unwelcome hallmark of this disease, 
that cavalier acceptance is just not justified.
    Sadly, there will be casualties at the close of this debate. 
Nevertheless, we must work together to ensure that the human cost is 
kept to a minimum. This can clearly be accomplished by a guaranteed 
investment in biomedical research. On behalf of the Cystic Fibrosis 
Foundation, I close by urging this Congress to seriously consider the 
President's recommendation to double NIH appropriations over five 
years, and provide a 15 percent increase in funding for fiscal year 
1999.
    Thank you.
                                 ______
                                 
    Prepared Statement of the Joint Council of Allergy, Asthma, and 
                               Immunology
    The Joint Council of Allergy, Asthma, and Immunology (JCAAI) is 
pleased to submit public witness testimony in support of fiscal year 
1999 appropriations for allergy, asthma and immunology programs 
supported by the National Institutes of Health (NIH). These programs 
are supported primarily in two of the NIH Institutes: the National 
Institute of Allergy and Infectious Diseases (NIAID) and the National 
Heart, Lung and Blood Institute (NHLBI). The JCAAI is a professional, 
nonprofit organization comprised of the American Academy of Allergy, 
Asthma and Immunology and the American College of Allergy, Asthma and 
Immunology, and it consists of more than 4,000 researchers and 
clinicians who are dedicated to providing care for the 50 million 
Americans who suffer from allergic or immune disorders.
    First, we would like to express our appreciation for the tremendous 
support this Committee has provided to the NIH during the past two 
years. We know that you have been faced with tremendous budget 
constraints and we sincerely appreciate your making the NIH a priority 
for funding increases. We urge your continued leadership for NIH and 
for the allergy, asthma, and immunology programs supported by the NIAID 
and the NHLBI. Further, we are supportive of the legislative proposals 
that have been proffered to double the budget of the NIH, such as Sen. 
Res. 170. We have encouraged our members to educate their elected 
officials to obtain the broadest base of support in Congress to achieve 
this important objective.
    The JCAAI supports the Ad Hoc Group for Medical Research Funding 
proposal to double the budget for the National Institutes of Health 
over the next five years. Our national research enterprise is poised to 
make significant strides if the necessary funds are available to pursue 
the scientific opportunities, preserve the integrity of the research 
infrastructure, and adequately support and mentor physician 
investigators as the health care marketplace dramatically alters.
Asthma and allergic diseases
    Allergic diseases, including asthma, afflict twenty percent of 
Americans. The term allergic diseases describes a myriad of medical 
conditions such as asthma, allergic rhinitis, atopic dermatitis, food 
allergies and anaphylaxis. Asthma alone afflicts 14 million Americans, 
the prevalence is on the increase and the associated economic costs of 
this disease are quite significant.
    In 1999, the NIAID will renew the Asthma, Allergic and Immunologic 
Diseases Cooperative Research Centers. These centers provide an 
infrastructure and collaborative environment to study the complex 
problems associated with asthma, allergic and immunologic diseases. An 
important object of these research centers is to integrate basic and 
clinical research initiatives to improve the diagnosis, prevention, and 
treatment of these diseases.
    Allergic diseases.--Allergic rhinitis (hay fever) alone affects as 
many as 35 million Americans and is the most common chronic disease. 
Food allergies and food intolerances are also a major problem. Eight 
percent of children under six years of age experience food 
intolerances.
    Allergic reactions can be minor, such as reactions to pollen, mold, 
or dust, or they can be severe and potentially fatal, such as reactions 
to penicillin, insect venom, or allergic reactions to food. As many as 
2 million people experience severe reactions to insect stings every 
year, and many experts believe life-threatening allergic reactions to 
food may occur just as frequently.
    Research.--A variety of therapies have been developed to treat 
allergies, but researchers still do not fully understand certain 
critical aspects of allergies. When an allergic individual comes in 
contact with an allergen (the allergy-provoking substance), immune 
system cells produce an unusual type of antibody known as 
immunoglobulin E, or IgE, which starts the allergic reaction. 
Researchers are attempting how to comprehend how the immune system 
recognizes an allergen, why some people have a more severe reaction to 
an allergen, and what factors, including environmental and genetic, 
might be responsible for allergic diseases.
    NIAID-supported researchers are among the leaders in the study of 
allergies. For example, they identified the IgE antibody and they have 
identified the structure of the IgE receptor. By blocking the activity 
of the receptor, researchers may be able to provide a new therapy for 
allergies. NIAID-supported research has also demonstrated that DNA 
vaccines are capable of stimulating an immune response that may 
diminish allergy symptoms. Such vaccines could provide a more potent, 
consistent, and convenient treatment than the current therapy of 
allergy shots.
    Asthma.--Asthma is a major health problem. As many as 15 million 
people in the U.S. have asthma, and the number of people with self-
reported asthma increased from 10.4 million in 1990 to 14.6 million in 
1994. The actual number of asthmatics may be higher--asthma is 
sometimes difficult to diagnose because it often resembles other 
respiratory problems such as emphysema. Children have a 41 percent 
higher prevalence of asthma than that of the general population and an 
estimated 4.8 million children under age 18 have asthma. It is the most 
common chronic disease in children, and it is one of the most common 
reasons for missed days of school (parents are also forced to miss work 
to care for their asthmatic child). Recent research has identified that 
very early exposure to asthma-causing agents, in infancy or prior to 
birth, may determine a child's chance of developing asthma. Further, 
clinical and epidemiological data suggest that viral respiratory 
infections and exposure to allergens are the most important risk factor 
early in life that may lead to wheezing, prolonged alterations in 
airway function and chronic asthma.
    Asthma is approximately 25 percent more prevalent in African-
American children than in Caucasian children, and asthmatic African-
American children experience more severe disability and have more 
frequent hospitalizations than their Caucasian counterparts. In 1993, 
African-Americans aged 5 to 14 were four times more likely to die from 
asthma than Caucasians, and those aged 0 to 4 were six times more 
likely to die from asthma. Asthma is also more prevalent in African-
American adults than in Caucasians. Their hospitalization rate in 1992 
was 400 percent higher than for Caucasians and their age-adjusted 
mortality rate was 300 percent higher. The reason for the higher 
incidence is uncertain; however, lack of access to proper medical care 
is related to the poor outcomes.
    Direct and indirect costs for asthma were an estimated $6.2 billion 
in 1990, 43 percent of which was associated with emergency room use, 
hospitalization, and death. Inpatient hospital costs represented the 
largest single direct expenditure, totalling $1.6 billion, and 
emergency room use cost another $295 million. In 1993, asthma was the 
first-listed diagnosis in 468,000 hospital admissions and asthmatic 
children under age 15 experienced 159,000 hospitalizations (asthma is 
the leading cause of hospitalization of children).
    Research.--Asthma varies from person to person--symptoms range from 
mild to severe. While there is not a cure for asthma, it can be 
controlled with proper measures, including medications, learning to 
manage episodes, and learning to identify and avoid what triggers an 
episode. Triggers include controlling irritants in the air--90 percent 
of children with asthma and half of adult asthmatics have allergies; 
avoiding excess physical exertion; and managing emotions. Medications 
consist of anti-allergy drugs, corticosteroids, and bronchodilators.
    In August 1996, researchers (Weinstein, et. al.) published a report 
that summarized the results of a study to examine the economic impact 
of a short-term inpatient hospitalization program for children with 
severe asthma. The program, based in part on programs developed by 
NHLBI, significantly reduced inpatient and emergency care days for the 
subsequent 4 years of follow-up. In a study of 59 children, the median 
of 7 inpatient days the year prior to rehabilitation was reduced to 
zero (0) days during each of the following 4 years. Emergency care 
visits were reduced from 4 in the year prior to rehabilitation to zero. 
The year before rehabilitation, medication charges as a percentage of 
medical charges was 9 percent; by the third and fourth years of follow-
up they were 45 percent of total medical charges.
    The NIAID National Cooperative Inner-City Asthma Study has designed 
new strategies to reduce asthma morbidity and mortality. The first 
phase of the study looked at over 1,500 children and discovered factors 
including high levels of indoor allergen, especially cockroach allergen 
(the leading asthma-producing material that children were exposed to), 
high levels of smoking among family members; and exposure to high 
levels of nitrogen dioxide. In the second phase, 1,000 high risk 
children and their families were assisted by a nurse practitioner in 
managing the child's condition and instituting environmental controls. 
This resulted in significant reduction in asthma symptoms, improved 
school attendance, and a 30 percent decrease in asthma-related 
hospitalizations and unscheduled physician and emergency room visits. 
The NIAID has continued the study to disseminate the results.
Research enterprise
    The JCAAI is gravely concerned about the integrity of our research 
environment. In July, the Journal of the American Medical Association 
published an article entitled ``Preventing the Extinction of the 
Clinical Research Ecosystem.'' The authors made recommendations 
regarding the appropriate steps that must be undertaken if we are to 
preserve our national capacity to translate research findings from the 
laboratory to the patient. A strong cadre of highly trained, expert 
clinical scientists are key to achieving that objective, and this cadre 
of experts is presently threatened. It is imperative that we move 
forward in addressing the following: establishing a process for setting 
broad goals in clinical research; provide additional resources for 
clinical research; restructure the approach to clinical research 
training to maximize the entry of talent into the field of clinical 
research; and, provide resources for clinical investigators to maintain 
clinical, laboratory and patient care responsibilities.
    We recommend that Congress consider these priorities as you develop 
your funding recommendations for fiscal year 1999.
Summary
    Allergies and asthma are serious health problems, affecting 
millions of Americans in both acute and chronic forms. Through research 
supported by the NHLBI and NIAID, researchers and clinicians have 
learned much about how to diagnose and treat these diseases, but much 
more remains to be done. The JCAAI requests a 9 percent increase for 
the NIH in fiscal year 1998 to explore some of the exciting research 
opportunities that exist in these areas.
    Thank you for your consideration of our request.
                                 ______
                                 
    Prepared Statement of the National Coalition for Cancer Research
    On behalf of the 22 organizations of the NCCR, a coalition of 
organizations dedicated to cancer research, please accept this 
testimony to the Committee record. The NCCR is comprised of 22 not-for-
profit lay and professional organizations devoted to the pursuit of 
cancer research. These organizations which consist of 55,000 cancer 
researchers, nurses, physicians, and health care workers; tens of 
thousands of cancer survivors and their families; 40,000 children with 
cancer and their families; 82 cancer hospitals and cancer centers 
across the country; and more than 2 million volunteers, and on their 
behalf I appear before you today in support of the National Institutes 
of Health and the National Cancer Institute.
    Let me say at the outset, that the NCCR recognizes the commitment 
this Subcommittee has demonstrated in the past to cancer research. We 
understand the real funding constraints you are under and have already 
written to the House and Senate Budget and Appropriations Committee 
Chairmen asking that they enable you to provide the NCI with an 
increase by first increasing the health function of the Congressional 
Budget and subsequently by providing your Subcommittee with the 
increased allocation necessary to achieve this goal.
    The indispensable and long-term value of investing in scientific 
research today has recently gained momentum here in Washington. The 
NCCR is encouraged by the Clinton administration's initiative to 
increase cancer research spending at the National Institutes of Health 
by 65 percent over the next five years. The increase requested for the 
NCI is part of an unprecedented $1.5 billion increase requested by the 
Administration for NIH in fiscal year 1999. The NCCR commends Senator 
Specter's Resolution to increase the funds provided to the NIH this 
fiscal year by $2 billion, an increase of 14.65 percent, and asks that 
you support the spirit of this Resolution when the Subcommittee marks 
up its fiscal year 1999 bill. But for you to consider our request for 
increasing the appropriation to the National Cancer Institute, it is 
important that you understand what has been accomplished, and what 
needs to be done now, and that we as a community are committed to 
working with your colleagues in the leadership and on the Budget 
Committee to realize these gains.
    In 1972, we conceptualized a great endeavor--a War on Cancer. 
President Nixon pledged the full resources of our government to conquer 
this dreaded disease. Unfortunately, only limited research funding 
trickled out and we supported only a small skirmish. This was not an 
American-style effort to go to the moon, to crack the atom, or to fight 
a Gulf War. This effort could only support a few thousand investigators 
to fight only a limited engagement. Still, six cancers were essentially 
cured, including those that primarily affect young people, such as 
leukemia and testicular cancer. However, today the big six cancer 
killers (lung, breast, colon, prostate, bladder, and brain cancer) 
continue to ravage the bodies of their victims. Now, 25 years after 
this country pledged to go to war against cancer, one half of all 
American men and one third of all American women will be struck by the 
horror of being diagnosed with cancer during their lifetimes. One 
fourth of all Americans will one day die from this most unpleasant and 
painful disease. During the approximately 2\1/2\ hour period that this 
hearing will be in session, 161 Americans will die from cancer, 
compared with 11 who will die from AIDS and 7 who will be murdered. It 
would take 5 Boeing 747 jumbo jets crashing EVERY DAY for a year to 
equal the half million Americans who die each year from cancer. This 
number of cancer deaths per year exceeds all U.S. combat deaths in all 
of the wars in this century. This carnage on our people from cancer 
must stop, and it can, with research funded by this Congress. In the 
past, medical research has conquered the pain of amputation, surgery, 
and dental procedures, as well as infectious diseases such as typhoid 
fever and pneumonia; one day, medical research will conquer AIDS and 
cancer. We have already proved that we can cure six cancers through 
medical research; now it is time to eradicate the other major cancers. 
However, this will be slow to be realized at the current funding 
levels, when only one penny out of every ten tax dollars is spent to 
research this tremendously costly disease. If we doubled our effort on 
cancer today, it would still cost less than one-third of our space 
effort and only one-twentieth of the cost of the Gulf War. Taxpayers 
are far more endangered by a ``berserk'' cancer cell than by a bullet 
from an enemy, and they want to be protected against cancer.
    No one can predict when or where cures or successful prevention 
strategies will originate, but all agree that they will only come from 
funding a large base of investigations. At present the cancer research 
cup is three-fourths empty. Of every 100 grants approved for funding 
after critical peer review, less than 25 will receive funding. The 
other 75 unfunded projects represent lost opportunity, valuable time in 
the fight against cancer, and more lives lost.
    Health care costs for cancer exceed $107 billion annually and over 
half of the medical costs of cancer are due to the treatment of breast, 
lung and prostate cancers. However, we only invest about 2 percent of 
cancer's health care costs in research to find effective prevention 
measures, treatments and cures for cancer. The federal research budget 
for cancer is only $2.5 billion. Even the National Cancer Institute's 
Bypass Budget request of $3.191 billion, which the NCCR supports, is a 
conservative investment when contrasted with the $100 billion that will 
be expended in care.
    It is the NCCR's central conviction that the solution to the 
complex problems surrounding cancer--the reduction in morbidity, 
mortality, and the high costs of medical care--will come in a stepwise 
manner from the generation of new knowledge through research. The NCCR 
entreats you to exert your leadership and provided an unparalleled 
increase to the NCI, full funding of the NCI's Bypass Budget request of 
$3.191 billion, a 25 percent increase over the current fiscal year. At 
a minimum, the NCCR supports the Ad Hoc Group for Medical Research 
Funding's proposal that you increase funding for the NIH overall by 15 
percent this fiscal year, as the first step toward doubling the budget 
over five years. As stated, the NCCR supports the Congressional 
leadership demonstrated in Senate Resolution 170 to increase by 14.65 
percent the budget of the National Institutes of Health, including the 
National Cancer Institute, and we appreciate the President's request to 
increase funding for cancer research across the Institutes by 10 
percent and the NCI by 9 percent. But to equitably fund science, we 
must rely upon the expert recommendations of scientists, and the Bypass 
Budget request of the NCI is just that--an estimate by experts in the 
field of research of how much is needed to ``sustain current successful 
efforts--and increase our capacity to reduce suffering due to cancer.'' 
We urge your leadership in eradicating cancer by appropriating a 25 
percent increase to the NCI which will enable the following:
  --fund a greater proportion of fully approved investigator initiated 
        research applications;
  --support of the priorities identified in the By Pass Budget, 
        including cancer genetics; preclinical models of cancer; 
        detection technologies; developmental diagnostics;
  --strengthened efforts in translational research to more rapidly 
        translate research progress from the bench to the bedside;
  --initiatives to incentivize the research collaboration and establish 
        a strong partnership between the government, academia and 
        industry to maximize our research investment;
  --expand cancer prevention and detection research programs;
  --strengthen our current efforts in cancer survivorship research to 
        ensure the highest quality of life after cancer; and
  --added support, such as the NCI scholars program, to enable 
        outstanding new investigators in basic, clinical or population-
        based biomedical research to establish independent research 
        careers.
    In order to be most effective, funding must be provided in a manner 
that enhances creativity--encourages the risk taking inherent in 
innovation. Research funding must be sustained, also, in order to 
prevent the detrimental interruptions to investigators and research 
institutions that have long lasting effects.
    Progress depends in no small extent on insuring the continued and 
sustained renewal of the intellectual resources at the heart of the 
creative process--the dedicated, highly educated, creative scientists 
that determine the success of these endeavors. Regrettably, there is a 
trend of the ``brightest and best minds'' in our country away from the 
biomedical sciences into careers that appear more challenging and a 
more important part of our nation's future. This trend must be 
reversed.
    Maintaining the integrity of a group of top-notch academic health 
centers and strengthening a related group of research universities is 
also of vital importance. Clearly, these institutions provide the 
``environment'' and many of the resources necessary to a full spectrum 
of investigational and educational programs. The preservation and 
enhancement of these centers of excellence is an urgent matter of 
public concern. The chaotic conditions of the ``health care 
marketplace'' and the increasingly severe financial constraints that 
result, are forcing academic health centers devoted to research and 
education toward the ``endangered species'' designation. A strong and 
vital national research program is one of the cornerstones of 
preservation for these centers.
    Patient-centered research merits careful attention because it is 
the link between laboratory discoveries and the advances in prevention, 
diagnosis and treatment that improve medical practice and the quality 
of life of patients and their families. This transition is currently 
threatened by the practices of various health care management companies 
and by the payment practices of insurers. Further, the nominal support 
provided by the NCI to this endeavor--less than 10 percent of NCI's 
total budget--is causing many talented clinical researchers to go the 
way of the dinosaur as they are forced away from research and into 
clinical practice.
    Experimental therapy administered under the aegis of a fully 
approved clinical trial is often the best therapy available to many 
patients. It is important that patients not be denied access to 
clinical trials. The knowledge gained through these studies is 
important to progress, and the treatment offered may represent the best 
alternative available to the patient participants. Yet insuring 
participation in clinical trials due to charges in the health care 
marketplace is compromising our capacity to translate research from the 
laboratory bench to the bedside. The NCCR supports the spirit of the 
Administration's proposed demonstration to provide medical coverage for 
Medicare beneficiaries who participate in federally-approved cancer 
clinical research trials, but urges this Subcommittee to fund this 
demonstration in this fiscal year, rather than rely upon funding this 
program with receipts garnered through tobacco legislation which has 
not, and which may not, be enacted.
    Public support for medical research has never been articulated as 
clearly than over the past year. Since the June 20, 1997 global tobacco 
settlement, there has been a groundswell of public support to enhance 
our medical research enterprise to combat the effects of tobacco use. 
Congressional efforts to attend to this issue are evidenced by the 
profusion of tobacco related bills pending action by the 105th 
Congress. However, the NCCR recognizes the political roadblocks to 
Congressional codification of a tobacco settlement and urges this 
Subcommittee to meet the public health goals of both the June 20, 1997 
global tobacco proposal and the pending legislation to fund research as 
soon as is possible by providing a substantial increase to the National 
Cancer Institute this year. Your support for the NIH is vital as 
current prevention and treatment programs are not powerful enough nor 
swift enough to protect the 160,000 people who will die this year in 
the United States from cancers caused by smoking. Prevention and 
cessation programs alone cannot stop the threat of cancer, for recent 
studies have found that even former smokers continue to be at high risk 
for lung cancer for many years after smoking cessation because they 
carry long-term DNA damage in their lungs. Scientists have recently 
learned that these DNA changes are associated with the development of 
cancer, that the changes persist for many years after smoking 
cessation, and the lung tissue may never return to its normal state. 
Since DNA damage is absent from the lungs of lifetime nonsmokers, this 
confirms that the changes observed in former smokers are directly 
related to their previous smoking. Those who have stopped smoking can 
remain from 1.5 to 4 times more likely than nonsmokers to develop lung 
cancer. In fact, over half of all lung cancers in the United States 
today occur in former smokers. These new findings have alarming public 
health consequences for both current and former smokers. Bolstering the 
budget of the NCI will enable scientists to conduct important studies 
into the long-term adverse effects of tobacco carcinogens in proportion 
to the devastation caused by tobacco-induced cancers on our public 
health. Specifically, additional funding would support research to 
identify the specific DNA alterations associated with smoking and their 
role in lung cancer. Further investigations must be conducted to 
unravel the pathways and the timing of events leading to cancer. It is 
important to increase our understanding of the carcinogenic effects of 
tobacco, of how these malignant lesions can be treated most effectively 
after diagnosis, and of how these cancers can be prevented. 
Epidemiological studies are also required to increase our knowledge 
base of statistical trends in cancer to guide early detection efforts 
and facilitate the control of cancer. We cannot wait for broad 
Congressional codification of last summer's tobacco settlement, the 
time is now to stop the effects of tobacco use and this Subcommittee 
can do so by increasing the budget of the National Cancer Institute.
    We hope that you will find the rationale on which we base our 
recommendations to focus on cancer research compelling, and that you 
will be able to direct funds to cancer research to open the doors for 
researchers to find new methods for the prevention and treatment of 
cancer. Thank you for the Subcommittee for this opportunity to present 
this statement.
                                 ______
                                 
               Prepared Statement of the FDA-NIH Council
    Mr. Chairman, Members of the Committee, thank you for the 
opportunity to present a statement to the Committee as you deliberate 
funding priorities for fiscal year 1998. The FDA-NIH Council 
appreciates the opportunity to submit testimony concerning the 
importance of a sustainable, predictable funding base for the National 
Institutes of Health (NIH). In past years, this Committee has been 
vitally important in addressing the funding needs of the NIH, and the 
research community is grateful for your support of the crown jewel of 
the Public Health Service.
    The FDA-NIH Council is a coalition of 24 organizations comprised of 
patient advocates, academic scientists, health professionals, and 
medical research-based corporations. These partners in the process of 
medical discovery and innovation have come together to seek common 
ground in addressing the complex challenges the Food and Drug 
Administration (FDA) and the National Institutes of Health face.
    There is an intricate process of medical discovery and innovation 
that relies on the relationship of inter-dependent partners--
government, academia, biomedical research industries, foundations, 
health professionals and consumers. Medical research and innovation 
seek to improve health and the quality of life by finding ways to cure 
and prevent disease. Breakthroughs come from a process of innovation, 
each advance building upon the one that preceded it. From research in 
academic, government and industry laboratories, and from the 
accumulation of clinical experience in managing disease, our 
information about the mechanisms of disease and innovation in medicine 
are continually developed. As a representative of industry, I welcome 
the opportunity to address the unique contributions of the government 
in this regard as it is the national commitment to the NIH which lays 
the foundation of our ability to bring research discoveries from the 
laboratory to the consumer.
    All of the partners in the process of medical discovery are 
interdependent, each contributes a piece to the puzzle. The success of 
our national enterprise is not possible without each piece being 
vibrant and strong. A healthy partnership between government, industry, 
academia and non-profit foundations is critical to maintain the U.S. 
position as the world leader in medical research and innovation. Most 
importantly, the millions of Americans afflicted with catastrophic, 
acute and chronic diseases are the REAL beneficiaries of this 
partnership.
    The NIH is the primary funding source for basic research through 
universities and independent research institutions throughout the 
country. The NIH also plays a critical role in support of clinical and 
translational research. NIH-supported research has led to major 
advances in the understanding and treatment of various diseases and 
disabilities. NIH-funded researchers are now at the forefront of the 
global effort to build upon these findings and develop new, more 
effective treatment regimens. Success against disease will only be 
possible with a strengthened national research effort. Therefore, 
continued support of the NIH is critical to the vitality of our medical 
research enterprise.
    At the present time, our national support of the NIH is less than 3 
percent of our national health care costs. In essence the NIH is 
investing less than 3 percent of the national costs of illness in 
research efforts to find effective treatments and preventatives. From a 
business standpoint, it is logical that this investment paradigm should 
change as there is no health-care or science-based corporation in 
America who could sustain an effective operation with a 3 percent 
investment in innovation. To that end, the FDA-NIH Council is pleased 
to support proposals put forward in the House and the Senate in the 
last Session of the 105th Congress to double the NIH budget over the 
next five years. We commit to this Committee that FDA-NIH Council will 
work to support to realize these proposals.
    Industry presently devotes approximately 20 percent of its U.S. 
sales to research and development. This investment, which is greater 
than that of the NIH, is directed toward efforts quite different from 
the NIH but complimentary and equally essential. Our basic research 
efforts are more targeted and our clinical research initiatives are 
more expansive and directed toward the end product. Industry does not, 
and cannot, devote resources to the discovery of new knowledge at the 
basic, fundamental level that the NIH supports. Industry's 
responsibility in this partnership is the maturation of scientific 
knowledge and the translation of research discoveries from the bench to 
the bedside through targeted basic and applied research efforts. In 
addition, industry is closely aligned with academic medicine in centers 
throughout the country. Through the collaborations with universities 
and independent research institutes industry is involved in developing 
new technologies, setting standards for adopting and disseminating 
technologies, and supporting cutting-edge applied research to bring 
innovation to the marketplace.
    Throughout modern history, there have been revolutions in medicine 
that have saved millions of lives. The development of antibiotics, 
vaccines, and proven surgical techniques have constituted the 
revolutions of the past. We are now on the threshold of the next great 
revolution in modern medicine, gene therapy. Each time researchers 
discover a gene, they open the door to a new therapy or cure. Today, 
when we talk about our medical research enterprise, we speak from the 
standpoint of great success and even greater opportunities.
    Treatments for people with chronic diseases have stemmed from 
medical research and innovation.--medications control a variety of 
chronic diseases such as hypertension, high cholesterol and diabetes; 
asthmatics regularly participate in competitive sports where prior to 
innovative therapies they were subject to frightening breathing 
attacks; angina and shortness of breath associated with cardiac disease 
are now effectively managed through the use of medication; and the hope 
of gene therapy offers great potential to help persons with genetic 
diseases as well as for others suffering with a variety of chronic 
conditions.
    People with life threatening and chronic diseases look to medical 
research and innovation for the promise and hope of a cure.--Today, we 
have drugs to cure testicular cancer, childhood leukemia, and Hodgkin's 
disease, and to prevent strokes or permanent heart damage from heart 
attacks. Research efforts are starting the long process to develop and 
validate diagnostic markers and other tests to diagnose disease or 
determine the state of a chronic disease before it is evidenced (or 
worsens) in order to offer treatments prior to prevent disease 
progression.
    Medical research and innovation have prevailed to improve the 
quality of life for millions of us, but the challenge remains to find 
answers for millions more who face disease and disability.--Our current 
armament of therapeutic options consist of many half-way technologies 
and it is imperative that we push forward to develop effective cures 
and treatment for may of the hardest diseases that continue to confront 
us--cancer, heart disease, strokes, Alzheimer's disease, Parkinson's 
disease, multiple sclerosis, cystic fibrosis and others.
    The health of our nation is dependent upon a strong national 
commitment to medical research. The research opportunities have never 
been greater, or more exciting. Further, our leadership in the 
international arena in medical research and innovation is at a critical 
juncture, due to our international competitors' expansion of their 
research investment over the past two decades. Today, Japan and Germany 
devote a greater percent of their GNP to research and development than 
the U.S. does. This is a warning sign which should be taken seriously 
as we contemplate national priorities.
    As we enter the new millennium, we have attracted some of the best 
scientific minds to our national enterprise, and initiated ground-
breaking programs that have already yielded critical knowledge, and 
improved patient care and quality of life. However, we are confronted 
with the extraordinary challenge of how to maintain the integrity of 
our research efforts, and rapidly and cost-effectively translate that 
research and development into use by health professionals and 
consumers, in both the public and private sectors.
Budget Request
    We must position our national research efforts by providing a 
sustainable, predictable funding base for the National Institutes of 
Health augmented by new resources in order to pursue the extraordinary 
research opportunities which await. In that regard, the FDA-NIH Council 
urges Congress to enact a plan that will provide for a doubling of the 
NIH budget over the next five years. The FDA-NIH Council supports the 
vision articulated in H.R. 83, S.R. 15 and S. 124 which call for a 
doubling of the budget for the NIH in response to our declining 
commitment to research, based on the proportion of GNP invested in 
research, over the past 30 years. As a starting point, the FDA-NIH 
Council recommends an increase of at least 15 percent for fiscal year 
1999 as the first step in achieving this goal.
    While many other witnesses, representing a broad cross section of 
disease and research organizations will draw very compelling cases to 
devote these additional resources to specific disease research, members 
of the FDA-NIH Council would like to draw your attention to the 
capacity of our national research enterprise and its long term health 
as it undergoes the transformation required to meet the challenges of 
the next millennium. These needs will be critical to effectively 
undertake the many important research priorities that my colleagues 
will bring to your attention.
    Translation of new knowledge into clinical practice.--A balance in 
our federally-funded research program requires that we adequately 
support the translation of research from the test tube to the patient. 
As new knowledge is discovered, it is vitally important for the NIH to 
support early patient-oriented research to determine the application of 
laboratory advances to persons with disease. This early research must 
validate test tube observations prior to the maturation and full 
exploitation of advances in the marketplace. Further, training and 
educational programs require adequate resources to ensure that the next 
generation of clinical scientists is in place to continue the rapid 
translation of research from the bench to the bedside.
    Integrity of the peer review system.--As mentioned earlier in this 
statement, the United States has a national research capacity and track 
record that is unparalleled throughout the world. One of the core 
components of this research capacity is the integrity of our peer 
review system. Unlike many other agencies of the government, such as 
the Department of Defense, the peer review system of the NIH is 
critically important to the allocation of resources by the NIH. In 
fact, peer review is the cornerstone to insure that stewardship of the 
American taxpayer's contribution to this important initiative and 
direct our investment to the areas of greatest scientific opportunity.
    Resources for Research Support.--As the research capacity of the 
NIH expands, the expertise and staffing necessary to appropriately 
oversee that enterprise must be available. Management support budgets 
of the NIH must be carefully evaluated to ensure scientific program 
staff are in place to effectively guide an expanding research effort.
    Research Infrastructure.--The sophistication of our research 
initiatives requires an ever-increasing sophistication in our physical 
plants support our national research efforts. Research facilities, 
equipment and instrumentation, and animal facilities must be state-of-
the-art in order to fully exploit our research potential.
    The FDA-NIH Council recognizes that the Members of this great body 
have a very tough job in terms of weighing the available resources and 
numerous worthy federal programs. We recognize the tough choices that 
you have ahead of you. And, we recognize and are extremely grateful for 
the support that this Committee has provided to the NIH in the past. 
However, we also believe that the functions of the NIH are vital to our 
economy and the health and welfare of our citizens. Health must be one 
of our nation's top priorities, for a wealthy and economically sound 
country is predicated on the health and well being of its citizens.
    Thank you for the opportunity to present a statement before the 
Committee today. We appreciate your support of this agency and look 
forward to working with you in the coming months.
    The members of the FDA/NIH Council are: the A-T's Children Project, 
Candlelighters Childhood Cancer Foundation, Allergy and Asthma 
Network--Mothers of Asthmatics, Inc., Alliance for Aging Research, 
Schering-Plough Corporation, Albert B. Sabin Vaccine Foundation, 
American Medical Association, Merck & Co., Inc, Pfizer, Inc., American 
Veterinary Medical Association, Joint Council of Allergy, Asthma and 
Immunology, American Society of Tropical Medicine and Hygiene, Allergan 
Inc., American Academy of Pediatrics, National Multiple Sclerosis 
Society, Monsanto Company, Arthritis Foundation, Glaxo Wellcome, Inc., 
American Social Health Association, Cystic Fibrosis Foundation, 
Bristol-Myers Squibb Company, American Association for Cancer Research, 
National Depressive and Manic-Depressive Association, Society of 
Toxicology, Research Society on Alcoholism, Theracom, Parkinson's 
Action Network, and the Autism Society of America.
                                 ______
                                 
  Prepared Statement of the American Society of Tropical Medicine and 
                                Hygiene
    The American Society of Tropical Medicine and Hygiene (ASTMH) 
appreciates the opportunity to submit written testimony concerning 
fiscal year 1999 funding for the National Institutes of Health and the 
Centers for Disease Control and Prevention.
    The ASTMH, founded in 1903, is a professional society of 
approximately 3,500 researchers and practitioners who are dedicated to 
addressing the growing global threat of tropical infectious diseases. 
ASTMH members are involved in all areas of tropical disease research 
such as identifying biochemical and genetic factors that disrupt 
parasite development within mosquito vectors in order to develop novel 
control strategies for malaria and lymphatic filariasis.
    A strong U.S. research agenda relating to infectious diseases is 
critical at this time when the ease of travel and openness of trade 
exposes the world's population, including U.S. citizens, to new and re-
emerging infectious disease agents. Last year it was Cyclospora, a 
parasite that found its way across the border by way of Guatemalan 
raspberries and lettuce. And we are all now familiar with the re-
emergence of tuberculosis and emergence of new diseases such as 
Hantavirus within the U.S. In total, 30 new human pathogens have been 
recognized in the last 25 years. It also is evident in our new world 
economy that, in addition to humanitarian reasons, investments that 
help ensure healthy populations in developing countries benefit the 
world's population as a whole. We must continue to be vigilant in our 
efforts to control and eradicate infectious diseases through 
prevention, treatment, and continued surveillance. As we approach the 
21st century, it is time to protect our national security and declare 
war on malaria, diarrheal disease, and the myriad of other infections 
caused by viral, bacterial, fungal and parasitic disease agents.
National Institutes of Health
    ASTMH thanks the Committee for your strong support for medical 
research funding. We are particularly pleased with the 7.1 percent 
increase Congress provided to the NIH for fiscal year 1998, and by your 
continuing commitment to provide funding that will sustain our research 
infrastructure in the years to come.
National Institute of Allergy and Infectious Diseases
    The NIH's tropical disease research program is funded primarily by 
the National Institute of Allergy and Infectious Diseases (NIAID) and 
there are several issues relating to NIAID's research efforts that we 
would like to highlight.
    Infrastructure Issues.--From fiscal year 1993 through fiscal year 
1998, NIAID has received significant funding increases for both the 
intramural and extramural programs of about 40 percent. Unfortunately, 
the research management and support (RMS) budget, which provides 
administrative support for the extramural program, has increased by 
only 0.1 percent during this same time period. This resulted from a 7.5 
percent cut in fiscal year 1996 that reduced the RMS budget back to 
fiscal year 1993 levels. The ASTMH is concerned that we are not 
providing the Institute with the resources necessary to manage our 
important infectious disease programs. We are not arguing for large 
increases, but are merely calling for responsible stewardship of the 
extramural programs and grants to ensure that we are effectively 
meeting the goals and objectives of our research programs.
    Malaria.--Globally, infectious diseases are the leading cause of 
morbidity and mortality, accounting for 1-3 times the mortality and 
morbidity resulting from heart disease, cancer and stroke combined. Of 
these infectious diseases, malaria continues to be the most devastating 
with a World Health Organization estimate of nearly 500 million 
clinical cases and 2-3 million deaths annually--and the majority of 
these deaths are African children under the age of 5. But even in the 
U.S., over 1,000 cases of malaria are reported every year, with local 
transmission being documented by the Center for Disease Control and 
Prevention (CDC) in California, Florida, New Jersey, New York, Texas, 
Michigan and Georgia. The Society applauds NIH Director Dr. Harold 
Varmus and NIAID Director Dr. Anthony Fauci for their leadership at 
home and abroad in advancing the international collaborative research 
project, the Multilateral Initiative on Malaria, and for implementing 
NIAID's Research Plan for Malaria Vaccine Development. Malaria is a 
complex disease and its control will require a significant research 
effort in vaccine development as well as other research areas. We are 
pleased that NIH recognizes this and is willing to commit significant 
resources towards solving this problem. We urge the Committee to be 
supportive as well.
    International Tropical Disease Research Programs.--NIAID's support 
for international tropical disease research is critical for advancement 
of our scientific understanding of emerging, re-emerging and other 
tropical diseases. Through these programs, U.S. researchers are able to 
collaborate with their colleagues worldwide in efforts that are 
absolutely mandatory to gain research expertise in areas endemic for 
tropical infectious diseases. Two programs in particular have been 
critical in these efforts and the ASTMH urges the committee to not only 
continue these programs, but to increase support for these important 
projects. They are:
    International Collaborations in Infectious Disease Research.--An 
international research program to support collaboration between U.S. 
scientists and foreign research institutions for work in countries 
where tropical diseases are endemic, and
    Tropical Disease Research Units.--A domestic grant program that 
promotes the application of modern biomedical technologies to the 
development of preclinical evaluation of new vaccines, therapies, or 
vector control methods for tropical parasitic diseases.
Fogarty International Center
    NIH also supports emerging infectious disease research and training 
through the Fogarty International Center (FIC). Recently FIC initiated, 
in concert with the NIAID, an International Training Program in 
Emerging Infectious Disease whereby U.S. universities provide training 
for scientists from regions of the world where some of the most 
important emerging and re-emerging diseases are endemic. This program 
promises to provide a mechanism to transfer the most recent scientific 
advancements and technologies to endemic areas and consequently 
increase our understanding of the biology, epidemiology and methods for 
control of emerging pathogens.
    The ASTMH is encouraged by the initial awards made to thirteen U.S. 
universities and encourages the FIC to re-issue its Request for 
Applications and expand funding opportunities to additional research 
universities. This is an extremely worthwhile program that is essential 
if we are to expand overseas training and capitalize on recent 
scientific advancements. We urge the Committee to provide sufficient 
funds to allow the FIC to fund as many meritorious awards as possible.
Centers for Disease Control and Prevention
    The ASTMH appreciates the Committee's support for funding increases 
in fiscal year 1998 for the CDC's infectious diseases program. We are 
especially pleased with the increases over fiscal year 1997 levels for 
the National Center for Infectious Diseases emerging and re-emerging 
infectious diseases program.
    Emerging Infectious Diseases Strategic Plan.--As you know, CDC is 
in the process of developing its second five-year plan to address 
emerging infectious disease threats through the year 2002. This report, 
titled ``Addressing Emerging Infectious Disease Threats II: Entering 
the 21st Century'' soon will be released and will provide the blueprint 
for the CDC's activities to combat emerging infectious diseases in 
collaboration with other U.S. agencies and international organizations. 
These efforts are critical in establishing priorities relating to 
surveillance, applied research, training, and disease prevention and 
control of emerging infectious diseases in the coming years.
    Infrastructure Needs.--The Society strongly urges the Committee to 
support CDC's infrastructure needs that include the need for new 
laboratory space to handle all of the pathogens that are being examined 
by CDC scientists in Atlanta. With recent outbreaks of new infectious 
diseases, such as avian influenza in Hong Kong, CDC laboratories are at 
capacity and they have had to reduce existing pathogen research to make 
room for the new pathogens. Space limitations that require the 
cessation of surveillance or research activities on one pathogen to 
make room for work on a new disease agent is a dangerous situation that 
must be addressed.
Conclusion
    As the 20th Century comes to a close we must change our vision of 
U.S. national security. We are at war, but this time infectious 
diseases are our enemy. Infectious disease agents have no respect for 
political borders, and social or economic status do little to ensure 
safety from new diseases or those re-emerging as a consequence of drug 
resistance or other causes. To be prepared for a battle that 
undoubtedly will intensify, we must have adequate surveillance systems 
and modern infrastructure, coupled with scientific expertise in both 
basic and clinical research, if we are to develop the tools necessary 
to rapidly respond to, and control, the threats posed by infectious 
diseases.
    The ASTMH greatly appreciates your support of these activities. We 
urge you to continue your efforts to double the NIH budget over the 
next five years and towards this end we request a 15 percent increase 
for the NIH budget in fiscal year 1999. We also request that the 
Committee provide a $15 million increase for the CDC's emerging 
infectious diseases activities.
    Thank you for providing us with this opportunity to express our 
appreciation and concerns.
                                 ______
                                 
            Prepared Statement of the Society of Toxicology
    The Society of Toxicology (SOT) is pleased to have this opportunity 
to submit written testimony in support of fiscal year 1999 funding for 
the National Institutes of Health (NIH), and specifically for the 
National Institute of Environmental Health Sciences (NIEHS).
    The Society of Toxicology (SOT) is a professional organization that 
brings together over 4,000 toxicologists in academia, industry, and 
government. A major goal of SOT is to promote the use of good science 
in regulatory decisions. With scientific data as our guide, we can use 
sound judgment in addressing numerous environmental issues. In 
particular, we work closely with the National Institute of 
Environmental Health Sciences (NIEHS) in addressing research related to 
environmental risk.
Research Opportunities
    Members of the Society of Toxicology strongly believe that our 
investment in biomedical research must be increased and sustained over 
the long-term if we are going to take advantage of the many exciting 
research opportunities which exist in the area of environmental health 
sciences. We are appreciative of the outstanding research efforts of 
NIEHS and are supportive of the research priorities identified by NIEHS 
Director Dr. Kenneth Olden.
    Research supported by NIEHS is helping us to better understand how 
our environment affects our health. Research is being conducted to 
study the effects of air pollution such as ozone, particulate matter, 
and acid aerosols on our respiratory health. NIEHS supported research 
has shown the harmful health effects of lead especially in children, 
leading to the reduction of many sources of environmental lead. 
Researchers are now expanding their efforts to better understand why 
some people are more susceptible to environmental exposures than 
others. The Environmental Genome Project will further explore these 
questions. Finally, NIEHS under the auspices of the National Toxicology 
Program are making progress in developing new and innovative transgenic 
animal models to more efficiently test the toxicity of chemicals. This 
increased efficiency will allow for more chemicals to be tested more 
quickly.
    SOT also supports the research NIEHS is conducting on the potential 
adverse effects of endocrine disruptors. Endocrine disruptors are 
compounds in our environment which may have an affect on thyroid and 
reproductive function and development. The Society believes that 
additional research is needed to determine the nature and the extent to 
which this is a human health problem.
Superfund Basic Research Program
    One program we would like to highlight is the Superfund Basic 
Research Program. This program is administered by NIEHS although it is 
funded through a pass through from the Environmental Protection Agency 
(EPA) to NIEHS. The Superfund Basic Research Program is the only 
scientific research program focused on health and cleanup issues for 
Superfund hazardous waste sites. It represents an important 
collaboration between EPA and NIEHS to ensure that environmental 
cleanup decisions are based on sound environmental health science.
    The Superfund Hazardous Substances Basic Research Program supports 
university and medical school research to understand the public health 
consequences of local hazardous waste sites, as well as to develop 
better methods for remediation. Currently, there are 18 programs at 70 
universities involving more than 1,000 scientists. It is important to 
note that this is the only university-based research program that 
brings together biomedical and engineering scientists to provide the 
science base needed for making accurate assessments of human health 
risks and developing cost-effective cleanup technologies.
    The primary purpose of SBRP is to provide the scientific basis 
needed to make accurate assessments of the human health risks at 
hazardous waste sites. In addition, research data is used to determine 
which contaminated sites must be cleaned up first, to what extent clean 
up is needed, and how best to clean up contaminated sites in the most 
cost-effective manner. Research projects include basic research on the 
potential chemical effects on cancers, such as breast and prostate, 
birth defects, and other environmental health-related diseases.
    Communities near hazardous waste sites want to know if hazardous 
chemicals are reaching their water or air supplies. They want to know 
if low levels of these contaminants affect their health and their 
children's health. They want it cleaned up. Our universities are 
responding with technology driven research efforts which are results-
oriented and economically feasible, and are scientifically credible 
with the public. This is only possible because of the research effort 
funded through the Superfund Basic Research Program and administered by 
NIEHS.
Funding Request
    The Society of Toxicology strongly supports efforts to double 
funding for the NIH over five years. To accomplish this, we urge the 
Committee to provide a 15 percent increase for both the NIH and NIEHS 
in fiscal year 1999. NIEHS is particularly deserving of this increase 
given the enormous role they are playing to expand our understanding of 
how the environment potentially affects our health. Whether it is 
exploring asthma incidence in children, testing the toxicity of 
chemicals, or better understanding the genetics underlying 
environmental risk factors, NIEHS supported research is leading the way 
in bridging the gap between public policy and environmental health 
science.
    Thank you for considering our request. We look forward to working 
with you in the future as you determine the Committee's funding 
priorities.
                                 ______
                                 
  Prepared Statement of the National Deppressive and Manic-Depressive 
                              Association
    The National Depressive and Manic-Depressive Association (National 
DMDA) is pleased to have this opportunity to submit written testimony 
in support of fiscal year 1999 funding for mental health research 
supported by the National Institutes of Health (NIH) and the National 
Institute of Mental Health (NIMH).
    With more than 275 support groups in nearly every state, National 
DMDA is the nation's largest patient-run, illness specific organization 
committed to advocating for research toward the elimination of 
depressive illnesses, educating patients, professionals and the public 
about the nature and management of depression and manic-depression as 
treatable medical diseases, fostering self-help, eliminating 
discrimination and stigma, and improving access to care. National DMDA 
was founded in 1986 and is headquartered in Chicago, Illinois. A 
distinguished scientific advisory board of more than 65 members reviews 
all materials published by National DMDA, and provides critical and 
timely advice on important research opportunities and treatment 
breakthroughs. This Board includes the leading researchers and 
clinicians in the field of depressive disorders.
The Impact of Depressive Illness
    More than 18.4 million American suffer from depression every year. 
An additional 2.3 million people suffer from manic-depression or 
bipolar disorder. Women are more than twice as likely as men to 
experience major depression. Depression is the leading cause of suicide 
in America--the financial burden of which is over $10 billion a year. 
Two out of three people with mood disorders do not get proper treatment 
because their symptoms are not recognized, are misdiagnosed, or due to 
the stigma associated with mental illness, are blamed on personal 
weakness.
    According to a recent study by the World Health Organization (WHO), 
the World Bank, and the Harvard School of Public Health, unipolar major 
depression is the first-ranked leading cause of disability in the world 
today and bipolar disorder is the seventh-ranked cause of disability. 
The economic cost of depressive illnesses in the United States is 
estimated to be almost $44 billion per year in direct and indirect 
costs including absenteeism, mortality, and lost productivity. We 
cannot continue to ignore the seriousness of mental illness but must 
instead must focus our research resources on better understanding 
depressive illnesses, improving treatments, and seeking a cure.
    Our investment in research into new treatments for depression and 
manic-depression has paid off in many ways. For example, more than $145 
billion has been saved since 1970 as a result of the development of 
lithium treatment for manic-depression--almost $6 billion per year. A 
study supported by the NIMH showed that intervention to prevent 
depression in the workplace resulted in $1,314 per person in increased 
Federal and state taxes generated over a two and a half year period, 
with a cost of only $286 per person. Finally, it has been shown that 
every $1 spent on treatment of depressive disorders yields between $3 
and $9 in net economic return on employment earnings.
Research Progress
    Due to research supported by the NIMH over the past five years, we 
have seen the development of new, more effective medications for both 
depression and manic-depression. As a result of a recent clinical 
trial, we now know that the anti-depressant fluoxetine (Prozac) is 
effective in children, although it is not as effective as it is in 
adults--an issue which requires more study. Also, we have a better 
understanding of depressive illnesses and are learning more about their 
impact on cardiovascular disease and stroke. The comorbidity of 
depression and alcohol and tobacco use is also becoming more clear. 
Research indicates that treating only addiction and not depression 
leads to failure and relapse and vice versa. The comorbidity of 
diabetes and depression has also been documented. Unfortunately, we 
still have a long way to go before we are able to fully understand and 
treat depressive disorders.
    St. John's Wort.--National DMDA is pleased that NIMH is working 
with the Office of Alternative Medicine (OAM) at NIH to conduct a study 
of the effectiveness of Hypericum perforatum, or St. John's wort, in 
patients with mild to moderate depression. Many consumers are trying 
St. John's wort as an alternative to prescription anti-depressants 
based on anecdotal experiences and promising results reported from 
European studies. These short-term studies indicate that St. John's 
wort may be beneficial in treating mild to moderate depression with 
fewer side effects than prescription anti-depressants. It does not 
appear, however, to be as effective in treating severe depression or 
manic-depression. Unfortunately, hundreds of thousands consumers are 
using St. John's wort with little scientifically proven information 
about how the herb works, what dose is appropriate, its effectiveness, 
potential dangerous interactions with other prescription drugs, or the 
long-term effects of use. The three year OAM/NIMH study will provide us 
with the database necessary to answer some of these questions. National 
DMDA is playing an active role on the advisory committee overseeing 
this research effort and hopes that consumers will soon have the 
information they need to make an informed decision about the use of St. 
John's wort.
    Bipolar Disorder.--We are also encouraged by NIMH's increased focus 
on bipolar disorder. Research in this area has been seriously 
underfunded in recent years. In fact, in 1996, NIMH spent only $33 
million on bipolar research--less than 5 percent of its total budget. 
Given the WHO study cited above which shows that bipolar disorder is 
the seventh-ranked cause of disability in the world today, we must 
expand our research efforts as they relate to manic-depression. 
National DMDA hopes that NIMH will move quickly to implement clinical 
trials on the effectiveness of new antipsychotic or anticonvulsant 
medications such as gabapentin or lamotragive for treating bipolar 
disorder. In addition, research efforts must focus on the early 
detection and management of bipolar disorder in clinical care settings. 
Finally, additional research is needed on the diagnosis and treatment 
of manic-depression in children and adolescents.
Research Opportunities
    National DMDA recently surveyed its scientific advisory board 
members to get their views on where NIMH's basic and clinical research 
efforts should be focused. In conducting this exercise we wanted to get 
the views of the leading scientists who are working on depressive and 
manic-depressive illnesses to ensure that the research we are 
supporting is the most current and productive. It is not surprising 
that the vast majority responded that the area of genetics is the most 
ripe for basic research. Current research indicates that there is a 
genetic predisposition to manic-depression. We urge NIMH to pursue this 
research aggressively by continuing research studies of individuals 
with manic-depression and their family members. Other factors to 
examine in relation to genetics include the role stress and the 
environment play in triggering depressive episodes.
    Other important research opportunities include research to better 
characterize subtypes of depression; find treatments with fewer side 
effects and understand the psychopharmacology of current 
antidepressants; functional brain imaging and neurobiological research 
to understand the role gender plays in the predisposition to depressive 
illnesses; and studies to close the gap between what is known about 
treating depressive illnesses and what is practiced particularly in 
managed care settings. These are just a few of the research areas where 
great opportunities exist. Even as the Decade of the Brain comes to a 
close, we have only begun to scratch the surface in our understanding 
of brain function and mental illness. Given the advances in 
neurobiology in recent years, we should designate the 21st Century the 
``Century of the Brain'' and pursue and aggressive mental health 
research agenda.
Funding Request
    Of course, an aggressive research agenda requires sustained 
funding. While we recognize the Subcommittee's current budgetary 
constraints, National DMDA supports efforts to double the budget for 
the NIH and NIMH over the next five years. This will allow us to take 
full advantage of the many exciting mental health research 
opportunities that exist today. We urge the Committee to provide a 15 
percent increase for NIH and NIMH in fiscal year 1999 as the first step 
to doubling the budget.
    We appreciate your past support for medical research funding and 
look forward to working with you in the future to ensure the long-term 
sustainability of our mental health research infrastructure.
                                 ______
                                 
Prepared Statement of the National Alliance for Eye and Vision Research
    The National Alliance for Eye and Vision Research (NAEVR), an 
umbrella organization of twenty-eight professional, lay advocacy and 
industry organizations dedicated to eye and vision research, 
appreciates the opportunity to submit testimony in support of funding 
for the National Institutes of Health and the National Eye Institute.
    The National Alliance would like to begin by thanking Committee 
members for your commitment to medical research supported by the 
National Institutes of Health and the National Eye Institute. Without 
this support we would not be on the verge of many new discoveries in 
eye and vision research. We are beginning to reap the benefits of our 
investment due to the amazing advances in basic and clinical science, 
but more and more we are forced to prioritize what areas of research to 
support because we do not have the funding available to fund all of the 
opportunities that exist. This is true in all areas of vision research, 
and in the public and private sectors.
Priority Setting
    We understand that the Committee has expressed concern about how 
the NIH sets its research priorities and has asked NIH to pay careful 
attention to the economic and societal impact of diseases when planning 
its research funding allocations. It is our hope that you will closely 
examine the process that the National Eye Institute (NEI) has used 
since it was created nearly twenty-five years ago to involve the eye 
and vision research community and the public in setting its research 
funding priorities.
    The NEI and the National Advisory Eye Council (NAEC) are just now 
completing work on their seventh strategic plan, Vision Research A 
National Plan: 1999-2003. This plan is the result of a unique 
partnership between all of the stakeholders in the eye and vision 
research community including NEI staff, the NAEC, research scientists, 
lay advocacy organizations, foundations, industry, professional 
societies, and the general public. In order to reach all interested 
parties, NEI posted several questions on its web site to gather input 
from the eye and vision research community about its views about the 
most important research accomplishments in the last five years, and the 
most important areas to be explored in the next five years. Expert 
panels in each area of vision research were assembled and, based on 
their expertise and the input received from the process outlined above, 
set goals and objectives and determined research needs and 
opportunities for the next five years. This report will be published 
soon and will serve as the driving force behind our vision research 
efforts leading into the 21st Century.
    Those of us in the extramural community believe that this plan 
reflects the best in terms of balancing research opportunities with 
compelling societal and economic concerns.
The Importance of Vision Research
    When asked what sense do you fear losing the most a majority of 
Americans respond ``vision''. In the U.S. today more than 1.1 million 
Americans are legally blind and an estimated 80 million are at risk of 
developing potentially blinding eye diseases. 120 million Americans 
wear corrective glasses or contact lenses and 12 million suffer from 
some form of visual impairment that cannot be corrected by glasses. The 
annual cost of eye and vision disorders is $38.4 billion. As our 
population ages, these costs will increase significantly and present 
many challenges to our health care system.
    It is only through further advances in research that we are going 
to gain a better understanding of vision disorders that can lead to 
cost-effective advances in disease prevention and treatment. We now 
have the scientific and technological capability to make substantial 
progress in all areas of eye and vision research, IF an expanded 
research effort is supported. This research progress will only be 
possible if we can insure that the NEI has the resources necessary to 
pursue initiatives in the key areas outlined in the soon-to-be-released 
Vision Research Plan.
    In order to give you a sense of the research needs and 
opportunities that exist today, we would like to outline several 
diseases and disorders where research has the most promise.
Age-related Macular Degeneration
    The leading cause of blindness in the elderly is age-related 
macular degeneration (AMD), a retinal disease which causes loss of 
central vision. More than 1.7 million Americans over age 65 suffer from 
AMD and this number is expected to triple by the year 2020. At the 
present time, there is no cure for AMD and treatment remains limited. 
While laser treatment has been found to have some effect in delaying 
some forms of AMD, no current treatments exist that will reverse the 
slow loss of central vision that results from this disease. However, 
recent research developments are encouraging.
    NEI-supported researchers are making progress in unlocking the 
mysteries of AMD. Scientists have mapped genes of several different 
forms of heritable macular disease, are exploring retinal 
transplantation and growth factors, and are testing new treatments 
including the effects of antioxidants on the progression of AMD.
    The NEI is also actively pursuing studies in the use of alternative 
therapies for the treatment of AMD. The Age-Related Eye Disease Study 
(AREDS), which is designed to improve our understanding of AMD and 
cataract, includes the study of the effect of vitamins and antioxidants 
as treatments for AMD and cataract. In addition, the NEI will be 
sponsoring a workshop with the Office of Dietary Supplements in 
February to develop a research plan to evaluate the effect of two 
carotenoids, lutein and zeaxanthin, on AMD and cataract.
Low Vision
    A related area of concern is low vision, or vision impairment which 
is not correctable by glasses or contact lenses. As many as 12 million 
Americans suffer from visual impairments which affect their ability to 
read, drive, work, and perform many everyday activities we all take for 
granted. The most common eye diseases which cause visual impairment in 
adults are AMD, cataract, glaucoma, diabetic retinopathy, and optic 
nerve atrophy. Even more serious are the eye diseases which cause 
visual impairment in children. These include retinopathy of 
prematurity, cortical visual impairment, and coloboma. Low vision in 
children often affects their development and results in the need for 
special education, vocational training, and social services throughout 
their lives. The cost of these impairments is more than $22 billion 
each year.
    Many important aspects of low vision are ripe for continued 
exploration. One which deserves particular mention is the advancement 
of technology and assistive devices to help those with visual 
impairments to carry out everyday functions as independently as 
possible. Issues to explore include providing sufficient training in 
the use of these devices, reducing their cost, and improving the 
functionability and appearance of these devices if they are to be 
accepted by users. Researchers remain frustrated because advances in 
low vision devices seem not to be reaching the people with impairments, 
in part because of a lack of insurance coverage for evaluations and 
devices. Scientists are researching better ways of presenting hard to 
read computer graphic user interfaces, and developing telescoping and 
other optical devices to improve intermediate distance tasks and 
peripheral vision.
    Under the auspices of the National Eye Health Education Program 
(NEHEP), NEI is working with its private sector partners to launch a 
program directed at low vision in order to increase public awareness 
about visual impairment and the impact it has on everyday life. The 
program will provide information about low vision services and the 
devices which are currently available to assist those with visual 
impairments. This effort will not only be directed at those suffering 
from visual impairments but also to medical professionals, eye care 
specialists, managed care organizations, and family members. NAEVR 
supports this public education partnership and encourages the Committee 
to support it as well.
    Diabetes.--Diabetic retinopathy, the leading cause of blindness in 
individuals with diabetes, causes vision loss in more than 24,000 
Americans each year. In fact, if a person has diabetes, they are 25 
times more likely than the general population to go blind. Despite the 
success of research in developing treatments to slow the progression of 
blindness, little is known about the mechanism that triggers diabetic 
retinopathy.
    Researchers supported by the NEI are focusing their research 
efforts on gaining a better understanding of diabetic retinopathy by 
examining the cell biology of the retina, including cell growth 
factors; how blood flow is regulated in the retina; and the development 
of new drugs which inhibit an enzyme which appears to be involved in 
the development of diabetic retinopathy. Research in these areas will 
lead to better treatments, strategies for prevention, and hopefully, a 
cure. The recent funds made available for diabetes research in the 
Balanced Budget Act will help serve to push forward these important 
research pursuits and give hope to the millions of Americans who suffer 
from diabetes and risk blindness from diabetic eye diseases.
    Glaucoma.--As many as three million Americans have glaucoma and 
approximately 120,000 are blind because of this disease. It is the 
leading cause of blindness in African Americans and the second leading 
cause of irreversible vision loss overall in the United States. 
Glaucoma is a strongly age-related disease and is especially prominent 
in ``old'' elderly (75-80+). Specifically, at least 5 percent of white 
Americans and 10 percent of black Americans in this age group have this 
disease.
    Treatments for glaucoma are available. In the last five years, as a 
result of NEI-sponsored glaucoma research, three new drug therapies, 
which lower intraocular pressure, have been introduced. Unfortunately, 
however, many individuals with glaucoma are not receiving treatment 
because glaucoma usually has no symptoms in its early stages and they 
are unaware that they have the condition.
    A recent national survey by the Glaucoma Research Foundation, a 
member of NAEVR, indicated that public awareness of glaucoma and its 
risk factors is extremely low--only 11 percent of African American's 
surveyed were aware that they are risk, and only half of the African 
American's surveyed had an eye exam in the last two years. Public 
education efforts have included the development of a public service 
announcement by the NEI for use in January during Glaucoma Awareness 
Month.
    Much progress has been made on identifying a glaucoma gene for 
juvenile open angle glaucoma. Since this discovery, a total of nine 
genes have been mapped for glaucomas or ocular diseases associated with 
secondary glaucomas such as congenital glaucoma, primary open angle 
glaucoma in adults, and Rieger syndrome. More research must be done to 
more fully understand genetic predisposition and the other factors 
which trigger glaucoma.
    Tremendous advances have been made in the cellular and molecular 
biology of the ocular fluid formation and drainage tissues which 
regulate intraocular pressure, opening up new approaches to the 
pathophysiology and potential therapy of pressure elevation. But those 
with glaucoma lose vision not from high intraocular pressure per se, 
but from pressure-related and other types of damage to the optic nerve 
and retinal ganglion cells at the back of the eye, which conduct the 
visual signals from the retina to the brain. Recent advances in the 
neurobiology of how retinal ganglion cells die and might be protected 
have opened the possibility of treating these cells directly. Related 
to this is our increasing understanding and technology for evaluating 
the role of vascular circulation at the back of the eye in the 
pathophysiology and therapy of glaucoma. These are areas of great 
opportunity, which could be pursued even more aggressively with 
sufficient resources.
    Cataract.--Cataract is the leading cause of blindness in the world. 
A cataract is a lens opacity which interferes with vision. It occurs 
most often in adults 50-60 years and older. In the U.S., 1.35 million 
cataract surgeries are performed each year to remove cataracts at an 
estimated cost of $3.5 billion, much of which is paid for by Medicare.
    Because the U.S. population is aging, it will be important to focus 
our research on what aging factors lead to cataract. At this point, 
little is known about events which trigger cataract formation. Several 
major hypotheses have been proposed to explain age-related cataracts. 
Researchers must now turn their attention to proving or disproving 
these hypotheses and improving our understanding of cataract formation.
    Dry Eye.--Recent advances in basic research have led to unexpected 
discoveries which have implications for improving the treatment of 
``dry eye'', a symptom of Sjogren's Syndrome which affects women 
between the ages of 40 and 60. Further research must now be done to 
translate these basic research advances to improve clinical diagnosis 
and treatment. Animal models which are currently being studied show the 
link between androgen sex hormones and the lacrimal gland, which might 
explain why women are more likely to develop Sjogren's Syndrome than 
men. If this holds true, hormone modulation therapies may be used to 
successfully prevent and treat primary lacrimal deficiency and to treat 
``dry eye''.
    Myopia.--Myopia, or nearsightedness, occurs in approximately 25 
percent of the population. Myopia results when the images of distant 
objects are focused in front of, instead of on, the retina and is 
usually due to the fact that the eye is too long. Because myopia 
affects such a large percentage of the population, it is important that 
researchers continue their work to better understand ocular growth and 
its affect on vision. This research will help scientists determine the 
risk factors for myopia and develop treatments to slow the progression 
of this condition.
Eye Diseases and Tobacco Use
    In the past several years, there have been many studies published 
which implicate tobacco use as a risk factor in vision disorders such 
as age-related macular degeneration and cataract. For example, recent 
studies by vision researchers published in the Journal of the American 
Medical Association have shown that current smokers have a 
significantly higher risk of developing late age-related macular 
degeneration than nonsmokers. If Congress chooses to act on legislation 
implementing a global tobacco settlement which includes additional 
funding for tobacco-related research, we hope members of the Committee 
will remember that tobacco use is causally linked to several vision 
disorders. Additional funding for research directed to explore this 
link will help us better understand tobacco use as a risk factor and to 
develop new treatments and prevention strategies to address this risk.
Conclusion
    The members of the National Alliance for Eye and Vision Research 
are supportive of an increased research focus on eye and vision 
disorders, such as those outlined above, and hope that the Committee 
will allocate additional funding to the NEI to allow these critically 
important research efforts to continue and expand. As we enter the 21st 
Century, we must ensure that we are doing our best to find ways to 
prevent and treat eye and vision disorders, and are providing quality 
eye care services and devices for those who are already suffering from 
visual impairment.
    We thank you for your continuing support for medical research 
funding. Because NAEVR is supportive of efforts to double the NIH 
budget over the next five years, we urge you to provide a 15 percent 
increase in fiscal year 1999 for the NIH as the first step toward 
doubling the budget. Furthermore, we urge you to provide $408.6 
million, a 15 percent increase, for NEI in fiscal year 1999 as 
requested by the National Advisory Eye Council in its ``Citizens Budget 
Proposal''.
                                 ______
                                 
      Prepared Statement of the National Aging and Vision Network
    The National Aging and vision Network is comprised of individuals 
and representatives of public and private agencies that provide vision 
rehabilitation services to persons who are older and blind, who reside 
in all 50 states, the District of Columbia, and the territories. Formed 
in 1994, the Network's goal is to increase the availability of 
responsive, high quality services for older individuals who are blind 
or severely visually impaired, through the vision-related 
rehabilitation system, the aging network, and the health care system. 
Network members collaborate on advocacy efforts, share vital 
information on service delivery mechanisms, develop outcome measures, 
and work to develop and maintain funding resources to support essential 
services.
Appropriation for Title VII, Chapter 2 of the Rehabilitation Act
    For fiscal year 1999, the Network strongly urges the Subcommittee 
to increase the funding for Title VII, Chapter 2 to $13 million. This 
amount will trigger the formula funding mechanism established by 
Congress in the 1992 amendments to the Rehabilitation Act. Both House 
and Senate versions of pending amendments to re-authorize the Act 
retain this authority.
    However, the formula will not trigger until the Chapter 2 
appropriation level reaches $13 million. With an appropriation of $13 
million, each state will receive a minimum of $225,000. States with 
larger populations of older individuals would receive proportionally 
increased amounts.
    Since its first funding in 1986, this program has been one of the 
most successful and cost-effective programs initiated by Congress. In 
1996-97 the grantee states used the funds to deliver services to over 
27,000 older individuals. The number of persons served through this 
program has doubled in the five year period since a minimum funding 
level of $160,000 per state was established.
    Documented program evaluations show that these services have 
enabled older individuals who become blind to continue to live 
independently in their own homes and communities. The program has 
helped these individuals to regain self-reliance by providing the 
skills needed to perform the most basic tasks of daily living, and to 
remain active and contributing members of their communities.
    The types of services provided by grantee states include: training 
in how to travel safely; communications skills; training in activities 
of daily living; low vision services and adaptive devices; individual 
counseling and support services to family members; and community 
integration. The goal of all these services is to reduce the need for 
costly support services such as in-home and community-based services 
and/or premature nursing home placement.
    There are already approximately 5 million individuals age 55 or 
over who are experiencing severe vision loss. This number is expected 
to double by the year 2030. Funds for vision-related rehabilitation 
services for this population are not provided through the Older 
Americans Act, Medicare, Medicaid, or any other consistent funding 
mechanism. Attached to this statement is a chart based on the 1995 
Census Survey of Income and Program Participation showing the numbers 
and prevalence of severe vision impairment of individuals who are age 
55 and over and 85 and over in states represented on this Subcommittee. 
(See Attachment A)
    With funds currently available we are only able to serve a small 
number of these individuals. Because the $13 million dollar 
appropriation will trigger the formula grant process, this small 
increase will have a significant effect in allocating funding for these 
services.
                              Attachment A
    These numbers represent individuals who on the Census Survey of 
Income and Program Participation identified themselves as having 
difficulty seeing words and letters in ordinary newsprint even with 
glasses or contacts or who reported not being able to see words and 
letters in newsprint at all.

----------------------------------------------------------------------------------------------------------------
                                                     Number of     Percentage of     Number of     Percentage of
                      State                         respondents    total number     respondents    total number
                                                      age 55+     of respondents      age 85+     of respondents
----------------------------------------------------------------------------------------------------------------
Arkansas........................................          93,960              16          19,400              47
Hawaii..........................................          20,710               9           3,430              26
Iowa............................................          70,860              10          17,200              29
Mississippi.....................................          98,340              18          19,730              53
Missouri........................................         133,120              11          29,750              32
Nevada..........................................          24,070               8           3,090              26
New Hampshire...................................          20,650               9           4,190              28
North Carolina..................................         211,820              14          37,670              43
Pennsylvania....................................         324,720              11          64,110              32
South Carolina..................................         109,380              15          18,370              46
Texas...........................................         464,330              14          87,930              43
Utah............................................          26,310               9           4,920              27
Washington......................................          96,990               9          18,960              28
Wisconsin.......................................         110,140              10          24,320              29
----------------------------------------------------------------------------------------------------------------

    The data was calculated in 1997 by Emilie Schmeidler and Drew 
Halfmann, Programs and Policy Research, American Foundation for the 
Blind. It was based on state populations from the 1995 census.
                                 ______
                                 
      Prepared Statement of the American Foundation for the Blind
Introduction
    The mission of the American Foundation for the Blind is to enable 
persons who are blind or visually impaired to achieve equality of 
access and opportunity that will ensure freedom of choice in their 
lives. AFB accomplishes this mission by taking a national leadership 
role in the development and implementation of public policy and 
legislation, informational and educational programs, and quality 
services.
    We appreciate the opportunity to submit our appropriations 
recommendations for fiscal year 1999 to the Subcommittee on Labor, 
Health and Human Services, Education and Related Agencies. This 
document is presented in tabular summary form to facilitate its 
readability. Additional information to substantiate the rationale for 
each funding recommendation will be furnished to the Subcommittee upon 
request. Please note that the recommendations (in millions of dollars) 
contained herein do not reflect adjustments for inflation. Therefore, 
if our recommended amount for each program or activity cannot be 
appropriated, we urge the Subcommittee to increase the appropriation by 
at least a factor for inflation.

Individuals with Disabilities Education Act national activities 
personnel preparation to improve services and results for children with 
disabilities

                    [Part D. subpart 2; section 673]

          

Fiscal year 1997 appropriation....................................$93.33
Fiscal year 1998 appropriation....................................  82.1
Fiscal year 1999 authorization...................................( \1\ )
President's fiscal year 1999 request..............................  82.3
AFB fiscal year 1999 recommendation...............................  90.0

\1\ Such sums.

    We remain seriously concerned about adequately funding personnel 
preparation to address the shortage of teachers who are trained to deal 
with the unique needs of blind or visually impaired children. We 
suggest that a funding priority be established for preparation of 
personnel to address this need. The shortage in the field is 
tremendous; within special education, the shortage of personnel for 
instruction of students with visual impairments ranks second when 
measuring staffing needs. Only the need for teachers of students with 
multiple disabilities, many of whom also have visual impairments, is 
greater in terms of shortages. We are concerned that the restructuring 
of the personnel preparation section and the addition of the new State 
Improvement Grants to address some of the personnel preparation needs 
in the states (and a necessary appropriation for that section), may 
cause a diminution in the appropriation for the personnel preparation 
programs that remain under federal control. A priority with sufficient 
funding is necessary to guarantee an adequate number of qualified 
personnel who can instruct blind and visually impaired students in such 
specialized services as orientation and mobility and the use of 
braille. These are skills which Congress recently recognized in the 
IDEA reauthorization as important to such children's education.

Individuals with Disabilities Education Act technology development, 
demonstration, and utilization, and media services

                    [Part D. subpart 2; section 687]

          

Fiscal year 1997 appropriation.................................... $30.0
Fiscal year 1998 appropriation....................................  34.0
Fiscal year 1999 authorization...................................( \1\ )
President's fiscal year 1999 request..............................  34.0
AFB fiscal year 1999 recommendation...............................  45.3

\1\ Such sums.

    Access to adaptive technology, such as talking computer terminals, 
has a significant impact on the appropriate education for children who 
are blind or visually impaired. In addition, incentives for development 
and availability of new technologies as funded under this part are of 
crucial importance to students with low incidence disabilities, 
including those who are blind or visually impaired, because of the 
small size of potential markets.
Video Description
    This recommendation includes $3.0 million for video description 
which is a $1.5 million increase over the 1998 allocation. Video 
description provides blind persons with narration of visual elements of 
television, cinema, and performing arts. The reauthorization of IDEA 
includes language limiting, beginning in 2001, the video description or 
captioning that can be funded under this section. Part of the rationale 
for the limiting language is that the transition to private funding of 
captioning should be well underway by that time due to the publication 
of the Federal Communications Commission's regulations on captioning in 
August 1997. However, the FCC has not regulated on video description 
and hence there will be no requirements for video described programming 
which would attract private funding. Additionally, video description is 
a newer technology which is not as advanced as captioning in its 
movement toward the development of private funding sources. In the 
eight years that funds have been available for video description 
production and research, the allocation has fluctuated between $1 
million and $1.5 million.

Individuals with Disabilities Education Act Services for Deaf-Blind 
Students

                         [Section 661(i)(1)(A)]

          

Fiscal year 1997 appropriation....................................$12.83
Fiscal year 1998 appropriation..........................................
Fiscal year 1999 authorization..........................................
President's fiscal year 1999 request....................................
AFB fiscal year 1999 recommendation...............................  29.2

\1\ Such sums.

    The discretionary programs reorganized by the IDEA Amendments of 
1997 no longer provide a separate programmatic line for deaf-blind 
centers and services. However, Congress recognized the importance of 
the federal role in providing services to this population by including 
services to deaf- blind students in several sections of newly 
reauthorized Part D (technical assistance, regional resource centers) 
and by maintaining the floor of $12.83 million in the 1997 
appropriation below which total funding for these students would not 
fall (Section 661(i)(1)(A)). While this is no longer a line item, we 
believe that this floor does not take into account the current needs of 
this population which now numbers 11,000 children, an all-time high. We 
believe that direction from the Subcommittee to recognize the need for 
increased funding to this population is imperative to assure that the 
$12.83 million floor does not become a ceiling beyond which additional 
funding will not be provided. The currently identified population of 
11,000 children is an all-time high. Of these children, 5,000 are being 
educated in the local school districts which means that coordinators 
must provide technical assistance in very wide geographic areas. This 
has resulted in an increasing number of special educators and general 
educators who need basic training in instruction of the children who 
are deaf-blind.

Rehabilitation Services Independent Living Services for Older Blind 
Individuals--Title VII, Chapter 2



Fiscal year 1997 appropriation.................................... $9.95
Fiscal year 1998 appropriation.................................... 11.00
Fiscal year 1999 authorization..........................................
President's fiscal year 1999 request..............................  11.2
AFB fiscal year 1999 recommendation...............................  13.0

    The recommended appropriation level will trigger the formula 
funding mechanism established by Congress in the 1992 amendments to the 
Rehabilitation Act. At that level, each state would receive a minimum 
of $225,000. States with larger populations of older individuals would 
receive proportionately larger amounts. There is no other national 
service delivery program specifically targeted for older individuals 
who are blind. Funds for vision-related rehabilitation services for 
older people who are blind are not provided through the Older Americans 
Act, Medicare, Medicaid, or any other consistent funding mechanism. 
Prevalence data for severe vision impairment calculated from the 1995 
Census Survey of Income and Program Participation shows, for example, 
that, in Pennsylvania, 11 percent of the population over age 55 and 32 
percent of the population over age 85 has either difficulty seeing 
words and letters in ordinary newsprint even with glasses or contacts 
or can't see words and letters in newsprint at all. (Attachment A) In 
Iowa this prevalence rate is 10 percent for individuals over age 55 and 
29 percent for individuals over age 85.

Rehabilitation Services Rehabilitation Training

                    [Part D. subpart 2; section 687]

          

Fiscal year 1997 appropriation................................   $399.63
Fiscal year 1998 appropriation................................     39.63
Fiscal year 1999 authorization..........................................
President's fiscal year 1999 request..........................      33.7
AFB fiscal year 1999 recommendation...........................      43.6

    Long-term grants under the Rehabilitation Act provide the only 
source of funding for college-based programs to train orientation and 
mobility instructors and rehabilitation teachers for the blind. As a 
result of the 1992 amendments to the Rehabilitation Act, the 
eligibility rate for clients has increased. The pending 1998 amendments 
to the Act will reenforce that trend. The services of these 
professionals are extremely important to the needs of people who are 
newly blind and eligible for rehabilitation services. The services 
these specialists provide include: using specialized adaptive devices 
and techniques for personal management at home and at work; using 
adaptive computer equipment to read information and using braille and 
other methods to take notes and maintain files; and using specific 
orientation and mobility techniques for safe and independent travel.

Rehabilitation Services Braille Training Projects

                          [Section 803, part B]

          

Fiscal year 1997 appropriation..........................................
Fiscal year 1998 appropriation..........................................
Fiscal year 1999 authorization..........................................
President's fiscal year 1999 request....................................
AFB fiscal year 1999 recommendation...............................   1.0

    Since fiscal year 1993, more than $2.2 million has been allocated 
to the effort to increase braille literacy by the Department of 
Education. Although the authority for funding these projects is 
contained in Section 803 of the Rehabilitation Act, allocations for the 
projects were made from funds appropriated for Title III Special 
Demonstration Programs as a result of the budget scoring agreement with 
regard to Title VIII programs. These braille training projects provide 
braille literacy training to rehabilitation professionals, parents of 
blind children, and family members of blind individuals in the form of 
instructional materials such as computer tutorials and the creation of 
a national network of experts in teaching braille.

Helen Keller National Center for Deaf-Blind Youth and Adults

          

Fiscal year 1997 appropriation.................................... $7.34
Fiscal year 1998 appropriation....................................   7.5
Fiscal year 1999 authorization...................................( \1\ )
President's fiscal year 1999 request..............................   8.2
AFB fiscal year 1999 recommendation...............................   8.6

\1\ Such sums.

    The Helen Keller National Center is the only entity in the world 
whose sole mission is to provide comprehensive training, independent 
living skills, and employment preparation to young people and adults 
who are both deaf and blind. HKNC also provides technical assistance 
and training to public and private service providers. Currently, there 
are more than 11,000 deaf-blind children under the age of 22--the 
greatest number in our history--who will need such services. This 
increase will also allow for urgent building repairs as well as 
equipment and training in computer and other technologies.

American Printing House for the Blind

          

Fiscal year 1997 appropriation.................................... $6.68
Fiscal year 1998 appropriation....................................   8.2
Fiscal year 1999 authorization...................................( \1\ )
President's fiscal year 1999 request..............................   8.3
AFB fiscal year 1999 recommendation...............................   9.2

\1\ Such sums.

    The American Printing House for the Blind provides special 
education teaching aids for students who are blind, provides braille 
textbooks for elementary and secondary students, and develops tape 
recorders and other devices used by blind or visually impaired 
students. Most of these products would not be commercially available 
because of the limited market for these products. Decisions and 
procedures regarding the selection, purchase, distribution, and 
recirculation of these products reside at the state and local levels, 
where assessment of students can best drive such decisions. The 
increase will permit APH to increase the per capita allocation to 
states for textbooks and other educational materials and to develop 
guidelines for computer-administered testing of visually impaired 
students.
                                 ______
                                 
 Prepared Statement of Wanda K. Jones, Dr. P.H., Public Health Service 
   Office on Woman's Health, Department of Health and Human Services
    I am delighted to have an opportunity to provide information on the 
National Osteoporosis Educational Campaign; a public/private 
informational campaign designed to improve the quality of life and 
reduce health care costs for America's aging population.
    At least 25 million Americans are afflicted with osteoporosis, most 
of them women. Osteoporosis robs bones of their mineral and organic 
reinforcements, decreasing bone density and increasing susceptibility 
to fractures. It is a major underlying cause of bone fractures in older 
women, often taking away their independence at a time they should be 
enjoying life. Women with bone fractures can even die from surgery-
related complications, with a reported mortality rate of 20 percent in 
the first post-surgery year for women.
    We are lucky to live in a time with new medications that can help 
prevent or treat osteoporosis. Even so, this disease leads to 1.5 
million fractures a year, mostly in the hip, spine and wrist, and costs 
$10 billion annually.
    Much of the pain, suffering and costs associated with osteoporosis 
could be avoided if women would take preventive measures early in life. 
Current evidence indicates that young women can increase their peak 
bone mass, promote long-term bone health, and reduce the risk of 
disease later in life by following effective dietary, exercise, and 
lifestyle practices. Yet we have so far not been able to effectively 
communicate this prevention message to young women. Studies show that 
less than 25 percent of adolescent females get the required daily 
allowance of calcium; the prevalence of smoking among female high 
school seniors now exceeds that for their male counterparts; over 18 
percent of all adolescent females in a recent survey had used alcohol 
in the preceding month; vigorous physical activity was significantly 
less common among female high school students than among male students; 
and 95 percent of anorectic and bulimic patients were adolescent 
females.
    In September 1996, the U.S. Public Health Service's Office on 
Women's Health (PHS OWH) convened a task force to design a blueprint 
for a national osteoporosis education campaign. The Task Force 
recommended that getting osteoporosis prevention messages to the 13 to 
18 year old group should be a priority. These are the years appear when 
girls begin making their own decisions about diet, smoking, exercise 
and leisure activities, and start shifting away from their parents' 
advice to their peers and the popular media. These are also the years 
when girls are on the verge of accruing 90 percent of peak bone mass. 
The National Osteoporosis Foundation (NOF) and the Osteoporosis and 
Related Bone Diseases National Resource Center (ORBDNRC) subsequently 
recommended that girls ages 9-12 years also be included in this project 
and these organizations have joined with the PHS OWH to develop this 
educational initiative.
    Research reveals that selecting effective health education 
approaches and messages for adolescent females is far from simple. So, 
prior to developing and implementing health education programs targeted 
to adolescent females, the PHS OWH, NOF, ORBDNRC, and the National 
Institutes of Arthritis and Musculoskeletal and Skin Diseases (NIAMS) 
felt it was necessary to conduct a study to determine how to reach 
adolescent females with prevention messages. This study was designed to 
identify effective health education approaches and apply the lessons of 
practical experience to meet health education objectives for target 
populations.
    There were several key strategies used to collect data. First of 
all, an exhaustive search was conducted of the published literature 
using online databases such as Medline to gather findings on adolescent 
females' knowledge, attitudes, and practices concerning bone health and 
the prevention efforts aimed at this population. Secondly, a 
questionnaire was prepared to use in interviews with representatives of 
organizations that have developed messages and implemented programs for 
adolescent females, including the NHLBI Education Programs Information 
Center, the National Maternal and Child Health Clearinghouse for 
Alcohol and Drug Information, Girl Scouts of the USA, Future Homemakers 
of America, Inc., and Girls Clubs of America. Thirdly, baseline data 
was gathered on adolescent females' knowledge of bone health and its 
relative importance to them. And finally, adolescent and young women 
representing diverse population groups ages 9 to 18 were recruited for 
focus groups to solicit and explore their responses to prepared 
questions concerning their knowledge of bone health and preferred 
prevention messages, approaches, and channels.
    The principles, patterns, and criteria for developing message 
content, designing effective approaches, selecting and using channels, 
and addressing adolescent populations were identified. Apparent gaps in 
the knowledge base and any conflicting findings were also highlighted.
    From the findings of this study, the PHS OWH is collaborating with 
the Centers for Disease Control and Prevention (CDC), the National 
Institutes of Health (NIH) and the NOF to establish a national 
education campaign on osteoporosis to increase bone healthy behaviors 
of women and their understanding of the importance of bone health. 
Attention will first be placed on 9 to 12-year-old girls, just 
approaching their peak bone building years, but as the campaign 
develops, it will expand to cover 13 to 18-year-old girls. An 
interesting finding of this recent study is that it is important to 
make efforts to change the behaviors of parents, who are critical role 
models on these issues for pre-teens. Thus, parents will also be 
targets of an expanded educational program.
    The PHS OWH, NIH, CDC, and NOF would like to see significant 
strides made to reverse the current trend in teen health so that there 
is a marked increase in physical activity, a greater consumption of 
calcium among 9-18 year olds, and adoption of other healthy lifestyle 
behaviors associated with bone health. We believe a long term national 
campaign can help effect these changes and are committed to working 
with our collaborators to ensure that this educational program can 
continue past the initial year of funding provided by the PHS OWH.
    In the past century, we have done much to increase the life 
expectancy of women. As a result, in the next century we will see a 
significant increase in the number of older women in our population. We 
must use visionary, long-term strategies to ensure that these bonus 
years for women are fruitful, rewarding and comfortable. Only by 
preparing women in their pre-teen and teen years for a lifetime of good 
health will we achieve that goal.
                                 ______
                                 
  Prepared Statement of Cornelius J. Pings, President, Association of 
                         American Universities
    The Association of American Universities (AAU), an organization of 
62 public and private research universities across the U.S. and Canada, 
appreciates this opportunity to submit for the record testimony in 
support of the fiscal year 1999 budget for the National Institutes of 
Health (NIH) and the Department of Education's graduate education 
programs. We are joined in this statement by the American Council on 
Education and the National Association of State Universities and Land-
Grant Colleges. AAU has also submitted separate testimony with these 
two organizations on behalf of the important Federal student aid 
programs funded by this Subcommittee.
    We address the Subcommittee at a time of great promise for 
biomedical research. We are very grateful for the Subcommittee's 
consistent, strong support of NIH. You have been strong advocates of 
biomedical research, even when reductions were being made elsewhere in 
your appropriations bill. Your commitment to the biomedical enterprise 
has done much to create the current atmosphere in which support for NIH 
is spreading throughout the country and the Congress. We are greatly 
heartened by this groundswell of public sentiment for investing in 
biomedical research and the possibility that the burgeoning economy and 
the fiscal accomplishments of Congress will permit the lifting of the 
yoke of deficits to finance this priority.
    You have received testimony from many witnesses which describes the 
tremendous opportunities in science and the breathtaking speed at which 
discoveries are being identified--discoveries which ultimately will 
unlock the key to disease and hold the promise of improved health for 
our citizens.
    The AAU takes pride in the fact that so much NIH research is 
conducted on the campuses of AAU institutions--at their graduate 
schools and academic medical centers. In fact, in fiscal year 1997, 
over $4.5 billion was awarded by NIH through its peer review process to 
AAU institutions.
    As institutions which support strong research programs in many 
scientific disciplines--including physics, chemistry, mathematics, 
computer science, and engineering--we want to emphasize that biomedical 
research is heavily dependent on the discoveries and progress of many 
sciences, not just those that are most closely associated with 
biomedical research.
    Dr. Burton Richter, the Nobel Prize-winning physicist at Stanford 
University, uses the example of HIV protease inhibitors to make this 
point. Protease inhibitors were synthesized by chemists based on the 
structure of HIV protease determined by biologists using physicists' x-
ray diffraction techniques. The drug companies then finalized their 
formulations using x-ray beams from synchrotron radiation sources from 
accelerators.
    The AAU calls on Congress to support all science research with 
vigor, not only the biomedical sciences.
    The AAU supports efforts underway throughout the biomedical 
community to increase substantially the funding for NIH. We join the Ad 
Hoc Group for Medical Research Funding in its call for a 15 percent 
increase for NIH in fiscal year 1999, as the first step in a five-year 
effort to eventually double NIH funding. As was indicated earlier, we 
feel it is important that the other sciences receive similar support. 
We are greatly encouraged by the President's request for an 8.4 percent 
increase for NIH as the starting point for the debate this year on the 
NIH appropriation.
    As enthusiastic as we are about the goal of increasing NIH funding 
by 15 percent this year, we must emphasize that stability in funding 
over a multi-year period is crucial to progress of science. Dramatic 
fluctuations in funding increases may well be more harmful to 
biomedical science than consistent modest increases. Science cannot be 
conducted productively in single year increments--one year of generous 
resources, the next with cutbacks and constraints.
    In advocating significant increases in NIH funding, we are acutely 
aware that these levels are very unlikely to be reached under the 
current discretionary spending caps without damage to the other 
important programs funded by this Subcommittee. We encourage Congress 
to consider making support for NIH at higher levels possible by 
identifying additional resources, such as through investing a potential 
budget surplus or designating revenues from a possible tobacco 
settlement.
    We realize that the scientific community and the Congress have a 
grave responsibility to taxpayers to defend funding increases of the 
magnitude we are advocating. We feel confident that the scientific 
fields can support high quality research at these levels. The way in 
which science is now conducted is virtually transforming the activities 
and structure of the modern laboratory. For instance, the human genome 
project requires computing and informatics capacity that would have 
seemed unfathomable fifteen years ago. Substantial new resources could 
be applied to providing the new technologies and the properly trained 
personnel to help usher in a new era of scientific achievement. Our 
organizations hope to play a part in spurring the scientific 
leadership, both at NIH and among its extramural partners, to engage in 
comprehensive, ``outside the box'' planning for how significant 
spending increases could most productively be spent.
    AAU would like to highlight needs which have too often been given 
short shrift and which should be addressed if new resources become 
available. AAU continues to emphasize the investigator-initiated grant 
as the bedrock on which the successful NIH enterprise is built. But we 
also want to focus attention on pressing needs in two areas: clinical 
research and institutional infrastructure.
    The dominance of market forces in the health care system has 
drained resources that previously had been used to subsidize clinical 
research and support clinical investigators. Training and career 
support for clinical researchers at all levels--post-doctoral, new and 
junior researchers, and established investigators--need strengthening. 
The General Clinical Research Centers program, which supports inpatient 
and outpatient research facilities, trained research support staff, 
career training, and other resources crucial to clinical research, 
should be targeted for additional resources.
    The second area of concern is institutional infrastructure. 
Individual research efforts cannot thrive without buttressing some of 
the critical infrastructure needs of the biomedical enterprise. 
Additional resources need to be invested in renovating outdated 
facilities, supporting animal research facilities, financing state-of-
the-art instrumentation and developing new research technologies. In 
addition, the AAU encourages Congress to consider reinstituting a peer-
reviewed, accountable institutional grant program that can be targeted 
to specific institutional needs, such as bridge grants for 
investigators, support for trial projects and unorthodox research 
ideas, aid for new investigators, and the acquisition of expensive 
shared resources.
    We would like to conclude with a few words about graduate 
education. AAU continues its strong support of the graduate education 
programs funded by this Subcommittee--those authorized by Title IX of 
the Higher Education Act. These programs are the only source of 
fellowship support for extremely well-qualified students who have 
financial need in disciplines such as the humanities, which are not 
supported elsewhere in the Federal budget.
    Thank you for this opportunity to express our views and add our 
voices to the growing chorus of advocates for biomedical research.
                                 ______
                                 
     Prepared Statement of the American Association of Blood Banks
    The American Association of Blood Banks (AABB) offers this 
statement in support of increased funding for the National Institutes 
of Health (NIH) and the National Heart, Lung, and Blood Institute 
(NHLBI). The AABB appreciates the generous support that transfusion 
medicine researchers have received from the NIH through the 
Congressional appropriations process. This statement discusses the 
current state of transfusion medicine research and signals areas that 
the Association believes merit continued research support.
                the american association of blood banks
    AABB is the professional society for 8,500 individuals involved in 
blood banking and transfusion medicine. AABB also represents more than 
2,200 institutional members including community and Red Cross blood 
collection centers, hospital based blood banks, and transfusion 
services as they collect, process, distribute, and transfuse blood and 
blood components. AABB members are responsible for virtually all of the 
blood collected and more than 80 percent of the blood transfused in 
this country. Throughout its 50-year history, the AABB's highest 
priority has been to maintain and enhance the safety of the nation's 
blood supply.
    Many AABB physicians and scientists conduct research designed to 
assure that the American people have access to the safest transfusion 
services possible. The NIH and other federal agencies fund much of this 
research.
    The National Blood Foundation (NBF), founded in 1983, supports 
patient and donor care through medical research and education as a 
program of the AABB. The AABB is developing a cadre of transfusion 
medicine researchers by supporting early career research in issues 
affecting transfusion medicine. NBF grant recipients have the 
opportunity to demonstrate superior research ability in NBF grant 
sponsored research which often enables them to secure larger grants for 
additional research from the NIH.
              scope and importance of transfusion medicine
    Transfusion Medicine is a multidisciplinary specialty encompassing 
both clinical practice, broad research responsibilities and 
professional and public education activities. Each year in the United 
States, more than 23 million units of blood components are transfused 
into approximately four million patients, providing fundamental support 
for many different surgical and medical treatments. Blood is needed for 
the care of patients with cancer; for accident and burn victims; for 
newborn babies needing intensive care; for transplant patients; for 
millions of patients who undergo surgery; and for individuals with 
heart, lung, liver or bowel diseases. A ready supply of safe blood is 
also vital to the military. Future advances in the health care of the 
nation will depend on continued progress in the provision of safe and 
effective transfusion services.
    As a direct result of transfusion medicine research--much of it 
funded by the federal government through the NIH--the United States 
blood supply is now safer than ever.\1\ The NIH is currently sponsoring 
several important transfusion medicine research projects that can be 
expected to lead to further improvements in the safety and efficacy of 
blood transfusion. However, there are important research opportunities 
in this field that require additional investigation to assure that 
patients have access to the safest possible blood supply.
---------------------------------------------------------------------------
    \1\ A General Accounting Office (GAO) report on blood safety 
released on March 12, 1997, entitled ``Blood Supply: FDA Oversight and 
Remaining Issues of Safety,'' found that overall, the blood supply ``is 
very safe.''
---------------------------------------------------------------------------
            recommendations for improving transfusion safety
    Despite the great progress that has been made in the selection of 
donors who are at low risk for disease transmission and the use of and 
improvements to an extensive battery of tests to eliminate infected 
donors, the prevention of HIV and other transfusion-transmitted 
infections remains a top priority of transfusion medicine researchers 
and all recipients of blood. The AABB urges the NIH to continue 
research into the development of enhanced infectious disease tests and 
donor screening methods to further improve blood safety.
Prevention and Early Detection of Transfusion Transmitted Pathogens
    Current blood screening tests detect the presence of the antibodies 
produced in response to the targeted virus, rather than the virus 
itself. Each improvement to the test has lead to a decrease in the 
``window period'' (the period of time between infection with a viral 
disease such as AIDS and Hepatitis C and the ability to detect the 
virus via screening tests).
    To improve infectious disease tests even more, the NHLBI is funding 
research into the use of gene amplification technology for the 
detection of the genetic material of viruses that cause AIDS and 
Hepatitis C. If successful, this research could lead to blood screening 
tests that further reduce the window period. However, before this 
technology can be implemented for screening blood collected for 
transfusion, more research is needed to address substantial technical 
and operational challenges.
    Pathogen Inactivation.--The risk of acquiring identified pathogens 
through transfusion is lower than ever, yet world-wide travel and 
changing demographics could spread new viruses, bacteria and parasites 
into the U.S. blood donor population. Therefore, the prevention of 
transfusion transmitted diseases remains a top priority of transfusion 
medicine research. Whereas certain technologies are already under 
development with private sector support, newly emerging strategies 
which hold promise for pathogen inactivation need federal grant 
support.
    For example, to address these threats, technologies to sterilize 
cellular blood components are under development. Unfortunately, current 
sterilization methods also damage or destroy the blood cells. 
Nevertheless, emerging strategies hold promise for pathogen 
inactivation that does not impair the efficacy of cellular blood 
components. The AABB is pleased that the NHLBI co-sponsored with the 
FDA last year, a workshop on pathogen inactivation and is funding 
research on viral and pathogen inactivation in cellular blood 
components with clinical trials. Research in this area is also 
proceeding in the private sector.
    Support is needed for research on pathogen inactivation related to 
CMV transmission. Additionally, support is needed for research that 
explores the biology, transmissibility and inactivation potential of 
Creutzfeld-Jakob disease, and other spongiform encephalopathies 
referred to as CJD.
    Donor Screening.--Donor questioning is a critical step in 
maintaining a safe blood supply. Over the years, the questions 
presented to blood donors have been continuously revised, and today, 
questioning more directly addresses issues such as travel to regions 
with endemic disease patterns and sexual and drug use patterns. As a 
result of improved donor screening and education efforts, the volunteer 
donor pool is now primarily comprised of persons with lower infectious 
disease risks.\2\
---------------------------------------------------------------------------
    \2\ General Accounting Office report on blood safety released on 
March 12, 1997, entitled ``Flood Supply: Transfussion-Associated 
Risks.''
---------------------------------------------------------------------------
    Additional research is needed to refine and validate donor 
screening protocols. A report of the NHLBI funded Retrovirus 
Epidemiology Donor Study published in the March 26, 1997 issue of the 
Journal of the American Medical Association concludes that, although a 
stringent donor screening system is in place, a small percentage of 
donors with risk for infectious disease continue to donate blood.\3\ 
Although sophisticated laboratory testing that is conducted on all 
donated blood would have detected virtually all HIV or other infections 
among most of these donors, it is disturbing that this link in the 
blood safety process appears to be incomplete. The AABB urges the NHLBI 
to fund research to develop more effective donor screening methods to 
emphasize the potential adverse impact on patient health of providing 
misleading or inaccurate information during the blood donation process.
---------------------------------------------------------------------------
    \3\ The study found that 186 of every 10,000 survey respondents 
(1.9 percent) reported some risk for infectious disease that would have 
resulted in deferral during the donation process had that risk been 
revealed.
---------------------------------------------------------------------------
evaluation of the role of biological response modifiers in transfusion 
                               reactions
    Lifesaving blood transfusions carry risks other than transmission 
of infectious diseases. Clinical and experimental studies have 
identified several families of molecules which play a significant role 
in altering a patient's response to transfusion. These adverse 
responses (known as transfusion reactions) range from fever, hives, 
shaking chills and low blood pressure to severe allergic reactions, 
shock and even death. Transfusion Medicine researchers now know far 
more about these families of biological response modifiers which 
include histamine, complement, cytokines, bradykinin and other 
biologically active molecules. Studies of the role of these mediators 
in adverse reactions to transfusion and research into how to modify and 
control these response modifiers is needed. Basic and clinical research 
in these areas will provide a fruitful avenue for improving the safety 
of blood transfusion for adult and infant transfusion recipients alike.
                       immunology of transfusion
    Even compatible blood transfusions are recognized by the recipient 
as foreign substances. Though blood transfusion is a lifesaving 
therapy, transfused blood components are still recognized as a foreign 
substance by the human body. It is known that blood transfusion can 
produce adverse changes in the body's natural immune defenses. These 
changes include the potential for decreasing the natural defenses of 
transfusion recipients in their fight against bacterial infection and 
preventing or decreasing the incidence of cancer recurrence. It may 
seem paradoxical, but more and more evidence is accumulating to show 
that blood transfusion may, in certain situations, prove to be a double 
edged sword. Lifesaving transfused blood may actually promote certain 
diseases in the recipient, while preventing the risks of blood loss. 
Bone marrow transplant patients, cancer patients and other 
immunosuppressed recipients, men and women, the very old and the very 
young are all at risk for these types of immunological complications. 
Fundamental basic research by Transfusion Medicine specialists is 
needed to gain vital knowledge on how to combat this adverse aspect of 
blood transfusion. Transfusion researchers are also poised to make 
great strides in understanding the molecular biology and function of 
blood cell antigens.
    Blood transfusion involves the transplantation of living cells from 
the blood donor to the recipient. This procedure can suppress the 
transfusion recipient's immune system, thereby decreasing the 
recipient's defenses against postoperative bacterial infection and 
tumor recurrence. Preliminary research suggests that when standard 
blood components are modified in certain ways, such as by exposure to 
gamma irradiation or by removal of donor leukocytes or donor plasma, 
the immune altering effect of transfusion may disappear. The role of 
cytokines as mediators of transfusion-associated immune modulation may 
represent a possible avenue of research.
    Blood transfusion can also stimulate immune reactions to tissue 
(HLA antigens), platelet antigens, and red cell antigens, significantly 
impairing the ability to support transfusion-dependent patients. The 
AABB urges the Subcommittee to support research to prevent transfusion 
related immune suppression.
               peripheral blood stem cells and cord blood
    Red blood cells that carry oxygen, white blood cells that fight 
disease and platelets that stop bleeding are all produced from a single 
progenitor cell known as a hematopoietic stem cell. Transplants of 
these stem cells are increasingly replacing bone marrow transplants for 
reconstituting bone marrow in chemotherapy patients. Because of their 
ability to multiply into many different types of blood cells, stem 
cells may also become the ultimate vehicle for curing diseases through 
gene therapy.
    Recently, it has been found that considerable quantities of stem 
cells can be collected from the blood stream. Stem cells are also 
increasingly collected from the blood remaining in the placenta and its 
attached umbilical cord after delivery of newborn babies. Although the 
total volume of blood is small and is normally discarded after birth, 
research indicates that the amount of stem cells is great enough to 
perform stem cell transplantation in children with leukemia and other 
diseases.
    The AABB is pleased that the NHLBI is funding a five-year multi-
center study of the transplantation of stem cells collected from cord 
blood. To establish the necessary infrastructure for this research, the 
institute established a network of umbilical cord blood banks and 
transplant centers. This research will help determine the clinical 
efficacy of cord blood stem and progenitor cell transplants.
    This initiative is expected to pose new questions on the proper use 
of peripheral blood stem cells and cord blood. A variety of both 
biological and technical issues require continued investigation. These 
include proper immunologic and functional characterization of the stem 
cell, investigation of methods of stimulating stem cell production in 
normal donors, and optimum methods for the collection, processing and 
storage of stem cells. The AABB supports basic and applied stem cell 
research.
    Improving Transfusion Medicine research training and its clinical 
research infrastructure is vital to furthering Transfusion Medicine 
research productivity. Such an infrastructure is currently nonexistent. 
Accordingly, the AABB supports development of a system of linked 
Centers of Transfusion Excellence for Research and Training. Such 
Centers could provide the critical mass of resources needed the to 
accomplish NIH/NHLBI sponsored research initiatives in the Transfusion 
Medicine areas outlined above.
                    fiscal year 1999 funding levels
    The AABB is sensitive to the many demands on the discretionary 
funds in the federal budget. However, we view medical research funding 
as an investment in America's future competitiveness. Consistent with 
the Ad Hoc Group for Medical Research Funding, the AABB endorses a 15 
percent increase in NIH funding for fiscal year 1999 as a first step 
toward the goal of doubling the NIH budget over the next five years. 
This recommendation is consistent with recently articulated 
congressional support for doubling the amount authorized for basic 
science and medical research for a number of research agencies, 
including the NIH. Additionally, this level of funding would sustain 
the current rate of growth NIH has experienced during the past decade.
    On behalf of the many scientists devoted to improved blood 
transfusion practice, the thousands of health care professionals who 
work daily to deliver blood services, and the millions of American 
transfusion recipients, the AABB appreciates this opportunity to 
discuss federal support for research in transfusion medicine before the 
Subcommittee.
                                 ______
                                 
 Prepared Statement of K. Kimberly Kenney, Executive Director, Chronic 
   Fatique Immune Dysfunction Syndrome (CFIDS) Association of America
    Mr. Chairman, thank you for the opportunity to submit testimony to 
the Committee for the third consecutive year. My name is Kimberly 
Kenney, and I am executive director of The CFIDS Association of 
America. The Association is the world's largest and most active 
charitable organization dedicated to conquering chronic fatigue and 
immune dysfunction syndrome, or CFIDS, also known as chronic fatigue 
syndrome or CFS. With more than 23,000 members and a mailing list of 
nearly 200,000, The CFIDS Association is the leading non-profit 
501(c)(3) organization working to conquer CFIDS. In its mission to 
conquer CFIDS, the Association supports education, public policy and 
research programs. Nearly all of the funds which support these programs 
are donated by persons with CFIDS and those who care about them. Since 
our founding in 1987, we have funded over $3.3 million in direct 
research grants and have distributed hundreds of thousands of copies of 
our magazine, The CFIDS Chronicle.
    CFIDS is a serious and complex illness that affects many different 
body systems. The cause has not yet been identified and there is no 
cure. The illness is characterized by bone-crushing fatigue, persistent 
flu-like symptoms, intractable pain and Alzheimer-like cognitive 
deficits. These and other symptoms can come and go, complicating 
treatment and the ability to cope with the illness. In addition, most 
symptoms are invisible, making it difficult for others to understand 
the problems that persons with CFIDS have. The illness is often 
severely disabling and can last for many years. Further, it is often 
misdiagnosed because there is no diagnostic laboratory test and it 
closely resembles other disorders including multiple sclerosis, Lyme 
disease, lupus and post-polio syndrome. Studies using the restrictive 
research definition of CFS have reported that at least 500,000 adults 
in the United States suffer from CFIDS. Although little study has been 
done on CFIDS in children and adolescents, it is clear that kids do get 
CFIDS. The lack of understanding about CFIDS by pediatricians, school 
teachers and administrators and other children can make for a 
nightmarish experience for the young patient and his/her parents.
    The CFIDS Association leads efforts to make CFIDS a recognized 
mainstream medical concern. A foundation of knowledge and experience 
has been created through an expanding research effort. Patient care and 
diagnosis remain more art than science, but meaningful advances promise 
to be imminent and initiatives underway to educate healthcare 
professionals will improve understanding of the complexity of this 
illness among providers.
    I am honored to report to the Committee the progress being made in 
unraveling the mysteries of CFIDS. This committee has provided 
leadership and vision for the federal agencies which must meet the 
needs of persons with CFIDS. The CFIDS-related report language in the 
fiscal year 1998 appropriations bill was greatly appreciated by the 
CFIDS community. I ask for your continued support of activities which 
have been critical to this improved understanding.
    Please allow me to recount some of the specific accomplishments of 
the past year that underscore the value of continued federal investment 
in these activities:
  --In its first year, the Department of Health and Human Services 
        Chronic Fatigue Syndrome Coordinating Committee (DHHS CFSCC), 
        on which I serve as one of two patient advocates, has made 
        important progress in raising awareness of CFIDS within the 
        government and coordinating government activities across 
        agencies. Yet its real and potential effects could extend far 
        beyond the government's reach into the general public, the 
        medical community and private research. The Committee's next 
        meeting, April 28-29, will include a day of pediatric CFIDS 
        science designed to identify the most promising areas of 
        investigation. The following day the Committee will establish 
        priorities for action and further inquiry.
  --The Office of the Secretary for Health produced one of 1997's 
        greatest achievements--a medical education program broadcast by 
        satellite across the country. Many federal agencies and patient 
        representatives participated in the creation of this program: 
        it was conceptualized and written by a team of patient 
        advocates and staff from DHHS, the National Institutes of 
        Health (NIH) and Centers for Disease Control (CDC); promoted by 
        the Health Resources and Services Administration (HRSA) and 
        patient advocates; and broadcast on satellite by CDC and over 
        the Internet by a private company.
  --The Association's partnership with HRSA's Area Health Education 
        Centers (AHEC) to promote the satellite program within the 
        health care community was integral to the success of the 
        program. The AHEC system's expertise in training health care 
        workers resulted in 78 satellite viewing sites and over 1,200 
        provider-participants.
  --The extramural CFS research effort at NIH continues to make 
        progress. The National Heart, Lung and Blood Institute's 
        (NHLBI) first CFS research grant was made to Harvard's Roy 
        Freeman, MD, who is investigating abnormalities in the 
        autonomic nervous system. Additionally, the National Institute 
        of Allergy and Infectious Disease (NIAID)-funded CFIDS 
        epidemiology study at DePaul University received a supplemental 
        grant to expand its research of children and adolescents with 
        CFIDS.
  --CDC's CFIDS research program has shown improvement. The second 
        phase of a large community-based study of CFIDS in Wichita, 
        Kan. began in late 1997. CDC's steps to augment its pediatric 
        CFIDS research program, as requested in fiscal year 1998's 
        report language, are very encouraging. In addition, CDC has 
        recommended the creation of a unique ICD-9 code for chronic 
        fatigue syndrome. The new code, 780.71, should improve the 
        tracking of CFS cases in the healthcare system and lead to 
        better reimbursement by insurance companies and more useful 
        epidemiological data.
  --The association between CFIDS and the Gulf War syndrome was 
        strengthened by CDC research which showed that primary symptoms 
        experienced by both groups are the same--fatigue, cognitive 
        abnormalities and widespread muscle and joint pain. This data 
        supports the need for improved communication between civilian, 
        military and government scientists working to define both 
        illnesses.
  --In response to pressure from CFIDS advocates, the Food and Drug 
        Administration (FDA) approved limited distribution and a 
        clinical study of Ampligen, a drug which has shown benefit in 
        treating CFIDS. We remain supportive of this and other studies 
        which give CFIDS patients access to promising drugs at the 
        earliest opportunity.
    These achievements have been facilitated through fiscal year 1997's 
significant, though comparatively small, combined federal investment of 
$14 million. While these accomplishments show clear progress in the 
federal commitment to battling CFIDS, it is apparent that Congressional 
and private support for bolstering this effort is still necessary.
  --Problems with the CDC bureaucracy continue to exist. We have been 
        extremely frustrated in our efforts to track the agency's use 
        of funds allocated to its CFIDS program. In March, CDC 
        officials provided The CFIDS Association with a line-item 
        accounting of its CFS spending in fiscal year 1996 and fiscal 
        year 1997 and a plan for fiscal year 1998 spending. In each of 
        the three years, total spending added up to exactly $5,789,000, 
        but the amount spent in each object class varied widely from 
        year to year (See Appendix). For example, ``Supplies'' were 
        $600,871 in fiscal year 1996, $86,027 in fiscal year 1997 and 
        estimated at $180,222 in fiscal year 1998. We could find no 
        explanation for these spending disparities after reviewing 
        CDC's CFS activities over the past 30 months. Mr. Chairman, we 
        ask that you question CDC officials about this matter when they 
        come before you this spring.
  --Similar difficulties have been experienced with the NIH. Despite 
        repeated requests, NIH delayed for five months before providing 
        a total for fiscal year 1997 funds spent on CFIDS. Despite the 
        generous 7 percent increase Congress provided NIH in fiscal 
        year 1997, total CFIDS funding was 10 percent less than NIH had 
        planned to spend on CFIDS in fiscal year 1997, and it was only 
        2 percent ($150,000) more than was spent in fiscal year 1996. 
        In addition, the fiscal year 1998 estimate is 5 percent below 
        the funding level estimated in 1997. The erosion of NIH support 
        for CFIDS research underscores the need for clearer direction 
        from this Committee.
  --Concerns remain high about the obstacles persons with CFIDS 
        encounter when seeking disability benefits through the Social 
        Security Administration. The SSA's Office of Disability has 
        drafted a ruling to guide the adjudication of CFS disability 
        claims. There are a number of problems with the first draft of 
        the ruling, but SSA has committed to working with The CFIDS 
        Association to improve it. We are cautiously optimistic, and 
        encourage the Committee to reiterate its support for improving 
        SSA's response to CFS disability claims.
  --The scientific advances that have been made, while encouraging, 
        have not helped the individual patients who are desperate for 
        better care. Diagnosis is still made by excluding all other 
        possible causes of symptoms, a long and costly process. 
        Patients who find a physician knowledgeable and willing to 
        treat them commonly experience a discouraging (and potentially 
        dangerous) process of trial and error using any number of 
        usually inadequate symptomatic medicines. Advances in 
        biomedical research still provide the greatest hope for helping 
        individual patients, and we hope the Committee will continue 
        its support of expanded CFIDS research.
  --A broad-based, comprehensive CFIDS education effort could also help 
        individual patients by improving the health care industry's 
        understanding, diagnosis and treatment of CFIDS. The satellite 
        training program was an important first step. There is still an 
        enormous need for more pervasive educational programs which, 
        ideally, would again combine the resources of CDC, HRSA, 
        researchers, clinicians and advocates.
  --Per the Committee's fiscal year 1997 report language, the CFSCC 
        formed a task force to consider the issue of changing the name 
        ``chronic fatigue syndrome'' to one which more appropriately 
        reflects the disease's pathophysiology. The task force 
        determined that, while there is enormous support from all 
        sectors to change the name, science has not progressed to the 
        point of clear consensus for a suitable alternative name. We 
        actively seek to advance understanding so that a less 
        stigmatizing name might be adopted and broadly announced.
    To encourage continued growth in the CFIDS research effort and to 
undertake programs that will begin to address the real-world needs of 
CFIDS patients for earlier detection, better care, and improved access 
to Social Security disability benefits, we must request an expansion of 
resources dedicated to these crucial efforts.
    The CFIDS Association of America offers the following 
recommendations for fiscal year 1999 appropriations and committee 
report language:
Secretary for Health
    The Association requests that Congress earmark $1 million of the 
discretionary funds allocated to the Secretary of Health and Human 
Services to maintain the Department of Health and Human Services 
Chronic Fatigue Syndrome Coordinating Committee (DHHS CFSCC). We ask 
that the Committee include report language directing the use of this 
body to coordinate CFIDS research across the Public Health Service by 
defining priorities and creating a yearly action plan. Included in the 
purview of the CFSCC, we recommend oversight into programs, 
performance, budget allocations and priorities. Finally, we ask that 
the Committee support the renewal of the CFSCC's charter beyond its 
expiration in 1998.
National Institutes of Health
    Despite the Committee's generous report language directing NIH to 
provide additional resources for CFIDS research, it appears that this 
direction has not been heeded by the agency. While the Committee's 
reluctance to earmark funds for medical research is well understood, 
the erosion of NIH funding for CFIDS research underscores the need for 
stronger direction from this Committee. The Association requests that 
Congress appropriate an additional $10 million to NIH for extramural 
grants focused on promising areas of CFIDS research. We support the 
Congressional proposal to double the NIH's budget within the next five 
years, as biomedical research gives us the greatest hope for conquering 
CFIDS. We ask that the Committee include report language continuing to 
direct NIH spending priorities to investigations that will define the 
pathophysiology of the illness and identify diagnostic markers. We also 
request that the Committee include report language establishing the 
need for a special Program Announcement dedicated to the study of all 
facets of pediatric CFIDS. Finally, the Association asks for report 
language urging NIH officials to identify appropriate NIH advisory 
committees for CFIDS representation and ensure appointment of qualified 
persons thereon.
Centers for Disease Control and Prevention
    At the CDC, the Association requests that Congress appropriate a $5 
million increase to expand laboratory studies (including serial 
analysis of genomic expression (SAGE) studies) and surveillance 
projects, including outreach to populations not formerly recognized as 
being affected by CFIDS, namely minority populations and children and 
adolescents. We are concerned that CDC may be delaying the addition of 
a neuroendocrinologist to its CFS research group as directed by the 
Committee, and request reiteration of the Committee's support for this 
addition.
Social Security Administration
    Despite the regular attempts by this Committee to secure the 
attention of SSA officials to the unique problems that CFIDS patients 
encounter in the process of applying for SSDI benefits, the situation 
remains that CFIDS patients regularly encounter SSA employees 
unfamiliar with or erroneously informed about CFIDS and its diagnosis 
and the functional limitations the illness imposes. The Association 
asks the Committee to once again remind SSA, through report language, 
of its support for developing and implementing appropriate training 
agendas and materials for SSA and Disability Determination Service 
employees, and of its support for the formation of an active CFIDS 
advisory committee within SSA. Finally, we request that the Committee 
direct SSA to expedite efforts to investigate obstacles to benefits for 
persons with CFIDS and to keep medical information updated throughout 
all levels of the application and review process.
Health Resources and Services Administration
    The Association requests an appropriation of $500,000 to HRSA to 
develop a training curriculum for health care providers in practice and 
providers in-training through the existing Area Health Education Center 
Program. The curriculum, once distributed, would improve the detection, 
diagnosis, treatment and management of CFIDS patients. Effective 
programs could yield healthcare spending savings equal to many times 
this small investment.
Department of Education
    The Association requests report language directing DOE's Office of 
Special Education Programs to inform educators about CFIDS and the 
special educational needs of students with CFIDS.
    Members of the Committee familiar with our issue will recognize 
some of these requests from previous years. The Association has strived 
to make consistent, reasonable requests with the goal of providing 
greater clarification of issues critical to those who suffer from the 
disease. Using this strategy, we have been rewarded through the 
progress in many areas which I mentioned earlier. However, there are 
still great challenges ahead.
    We sincerely hope that, once again, Congress will work with us to 
secure a dedicated and effective federal response to CFIDS so that we 
can put an end to the suffering caused by CFIDS at the earliest date 
possible. The CFIDS Association of America will continue its efforts to 
inform Congress about CFIDS to secure support for this committee's 
leadership on the illness, as well as that shown by other individual 
Members. We will also continue our efforts to hold the federal agencies 
accountable for the direction delivered by Congress through the 
Appropriations bill and its accompanying report language.
    Mr. Chairman, we have all worked diligently to develop a basic 
understanding about CFIDS. The investment we've made over the last 
decade will soon generate dividends in terms of more definitive means 
of diagnosing, treating and, perhaps, preventing the illness. Your 
commitment to this effort is needed now more than ever. We must 
capitalize on the opportunities now before us so that the children, 
teens and adults with CFIDS experience improved care and function. They 
wish desperately to return to productive lives as students, parents, 
employees and citizens. Thank you for your efforts on their behalf, for 
your attention to our cause and for your thoughtful consideration of 
our requests.

APPENDIX.--CENTERS FOR DISEASE CONTROL AND PREVENTION, NATIONAL CENTER FOR INFECTIOUS DISEASES DIVISION OF VIRAL
                   AND RICKETTSIAL DISEASES CHRONIC FATIQUE SYNDROME DISTRIBUTION OF RESOURCES
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal year     Fiscal year     Fiscal year
                                                                       1996            1997        1998 estimate
----------------------------------------------------------------------------------------------------------------
Estimate personnel..............................................        $980,198      $1,072,006        $987,521
Travel..........................................................          25,290          81,875         117,236
Transportation..................................................              28           1,418          18,568
Rent/communications.............................................           8,750         159,589          90,500
Printing........................................................  ..............           3,894           5,500
Other/miscellaneous.............................................         320,620         172,648         483,046
Supplies........................................................         600,871          86,027         180,222
Equipment.......................................................         599,092         373,917         370,877
Extramural agreements...........................................       1,588,042       2,132,014       1,827,918
                                                                 -----------------------------------------------
      Total direct program costs................................       4,262,947       4,083,388       4,083,388
                                                                 ===============================================
Program support costs\1\........................................       1,526,053       1,705,612       1,705,612
                                                                 -----------------------------------------------
      Total costs attributed to CFS research at CDC.............       5,789,000       5,789,000      5,789,000
----------------------------------------------------------------------------------------------------------------
\1\ Overhead to the National Center for Infectious Diseases and the Centers for Disease Control

                                 ______
                                 
 Prepared Statement of John S. Gustafson, Executive Director, National 
      Association of State Alcohol and Drug Abuse Directors, Inc.
    Mr. Chairman and Committee Members, my name is Jack Gustafson and I 
am the Executive Director of the National Association of State Alcohol 
and Drug Abuse Directors or NASADAD.
Appropriations request
    Thank you for the opportunity to submit this testimony on the need 
for the Federal government to make an increased investment in the 
provision of alcohol and other drug prevention, treatment and research 
services. Specifically, we are supporting a 15-percent increase of $254 
million to the Substance Abuse Block Grant that is currently funded at 
$1.36 billion. The funding level of $1.36 billion includes a 2-year 
transfer of $50 million appropriated to provide treatment to former 
recipients of Supplemental Security Income (SSI) and Social Security 
Disability Income (SSDI). Although the legislative authority for this 
additional $50 million was only for fiscal year 1997 and fiscal year 
1998, we are urging that this level of funding be maintained based on 
the need for treatment.
    We are also supportive of funding increases to the following other 
programs:
  --$180 million each for the Centers for Substance Abuse Prevention 
        and Treatment to support Knowledge Development and Application 
        (KDA) programs;
  --$611 million for Safe and Drug Free Schools and Communities;
  --$262.2 million for the National Institute on Alcohol Abuse and 
        Alcoholism and
  --$658.9 million for the National Institute on Drug Abuse.
    In supporting these increases, we emphasize the need for new and 
stronger linkages between these Federal programs and the Substance 
Abuse Block Grant that is the primary commitment to Federal funding and 
partnership with the states.
About NASADAD
    NASADAD represents the concerns of State Alcohol and Drug Abuse 
Directors who administer and fund prevention and treatment services 
through a network of over 7,000 primarily not for profit community 
providers. State agencies provide a wide array of treatment, 
prevention, and support services to Americans of all income levels. 
Because substance abuse is a critical concern for many health and 
social service systems-our members are actively involved in issues such 
as AIDS, tuberculosis, health services for pregnant and parenting 
women, welfare reform, child abuse and neglect, employment, juvenile 
crime, and criminal justice.
Three key issues
    I would like to discuss three key issues:
    Welfare reform and need for treatment.--It is estimated that over 1 
million welfare mothers have a substance abuse problem that requires 
treatment. As welfare reform is implemented, States are under pressure 
to find the resources needed to provide treatment services to get these 
mothers back to work. There are now long waiting lists for treatment. 
Without new dollars, it will be difficult for moms receiving Temporary 
Assistance for Needy Families (TANF) and others in need to receive 
appropriate treatment.
    Prevention.--Prevention of alcohol and other drug problems in our 
youth remains a high priority. As a Nation, we continue to be alarmed 
by the number of youth who are initiating alcohol and drug use. The 
Office of National Drug Control Policy (ONDCP) has begun its media 
campaign on drug prevention in earnest. Now it is up to States to 
provide programs that will meet the increased demand for prevention 
services that can logically be expected as a result of that campaign.
    Formula consensus.--State Alcohol and Drug Abuse Agencies take 
seriously the charge given last year by House and Senate appropriators 
to work closely with the authorizing committees, SAMHSA, and the field 
on developing consensus on the formula issue.
Substance abuse problems
    It is important to have a sense of the scope of the problem as 
funding decisions are considered. The National Household Survey on Drug 
Abuse, funded by the Department of Health and Human Services, provides 
a good overview of the extent of alcohol and drug abuse problems in our 
country. Here are the most current statistics:
  --13 million Americans use illicit drugs.
  --9 million youths (under age 21) consume alcohol. Of these, 4.4 
        million are binge drinkers, including 1.9 million heavy 
        drinkers.
  --An estimated 10.1 million Americans use marijuana or hashish. Of 
        these, 2.4 million are new users, many of whom were youth.
  --The number of cocaine users is 2.6 million.
  --There were an estimated 141,000 new heroin users in 1995. Most of 
        these new users were under age 26. The rate of heroin 
        initiation for the age group of 12-17 reached historic levels.
  --More than half of the youths ages 12-17 reported that illicit drugs 
        like marijuana and heroin were easy to obtain. 15 percent of 
        youths reported being approached by someone selling drugs.
Public system
    Now that you have an idea of the extent of the problem, I would 
like to share with you information about our current treatment and 
prevention efforts. In 1995, State Alcohol and Drug Agencies 
administered over $4 billion in substance abuse services. This level of 
funding supported nearly 1.9 million treatment admissions for alcohol 
and other drug problems. Also out of the $4 billion, States spent over 
$583 million on prevention services.
    The Substance Abuse Block Grant is currently funded at $1.36 
billion and is the primary federal commitment to substance abuse 
prevention and treatment. Twenty percent of the Substance Abuse Block 
Grant is for Prevention. The block grant represents about 1/3rd of 
overall funding for the State publicly supported system.
Number of persons needing treatment
    Every year, NASADAD completes a survey of our State Agencies to get 
a rough estimate of the number of individuals who have requested or 
need treatment services. This survey helps to supplement the national 
estimates that are done on a periodic basis of individuals who have 
drug or alcohol problems.
    States report how many people they currently have on their waiting 
lists as well as make projections about how many TANF or former 
Supplemental Security Income (SSI)/Social Security Disability Income 
(SSDI) recipients need treatment in their individual States. The last 
survey was done in August of 1997 and shows the following:
  --On a national basis, States estimate that more than 1 million 
        individuals need alcohol and other drug treatment.
  --Of that 1 million, there are 52,419 on waiting lists, 240,291 are 
        former SSI/SSDI recipients, and 779,710 are TANF recipients.
    Here are some numbers from that waiting list for a few States 
represented on this Subcommittee: Pennsylvania: 49,721; Iowa: 9,149; 
Wisconsin: 20,858; Texas: 87,917; and North Carolina: 25,108
    It is important to note that these numbers are just the tip of the 
iceberg and were collected prior to implementation of many Federal and 
State welfare reforms. The number of those needing treatment is 
expected to expand exponentially as welfare reform progresses.
Department of Labor--Welfare to work
    NASADAD is well aware of how important our treatment system is to 
getting TANF moms and others back to work. We have been working closely 
with the Department of Labor and the Private Industry Councils (PICs) 
to help assure the success of the 2-year Welfare to Work program 
authorized and funded by Congress last year.
    One thing that is clear to all of us--State administrators, 
providers, employers, and welfare experts--is that the long waiting 
lists for treatment serve as a barrier to getting these moms back to 
work. It is also clear that unless TANF recipients get the treatment 
they need--job retention will be a major problem for families, States, 
and employers.
How States would spend new dollars
    The following are examples of how States would use additional block 
grant funds to meet the need for increased prevention and treatment 
services:
  --First and foremost, reduce the number of people on current waiting 
        lists;
  --Place professional staff in local welfare and Private Industry 
        Councils (PICs) offices to screen TANF recipients and provide 
        intensive case management for those identified as having a 
        substance abuse problem;
  --Develop new services for working TANF recipients such as weekend or 
        evening treatment programs and lunch time prevention education 
        programs;
  --Establish employee assistance programs for employers who hire 
        former welfare recipients with substance abuse problems;
  --Work in concert with child welfare agencies to provide services to 
        children of substance abusers;
  --Expand after-school programs that prevent illicit alcohol, drug, 
        and tobacco use by children and youth.
  --Create new mentoring programs that engage business leaders in 
        reaching out to youth to build esteem and life skills as well 
        as to avoid substance abuse.
Treatment effectiveness
    One question that always arises is: How effective is treatment? I 
am pleased to share that a newly released longitudinal study, funded by 
the National Institute on Drug Abuse, overwhelmingly confirms the 
effectiveness of treatment. The study, called the Drug Abuse Treatment 
Outcome Study or DATOS, tracked more than 10,000 patients in 11 cities 
over a three-year period. Building on two earlier nationwide studies, 
DATOS investigators have amassed a wealth of information on drug abuse 
treatment outcomes, retention rates, and treatment histories.
    Among the patients that DATOS studied, drug use dropped 
significantly from the 12-month period before treatment to the 12-month 
period after treatment began. This was true for all types of treatment 
studied. Treatment also led to significant improvements in other 
aspects of patient's lives--such as reduced involvement in illegal 
activity.
    Another Federal report, The National Treatment Improvement 
Evaluation Study (NTIES), sponsored by SAMHSA studied 5,388 patients 
over a 5-year period. In addition to reducing drug use, NTIES showed an 
18.7 percent increase in employment and a 77.6 percent decrease in 
violent crime.
    The DATOS and NTIES reports also echo findings of States on 
treatment effectiveness. In a NASADAD report. Alcohol and other Drug 
Treatment: Policy Choices in Welfare Reform, States documented 
substantial improvements in employment status and other areas of 
patient lives from before treatment to after treatment:
  --Arkansas had a post-treatment employment increase of 127 percent.
  --A women's treatment program in Pennsylvania found that 80 percent 
        of its graduates remained sober and employed after leaving 
        treatment.
  --A Wisconsin based women's treatment program found that 65 percent 
        of their clients had their children returned out of foster care 
        and 61 percent went to work.
  --Missouri's AOD system found that clients' employment increased by 
        50 percent while their involvement in the legal system was cut 
        in half.
Prevention effectiveness
    Many studies also demonstrate the effectiveness of prevention. A 
1997 NIDA report found that research based prevention programs 
significantly reduces youth alcohol and drug use. A study by Cornell 
University in 1995, found that students who participated in prevention 
programs are 40 percent less likely to use illicit alcohol and drugs.
    We are all very excited about the ONDCP media campaign on drug 
prevention that is now underway--and I am sure that many of you have 
seen the public service announcements on TV or noticed the full page 
ads in the Washington Post and other papers. As a result of this 
campaign, we are anticipating a major increase in the demand for 
prevention services. We will need additional dollars to provide 
prevention programs or we will end up with a situation where 
frustration on the part of parents and communities is an unintended 
result of the media outreach effort. I have already talked about the 
kinds of innovative programs States would initiate with additional 
dollars.
    Let me just add that a Federal commitment of dollars to prevention 
helps to leverage additional State, Community, and volunteer resources 
that are needed to reach our youth and other vulnerable groups.
Formula consensus
    Before I end, I want to note that NASADAD members have already met 
to formulate an agreement on recommendations for the Substance Abuse 
Block Grant Formula. At issue for States is whether or not the current 
formula incorporates the best available data on the need for substance 
abuse services and the cost of delivering these services.
    On January 20 and 21, 12 State Officials--including 7 State Alcohol 
and Drug Abuse Directors--spent over 15 hours in discussions and 
negotiations on the Substance Abuse Formula. This is the first time 
that States have had such an opportunity to provide their input on 
formula elements as other reports were crafted by academic economists 
and policy think tanks. The agreements that were made at this meeting 
are still being vetted so that they will have the benefit of review by 
all the States. But I can share with you the essence of the discussion.
    Fiscal year 1998 base funding essential.--First, States agree that 
large shifts in funding, as proposed by SAMHSA in the last 
appropriations cycle, are disruptive to the service delivery system and 
should be avoided. When one State has a gain of 20 percent in one 
fiscal year, and another States loses 20 percent, dramatic service 
reductions will occur. Individuals and families in treatment will have 
services terminated. In addition, community providers, required by the 
law to be non-profit, will close or down size in the face of cuts. For 
this reason, States agree that a base funding level of the fiscal year 
1998 appropriations for all States should be maintained.
    Study needed.--Second, the proposed shift to non-manufacturing 
wages adjusted for health specific occupations--is some improvement 
over the use of manufacturing wages for the Substance Abuse Block 
Grant. It is by no means adequate. States have concerns that the 
formula does not incorporate the most up to date information on wages, 
or other elements of the cost of services. In addition, the use of 
general population statistics--weighted by age--raises questions. Many 
States and experts believe that other data for measuring the need for 
services would be more accurate.
    It was agreed that a study should be undertaken by an objective 
organization, such as the National Academy of Science (NAS), with input 
from the States, which can more carefully select and recommend the most 
appropriate formula components to Congress. The NAS has completed 
several previous studies on alcohol and other drug issues and health 
outcome measures and is viewed as an objective and reliable body.
    Interim formula.--Finally, States recognize that it could require 
up to two years for such a study to be completed and that a decision 
must be made regarding how new dollars would be allocated in the 
interim. It was agreed that during this interim, the fiscal year 1998 
base for all States should be retained and new dollars would be 
distributed to all States utilizing the non-manufacturing wages 
adjusted for health specific occupations.
    Preliminary talks with the ``field'' of substance abuse indicate a 
general support for this approach. NASADAD will be continuing to 
consult with States, providers, counselors, advocates and others to 
reach a consensus that can be utilized by the authorizing and 
appropriating committees for fiscal year 1999.
    Thank you for the opportunity to submit this testimony.
                                 ______
                                 
    Prepared Statement of Carole S. Downing, MSW, National Multiple 
                           Sclerosis Society
                     national institutes of health
    Current research and treatment possibilities make this the most 
exciting time in the history of MS research. Now is a time to even 
further increase our commitment to NIH. We are extremely grateful for 
the fiscal year 1998 appropriation of $13.6 billion, a 7.1 percent 
increase over the fiscal year 1997 appropriation. We in the MS 
community are pleased with the trend of recent NIH budget increases 
which show the commitment by Congress to NIH and its importance to the 
health of Americans. Thank you, too, for your fervent commitment Mr. 
Chairman.
National Institute of Neurological Disorders and Stroke
    Important intramural and extramural research on the MS disease 
process is being conducted under the auspices of the NINDS. The NINDS 
intramural program is doing several important studies using MRI imaging 
and the drug Betaseron, the very first drug for the underlying disease 
approved by FDA in 1993. The effect of interferon beta lb (Betaseron) 
has now been studied in a group of 14 patients with early mild, 
relapsing-remitting MS to test its ability to reduce alterations in the 
blood-brain barrier. In those studied, all have had a dramatic 
reduction in lesions, with complete cessation of disease activity, as 
measured by MRI, for many. These findings suggest an important site of 
action for beta-interferon, and point to new avenues of research 
involving early drug intervention to be further pursued. The studies 
also provide further evidence of the usefulness of MRI in monitoring 
both disease activity and response to treatment. A study such as this 
could be used as a foundation for more research if there were more 
resources.
    NINDS also supports a substantial program of extramural research on 
MS. If there were more resources, we would suggest that the following 
topics are especially ripe for further examination: sex-based 
differences in disease prevalence and outcomes, regeneration of lost 
myelin and nerve tissue, clinical-pathological correlations of disease, 
and adhesion molecule function in cell traffic across the blood-brain 
barrier. The National Multiple Sclerosis Society and the NINDS have 
identified target areas of MS research with enormous potential for 
investment including:
  --Identifying the targets in the immune-system attacks in MS and 
        developing new methods to block or repair the destruction of 
        the myelin insulation that coats nerve fibers;
  --Investigating cellular and molecular mechanisms underlying 
        recovery, including myelin-producing cells, production of 
        myelin, and regeneration of nerve cells;
  --Conducting early phase clinical trials for new therapeutics that 
        have not been picked up by the research pharmaceutical firms 
        and developing new methods to enhance recovery including 
        further research on the blood-brain barrier; and
  --Increasing the number of MS clinical research centers. These 
        research centers would focus on the interface of basic and 
        clinical research. Such a funding scheme could help build 
        collaborative research efforts to speed transfer of basic 
        research finding to clinical practice and could create a 
        nationwide network of innovative research centers. This is the 
        kind of program that might well be supported jointly between 
        NIH and NMSS.
    The National Multiple Sclerosis Society urges a 15 percent increase 
above last year's appropriation of $780,713,000.00 for the National 
Institute of Neurological Disorders and Stroke. Surely we must step up 
our research on neurological disease when we are so close to more 
significant advances.
National Institute of Allergy and Infectious Disease
    NIAID also conducts research important to solving the puzzle of MS, 
now identified as an autoimmune disease. During the fiscal year 1997 
fiscal year over $21.4 million will be spent on MS specific research 
projects.
    NIAID researchers have proposed the idea of a vaccine for the 
treatment of MS and other autoimmune diseases. They have discovered 
that some of the cells involved in the immune response (called T cells) 
attack the brain in people with MS. Drugs that suppress the immune 
system are being given to some patients in an attempt to suppress the 
activated T cells. The next step would be to develop a more specific 
treatment that can attack the activated T cells without affecting 
healthy cells. This targeted approach may serve as a model for treating 
other autoimmune diseases such as juvenile diabetes and lupus.
    The NIAID is also undertaking an initiative on gender-based 
differences in autoimmune diseases. There will be collaboration with 
NINDS and other relevant Institutes including the Human Genome 
Institute. Understanding the gender-based differences in the disease 
process will lead to new understanding of the role of hormones, stress 
and/or genes in the beginning of the disease and its progression. 
Increasing this area of research could indeed be helpful in answering 
the question of why two times more women than men have MS, and what 
science can do about this. Another fruitful area is the study of 
genetic susceptibility to MS and related complex neuro-immunological 
disorders. The NIAID has already made good progress in this area so 
further resources are needed to build on this success.
    These and other research grants are certainly exciting and need to 
be extended. Thus we also urge you to increase by 15 percent the $1.350 
billion research budget of NIAID so that basic and clinical immunology 
and autoimmunity research can continue and advance.
National Center for Medical Rehabilitation Research
    The relatively new National Center for Medical Rehabilitation 
Research, has great potential for those living with MS. Each of the 
research projects studies ways to increase the independence of persons 
living with disability through preserving function and creating 
compensatory technology. Many suggested research projects, so far, have 
gone unfunded. The following are just two of the areas for which 
investment now could yield significant results: > developing new 
assistive devices; < developing coping skills creating alternative ways 
to achieve parenting and job skills using technology.
NIH as a Whole
    We are members of the Ad Hoc Group for Medical Research Funding and 
concur with their budget proposal for NIH. For 1999, the Ad Hoc Group 
supports a 15 percent increase in NIH funding across Institute lines as 
the first step toward the goal of doubling the NIH budget in five 
years. Along with others in the voluntary health organization community 
we recognize the difficulty of achieving the goal of a 15 percent 
increase to 15.64 billion under the current spending caps. A national 
commitment to double the NIH budget over the next five years will 
necessitate that the Congress identify additional resources. We would 
urge the Budget Committees to explore all options carefully including 
adjusting the spending caps, increasing revenues from a tobacco 
settlement and/or tax, and investing part of the surplus.
                      ii. department of education
Rehabilitation Services Administration
    The U.S. Department of Education, Rehabilitation Services 
Administration provided funding to the National MS Society for a 3-year 
demonstration project designed to help maximize job retention and 
enhance job satisfaction for persons with disabling chronic illnesses 
such as multiple sclerosis. The model that has been implemented 
involves meeting directly with employers and their employees with a 
chronic illness who are experiencing difficulties at work. It examined 
job performance barriers and offered recommendations on how to provide 
reasonable accommodations. Through the Project Alliance intervention, 
it is estimated that more than 80 percent of those in the program have 
retained their current position.
    Project Alliance is complete and now as part of an ongoing 
commitment to employment for people with disabilities, we ask you to 
encourage RSA to fund a job retention pilot program for people with 
chronic illness especially those with a relapsing-remitting condition.
National Institute of Disability and Rehabilitation Research
    The National Institute of Disability and Rehabilitation Research 
(NIDRR) has two separate areas of funding requirements, its basic 
research program and the Technology Related Assistance Program for 
People with Disabilities (Tech Act). Included in high potential basic 
research areas are: a longitudinal survey of the impact of managed care 
on individuals in various disability groups; and evaluation of the 
effects of the Americans with Disabilities Act on the daily lives of 
those living with mobility disabilities.
    The Society applauds the decision of the NIDRR to initiate a new 
MS-focused center. With proper funding the MS Research and 
Rehabilitation Training Center should be able to answer crucial 
research questions concerning the effectiveness of rehabilitative 
services for MS patients. The Society is already commenting to the 
NIDRR on the priorities for such a center. We look forward to 
translating the results of this research through our new clinical 
services programs department.
    It is urgent that you consider the cost of our proposed investment 
in biomedical research based on future benefits and savings both to the 
individual and society. This is true in both biomedical and 
rehabilitation research. Funding programs of early intervention to keep 
people working prevents early eligibility for Social Security 
Disability Insurance and the slow dissolution of an individual's funds 
leading to Medicaid coverage and the need for income supports. The fact 
that $11 can be saved for every dollar ($1) spent on rehabilitation 
testifies to its cost-effectiveness. Findings of a long-term health 
survey published recently by Dr. Kenneth G. Manton of the Center for 
Demographic Studies at Duke University clearly showed that medical 
research reduces and delays chronic illness and disability and 
contributes substantial savings in Medicare.
    In summary, we suggest that the only way to control health care 
costs, the only way to make sure that young adults with MS remain 
independent, productive, tax-paying citizens is to increase support for 
government funded biomedical and rehabilitation research. Many experts 
now foresee MS as a family of largely controllable diseases with 
preventable disability but only if research continues at a rapid pace. 
We ask that you consider a 15 percent increase for fiscal year 1999 for 
NIH and a 7 percent increase for the rehabilitation research programs 
at the Department of Education. Thank you for allowing me to submit 
this testimony.
                                 ______
                                 
Prepared Statement of Joe L. Mauderly, Senior Scientist and Director of 
       External Affairs, Lovelace Respiratory Research Institute
    It is proposed that the Department of Health and Human Services 
(HHS), through its constituent agencies, participate in an interagency 
effort to establish and maintain the National Environmental Respiratory 
Center to facilitate a national initiative to understand the 
respiratory health risks of combined exposures to mixtures of airborne 
contaminants in the outdoor, home, and workplace environments.
the nation faces a dilemma concerning the respiratory health effects of 
     environmental and occupational exposures to airborne toxicants
The U.S. has a large burden of respiratory disease
    Respiratory diseases now kill one out of four Americans.--Among 
cancers, which are the second leading cause of death, lung cancer is 
the single largest killer. Nearly 200 thousand new cases of respiratory 
tract cancer are expected this year, and 170 thousand Americans will 
die from these cancers. Lung cancer kills more than twice as many women 
as breast cancer, and more than twice as many men as prostate cancer. 
Excluding cancer, chronic respiratory diseases and pneumonia are the 
third leading cause of death in the U.S., killing over 188 thousand 
Americans in 1995. Pneumonia and heart-lung failure are the terminal 
conditions for many of our elderly and together, pneumonia and 
influenza are the sixth leading cause of death. Asthma, growing 
unaccountably in recent decades, now afflicts 15 million Americans, 
including 5 million children. The incidence of asthma increased 61 
percent between 1982 and 1994. Asthma is the leading chronic disease of 
children, and asthma deaths among children nearly doubled between 1980 
and 1993. Chronic obstructive lung disease afflicts nearly 16 million 
Americans and causes 1 million hospitalizations annually. Allergic 
rhinitis (hay fever) afflicts 39 million Americans, 50 percent of whom 
are children. Viral respiratory infections are the most common cause of 
hospitalization of infants and cause a tremendous loss of productivity 
in the adult workforce.
    Despite workplace standards, occupational exposures are still 
associated with numerous respiratory diseases, including allergic 
sensitization, rhinitis and bronchitis, pneumoconiosis, and cancer. 
Indeed, occupational lung disease is the number one work-related 
illness in the U.S. in terms of frequency, severity, and degree of 
``preventability''. NIOSH estimates that as much as 30 percent of 
chronic obstructive lung disease and asthma in adults may be caused by 
occupational exposures, and that 20 million workers are exposed to 
agents that can cause these diseases. The national health burden for 
occupational asthma is estimated to be as high as $400 million yearly.
The relationship between inhaled pollutants and respiratory disease is 
        not well understood
    The extent and nature of the association between environmental air 
pollution and respiratory disease are only partially understood. Air 
pollution is known to aggravate asthma, emphysema, bronchitis, 
infections and other respiratory illnesses. For example, particulate 
matter (PM) is statistically associated with death in elderly persons 
with heart and lung diseases, and this mortality is thought to occur 
largely from aggravation of their preexisting diseases. It is 
plausible, but much less certain, that air pollution might play a role 
in causing some diseases. For example, secondhand tobacco smoke is 
suspected of playing a role in conversion of the respiratory immune 
responses of children from normal Th1 to allergic Th2 responses. 
Seemingly to the contrary, the incidence of asthma is increasing while 
levels of most measured pollutants in the U.S. are decreasing. The 
reason for this is unknown, but speculations include vehicle traffic-
related increases in ultrafine particles, which may be increasing but 
contribute too little mass to be detected by present air quality 
measurements. It is often easier to establish a link between 
occupational exposures and respiratory disease, but the impacts of many 
occupational exposures are still unclear. While it is known that 
occupational exposures to airborne dusts, chemicals, and allergens are 
linked to respiratory disease, it is often difficult to determine the 
relative contributory roles of the occupational exposures vs. exposures 
in the home and general environment and personal factors such as 
smoking. Tobacco smoke remains the most important confounding factor in 
determining the effects of both environmental and occupational 
exposures.
uncertainty about the health effects of pollutant mixtures or combined 
    exposures to multiple agents is an especially important problem
Little is known about the health effects of combined or sequential 
        exposures to multiple toxicants
    Agencies, researchers, congress and the public are becoming 
increasingly aware that addressing the health consequences of air 
pollution one pollutant at a time is approaching a point of diminishing 
returns. Paradoxically, as levels of regulated pollutants and workplace 
contaminants fall due to existing controls, and the most obvious health 
effects are reduced, the uncertainty faced in estimating the remaining 
health effects of airborne agents becomes larger. Air contaminants 
always occur as mixtures; nobody ever breathed only one pollutant at a 
time! It is increasingly clear that we must improve our ability to 
understand and control health risks from mixtures of toxic agents, 
typically at low concentration, and from combinations of sequential 
exposures to toxicants, at different times and in different locations. 
The effects of involuntary exposures to environmental air pollutants 
are be difficult to distinguish from the effects of home and workplace 
exposures, the effects voluntary activities such as smoking, cooking, 
use of household and personal aerosols and volatile materials, and 
other activities involving exposures to inhaled materials.
    It is difficult to link health effects to specific pollutant 
classes, and even more so to individual pollutants. We know that 
multiple pollutants can cause the same effects (eg, inflammation, 
cancer). We also know that some pollutants can amplify the effects of 
others (eg, acid particles and ozone, radon and cigarette smoking). We 
do not know, but can presume likely, that a mixture of pollutants, each 
within its individually acceptable concentration, could present an 
unexpected aggregate health risk that is unacceptable. Moreover, our 
growing understanding of atmospheric chemistry is revealing an 
increasing number of reaction products for which there is little or no 
health information. Our poor understanding of the toxicity of toxicant 
mixtures makes it difficult to identify and prioritize the sources or 
practices whose management would most efficiently reduce the effects, 
and to compare the potential health gains to the financial, 
technological, and lifestyle commitments required to achieve them.
we have neither the regulatory nor the scientific ability to deal with 
                           combined exposures
    Present environmental and workplace air quality regulations address 
individual pollutants, or pollutant classes, one at a time. The present 
approach to implementing the National Ambient Air Quality Standards 
under the Clean Air Act addresses the levels of six individual 
pollutants (eg, carbon monoxide), or pollutant classes (eg, particulate 
matter), individually. In contrast, the nearly 200 Hazardous Air 
Pollutants regulated under the Act are addressed by controlling the 
aggregate emissions of any or all of the compounds on a source by 
source basis with little consideration of the ambient levels or the 
individual or combined health effects of the compounds. For 
occupational exposures, OSHA sets Permissible Exposure Limits (PELs) 
and NIOSH sets Recommended Exposure Limits (RELs) for dozens of 
individual compounds and a few classes of agents such as petroleum 
distillates, welding fumes, wood dust, etc. Neither the environmental 
nor the occupational air quality or exposure regulations address the 
potential interactions among the individual agents, or the need for 
special limits for individuals with other risk factors. Under this 
regulatory strategy, a simultaneous exposure at the maximum allowable 
levels to all environmental and occupational air contaminants combined 
would theoretically be regarded as having no greater risk than exposure 
to only one of the agents at its regulated level!
    Regulatory approaches and their legislative foundations are not the 
key problem; they can be changed. The overriding issue is our lack of 
knowledge about the health risks of pollutant mixtures, and the lack of 
ongoing research and research paradigms that will provide a basis for 
such changes. Although several laboratory studies with two or three-
component mixtures of inhaled toxicants have been done, only a 
miniscule portion of the nation's research effort has focused in this 
area. Similarly, epidemiology has undervalued the combined exposures 
issue. Co-pollutants are most often viewed by epidemiologists as 
confounders to be minimized so that the effects of the one pollutant of 
interest can be isolated at its highest level of statistical 
significance, which may be just the opposite of the approach needed to 
understand the greater truth about the effects of the pollutant 
combinations and interactions. The research strategies that presently 
exist for addressing combined effects and interactions are limited, and 
creative thinking is needed to develop new approaches. Researchers have 
largely limited their thinking to testing simple combinations for 
effects that are more or less than additive; however, the myriad 
possible combinations cannot all be tested this way. Another common 
approach is to test the components of complex mixtures to determine 
their individual contributions to a single effect. The relevance of 
this approach depends on correctly identifying the effect and 
understanding its mechanisms. Both these and new approaches are needed.
 the national environmental respiratory center is a new initiative to 
    improve our understanding of the respiratory health effects of 
               pollutant mixtures and combined exposures
The center is intended to be a long-range, interagency, 
        interdisciplinary initiative
    The Center is being initiated this year with core funding provided 
for in the EPA fiscal year 1998 appropriations. The scope of the needed 
effort extends beyond the conduct of individual studies, or even a 
``program project'' of research as might be funded through typical 
granting mechanisms. Identifying the bounds of the problem, 
benchmarking current thinking, and identifying the best paths forward 
will require the organized input of health specialists, atmospheric 
scientists, epidemiologists, risk assessors, and regulatory 
strategists. A central source of information specific to the health 
effects of pollutant mixtures and reaction products, research underway, 
and specialized research resources is needed. Researchers across the 
country need access to specialized facilities, but these need not be 
duplicated in multiple locations. Intellectual input and financial 
support needs to be sought from a broad range of Federal and non-
Federal sources. It is appropriate for this long-term and challenging 
activity to be undertaken by an independent organization with high 
credibility, experience in the combined exposures field, and a strong 
commitment to success.
    It is important that multiple agencies support the work and 
objectives of the Center. No single agency has the sole mandate for 
addressing the combined exposures problem, although EPA is readily 
identified as the agency with lead responsibility regarding management 
of environmental exposures. The Department of Health and Human 
Services, through NIEHS and NIOSH, and to a lesser extent through 
NHLBI, and its other constituent organizations, certainly has a stake 
in the health effects of mixed exposures, as do the Departments of 
Energy, Defense, Labor (OSHA), and Commerce (NOAA). Existing 
interagency committees and other Federal and government-industry 
working groups, such as the Committee on Environmental and Natural 
Resources Research (CENR) and the North American Research Strategy for 
Tropospheric Ozone (NARSTO) touch on these issues, but none has taken 
up the challenge of assuming the lead role of focusing attention, 
facilitating communication, and conducting research on the problem.
Lovelace is experienced in combined exposures research, and committed 
        to meeting the challenge
    The Lovelace Respiratory Research Institute is an independent, 
nonprofit organization totally dedicated to respiratory health 
research. It is also among the nation's few organizations having 
substantial experience in evaluating the health effects of mixtures of 
inhaled toxicants and combined or sequential exposures. It has strong 
expertise in the generation of complex atmospheres, inhalation 
exposure, respiratory dosimetry, measurement of health responses and 
determining their mechanisms, and the use of radiotracers to track 
compounds through the body. Lovelace has researched health risks from 
complex chemical mixtures involved in fossil fuel technologies, diesel 
exhaust, and combined radiation, chemical, and cigarette smoke 
exposures of workers. Work for a broad range of Federal and non-Federal 
sponsors has focused on the mechanisms of respiratory disease, health 
risks from complex mixtures and their constituents, interspecies 
similarities and differences, susceptibility from pre-existing 
respiratory disease, and the utility of animal responses for predicting 
human health risks. As one example, Lovelace recently developed the 
first successful rodent model of cigarette smoke-induced lung cancer 
and demonstrated that smoking markedly increased the cancer risk from 
irradiation of the lung. Based on its past research, current 
involvement in national occupational and environmental health issues, 
and focus on reducing respiratory disease, Lovelace has a strong 
commitment to the success of this new venture.
    Lovelace operates the taxpayer-owned, recently privatized, 
Inhalation Toxicology Research Institute facility, an ideal physical 
location of the Center. It has several specialized facilities that can 
serve the scientific community as user facilities, such as laboratories 
for working with engine exhaust, tobacco smoke, and other complex 
mixtures. The facility has the nation's broadest capability for 
capability for exposing cells, tissues, and all species of laboratory 
animals to airborne materials and evaluating responses from the 
molecular to the clinical levels.
            The Center Will Meet Specific Needs to Facilitate a Broader 
                    National Effort
    The Mission of the Center is to catalyze, facilitate, and 
participate in a long-range national initiative to understand 
respiratory health risks from combinations of inhaled airborne 
environmental and occupational pollutants. The Center's goal is to help 
place the respiratory health risks from variable, mixed pollutant 
atmospheres in their appropriate context as a basis for regulatory and 
technological decision making. It is the role of the Center to 
facilitate this initiative by complementing the efforts of other 
interagency and government-industry groups to raise and maintain the 
visibility of the issue and make progress in its resolution.
    The Center will perform the following functions:
    Conduct Research.--The Center will conduct intramural and 
collaborative research relevant to understanding the respiratory health 
risks of combined exposures to airborne toxicants, and the exposure-
response, mechanisms, susceptibility, and interspecies extrapolation 
issues important to advancing our understanding of respiratory disease 
and the control of health risks. The advice of a scientific advisory 
committee and other external scientific peer review will be used in 
guiding the Center's research program. This effort will be expanded by 
complementary research funded through collaborations with external 
scientists making use of the Center's specialized facilities.
    Provide Information.--The Center will develop, maintain, and make 
broadly available information related to combined exposures issues. 
Researchers, agencies, congress, industry, students, and the public 
will access listings of published research, ongoing research, relevant 
scientific and regulatory issues, and research resources by phone, fax, 
e-mail, and the internet. The Center will develop and keep current 
information specific to combined exposures issues that is not currently 
maintained in organized form by other organizations. It will also 
provide links to the many related data bases on air contaminants and 
health that are maintained by other organizations.
    Facilitate Communication and Planning.--The Center will coordinate 
workshops and conferences on the health effects of pollutant mixtures 
and combined exposures. Current knowledge will be benchmarked. 
Particular emphasis will be given to establishing a continuing 
communication loop between health scientists and atmospheric scientists 
to focus the efforts of both research communities on the exposures and 
effects thought to be the most important. Multiple government and non-
government research sponsors and researchers from numerous 
organizations and disciplines will be brought together to identify 
critical research gaps and optimize the use of resources. This effort 
will complement other interagency and government-industry coordination 
activities.
    Provide Research Facilities.--The Center will develop and maintain 
certain specialized facilities needed for research on mixtures, 
reaction products, and combined exposures. It will make the facilities 
operated by Lovelace available for use by researchers in other 
organizations, collaborating and providing assistance as appropriate. 
It will also assist researchers in identifying and accessing 
specialized resources and collaborators in other organizations.
HHS Should Participate in the National Environmental Respiratory Center
    Initial funding for the Center was provided in the amount of $2 
million in the fiscal year 1998 EPA appropriation. The Center can only 
be successful as a long-term initiative, with a broad base of support 
that includes key Federal agencies. Lovelace seeks support from HHS to 
expand the combined exposures research program beyond the small scope 
possible with the core funding from EPA, and is also seeking funding 
from other agencies. Lovelace is also seeking funding from non-Federal 
entities such as individual companies and trade associations for both 
undesignated support for the Center and specific research projects 
related to the Center's mission.
    HHS and its constituent agencies are clearly stakeholders in 
combined exposure issues. For example, Environmental health is central 
to the mission of NIEHS and NHLBI has interest in the role of combined 
exposures in the mechanisms of lung disease. NCI has expressed interest 
in pursuing the mechanisms by which combined exposures might act 
synergistically to cause cancer. Lovelace's recent development of an 
animal model useful for evaluating the interactions between cigarette 
smoking and occupational exposure is especially relevant to the mission 
of NIOSH. That agency's most recent strategic plan specifically 
recognizes the importance of combined occupational exposures and 
interactions among toxic agents. That plan calls for new approaches to 
identify synergistic effects of multiple exposures, to improve 
laboratory and statistical analysis methods and to develop hazard 
controls that take into account the components of the mixture. Support 
of the Center through NIOSH would ensure that the national initiative 
in the area of combined exposures includes occupational concerns and is 
not limited to agents of concern only in the general environment.
                                 ______
                                 
  Prepared Statement of Gerald G. Krueger, M.D., American Academy of 
                              Dermatology
    Mr. Chairman and members of the Subcommittee, my name is Gerald G. 
Krueger, M.D. I am a Professor of Dermatology at the University of Utah 
School of Medicine. I am also the chairman of the American Academy of 
Dermatology's Research Council. I am currently the principal 
investigator of a grant from the NICHD, and serve as co-investigator of 
two grants funded by the NIDA. My curriculum vitae has been enclosed 
for your information.
    My colleagues and our patients thank you, Chairman Specter, and 
members of the Subcommittee for your continued support for the National 
Institutes of Health (NIH) and the Centers for Disease Control and 
Prevention (CDC). The Academy acknowledges the very difficult choices 
that this Subcommittee has made over the last few years. We are 
grateful that biomedical research enjoys bipartisan support in this 
Subcommittee and in the Congress.
    Our Nation's biomedical research infrastructure is an intricate 
relationship of academia, industry, and the federal government. The NIH 
serves as the primary source for basic research through universities 
and independent research institutions. This synergy has alleviated 
suffering for millions of Americans by fostering the development of 
innovative drugs and vaccines. Biomedical research is also the 
foundation upon which all medical care is based. Without the NIH, we 
would not be the world leader in research and patient care.
    Dermatologists are trained to treat over 3,000 disorders of the 
skin, hair, nails, and mucous membranes. Support for the NIH, most 
especially NIAMS, has broadened our knowledge of common as well as rare 
skin diseases.
    The American Academy of Dermatology joins with our professional and 
patient advocate colleagues to support a funding increase of 15 percent 
for the NIH in fiscal year 1999. In addition, the Academy also requests 
an increase for the Centers for Disease Control and Prevention's Skin 
Cancer Prevention Program. This program is currently funded at a level 
of $1.8 million. We request that funding for this program be increased 
to $5 million in fiscal year 1999.
    Skin cancer is the most frequent cancer diagnosis, more than all 
other cancers combined. This year, over 1 million new cases of skin 
cancer will be diagnosed in the United States. Nearly 80 percent of the 
new cases will be nonmelanoma skin cancers, namely basal cell or 
squamous cell carcinomas. Although both basal cell and squamous cell 
carcinomas have a cure rate of 95 percent if detected and treated 
early; 1,200 Americans, like Congressman Steve Schiff, will die of 
these nonmelanoma skin cancers.
    A recent ``report card'' issued by the National Cancer Institute 
(NCI), the American Cancer Society, and the CDC concluded that we have 
made great strides in reducing cancer incidence and mortality. The 
report stated that cancer incidence and mortality had declined, in some 
cases significantly, for nearly all forms of cancer. However, the 
report noted two deadly cancers that are on the rise--non-Hodgkin's 
Lymphoma and melanoma.
    Melanoma is the most deadly form of skin cancer. It is estimated 
that 41,600 new cases of melanoma will be diagnosed this year, an 
increase of 3 percent over last year's levels. This year, 7,300 
Americans will die from melanoma, accounting for six out of every seven 
skin cancer deaths. While the death rate from melanoma continues to be 
highest for older white males, melanoma strikes across the age spectrum 
and is now the most common cancer among people between the ages of 25 
and 29.
    Skin cancer is preventable. A determined public health effort of 
prevention, education, early detection, and basic biomedical research 
into the mechanisms of skin cancer will reduce the incidence and 
mortality of skin cancer. The Academy believes that this important skin 
cancer prevention program should receive additional resources to 
enhance the multi-faceted activities of the National Skin Cancer 
Prevention Program. If funding levels were to be increased from the 
current level of $1.8 million to $5 million in fiscal year 1999, the 
funds would be well spent. These additional dollars would allow the CDC 
to expand the Skin Cancer Prevention Education Program to additional 
states and territories, to coordinate and implement skin cancer 
prevention programs, to supplement its on-going Youth Risk Behavior 
Survey, support behavioral research, and strengthen professional 
education.
    Skin cancer can also be effectively treated, if found early. I 
invite all the members of the Subcommittee to participate in an 
upcoming annual skin cancer screening of Congress. Members of the 
Washington, D.C. Dermatological Society will conduct a free skin cancer 
screening on May 13, 1998, between 9:30 am and noon in the Rayburn 
First Aid Station, Room B344.
    Biomedical research is beginning to provide answers to our 
questions about skin cancers. Last year, researchers supported by the 
National Institute of Musculoskeletal and Skin Diseases (NIAMS) and the 
NCI significantly advanced our understanding of skin cancer. Scientists 
identified the gene that is the cause of a rare inherited disorder, 
basal nevus syndrome, and acquired basal cell carcinoma. Researchers 
believe that their findings may eventually lead to innovative 
treatments for basal cell carcinomas. We are also hopeful that NCI-
supported scientists will be successful in their efforts to develop a 
melanoma vaccine.
    The research supported by the NIH is crucial to our fight against 
other chronic, debilitating and sometimes fatal skin diseases. Skin 
diseases are an important health concern for this country, as they are 
the most common cause of chronic illness in the United States. This 
year, it is estimated that 60 million Americans will be affected by 
skin disease, costing our economy over $7 billion in treatment costs 
and lost productivity. Occupational skin diseases remain one of the 
most common causes of workers' compensation claims.
    Psoriasis is a common skin disorder, affecting six million people 
in the United States. Previously, scientists believed psoriasis to be 
primarily a disorder of the keratinocytes, the most common cell in the 
outer layer of the skin. Recent investigations have greatly altered our 
understanding of psoriasis. Researchers now view psoriasis as an 
immunologic disorder, and this observation has led to new treatments 
for psoriasis. A tissue bank established by the National Psoriasis 
Foundation and supported by the NIAMS is helping scientists make 
progress in identifying the genes linked to this disease.
    Eczema is a term often used to describe a family of conditions that 
include: atopic, contact, occupational seborrheic, and stasis 
dermatitis. Millions of Americans suffer from some form of eczema. 
While bench-to-bedside research pays dividends, there is much we do not 
know about how to prevent and best treat eczema. There is considerable 
interest around the world in identifying the numerous elements that 
trigger eczema and protecting patients from them.
    Alopecia areata is a disease that causes hair loss on the scalp and 
elsewhere on the body. In its most severe form, alopecia universalis, 
all hair on the entire head and body are lost, leaving the skin 
unprotected from the sun and other environmental hazards. The nose and 
sinuses are also unprotected from foreign particles and bacteria. 
Children are the most often affected by this disorder. While alopecia 
areata is not life threatening, it is emotionally and psychologically 
devastating to these young children. In a recent issue of Science 
magazine, there was an article describing the discovery of the 
``hairless'' gene, the gene for alopecia universalis. While this 
discovery is very exciting, the discovery of the ``hairless gene'' does 
not unlock the secret of alopecia areata, and additional research is 
needed if we hope to develop more effective treatments or a cure.
    Systemic lupus erythematosus (lupus of SLE) is a disease that 
disproportionately affects young African-American women, and a disease 
of great interest to members of this Subcommittee. Research has 
significantly broadened our knowledge of the genetic factors involved 
in lupus, including those infectious agents and other environmental 
factors that trigger this disease in susceptible individuals. Research 
has also helped us to develop special prevention and education programs 
in lupus. These programs have allowed us to screen many young African-
American women for this disease. The severity of the disease will be 
drastically reduced, if we can identify and treat the disease at its 
earliest stages.
    Scleroderma is another serious disease that predominantly strikes 
women of childbearing years. Scleroderma is a chronic, auto-immune 
disease of the connective tissue. Scleroderma patients overproduce the 
protein, collagen. Its cause or causes are unknown. The treatment 
program for these patients varies widely, depending on the severity of 
the symptoms. Patients with this disease may have thickening of the 
skin, especially around the joints; Raynaud's Phenomenon, an abnormal 
sensitivity to cold; gastrointestinal, renal, cardiac, dental, and 
pulmonary problems. The NIAMS supports both basic and clinical research 
on scleroderma. Recently, NIAMS added scleroderma to the list of 
diseases eligible for applications under the Specialized Centers of 
Research (SCOR) program.
    Vulvodynia is a spectrum of chronic vulvar pain disorders. Today, 
no one knows what causes vulvodynia. Some cases of this disorder may be 
attributed to compression or disease of the pudendal nerve, others to 
Human Papilloma Virus (HPV), chronic candida infection and reactions to 
the anti-fungal treatments for candidiasis, but there is not clear 
agreement. There is also no specific test for vulvodynia and the 
diagnosis is often after ruling out other illnesses or infections. 
Unfortunately, there are no cures for this disorder, and few effective 
treatments for its symptoms. Additional research is desperately needed 
to answer the numerous questions concerning this disorder.
    Sjogren's Syndrome is a third auto-immune disease that 
predominantly strikes women. The clinical manifestations of Sjogren's 
Syndrome are the result of decreased exocrine gland function throughout 
the body. Patients suffer a profound reduction in their quality of 
life, as the disease causes great discomfort in all areas of the body. 
In addition, Sjogren's Syndrome is associated with a number of life-
threatening complications, including renal disorders and vascular 
complications. Currently, there is no known cure for Sjogren's Syndrome 
and the treatments available are aimed only at relieving the many 
symptoms of this syndrome.
    Dermatitis herpetiformis, also known as gluten sensitive 
enteropathy, is an intensely itchy, chronic disorder that may start at 
any age, including childhood. Most patients who suffer from this 
disease have an associated sensitivity to gluten--a protein found in 
wheat, oats, barley, rye, and other grains. Dermatitis herpetiformis 
may often be confused with many other conditions, and patients may be 
misdiagnosed before being effectively treated. Like Sjogren's Syndrome, 
individuals with dermatitis herpetiformis have a marked increase in the 
incidence of certain histocompatibility antigens and it is not uncommon 
that these two disorders are occasionally seen in the same patient.
    The Ichthyoses are a family of skin diseases in which there is 
abnormal development of the outermost layers of the skin. Researchers 
have discovered that the genes for many of the molecules involved with 
the structure of our skin are clustered on chromosome 1, in an area 
called the epidermal differentiation complex. Recent findings have 
linked several forms of ichthyosis, including a form that causes self-
amputation, to mutations of a region of chromosome 1--the first time 
that disease was clearly linked to the epidermal differentiation 
complex.
    Epidermolysis bullosa (EB) is another rare skin disease that has 
provided us with a great deal of information about skin. EB is 
characterized by extreme fragility of the skin. In EB, the slightest 
touch causes blistering, in many cases its symptoms resemble severe 
burns. EB can lead to severe loss of mobility, disability and even 
death. Researchers have identified specific genetic defects that cause 
several forms of EB. The establishment of an EB registry has allowed 
scientists to collect medical information and tissue and blood samples 
from EB patients, greatly facilitating efforts to identify the genetic 
causes of EB.
    Pemphigus, like EB, is a blistering skin disease. In pemphigus, 
patients produce autoantibodies that attach the demosomal proteins that 
hold the skin together. The basic molecular mechanism for this 
blistering disease has been uncovered by research funded through the 
NIAMS. Future research in this disease is needed to learn how and why 
the body produces these autoantibodies as well as to determine the 
relative role of environmental factors--such as viruses, bacteria, 
allergens and toxins--to this disease.
    Ehlers-Danlos Syndrome is another group of rare inherited disorders 
that affects the skin as well as the joints and other organs. Patients 
with Ehlers-Danlos Syndrome have a defect within their collagen. This 
defect leads to extremely fragile skin that bruises and tears easily, 
joints that are hypermobile, and bruising and bleeding tendencies. The 
NIAMS has been the lead institute in research efforts to understand the 
mechanism of wound healing and this effort must continue to be 
supported.
    Marfan Syndrome is a heritable disorder of the connective tissue, 
caused by a single abnormal or mutant gene. In addition to the skin, 
patients with Marfan Syndrome suffer from abnormalities in three areas: 
the eye, the skeletal system and the cardiovascular system. The 
severity of this syndrome varies greatly; and as there are no objective 
tests for diagnostic confirmation, diagnosis can be difficult. There is 
still no cure for Marfan Syndrome, although a variety of treatments 
have been used with some success.
    Ectodermal Dysplasia (ED) is not a single disease, but a group of 
closely related disorders. More than 130 types of ED have been 
identified. Individuals with ED have absent or poorly functioning sweat 
glands; abnormal hair and hair follicles, and the natural hair and skin 
oils may be missing. Patients with ED are prone to rashes and are slow 
to heal when they are bruised or cut. Many are photosensitive, but the 
most common trait is the absence of teeth. Although many types of this 
disease have been identified and documented, there is a great deal that 
we do not know about these disorders. Additional research is needed to 
improve the care and management of these patients.
    Pseudoxanthoma elasticum (PXE) is a heterogeneous inherited 
disorder, the hallmark of which is the dystrophic calcification of the 
elastic tissue of the skin, the eyes and the arteries. Because the skin 
manifestations of this disease are so prominent, the dermatologist is 
often the specialist who makes initial diagnosis and who can coordinate 
the care of the PXE patient with the ophthalmologist, cardiologist, 
vascular surgeon, plastic surgeon, and other health professionals. PXE 
may be inherited as either an autosomal recessive or dominant trait, 
but environmental influences may modify the clinical expression of this 
disease. This year, the locus for the PXE gene was isolated. This small 
step points us toward a cure for PXE.
    Sturge-Weber Syndrome is characterized by an extensive vascular 
nevi or port wine stain at birth, involving the upper eyelid and 
forehead. In Sturge-Weber, the port wine stain is associated with 
various neurological abnormalities as well as irregularities in the 
eyes and internal organs. Children with Sturge-Weber begin to have 
seizures at one year of age. These convulsions are caused by an 
excessive growth of blood vessels on the brain, and often appear on the 
opposite side of the body from the port wine stain. The cause of this 
syndrome is unknown and more research is needed. Recent research has 
helped us to understand that port wine stains develop within the first 
2 to 8 weeks of gestation. Additional research is needed for us to 
better understand the role that angiogenesis may play in these stains.
    Porphyrias are a group of seven rare and complex disorders. The 
porphyrias are characterized by a mutation in genes that code for 
various enzymes of the heme biosynthetic pathway; and each porphyrias 
is biochemically unique. What causes these genes to mutate is still 
unknown. These diseases are often manifest in a variety of cutaneous 
lesions and patients are also very sensitive to sunlight and to many 
drugs. There is no cure for porphyria and treatment varies depending on 
the type. Additional research is needed to better understand what 
causes the genes to mutate. Better understanding of this process could 
eventually lead to the development of new and better treatments.
    Vitiligo is a disease in which patients develop white spots in the 
skin that vary in size and location. These ``spots'' develop when the 
pigmented cells of the skin, melanocytes, are destroyed and melanin can 
no longer be produced. It is estimated that 1-2 percent of the 
population suffer from vitiligo, and in earlier times, these 
individuals were often associated with lepers. Although more noticeable 
in darker complected individuals, vitiligo strikes all races equally. 
More research is needed to understand why the body destroys these cells 
and to understand the relationship of this skin condition to its many 
complications, including Graves' Disease and other diseases of the 
thyroid, deafness and blindness.
    The Academy also supports adequate funding for other institutes at 
the NIH, as skin disease research is supported throughout the NIH. The 
most important institute to skin researchers is the NIAMS; however, 
adequate funding levels for several other institutes is especially 
important to skin disease research.
    The National Institute for Allergy and Infectious Diseases (NIAID) 
funds important research on AIDS, sexually transmitted disease (STD), 
and other infectious diseases. Dermatologists daily treat the many 
cutaneous manifestations associated with HIV infection. These diseases 
include bacterial infections, viral infections, fungal and yeast 
infections, protozoal infections, hyperkeratotic and neoplastic disease 
of the skin. Dermatologists also treat other STDs, such as genital 
herpes, human papilloma virus, and genital warts. Future research 
opportunities for HIV and other STDs include the development of topical 
microbicides, new and more effective therapies, vaccines and improved 
prevention strategies. In addition, the NIAID also provides funding for 
immunologic skin disease.
    Our skin is our first defense against disease and toxins in the 
environment. The Academy supports increased funding for the National 
Institute of Environmental Health Sciences (NIEHS). Our specialty has 
taken the lead in recognizing environmental hazards to the skin, at 
home and at work. Increased funding for NIEHS will allow this institute 
to expand research on the action spectrum for melanoma, percutaneous 
absorption of toxic and other chemicals and how that absorption may be 
affected by exposure of the skin to ultraviolet radiation.
    Expanding our basic knowledge of the human skin will provide 
insight into other systemic diseases and may provide better treatments. 
The skin is an excellent delivery system for drugs. The development of 
skin patches and other devices allow for sustained release of drugs.
    Mr. Specter and members of the Subcommittee, as I stated earlier, 
biomedical research is the foundation upon which all advance in medical 
treatment are based. I appreciate your attention and the opportunity 
you have given the American Academy of Dermatology today and welcome 
the opportunity to answer any questions.
                                 ______
                                 
    Prepared Statement of the American Association of Dental Schools
    The American Association of Dental Schools (AADS) represents all of 
the dental schools in the United States, as well as advanced dental 
education, hospital dental residency programs, and allied dental 
education institutions. It is within these institutions that future 
practitioners, educators, and researchers are trained; significant 
dental care provided; and the majority of dental research conducted. 
The AADS is the one national organization that speaks exclusively for 
dental education.
    While dentistry has made significant progress in preventing oral 
disease and developing primary care treatments, little more than half 
of all Americans have access to routine dental care. A 1995 Centers For 
Disease Control (CDC) survey revealed that nearly half (44.3 percent) 
of adults report having no dental insurance. Consequently, oral 
diseases are still among the most prevalent and common of all chronic 
health conditions. A 1996 Healthy People 2000 review conducted by the 
CDC reports that in the United States, 94 percent of adults have 
evidence of past or current tooth decay, and only one third of adults 
age 35-44 years have all of their permanent teeth. Periodontal disease 
is also pervasive among adults 18 and over.
    Oral cancer is more common than leukemia, Hodgkin's disease, 
melanoma of the skin, and cancers of the brain, cervix, ovary, liver, 
or stomach. Each year there are approximately 30,000 newly diagnosed 
cases of oral cancer, and 8,000 deaths. Accordingly, poor oral health 
has a tremendous economic impact on our country, causing our nation's 
workforce to miss more than 164 million hours of work annually.
    The NIH reports that half of U.S. children already have cavities by 
age 7, and eighty-four percent of all children have experienced dental 
decay by age 17. Oral conditions left untreated severely impair a 
child's ability to concentrate in school and result in more than 52 
million hours of time away from the classroom annually. If the nation 
is serious about having all children ready to learn by the time they 
enter school, we must improve access to comprehensive health services, 
including adequate oral health care. The importance of oral health will 
also be addressed in a U.S. Surgeon General's report that is currently 
under development for a release date of Spring, 1999.
    Our funding requests for fiscal year 1999 reflect the expanding 
role of dentistry in our nation's health care system and the changing 
nature of the profession. Dental education institutions play an 
important role in providing oral health services in the community, and 
these institutions provide a significant amount of care to underserved 
and uninsured populations. Because the Subcommittee is under severe 
fiscal constraints, we have focused on dental education and research 
programs that are extremely cost-effective and will yield a significant 
return for the federal investment in improving access to primary health 
oral care.
    General Dentistry Residencies.--General Dentistry Residency 
training programs provide dentists with the skills and clinical 
experiences needed to deliver a broad array of oral health services to 
the full community of patients. Dentists who have had the benefit of 
this advanced residency training consistently refer fewer patients to 
specialists, which is especially important in rural and underserved 
urban areas where logistical and financial barriers can make 
specialized care unobtainable.
    The General Dentistry Residency program has been a highly effective 
tool in improving access and availability of primary care services. 
Eighty-seven percent of those who receive General Dentistry Residency 
training remain in primary care practice. Compared to private practice, 
these residents treat 4 times the number of developmentally disabled, 6 
times the number of medically compromised, and 26 times the number of 
HIV/AIDS patients.
    Most current grantees include off-site rotations to underserved 
communities, where general dentistry residents provide oral health 
services to populations, such as the poor, the developmentally 
disabled, the elderly, and patients with infectious diseases. The 
following are a few examples of programs that are current or past 
recipients of General Dentistry Residency Training Grants, enabling 
these institutions to initiate or expand their training programs:
  --Temple University School of Dentistry's General Dentistry Residency 
        training program has a unique partnership with the Philadelphia 
        Parent Child Center, a large Head Start program for 427 
        children in North Philadelphia. General Dentistry residents 
        provide oral health screenings and follow-up services to 3-5 
        year old children enrolled at the Center. The General Dentistry 
        Residency program at Temple also works with the University's 
        ``Outreach Program,'' which conducts health education, health 
        promotion, and oral screenings to populations in the diverse 
        neighborhoods surrounding the University. Many of these 
        patients traditionally do not seek services from a dentist in 
        private practice. Temple University first established its 
        General Dentistry Residency program with four residents in 
        1990, with a HRSA General Dentistry Residency Training grant. A 
        second three-year HRSA grant was awarded in 1992 which enabled 
        the program to expand to six residents.
  --The University of Iowa College of Dentistry received a General 
        Dentistry training grant in 1991 which allowed for expansion of 
        the residency program to include the establishment of an off-
        site clinic at the campus in Oakdale, Iowa, to provide 
        residents with experience in rural practice. The College of 
        Dentistry is currently in the process of developing a state-
        wide network of general dentistry training programs linked with 
        the College and Federally Qualified Health Centers in Iowa. 
        Expansion grant funding under the General Dentistry Residency 
        program will be sought to support the first stage of 
        implementation planned at the Broadlawns Medical Center located 
        in Des Moines, which serves inner city poor and the medically 
        indigent population of Polk County. The second phase of the 
        project will facilitate the opening of three additional general 
        dentistry training program sites in community-based settings.
  --The University of Mississippi School of Dentistry (U.Miss) has 
        successfully competed for two recent three-year General 
        Dentistry grants. The first grant, awarded in 1993, established 
        the General Dentistry Residency program at the School of 
        Dentistry. In 1996, a second three-year grant resulted in the 
        expansion of general dentistry residents from 3 to 5, 
        facilitating the opening of a new dental clinic in a converted 
        shopping mall located in one of Jackson, Mississippi's 
        economically distressed neighborhoods. At the ``Jackson Medical 
        Mall'' where the new dental clinic is located, residents gain 
        experience providing dental care to the physically or 
        psychologically challenged and other special patient 
        populations that have experienced barriers to obtaining oral 
        health services.
  --At the University of Missouri-Kansas City School of Dentistry 
        (UMKC), General Dentistry residents deliver dental care 
        services to underserved populations in two area health clinics. 
        One of the clinics is in a predominantly Hispanic community 
        where most of the patients are Spanish-speaking only. The other 
        clinic serves a large number of indigent, homeless, and HIV/
        AIDS patients. The UMKC general dentistry program was 
        established with a HRSA General Dentistry grant in 1987, with 
        four residents. The program expanded in 1993, from four to 
        eight residents, with a second three-year HRSA grant.
  --At the University of Oklahoma College of Dentistry (OU), residents 
        participating in the General Dentistry Residency program spend 
        two days a week providing oral health services at the ADENT 
        Clinic located at Children's Hospital in Oklahoma City. General 
        Dentistry residents at OU also provide a significant amount of 
        free dental care through the Friendly Smiles Program, in which 
        needy children are identified by the county and referred to the 
        dental school clinic for treatment and preventive oral health 
        care. The General Dentistry Residency program at OU was 
        established with the support from a General Dentistry grant 
        that ended in 1991. Today the program is self-sustaining and 
        provides important clinical training and a valuable public 
        health service to the community. Program evaluations confirm 
        the success of General Dentistry Residency programs in meeting 
        federal primary care objectives. The Bureau of Health 
        Professions' evaluation of this program found that: 
        ``Considering the relatively modest investment of funds by the 
        federal government, the impact on the growth and scope of 
        General Dentistry programs and the subsequent effect on dental 
        care has been substantial.''
    And all of this is achieved with start-up grants which provide 
federal support for no more than three years. This requires 
considerable skill, as General Dentistry Residency programs must 
attract enough self-pay patients and patients with dental insurance to 
offset the losses incurred in treating the indigent. Unlike their 
medical counterparts, dental programs cannot rely on reimbursement 
through Medicare because the program essentially excludes dental 
services, and Medicaid coverage is extremely limited, especially for 
adult care.
    Demand for General Dentistry training continues to outpace supply 
for this primary care training as approximately 300 additional training 
positions are needed to accommodate the number of current applicants. 
Without Federal support, it would be extremely difficult to create new 
programs because of the lead time needed for these programs to become 
self-sufficient, and because of the high cost of start-up funding for 
dental equipment and instrumentation.
    The 1995 Institute of Medicine (IOM) Study of Dental Education 
recommends that postdoctoral education in general dentistry should be 
available for every dental graduate and that an emphasis should be 
placed on creating new General Dentistry Residency positions.\1\ While 
progress has been made in meeting the current and future demand for 
primary care training and care, much work still needs to be done. In 
1997, the first year enrollment for all accredited dental residency 
programs would have accommodated only 63 percent of all U.S. dental 
school graduates. For these reasons, we urge the Subcommittee to 
support an appropriation that will permit continued progress towards 
achieving the workforce training goals set forth by the IOM. The AADS 
is seeking an inflationary increase of $200,000 over fiscal year 1998 
levels for the General Dentistry Residency Training program, resulting 
in an fiscal year 1999 budget of $4 million for this cost-effective and 
proven primary care program.
---------------------------------------------------------------------------
    \1\ Field, Marilyn J., Ph.D., Editor, Dental Education at the 
Crossroads, Challenges and Change, National Academy Press, Washington, 
D.C., 1995, p.14.
---------------------------------------------------------------------------
    The AADS would also like to bring to the attention of the 
Subcommittee legislation developed by the Senate Labor & Human 
Resources Subcommittee on Public Health and Safety, S. 1754, that would 
reauthorize the Title VII and Title VIII Health Professions Education 
and Training programs. S. 1754 would authorize the primary care dental 
program to include both General Dentistry Residency Training and 
Pediatric Dentistry Residency Training support. The AADS fully supports 
this expansion because, as with General Dentistry training; many 
applicants to Pediatric Dentistry training positions are turned away 
due to lack of positions. Pediatric Dentistry training positions have 
not expanded in the last 20 years, despite increased societal needs. 
Pediatric Dentistry is the dental counterpart to general pediatrics. 
While preventive dental care for children is one of the great successes 
in public health, there is still a significant unmet need, and with the 
establishment of the new State Children's Health Insurance Program 
(SCHIP) we expect the need for trained pediatric dentists to increase. 
Because the fiscal year 1998 appropriation provided $3.8 million for 
General Dentistry alone, the addition of Pediatric Dentistry to the 
authorization would require additional funding to ensure that critical 
training needs in both areas are met.
    Ryan White HIV/AIDS Dental Reimbursement Program (Part F, Ryan 
White CARE Act).--Federal support for this program increases access to 
oral health services for people living with HIV/AIDS and at the same 
time, provides dental students and residents the education and training 
necessary to deliver oral health care to HIV/AIDS patients. Thus, two 
major federal objectives--service to patients of limited means and 
education of future practitioners--is accomplished with this important 
but very modest federal program.
    As a result of immune system breakdown that occurs, HIV/AIDS 
patients are more susceptible to oral diseases, such as oral lesions 
that cause significant pain and oral infection leading to fevers, 
weight loss, and difficulty in eating, speaking or taking medication. 
Extreme pain in the mouth is frequently the symptom that motivates 
patients to seek care. In fact, many of the first physical 
manifestations of HIV infection are found in the oral cavity, and a 
dentist is often the first health care professional to diagnose these 
patients. Moreover, the development of some oral problems may signify 
that HIV infection is progressing.
    Oral health care has continued to be a major need of HIV/AIDS 
patients, and consistently ranks high in surveys of health needs of 
HIV/AIDS patients.
    It is important to remember that private insurance and Medicaid 
coverage for dental services is very limited or simply unavailable for 
adults. This lack of sufficient reimbursement particularly affects 
those dental education clinics that serve as the safety net for a 
significant number of Medicaid and HIV/AIDS individuals. The Ryan White 
HIV/AIDS Dental Reimbursement program facilitates treatment of patients 
by alleviating some of the financial burden faced by institutions, 
allowing some dental treatment facilities to stay open despite chronic 
under-reimbursement. This program represents a partnership between the 
federal government and dental education programs, in which the 
government partially offsets the costs dental education programs incur 
by serving a disproportionate share of HIV/AIDS patients. Dental 
education institutions accept this partnership because it helps us to 
continue to deliver and expand care for people living with HIV/AIDS. 
The program has also enhanced relationships of dental education 
institutions with state and local AIDS care programs.
    In 1997, 104 dental education programs provided oral health 
services to approximately 70,000 patients, and collectively incurred 
$15 million in uncompensated costs. The Ryan White HIV/AIDS Dental 
Reimbursement program retrospectively reimbursed these dental treatment 
facilities a total of $7.3 million for services delivered.
    A preliminary evaluation of program participants found that this 
program had a positive impact in the following areas: integrating oral 
health care with other services, increasing the support and commitment 
among providers to HIV/AIDS education and provision of care, increasing 
the providers' knowledge about infection control and treatment, and 
increasing patient access to oral health.
    Early in the epidemic, the majority of patients seeking dental care 
were severely immuno-compromised. Thus, dental intervention was 
directed towards eliminating infection and pain with definitive 
procedures which had the lease likelihood of exacerbating the patient's 
already fragile condition. With the advent of multi-drug therapies, 
many patients are living longer and more stable lives. Therefore, 
dental intervention has increased in scope from palliative care to the 
full range of dental procedures like periodontal procedures, root 
canals, and advanced restorative procedures such as crowns, bridges, 
and partial dentures. Restoring oral health function is of course 
directly related to nutrition, which is so critical for immuno-
compromised patients. We expect unreimbursed oral health costs will 
continue to rise as the number of individuals living with HIV 
increases.
    For these reasons, AADS urges a modest increase of $1.2 million 
over the fiscal year 1998 levels for this important program, resulting 
in an fiscal year 1999 budget of $9 million for the Ryan White HIV/AIDS 
Dental Reimbursement program.
    National Health Service Corps Scholarship and Loan Forgiveness 
Programs.--We strongly support the NHSC Scholarship and Loan 
Forgiveness Programs, which assist students with the rising costs of 
financing their health professions education while promoting primary 
care access to underserved areas. This is particularly significant 
given that the average graduating dental student debt is $82,000.
    Over the last several years, and most recently in fiscal year 1998 
appropriations report language, Congress has instructed the NHSC to 
increase dental participation in the loan repayment and scholarship 
awards programs. The number of dental loan repayment awards has 
increased slowly in recent years, yet we believe that additional loan 
repayments could be awarded. Problems continue to exist in the 
scholarship program, which has completely abandoned dental scholarships 
(the last dental scholarship was issued in 1994). We believe it is 
critical that the NHSC commitment to dentistry be maintained and 
strengthened as the need for dental providers is becoming more 
pronounced in underserved areas throughout the nation. According to a 
Department of Health and Human Services survey, currently 3,032 
dentists are needed to service 957 designated dental Health Professions 
Shortage Areas (HPSAs), as compared to 1,400 dentists needed for 792 
dental HPSAs prior to 1993. Accordingly, the AADS requests the 
Subcommittee to further pursue the need for increased dental 
participation in both the NHSC scholarship and loan repayment programs.
    Health Professions Education and Training Programs for Minority and 
Disadvantaged Students.--We want to express our strong support for the 
various programs that play a critical role in the recruitment and 
retention of disadvantaged students and the recruitment of 
disadvantaged faculty. We request funding increases for the minority 
and disadvantaged assistance programs that are proportional to current 
funding levels within the context of the fiscal year 1999 budget 
request of $306 million for all Title VII and Title VIII Health 
Professions programs recommended by the Health Professions and Nursing 
Education Coalition (HPNEC). The funding levels advanced for the 
following programs as part of HPNEC's fiscal year 1999 budget request 
will maintain our nation's strong commitment to diversity and 
opportunity in the health professions: Scholarships for Disadvantaged 
Students, Exceptional Financial Need Scholarships, Loans for 
Disadvantaged Students, the Centers of Excellence program, the 
Disadvantaged Assistance program (Health Careers Opportunity Program/
Federal Financial Assistance for Disadvantaged Health Professions 
Students), and the Faculty Loan Repayment program.
    Other Programs Under Title VII of the Public Health Service Act.--
We also urge the Subcommittee to fund the following programs at the 
levels advocated by the HPNEC Coalition because of their importance in 
promoting access to healthcare for special populations: Rural Health 
Training and the Health Education and Training Centers programs, 
Geriatric Initiatives, Area Health Education Centers, and Allied Health 
Special Projects.
    Student Loan Programs.--The AADS is concerned about the ability of 
students pursuing a health professions education to access affordable 
federal financial aid due to the phase-out of the Health Education 
Assistance Loan (HEAL) program. We welcomed the Secretary of 
Education's earlier action raising the annual and aggregate 
unsubsidized Stafford Loan limits. However, this action does not meet 
the full need of the health professions community due to the 
limitations accompanying the new policy. Currently, only students 
attending schools which disbursed HEAL loans in fiscal year 1995 are 
eligible. Many dental schools which did not borrow under the HEAL 
program prior to fiscal year 1995 now have students who need to access 
additional loan funds. We believe that using this eligibility time 
frame is arbitrary, and creates a two-tiered system, thus locking out 
many deserving health professions students from the lower cost federal 
student aid program. The AADS is urging the Department of Education to 
broaden the pool of students eligible for the increased annual and 
aggregate Stafford loan limits to accommodate all health professions 
students seeking assistance. We request the Subcommittee's support for 
this effort.
    National Institutes of Health/National Institute for Dental 
Research.--We strongly commend and thank Chairman Specter for his 
leadership in the area of biomedical research, proven by the 
significant increases in the funding levels for the National Institutes 
of Health (NIH) during his Chairmanship. As the National Institute of 
Dental Research (NIDR) celebrates its 50th anniversary, our nation's 
dental education institutions are particularly thankful for the 
continued strong federal commitment in this area of research which over 
the years has opened new pathways to better diagnosis, prevention and 
treatment of oral disease. Support for the NIDR has yielded results 
applicable not only to oral health, but to health in general. NIDR's 
objective is to promote the advancement of research in all sciences 
pertaining to the mouth and facial structures, to seek ways of treating 
and preventing oral diseases, and to facilitate the transfer of 
knowledge into practical help for the public. Scientific areas 
providing great research opportunities on which NIDR will focus in 
coming year include pain research, dental and craniofacial genetics, 
oral and pharyngeal cancer, gene therapy using salivary glands, and 
biomimetics (an interdisciplinary study leading to the replication of 
the process of new cell growth and repair which occurs in living 
organisms). The AADS is particularly pleased that the NIDR plans to 
pursue strategies strengthening its commitment to recruiting and 
retaining young health professionals in the field of biomedical 
clinical research. The recent decline in young men and women entering 
this field threatens our clinical research infrastructure and the 
ability of our nation to fully benefit from increased investments and 
discoveries in the area of biomedical research. The AADS endorses the 
testimony of the American Association for Dental Research regarding 
research priorities and the request for a 15 percent percent increase 
over fiscal year 1998 funding levels, resulting in a budget of $240.8 
million for the NIDR in fiscal year 1999.
    Agency for Health Care Policy Research (AHCPR).--The AADS joins the 
Friends of AHCPR in supporting a budget of $175 million in fiscal year 
1999. A particularly important AHCPR activity is the Dental Scholar in 
Residence program, which is now moving into its second year. The Dental 
Scholar in Residence was established in 1997 to assist the agency in 
conducting research to improve the delivery of effective dental and 
oral health services and to facilitate collaborative relationships 
among professional, educational, research, and other health industry 
sectors involved with oral health care. The very first recipient of 
this award focused on efforts to increase communication, cooperation, 
and collaboration among communities engaged in quality improvement 
efforts and the dental profession, and examined the integration of oral 
health services into comprehensive primary care systems. This work will 
help improve the knowledge base for informed oral health care policy.
    Conclusion.--Finally, the AADS would like to recognize the 
achievements of the U.S. Public Health Service on the occasion of its 
bicentennial year in 1998. In 200 years much has been accomplished in 
conquering disease and disabling conditions. In this century alone, 30 
years of have been added to the average life span. Fully 25 of those 
added years are due to public health interventions. But to continue 
meeting the challenges ahead we must continue to invest in a continuum 
of public health activity that not only includes biomedical and 
behavioral research, but also invests in disease prevention and health 
promotion, targeted health care services for vulnerable populations, 
education of a primary care and public health workforce, and health 
services research.
    Mr. Chairman, I thank you again, on behalf of the AADS and its 
membership, for this opportunity to present our views and our budget 
requests for dental education programs in fiscal year 1999. We believe 
these programs are important public health activities essential to 
maintaining a highly-skilled, well-trained health professions workforce 
and achieving important national oral health goals.
                                 ______
                                 
  Prepared Statement of Alan Shalita, M.D., President, Association of 
                       Professors of Dermatology
    Mr. Chairman and Members of the Subcommittee: My name is Alan 
Shalita, M.D. I am a Distinguished Teaching Professor at the State 
University of New York (SUNY) Health Science Center in Brooklyn and my 
curriculum vitae is enclosed. I am also the current president of the 
Association of Professors of Dermatology (APD). The membership of the 
APD includes the heads of all academy departments of dermatology, as 
well as all dermatology program directors. The APD receives no federal 
funding.
    My colleagues and our patients thank you, Chairman Specter, and 
members of the Subcommittee for your continued support of the National 
Institutes of Health (NIH). The membership of the APD is grateful that 
biomedical research enjoys bipartisan support in this Subcommittee and 
in Congress.
    Our Nation's biomedical research infrastructure is an intricate 
relationship of academia, industry, and the federal government. The NIH 
serves as the primary source for basic research through universities 
and independent research institutions. This synergy has alleviated 
suffering for millions of Americans by fostering the development of 
innovative treatments, including drugs and vaccines. Biomedical 
research is the foundation upon which all medical care is based. 
Without the NIH, we would not be the world leader in research and 
patient care.
    To ensure that the mission of the NIH continues and that we are 
able to exploit the many research opportunities before us, the APD 
joins with our sister societies in dermatology, as well as the 
Coalition of Patient Advocates for Skin Disease Research, the NIAMS 
Coalition, and the Ad Hoc Group for Medical Research Funding to request 
a funding increase of 15 percent for the NIH in fiscal year 1999.
    One in three Americans suffer with a serious skin disease. Our 
economy also suffers. The cost of treatment of skin disease will exceed 
$7 billion this year, and occupational skin disease ranks among the 
most prevalent causes of workers' compensation claims. While few skin 
diseases are fatal, they are chronic, costly, and common. They inhibit 
the ability of many Americans to live independent, productive, and tax-
paying lives. They can also be disfiguring and can cause the patient to 
suffer emotional and psychological distress.
    We are poised at the brink of an exciting new era of dermatology, 
during which we expect to make rapid advances in the understanding of 
skin biology and the pathogenesis of skin disease. This new knowledge 
will provide us more effective treatments for many skin diseases. It is 
critical that we do not lose the scientific momentum of the previous 
decades of NIH funded research.
    Much of the skin disease research conducted at the NIH is funded by 
the National Institute of Arthritis, Musculoskeletal and Skin Diseases 
(NIAMS). The NIAMS research portfolio is very diverse. It supports 
basic and clinical research encompassing an astonishing number of 
diseases affecting the three largest organ systems in the body. As our 
population ages, the debilitating diseases of the skin, joints, bones, 
muscles, and connective tissue will affect an ever larger proportion of 
our population.
    A 15 percent increase in the budget of NIAMS would provide a fiscal 
year 1999 appropriation of $316 million. This amount represents 
approximately 2 percent of our annual expenditure for skin disease 
treatment. Without adequate funding, many promising new areas of 
research will not be advanced. Opportunities to relieve the pain and 
suffering of our patients and their families will be delayed.
    There are a number of immediate opportunities in basic skin 
research that I would like to share with you. Advances in molecular 
biology and genetics have helped us to make great strides in 
understanding skin disease. The establishment of a basic science base 
has greatly assisted our search for mutated genes responsible for 
various genetic skin disorders. Now, the search for these genes can be 
more easily narrowed to candidate regions, such as the epidermal 
differentiation complex and other areas of chromosome 1.
    Scientists now know the location of a gene that predisposes people 
to systemic lupus erythematosus (lupus), a chronic autoimmune disease 
that has been of great interest to members of this Subcommittee. 
Researchers have localized the gene to a region near the end of the 
``long arm'' of chromosome 1. Additional research is needed to help us 
to identify those infectious agents and environmental factors that 
trigger this disease in susceptible individuals. In addition, funding 
of prevention research in lupus has helped us to develop sophisticated 
education programs to screen young African-American women at risk for 
the disease. It is hoped that these screening programs will allow us to 
diagnose the disease at its earliest stages, thereby reducing the 
severity of the disease and its costs.
    The Ichthyoses are a family of heritable skin diseases in which 
there is an abnormal development of the outermost layers of the skin. 
Previously, scientists had demonstrated a linkage between certain forms 
of ichthyosis and mutations in a particular gene that codes for the 
most common proteins in our epidermis, the keratins. In more recent 
findings, another rare form of this disease has been shown to be linked 
to a mutation in a region of chromosome 1, called the epidermal 
differentiation complex. It is hoped that this discovery will one day 
lead to relief from the self-amputation that is a characteristic of the 
disease.
    In the past decade, important advances have been made in our 
knowledge of the structure and function of the skin, largely through 
understanding the more serious forms of genetic diseases, such as 
epidermolysis bullosa (EB). EB is a complex group of genetic disorders 
that cause the skin to be so fragile that the slightest friction can 
cause blistering of the skin. These blisters often lead to infection. 
In its most severe form, the blistering of EB leads to chronic, 
unremitting wound healing which results in extensive scarring of the 
affected skin. It is our hope that EB will be the first candidate for 
gene therapy in skin disease. Researchers are now exploring the use of 
retroviruses and other exciting avenues for gene therapy in EB.
    Recent studies have significantly advanced our understanding of 
skin cancer, the most common of all cancers. This year, over one 
million Americans will be diagnosed with some form of skin cancer, more 
than all other cancers combined. This year, 8,500 individuals will, 
like your colleague Steven Schiff, die from skin cancer. While we mourn 
these individuals, I can report that we are making progress in our 
battle against skin cancer.
    Scientists have uncovered a gene involved with the most common form 
of skin cancer--basal cell carcinoma. A mutation in the gene that 
controls the growth and development of the skin, may be responsible for 
a rare, inherited disorder called basal cell nevus syndrome, as well as 
acquired basal cell carcinoma. Scientists hope that this discovery will 
lead to more novel, less invasive treatments for skin cancer. 
Scientists are also hard at work on the development of a melanoma 
vaccine.
    The poets contend that the eyes are the mirror to the soul. As a 
dermatologist, I can tell you that it is the skin. The skin is the 
mirror to internal disease. There are very few diseases that do not 
have skin manifestations. In addition, the skin is also an efficient, 
important and potent delivery system for drugs for many diseases. 
Therefore, skin disease research is necessary if progress is to be made 
in treating many other illnesses.
    In addition to the important research at the bench, clinical 
research is a very important mission and one that has been historically 
underfunded at the NIH. Improved support of clinical research is 
extremely important if we are to take the discoveries I discussed 
earlier and translate them into improvements in patient care.
    Clinical research is in jeopardy. Managed care has significantly 
impacted the financial ability of our major academic health centers to 
support clinical research. The APD supports the recommendations of the 
Nathan report and an increased commitment by the NIH in the area of 
clinical research.
    Funding basic and clinical research will be unnecessary, however, 
if we are unable to attract and retain the brightest minds in basic and 
clinical skin research. A diverse base of scientific talent is needed 
to ensure the survival of the NIH, academia and industry. The education 
of the next generation of scientists, especially physician scientists, 
must remain a national priority.
    As a professor and researcher, I can attest to the steady decline 
in the number of physicians who elect to pursue a career in research. 
Our young people have been discouraged by the unpredictability of 
funding. Managed care has also played a role, inhibiting the ability of 
experienced clinical investigators to mentor their younger colleagues. 
The training of physician scientists has proven to be one of our most 
productive ways to integrate basic and clinical research. Physician 
scientists are our best hope of translating the exciting advances in 
molecular biology and genetics to the bedside. The APD, therefore, 
supports efforts by the NIH to offer new and expanded initiatives in 
research training.
    Our Nation's biomedical research effort is a complex, balanced 
system that synergizes contributions made by universities, industries, 
and government. Our unique biomedical research infrastructure has 
allowed us to lead the world in biomedical research, to reap numerous 
Nobel Prizes in Medicine and Physiology, and to birth the biotech 
industry.
    I urge you to maintain our position, and again request a 15 percent 
increase in appropriated funding for the NIH in fiscal year 1999.
                                 ______
                                 
   Prepared Statement of the American Academy of Physician Assistants
    On behalf of the more than 31,000 clinically practicing physician 
assistants in the United States, the American Academy of Physician 
Assistants is pleased to submit comments on fiscal year 1999 
appropriations for Physician Assistant (PA) education programs that are 
authorized through Title VII of the Public Health Service Act.
Overview of Physician Assistant Education and Practice
    As committee members may be aware, PA programs provide students 
with a primary care education that prepares them to practice medicine 
with physician supervision. The first PA program was started at Duke 
University approximately 30 years ago, and today there are 104 
accredited PA educational programs.
    Prior to admission, the typical PA student has a bachelor's degree 
and over four years of health care experience. PA education typically 
is 25 months in length and includes more than 400 hours in basic 
sciences, more than 149 hours in behavioral sciences, and more than 535 
hours in clinical medicine. PA students also complete more than 2,000 
hours in clinical rotations, with an emphasis on primary care. Upon 
completion of an accredited PA program, PAs must complete a rigorous 
national certifying exam administered by the National Commission on 
Certification of Physician Assistants. To maintain their certification, 
PAs must complete 100 hours of continuing medical education every two 
years and take a recertification exam every six years.
    PAs work in virtually every type of medical and surgical specialty, 
including family/general medicine, internal medicine, obstetrics/
gynecology, pediatric medicine, occupational medicine, and emergency 
medicine. PAs' primary employment settings include individual physician 
offices, group practices, managed care organizations, hospitals, and 
outpatient clinics.
Contribution of PAs as Primary Care Providers
    The PA profession has a long standing commitment to practice in our 
nation's small towns, rural areas, and underserved communities. PAs 
play a pivotal role in expanding access to primary care services, 
particularly in medically underserved communities. Data collected in 
1997 show that over half of the PA profession is in family/general 
practice medicine, general internal medicine, general pediatrics, and 
obstetrics/gynecology. More than a third of the profession practice in 
communities of less than 50,000 people.
    Studies conducted by the Rand Corporation have found that PAs save 
costs, can perform a substantial portion of the functions in an 
ambulatory care practice, and are widely accepted by patients. The 
congressional Office of Technology Assessment studied health care 
services provided by PAs and determined that ``within their scope of 
practice, physician assistants provide health care that is 
indistinguishable in quality from care provided by physicians.''
Critical Role of the Title VII, Public Health Service Act, Programs
    Despite an increase in state health insurance reforms, a reduced 
rate of growth in health care spending, and the emergence of a new 
children's health insurance program, a growing number of Americans lack 
access to primary care, either because they are uninsured, 
underinsured, or they live in a community with an inadequate supply or 
distribution of providers. The growth in the uninsured US population 
increased from approximately 32 million in the early 1990s to more than 
40 million today. Simultaneously, the number of medically underserved 
communities continues to rise, from 1,949 in 1986 to 2,723 in 1998.
    The role of the Title VII programs is to alleviate these problems 
by supporting access to quality, affordable, and cost-effective care in 
areas of our country that are most in need of health care services, 
specifically rural and urban underserved communities. This is 
accomplished through the support of educational programs that train 
more health professionals in fields experiencing shortages, improve the 
geographic distribution of health professionals, and increase access to 
care in underserved communities.
    The Title VII programs are the only federal education programs that 
are designed to address the supply and distribution imbalances in the 
health professions. Since the establishment of Medicare, the costs of 
physician residencies, nurses and some allied health professions 
training has been paid through Graduate Medical Education (GME) 
funding. However, GME has never been available to support PA education. 
More importantly, GME was not intended to nor does it generate a supply 
of providers who are willing to work in the nation's medically 
underserved communities. That is the purpose of the Title VII Public 
Health Service Act Programs, which support such initiatives as loans 
and scholarships for disadvantaged students, scholarships for students 
with exceptional financial need, centers of excellence to recruit and 
train minority and disadvantaged students, and interdisciplinary 
initiatives in geriatric care and rural health care.
Title VII Support of PA Education Programs
    Federal funding for PA education programs is authorized through 
Section 750 of the Public Health Service Act and supports the planning, 
development, and operation of projects for the education of PAs and PA 
faculty development programs. The funds ensure that PA students from 
all backgrounds have continued access to an affordable education and 
encourage PAs, upon graduation, to practice in underserved communities. 
These goals are accomplished by funding PA education programs that have 
a demonstrated track record of: (1) placing PA students in health 
professional shortage areas; (2) exposing PA students to medically 
underserved communities during the clinical rotation portion of their 
training; and (3) recruiting and retaining students who are indigenous 
to communities with unmet health care needs.
    Following are three examples of how well PA programs have responded 
to the intent of the Title VII programs.
  --A Texas PA program established the objective of having its students 
        complete their family medicine rotation in medically 
        underserved sites. Through assistance from Title VII funding, 
        the PA program established sufficient clinical training sites 
        to require each student to complete a family medicine rotation 
        in a rural medically underserved community. As a result of this 
        requirement, a greater percent of the program's graduates now 
        enter family medicine and take positions in medically 
        underserved communities.
  --Several PA programs, including the University of California--Davis, 
        the University of Texas--Galveston, and the University of 
        Washington, have used Title VII funding to ``place bound'' 
        students. The ``place bound'' PA students are indigenous to the 
        underserved communities where they receive their training and 
        return to their communities to practice after graduation. These 
        programs specifically target Hispanic and rural disadvantaged 
        students.
  --A Washington state program recently placed two PA graduates in the 
        Yakima Valley Farmworkers Clinic. One PA was previously a 
        medical assistant and from a migrant family; the other PA was 
        formerly a respiratory therapist in Walla Walla. Upon 
        graduation, both PAs chose to practice at the farmworker 
        clinic.
    Without Title VII funding, many of these special PA training 
initiatives would not be possible. Institutional budgets and student 
tuition fees simply do not provide sufficient funding to meet the 
special, unmet needs of medically underserved areas or disadvantaged 
students. Nevertheless, the need is very real, and Title VII is 
critical in meeting it.
Need for Increased Title VII Support for PA Education Programs
    Increased Title VII support for educating PAs to practice in 
underserved communities is particularly important given the market 
demand for physician assistants. Without the Title VII funding to 
expose students to underserved sites during their training, PA students 
are far more likely to practice in the communities where they were 
raised or the communities in which they attended school. Title VII 
funding is a critical link in addressing the natural geographic 
maldistribution of health care providers by exposing students to 
underserved sites during their training, where they frequently choose 
to practice following graduation.
    The supply of physician assistants is inadequate to meet the needs 
of society, and the demand for PAs is expected to increase. A 1994 
report of a workgroup of the Council on Graduate Medical Education 
(COGME), ``Physician Assistants in the Health Workforce,'' estimated 
that the anticipated medical market demand and the estimated workforce 
requirements for PAs would exceed demand. Additionally, the Bureau of 
Labor Statistics projects that the number of available PA jobs will 
increase 47 percent between 1996 and 2002.
    Despite the increased demand for PAs, funding has not 
proportionately increased for the Title VII programs that are designed 
to educate and place physician assistants in underserved communities. 
Between fiscal year 1994 and fiscal year 1997, PA program funding went 
from $6.5 million down to $5.9 million and, as of fiscal year 1997 was 
restored to $6.376 million. PA program funding was slightly increased 
again for fiscal year 1998 at $6.398 million. In 1992-1993, 
approximately 64 percent of 55 PA programs received federal support, at 
an average of $143,500 per grant. In 1996-1997, less than half of 77 PA 
programs reported receiving federal support, at an average of $152,300 
per grant.
Recommendations on Fiscal Year 1999 Funding
    The American Academy of Physician Assistants urges members of the 
Appropriations Committee to consider the inter-dependency of all the 
public health agencies and programs when determining funding for fiscal 
year 1999. For instance, while it is important to fund clinical 
research at the National Institutes of Health (NIH) and to have an 
infrastructure at the Centers for Disease Control (CDC) that ensures a 
prompt response to an infectious disease outbreak, the good work of 
both of these agencies will go unrealized if the Health Resources and 
Services Administration (HRSA) is inadequately funded. HRSA administers 
the ``people'' programs, such as Title VII, that bring the cutting edge 
research discovered at NIH to the patients--through providers such as 
PAs who have been educated in Title VII-funded programs. Likewise, CDC 
is heavily dependent upon an adequate supply of health care providers 
to be sure that disease outbreaks are reported, tracked, and contained.
    The critically important programs administered by NIH, HRSA, and 
CDC are integral components within the nation's public health 
continuum. One component is not more important than another, and no one 
component can succeed without adequate support from each of the other 
elements. The Academy is particularly concerned that any increase for 
the NIH not be made at the expense of the health professions education 
program or other public health programs, as recommended this year by 
the Senate Budget Committee.
    The American Academy of Physician Assistants is particularly 
appreciative of the increases in funding for PA education programs that 
were appropriated during the 104th Congress and the 1st Session of the 
105th Congress. However, these increases have not been sufficient to 
meet the increasing demand for PA graduates in the growing number of 
medically underserved communities. Accordingly, the Academy 
respectfully requests that PA programs be funded in fiscal year 1999 at 
their current authorized level of $9 million.
    Thank you for the opportunity to present the American Academy of 
Physician Assistants' views on fiscal year 1999 appropriations.
                                 ______
                                 
         Prepared Statement of the American Dental Association
    Mr. Chairman and Members of the Subcommittee: The American Dental 
Association (ADA) is submitting this testimony on behalf of its 140,000 
members. With passage of the State Children's Health Insurance Program 
(CHIP), and reforms of the Medicaid program, which for some time has 
included a comprehensive children's oral health benefits program, last 
year was truly the year of the child. This subcommittee contributed 
significantly to the efforts to address the health needs of children 
through its continued support of dental education, research, and 
disease prevention.
    The ADA believes this year offers new opportunities for this 
subcommittee to target funding for programs designed to address the 
continuing oral health care needs of the children in this nation, 
especially those in the underserved populations. While almost half of 
the children entering school in this country are free of tooth decay 
and fillings, we recognize these gains have not been realized equally 
by all Americans. Among school age children, 25 percent suffer 75 
percent of the tooth decay. That 25 percent typically represent 
children who are from low income or socially disadvantaged families or 
live in non-fluoridated states. For example, in Hawaii, which has a 
fluoridation rate of only 13 percent, 80 percent of the children under 
the age of 6 suffer from tooth decay.
               maternal child health--fluoridation grants
    The Association would like to thank the subcommittee for its 
support last year for funding SPRANS activities within the Maternal 
Child Health block grant that enhanced community water fluoridation 
efforts. This grant money will be used by states with less than 25 
percent community water fluoridation to help those states develop plans 
for expanding their level of participation. For example, the city of 
Los Angeles receives water from 40 different systems. A great deal of 
planning must take place before fluoridation can begin.
    The American Dental Association recommends that the subcommittee 
continue to fund these efforts for the third and final year of the 
grants at the current level of $500,000.
                        division of oral health
    As the federal agency with primary responsibility for community-
based programs designed to prevent oral disease and promote oral 
health, the Division of Oral Health (DOH) within the Centers for 
Disease Control and Prevention (CDC) works closely with state and local 
governments to develop and implement prevention and control efforts, 
including water fluoridation and dental sealant initiatives. The 
reduction of severe tooth decay (caries) is a major priority for the 
DOH as 53 percent of children ages 6-8 and 78 percent of 15-year-olds 
have experienced dental caries, and more than 100 million Americans 
lack the benefits of fluoridated water despite its proven effectiveness 
in fighting dental decay.
    Once the seven states that qualified for SPRANS grants determine 
how to increase their fluoridation rates, they will look to the DOH 
within the CDC for assistance to implement those plans. CDC issues 
grants to states for preventive health services. The Association 
believes that providing funding for fluoridation efforts should be a 
high priority for CDC. The demand for fluoridation funding will be 
driven by not only the states receiving SPRANS grant money, but also by 
states that need to replace worn equipment or expand access for new 
communities due to growth and development.
    Another effective preventive strategy commonly used for protecting 
permanent molars in children is the application of dental sealants. 
Healthy People 2000 calls for 50 percent of the children to have these 
protective barriers against dental decay. A recent national study found 
that children with sealants had significantly less untreated dental 
decay than children without sealants. However, despite their 
effectiveness, less than 30 percent of U.S. children have received 
dental sealants and only half the states have school-based programs to 
extend this important preventive intervention to the neediest youth. 
The DOH will examine which states provide the best model programs and 
then will encourage others to adopt them.
    The Association recommends that $6 million be appropriated for the 
DOH to increase and expand community-based and school-based efforts to 
improve the oral health of children.
                 national institute of dental research
    The Association also recognizes the need for increased research by 
the National Institute of Dental Research (NIDR) to better understand 
the various oral diseases that afflict children, including disorders, 
diseases, and to study normal development that affects tissues of the 
craniofacial-oral-dental complex.
    Last year the NIDR held a conference on ``Early Childhood Caries.'' 
The NIDR conference concluded that the prevalence of early childhood 
caries continues to be a significant societal problem and federal 
agencies must work together to address this important public health 
issue. Oral diseases can cause serious illness, debilitation, 
significant pain, interference with eating, poor self-image, over use 
of emergency rooms and valuable time lost from school. In fact, in 1989 
over 51 million school hours were lost due to dental-related illness.
    These diseases and disorders cause untold pain and suffering for 
those afflicted, but they also adversely affect our society as a whole, 
reflected in increased health care costs and loss of productivity. For 
example--one in every 33 babies born in 1995 had at least one 
anatomical birth defect, three-fourths of which affected the head, 
face, and neck. The most common craniofacial defect is cleft lip, 
affecting one in 500 births. Lifetime costs for the treatment of clefts 
and associated speech, hearing and other problems are estimated to be 
$100,000 per patient.
    Genetic research being carried out by the NIDR, including that to 
determine the causes of craniofacial birth defects, is fundamental for 
identifying which gene(s) cause(s) these conditions. Furthermore, 
additional research being done by NIDR scientists is focusing on how to 
correct these conditions through the growth of new bone and soft 
tissue--a process called biomimetics.
    Periodontal disease may be one of the contributing factors 
resulting in the approximately 250,000 low birth weight (LBW) babies 
born each year. In fact, it has been established that women with 
periodontal disease are seven times more likely to have LBW babies. 
Other studies show that there may be an association between periodontal 
disease and cardiovascular diseases.
    NIDR has long been a leader in pain research. The NIH Pain Research 
Consortium encourages information sharing and collaborative research 
efforts within NIH, and it sponsored a major symposium in November 
1997, fostering new ideas and collaborative studies on pain research. 
Some diseases or disease treatments cause chronic pain at an estimated 
cost of $100 billion a year according to pain specialists, so the 
benefits emanating from the agency's efforts in this arena should reach 
far beyond oral health care concerns.
    The Association recommends a funding level of $240.8 million for 
NIDR so that it can expand its research and help reduce oral diseases 
that afflict children.
               agency for health care policy and research
    The Agency for Health Care Policy and Research (AHCPR) is working 
to facilitate the introduction of advances in biomedical research into 
the dental practice setting, improving the quality and cost-
effectiveness of oral health care.
    It is important to provide sufficient funds for continuation and 
enhancement of the Medical Expenditure Panel Survey (MEPS), which began 
in 1997. However, the dental care component of this survey must be 
improved, to provide more accurate estimates of utilization patterns, 
composition of services, and costs of care and how these are influenced 
by characteristics of patients, providers, and insurance plans.
    The findings from research supported by NIH and AHCPR are openly 
shared within the scientific and professional communities to maximize 
the benefits to the public of this investment. There must be support 
for a continuum of research--from basic, biomedical (bench), and 
clinical research, through controlled clinical trials, outcomes 
research, and cost-effectiveness trials.
    We must understand not only what causes diseases and how they can 
be prevented or treated, but also what works in dental practice and how 
much it costs. Research supported by AHCPR will assist dental 
practitioners by providing the evidence base for selecting among 
alternative dental treatments. AHCPR's research is also needed to 
improve the system providing health care, so that the fruits of 
biomedical research are readily available to all citizens.
    The Association supports the expansion of AHCPR's outcomes and 
effectiveness research program, which has the potential to improve the 
evidence base for selecting among alternative diagnostic and dental 
treatments. Advances in this program, for example, would enable AHCPR 
to improve the treatment of musculoskeletal disorders, including 
temporomandibular disorders (TMD), improving the science base for both 
medical and dental practitioners and providing information needed to 
establish reimbursement policies that would enable patients to receive 
the treatment most appropriate for their needs.
    The Association recommends a funding level of $175 million.
                            dental education
    General Dentistry Residencies Program.--The General Dentistry 
Residencies program furnishes young dentists with valuable clinical 
experience, while offering care to underserved populations. The 
training is similar to that experienced by primary care physicians in 
their internships. Most graduates of the program remain in primary care 
with many establishing practices in underserved areas. This helps to 
meet the federal goal of increasing access to primary care.
    The Association would also like to bring to the subcommittee's 
attention the increasing need for more pediatric dentists. Between 1993 
and 2020 the number of children under the age of 15 will increase by 
8.1 million. However, we are not training enough pediatric dentists to 
replace those who retire or have the bad judgment to die. Today there 
are fewer than 4,000 pediatric dentists in the nation. This is a 
critical shortage because pediatric dentists treat approximately 42 
percent of Medicaid children and 57 percent of medically compromised 
children. Therefore, the Association is supporting authorizing language 
to include pediatric residencies in the health professions program.
    The Association recommends that $4 million be appropriated for 
fiscal year 1999 for the General Dentistry Program, which is $200,000 
above the current funding level. If Congress should approve an 
authorization for pediatric dental residencies, the ADA will provide 
the subcommittee with a more accurate funding request.
    The General Dentistry program is part of the Health Professions 
Training and Nursing Education Program. The ADA also endorses a request 
from the Health Professions and Nursing Education Coalition for a 
funding level of $306 million for all of the programs.
    Ryan White HIV/AIDS Dental Reimbursement Program.--The Ryan White 
HIV/AIDS Dental Reimbursement program helps fund oral health care 
services for people living with HIV/AIDS. Dental students and residents 
also benefit as they gain extensive experience in caring for patients 
with special dental needs. In fiscal year 1997, 104 institutions 
participated, serving over 70,000 patients.
    By covering the costs of providing quality care to people living 
with HIV/AIDS, this program can prevent much more serious and expensive 
health complications. Oral disease left untreated can lead to 
significant pain, oral infections, and fevers; difficulty in eating, 
speaking or taking medication; and medically dangerous weight loss. 
Furthermore, dental services under Medicare and Medicaid coverage for 
adults is often inadequate, so receiving a prompt diagnosis and 
appropriate treatment for these oral conditions is often difficult for 
uninsured poor individuals.
    The Association requests $9 million for the Ryan White HIV/AIDS 
Dental Reimbursement program, an increase of $1.2 million over the 
current funding level.
    National Health Service Corps Scholarship and Loan Forgiveness 
Programs.--We strongly support the NHSC Scholarship and Loan 
Forgiveness Programs, which assist students with the rising costs of 
financing their health professions education while promoting primary 
care access to underserved areas.
    Over the last several years, and most recently in fiscal year 1998 
appropriations report language, Congress has instructed the NHSC to 
increase dental participation in the loan repayment and scholarship 
awards programs. However, the number of dental loan repayment awards 
has increased slowly in recent years. According to a Department of 
Health and Human Services survey, currently 3,032 dentists are needed 
to service 957 designated dental Health Professions Shortage Areas 
(HPSAs), as compared to 1,400 dentists needed for 792 HPSAs prior to 
1993.
    We ask the subcommittee to further pursue the need for increased 
dental participation in both the NHSC scholarship and loan repayment 
programs.
    Health Professions Education and Training Programs for Minority and 
Disadvantaged Students.--We request funding increases for the minority 
and disadvantaged assistance programs that are proportional to current 
funding levels within the context of the fiscal year 1999 budget 
request of $306 million for all of Title VII and Title VIII of the 
Health Professions programs recommended by the Health Professions and 
Nursing Education Coalition (HPNEC).
    Other Programs Under Title VII of the Public Health Service Act.--
We also urge the subcommittee to fund the following programs at the 
levels advocated by the HPNEC Coalition because of their importance in 
promoting access to healthcare for special populations: Rural Health 
Training and the Health Education and Training Centers programs, 
Geriatric Initiatives, Area Health Education Centers, and Allied Health 
Special Projects.
    Student Loan Programs.--The ADA is concerned about the ability of 
students pursuing a health professions education to access affordable 
federal financial aid due to the phase-out of the Health Education 
Assistance Loan (HEAL) program. We welcomed the Secretary of 
Education's earlier action raising the annual and aggregate 
unsubsidized Stafford Loan limits; however, this action does not meet 
the full need of the health professions community due to the 
limitations accompanying the new policy. The ADA is urging the 
Department of Education to broaden the pool of students eligible for 
the increased annual and aggregate Stafford loan limits to accommodate 
all health professions students seeking assistance. We urge the 
subcommittee to support this effort.
    We also request the subcommittee's continued support for the Health 
Professions Student Loan (HPSL) program, which could provide additional 
low cost student loan funds to meet the financial needs of health 
professions students previously served by the HEAL program. HPSL funds 
should be used to assist institutions in developing and maintaining a 
sufficient revolving fund.
    Thank you, Mr. Chairman and members of the subcommittee, for your 
thoughtful consideration of the ADA's recommendation.
                                 ______
                                 
   Prepared Statement of the American Association of Retired Persons
    The American Association of Retired Persons (AARP) appreciates this 
opportunity to comment on appropriations for various programs which 
benefit older Americans, especially the low-income and minority 
elderly. Our recommendations are summarized as follows:
  --At a minimum, maintain Older Americans Act programs at current 
        services levels;
  --Provide no less than $1.215 billion in regular funds for the Low 
        Income Home Energy Assistance Program;
  --Make available sufficient resources for: Medicare+Choice 
        Provisions; the Agency for Health Care Policy and Research; the 
        Inspector General's Office, Department of Health and Human 
        Services; State Survey and Certification activities; the Social 
        Security Administration; and the National Senior Service Corps.
Older Americans Act (OAA)
    Since its enactment over thirty years ago, the Older Americans Act 
has enabled millions of older citizens--especially those with 
disabilities--to remain independent and productive. Many of these 
individuals would have been institutionalized, were it not for the home 
and community-based services provided by this landmark legislation. 
AARP urges at least an inflation adjustment for these vital programs 
next year, an amount that is roughly $29 million over the existing 
$1.305 billion appropriation. The Administration proposes no increases.
    To the extent additional resources are available, we recommend 
increases above inflation in all OAA programs. This is particularly 
critical for Title IV Training, Research and Discretionary Projects, 
which were substantially reduced in 1996. These activities are 
necessary if we are to expand our knowledge about the needs of an aging 
society.
    We applaud Congress for providing modest increases this year in 
many OAA activities. Among other things, the extra funds mean 
nutritional meals for more seniors, particularly those who are isolated 
and frail. OAA's Home-Delivered Meals Program is very often the only 
human contact some of these persons have in a given day. And their 
lives are enriched by these visits in ways which cannot always be 
measured. Over 240 million congregate and home-delivered meals are 
delivered annually. The increases will also provide additional 
supportive services--services which include more than 40 million rides 
for doctor and pharmacy visits, nearly ten million personal care visits 
to those in need, and roughly one million legal counseling sessions.
    As one of the national sponsors of OAA's Senior Community Service 
Employment Program (SCSEP), the Association has first-hand knowledge 
regarding its effectiveness. SCSEP has made a real difference in the 
lives of many unemployed, low-income older Americans by providing part-
time employment in useful community service activities. Many of the 
nutrition programs and other services for seniors, as well as important 
programs serving the broader community, such as library services and 
day care centers, are dependent on work provided by older persons 
through the Senior Community Service Employment Program. Compared with 
younger workers, older workers--once unemployed--tend to be jobless 
longer and are likely to earn less when--and if--hired. More than 
94,600 older Americans were SCSEP participants in the 1996/97 program 
year.
Low Income Home Energy Assistance Program (LIHEAP)
    The Association strongly urges at least $1.215 billion in regular 
funds next year for this critical program, an amount equal to the total 
spending level in fiscal year 1997. Because this program is advance 
funded, Congress provided $1.1 billion for fiscal year 1999 in the 
fiscal year 1998 appropriation. We are recommending an increase of $115 
million over that level for the coming fiscal year. We also recommend 
the same amount for the fiscal year 2000 advance appropriation. The 
Administration is proposing $1.1 billion for this purpose. LIHEAP is 
important to all of its beneficiaries, but none more so than low income 
older persons. Housing, health care, energy costs--all of these factors 
add to the stress of living on a tight budget. For some, the question 
of how to heat their homes is actually a matter of life or death.
    Some LIHEAP recipients are `working poor' or elderly who do not 
receive any other public assistance through welfare, food stamps, SSI, 
or subsidized housing. LIHEAP is a vital measure of last resort for 
these individuals. Because they are more likely to live in older, 
poorly insulated homes, older persons--particularly the elderly 
minority poor--also have a heightened risk of hypothermia. Among low 
income households, the proportion of income expended for energy 
consistently amounts to 3-4 times the proportion spent by households 
across the board. Based on the latest available data, of the 29 million 
households eligible for LIHEAP assistance in 1995, roughly 41 percent 
had at least one person over the age of 60. Only 13 percent of these 
eligible elderly households actually received heating assistance. 
Program funding reached its peak in 1985 when Congress appropriated 
$2.1 billion. By 1996, funding had dropped to $1 billion, and the 
number of participating households declined that year from 5.8 million 
to 4.4 million.
Implementation of Medicare+Choice
    The new Medicare+Choice program in the Balanced Budget Act of 1997 
(BBA) established a number of new Medicare delivery system options. By 
the end of 1998 the new law anticipates that the Health Care Financing 
Administration (HCFA) will conduct a major public education campaign to 
provide Medicare's 38 million beneficiaries with the information they 
need to make educated choices about their Medicare coverage. The 
success of Congress' effort in the BBA to expand the choices available 
to Medicare beneficiaries will depend heavily on whether HCFA has the 
resources and staffing needed to implement the specific and extensive 
requirements of the law. The Association recommends appropriate funding 
next year to implement the Medicare+Choice program. Currently, HCFA's 
funding for implementation of the BBA is only about $2.40 per 
beneficiary. This will not be adequate to ensure that beneficiaries 
have the information they need to make informed choices about their 
health care.
Agency for Health Care Policy and Research
    The Association urges adequate funding for the Agency for Health 
Care Policy and Research, and in particular the Medical Treatment 
Effectiveness Program (MEDTEP). If we are to find ways to lower the 
growth in the cost of health care without jeopardizing quality of care, 
the outcomes research undertaken by this Agency will be critical.
Office of Inspector General--Department of Health & Human Services
    AARP urges adequate funding for the Department of Health and Human 
Services' Office of Inspector General. In order for fraud and abuse in 
the Medicare and Medicaid programs to be reduced, adequate resources 
must be available to detect, investigate and prosecute unscrupulous 
providers. This should include appropriate funding for maintaining and 
expanding the Inspector General's fraud hotline, an integral part of 
the effort to reduce fraud.
Medicare Contractor Funding
    Medicare contractors are a source for information about changes in 
the Medicare program. Currently, most contractors have outreach 
programs for the physicians in their region. Given the magnitude of 
changes in the program required by the Balanced Budget Act of 1997, 
outreach by contractors to address beneficiaries' questions and provide 
clear and accurate information will be critical. We urge the 
Subcommittee to provide adequate funding for Medicare contractors that 
takes into account the need for beneficiary outreach activities. This 
funding should not substitute for the resources needed by the Health 
Care Financing Administration to implement the new Medicare+Choice 
program.
Survey and Enforcement
    The Association supports sufficient funding to provide adequate 
levels of survey and enforcement activities to assure that home health 
agencies and skilled nursing facilities deliver quality care to 
Medicare and Medicaid beneficiaries. Currently, inadequate funding has 
meant that nursing homes cited for deficiencies during the survey 
process do not receive follow-up visits to guarantee that they have 
come into compliance. As a result of limited funding to make the 
revisits, the appropriate sanctions cannot be imposed. Any additional 
reduction in funding could have a significant adverse effect on the 
quality of care, particularly given the added responsibilities placed 
on HCFA and the states in the Balanced Budget Act of 1997.
Displaced Homemaker Program
    AARP supports providing sufficient funds to begin implementing the 
Displaced Homemakers Self-Sufficiency Assistance Act. For many older 
women who have been outside the workforce for decades, workforce re-
entry is extremely difficult. As the workforce ages, and the older 
workforce becomes increasingly female, the services provided by the Act 
and similar programs will assume correspondingly greater importance.
Social Security Administration (SSA) Staffing Levels
    We remain concerned that inadequate funds for SSA could hamper the 
agency's ability to deliver quality service. The most noticeable 
evidence of deteriorating service is the ongoing backlog of disability 
applications, which continue despite agency initiatives. AARP urges the 
Subcommittee to provide sufficient resources next year to address this 
backlog and for other critical activities, such as implementing the 
congressional mandate for electronic transfer of all federal payments.
National Senior Service Corps (NSSC)
    The NSSC programs--namely, Foster Grandparents, Senior Companions, 
and Retired Senior Volunteers--have been successfully matching skilled 
older Americans with unmet community needs since 1973. We appreciate 
the additional funds provided by Congress this year and urge at least 
an inflation adjustment for these critical activities.
    Thank you again for this opportunity to comment on programs which 
benefit older Americans.
                                 ______
                                 
       Prepared Statement of the American Psychiatric Association
Introduction and background
    Chairman Porter and members of the Subcommittee, the American 
Psychiatric Association would like to present recommendations regarding 
the fiscal year 1999 appropriations for the National Institute of 
Mental Health (NIMH), National Institute on Drug Abuse (NIDA), the 
National Institute on Alcohol Abuse and Alcoholism (NIAAA), and the 
Center for Mental Health Services (CMHS) at the Substance Abuse and 
Mental Health Services Administration (SAMHSA). The APA wishes to 
associate this statement with the statement of the Ad Hoc Group for 
Medical Research Funding, which calls for a 15-percent increase in NIH 
funding for fiscal year 1999, as a first step toward doubling the NIH 
budget over five years.
    The prevalence and impact of mental illness and addictive disorders 
is generally underestimated, but the magnitude of the problem is 
expressed in the ``1997 Update on Progress in Brain Research'' 
published by the Dana Alliance. When one considers the toll in medical 
morbidity and mortality, lost productivity, along with the costs of law 
enforcement and treatment, the aggregate burden of severe mental 
illness in our society exceed $300 billion annually. These illnesses 
and their associated costs include:

                        [In billions of dollars]

Depression/manic depressive illness...............................    30
Schizophrenia.....................................................    30
Drug addiction....................................................   160
Alcoholism........................................................   100

    However, thanks to the research advances of the last two decades, 
we now know that severe mental illness and addictive disorders are not 
a consequence of inadequate parenting, lack of will power, poor self-
control, or moral failure. They are diseases of the brain whose 
development is influenced by a host of genetic biological and 
psychological factors that are just beginning to be understood. More 
importantly, we now know these disorders are treatable and that the 
results of treatment are equal, if not better than, in patients with 
illnesses like heart disease or diabetes. The personal and societal 
costs of mental illness and addictive disorders are high, but advances 
in research and treatment will help save lives, strengthen families, 
and save taxpayer dollars.
NIMH Research and Mental Illness
    In the past five decades, research supported by the National 
Institute of Mental Health has defined the core symptoms of the severe 
mental illnesses, including schizophrenia, manic depressive illness, 
and major depression. Research has shown that these and other mental 
illnesses involve specific brain dysfunctions and research has 
contributed directly to developing an array of effective treatments, 
including both medications and specific psychotherapies. The 
development of new major classes of psychotropic drugs--antipsychotics, 
antidepressants (including lithium), and anti-anxiety medications--have 
profoundly altered the lives of mentally ill people. Through long-term 
treatment with appropriate medications, many patients now can 
effectively control their illnesses and lead stable, essentially normal 
lives. In addition, the discovery that psychotropic medications are 
effective provided proof that mental illnesses are biologically based--
not a consequence of moral failure--and greatly lessened the stigma 
associated with these conditions.
    NIMH research has contributed significantly to the discovery, 
development, improvement and clinical use of psychotherapeutic drugs. 
The knowledge developed through this research has, in turn, provided a 
greater understanding of the causes of mental illness. Collaboration 
between NIMH researchers and the pharmaceutical industry often resulted 
in a discovery that a drug developed by industry for another use had 
unsuspected efficacy against a mental disorder. For example, a drug 
developed in the 1950's as an antihistamine (chlorpromazine) was found 
to be the first effective antipsychotic; another compound synthesized, 
but not used, by a drug company was found to be valuable as an 
antidepressant (imipramine). Such early discoveries by psychiatric 
researchers stimulated the pharmaceutical industry to search for other 
psychotherapeutic drugs.
    One of the many NIMH ``success stories'' involving medications 
development is the development of Lithium treatment. Lithium has freed 
many individuals with manic-depressive illness from months or years of 
hospitalization. Before the introduction of lithium, people with manic 
depressive illness experienced severe disruptions of their lives and 
marked losses of productive capacity. They, in many cases committed 
suicide. Although many people with this illness remain untreated today, 
those patients treated with lithium usually respond well and live 
greatly improved lives. And the benefits to society have been enormous. 
For example, lithium therapy has saved the U.S. economy more than $145 
billion since 1970. NIMH clinical research played a large role in 
establishing the effectiveness and treatment conditions for lithium 
therapy; this role was particularly important because lithium is an 
inexpensive, non-patentable medication--hence not commercially 
attractive.
    This example and other NIMH sponsored research make major 
differences in the lives of thousands of Americans and their families. 
Kathleen who suffered from schizophrenia explains ``Today I am happy to 
be alive. Taking a new anti-psychotic drug [olanzapine] has changed my 
life and my attitude.'' NIMH researchers helped build the groundwork 
for development of this new generation of atypical anti-psychotic 
medications, including olanzapine.
    Kathleen says ``the fifteen years before I found this medication 
were not easy,'' At age 31 Kathleen started to have schizophrenic 
episodes. ``My husband divorced me . . . my children became ashamed of 
me,'' Kathleen explains, ``I lost my family, my home and nearly my 
life.''
    In 1993, Kathleen started taking a new medication called 
olanzapine. She no longer suffers from symptoms of schizophrenia. Her 
family is together again and proud of her recovery. ``I am ever so 
thankful for my success in overcoming my mental illness with this 
drug.'' (Quotation Courtesy of National Mental Health Association).
    But much more needs to be done. APA particularly supports NIMH's 
commitment to expand scientific knowledge and research on mental 
illness among our children. An estimated 20 percent of American youth, 
11 million in all, have serious emotional or behavioral disorders and 
an estimated two-thirds of all youth are not receiving the mental 
health treatment they need. The effects of these illnesses on the lives 
of our children and their families are enormous. Children with 
untreated cognitive or emotional disorders cannot learn adequately or 
benefit from the kind of peer and family relationships essential to 
becoming a healthy and productive adult. These children are also at 
increased risk of alcohol and drug abuse, criminal behavior, and 
suicide. We urge continued support for the child health initiatives 
currently underway at the NIMH.
NIDA: Drug Addiction Research
    Drug addiction is one of the most serious public health problems 
that our Nation faces. Drug addiction takes a tremendous toll on both 
the individual and on society as a whole. Not only are the economic 
costs associated with drug use staggering, but illicit drug use is 
inextricably linked to the spread of infectious diseases like AIDS, 
hepatitis, and tuberculosis, and is also associated with family 
violence, child abuse, violent crimes and suicide.
    As we move into the 21st century, ever changing drug use patterns, 
the continuing transmission of HIV infection among drug abusers, and 
the need to develop effective treatment and prevention interventions 
underscore the importance of research in finding new and better ways to 
alleviate the pain and devastation of addiction. Because drug addiction 
is such an enormous and complex problem, the National Institute on Drug 
Abuse (NIDA) has a broad research portfolio that addresses the most 
fundamental questions about drug abuse, ranging from the molecule to 
managed care and from DNA research to community outreach.
    Besides a better understanding of addiction, we now have the 
research to show in detail what drugs are actually doing to, and in, 
the brain. Scientists have identified and cloned receptors in the brain 
for every major drug of abuse. Researchers have discovered not only the 
specific brain circuits involved in drug experiences, but are starting 
to uncover the changes in activity patterns in these brain circuits 
over time, during the processes of addiction and during drug 
withdrawal. Research also shows that addiction occurs as a result of 
the prolonged effects of abusable drugs on the brain. In fact, just a 
few weeks ago NIDA-supported researchers found a critical link between 
nicotine addiction and the feeling of pleasure nicotine use can 
produce. This discovery brings researchers closer to the development of 
an effective treatment for nicotine addiction including the possible 
development of anti-nicotine medications targeting this site in the 
brain.
    APA strongly supports NIDA's strong research effort to combat drug 
abuse among children and adolescents. NIDA's efforts focus on the 
prevention of initial drug use and prevention of the health 
consequences of drug abuse for the individual, his/her children, and 
society. As part of this effort NIDA will support basic cognitive and 
behavioral research on processes like behavior change to better inform 
prevention approaches. Specifically, NIDA will enhance its efforts to 
look at the role of risk and protective factors including peer pressure 
in increasing or decreasing the probability that a child will become 
addicted to drugs. Other critical NIDA work in this area includes a 
study of children exposed to drugs prenatally in order to clarify the 
long term effects of such exposure, and a study of the differential 
effects of drugs on the brain and behavior of children at different 
ages.
NIAAA: Research on Alcohol Abuse and Alcoholism
    As a substance that is both legal and culturally accepted in our 
society, the health, behavioral, and social problems that are 
associated with misuse of alcohol are markedly different from those 
associated with illicit drugs. Alcohol dependence, characterized by 
chronic and heavy drinking, produces such medical consequences as liver 
disease and pancreatitis and contributes to cardiovascular disorders, 
certain cancers, immune, and endocrine system illness. Alcohol can also 
induce congenital defects, growth retardation, learning disabilities, 
and other disorders.
    One major NIAAA success is research which helped demonstrate the 
effectiveness of a new medication to treat alcoholism, naltrexone, 
which blocks both the craving for alcohol and the pleasure of getting 
high. Studies show that when combined with behavioral interventions 
naltrexone allows as many as 75 percent percent of those being treated 
to avoid relapse, compared with fewer than 50 percent of those who 
receive counseling alone.
    One mother who was an alcoholic reported that when taking 
naltrexone, ``I just didn't seem to have the desire to drink even 
though there were lots of stresses at the time. Ultimately, my self-
esteem improved, and I have not had a drink in over eight months. 
Because I wasn't drinking I had the courage and insight to make the 
changes that I needed to . . . Life is 100 times better now for my 
children and myself. I feel like my old self. As I look back, I'm so 
glad I [took the medication and started the counseling] and my children 
are delighted.'' Indeed we can be very proud of the many thousands of 
individuals whose lives have been transformed, if not saved, by NIAAA-
funded research.
    The American Psychiatric Association strongly supports the high 
priority NIAAA places on researching genetics of alcoholism. Research 
has shown that a significant portion of the susceptibility of 
alcoholism is inherited. Investigators sponsored by the National 
Institute on Alcohol Abuse and Alcoholism are searching the entire 
human genome for genetic markers which are linked with alcoholism. In 
the process of this search, they will be able to test rigorously the 
involvement of a number of genes hypothesized to contribute to the 
susceptibility to alcoholism and perhaps discover contributions from 
other genes not yet suspected of involvement with alcoholism. Further 
research is critical to identify the genes located within certain 
specific chromosomal locations.
    The APA proposes that the research budgets for the NIMH, NIDA, and 
NIAAA be increased to a level minimally appropriate to the quality of 
the science which merits support, as follows: $970 million (20 percent) 
for NIMH; $658 million (25 percent) for NIDA; and $262 million (15 
percent) for NIAAA. These recommendations include critical research 
training and research management and support activities, as well as 
support for AIDS research. These recommendations are based upon expert 
analysis of the scientific opportunities which could be capitalized on 
at each Institute to ensure further research breakthroughs in mental 
illness and addictive disorders.
SAMHSA and CMHS Treatment for Mental Illness
    As we all know, all the medical knowledge in the world will not 
help unless patients who are ill receive medically appropriate 
treatment. APA recognizes the great importance of the work of the 
Substance Abuse and Mental Health Services Administration (SAMHSA) and 
calls for an increase for SAMHSA significantly above that proposed by 
the President. Mental health services programs are now administered by 
the Center for Mental Health Services (CMHS) at SAMHSA. Congress has 
called on CMHS for a vigorous federal leadership role in mental health 
services delivery and policy development. In some states, SAMHSA-funded 
services constitute up to 39 percent of all non-institutional mental 
health services.
    The Committee has made known its interest in changing the current 
Community Mental Health Block Grant into Performance Partnerships. The 
Association supports this and wants to recognize the efforts of the 
Substance Abuse and Mental Health Service Administration (SAMHSA) to 
move toward a more flexible but accountable system of federal support 
for community mental health services. Critical to this effort, though, 
are funds to help states to develop an infrastructure for collecting, 
analyzing and reporting on performance data. As the key priority for 
SAMHSA, we urge the Subcommittee to consider $30 million to help states 
develop the capacity they need for implementation of such a system.
    We also present for your consideration the following funding 
recommendations:
    One of the most successful programs at CMHS is the Children's 
Mental Health Services Program. As you know, the program authorizes 
grants to states and communities to stimulate the development of 
interagency systems of care for children and adolescents with mental, 
emotional or behavioral disorders. The philosophy of the program is 
child-centered, with requirements for individualized services 
(sometimes known as wrap-around services), and on services which 
support families to care for very sick youngsters at home. We recommend 
a funding level of $87 million.
    $79.9 million for the Knowledge Development and Application Program 
at the SAMHSA Center for Mental Health Services. Rather than directly 
providing services to beneficiaries, the KDA program is designed to: 
emphasize information dissemination; develop new and innovative 
approaches to service delivery, training and technical assistance; and 
assess the cost-effectiveness of model services. These functions are 
performed with an emphasis on under served populations, such as 
children, adults with severe mental illness, ethnic minority 
populations, rural populations, and the elderly. This role will take on 
critical importance as states move vulnerable populations of people 
with severe mental illness into managed care arrangements.
    $355.4 million for the Community Mental Health Block Grant program 
states are allowed to utilize block grant dollars for a range of 
critical services for people with serious mental illnesses including 
community-based treatment, case management, homeless outreach, juvenile 
services and rural mental health services. The demand for community 
based mental health services has dramatically increased in recent 
years. To help remedy this distressing situation the block grant 
program should receive a significant increase particularly since, when 
inflation is taken into account, the program's funding has declined by 
$56 million since fiscal year 1993.
    APA also recommends $33 million for the PATH Homeless State Grant 
Program; $30 million for Protection and Advocacy; and $20 million for 
Direct Operations.
    The APA applauds the subcommittee's leadership in funding support 
for research and treatment of mental illness and addictive disorders. 
These are dollars well invested which have proven to translate the 
promise of scientific discovery by NIMH, NIDA, and NIAAA into saving 
and improving the lives of millions of Americans. We will also be 
submitting to the subcommittee separately, a more detailed list of 
recommended research priorities for mental illness, drug abuse, and 
alcoholism research at NIH. Thank you for the opportunity to submit 
this statement for the record.
                                 ______
                                 
Prepared Statement of the Council of State Administrators of Vocational 
                             Rehabilitation
    The Council of State Administrators of Vocational Rehabilitation 
(CSAVR) is comprised of the chief administrators of the public agencies 
providing rehabilitation services to persons with disabilities in the 
50 States, the District of Columbia, and the territories.
    These Agencies constitute the State partners in the State-Federal 
Program of Rehabilitation Services for persons with mental and/or 
physical disabilities, as authorized by the Rehabilitation Act of 1973, 
Public Law 93-112, as amended.
    While the Rehabilitation Act is the cornerstone of our Nation's 
commitment to assisting eligible people with disabilities to obtain 
competitive employment and to live independent and productive lives, it 
is severely underfunded.
    When one considers that a Louis Harris and Associates study 
estimates that two out of every three adults with a disability are 
unemployed, and that the Rehabilitation Program has the resources to 
provide services to only one in twenty eligible people, this 
underfunding constitutes an unacceptable tragedy for the millions of 
people with disabilities who need services in order to become employed, 
yet are unable to receive them.
    The great responsibility placed upon the Rehabilitation Program 
became even more acute, with the passage and implementation of the 
``Americans with Disabilities Act'' (ADA). The ADA vastly expands 
opportunities for all Americans with disabilities. It is vital 
therefore that the Rehabilitation Program assist people with 
disabilities to fully realize the promise of this landmark legislation.

Vocational rehabilitation services: basic State grants

                        [In billions of dollars]

Fiscal year 1999 CSAVR recommendation.............................     3
Fiscal year 1998 authorization...................................( \1\ )

\1\ Such sums.

    Basic State Service Grants are the lifeblood of the Vocational 
Rehabilitation Program, financing the provision of vocational 
rehabilitation services to eligible individuals with mental and 
physical disabilities for placement in competitive employment.
    These Federal dollars, matched with state monies, permit State 
Rehabilitation Agencies to provide, or to contract with private 
organizations and agencies to provide individualized, comprehensive 
services to eligible persons with mental and/or physical disabilities, 
for the purpose of rendering these individuals employed and 
independent.
    Such services may include evaluation; comprehensive diagnostic 
services; counseling; physical restoration; rehabilitation engineering; 
the provision of various kinds of training and training supplies, tools 
and equipment; prosthetic devices; placement; transportation; post-
employment services; and ``any other service'' necessary to 
rehabilitate an individual into employment.
    For fiscal year 1996, the latest year for which the Federal 
Government has statistics, the Rehabilitation Services Administration 
advises that the $2,118,834,000 appropriated for Basic State Vocational 
Rehabilitation provided services designed to lead to gainful employment 
for 1,483,073 people with disabilities of which 69.3 percent were 
severely disabled. Of this number, 184,030 were placed in competitive 
employment.
    Despite this expenditure, there still are not sufficient funds to 
serve all those eligible, disabled people who have the potential and 
desire to work and who need rehabilitation and training services to 
obtain employment and self-sufficiency.
    In carrying out the Congressional mandate to give priority of 
service to the rehabilitation of individuals who are severely disabled, 
State Agencies have found that the costs--in time, effort, and money 
for services--are much greater than the cost of rehabilitating people 
less severely disabled.
    At the same time, it is alarming to note that the purchasing power 
of the resources available has remained virtually stagnant since 1980.
    With these statistics in mind, the Council strongly urges that the 
Congress assist us in facing this challenge by providing Federal 
appropriations for Basic State Vocational Rehabilitation Services in 
the amount of $3,000,000,000 for fiscal year 1999, an increase of 
$753,112,000 over the fiscal year 1998 appropriation. With this 
increase in resources, the CSAVR estimates that nearly 270,000 more 
persons will receive services and 92,500 more will be placed in 
competitive employment.
    The justification for higher funding levels stems from the purpose 
for which the money is spent--the prevention of an incalculable waste 
of human potential, a purpose on which no price tag can be placed.
    Over the decades, Vocational Rehabilitation has more than paid for 
itself by helping persons with disabilities become gainfully employed; 
increase their earning capacity; by freeing family members to work; 
and/or by decreasing the amount of welfare payments, health services, 
and social services they might need; as well as by assisting them to 
become taxpayers.
    Appropriating additional monies for Vocational Rehabilitation 
Services reduces the Federal Deficit. Indeed, the Congressional Budget 
Office has stated that ``a reduction of funds for rehabilitation * * * 
would generate increases in other parts of the federal and state 
budgets.'' Funds appropriated for Vocational Rehabilitation are a sound 
investment of the Public's money.
Other Programs Authorized by the Rehabilitation Act
    The Rehabilitation Act is recognized as the most complete and well-
balanced piece of legislation in the human services field. In addition 
to the Basic State Vocational Rehabilitation Services Program, the Act 
contains provisions for (1) an innovation and expansion program; (2) a 
training program; (3) a research program; (4) a comprehensive services 
for independent living program; (5) a supported employment program; 
and, among others, (6) special projects and demonstration efforts. The 
CSAVR strongly supports adequate funding for all Sections of the Act.
                                 ______
                                 
 Prepared Statement of the Helen Keller National Center for Deaf Blind 
                           Youths and Adults
                         preliminary statement
    The Helen Keller National Center (HKNC) is an unique national 
resource: It is the only entity in the world whose sole mission is to 
provide comprehensive training, independent living skills, and 
employment preparation to young people and adults who are both deaf and 
blind. Because of its unique mission HKNC must rely primarily on 
support through Federal funding. But HKNC has not received a funding 
increase above inflation for the past five years. This circumstance has 
resulted in severe constraints on HKNC's ability to cope with 
increasing demand for its services and at the same time keep its 
physical plant in adequate repair.
    On behalf of thousands of children, young people, and adults who 
are both deaf and blind, the Helen Keller National Center (HKNC) urges 
this Committee to recommend an appropriation for fiscal year 1999 at a 
level which will enable HKNC first and foremost to increase its 
capacity to provide technological training to deaf-blind individuals in 
order to enhance their employment opportunities; to address capital 
repair needs, and also to bring about the technological improvements 
and information gathering capability essential to reaching a higher 
level of efficiency and effectiveness. An appropriation of $8.55 
million would reasonably address HKNC's requirements in the next fiscal 
year.
    The Helen Keller National Center is very pleased and deeply 
grateful that the Department of Education requested, and the 
Administration agreed to, a substantial increase over the fiscal year 
1998 appropriation. The budget amount of $8.176 million includes a cost 
of living increase, and a one time infusion of funds for urgent capital 
repairs and equipment and training in computer and other technology for 
our deaf-blind students.
    While we appreciate the first real funding increase in 5 years, 
there are three areas (representing increases over the President's 
budget in the amount of $375,000), which we urge this Committee to 
recommend in its fiscal year 1999 appropriation bill for the 
Departments of Labor, Health and Human Services, and Education. The 
specific requirements for the amount over the President's budget are 
$100,000 to establish a national registry of deaf-blind individuals; 
$100,000 for the Center's endowment fund; and $175,000 for followup 
services for those deaf-blind youths and adults who have completed 
training. The total amount we are asking for--$8.55 million--is very 
small in Federal budgetary terms, but it will enable hundreds of deaf-
blind Americans to live independently, including employment in 
productive jobs.
    Deaf-blindness is by any measure one of the most devastating and 
most severe of disabilities. The number of deaf-blind Americans is 
increasing substantially on both ends of the age spectrum: Among 
children, and also in the elderly population. The reduction of 
dependency and the huge cost burden such dependency requires, results 
in a human and financial benefit that is incalculably greater than the 
funding we request. This modest appropriation would save many times 
that amount in Federal, State, and local funds.
                               background
    The Helen Keller National Center is established by Federal statute 
and is funded primarily through Federal appropriations, and secondarily 
through State agency fee payments and corporate and individual 
donations. Its mission and its services are unique in the Nation and in 
the world: HKNC provides diagnostic evaluation, comprehensive 
rehabilitation, training, job preparation, and placement services for 
individuals who are both deaf and blind. HKNC also conducts research, 
and provides a national program of technical assistance and training to 
States and service agencies. From its headquarters in Sands Point, Long 
Island, New York, the Helen Keller National Center administers a 
national network of 42 affiliate agencies, under which agencies are 
provided financial support and technical assistance by HKNC to serve 
deaf-blind children, youth, and adults in their own home States.
               congressionally mandated responsibilities
    The mission and responsibilities of the Helen Keller National 
Center, established by Congress in 1967, have expanded over the years. 
In 1992 the Helen Keller National Center Act was extended and amended. 
Additional responsibilities--and additional costs--were imposed on 
HKNC. For example, the Center is now required to train family members 
of individuals who are deaf-blind. The definition of deaf-blindness was 
expanded in the 1992 amendments. The result has been the opening up of 
the rehabilitation system to serving additional deaf-blind clients.
    This year, we are seeking a further amendment to the Act which 
would enable HKNC to establish and maintain a national registry of 
deaf-blind individuals. The Rehabilitation Act reauthorization bill 
(S.1579) introduced and ordered reported by the Senate Labor and Human 
Resources Committee includes a section authorizing the registry, along 
with specific funding authority. Although this provision is not yet 
law, we urge this Committee to recommend an appropriation in an amount 
sufficient to enable HKNC to initiate this vitally important project.
    Congress also created an endowment fund for HKNC, providing for a 
federal match of money from sources other than federal appropriations. 
The endowment, if it were funded, could help defray some of the 
appropriation burden. Apart from regular and preventive maintenance, 
HKNC's physical plant has not been refurbished since its inception 
nearly a quarter century ago. It is imperative that sufficient funds be 
provided to correct the most urgent deterioration, and to bring the 
HKNC residential campus into conformity with Americans with 
Disabilities Act standards for accessibility. Over the past five years 
Congress has appropriated funds for HKNC in the amounts requested in 
the President's budget; unfortunately, however, these amounts barely 
have been sufficient to offset the costs of inflation, and certainly 
have not been enough to expand needed services or repair our 
facilities.
    specific requirements for capital repair and program improvement
    HKNC requests this Committee's assistance in its efforts to 
maintain and strengthen its capacity to serve deaf-blind youths and 
adults, to repair its deteriorating physical plant, and to establish 
and maintain a national registry of deaf-blind people. We respectfully 
ask this Committee and the Congress to accord HKNC a high priority for 
federal support for the next fiscal year. Justification for the 
increase is set forth below:
    Capital repairs.--The residential, training, and administration 
facilities comprising the Helen Keller National Center are now 22 years 
old. Because of limited funding HKNC has not been able to make 
necessary capital repairs and improvements. The most urgent of these 
are (1) removal and replacement of existing underground fuel oil tanks 
to comply with Federal, State, and local environmental requirements; 
(2) installation of underground electrical feeder lines for emergency 
power; and (3) renovation of some building interiors for additional 
accessibility, and to ensure compliance with the Americans with 
Disabilities Act. The total estimate cost for these capital repairs is 
$500,000. The President's budget would provide approximately half the 
funding needed for this purpose.
    Increased service needs and the National Registry.--Three important 
factors have emerged to create additional pressures to expand HKNC's 
services. There are more than 11,000 deaf-blind children under the age 
of 22--the greatest number in our history--who will need such services. 
The definition of deaf-blindness in HKNC's enabling legislation was 
expanded to include those with progressive vision and/or hearing loss 
leading to deaf-blindness, as well as individuals who cannot be tested 
by traditional methods, but who are functioning as deaf-blind. The 
Rehabilitation Services Administration, Council of State Administrators 
of Vocational Rehabilitation, the American Association of the Deaf-
Blind, and HKNC, have entered into a cooperative agreement under which 
the parties agreed to a model state plan for deaf-blind services. This 
will result in a statewide approach to serving people who are deaf-
blind.
    If these developments are to have any value or utility, HKNC must 
establish and maintain a national registry to ensure that all deaf-
blind Americans receive the services they need. Creation of a national 
registry of deaf-blind children, youths, and adults by HKNC has been 
approved by the Rehabilitation Services Administration. Although it is 
urgently needed, however, HKNC has not had the financial resources to 
establish and maintain the nationwide listing. Establishment and 
initial operation of the registry will require an expenditure of 
$100,000. Lesser annual amounts would be necessary to acquire the data 
to maintain the registry in future years. The President's budget does 
not include any funds for the registry.
    Endowment fund.--The endowment authorized by the 1992 amendments to 
the Helen Keller National Center Act has not yet been initiated, 
because the Federal funds required to trigger its establishment have 
not been appropriated. Funding for the endowment would enable HKNC to 
reduce gradually its dependence upon Federal appropriations. HKNC is 
now in a better position to attract outside funding, and those efforts 
would benefit greatly from even a small endowment. The President's 
budget does not include funds for this purpose. We urge the Committee 
to include a modest amount--$100,000--in the fiscal year 1999 
appropriation.
    Technology training.--Within the amount we request, HKNC would 
apply $250,000 of the appropriation toward the establishment of a 
``state of the art'' technology capability, including the purchase of 
computers and technology equipment, and providing the following 
benefits to its deaf-blind clients, enhancing their job skills and 
marketability:
    (1) Skill development, including classroom learning and on-the-job 
use of current computer hardware and software;
    (2) Training for professionals (including rehabilitation counselors 
and independent living teachers), utilizing the HKNC Training Team, in 
teaching computer skills to deaf-blind clients; and
    (3) Increasing knowledge and awareness on the part of deaf-blind 
consumers about available technology and its potential value in 
employment and home settings. The President's budget includes support 
at the amount HKNC requests, and we respectfully ask the Committee to 
provide these funds.
    Followup services.--The Helen Keller National Center has found 
that, all too often, after intensive, comprehensive, one-on-one 
training is provided to a deaf-blind youngster, upon returning home the 
individual does not have the support structure necessary to retain the 
skills for independence and employment. With followup services provided 
by specialized HKNC training teams, the training the deaf-blind 
individual received can be reinforced, and the likelihood of permanent 
stability, independence, and a steady job, will be enhanced. As part of 
its request, HKNC urges the Committee to provide $175,000 for this 
purpose for fiscal year 1999.
    Other issues.--Although HKNC's funding request for fiscal year 1999 
is limited to addressing the foregoing urgent needs, the Committee 
should be aware of some additional requirements for which funds would 
be effectively used, should the Congress be in a position to provide 
them:
    Affiliate network.--HKNC's network of 42 State and local affiliate 
agencies is extremely cost-effective, and should be expanded to enable 
400 additional deaf-blind clients to be served through at least two new 
affiliate programs.
    Family training.--Providing training and support to families is 
extremely effective in enabling them to acquire necessary services for 
the deaf-blind family member. Since the family often must serve as case 
manager, advocate, and primary care provider, such training eliminates 
the cost of supporting habilitation and rehabilitation positions in 
state agencies. Currently HKNC supports parent organizations in 28 
States and Puerto Rico, and provides a vital communications link to 
about 2,000 parents. Parent training, transportation, and coordination 
have had to be deferred because of a lack of funds.
    The aging population.--With the graying of America, the number of 
adults 55 and older with age-related hearing loss and blindness is 
increasing rapidly. This population increasingly requires services to 
maintain independence--services provided through the Helen Keller 
National Center. The ballooning caseload is imposing a tremendous 
burden, both on the rehabilitation system and on HKNC.
                               conclusion
    Deaf-blindness is one of the most severe of all disabilities. Most 
of us cannot conceive of living and functioning in a world without 
either sight or hearing. Training for independence, and even 
employment, for people who are deaf-blind, is not only possible but is 
being accomplished, successfully, every day at HKNC. Such 
rehabilitation and training is extraordinarily difficult, time 
consuming, and labor-intensive.
    For a quarter century the Helen Keller National Center has operated 
as the only organization in the United States which provides, directly 
and indirectly, throughout the country, a comprehensive program of 
services and training for this relatively small population of our 
disabled citizens, and it does so with very modest funding from this 
Committee and the Congress. With the burgeoning population of deaf-
blind children and older Americans, with the aging of its physical 
plant, and with more requirements it is becoming increasingly difficult 
for HKNC to adequately serve those who need our services.
    We respectfully, but urgently, request this Committee to continue 
its recognition of, and support for, the needs of children and youth 
with the most severe combination of disabilities, and their families. 
We ask that Congress preserve the Nation's modest but essential 
investment in the Center and the people it serves by appropriating 
$8.55 million for the Helen Keller National Center for fiscal year 
1999.
                                 ______
                                 
 Prepared Statement of the American Lung Association and the American 
                            Thoracic Society
    The American Lung Association and its medical section, the American 
Thoracic Society, appreciate the opportunity to comment on the Senate 
Labor, Health and Human Services and Education Appropriation 
legislation for fiscal year 1999.
    We first would like to thank the Committee for its continued 
support for biomedical research and public health programs. Without the 
Committee's leadership and strong bipartisan support many of the recent 
research and public health advances would not have been possible. For 
the Committee's support, we are deeply grateful.
    We are also grateful for the support and leadership that the 
National Heart, Lung, and Blood Institute has provided over the past 50 
years. As you may know, the NHLBI is celebrating its 50th anniversary. 
In those 50 years, the advances in research and public health have been 
phenomenal. In the 1940s, children with asthma sat on the sidelines 
while other children played sports. Today, athletes within asthma win 
Olympic gold medals. In the 1950s, premature babies with respiratory 
distress syndrome (RDS) died with hours of delivery. Today, not only 
can doctors successfully treat RDS babies, in many cases they can 
prevent RDS with drug treatments in the pregnant mother. In each of 
these advances, NHLBI was leading the way. Truly the 50th anniversary 
of NHLBI is a cause for celebration.
    Although our comments will focus on lung-related research, the 
American Lung Association and American Thoracic Society feel that 
research into all health conditions is a valuable investment. We also 
recognize that biomedical and behavioral research are only part of a 
continuum of public health endeavors that include health services 
research, targeted health care delivery, health professions training, 
and prevention activities. We encourage this Committee to support the 
entire public health community.
    There has been a great deal of excitement and anticipation about 
windfall revenues from the budget surplus and the proposed tobacco 
deal. Plans have been made by the Administration and leaders in 
Congress based on expected tobacco deal revenues. We strongly urge 
Congress and the Administration to make funding decisions based on the 
regular appropriations process. Enactment of the proposed tobacco deal 
is neither eminent nor necessarily in the best interest of America.

                    Summary: Funding recommendations

                        [In millions of dollars]

National Institutes of Health.................................  15,696.0
    National Heart, Lung, and Blood Institute.................   1,825.7
    National Institute of Allergy and Infectious Diseases.....   1,554.4
    National Institute for Environmental Health Sciences......     379.6
    National Institute of Nursing Research....................      73.1
Centers for Disease Control and Prevention....................   2,800.0
    National Institute for Occupational Safety and Health.....     208.8
    Tuberculosis Control Programs.............................     220.0
    Office on Smoking and Health..............................      70.0
Magnitude of Lung Disease
    Every year 335,000 Americans die of lung disease. Lung disease is 
third leading cause of death in the U.S., responsible for one in every 
seven deaths. More than 30 million Americans suffer from a chronic lung 
disease. Lung diseases cost the U.S. economy an estimated $85 billion 
annually.
    Lung diseases represent a spectrum of chronic and acute conditions 
that interfere with the lungs ability to extract oxygen from the 
atmosphere, protect against environmental or biological challenges and 
regulate a number of metabolic processes. Lung diseases include; 
chronic obstructive pulmonary disease, lung cancers, tuberculosis, 
pneumonia, influenza, sleep disordered breathing, pediatric lung 
disorders, occupational lung disease, sarcoidosis, and a problem of 
growing concern in the U.S.--asthma.
Asthma
    Asthma is a chronic lung disease where the bronchial tubes of the 
lungs become swollen and constrict, preventing air from getting into or 
out of the lung. These obstructive spasms of the bronchi are caused by 
a broad range of environmental triggers that vary from one asthma 
sufferer to another.
    Asthma is on the rise. An estimated 14.6 million Americans have 
asthma; 4.8 million are under the age of 18. Since 1984, the prevalence 
of pediatric asthma has risen 72 percent. Rates are increasing for all 
ethnic groups and especially for African American and Hispanic 
children. While some children appear to ``out grow'' their asthma when 
they reach adulthood, most, 75 percent will require life-long treatment 
and monitoring of their asthma condition.
    Asthma is expensive. The growth in the prevalence of asthma will 
have significant impact on our nation's health expenditures, especially 
Medicaid. Currently, asthma costs the U.S. over $12 billion a year. 
Asthma attacks bring 1.6 million people to the emergency room each 
year. According to recent studies, asthma accounts for 17 percent of 
all pediatric emergency room visits.
Asthma kills
    In 1994 5,487 children died as a result of an asthma attack. That 
is a 6 percent increase from 1993 and over a 100 percent increase from 
1979. A disproportionate share of these death were in African American 
families. In 1994, the age-adjusted death rate for blacks was three 
times high than that of whites.
Asthma Research Advances
    The good news on asthma is that research is beginning to bring 
answers, and with answers come hope for new treatments and a cure. NIH-
supported research has provided greater understanding of what is 
actually going wrong in a person suffering from asthma; why exposure to 
airborne substances cause bronchial inflammation, why the immune system 
hyper-responds and what kinds of cell-to-cell communication mediate 
this response. Even more promising is that NIH-sponsored researchers 
are beginning to establish linkages between candidate genes and asthma. 
In the near future, we expect that this research will identify the 
genes that cause asthma.
    Researchers are also developing better ways to treat and manage 
chronic asthma. NHLBI-supported research has shown that regularly 
scheduled use of beta-agonists, though safe, provides no additional 
benefit over their use only as needed in patients with mild asthma. 
Based on this research, patients with mild asthma need not take 
regularly scheduled doses of a beta-agonist. Because over half of all 
asthma patients have mild asthma, this finding is expected to result in 
large reductions in the cost of asthma care.
    Researchers supported by NHLBI have developed better animal models 
to allow expression of selected asthmatic genetic traits. This will 
allow researchers to develop a greater understanding of how genes and 
environmental triggers influence the onset, severity and long-term 
consequences.
    Population-based research is also leading to improvements in the 
management of asthma. NIAID's National Cooperative Inner-City Asthma 
Study is designed to identify and mediate those factors in the 
patient's home that lead to increased morbidity and mortality in the 
inner-city minority population. Data from NIAID's Inner-City Asthma 
Study show that by combining medical treatment and asthma case 
management with a reduced exposure to these triggers can lead to a 
significant reduction in hospital costs for study populations.
    NIEHS-supported research is providing greater insight on the 
potential interactive and independent effects that exposure to 
areoallergens, like ozone and fungal molds, have on asthma symptoms.
    NINR-supported research has shown a correlation between biological 
markers of airway inflammation and symptoms in adults with asthma. 
Further NINR studies are investigating whether Asthma Education 
Intervention impacts both clinical markers of asthma and biological 
marker of airway inflammation.
Research advances and opportunities
    NHLBI funded researchers have localized the gene defect that causes 
primary pulmonary hypertension (PPH)--a rare disease that kills nearly 
half of its victims within four years. While inherited PPH is uncommon, 
PPH due to interaction with drugs and other diseases is far more 
common. Understanding the mechanism of inherited PPH will lead to 
better treatments to prevent PPH or stop its fatal outcome.
    Eighty to 90 percent of all chronic obstructive pulmonary disease 
(COPD), which includes emphysema and chronic bronchitis, is caused by 
smoking. However, only 15 percent of smokers develop COPD. Non-smoker 
also can develop COPD. These facts taken together strongly suggest a 
genetic link in the development of COPD. With appropriate resources, 
NHLBI researchers can develop a greater understanding of the genetic 
component of COPD and how genetics interact with other components like 
smoking, environmental exposures, diet and exercise.
    NHLBI-supported researchers have found that retinoic acid can 
reverse the effects of emphysema in laboratory rats. Further research 
is needed to explore the role retinoic acid plays in lung tissue 
rejuvenation. Such research may lead to better treatment for emphysema 
and other degenerative lung diseases.
    Scientists supported by NHLBI have discovered a new family of 
chemical in the lung--beta-defensins--that kill disease-causing 
bacteria. Other researchers have begun to describe the role surfactant 
proteins play in the lung defense. A fuller understanding of the role 
these natural chemical play in the lung's immune system may greatly 
improve treatment for a number of diseases--ranging from cystic 
fibrosis to prevention of lung-related infection in AIDS patients.
    Vaccine researchers supported by NIAID have developed a pediatric 
acellular pertussis vaccine for ``whooping cough'' that is safer and 
more effective than the previous whole cell vaccine. Further research 
may soon yield an adult pertussis vaccine and a pediatric vaccine that 
requires a single dose, rather than the current multiple injections.
    Researchers at NINR are looking at end-of-life issues. Many 
terminally ill patients suffer from dyspnea--troubled breathing. 
Current treatment of dyspnea is often ineffective and cause side 
effects that diminish the ``quality of life'' of dying patients. NINR 
research well help finds better ways to care for those who are dying.
    Job-related illness and injuries cost the U.S. economy over $121 
billion year. With proper research, we believe many occupational 
illnesses are preventable. We would like to bring to your attention the 
National Occupational Research Agenda (NORA) at the National Institutes 
of Occupational Safety and Health (NIOSH) at CDC. In 1996, NIOSH 
convened a panel of experts from the scientific, labor and corporate 
communities to layout a plan for occupational health research. The goal 
of this research plan is to collect sound scientific data to document 
and develop strategies to prevent job-related illness. We strongly 
recommend the committee provide $15 million to support the National 
Occupational Research Agenda at NOISH.
Responding to crisis
    The public health community watch with great interest and more than 
a little bit of anxiety, the recent a outbreak of avian flu in Hong 
Kong. The threat of a new viral pathogen poses to an unprotected human 
population is sincere and severe.
    The response of CDC and NIAID to this crisis was swift and 
decisive. Both CDC and NIAID sent experts to Hong Kong. NIAID also sent 
reagents and assisted in typing the avian flu virus. A potential 
vaccine was developed. Additionally, a tour of South China was 
organized to see if there were other cases of avian flu in humans. No 
cases outside of Hong Kong have been documented. So far, it appears as 
though a public health crisis has been avoided, thanks in part to 
expertise and materials contributed by CDC and NIAID. It is important 
to ensure we maintain the ability to respond to infectious disease 
threats around the globe, much like was done in Hong Kong.
RMS
    We are concerned that while the NIH research budget has increased, 
the administrative budget or research management and support (RMS) 
function has remained flat. Administrative functions of the NIH play a 
vital role in the advancement of science. Awarding and monitoring 
grants, ensuring scientific and ethical standards in the research 
community, developing and disseminating patient and provider education 
materials, and convening state of the art scientific meetings are just 
of few of the functions that NIH conducts with its administrative 
budget. If the administrative budget of NIH continues to shrink 
relative to other NIH activities, the eventual result will be a 
reduction in the quality of NIH-supported science.
Education
    Closely linked to the research management and support (RMS) budget 
issue is the funding for NIH Public and Professional Education 
Programs. NIH education programs are vital for improving patient care 
and education. The NHLBI has been a leader in producing patient and 
provider education materials. The NHLBI initiated the National Asthma 
Education and Prevention Program (NAEPP) in 1989 to raise awareness 
that asthma is a serious chronic disease and to promote more effective 
management of asthma through patient and professional education. NAEPP 
at NHLBI recently revised the Guidelines for the Diagnosis and 
Treatment of Asthma and has also published Asthma Management in 
Minority Children to provide information to health care providers 
serving minority children with asthma. We are pleased that the 
Committee included report language in last year's appropriation bill to 
exempt these kinds of important educational activities from 
restrictions on the RMS budget. We encourage you to continue this 
exemption.
Critical care medicine
    Critical care medicine is a multi-disciplinary treatment approach 
that involves such specialities as anesthesiology, internal medicine, 
pediatrics and surgery and is usually practiced in the hospital 
intensive care unit (ICU). Noting that critical care medicine accounted 
for 28 percent of total acute care hospital costs, in 1993 this 
committee directed the NHLBI to support research to enhance effective 
practices and treatments in critical care medicine. In 1994 the NHLBI 
Task Force on Research in Cardiopulmonary Dysfunction and Critical Care 
Medicine released a report on critical care medicine, including 
recommendations on training and basic, clinical, and epidemiological 
research on critical care medicine. The American Lung Association and 
the American Thoracic Society urge the committee to continue its 
support for research in critical care medicine.
Tuberculosis research and control initiatives
    Although tuberculosis is a preventable and curable disease, it 
still persists as a public health problem in the United States. As a 
direct result of increased federal investment in TB control programs at 
CDC, TB case rates have begun declining nationally. However, TB cases 
continued to increase in some areas. Twenty of the 50 states and the 
District of Columbia reported either no change or an increase in TB 
cases. 1996 was marked by sporadic outbreaks of MDR-TB. Sporadic cases 
of ``Strain W,'' a deadly TB strain resistant to the best anti-TB 
drugs, originally reported in New York, New Jersey and Florida have now 
been found in South Carolina, North Carolina, Colorado, Ohio, 
Pennsylvania, Georgia, Nevada, California and Puerto Rico.
    Recent investment in TB control programs are beginning to pay off. 
National TB case rates have declined for 4 consecutive years. Although 
data is still preliminary, we expect that CDC will soon announce a 
fifth straight year of decline in domestic TB rates. This good news is 
a direct result of efforts by the CDC and public health officials. It 
is important to continue this area of support throughout the period it 
takes to control TB. Preventive Health Projects for Tuberculosis 
administered by CDC should be continued in fiscal year 1999 and funded 
at the recommended level of $220 million.
    There are several steps that should be taken to maintain the 
current decline in TB rates. The first step must be the expansion of 
existing prevention and control methods. Tuberculosis is successfully 
prevented and controlled by a variety of public health methods. The 
American Thoracic Society and the CDC revised a joint statement, The 
Control of Tuberculosis in the United States, that provides guidance 
for establishing tuberculosis control activity. It is intended for use 
by persons working in tuberculosis control programs and related 
programs in such sites as correctional facilities and homeless 
shelters.
    To combat TB in the U.S. and eliminate tuberculosis worldwide will 
require far more than just intensified and widespread use of existing 
prevention and control methods. Combating TB will also require the 
development of new drugs to treat MDR-TB. The last new drug developed 
to treat TB became available in 1972. Today, the fight against TB 
requires new diagnostic and prevention technologies, and the rapid 
transmission of newly developed technologies to the field.
    Progress is being made on TB. In fiscal year 1998, the Foreign 
Operations Appropriation Subcommittee provided USAID's with funds for 
international infectious disease control, including TB. USAID, NIH and 
CDC, have begun a cooperative dialogue to decide how best to use these 
international TB funds. We are pleased that the American Lung 
Association and the American Thoracic Society has been invited to 
participate in many of these discussions. To ensure appropriate 
coordination between U.S. domestic TB control, research, and 
international efforts we strongly encourage CDC, NIH and USAID to enter 
a formal interagency cooperative agreement regarding US TB control 
activities. We also recommend that USAID, in conjunction with CDC, NIH, 
the World Health Organization and volunteer and professional 
organizations like the American Lung Association and American Thoracic 
Society develop an international plan to eliminate TB.
    Federal support for tuberculosis research is concentrated within 
the National Institute for Allergy and Infectious Diseases. The overall 
support within this Institute for research specific to M. tuberculosis 
has increased from $323,000 in fiscal year 1979 to $37.6 million in 
fiscal year 1998. NIAID has developed an agenda to intensify 
tuberculosis research efforts including improvement of existing 
diagnostic tests which are not sensitive enough to detect TB reliably 
and early in individuals with HIV infection, development of an 
effective vaccine to protect those at risk of infection and 
identification of more effective treatments for those already infected.
    In conclusion, lung disease is a growing problem in the United 
States. It is America's number three killer, responsible for one in 
seven deaths. The lung disease death rate continues to climb while 
rates for America's first- and second-ranked causes of death--heart 
disease and cancer--are dropping. Overall, lung disease and breathing 
problems constitute the number one killer of babies under the age of 
one year. Worldwide, TB kills 3 million people each year, more people 
than any other single infectious agent. The level of support this 
committee approves for lung disease programs should reflect the urgency 
illustrated by these numbers.
    Thank you.
                                 ______
                                 
Prepared Statement of Terry-Jo Myers, Interstitial Cystitis Association
    Honorable Chairman and Members of the Committee: Thank you for 
giving me the opportunity to present written testimony. I would like to 
tell you about interstitial cystitis and ask for continued funding of 
research to find a cure for this painful, debilitating disease. My name 
is Terry-Jo Myers and I am a professional golfer completing my 13th 
year on the LPGA tour. I also have interstitial cystitis, or IC. While 
I appear healthy to anyone who meets me, that is because the effects of 
interstitial cystitis are not visible to others. I can, however, assure 
you that my work, my family and social life, and my pursuit of many 
dreams have all been dramatically affected by my experience with IC. 
Many of you may already know that my IC story has had a happy ending, 
for have been able to find relief.
    Interstitial cystitis is a chronic inflammatory bladder condition. 
Its cause is unknown and there is no uniformly reliable treatment. The 
symptoms, which can be severe and unrelenting, include urgency and 
frequency of urination--up to 60 or more times in 24 hours--and pain in 
the bladder which IC patients have described as burning, like 
``electric shocks,'' or like ``razor blades in the bladder.''
    I was diagnosed with IC shortly after I developed symptoms at the 
age of 21, and I was told that nothing could be done. Doctors said I 
would just have to live with the pain--a prescription that far too many 
IC patients still receive. Every step I took was painful, and for a 
tour player it was torture. Often I could not even bend down to line up 
a putt. I had to urinate about 50 times a day, including 10 to 20 times 
at night. I played in non-stop pain and had constant anxiety about 
being able to make it to the next bathroom.
    Because travel is especially difficult for many people with IC, I 
arrived at tournaments exhausted. While my fellow players were 
practicing, I was often forced to remain in the locker room.
    Saddest of all for me personally, IC affected my golf game. As a 
junior athlete, I won many tournaments. As a professional with IC, my 
performance was terribly hindered by the disease. Because LPGA rules 
prohibit players from leaving the course for any reason, I had to 
withdraw from tournaments in the middle of a round because I needed to 
go to the bathroom. In 1988, I won the Mayflower Classic, but I 
attribute much of that win to the fact that there were two rain delays 
that allowed me to go to the bathroom and keep playing.
    For the last three years, I have been able to complete a full 
schedule in relative comfort, and look forward to continuing to do so. 
I am very happy to report that last season I won the Los Angeles 
Women's Championship, as well as the Sara Lee Classic, finishing the 
year with a career high $313,000 in earnings. I attribute much of my 
success to the oral drug Elmiron, which was recently approved by the 
FDA for marketing. Unfortunately, Elmiron provides relief in only about 
one third of the IC sufferers who try it.
    For me, last year was a dream come true. My story appeared in 
newspapers and magazines all across the nation. I was featured in 
People magazine. I appeared on countless television talk shows to share 
my story of success. The most gratifying result of all this publicity, 
beyond my own sense of achievement, was the fact that the Interstitial 
Cystitis Association, the ICA, was able to reach out to more IC 
sufferers than ever before.
    In mid-December, I received the Heather Farr Award at the LPGA 1997 
Awards Luncheon. This award, voted on by Tour players, recognizes a 
player who demonstrates determination, dedication, and spirit through 
the game of golf. Heather Farr, who was a close friend of mine, died of 
breast cancer in 1993. As I told the New York Times, I never told 
Heather that I had IC, but watching her fight cancer helped me continue 
my fight against IC. She fought her battle in public, and she was never 
angry or bitter. I guess I just borrowed some of her strength. For that 
reason, this award is especially meaningful to me.
    As if that were not enough gratification for any athlete, earlier 
this month I received a letter from the Golf Writers Association of 
America indicating that I had been voted the Ben Hogan Award, presented 
annually to someone who has continued to be active in golf despite a 
physical handicap or serious illness. This beautiful bronze statuette 
of Ben Hogan has been awarded to such golf heroes as Ken Venturi, Lee 
Trevino and President Eisenhower! I will be attending the awards dinner 
in Augusta on the eve of The Masters Tournament in April.
    Although I am immensely grateful for my reclaimed success, there 
are many many others who have not been as fortunate. I have had IC for 
fourteen years. It has been only 6 years since I was able to find a 
doctor to help me. This doctor put me in touch with the ICA and 
motivated me to take steps to begin to cope with my illness. This 
doctor was also aware of Elmiron and made sure that I was able to take 
it as soon as the FDA approved its distribution here. Not all IC 
patients can say this. Many can't travel, work, or meet their family 
obligations. Many become financially destitute as they lose their 
health insurance coverage and try to keep up with their IC treatments. 
Some have their bladders removed, only to encounter a whole new array 
of medical problems. My success story is not one that all IC patients 
can claim.
    Because it is a comparatively rare disease that affects mostly 
women, and historically, urology and urological research have focused 
primarily on male urological problems, interstitial cystitis is a 
disease that continues to be ignored by many members of the medical 
community. It is serious and it can be costly. An epidemiological study 
sponsored by the Urban Institute found that an estimated 450,000 people 
in the U.S.--men and women both--may suffer from IC, with an economic 
impact as high as $1.7 billion per annum.
    Fortunately, there is hope. Thanks to previous Congressional 
funding, the NIDDK built the IC Database, an extensive pool of IC 
patient information collected at nine sites around the U.S., and stored 
and analyzed at the Pennsylvania State University, Hershey Medical 
Center. Researchers have already begun to publish reports analyzing 
data obtained from this study, with the expectation that the Database 
will provide clues as to how IC develops, how to diagnose and 
categorize patients, and how to treat the disease more effectively. In 
short, the Database has provided the first systematic long-term look at 
a large number of IC sufferers. Thanks to your support the IC Database 
is now moving into Phase 2, which will test and study new treatments 
for IC.
    The Interstitial Cystitis Association and all IC patients are so 
grateful to all Members of this Subcommittee, and in particular, to 
Chairman Spector and Senator Reid for their ongoing support of research 
on IC and other urological diseases. Without your help, we would be 
nowhere in our struggle. Because of your commitment, we are beginning 
to see some progress. In conclusion:
    To continue this research initiative, we request that the Committee 
provide additional funds to the Urology Program of the NIDDK in fiscal 
year 1999 to be used for expanding the cadre of investigators doing 
research on IC. These funds should be used to support further research 
specifically into IC. Proposals should be solicited through a series of 
Request for Applications (RFAs) for individual research grants and 
pilot studies which would look into: (1) new strategies for IC symptom 
relief; (2) epidemiology; (3) further understanding the basic science 
of IC. The Committee requests that the NIDDK prepare a report of 
ongoing research studies and areas for research solicitations, 
demonstrating where advances can be made in the effective treatment and 
prevention of IC.
    We still have far to go. Yet we are confident that with your help 
and with adequate, continued funding for IC research through the NIDDK, 
results will be no less than miraculous. As a victim of IC, I know what 
it is like to endure chronic, unrelenting pain. Please help us to end 
our suffering. Help us find a cure for interstitial cystitis. Thank 
you.
                                 ______
                                 
  Prepared Statement of Father William L. George, S.J., and Father T. 
Byron Collins, S.J., Special Assistants to the President of Georgetown 
                               University
    In the current fee-for-service Medicare program, 10 percent of 
Medicare patients use 70 percent of Medicare services. Therefore, any 
desire to optimize the quality of care delivery and improve the 
efficiency of service delivery for Medicare patients must begin by 
addressing the issues related to care delivery for this segment of high 
utilization Medicare patients. The health Care Financing Administration 
has begun an initiative to address the needs of Medicare fee-for-
service patients with chronic medical illness. In response to this need 
for increased cost-effective service delivery Congress authorized, in 
Section 4016 of Public Law 105-33, the implementation of nine Medicare 
Coordinated Care Demonstration Projects intended to: improve the 
quality of items and services provided to target individuals; and 
reduce expenditures under the medicare program under title XVIII of the 
Social Security Act (42 U.S.C. 1395 et seq.) for items and services 
provided to target individuals. (SEC. 4016 (a)(1))
    Among these programs is ``1 project within the District of Columbia 
which is operated by a nonprofit academic medical center that maintains 
a National Cancer Institute certified comprehensive cancer center'' 
(SEC. 4016 (b)(C). In response to Public Law 105-33, Georgetown 
University proposes to undertake a program combining clinical pathways 
and case management strategies to more effectively manage the care of 
these chronically ill patients. The goal is to improve quality of care 
and cost-effectiveness of service for the chronically ill.
    In order to attract program participants, $3 million dollars was 
appropriated to the Georgetown demonstration through District of 
Columbia Appropriations in Public Law 105-100. This $3 million will, 
for the most part, cover copayments and deductibles that would normally 
be paid by Medicare fee-for-service beneficiaries when they receive 
care. Coverage of these patient out-of-pocket expenses will encourage 
Medicare beneficiaries to participate in the program. Coverage of 
copayments and deductibles will be arranged, in part, with the help of 
religious ministers in the District of Columbia. It is essential that 
these funds be used for this purpose. These funds were appropriated by 
the District of Columbia Appropriations Subcommittee because of 
language contained within Public Law 105-33, SEC. 4016 (e)(1)(A)(ii):
  --Cancer hospital.--In the case of the project described in 
        subsection (b)(2)(C), amounts shall be available only as 
        provided in any Federal law making appropriations to the 
        District of Columbia.
    This language is misleading and is currently being amended in the 
form of a technical correction. The $3 million received from District 
of Columbia Appropriations in Public Law 105-100 was a one-time fund 
disbursement. In the future, funding for patient out-of-pocket costs 
must be received through other Federal sources.
    We request that future funding for planning and ancillary funds of 
the Georgetown University Medical Center Medicare Coordinated Care 
Demonstration Program be appropriated to The Department of Health and 
Human Services for distribution to Georgetown. In fiscal year 1999 we 
request a total of $5 million. This request consists of $3 million for 
previously explained coverage of copayments and deductibles as well as 
$2 million to cover administration and infrastructure costs necessary 
for successful program implementation. This $2 million will cover the 
cost of critical pathway design, patient recruitment, education/
wellness programs, and other necessary administrative costs.
    We request that this $5 million be accompanied by an additional $15 
million appropriation to the Department of Health and Human Services. 
This funding, along with the $5 million to the Georgetown 
demonstration, will amount to $20 million in additional funding to the 
Health Care Financing Administration for ``Research, demonstrations, 
and evaluation projects'' (Budget of the United States Government, 
Appendix, fiscal year 1999). In fiscal year 1998, the Health Care 
Financing Administration requested $50 million for research, 
demonstrations, and evaluation projects but was appropriated $53 
million by the Senate. We wish to have additional funds appropriated to 
this line item again in fiscal year 1999.
    Appropriation of the above funds to the Health Care Financing 
Administration will allow for the successful exploration of new and 
innovative modes of delivering quality care to chronically-ill, high 
risk individuals in a cost-effective manner.
                                 ______
                                 
Prepared Statement of Antonio De La Cruz, MD, FACS, President, American 
         Academy of Otolaryngology-Head and Neck Surgery, Inc.
    Members of the subcommittee, ladies and gentlemen, I am Dr. Antonio 
De la Cruz, President of the American Academy of Otolaryngology-Head 
and Neck Surgery, Inc. (AAO-HNS), the world's largest organization of 
otolaryngologists and head and neck surgeons. There are more than 
10,000 members, including 97 percent of all Board-certified otolaryn-
gologists.
    Mr. Chairman, I and the members of the AAO-HNS and the patients 
that they are privileged to care for all owe an immense debt of 
gratitude to you and your colleagues on this subcommittee for your hard 
work in providing greatly increased funding for the National Institutes 
of Health (NIH) for fiscal year 1998 and particularly for the
National Institute on Deafness and Other Communication Disorders 
        (NIDCD)
    National Institute on Deafness and Other Communication Disorders 
(NIDCD) The NIDCD has a mission of unique importance to the nation's 
health and to its economic and social well being--including insuring 
the optimization of communication skills regarding hearing, voice, 
speech and language.
    NIDCD-supported scientists have made extraordinary strides in the 
understanding of and the basic processes which underlie the many 
diseases and disorders of hearing, balance, taste, smell, voice, speech 
and language.
    These advances have come from the many different fields of science.
  --The genetic bases of deafness is being unraveled.
  --Promising studies in animal models indicate that it is possible to 
        protect the inner ear through the use of growth factors or the 
        introduction of viruses whose DNA has been altered so that 
        appropriate protective substances are produced and released in 
        the inner ear.
  --Further work along the same lines is being undertaken to repair the 
        damage which has occurred and to replenish the cells of the 
        inner ear which have been destroyed.
    All of these studies will soon be tested in patients.
  -- Further advances have been made in the prostheses for the hearing 
        impaired, including hearing aids and the cochlear implant. Many 
        of these advances have been directly applied to patients 
        enabling them to communicate with others and contribute to the 
        economic and social well being of our society.
  --Advances in our basic understanding of the human voice have 
        resulted in surgical procedures which have restored voice to 
        those who could only speak in a whisper.
  --Linguistic studies are one of the most important areas of the NIDCD 
        mission. NIDCD-sponsored scientists are defining the biological 
        bases of language. This work is being accomplished through the 
        observation of infants, the use of human electro-physiology and 
        the utilization of the advances of brain imaging. The 2 
        information gained from these studies will enable physicians to 
        diagnose and treat the many language disorders which put so 
        many at disadvantage in our communication-based society.
    The NIDCD, one of the newest institutes at NIH, has made rapid 
progress and is at a point in which there are more needs than 
resources. This is especially true in two areas: translational 
research--applying the fruits of basic research to the patients and 
clinical trials, and evaluation of the effectiveness of different 
therapies.
    The science which is required in these areas is expensive but 
necessary and the NIDCD needs to have the additional resources so that 
it can continue to take advantage of all of the advances in the various 
forms of basic research but also to carry out needed translational and 
clinical studies. The investment in the NIDCD will have substantial 
economic as well as health advances for it insures optimal economic 
productivity through improved communication abilities for our citizens.
    Dr. Ruben and I, along with colleagues from our Academy and others 
attended a conference recently called by the NIDCD on Economic and 
Social Realities of Communication Differences and Disorders. This 
conference was called for in bill report language last year, urged by 
Dr. Ruben. The conference dealt with issues of diagnosed and 
undiagnosed childhood communication disorders, including learning 
disabilities and dyslexia, deafness, specific language impairment, and 
stuttering, as well as the impact of such diseases and disorders on 
crime and incarceration.
    The conference revealed that the economic bases of our society--the 
way in which people make their livelihoods--has undergone fundamental 
change during the last half of the 20th century. In the past, we 
depended largely on manual labor. Today we depend upon communication 
skills. This, in turn, has a profound effect on definitions of illness, 
and on society's expectations and demands of the medical profession.
    This revolutionary change in ``making a living'' is reflected in 
the labor statistics for New York City. In 1900, manual labor accounted 
for 94 percent of the 149,000 jobs in the city. By the middle of the 
century, in 1950, only 31 percent of the 3.5 million jobs were in 
manual labor; the other 69 percent (2.6 million) were based primarily 
upon the communications skills of the workers. The trend has 
continued--in 1996, 88 percent of the 3.2 million jobs in New York City 
were dependent upon communication skills. In real numbers, from 1950 to 
1996 the number of manual labor jobs was reduced by 66 percent from 
1,163,000 in 1950 to 392,024 jobs in 1996. At the same time, the number 
of workers who rely on communication skills increased by 9 percent from 
2,588,700 in 1950 to 2,832,000 in 1996; 771,676 manual jobs no longer 
exist: these have been replaced by communication-based employments. 
Bureau of Labor projections for the United States as a whole indicate 
that by the year 2005 employment will increase by 17.7 million jobs of 
which at least 92 percent (16.2 million) of these new jobs will be 
based on communication skills.
    The NIDCD mission is to provide the knowledge which is needed to 
prevent, cure and care for all of the diseases of communication so that 
this country may have a communicatively healthy and competitive 
population.
National Institute of Environmental Health Sciences (NIEHS)
    Our Academy has long been interested in issues affecting 
environmental health of humans, and the health of the environment 
generally. In several instances, we have cooperated with the National 
Institute of Environmental Health Sciences (NIEHS) in conferences and 
meetings dealing with air pollution, water pollution and soon, 
hopefully, on the issue of environmental noise and its impact on 
hearing and upon the environmental well being of people generally.
    For example, the Academy participated as a founding organization of 
the National Association of Physicians for the Environment, at its 
founding conference in 1993, supported by the NIEHS. Also, we played a 
major role in the ``National Conference on Air Pollution Impacts on 
Body Organs and Systems'' and the recent ``International Conference on 
Water Pollution and Health,'' both supported in part by the NIEHS.
    Michael D. Maves, MD, MBA, now serves as Chairman of the National 
Council on Healthcare Energy Efficiency and ``Greening'' of Healthcare 
of the National Association of Physicians for the Environment, working 
to improve energy efficiency in healthcare and medical research 
facilities. The National Institutes of Health has won several energy 
efficiency awards for its work at the Bethesda campus; the NIEHS has 
worked to improve energy efficiency at the North Carolina campus and is 
now considering how to assist extramural researchers to do the same in 
their facilities.
    We believe that human health is inseparable from a healthy 
environment.
    We have watched as the NIEHS has worked hard in recent years to 
reach out to all the constituencies which affect or are affected by a 
polluted environment. We believe major strides have been made in this 
regard.
    We therefore urge a significant increase for the NIEHS of at least 
15 percent.
    Mr. Chairman, we fully support the request of the Ad Hoc Group for 
Medical Research Funding, of which we are members, for a 15 percent 
increase overall for the NIH. Because of the special importance and the 
extraordinary demands of outstanding science upon the NIDCD we request 
an 18 percent increase for NIDCD. We also urge an increase of 15 
percent for the NIEHS.
    Mr. Chairman, thank you for the opportunity to testify and I will 
be pleased to answer any questions which you may have.
                                 ______
                                 
  Prepared Statement of Arthur L. Day, M.D., American Association of 
                         Neurological Surgeons
    Mr. Chairman and Members of the Subcommittee, My name is Arthur L. 
Day, M.D. I am a professor of Neurological Surgery at the University of 
Florida in Gainesville, Florida, and I appear here today on behalf of 
the American Association of Neurological Surgeons (AANS) and the 
Congress of Neurological Surgeons (CNS), which represent over 4,000 
practicing neurosurgeons in the United States. The AANS and CNS thank 
you for the opportunity to comment on the fiscal year 1999 neuroscience 
agenda for the National Institutes of Health (particularly the National 
Institute of Neurological Disorders and Stroke) and the Agency for 
Health Care Policy and Research.
Past funding requests
    Before presenting our recommendations and justifications for 
program support in fiscal year 1999, we wish to briefly outline our 
previous funding requests during the Decade of the Brain. Spinal 
disorders, vascular diseases of the brain, and genetic disorders 
(including brain tumors) represent the three most common afflictions of 
the nervous system impacting the health of the American public. In the 
past, we have focused on these three areas and have requested funding 
for biomedical research for: (1) brain tumor research centers, (2) 
stroke and cerebrovascular disorders, (3) gene therapy for brain tumors 
and other diseases of the nervous system, (4) basic research on spinal 
cord injury, spinal degenerative diseases, and the biomechanics of 
spinal instability, and (5) stereotactic surgery of the brain and 
spine. The Committee has been very receptive to these requests, and we 
urge the Committee to continue to intensify its efforts in these areas 
to build on the foundation of prior Decade of the Brain initiatives.
Fiscal year 1999 funding requests
    For fiscal year 1999, we urge the Subcommittee to direct its 
funding attention to five areas of research: (1) head and spinal cord 
injury, (2) stroke and cerebrovascular disease, (3) molecular biology 
as it applies to tumors and other nervous system disorders, (4) spinal 
disorders and pain, and (5) outcomes research into the effectiveness of 
new therapies for neurological disorders.
    Treatment of head and spinal cord injuries.--Trauma to the brain 
and spinal cord remains a major public health issue in the United 
States, and is a leading cause of death and disability among children 
and young adults. Head injuries are present in 75 percent of fatal 
automobile accidents. The direct and indirect costs of traumatic spinal 
cord injuries are estimated to be over $7 billion annually. New 
pharmacologic protection agents can now be shown to decrease the amount 
of brain and spinal cord damage produced in experimental animals 
subjected to vascular or traumatic injury. In a recent NIH-funded 
study, the early administration of methylprednisolone improved the 
neurologic recovery of patients with spinal cord injuries. Functional 
recovery can also be improved by prompt treatment. Thus, head and 
spinal cord injury patients should be promptly evacuated to centers 
ready to treat them with effective surgical and chemical support.
    A number of important treatment questions about such injuries 
remain that should be the subject of carefully designed clinical trials 
to determine the optimal treatment paradigm. The value of early versus 
delayed decompression of spinal fractures with spinal cord injury 
represent one such issue. Ultimately, of course, the ability to restore 
function of injured brain and spinal cord tissues is the key to central 
nervous system injuries and treatment, and we believe that basic 
research targeted at this goal should be a major priority of this 
Committee.
    Stroke and cerebrovascular disease research.--The term ``stroke'' 
is often applied to capture a number of conditions in which the brain's 
blood vessels either rupture or become blocked, resulting in some 
degree of neurologic injury. Stroke is the third leading cause of death 
in the United States, and between 1992 and 1995, stroke deaths have 
increased by ten percent. Stroke is also a leading cause of long term 
disability. Each year, 500,000 new cases are diagnosed, at an estimated 
annual cost of $30 billion. More than half of this total is attributed 
to acute, rehabilitative and nursing home care, while the remaining 
costs are due to lost productivity, alteration in lifestyle, and the 
economic burden assumed by family members and other care-givers.
    In recent years, the catastrophic consequences of stroke have 
diminished, in part through better understanding of the basic chemical 
and physiological processes that result in brain cell death. Aggressive 
medical treatments before or early after the onset of stroke symptoms 
can now significantly improve outcomes by enhancing the recovery of 
function, results of surgery, and the outcome of rehabilitation. For 
example, the intraoperative administration of barbiturates to certain 
patients undergoing carotid artery surgery or certain intracranial 
vascular procedures can significantly reduce the stroke risks inherent 
in such operations.
    Recently, the concept of ``Brain Attack,'' similar in its 
implications to a heart attack, has gained the support of the National 
Stroke Association, American Heart Association, and many neurologists 
and neurosurgeons across the country. The major thrust of the Brain 
Attack initiative is early diagnosis and administration of therapeutic 
agents and operations, in the hope of limiting or reversing the damage 
produced by the stroke. The immediate goals of stroke treatment include 
the rapid restoration of blood flow to areas of the brain lacking 
circulation, protection of brain cells (neurons) from irreversible 
damage, and rescue of those cells that have undergone molecular and 
biomechanical changes from lack of nutrients and oxygen. Restoration of 
the circulation and delivery of drugs must be rapidly carried out 
within a ``window of opportunity'' before irreversible brain damage 
occurs. The acute treatment of these disorders has only recently become 
feasible and models the demonstrated medical and economic successes of 
heart attack treatment though early recognition, resuscitation and 
organ protection. Prototypical agents for decreasing brain damage and 
increasing efficiency of restored blood flow already exist. We are 
convinced that your continued support will lead to substantial life-
saving and function saving progress.
    Molecular approach to treatment of brain tumors and other 
disorders.--Brain tumors represent the third leading cause of cancer 
deaths in middle-aged males and tumors of the nervous system are the 
second leading cause of cancer deaths among children. Each year more 
than 10 percent of the 400,000 new patients with other types of cancer 
eventually see their disease spread to the brain and spinal cord. In 
many such patients, the nervous system tumor constitutes the single 
most immediate threat to their life and function.
    The recent application of molecular biologic techniques to the 
central nervous system has revolutionized our understanding of how 
brain tumors grow and spread. For example, we now know that the absence 
of some genes, which normally act as ``brakes'' on tumor development, 
can cause diseases such as neurofibromatosis, a condition associated 
with multiple nervous system tumors.
    Neurosurgeons have been leaders in the development of new methods 
of drug delivery into the nervous system, and these techniques can be 
used to deliver genes and hormones. Therapeutic agents can be directly 
injected into the brain by modern image-based stereotactic techniques, 
while cells in other parts of the body are shielded from potential 
injury. Genetic material can be linked to immunological agents and 
other chemicals to cause the death of tumor cells, and insertion of 
normal genes into the brain may help control the expression of brain 
cancer. Similar research in such disorders as Parkinson's disease, Tay-
Sach's, Huntington's disease and Alzheimer's dementia is already 
underway, and may reduce the $100 billion annual burden faced by the 
American public. Your continued support can lead to the discovery of 
the full range of genetic abnormalities that underlie the development 
of brain tumors and degenerative diseases. Once these ``targets'' are 
identified, new molecular bullets can be designed and directly entered 
into the nervous system to fight these deadly and costly diseases.
    Research into spinal disorders.--Disorders of the spinal cord, the 
spinal nerve roots and the bony spine are some of the leading causes of 
pain and disability in the United States today. Each year 15-20 percent 
of the population will have an episode of back pain, and during their 
lifetime, about 70 percent of U.S. citizens have an episode of serious 
back and/or leg pain caused by diseases of the spine. Currently, back 
and leg pain are the second most common reason for physician visits in 
the United States.
    Recent progress in basic neuroscience research has markedly 
enhanced our understanding of basic mechanisms of pain, and has allowed 
us to have a much better understanding of how the spinal cord controls 
movement and integrates sensation. Further basic research is needed to 
investigate and identify mechanisms that underlie the loss of function 
and production of pain whenever the spinal cord or nerve roots are 
compressed by discs or bone spurs into the spinal canal, thus allowing 
more effective pharmacological and less invasive treatment modalities 
to be developed to improve the lives of so many people who suffer from 
degenerative diseases of the spine.
    Clinical and outcomes research is also needed to help us to 
understand the optimal utilization of both non-surgical and surgical 
treatments of spinal diseases. It is clear that some patients with 
serious spinal disorders can only be helped by surgery. Clinical 
research in this area would help physicians more expeditiously evaluate 
patients with spinal disease and more appropriately select patients for 
operative treatment, thus limiting the patient's time of anguish before 
definitive and pain-relieving surgical intervention is performed.
    Outcomes research.--Technology is now driving the contemporary 
treatment of neurologic disorders at an unprecedented degree. New drugs 
to treat stroke, genetic agents to treat brain tumors, and 
radiosurgical devices and spinal instrumentation all represent 
significant financial investments. Pallidotomy, a highly technical 
surgical disconnection of the malfunctioning areas of the basal 
ganglia, is very successful in halting tremors and other symptoms for 
Parkinson's disease patients. The costs of these therapies are easily 
justified if the benefits of decreased suffering and additional years 
of useful survival outweigh the amortized costs of therapy. Outcomes 
research can do much to guide patients, their physicians and policy 
makers in therapeutic decision making and resource allocation. We urge 
you to provide funds to the Agency for Health Care Policy and Research 
to: (1) improve the methodology of outcomes research in neurological 
disorders, and (2) support pilot studies in the treatment of stroke, 
brain tumors, degenerative diseases and spinal disorders.
    These funding priorities will be costly, but can have a major 
impact on the quality of life for our citizens. The brain does not lend 
itself to surgery in the way that other organs do. It cannot be cut and 
stitched back together. It does not naturally heal and regain function. 
More research is therefore needed to discover new treatments and 
therapies for neurological disorders.
    Mr. Chairman, and members of the Subcommittee, as we approach the 
final year of the Decade of the Brain and the new millennium, the AANS 
and CNS hope that Congress will continue its commitment to biomedical 
research for nervous system disorders. These funding priorities are 
costly, but can have a major impact on the quality of life for our 
citizens.
    Thank you for your consideration.
                                 ______
                                 
  Prepared Statement of the American Association of Nurse Anesthetists
    The American Association of Nurse Anesthetists is the professional 
association that represents over 27,000 certified registered nurse 
anesthetists (CRNAs) in the United States. AANA appreciates the 
opportunity to provide our experience regarding federal funding for 
nurse anesthesia educational programs under Title VIII, the Nurse 
Education Act (NEA). Many members of our association have benefited 
greatly over the years from the Title VIII programs, which in turn has 
benefited the health care system by assisting in the maintenance of a 
stable supply and adequate number of anesthesia providers.
Background information about CRNA's
    In the administration of anesthesia, CRNAs perform many of the same 
functions as physician anesthetists (anesthesiologists) and work in 
every setting in which anesthesia is delivered including hospital 
surgical suites and obstetrical delivery rooms, ambulatory surgical 
centers, health maintenance organizations, and the offices of dentists, 
podiatrists, ophthalmologists, and plastic surgeons. Today, CRNAs 
administer more than 65 percent of the anesthetics given to patients 
each year in the United States. CRNAs are the sole anesthesia provider 
in 70 percent of rural hospitals which translates into anesthesia 
services for millions of rural Americans. CRNAs are also front line 
anesthesia providers in underserved urban areas, providing services for 
major trauma cases, for example.
    CRNAs have been a part of every surgical team since the advent of 
anesthesia in the 1800s and until the 1920s, anesthesia was almost 
exclusively administered by nurses. In addition, nurse anesthetists 
have been the principal anesthesia provider in combat areas in every 
war the United States has been engaged in since World War I. Though 
CRNAs are not medical doctors, no studies have ever found any 
difference between CRNAs and anesthesiologists in the quality of care 
provided, which is the reason no federal or state statute requires that 
CRNAs be supervised by an anesthesiologist. Anesthesia outcomes are 
affected by such factors as the provider's vigilance rather than the 
title of the provider--CRNA or an anesthesiologist. That is why the 
Harvard Medical School Standards in Anesthesia focus on monitoring the 
patient; the standards are based upon data that indicate that 
anesthesia incidents are usually caused by lack of attention to detail 
and insufficient monitoring of the patient.
    The most substantial difference between CRNAs and anesthesiologists 
is prior to anesthesia education, anesthesiologists receive medical 
education while CRNAs receive a nursing education. However, the 
anesthesia education offered is very similar for both providers and 
both professionals are educated to perform the same clinical anesthesia 
services: (1) preanesthetic preparation and evaluation; (2) anesthesia 
induction, maintenance and emergence; (3) postanesthesia care; and (4) 
peri-anesthetic and clinical support functions, such as resuscitation 
services, acute and chronic pain management, respiratory care, and the 
establishment of arterial lines.
    There are currently 85 accredited nurse anesthesia education 
programs in the United States, all of which are required to offer a 
master's degree.
Are there enough providers to meet the goals?
    The Health Professionals Scholarship program was created to address 
certain needs of the population, including increased access to primary 
care, increased access in rural and underserved areas, and improved 
distribution of providers. But before we can begin to focus on the 
goals of the Health Professionals Scholarship Program, there must be 
assurances that our programs are producing enough graduates to serve 
the population as a whole.
    The overall number of primary care physicians providing patient 
care rose by 75 percent between 1975 and 1990; yet, the population as a 
whole rose by only 17 percent. The result has been a physician surplus. 
Yet the same is not true for other health care professions. The surplus 
of physicians does not necessarily translate to a surplus of all 
providers. Nurse anesthesia programs across the country have 
stabilized, not increased, in the number of graduates produced each 
year, averaging approximately 900-1,000 new nurse anesthetists entering 
practice annually.
    Data have shown that a continued supply of 1,000 graduates per year 
will provide the country with a stable, adequate source of anesthesia 
providers. Previous research by Michael Fallacaro, CRNA, DNS, Assistant 
Professor at the School of Nursing, State University of New York at 
Buffalo, established that the current ratio of approximately 8.5 CRNAs 
per 100,000 population is adequately meeting societal demands. In 
addition, his research showed that adding 1,000 new nurse anesthetist 
graduates into the system each year through 2020 would ultimately 
result in a similar ratio of 8.5 to 9.6 CRNAs per 100,000 population, 
depending on the average retirement age. Therefore, by continuing the 
trend of graduating approximately 1,000 students per year, nurse 
anesthesia programs appear to be producing not a surplus of providers, 
but an adequate number to meet societal needs.
    In order to maintain this number of graduates, CRNA students need 
continued federal support. Nurse anesthesia programs require a rigorous 
course of study that does not allow students the opportunity to work 
outside their educational program. Nurse anesthesia programs are 
virtually all full-time, with part-time study a rare occurrence. 
Therefore, nurse anesthesia students rely heavily on federal funding to 
assist them in meeting financial obligations during their study. 
Without this assistance, the number of nurse anesthesia graduates would 
surely decline. A decline in the number of nurse anesthetists would 
then result in a decline in the accessibility to services, primarily in 
rural areas that depend on non-MD providers for the majority of their 
care.
The Goals of the Health Professionals Education Program
    Title VIII has supported the education of our nation's nurses since 
the 1960s. It provides programs for direct student assistance as well 
as grants to institutions for expansion or maintenance of education. 
While initially the programs focused on increasing enrollments, in the 
mid-1970s they began to shift toward increasing the number of primary 
care providers and increasing the number of professionals serving in 
rural or underserved areas.
    In the last reauthorization of Title VIII in 1992, Congress 
directed that Title VIII programs target funds to schools placing 
graduates in medically underserved communities and emphasized primary 
care. Likewise, the Health Professions Education Reauthorization Act of 
1994, which passed the Senate Labor and Human Resources Committee, also 
identified the goal of improving the distribution of health 
professionals in underserved areas. The investment in the education of 
nurse anesthetists would assist in all of these goals:
    Increased access to primary care.--CRNAs are traditionally not 
defined as primary care providers, but provide services that support 
primary care. For example, a facility or professional that provides 
obstetrical care to pregnant women is generally recognized as providing 
primary care. Offering an epidural during labor and delivery is part of 
that obstetrical care; therefore, the CRNA provides services and 
supports primary care, and is vital to the quality of primary care. 
Often the CRNA is the only provider of such services in rural areas. 
Because of the interdependence between primary care and anesthesia, 
continued federal support for nurse anesthesia education will assist in 
reaching the federal goal of increasing access to quality primary care 
across the country.
Access and distribution in rural and underserved areas
    CRNAs are the sole providers of anesthesia in 70 percent of rural 
hospitals. Anesthesia provided by CRNAs allows these rural facilities 
to provide obstetrical, surgical, and trauma stabilization that would 
otherwise not be possible for millions of Americans in rural areas. 
Continued federal support of Title VIII programs will ensure a stable 
supply of CRNAs to rural facilities all across the country. In 
addition, many nurse anesthesia programs are located in medically 
underserved urban areas and produce graduates that eventually enter 
practice after graduation in these same communities.
    While there continues to be a stable supply of nurse anesthesia 
graduates, there remains a problem with distribution of anesthesia 
providers (both nurse anesthetists and physician anesthesiologists) 
between urban and rural areas. As is the case with many types of 
providers, there tends to be a concentration in urban settings, with 
far fewer providers located in rural areas. Taking into account that 
there are fewer people requiring services in rural areas, the 
maldistribution of providers is still evident.
    The following graph illustrates the percentage of CRNAs located in 
urban vs. non-urban areas, demonstrating clearly that urban areas 
retain far greater percentages of anesthesia providers. Keep in mind, 
however, that the data vary widely from state to state depending on its 
makeup. For example, because the state of New York is one of the most 
urban states in the country there will naturally be a greater number of 
providers in urban areas because the state is primarily composed of 
urban counties. Fallacaro's data show that 90 percent of New York CRNAs 
are located in urban areas, with the remaining 10 percent situated in 
rural New York. Compare that to a very rural state, North Carolina, in 
which only 77 percent of CRNAs are providing services in urban areas 
and 23 percent are in rural areas. The national average is 81.3 percent 
of CRNAs practicing in urban areas, compared to 18.7 percent in non-
urban areas.

                              [In percent]
------------------------------------------------------------------------
                                            Urban areas     Rural areas
------------------------------------------------------------------------
Urban State--New York...................            90.0            10.0
Rural State--North Carolina.............            77.0            23.0
Average.................................            81.3            18.7
------------------------------------------------------------------------


    Generally there is a greater number of anesthesia providers per 
100,000 population in urban areas than in non-urban areas. Recent 
research by Dr. Fallacaro has revealed that, on average, there are 8.55 
nurse anesthetists per every 100,000 people, and an average of 8.22 
anesthesiologists (MDAs) per 100,000 people (see middle bar below). A 
breakdown of urban and rural areas show that there are more than 
average numbers of anesthesia providers in urban areas, and fewer than 
average in non-urban areas.

                                   [Ratio of providers per 100,000 population]
----------------------------------------------------------------------------------------------------------------
                                                                       Urban         Non-urban        Average
----------------------------------------------------------------------------------------------------------------
CRNA's..........................................................            8.57            7.76            8.55
MDA's...........................................................            9.42            3.14            8.22
----------------------------------------------------------------------------------------------------------------


    It is likely that the problem of distribution will only get worse, 
as an aging CRNA population is concentrated more in non-urban areas 
than in urban. Looking at the CRNA population as a whole, approximately 
19 percent provide services in non-urban areas. Focusing solely on the 
CRNA population aged 55 and older, approximately 29 percent provide 
services in non-urban areas. This indicates that a disproportionate 
number of CRNAs in rural areas are aged 55 or older. As these CRNAs 
retire, it remains unclear what will happen to anesthesia services in 
those areas without continued incentives such as the Health 
Professionals Scholarship Program.
Recommendation for fiscal year 1999
    In the past, CRNAs had a $4 million authorized line-item 
appropriation within Title VIII which was divided between direct 
student support in the form of traineeships, faculty fellowships to 
increase the number of doctoral-prepared faculty, and toward the start-
up costs and expansion for nurse anesthesia programs. This line-item 
has proven extremely successful in the past, and each year the 
appropriation for nurse anesthetists has been totally expended. AANA 
would like to see it continue in the future. However, we realize this 
Congress has moved in the direction of a consolidated appropriation. 
AANA understands the need for increased streamlining and administrative 
reductions, and supports the Committee's efforts in this regard.
    AANA would appreciate and certainly utilize a substantial increase 
in funding, but recognizing the budgetary constraints faced by this 
Committee we would recommend continued federal funding for all nursing 
education at the level of $64.738 million, including a $2.833 million 
set-aside for nurse anesthetists in fiscal year 1999. This is 
equivalent to the House-passed level in fiscal year 1998.
    Thank you for your consideration of our concerns.
                                 ______
                                 
Prepared Statement of Marianne Puckett, Associate Professor of Medical 
 Library Science, Louisiana State University Medical Center Library on 
   Behalf of the, Medical Library Association and the Association of 
                   Academic Health Sciences Libraries
    Mr. Chairman and members of the subcommittee, I am Marianne 
Puckett, associate professor of medical library science at the 
Louisiana State University Medical Center Library in Shreveport, La. 
Thank you for the opportunity to provide written testimony on behalf of 
the Medical Library Association (MLA) and the Association of Academic 
Health Sciences Libraries (AAHSL) regarding the fiscal year 1999 budget 
for the National Library of Medicine (NLM).
    As you may know, MLA is a professional organization representing 
over 4,000 individuals and 1,200 institutions involved in the 
management and dissemination of biomedical information to support 
patient care, education and research. I might add Mr. Chairman, that 
MLA's headquarters are located in your home town of Chicago. In 
addition, we are very proud this year to be celebrating our centennial 
anniversary.
    AAHSL, is comprised of the directors of libraries of 142 accredited 
U.S. and Canadian medical schools belonging to the Association of 
American Medical Colleges. Together, MLA and AAHSL address health 
information issues and legislative matters of importance to the medical 
library community through a joint legislative task force which I 
currently have the honor of chairing.
    Mr. Chairman, first let me thank you and the members of the 
subcommittee for your leadership in securing a 7.2 percent increase for 
the National Library of Medicine in fiscal year 1998. With respect to 
NLM's budget for the coming fiscal year, I would like to touch briefly 
on the following three issues; (1) basic services and personnel, (2) 
outreach activities, and (3) access to health care information.
NLM basic services and personnel
    As we approach the next century, the medical library community 
believes that basic library services must still be the foundation for 
NLM's long-term success as a service agency. Unfortunately, the level 
of demand for basic NLM services and the rate of increase in the cost 
of medical journals and books have both been in the 10 to 15 percent 
range in recent years, far outstripping the Library's budget increases. 
Moreover, the level of staffing at the Library has been held level over 
the past several years. Maintaining the current standard of 
acquisitions, indexing, cataloging, database searching, and lending 
will become more and more difficult, if not impossible, unless NLM's 
budget and level of staffing are increased to reflect these rising 
workloads and costs. As a result, we urge the subcommittee to consider 
the need for increasing support, in both budget and staff positions, so 
that NLM can meet its increasing service needs and insure that the 
quality of its programs is not compromised.
Outreach programs
    NLM's outreach programs are of particular interest to both MLA and 
AAHSL. These activities, designed to educate medical librarians and 
other health care professionals about NLM and the information services 
it provides have proven to be extremely successful in improving the 
quality of our nation's health care.
    Although NLM has been able to educate a significant number of 
health care professionals through its outreach initiatives in the 
1990's, more work needs to be done in this area. There are still far 
too many health care workers in all parts of the country who are 
unaware that NLM and the National Network of Libraries of Medicine even 
exist. The need for a vigorous outreach program is now more important 
than ever. In 1997, NLM's databases became available free over the 
Internet and World Wide Web, opening them up to the general public and 
health professionals alike. Mr. Chairman, NLM's outreach mission will 
not be complete until all who need access to science-based health 
knowledge are familiar with NLM and the information resources it 
provides.
Access to quality health care information
    Mr. Chairman, the National Library of Medicine, continues to be the 
critical investment agency for increasing the public's access to health 
care information. This is especially true for people living in 
medically underserved areas. For example, my institution maintains 
several telemedicine and distance learning sites throughout rural 
Louisiana. With the support of NLM technology we provide access to 
health information and education resources to some of our state's most 
at-risk citizens. In addition to its support of telemedicine, NLM's 
High-Performance Computing and Communications initiative and free 
Internet MEDLINE information service have empowered Americans with the 
ability to access the world's most extensive library of medical data 
directly from their personal computer.
    We in the health sciences library community applaud the Congress 
for having the foresight to provide NLM with the necessary resources to 
develop these programs. There is no question that these technologies 
are having a profound influence on the delivery of health care across 
the country. In order to realize the full potential of these programs 
it is crucial that Congress continue to provide NLM with adequate 
funding in fiscal year 1999.
Fiscal year 1999 recommendation
    Mr. Chairman, as we celebrate the 200th anniversary of the Public 
Health Service this year it is important that we continue to prepare 
for the future. With the seemingly endless advances of the information 
age it is obvious that the National Library of Medicine will play a 
major role in the delivering health care in the 21st Century.
    Therefore, the Medical Library Association and the Association of 
Academic Health Sciences Libraries recommend a 15 percent increase in 
funding for NLM in fiscal year 1999. This figure represents a $24 
million increase over fiscal year 1998 and would bring the Library's 
total fiscal year 1999 appropriation to $185,362,750.
    In closing, I would like to make clear that although the medical 
library community strongly supports the concept of doubling NIH's 
overall budget in the next five years, we do not believe that these 
increases should come at the expense of other important Public Health 
Service programs.
    Once again, Mr. Chairman, thank you very much for the opportunity 
to present the views of the medical library community. If you have any 
questions please do not hesitate to contact me.
                                 ______
                                 
      Prepared Statement of Walter Digiusto, President, ESA, Inc.
    Mr. Chairman, thank you very much for the opportunity to submit 
written testimony regarding fiscal year 1999 appropriations for the 
National Institutes of Health (NIH), and the Centers for Disease 
Control and Prevention (CDC). I am Walter DiGiusto, President of ESA, 
Inc. of Chelmsford, MA.
    ESA is a biomedical research and technology development firm 
dedicated to improving the quality of our nation's health care through 
innovative instrumentation and services. In my testimony, I will 
discuss four issues of specific interest to our company and millions of 
Americans; (1) Lead Poisoning Prevention (2) Neurodegenerative 
Disorders, (3) the Small Business Innovative Research Program, and (4) 
Alternative Medicine.
Lead poisoning prevention
    For over 25 years, ESA has focused on developing electrochemical 
sensors for the early detection and treatment of several chronic, 
environmentally induced disorders. These abnormalities include; lead 
poisoning, cancer in young children, brain injuries, metabolic 
disorders, and Alzheimer's and Parkinson's diseases. We began in 1970 
with the development of an instrument which allowed for the measurement 
of lead levels in children at the part per million level. This was done 
at the request of the Centers for Disease Control and Prevention which 
had been given the task of determining the degree of childhood lead 
poisoning in the United States.
    With the support of this subcommittee and CDC, we have recently 
developed a new hand-held, portable lead screening instrument. I very 
am pleased to inform the subcommittee that last September, Secretary of 
Health and Human Services Donna Shalala announced that the Food and 
Drug Administration (FDA) had given final approval to ESA's LeadCare 
System for use as a medical device.
    Mr. Chairman, the availability of the LeadCare System is truly a 
major step forward in the fight against childhood lead poisoning. 
Currently, blood samples from children tested for exposure to lead must 
be sent to a laboratory for clinical evaluation. With the LeadCare 
System, a sample of a patient's blood obtained by a finger stick can be 
analyzed by the System within 3 minutes, and the results are instantly 
displayed. Moreover, clinical studies conducted by ESA indicate that 
the new test is as reliable as established laboratory screening 
methods. Both ESA and the Department of Health and Human Services 
believe that the expediency of the LeadCare System will allow health 
care professionals practicing in urban, underserved areas to screen 
more high-risk children in transient inner-city communities.
    Finally, Mr. Chairman, I would like to state for the record ESA's 
strong support of the Centers for Disease Control and Prevention's 
Childhood Lead Poisoning Prevention Program. This program, funded at a 
level of $38 million last year, has played an effective role in 
increasing public awareness regarding childhood lead poisoning and the 
need for early detection. I encourage the subcommittee to continue its 
support of this important public health campaign.
                      neurodegenerative disorders
    In addition to our lead screening devices, ESA has developed 
several sophisticated analytical instruments which measure a broad 
range of neurochemicals. As a result, we have become extremely active 
in research related to neurodegenerative disorders like Alzheimer's and 
Parkinson's diseases. In studies conducted with NIH support, we have 
shown that it is possible to separate neurodegenerative diseases by 
their biochemistry patterns. When considered as a whole, the pattern of 
hundreds of compounds in an individual with Alzheimer's is uniquely 
different from those in a healthy individual or a person afflicted with 
Huntington's or Parkinson's. In addition to these findings, we have 
been encouraged by follow-up studies suggesting promising preventive 
therapies for neurodegenerative diseases, including the use vitamin E 
and other anti-oxidants.
    Mr. Chairman, ESA is committed to continuing to develop 
technologies that will assist the scientific community in the fight 
against neurodegenerative disorders. We are very pleased that in fiscal 
year 1998, the NIH Office of the Director received $22 million dollars 
for the study of these devastating diseases. We encourage the 
subcommittee to continue to emphasize the importance of brain disorders 
research as we approach the next millennium.
               small business innovative research program
    Mr. Chairman, I am aware that questions have been raised regarding 
the merit of SBIR research projects funded by the National Institutes 
of Health. I would like to make it clear that the SBIR program is 
critical to the success of biotechnology firms like ESA. Throughout our 
existence, ESA has worked on several joint initiatives with NIH and CDC 
under the SBIR program. As a result of these collaborations, we have 
seen a positive return on the public's investment in the areas of job 
creation, balance of trade, reduction of health care costs, and the 
alleviation of suffering. Simply stated, the SBIR program has allowed 
ESA to successfully pursue research projects that we would have 
otherwise had to forego.
    ESA strongly supports President Clinton's fiscal year 1999 budget 
request of $289 million (an increase of $27 million over fiscal year 
1998), for NIH SBIR/STTR grants. We urge the subcommittee to support 
this vital program in fiscal year 1999.
                          alternative medicine
    Mr. Chairman, as you know, there has been an explosion in this 
country during the past decade in the field of alternative medicine. 
Public interest in the use of dietary and herbal supplements, vitamins, 
hormones, and other ``natural'' products for the purpose of disease 
prevention has spawned tremendous concern about safety and truth-in 
advertising. As a result, ESA has embarked on a analytical program 
aimed at identifying compounds and anti-oxidants found in vitamins, 
health foods, natural products, and cereals. Our goal in this endeavor 
is two-fold; (1) assist researchers and manufacturers of dietary 
supplements in the development of quality products, and (2) provide 
consumers with piece of mind in knowing that the products they use are 
safe.
    As the alternative medicine industry continues to expand, we look 
forward to increasing our role as one of the few firms in the country 
able to provide this type of sophisticated service. It is clear that 
the federal government will also play an enhanced oversight role in the 
years to come. Specifically, ESA views the Office of Alternative 
Medicine (OAM), and the Office of Dietary Supplements (ODS) at NIH as 
critical to insuring the integrity of the alternative medicine 
industry. We urge the subcommittee to provide adequate funding to both 
OAM and ODS in fiscal year 1999.
    Mr. Chairman, once again thank you very much for the opportunity to 
present our views. In closing, I would like to associate ESA with the 
Ad Hoc Group for Biomedical Research's recommendation of a 15 percent 
overall increase for the National Institutes of Health in fiscal year 
1999. We look forward to continuing to work with the subcommittee to 
improve the quality of health care for all Americans. If you have any 
questions please do not hesitate to contact me.
                                 ______
                                 
Prepared Statement of Joanne Bakken Pease, Immune Deficiency Foundation
    Mr. Chairman, thank you very much for the opportunity to submit 
written testimony on behalf of the Immune Deficiency Foundation (IDF) 
regarding fiscal year 1999 appropriations for programs under the 
jurisdiction of the Subcommittee. My name is Joanne Bakken Pease, I am 
a volunteer with IDF's Washington State Chapter and I would like to 
tell you the story of my family's struggle with primary 
immunodeficiency diseases.
    My three sons and nephew have all been diagnosed with primary 
immunodeficiency diseases, which means that they were born with 
incomplete immune systems. In November 1985, my eldest son Curtis 
received his vaccine for measles, mumps and rubella. Curtis got the 
mumps from the vaccination in February 1986, and the doctor told me 
simply--these things happen. After three years of constant colds and 
pneumonia--Curtis was diagnosed with X-linked Agammaglobulinanemia. I 
was thankful when I learned there was treatment available for him. 
However, the treatment consisted of a very painful injection 
administered intramuscularly every ten days. This treatment, a pooled 
plasma derivative, replaced portions of his incomplete immune system. 
However, the pain involved caused this therapy to be a source of terror 
in our household, requiring four adults for administration.
    When my second son Jeff was ten months old we learned that he had 
contracted polio from the oral vaccine, signaling the presence of the 
same immunodeficiency. He was left with a withered right leg and a 
terribly deformed foot. Now both my beautiful boys received these 
painful shots. Three years later they both started getting their 
vaccine intravenously. Intravenous immune globulin was less painful and 
more effective, it reduced our infusions to once a month.
    Jeff has had six very painful orthopedic surgeries including, 
tendon transfers and releases, hip reconstruction, leg rotations and 
ankle repositioning. He is now ready for his seventh and eighth 
operations which will be complicated leg lengthenings. In addition, my 
nephew Joshua (born in 1988) and my third son Mitchell (born in 1990), 
were both born with XLA and have begun their treatments.
    Mr. Chairman, my children's lives are not what I had envisioned for 
them. Although we have learned to cope with the care necessary to keep 
them alive, the pain that I feel for the loss of my dream will never go 
away. We need to continue to focus on medical research so perhaps 
future generations will have the option of gene therapy and not have to 
suffer years of chronic care. In addition, we must continue to do 
everything we can to protect the nation's blood supply. To give you an 
indication of how important this is, our four boys receive a total of 
70 infusion per year!
    For fiscal year 1999, the Immune Deficiency Foundation recommends 
that the National Institute of Allergy and Infectious Diseases (NIAID) 
receive a 15 percent increase over last year. This percentage 
translates into $202.7 million over fiscal year 1998 and would bring 
NIAID's total appropriation to $1.55 billion. In addition, Mr. 
Chairman, I would like to make clear that although IDF strongly 
supports the concept of doubling NIH's overall budget in the next five 
years, we do not believe that these increases should come at the 
expense of other important Public Health Service programs.
    Finally Mr. Chairman, I would like to mention the important work 
being done at the Immune Deficiency Foundation on behalf of the 
approximately 40,000 people suffering from primary immune deficiency 
diseases. The Foundation, through a grant from NIAID, is developing a 
national registry of U.S. patients suffering from the most common 
immunodeficiencies. The registry is providing an important resource to 
physicians and investigators by giving them access to a more complete 
clinical understanding of these diseases. The clinical information 
contained in these registries will help determine the frequency of 
complications, long tem prognosis, and possibly open the gateway for 
gene therapy. I am very proud of the work of the Foundation, and I 
would like to express the need for these important initiatives to 
continue.
    Mr. Chairman, once again, thank you very much for the opportunity 
to submit written testimony on behalf of IDF. As you make your funding 
decisions regarding the fiscal year 1999 budget for NIAID I would ask 
that you please remember my boys.
                                 ______
                                 
                     National Institutes of Health
 Prepared Statement of Francis T. Ventre, President, Montgomery County 
                            [MD] Stroke Club
    My name is Francis T. Ventre. I am president of the Montgomery 
County [MD] Stroke Club, a nonprofit organization for stroke survivors 
and caregivers, mostly family members. This club consists of some 425 
members as well as 100 professionals--physicians, therapists, 
hospitals, retirement homes, units of government and other caregivers.
    Our members range in age from the twenties to the eighties. Some 
manifest little visible signs of stroke. Others either have lost the 
ability to speak or need assistance to walk, dress, bathe, and eat. 
More than 1 million in this land have disabilities from stroke.
    Let me tell you about my stroke. I was professor of architecture 
and city planning at Virginia Tech since 1983. In 1988, Macmillan 
signed me up to write on the subject of ``building regulation'' for The 
Dictionary of Art, the 34-volume exposition with 6,700 contributors it 
was planning to publish.
    In February 1990, when I was swimming at Virginia Tech's War 
Memorial pool, I was struck with a transient ischemic attack [TIA], or 
a mini-stroke. Two days later, at North Carolina Baptist/Bowman-Gray 
Hospital in Winston-Salem, I suffered a major stroke, a ``left cerebral 
infarct in the middle cerebral artery distribution following the 
spontaneous dissection of the right internal carotid artery during an 
angiogram.'' I was left with an ``mild Broca's aphasia with verbal 
aphasia: [or a ``language problem'' and a ``residual right 
hemiparesis,'' [or my right arm didn't work]. There was my stroke.
    I was home when I thought of the ``building regulations'' article I 
had to writes, so I resumed. The Dictionary of Art came out in October 
1996, and the New York Times Book Review came out in August 24, 1997. 
My ``building regulations''--along with two others--as cited as ``those 
sections among the most memorable precisely because they're 
unconventional, hence thought-provoking.'' That's my story.
    Stroke, the third leading cause of death in the United States, 
strikes 600,000 Americans each year, killing more than 157,900. Stroke 
is the leading cause of permanent disability in the United States. 
Thanks to medical research, today, there are about 4 million stroke 
survivors in the United States and I am one of them.
    What do stroke survivors face? They face years of severe physical 
and mental impairment, loss of memory, cognitive skills, personality 
disorders, emotional distress and overwhelming medical expenses. Stroke 
will cost this nation an estimated $43 billion in medical expenses and 
lost productivity in 1998. My own expenses were $18,000 at the Bowman 
Gray Hospital in Winston-Salem plus many more thousands of dollars at 
rehabilitation, including physical therapy, occupational therapy and 
speech-language pathology and many more thousands of dollars at the 
National Rehabilitation Hospital in Washington, DC, and the Treatment 
and Learning Center in Rockville, MD.
    There is one thing that I want you to know about National Institute 
of Neurological Disorders and Stroke researcher John Marler, M.D. It 
came from the November 24, 1997 copy of USA TODAY, headlined ``Overhaul 
Urged for Handling of Strokes,'' upgrading stroke to a ``time-
dependent, urgent medical emergency.'' The report, ``Rapid 
Identification and Treatment of Acute Stroke,'' describes how 
physicians, emergency care personnel and the public should respond to 
the finding that a drug called tissue plasminogen activator or t-PA, 
destroys the clots that dam up arteries, restoring blood flow to the 
brain. The drug t-PA, to be effective, must be given within 3 hours of 
the initial symptoms. Given in time, the drug improves the patient's 
chances of having minimal or no disability by 33 percent three months 
after surviving a stroke.
    I wish that the t-PA were available in 1990.
                                 ______
                                 
 Prepared Statement of Erin Bosch, on Behalf of the National Coalition 
                     for Heart and Stroke Research
    Mr. Chairman, honorable members of the Committee, I am honored to 
have the opportunity to speak to you today. My name is Erin Bosch. Some 
of you may recall that last year I addressed this Committee on behalf 
of the National Coalition for Heart and Stroke Research. Today, I am 
here to represent not only myself, but also, the 32,000 children in the 
United States who are born with congenital heart defects each year.
    Most of us are aware that heart disease is the No. 1 killer and a 
leading cause of disability in adults in this nation. But few recognize 
that heart defects are the most common birth defect of the newborn. Of 
the 32,000 children born each year with heart defects, about 2,300 die 
before their first birthday. The rest of us live with the consequences 
of heart disease, and many have their lives cut short from heart 
failure.
    Thanks to the past funding for heart research about 1 million 
Americans born with heart defects are alive today. While we are 
grateful for each day to be alive, we unlike other healthy children, 
have not been able to experience what it is like to run the length of 
the soccer field without struggling for our next breath, nor have we 
experienced the thrill of scoring the winning basket for our school 
basketball team.
    I was born with a genetic heart disease called Hypertrophic 
Obstructive Cardiomyopathy. This disease has caused the heart muscle to 
overgrow and block the blood flow in and out of my heart. It also 
effects the valves of my heart causing the blood to back up in the 
wrong direction. This disease causes high risk for heart attack and 
sudden death from dangerous heart rhythms.
    One year ago in October, I was at the Mayo Clinic having open heart 
surgery. The procedure, called a septal myectomy, is designed to shave 
away a portion of the heart muscle that causes the obstruction. This 
procedure was originally pioneered at the National Institutes of 
Health's National Heart, Lung, and Blood Institute and was my last 
resort aside from transplant.
    It is funding that this Committee has provided that has allowed 
this type of successful research. Without this funding the option of a 
healthier lifestyle would not have been possible for me. I am one of 
the lucky ones. My surgery was successful and after one month at the 
Mayo Clinic I was able to return home. There have been some advances 
for children like me, although many still die prematurely.
    Most people think heart disease is a problem that only affects 
older people. But, I am living proof they are wrong. According to 
recent studies, 36 percent of young athletes who die suddenly have 
undiagnosed Hypertrophic Cardiomyopathy. Presently, there are at least 
35 different types of recognized congenital heart defects effecting the 
newborn population. Some can be corrected surgically--others cannot yet 
be repaired and these children die. One of these children might one day 
be your child or grandchild.
    I have great faith in the determination of our scientific 
researchers who work day and night to find new treatment methods for 
those who suffer with illness and disease. I also have great faith in 
you as the doorkeepers of governmental funding for the National Heart, 
Lung, and Blood Institute to provide the necessary funds for children, 
who through no fault of their own, have been born with heart defects.
    Thank you for the opportunity to speak to you today. I am confident 
that you will not forget me and the other young people like me who 
depend on you for this funding and subsequent research. We, too, desire 
to live long, productive lives.
                                 ______
                                 
  Prepared Statement of Jack Lavery, Chairman of the Board, the Lupus 
                         Foundation of America
    My name is Jack Lavery, and while my full-time job is that of 
Senior Vice President of Merrill Lynch & Company, I am here today 
representing the Lupus Foundation of America as its Chairman of the 
Board. I am also representing the nearly 1.4 to 2 million Americans 
living with lupus. One of those people is my daughter.
    The Lupus Foundation of America is a national advocacy organization 
dedicated to finding the cause and cure for systemic lupus 
erythematosus, a chronic inflammatory disease in which the body's 
immune system fails to serve its normal protective functions and 
instead forms antibodies that attack healthy tissues and organs. In 
layman's terms, it is the body turning against itself. Lupus is 
incurable and extremely difficult to diagnose because, generally, no 
two people with systemic lupus have exactly the same symptoms. 
Moreover, it is a devastating illness. Thousands of Americans die each 
year from lupus-related complications. For those living with the 
illness, the disease wreaks havoc on their quality of life, with the 
side-effects for current treatments of lupus-related problems often 
causing worse problems than the disease itself.
    Lupus is often called a ``woman's disease'' because 90 percent of 
lupus patients are women. The relative incidence of lupus is even 
greater among African American, Asian American, and Hispanic females 
than among Caucasian females. A market research study conducted by the 
Lupus Foundation of America in 1994 showed that as many as 1 out of 
every 102 women, as well as 1 out of every 62 women of color, may have 
lupus. Lupus can therefore be seen as a diversity issue in 1998.
    The Lupus Foundation of America wishes to thank you, Mr. Chairman, 
and the members of this committee for your leadership role in ensuring 
the continuation of research on the immune system at the National 
Institutes of Health and, in particular, the National Institute for 
Arthritis, Musculoskeletal and Skin Diseases (NIAMS). We want the 
Subcommittee to understand how important such high quality research on 
immune dysfunction is to those with lupus. I therefore urge the members 
of this committee to support funding for the NIAMS at the $315.9 
million dollar level recommended by the Ad Hoc Group for Medical 
Research Funding and supported by the NIAMS Coalition. This level of 
funding represents a fifteen percent increase over last year's funding 
and would be a significant step toward recognizing the importance of 
increasing medical research funding. This level of funding is crucial 
for three reasons.
    First, it is a pivotal time for lupus research. The outlook for 
lupus patients has improved in some respects over the last two decades, 
but the side effects of the conventional treatments can ultimately be 
as dangerous as the disease itself. Better diagnostic techniques and 
evaluation methods have given physicians the tools to manage lupus 
symptoms and complications more effectively. However, a cure is still 
not within our reach. While scientists believe there is a genetic 
predisposition to the disease, environmental factors--such as 
infections, ultraviolet light, the sun, stress, and certain drugs--are 
also thought to play an important role in triggering lupus. We must 
know what causes lupus before we can develop a cure, and this is where 
research plays a critical role.
    NIAMS funds many individual researchers across the United States 
who are studying lupus. To help scientists gain new knowledge, NIAMS 
has also established Specialized Centers of Research devoted 
specifically to lupus research. In addition, NIAMS is funding a lupus 
registry that will gather medical information as well as blood and 
tissue samples from patients and their relatives. This will give 
researchers across the country access to information and materials they 
can use to help identify genes that determine susceptibility to the 
disease. Promising areas of research include identifying the lupus 
susceptibility genes, searching for environmental agents that cause 
lupus, and developing drugs or biologic agents that cure lupus.
    Recently, researchers at the University of California at Los 
Angeles, with funding from NIAMS, the NIH Office of Research on Women's 
Health, and the Lupus Foundation of America, have identified the 
location of a gene that predisposes people to systemic lupus across 
ethnic groups. This discovery and others like it provide important new 
insights on why people get the disease and may help researchers develop 
new treatments. It is a significant and positive step toward finding a 
cause for lupus--a breakthrough where additional research is still 
critical.
    In November 1997, the National Institutes of Health, the SLE 
Foundation, and the Lupus Foundation of America were among several 
cosponsors of a historic scientific conference entitled Novel 
Perspectives on Systemic Lupus Erythematosus: From Basic Research to 
Clinical Applications. The conference represented a significant 
recognition of the importance of continuing new research which will 
hopefully lead to important clinical applications for lupus patients.
    Second, I believe lupus is the prototype for autoimmune diseases, 
as well as for the management of chronic disease more generally. 
Research on lupus, therefore, has far-reaching consequences. Any 
insight we can gain from high quality research on immune dysfunction 
could provide important information on other autoimmune diseases and 
could potentially reveal new and different ways to control other 
chronic diseases.
    Finally, LFA research indicates that as many as 2 million Americans 
report having been diagnosed with lupus. This year, we estimate that 
many thousands of people will call our organization's hotline. Most of 
the callers are individuals recently diagnosed with lupus or their 
family members who seek answers to questions about this disease. Only 
through further research will we find ways to improve both the 
prognosis and the quality of life of the many people living with lupus, 
including my own daughter, Dena.
    Dena developed lupus at the age of 13, although it was initially 
incorrectly diagnosed as juvenile rheumatoid arthritis and then as 
vasculitis, a non-specific inflammation of the blood vessels. At 19, 
she was finally correctly diagnosed with systemic lupus. She is 29 now. 
She has been close to death at least twice and has permanently lost her 
vision in one eye as a result of lupus-related optic neuritis.
    The side effects of treatments for lupus are often as devastating 
as the disease itself. As in my daughter's case, protracted use of 
steroids can cause osteonecrosis (i.e. bone death). She also has had to 
undergo multiple core decompressions in an attempt to regenerate blood 
vessel growth. These involved individual operations drilling her left 
and right knees, left and right hips, and left elbow. Though at an age 
when most of her peers do not even have to think about such operations, 
my daughter has now also had surgery for a bilateral hip replacement 
(i.e. two prosthetic hips). Lupus is active in her kidneys, and her 
treatment has involved the toxic chemotherapy drug cytoxan. The side 
effects of this drug can grow cumulatively with protracted use and can 
include sterility, bladder cancer, and lymphoma.
    I am proud to say that, despite these setbacks, my daughter has 
moved forward with her life like a true fighter and is currently a high 
school English teacher. She is an example of the courage of the many 
Americans who fight lupus everyday.
    Last year, members of the Lupus Foundation of America and its many 
chapters spent a significant amount of time raising funds which are 
used to fund our own research, education, and support programs. 
However, the amount of funds lupus patients and their families can 
raise on their own is limited and relatively small compared to what is 
needed. Federal support of medical research in general is critical if 
we are to find a cause and a cure for lupus and other autoimmune 
diseases. The Lupus Foundation is committed to developing and 
maintaining a partnership between the private and public sectors on 
lupus research. Only through such a collaboration can we ensure that 
the highest-quality research is conducted and leads to a cure for this 
devastating disease.
    In summary, funding of lupus research is critical because we are at 
a pivotal time in lupus research; research on lupus could benefit those 
suffering from other autoimmune and chronic illnesses; and, finally, 
many thousands of Americans suffer a decreased quality of life due to 
the devastating nature of this disease. The Lupus Foundation of America 
is committed to push for federally supported research dollars which 
will yield answers to this mysterious disease. I cannot stress enough 
the importance of your support so that research on autoimmune 
dysfunction continues without interruption. Thank you for your 
attention, and my daughter also thanks you, as I'm sure all lupus 
patients and their families do.
    The Lupus Foundation of America neither receives grants or 
subgrants from the Federal Government nor has any contracts or 
subcontracts with the Federal Government. Through the generosity of 
Federal employees throughout the United States and around the world, we 
receive contributions of approximately $500,000 per year through the 
Combined Federal Campaign.
                                 ______
                                 
Prepared Statement of Lorne M. Mendell, Ph.D., on Behalf of the Society 
                            for Neuroscience
    Mr. Chairman, my name is Dr. Lorne M. Mendell. I am the president 
of the Society for Neuroscience and a professor at the Department of 
Neurobiology and Behavior at the State University of New York at Stony 
Brook. I am testifying on behalf of the Society for Neuroscience, the 
largest scientific organization in the world dedicated to the study of 
the brain and spinal cord. The Society for Neuroscience consists of 
more than 28,000 basic and clinical neuroscience researchers affiliated 
with universities, hospitals and scientific institutions throughout 
North America and abroad. Mr. Chairman, we are very grateful for this 
opportunity to give our testimony, and I want to express our gratitude 
to this Subcommittee, and especially to you Mr. Chairman, for the high 
priority you have placed on continued funding for biomedical research 
at the National Institutes of Health.
    The field of neuroscience, only a quarter of a century old, has 
already made major contributions to the welfare of our nation's 
citizens. New insights and effective treatments have been developed for 
previously hopeless diseases. For example, current research has allowed 
us to understand mechanisms of pain so that various remedies may be 
developed for burn victims, arthritis sufferers, and many others to end 
unnecessary pain and suffering. Without adequate funding, our fight 
against neurological diseases and disorders such as Alzheimer's, 
Parkinson's, mental retardation, stroke, severe depression, 
schizophrenia, and spinal cord injury, to name just a few, would suffer 
a serious setback.
    We at the Society for Neuroscience are extremely grateful that this 
Subcommittee is committed to supporting our work by increasing funding 
for NIH; your efforts are truly appreciated. We were especially 
pleased, Mr. Chairman, by your efforts last year concerning fiscal year 
1998 appropriations. We know that with your leadership on this 
Subcommittee, biomedical research has a champion in the Senate and know 
that you will strongly support NIH for fiscal year 1999. We fully 
support the goal of doubling the budget of NIH over the next 5 years, 
as has been advocated by many in the Congress.
    We have at our fingertips the necessary tools and resources to make 
significant progress in our fight to cure neurological diseases and 
disorders; all we need are the necessary funds to build upon what we 
already know. Twenty years ago, the field of neuroscience was little 
known to the general public. Now, every one of us knows someone who 
suffers from some type of neurological problem. In addition to personal 
experience through our family and friends, we see everyday when we open 
up a magazine, or turn on the television, that too many people are 
suffering from neurological disorders. We at the Society have become 
more involved with our patient advocacy groups, as they are the people 
who are truly affected by our research. After hearing from them, we 
learn of their day-to-day struggles. As researchers, patient advocacy 
groups and members of Congress work together, the nation will become 
more familiar with the progress that is occurring in our labs and will 
recognize that funding is still needed to expand upon what we already 
know. If we can double the budget of NIH, we can change some of these 
sad, and all too-familiar stories, into medical success stories.
    Brain diseases affect more than 50 million Americans annually at 
costs exceeding $400 billion in direct costs for clinical care and in 
lost productivity. The more than 1,000 disorders of the brain and 
nervous system result in more hospitalizations than any other disease 
group. The prevalence of brain disorders in the United States, together 
with high annual costs for treatment, combine to make these conditions 
the number-one public health problem now confronting this nation.
    But there is good news that needs to be told, and as I've said, we 
are making progress. The cost- effectiveness of investing in biomedical 
research has been proven as there are many examples of cost savings 
from research conducted at NIH. A few examples of the estimated annual 
economic costs of several diseases include stroke ($40 billion), 
Alzheimer's disease ($90 billion) and all mental disorders ($148 
billion). In addition to improving people's lives by seeking cures for 
these and other diseases, we can also save money in the long run if we 
invest now. In the mental illness field, consider patients diagnosed 
with schizophrenia. A drug, clozapine, has enabled schizophrenic 
patients to leave hospitals earlier than in the past and in some cases 
even return to work. These cost savings total $23,000 per patient 
annually, which translates into an approximate overall savings of $1.4 
billion annually. Another example includes lithium therapy for manic-
depressive illness, which has saved the U.S. economy more than $145 
billion since 1970, over $5 billion per year. In addition to these 
examples of mental illness, one can also look to the progress being 
made in stroke research. About 400,000 people suffer from strokes 
caused by blockage of blood flow (ischemic stroke) each year. Patients 
who endure ischemic strokes and who receive emergency treatment with 
the clot-dissolving drug t-PA within three hours of the start of their 
symptoms are 30 percent more likely to survive a stroke with little or 
no disability. A soon-to-be-published analysis of the economic benefits 
of using t-PA shows that when the drug is appropriately used, there is 
a considerable decrease in the long-term care costs of stroke, 
particularly costs of nursing home and rehabilitative care. A final, 
more general example, involves drug abuse. For every dollar spent on 
drug use prevention, communities can save $4 to $5 in costs for drug 
abuse treatment and counseling. These are just a few examples, and it 
is important to note that NIH is working on an economic analysis that 
will be available in the near future that highlights even more areas of 
cost savings.
    We at the Society for Neuroscience realize the difficulty in 
finding money for biomedical research. However, modern neuroscience is 
on the threshold of making important scientific breakthroughs in a 
number of brain diseases, which, for centuries, have perplexed 
clinicians and ravaged those affected. To lose this momentum now would 
be detrimental for the health of the nation, to say nothing of its 
economic health. This makes increased investment in neuroscience 
research not only an absolute necessity, but among the highest 
priorities for the appropriations made by this Subcommittee. We feel 
that it is vital that the necessary funds are appropriated to continue 
to achieve the tremendous advances and breakthroughs that are within 
our reach. It is our hope that funding for all biomedical research will 
be increased, as discoveries at one Institute carry over to work being 
done by other Institutes at NIH. The main goal is to increase funding 
overall, so that further progress can be made in the hopes of ending 
these debilitating disorders and diseases.
    Thanks to this Subcommittee's dedication and hard work, biomedical 
research has become a priority in this nation. When this Subcommittee 
increased funding at NIH for fiscal year 1998, you let us know that you 
were doing everything possible to see that our goals are reached. It is 
encouraging for our members to know that they have the support of the 
Senate Appropriations Subcommittee on Labor-HHS. With this in mind, the 
members of the Society for Neuroscience will continue to work 
diligently to continue making progress in research in the neurosciences 
to benefit the health and well-being of the American public.
    It is for these reasons, that we recommend a 15-percent increase 
over fiscal year 1998 for NIH. We support the proposal of the Ad Hoc 
Group for Medical Research Funding, made up of approximately 200 
patient and voluntary health groups, medical and scientific societies, 
academic and research organizations and the biotechnology industry, 
which are dedicated to the future of the nation's biomedical and 
behavioral research. Our recommendation calls for a 15-percent increase 
as a first step toward doubling the NIH budget over the next 5 years. 
We recognize the difficulty in achieving this goal under current 
spending limits, and encourage the Congress to explore all possible 
options to identify the additional resources needed to support this 
increase.
    In conclusion, the Society for Neuroscience is grateful for this 
opportunity to present testimony to this distinguished Subcommittee. We 
encourage members of the public and the Subcommittee to visit Brain 
Briefings, our monthly newsletter, on our Web site (http://www.sfn.org/
briefings/) to learn how basic neuroscience discoveries lead to 
clinical applications. This testimony is also available on our Web site 
(http://www.sfn.org/legislative/index.html).
    Thank you again for your continued support.
                                 ______
                                 
     Prepared Statement of Tish Tanski, President, Association of 
                    Independent Research Institutes
    On behalf of the Association of Independent Research Institutes, I 
am pleased to submit this statement to the Subcommittee on Labor, HHS, 
Education and Related Agencies of the Senate Committee on 
Appropriations regarding the fiscal year 1999 proposed budget for the 
National Institutes of Health.
    AIRI is an association of 85 not-for-profit, independent research 
institutes that conduct basic and clinical research in the biomedical 
and behavioral sciences. Our members receive about 10 percent of the 
extramural funds awarded by the National Institutes of Health (NIH), as 
well as a significant proportion of National Science Foundation awards. 
AIRI institutes also receive funding from other federal agencies, 
including the Centers for Disease Control, Department of Energy, and 
the Department of Defense, as well as from voluntary health agencies, 
private foundations, and corporations.
    AIRI members are distinct from other organizations involved in 
research--such as universities, hospitals, and for-profits--in their 
organization, mission, and size. They are independent; their primary 
mission is research; and their institutes tend to be relatively small 
in size--with budgets from less than $1 million to many tens of 
millions of dollars.
    Over the past few years, this subcommittee could have sacrificed 
NIH funding in the name of deficit reduction or for other subcommittee 
priorities. But instead, you stood firm in your support of NIH and its 
mission. Now, we ask you to demonstrate your support for the work of 
NIH once again--by providing a 15-percent increase in funding for 
fiscal year 1999, as called for by the Ad Hoc Group For Medical 
Research Funding. Such an increase is an essential first step in 
realizing the goal of doubling the NIH budget over the next five years.
    As a direct result of this subcommittee's support over the last 
decade, an ever-expanding base of scientific knowledge about health and 
disease is being developed, a base that has already begun to 
revolutionize both the concept of scientific inquiry and the practice 
of medicine. AIRI supports the Ad Hoc Group's position that sustained 
growth in funding for the NIH is needed to build upon past scientific 
achievements, address present medical needs, and anticipate future 
health challenges. Volatility and dramatic fluctuations in support 
levels can be as harmful to the enterprise as inadequate growth rates.
    Strong, steady growth for the NIH budget is needed not merely to 
continue at an accelerated rate the science and the tools of the past 
decade. The fundamental way science is conducted is changing at a 
revolutionary pace. It requires investment in new technologies, new 
infrastructure, and personnel with new sets of skills. The higher level 
of investment is necessary to ensure that the research community can 
maximize these fundamentally new approaches to discovery.
    AIRI institutes perform biomedical and behavioral research of the 
highest quality. Our researchers have a significantly higher than 
average success rate in competing for NIH research project grants. Our 
institutes understand what has been accomplished with NIH support, and 
we know how much more could be done with additional NIH funding.
    Here are just a few examples of the biomedical and behavioral 
sciences work in which AIRI institutes--with critical support from the 
National Institutes of Health--are taking the lead:
    At the Whitehead Institute for Biomedical Research in Cambridge, 
Massachusetts: Dr. Peter Kim and his colleagues produced the first 
high-resolution picture of the protein fragment that enables HIV (the 
AIDS virus) to invade human cells--work that has immediate implications 
for new drug design.
    At the Oklahoma Medical Research Foundation in Oklahoma City: 
Researchers have been able to establish a powerful association between 
Epstein-Barr Virus (EBV) and lupus, a serious autoimmune disorder.
    At the Neuropsychiatric Institute in Fargo, North Dakota: 
Researchers are evaluating the importance of taste preference in 
determining the vulnerability to substance abuse.
    At the John B. Pierce Laboratory in New Haven, Connecticut, 
researchers are working to determine:
  --The means by which cells lining the blood vessel walls communicate 
        with each other to convey messages about blood flow control--
        thus acting to prevent blockages leading to stroke;
  --The source of production of nitric oxide in lungs during 
        infection--which acts to dilate lung airways and thus act to 
        prevent adult respiratory distress syndrome; and
  --The biological basis for the increased resistance to chronic 
        diseases such as myocardial infarction, stroke, and diabetes 
        conferred by increased physical activity in older people.
    On behalf of the AIRI membership, I want to extend our appreciation 
to you and the members of the Subcommittee for your support of NIH and 
its missions. We hope you will consider our statement in strong support 
of a 15-percent increase for NIH as you prepare the fiscal year 1999 
Labor, HHS, Education and Related Agencies appropriations bill.
    Thank you for your consideration of AIRI's views on the NIH budget.
                                 ______
                                 
   Prepared Statement of Gloria E. Reich, Ph.D., Executive Director, 
                     American Tinnitus Association
    I represent the American Tinnitus Association and speak for more 
than 50 million people in this country who have tinnitus and especially 
for the 300,000 people who have contacted our organization for help. 
These people for the most part consider this hearing problem, tinnitus, 
to be a major deterrent to normal living. Imagine, if you will, 
listening to sounds like ringing, hissing, roaring or clicking within 
your head for 24 hours a day for the rest of your life.
    Tinnitus is most commonly caused by exposure to loud noise. It 
often goes along with hearing loss and thus, formerly, was thought to 
be a condition afflicting the elderly. Today's generation of hearing 
damaged people in their thirties and forties forces us to rethink that 
position and we now realize that tinnitus is a condition that can 
adversely affect the lives of people of any age.
    Every day our mail brings hundreds of requests for help. Perhaps 
this brief sampling of letters will help you understand the distress of 
this invisible condition.
    ``I received your letter concerning tinnitus and I thank you so 
much. I don't know who to turn to or what to do. I have spent almost 
all of my savings on paying doctor bills that my insurance didn't 
cover.'' I have lost friends over what I have, my family still finds it 
hard to believe I have tinnitus. I don't know anyone with tinnitus and 
my family and co-workers have never heard of it. This sizzling in my 
ears seems to be getting worse. When I couldn't work for 2\1/2\ months 
people thought I was crazy. I was scared and still am.'' (SD, female, 
age 46)
    ``I received your magazine Tinnitus Today and I look forward to 
receiving it. I have tinnitus very bad. Many times I thought of ending 
my life as sometimes it is unbearable. I've gone to so many ear, nose 
and throat doctors and spent so much money on help. They treat my 
sinuses or prescribe Niacin or other vitamins that don't help. I had 
CAT scans too. I've tried everything I can find but with no relief. I 
hope some help is on the way.'' (CN, female, age 75)
    ``I am writing to you in total desperation. My father has tinnitus 
and it has become progressively worse in the last year. We have tried 
going to ear, nose and throat specialists, numerous other doctors, 
including neurologists, but with no luck. My father's health is 
deteriorating each day as the ringing is constant. It has been loud and 
constant for him for the past 6 months. He hardly ventures out of bed 
anymore. He is also blind which makes it that much worse. Please, 
please I am begging you not to disregard this letter. You are probably 
our last attempt at some kind of help or support. I am afraid that I 
may lose my father because of this ``crazy'' problem.'' (JC, from 
Delaware; family was referred to well established tinnitus support 
group and audiologist at Greater Baltimore Medical Center)
    ``My name is Bob and on many occasions when my ears were ringing 
real bad I thought of killing myself. I didn't as somehow my conscience 
wouldn't let me. But now this ringing is in my left ear as well with a 
different sound from the right one. Most of the time these sounds are 
so loud I lose my balance and my sense of direction and forget 
everything. My doctors tell me to bear with it, don't worry, and 
everything will be alright. They can't understand what its like unless 
they have it too. Maybe then they would help!'' (RH, male, from 
Nebraska)
    ``I am 39 years old and the thought of living with this the rest of 
my life is more than I can handle. I have to deal with this ringing 
that is literally driving me insane. I can't sleep and I can hardly 
concentrate at work.'' (LP, female from Florida)
    ``My life is in shambles because of the intensity of ringing in my 
ears. It has left me without a job. I cannot study or work well at 
anything. (PT, male from Texas)
    ``I am a registered nurse and have been fired from my job and 
labeled professionally incompetent because I have tinnitus. They 
implied I was mentally ill because I described these head noises. 
Absolutely nothing was done at work to accommodate my handicap in spite 
of my good reputation as a nurse.'' (HL, 60 yr. old female from New 
Mexico)
    ``I've tried to continue my job which I have had for over twenty-
six years, but I had to give it up after four months of overwhelming 
stress from the intense ringing in my ears. I can't sleep and my 
physical condition is weakening.'' (JD, male)
    ``In the course of the last seven years of suffering with tinnitus, 
I've lost my job of seventeen years, my automobile, life and health 
insurance, real estate, money, and a considerable portion of my sanity. 
It is with much hope that I appeal to you for help.'' (AP, male, from 
California)
    ``My life has become a horror story since I cannot find any peace 
and it has become impossible for me to function normally. I have been 
submerged into depression because my quality of life is altogether 
gone. I cannot even concentrate at work.'' (FB, 37 year old male from 
California)
    ``I am an electronics engineer and my home life and job are in 
jeopardy. I have had the ringing for some time but it has gotten worse 
to the point where I can no longer read effectively or concentrate for 
any length of time.'' (JV, male, from Connecticut)
    Many celebrities have been identified as having tinnitus but few of 
them have been willing to speak out. Tony Randall has spoken about his 
tinnitus both on television and before the Senate Appropriations 
subcommittee. William Shatner told the House subcommittee of acquiring 
tinnitus while on the set of Star Trek. ``Rock'' musicians are 
particularly susceptible to hearing loss and tinnitus; Pete Townshend 
of ``The Who'', and Mickey Hart of the ``Grateful Dead'' are just two 
who have identified themselves as having ``musical self-inflicted 
tinnitus''. Bob Hope and Al Unser have it as does Barbara Streisand and 
Lisa Minelli. Even former President Reagan and former first lady 
Rosalyn Carter experience tinnitus. Needless to say, many veterans have 
tinnitus from the loud noises of artillery fire and heavy equipment. 
The Veterans Administration spends some $90 million a year in 
compensation for tinnitus. Airplane pilots and drivers of large trucks, 
railroad workers, steelworkers, automobile body builders, miners, 
farmers who drive tractors, even housewives who run vacuum cleaners, 
lawnmowers and other household equipment have found their hearing 
damaged by loud sounds.
    ATA along with other hearing related organizations worked for the 
establishment and funding of the National Institute on Deafness and 
Other Communicative Disorders. Along with our joy at seeing the new 
institute underway came the dismay of once again seeing tinnitus take 
the hindmost with respect to research project funding even though 2\1/
2\ times as many Americans suffer from tinnitus as have hearing loss. 
We were, however, nothing if not optimistic and hoped that research 
about tinnitus would increase. Our patience was rewarded when the NIDCD 
held a tinnitus workshop in 1995 and subsequently funded nearly $1 
million in studies. Those studies have spawned more, and this year the 
NIDCD awarded a larger grant of $1.5 million for tinnitus research. 
There'll be another workshop this year too, for refining goals and 
defining projects. We're satisfied with this good beginning, but we're 
hopeful that it is only a beginning and that more funding and more 
research will bring the cure that tinnitus sufferers want and deserve. 
ATA has done its share as well. Over the last 17 years we've given more 
than one million dollars for tinnitus research. The six latest of these 
projects have provided the pilot data required by the NIDCD for 
tinnitus studies they have been funded over the last 2 years. In spite 
of these great strides people ask us all the time why can't progress 
come more quickly.
    Allow me to cite an example. In 1937, Robert Lewy reported tinnitus 
relief for varying lengths of time and in varying types of tinnitus 
through the use of procaine hydrochloride. It took 40 years for 
researchers to stumble on a similar effect with a comparable drug, 
lidocaine. Now, it has been another 20 years and although there have 
been more than 40 studies since the late 1970's about these types of 
drugs and their effect on tinnitus, nothing clinically useful has 
emerged. The medical community generally concedes that intravenous 
lidocaine suppresses or stops tinnitus in almost all cases. In the 
early 1980's an oral analog of lidocaine called tocainide (Tonocard) 
was developed and tested with disappointing results. Since then little 
if any progress has been made toward further investigations to isolate 
the critical ingredient in lidocaine that has a positive effect on 
tinnitus. Can you see why people with tinnitus find it so frustrating 
when their problem is either ignored or trivialized by the medical 
community? Admittedly, tinnitus itself is not life threatening, in fact 
people with tinnitus may look the perfect picture of health. The 
letters and telephone calls we receive, however, confirm that a large 
number of people with tinnitus experience significant stress which 
interferes with their lives and their ability to work and to interact 
socially.
    People with tinnitus want help in their lifetime. They are 
experiencing a problem which has high social costs for our country. A 
small survey in the mid-80s revealed that about 14 percent of those 
with tinnitus had to change jobs or quit working because of it. 14 
percent of the estimated 50 million cases is 7 million people who are 
no longer productive members of our society. You, as legislators, look 
for ways to trim costs of government. Here is a classic example of how 
money spent for research and treatment development can directly effect 
the economy. If tinnitus could be alleviated, these people would be 
able to resume working, become contributing members of society, and 
experience a better life.
    The people who are suffering have told their story far better than 
I can. Hear their plea and help them by funding significant tinnitus 
research through the National Institute on Deafness and Other 
Communication Disorders.
                                 ______
                                 
     Prepared Statement of Jeffrey Kern, M.D., President, American 
                    Federation for Medical Research
    Thank you for the opportunity to present formal testimony to your 
subcommittee. The American Federation for Medical Research (AFMR) is a 
national organization of 7,000 physician scientists--primarily medical 
school faculty members--engaged in basic, clinical, and health services 
research.
    The AFMR wants to express its deep appreciation for this 
Subcommittee's strong support for the National Institutes of Health. We 
are encouraged by proposals introduced in the House and Senate to 
double the NIH budget over the next five years. However, it is 
important to assure that a significant portion of these additional 
funds be allocated to much needed initiatives to strengthen NIH 
extramural clinical research programs. We commend Subcommittee Members 
Cochran and Reid for their leadership in sponsoring H.R. 3001, the 
Clinical Research Enhancement Act, authorizing additional funding for 
new clinical research career development and research project awards. 
Unfortunately, while we await enactment of this legislation, American 
clinical research continues its decline. The AFMR urges this 
Subcommittee to move forward this year and propose additional NIH 
funding to revitalize our nation's clinical research effort.
               the problems confronting clinical research
    Through clinical research, basic science discoveries are applied to 
the study of human physiology, to research on a disease or condition, 
or to the initial study of a potential therapeutic intervention. 
Sometimes referred to as ``translational'' or ``integrative'' research, 
clinical research leads to the ultimate dividend of the NIH investment 
in basic science: improved methods of preventing, treating or curing 
disease and disability. Challenges to clinical research slow progress 
in medicine. Accordingly, it is critically important that steps be 
taken immediately to address the problems confronting clinical 
researchers and their patients. These include:
  --The loss of a generation of young clinical investigators faced with 
        enormous medical school tuition debts and the absence of 
        structured, well-supported training and career development 
        programs;
  --The inability of academic medical centers to sustain internal 
        mechanisms of support for clinical research because of cost-
        containment required by fierce competition in the health care 
        marketplace; and
  --The declining infrastructure for clinical research, most notably 
        the insufficient funding provided to the NIH-funded General 
        Clinical Research Centers.
    It should be noted that private industry provides significant 
support for clinical research and clinical trials aimed at the 
development of new products. However, funding is extremely limited for 
clinical research that may not offer a product ``pay off.'' In the 
past, this research was subsidized internally by our nation's academic 
medical centers. However, competition and cost-containment have all but 
eliminated the ability of these institutions to continue as the 
principal funders of early-stage translational research. Today, and for 
the foreseeable future, such research requires NIH funding.
    In addition, of course, NIH funding is critically important for the 
training and career development of clinical investigators. Our major 
difficulty in mounting and continuing major studies across the nation 
is the inability to recruit and sustain a sufficient cadre of clinical 
investigators to oversee the effort and interact with the patients. 
Steps must be taken to initiate a virtual crash program for the 
training of clinical investigators.
               solutions to the clinical research crisis
    The challenges confronting clinical researchers and their patients 
have received much attention but little action over recent decades. Of 
particular importance, in September of 1994, the Institute of Medicine 
of the National Academy of Sciences published a report on the 
opportunities and challenges confronting clinical research. The IOM 
recommendations are the foundation of the Clinical Research Enhancement 
Act (H.R. 3001). More recently, in December of 1997, the NIH Director's 
Advisory Committee on Clinical Research presented its report offering 
similar recommendations. Attachment 1 is a side-by-side analysis 
demonstrating the close concurrence between H.R. 3001 and the Advisory 
Committee's recommendations.
    The AFMR believes that this Subcommittee must take action to 
provide additional funding for the initiatives that have been 
recommended by the Institute of Medicine, the NIH Director's Advisory 
Committee, and the 140 organizations that support H.R. 3001. This would 
require an additional $60 million--less than half of a percent of the 
NIH budget--to fund these initiatives including:
  --$1 million to expand the existing NIH loan repayment program for 
        intramural scientists to include physician-scientists in the 
        extramural community;
  --$3 million to support grants to fund Masters' and Ph.D., programs 
        in clinical investigation;
  --$3 million for the creation of a 5-year career development award 
        for clinical researchers; and
  --$52.5 million to establish an ``innovative medical science awards'' 
        program.
    In addition, the AFMR urges this Subcommittee to take steps to 
increase substantially funding for the NIH-sponsored General Clinical 
Research Centers across the country. These ``safe havens'' for clinical 
research are vitally important. As noted in the Institute of Medicine 
report, funding for the GCRCs has not kept pace with NIH-wide budget 
growth in recent years. The importance of the GCRCs is emphasized in 
the report of the NIH Director's Advisory Committee for Clinical 
Research:
    The GCRC program has been highly successful and has contributed 
significantly to clinical research. It provides one of the few 
government mechanisms that allows for quick turn-around of small-scale 
pilot clinical studies. The Panel considers that the importance of the 
GCRCs to the national clinical research enterprise, both as 
infrastructure for the conduct of research and for the education and 
training of clinical researchers, cannot be overemphasized. It believes 
that the NIH should increase its financial support for these important 
centers.
    Last year, in the report accompanying the fiscal year 1998 
appropriations bill, this Subcommittee expressed concern about the 
reductions made in GCRC grants below advisory council-approved budgets. 
The Subcommittee requested a report from the National Center on 
Research Resources (NCRR) as to the funding necessary to bridge this 
gap. For fiscal year 1999, the AFMR recommends a budget increase for 
the GCRCs sufficient to:
  --Bridge the average 25 percent cut below Advisory Council approved 
        budgets for the GCRCs (estimated $30-40 million);
  --Cover the cost of increased hospital ancillary expenses as well as 
        the increased complexity of illness for patients seen in GCRCs 
        ($10 million);
  --Fund three additional centers ($5 million);
  --Expand the Clinical Associate Physician and Minority Clinical 
        Associate Physician training programs in the GCRCs ($2 
        million); and
  --Expand the GCRC clinical scholars program ($0.5 million).
    In summary, to enable the GCRCs to maintain the vital clinical 
research programs of academic medical centers, the GCRC budget should 
be increased from $167 million to a level of at least $215 million.
    As you consider our proposal for specified additional funding for 
clinical research initiatives, please keep in mind that such funds 
would not be directed to particular diseases or investigators. These 
funds would go to peer reviewed proposals to translate basic scientific 
discovery to the study of any disease. Rather than special interest 
set-asides, these initiatives are more comparable to the Subcommittee's 
directives to fund the extramural facilities construction program and 
the new clinical research center on the NIH campus. They will advance 
the goals of the NIH as a whole, will benefit all NIH Institutes and 
Centers, and will boost existing NIH efforts focussed on women's 
health, minority health, and prevention.
    Improvements in patient care and the prevention of disease depend 
on clinical research that brings basic scientific discoveries to the 
benefit of human beings. The fruits of clinical research are often 
taken by industry and developed into new drugs, vaccines, or health 
care products. These new products boost our economy and create jobs. 
The international implications of allowing clinical research to falter 
are enormous. We are beginning to see signs that other nations are 
picking up the clinical research banner that America is dropping. 
Please do not delay further. Just as you have moved forward to rebuild 
the clinical research capacity on the NIH campus, please move forward 
this year with much-needed investment in the extramural clinical 
research capacity of our nation's academic medical centers. I would be 
happy to respond to questions.
                                 ______
                                 
Prepared Statement of Christine Stevens, Secretary, Society for Animal 
                         Protective Legislation
    The first time I heard a proposal by an NIH official for funded 
retirement of research chimpanzees was around 1980 at an NIH symposium. 
This sound, humane suggestion was slow to take root, but now the 
National Academy of Sciences has given it authoritative consideration. 
The vast majority of the NAS committee rejected euthanasia as a 
solution and advocated a sanctuary for the chimpanzees who have 
completed their research service. On behalf of the Society for Animal 
Protective Legislation, I request funding in the amount of $50 million 
to make possible the erection of a chimpanzee retirement sanctuary.
    The housing of retired chimpanzees in a sanctuary will reduce 
government expenditures for those same chimps. The reason for this is 
that a comfortable and easily maintained building with access to the 
outdoors is less costly than keeping chimpanzees singly caged in 
existing buildings which are mainly in cities where rent and 
maintenance are high. The Institute for Laboratory Animal Resources 
(ILAR) cites a per diem cost for chimp maintenance of $15 to $20. This 
can readily be reduced to $10 a day in a sanctuary setting. ILAR 
estimates that there are 1,000 chimpanzees now living in institutions 
in different parts of the country who have been retired from research. 
A capable Animal Technician familiar with the care and handling of 
chimpanzees receives on average $30,000 a year. ILAR estimates that 
such an individual can now handle the care of 10 to 12 chimpanzees. In 
a sanctuary setting where the animals would be much more at ease, a 
well-trained Animal Technician would be capable of caring for as many 
as 24. In other words, the cost to government would be cut in half.
    I would like to quote a paragraph from an article in Laboratory 
Primate Newsletter, a synopsis of an article in the Journal of Medical 
Primatology by leading experts, including Jane Goodall and Michael 
Balls. The statement reads: ``It is now generally accepted that 
chimpanzees must be retired at the end of their involvement in 
research, to live under conditions which provide for their social and 
psychological well-being, for the remainder of their 40-50 year life 
span. For this reason, no experiment should be carried out unless the 
supporting agency has guaranteed to provide the funds necessary for 
such retirement. Such funds must be kept in a secure annuity account. 
At present, approximately $30,000 to $60,000 per chimpanzee are 
standard charges for this purpose.''
    A coalition of animal protective groups are doing their best to 
raise funds for the needed sanctuary. However, the cost is such that it 
is vitally important that the government contribute substantially in 
order to make it a reality. Plans have been drawn up and are available 
from Carole Noon, Project Director of The Institute for Captive 
Chimpanzee Care and Well-Being.
    The reason why there are so many chimpanzees being held by 
scientific institutions in the United States relates to the original 
expectation that they would be important to AIDS research. That 
expectation has not developed. However, there are many chimpanzees that 
have been used for studies of hepatitis and other diseases, and also 
the Air Force chimpanzees which have been declared ``surplus'' to any 
current needs of the U.S. Air Force. A serious problem exists with 
respect to these particular animals because of potential donation of 
them to The Coulston Foundation, a New Mexico facility. The Coulston 
research laboratory has been cited repeatedly by the U.S. Department of 
Agriculture for violations of the Animal Welfare Act.
    In 1993, three chimpanzees died a grisly death after a heater 
malfunctioned, making their quarters a blistering 140 degrees, 
according to USDA's Veterinary Inspector. The USDA complaint further 
listed four monkeys found dead or dying in their cages. ``They had gone 
without water for at least three days. Although the caretakers were 
trained to test the animals' automatic waterers every day, they had in 
fact simply been checking off that task on their daily logs without 
actually performing the test,'' stated an article in U.S. News & World 
Report. On another occasion, four monkeys who had been left outside in 
100 degree heat died, apparently having choked on their own vomit.
    In each case, it took weeks for the problems to come fully to 
light, due to stonewalling and secrecy from the laboratory. Not 
reporting the first deaths to USDA was a clear violation of federal 
law, and the laboratory's Animal Care and Use Committee (of which 
Coulston himself was a voting member, and which included no one who 
actually cared for the chimpanzees) saw no reason to investigate either 
incident.
    The National Institutes of Health will not renew a $3 million 
yearly contract with the Coulston laboratory. Coulston has boasted that 
``We are the sole source of chimpanzees for research.''
    I would like to cite the National Research Council's 1997 report, 
Chimpanzees in Research. It calls for a five-year breeding moratorium 
because increasing the number of chimpanzees would result in 
overcrowding at existing facilities. It is estimated that this 
moratorium will result in a 15-percent decrease in operating costs by 
the fifth year. Following are relevant quotations from the National 
Research Council report:
    The concept of sanctuaries capable of providing for the long-term 
care and well-being of chimpanzees that are no longer needed for 
research and breeding should become an integral component of the 
strategic plan to achieve the best and most cost-effective solutions to 
the current dilemma. [p. 3]
    [Sanctuary chimpanzees] require less intensive management than 
animals in research facilities, and therefore entail lower costs of 
daily care. [p. 23]
    Sanctuaries offer an opportunity for substantially reducing costs 
of long-term maintenance of chimpanzees without compromising high 
standards of well-being. [p. 57]
    The report also offers two citations, as follows:
    Large outdoor enclosures are relatively inexpensive to build and 
maintain, and provide natural stimulation for the chimpanzees.
    Formation of one or more retirement facilities to which animals 
from existing colonies could be transferred. It is anticipated that 
group housing and reduced handling of animals would reduce operating 
costs below those typical of research facilities.
    Chimpanzees are so closely related to us humans that they share 
98.4 percent of our DNA. Their mental capacities are becoming more and 
more understood and appreciated as studies reveal their remarkable 
capabilities. A book by Roger Fouts entitled: ``Next of Kin'' reports 
on the unusual achievements of the chimpanzee Washoe and four other 
chimpanzees that are being studied by Dr. Fouts and his team at Central 
Washington University's Psychology Department. These chimpanzees use 
American Sign Language to communicate with humans and with each other. 
Dr. Fouts describes in his book the amazement of a scientist who found 
it hard to accept the cognitive abilities of chimpanzees until, driving 
past the Fouts's home, he observed the young Washoe seated in the top 
of a large tree turning the pages of a magazine and signing to herself 
about the contents.
    Television viewers were deeply impressed by a segment on ABC in 
which Hugh Downs accompanied Roger Fouts to a laboratory to renew Dr. 
Fouts' acquaintance with a chimpanzee, Booie by name, whom he had not 
seen for 16 years. Booie was living in a small laboratory cage, and 
when Dr. Fouts came in, Booie immediately recognized him. They talked 
in sign language, and Booie signed a nickname for his old friend that 
Dr. Fouts himself had nearly forgotten. This moving meeting and sad 
parting brought a mass of letters from viewers. There is no doubt that 
the American public wants to see the laboratory chimpanzees retired 
after use as human substitutes in experimentation.
    Recent studies in the field by Sue Savage-Rumbaugh show that 
bonobos, or pygmy chimpanzees, leave messages for one another which 
scientists have been able to decipher. These small chimpanzees, 
traveling through a dense forest, leave signs of the direction they are 
traveling so the other members of their troop can follow without error. 
Sometimes the branches of saplings are bent over, indicating the 
direction; or where a trail divides, leaves are laid in the path with 
the pointed tip indicating which trail should be followed.
    On behalf of the Society for Animal Protective Legislation, I urge 
this distinguished Subcommittee to make possible retirement for 
chimpanzees who have done their stint in research laboratories for the 
benefit of human beings.
    Request for Change in NIH Policy on Acquisitions of Dogs and Cats 
Used by NIH Grantee Institutions
    The National Institutes of Health does not acquire dogs for the 
Institute's in-house research from Class B dealers. This wise policy 
should be expressed also in its funding of grants to other 
institutions. The number of Class B dealers selling dogs and cats for 
research and testing has decreased as a result of examination of their 
practices and premises by academia and commercial laboratories.
    The U.S. Department of Agriculture, which licenses dealers who sell 
purpose-bred dogs and cats (Class A) also continues to license the 
dwindling number of dealers who acquire ``random source'' dogs and cats 
(Class B). USDA has uncovered many instances in which a Class B dealer 
has reported obtaining animals from persons who, in fact, do not exist, 
did not provide the animals or, in some cases, were dead. The practice 
of shipping dogs across the country from one dealer to another makes a 
mockery of any attempt to locate an owner's lost or stolen companion. 
In one case, USDA Inspectors found that names obtained from driver's 
license applications found in a wastebasket, were presented to them as 
the source of numerous laboratory dogs.
    In Congressional testimony presented last year, Dr. Robert A. 
Whitney, former Deputy Surgeon General, U.S. Public Health Service, 
stated:
    I have an extensive background in this and other issues of public 
concern about the procurement and use of animals for biomedical 
research. Before becoming Deputy Surgeon General in 1992, I served as 
Director, National Center for Research Resources (NCRR) of the National 
Institutes of Health (NIH). In my 22 years at NIH I was responsible for 
production, procurement, and care of animals used in NIH intramural 
research. I also served as chairperson of the NIH Animal Care and Use 
Committee, Chairman of the U.S. Government Interagency Research Animal 
Committee (IRAC), and Director, NIH Office of Animal Care and Use. At 
NIH, the use of dogs from Class B dealers, otherwise known as random 
source dogs, ceased many years ago.
    Over the past 25 years I have been involved in the development and 
update of most of the federal policies and regulations governing 
appropriate care, use, and welfare of animals used in biomedical 
research. This experience has led me and many of my colleagues to 
believe that our inability to guarantee the quality of procurement and 
care of animals from Class B dealers creates many problems in public 
perception for the biomedical research community, and potentially in 
the research itself. Despite the small number of animals obtained from 
these sources, their use portends many more problems than the benefits 
which might be derived.
    We urge NIH to require grantees to certify that they will not use 
Class B random source dealers as a source for dogs and cats in their 
proposed research.
                                 ______
                                 
Prepared Statement of Anne R. Pebley, President, Population Association 
  of America [PAA], and Peter J. Donaldson, President, Association of 
                        Population Centers [APC]
    Thank you, Mr. Chairman for this opportunity to present the 
position of the Population Association of America (PAA) and the 
Association of Population Centers (APC) to the Subcommittee on Labor, 
Health and Human Services and Education on fiscal year 1999 funding for 
the National Institutes of Health (NIH), specifically the National 
Institute on Aging (NIA), and the National Institute of Child and 
Maternal Health (NICHD). You are a long-standing friend of both 
organizations and we want to emphasize how grateful we are for your 
appreciation and support of demographic research.
    As you know, PAA is a scientific and educational society of 
professionals working in demographic research. APC is a consortium of 
27 leading American population research centers. In addition to their 
academic roles, members of both organizations provide federal, state 
and local government agencies, as well as private sector institutions, 
with data and research to guide decisionmaking.
    In this testimony, we wish to express our support for the National 
Institutes of Health (NIH), specifically NIH support for demographic, 
social and behavioral research, and share recent demographic trends and 
research findings of interest with Congress.
    Demographic research covers many issues important to our nation, 
such as retirement, minority health, disability and long term care, 
child care, immigration, labor force participation, worker retraining, 
family formation and dissolution and population forecasting. The United 
States is undergoing far-reaching shifts in its demographic composition 
and distribution. Such changes often are not recognized or understood 
until they confront society with new and immediate needs--often 
requiring federal and state expenditures. Incorporating demographic, 
social and behavioral research into long term policy discussions allow 
such changes to be tracked and anticipated in a manner that promotes 
more coherent and efficient planning and policy implementation.
    NIH, specifically the National Institute of Child Health and Human 
Development (NICHD) and the National Institute on Aging (NIA) provide 
primary support for demographic research. We would like to take this 
opportunity to share with you information concerning aging, trends in 
adolescent health, the incidence of teenage pregnancy and abortion 
prevalence and changes in fatherhood.
  the national institute of child health and human development (nichd)
    NICHD has a well-established, successful population research 
program. NICHD is currently funded at $674 million with $39.6 million 
of the budget for research funded through the Demographic and 
Behavioral Sciences. Among the many areas of demographic research 
supported by NICHD are families and households; marriage and family 
change; fertility and family planning; teen pregnancy; mortality; HIV 
prevention; and population movement, distribution and composition. 
NICHD also funds a highly regarded population research centers program. 
Population research centers provide a critical core of professionals 
who conduct research in a cost-effective manner. Further, the centers' 
training programs are an essential source of population scientists who 
bring fresh perspectives, ideas and improved methodologies to 
demographic research.
    As you can see from the wide range of research topics listed above, 
NICHD-supported demographic research provides important, ongoing 
information critical to policymakers. Last year's committee report for 
the fiscal year 1998 NICHD appropriation specifically mentioned the 
National Longitudinal Study of Adolescent Health, also known as the Add 
Health Survey, and this committee's interest in continued reporting on 
this study. We are pleased to provide some information in this 
testimony that focuses on Add Health, your interest in the decreasing 
rates in teen pregnancy and abortion, the Fatherhood Initiative, and 
the Family and Child Well-Being Research Network.
Add health
    The Add Health survey is the first comprehensive national study of 
the social, psychological and environmental determinants of adolescent 
health. This study provides information that is valuable to parents, 
educators, researchers and policymakers. Although teens are generally a 
very healthy sub-group in the population, one in five has a serious 
health problem which are often costly and affect adult health. Each 
year, in the mid-1980's, the lifetime cost of injuries to young people 
15-24 years of age were estimated at $39.4 billion; public support for 
families headed by adolescents cost $16.7 billion per year; treatment 
costs for adolescents with mental health problems were estimated at 
$3.5 billion annually; and $2.0 billion or more per year was spent on 
facilities for delinquent adolescents.
    One of the key findings from the Add Health study was that ``family 
connectedness'' played a central role in protecting adolescent health: 
adolescents who felt loved and cared for by their parents and were 
satisfied with their family relationships were least likely to smoke, 
drink or use illegal drugs; least likely to become sexually active at a 
young age; least likely to be emotionally distressed or contemplate or 
attempt suicide, and least likely to engage in violence.
    Determining how to prevent and treat adolescent health problems 
will contribute to a stronger and healthier society. PAA and APC hope 
this committee will continue to support research, such as the Add 
Health study, that adds to our understanding of changes in the teenage 
and adult population.
Teen pregnancy and teen abortion
    There are encouraging trends in teen pregnancy and the prevalence 
of abortion. The teen birth rate has been steadily decreasing in recent 
years. Since 1991 the rate has declined 12 percent to 54.7 per 1,000 in 
1996. Between 1991 and 1995, the teen birth rate dropped 17 percent 
among non-Hispanic blacks and by more than 9 percent among non-Hispanic 
whites. The teenage Hispanic population did not show a comparable 
decline in birth rates between 1991 and 1995. Another encouraging note 
is that there was a decline in the teen abortion rate in the early 
1990's. These data suggest that the decrease in the teen pregnancy rate 
is not being driven by an increase in abortion.
    Although rates of teen pregnancy are decreasing, the United States 
still has one of the highest teen pregnancy rates among industrialized 
countries. NICHD is currently supporting a study to identify key groups 
of young women who are at a higher risk of becoming a teen parent. One 
such group, younger sisters of pregnant and parenting teens, have more 
permissive childbearing attitudes than do their age and socio-economic 
status-matched peers who do not have an older sister who is a teen 
parent. Realization of this type of information will prove very 
important when creating intervention programs targeted at further 
decreasing the teenage pregnancy rate.
Fatherhood
    The declining significance of marriage has the particular effect of 
weakening the ties of men to women and children, with a resulting 
burden to the welfare system and to women and children themselves. 
Thus, it is important to understand the conditions which help to 
sustain men's obligations to family members. NICHD, in conjunction with 
the Federal interagency Forum on Child and Family Statistics and the 
National Center on Fathers and Families, launched a Fatherhood 
Initiative to review the capacity of the federal statistical system to 
conceptualize, measure and gather information from men about their 
fertility and role as fathers. This same study identified ways to 
improve data collection and research in this area.
Family and child well-being research network
    Finally, we wanted to bring you up-to-date on NICHD's Family and 
Child Well-Being Research Network--an interdisciplinary data system 
focusing on child- and family-related research that relies on cross-
agency cooperation. The network is comprised of scientists from seven 
universities collaboratively working with federal officials from NICHD, 
the Office of the Assistant Secretary for Health, of the Department of 
Health and Human Services (DHHS), the Administration of Children and 
Families, of DHHS, the Census Bureau and the Department of Education. 
This network currently addresses a variety of questions about the 
interrelations between parent characteristics, family structure and 
organization, neighborhood attributes and different forms of social 
support. The network is committed to increasing the visibility of basic 
research findings to those involved in formulating public policy. 
Projects such as the Family and Child Well-Being Research Network 
perform the important task of helping synthesize research into sensible 
policy solutions.
    NICHD's Family and Child Well-Being Research Network, in 
cooperation with federal statistical agencies and the research 
community developed a comprehensive set of indicators of child well-
being. Information from these indices are published annually by 
executive order. The first report titled, America's Children: Key 
National Indicators of Well-Being, was released in 1997. This report 
provides a much improved information base that summarizes the changes 
in the overall well-being of American children and families on an 
annual basis.
    PAA and APC enthusiastically support initiatives such as NICHD's 
Family and Child Well-Being Research Network that provide quick access 
to data and are efficient and effective resources for policy-related 
research in cross-disciplinary fields.
The National Institute on Aging (NIA)
    The NIA also has a well established and widely respected 
demographic research program which provides crucial information on the 
implications of an aging of the American Population for our country. 
Currently, the NIA is funded at $519 million, with $38 million of that 
budget dedicated to demographic research--training, career development, 
and demographic, economic and epidemiologic research. As the US 
population ages and Congress contemplates changes in Medicare and 
Social Security, the demography of the elderly steadily become more 
important. The NIA has a strong history of supporting the collection of 
data which allows demographers to study questions of concern to 
policymakers. Chief among these are the NIA-supported studies, the 
Health and Retirement Study (HRS) and its auxiliary survey, the Asset 
and Health Dynamics of the Oldest-Old (AHEAD) study. You have been a 
solid supporter of these two studies over the years, Mr. Chairman, and 
we would like to express our gratitude for your support.
Health and retirement study (HRS)
    As you know, the HRS focuses on retirement decisions and includes 
data on disability, work history, health and health insurance, pensions 
and retirement plans and obligations to family that may bear on 
retirement decisions. Using HRS data, researchers are able to explore 
issues related to health, disability and labor force participation; 
prospects for economic security; cognitive changes, health insurance 
coverage in the decade before Medicare eligibility.
    HRS research conducted by economists at the University of 
Pennsylvania, for example, indicated that while pre-retirement savings 
appears to be substantial ($340,000 for the median household), the 
present value of Social security wealth accounts for a large share of 
average total wealth (about $145,000). To meet a post-retirement income 
target of 70-80 percent, an average couple in their mid-1950's would 
have to save $10,700 each year until age 65. This would translate into 
a savings rate of 23 percent, far greater than typical savings rates in 
the U.S. Persons in poor health are even less well prepared for 
retirement, with only $5,000 in pension wealth and $80,000 in Social 
Security wealth.
Asset and Health Dynamics of the Oldest-Old [AHEAD]
    The companion survey of HRS, AHEAD, provides unique information on 
the dynamics of health, economic resources and health care services. 
The study provides badly needed data on the costs and burdens of 
chronic disease and the consequences for the extended family. Over 
time, AHEAD will provide data on how families redistribute their 
resources across generations, and how these flows interact with public 
sector transfers. Such a study is needed to make informed policy 
decisions on initiatives such as Medicare/Medicaid coverage for 
community long-term care and health-care reform.
    AHEAD data and research are also providing insights into the 
complex family support system which sustains persons of all ages in 
times of need. Despite the stereotype of the ``greedy geezer'', 
analyses of AHEAD indicate that financial transfers overwhelmingly flow 
from parents to children, even when the parents are very old. These 
transfers disproportionately target adult children in the family who 
are relatively less well off than their siblings. Adult children who 
benefit from such transfers, however, are far more likely to provide 
personal care as their parents become disabled in later life.
    HRS and AHEAD data also provide opportunities to track the 
cognitive performance of older persons as they age. In the total non-
institutionalized population age 70 and over, about 5 percent have 
severe cognitive impairment and another 48 percent score below average. 
As expected, persons of low education and limited financial resources 
are more likely to evidence cognitive deficits in middle and late life.
    Finally, PAA and APC are interested in and support the current 
efforts to strengthen the Federal Forum on Aging Related Statistics 
that coordinates data across federal agencies. The forum is an example 
of NIA's interest in supporting NIH's innovative endeavor of 
streamlining federal databases and making data accessible to 
researchers from varied fields.
    PAA and APC would like to thank you for the opportunity to present 
this information. Demographic data and research are important tools for 
policymakers that can both save public funds and promote more informed 
decision-making. If this vital research is to continue producing 
relevant and timely information, adequate funding and Congressional 
support are needed. The Population Association of America and the 
Association Population Centers support a 15-percent increase in funding 
to sustain the momentum of demographic research in the National 
Institutes of Health as part of the broadly based support to double the 
the funding for the NIH over the next 5 years.
                                 ______
                                 
Prepared Statement of Roger P. Kingsley, and Sharon Moss, on Behalf of 
            the American Speech-Language Hearing Association
    The American Speech-Language-Hearing Association (ASHA) appreciates 
the opportunity to provide testimony to the Senate Appropriations 
Subcommittee on Labor, Health and Human Services, Education and Related 
Agencies. Our statement focuses on funding needs in fiscal year 1999 
for an area that is very important to many members of this association: 
health research. Specifically, the statement will address activities, 
needs and recommendations concerning the National Institute on Deafness 
and Other Communication Disorders (NIDCD).
    ASHA is the national professional, scientific and accrediting 
association for over 93,000 speech-language pathologists, audiologists, 
and speech-language-hearing scientists serving the needs of people 
throughout the United States who have communication and related 
disorders. Speech-language-hearing scientists receive funding to 
support research activities through the National Institutes of Health. 
Research awards have enabled these scientists to conduct research that 
leads to better communication for all Americans.
    The ability to communicate effectively is fundamental to other life 
activities, i.e., learning, interpersonal relationships, and vocational 
pursuits. Any loss or limitation in communication ability can be 
detrimental to an individual's development, accomplishments, and 
overall quality of life.
    Communication impairment is the nation's most prevalent disability: 
approximately 42 million Americans have some kind of communication 
disorder. These disorders result in huge costs to the economy in lost 
productivity, special education, rehabilitation, health care 
expenditures, and lost revenues. It has been estimated that costs 
associated with hearing loss alone approximate $56 billion a year. \1\ 
Costs associated with traumatic brain injury have been estimated at $25 
billion annually. \2\ These costs to society are expected to grow, due 
to several factors:
---------------------------------------------------------------------------
    \1\ Research in Human Communication, 1992 Annual Report of the 
National Deafness and Other Communication Disorders Advisory Board, 
U.S. Department of Health and Human Services--National Institutes of 
Health, 1993.
    \2\ Progress and Promise: In 1992-A Status Report on the NINDS 
Implementation Plan for the Decade of the Brain, the National Advisory 
Neurological Disorders and Stroke Council, Department of Health and 
Human Services--National Institutes of Health, December 1992.
---------------------------------------------------------------------------
    First, increasing numbers of infants and small children have or are 
at risk of developing communication disorders. As more infants survive 
because of medical technological advances, the number of children with 
severe disabilities, often including speech, language and hearing 
disabilities, necessarily increases. With higher incidence of substance 
and alcohol abuse, lead poisoning, and other human and environmental 
factors, there is a growing population of children and youth with 
disorders of communication. Accidents, particularly those involving 
motor vehicles and firearms, also have increased the number of 
communicatively impaired individuals as a result of traumatic brain 
injury--especially among teenagers and young adults.
    Noise-related hearing loss, resulting from machinery, music 
amplification, and other environmental and self-imposed factors, is 
still another increasingly prevalent phenomenon.
    Secondly, the prevalence of communication disorders will increase 
dramatically as the population ages. Impairment in the ability to 
speak, hear, or process language is often associated with diseases and 
conditions that occur as people get older: Alzheimer's Disease, 
resulting in cognitive and language dysfunction; Parkinson's Disease 
and other progressive neurological disorders resulting in oral-motor 
dysfunction; stroke, resulting in aphasia; cancer of the larynx, 
resulting in laryngectomy and voice loss; and presbycusis, or 
degeneration of auditory function resulting in hearing loss.
    Many of the costs relating to these conditions are borne by federal 
and state governments. The populations targeted by research through the 
NIDCD are many of the same populations which receive services through 
the IDEA, the Rehabilitation Act, Medicare, Medicaid, Social Security 
Disability Income and other public programs. Research that focuses on 
detection, diagnosis, treatment and prevention, should result in a 
reduction in the need for special education, rehabilitation, and health 
care services.
    The NIDCD is the major institution for coordinating and funding of 
speech, language, and hearing scientists who are engaged in intramural 
and extramural research that focuses on disorders of communication. The 
Institute's work holds forth great promise that some of the difficult 
challenges within the field of communication disorders can now be 
addressed. We strongly support many of the initiatives proposed by the 
NIDCD, particularly those addressing hearing, language, voice, and 
speech: diagnostic and intervention strategies following neonatal 
hearing screening; mechanisms of learning and relearning after brain 
damage; and communication disorders following stroke in multicultural 
and multilingual individuals. Continuing the acceleration in federal 
funding support will allow the Institute to promote research in areas 
that have the potential of improving the lives of people of all ages.
    Studies addressing the identification of hearing loss in children 
and infants are sorely needed and could lead to the development of more 
innovative, and less expensive behavioral audiometric tests, better 
speech and language materials for children, and highly sensitive parent 
inventories. Examining how language learning and relearning take place 
subsequent to brain injury is crucial to the understanding of the brain 
and behavioral mechanisms related to first language learning 
acquisition, and to maximizing and understanding the recovery processes 
of acquired language disorders.
    More research also is needed on the prevalence and incidence, long-
term functional outcomes and post-stroke quality of life issues of 
aphasia among multilingual and multicultural populations. In addition, 
efforts should be directed toward the development of culturally 
sensitive assessment and intervention instruments for persons from 
different ethnic populations following stroke-induced aphasia. ASHA is 
also supportive of NIDCD's program initiative of research in the area 
of sickle cell anemia in children because of the communication 
disorders that result subsequent to stroke, and the high risk of stroke 
in this population.
    ASHA is supportive of many other efforts that advance the knowledge 
about mechanisms and processes of human communication, and that improve 
the approaches to prevention, diagnosis, and treatment of communication 
disorders. For example, studies that examine the human brain using 
imaging tools during various communication events; the molecular 
mechanisms that underlie hair cell regeneration in the inner ear; the 
efficacy of the cochlear implant prosthesis; and mechanisms for early 
and more precise diagnosis of specific language impairment in children.
    ASHA is supportive of a research portfolio that includes behavioral 
and clinical research, as well as basic research activities. We also 
support the continuation of efforts to fund the clinical trials program 
beyond the current levels. Members of ASHA have been able to utilize 
this program to test the efficacy of different treatment approaches, 
thereby having a significant impact on current public health and health 
care financing discussions.
    ASHA also supports research that allows for collaboration with 
other Institutes such as: the National Institute on Aging, National 
Cancer Institute, National Institute of Child Health and Human 
Development, National Institute of Mental Health, and National 
Institute of Neurological Disorders and Stroke. Research that supports 
the development of improved diagnosis and more effective intervention 
strategies for autism, velocardiofacial syndrome, and recurrent otitis 
media is greatly needed and is encouraged by ASHA.
    ASHA supports the recommendation made by some members of Congress 
and by the Ad Hoc Group for Medical Research Funding, of which we 
belong, for an increase of 15 percent overall for the NIH. As one of 
the newer institutes and having lagged behind other research institutes 
with respect to funding increases, we concur with the recommendation by 
the American Academy of Otolaryngology-Head and Neck Surgery for an 
increase of 18 percent for the NIDCD.
    Mr. Chairman, we appreciate the opportunity to provide these 
comments and recommendations to your Subcommittee. We look forward to 
working with you and your staff as well as with the other members of 
the Subcommittee and their staffs as the fiscal year 1999 
appropriations process moves forward.
                                 ______
                                 
Prepared Statement of the Chuck Ludlam, on Behalf of the Biotechnology 
                         Industry Organization
 contributions to new medicine from government-funded basic biomedical 
                                research
    The Biotechnology Industry Organization (BIO) submits this 
statement in support of substantial increases in appropriations for the 
National Institutes of Health (NIH). BIO represents over 750 
biotechnology companies, academic institutions, and state biotechnology 
centers in 46 States and more than 25 nations. BIO members are involved 
in the research and development of the life sciences including health 
care, agricultural, and environmental biotechnology products.
    BIO is a member of the Ad Hoc Group for Medical Research Funding, a 
coalition of voluntary health groups, medical and scientific societies, 
academic and research organizations and industry representatives. BIO 
supports the Ad Hoc Group for Medical Research Funding proposal which 
calls for a 15-percent increase in NIH funding for fiscal year 1999. 
This increase should be the first step towards doubling the NIH budget 
over 5 years. BIO recognizes the difficulty in achieving such a goal 
under the current spending limits, and therefore, encourages the Senate 
Appropriations Subcommittee to explore all possible options to identify 
the additional resources needed to support this increase.
    This statement outlines how society benefits from increased NIH 
funding. This statement also emphasizes and documents the vibrant 
partnership the biotechnology industry has with the NIH and its 
grantees, a partnership which helps ensure that basic biomedical 
research is developed into products for the benefit of patients.
                 nih-biotechnology industry partnership
    There is a synergy between the U.S. biotechnology industry and the 
NIH and its grantees based on technology transfer programs which are 
essential for the application of basic biomedical research to human 
needs.
    The transfer of technology is fundamental to the partnership 
between non-profit, federally-funded basic biomedical research and for-
profit commercial firms. This partnership builds upon the strengths of 
each: government funding for NIH research (predominantly basic 
biomedical research); company funding for basic and applied biomedical 
research (which explores ways to develop basic biomedical research into 
products which treat disease). The technology transfer process provides 
a fundamental justification for continued funding increases for basic 
biomedical research.
    Unlike basic biomedical research conducted by private companies, 
federally-funded basic biomedical research must be transferred to a 
private firm to become available to patients. In the American economy 
neither the government nor government-funded laboratories commercialize 
products. This is the indispensable role of the biotechnology and 
pharmaceutical industries. To commercialize a product the biotechnology 
industry has to: raise immense amounts of capital needed to take a 
product through clinical trials and the Food and Drug Administration 
(FDA) product approval process; secure appropriate intellectual 
property protection for inventions which occur in the drug development 
process; and manufacture and distribute the final product to patients. 
It is critical to patients, therefore, that federally-funded basic 
biomedical research is transferred to biotechnology and pharmaceutical 
companies. Only then does this research lead to new medicines and 
treatments for disease. Over 100 million people have been helped by the 
60 biotechnology therapies and vaccines on the market today.
    Federally-funded basic biomedical research is extremely important 
to the biotechnology and pharmaceutical industries. In fact, the fruits 
of this research helped create the biotechnology industry with the 
discovery of recombinant DNA in 1973. Since then, what has enabled the 
biotechnology industry to grow so rapidly for so long has been the 
effective technology partnership system that developed in the 1980's. 
From the 1980's onward technology partnerships between government-
funded researchers and the private industry have remained one of the 
driving forces for growth in the biotechnology and pharmaceutical 
industries.
    Increased funding for the NIH will generate even more basic 
biomedical research which can be transferred to the private sector for 
commercialization. From 1992 to 1996 between 68 percent and 72 percent 
of research grant applications went unfunded. \1\ This problem is only 
made worse by the fact that many of these unfunded grant applications 
are for ongoing research projects which were funded in previous years. 
From 1992 to 1996 between 51 percent and 55 percent of grant 
application renewals went unfunded. \1\ These grant applications could 
not be accepted because the NIH did not have sufficient appropriations 
to fund them. This high percentage of application rejection occurs in 
spite of the fact that in 1996 about 85 percent of the NIH budget was 
used to provide support to these extramural researchers (researchers 
that are not employees of the NIH).
---------------------------------------------------------------------------
    \1\ National Institutes of Health home page (http://
www.nci.nih.gov/admin/fmb/e65.htm).
---------------------------------------------------------------------------
    With increased funding many more grants will be awarded and will 
lead to medical breakthroughs that can be commercialized by the 
biotechnology and pharmaceutical industries.
    The NIH and its grantees have established effective mechanisms to 
ensure that basic biomedical research breakthroughs will be transferred 
to the private sector for development into products. Technology 
partnerships take a number of forms depending on whether they involve 
the NIH or NIH-funded research. In each case the biotechnology industry 
is open to paying royalties for the patent rights to medical 
technologies. The principal technology partnership mechanisms are 
listed below:
                   technology partnership mechanisms
    Cooperative Research And Development Agreement (CRADA).--A CRADA is 
an agreement through which researchers at the NIH and private companies 
negotiate terms for cooperative research and define the rights of the 
parties to use licenses for any patents which might be created as a 
result of the research. CRADAs are the cornerstone of the basic 
biomedical research partnerships between the NIH and the biotechnology 
and pharmaceutical industries. In many cases the corporate partner 
provides funding and other resources to conduct research at the NIH. 
This corporate partner will then take the new technology and develop a 
marketable product. The figures in the chart on page six show a direct 
relationship between increases in NIH funding and increases in both 
CRADAs executed and royalty income attributed to the sale of new 
inventions. In fiscal year 1996 and fiscal year 1997 the number of 
CRADAs increased dramatically. This increase in CRADA activity also led 
to increases in patents issued to companies which, in turn, will likely 
lead to the approval of new drugs in the market place.
    Bayh-Dole Agreements.--A Bayh-Dole Agreement is the corollary to 
the CRADA for NIH grantees (universities and foundations). Bayh-Dole 
Agreements are agreements between universities or medical institutes 
and biotechnology companies or pharmaceutical companies in which the 
parties define the licensing rights to patents that might be created 
and agree on how to share funds, materials, and scientists in the 
collaborative research effort. Bayh-Dole Agreements, like CRADAs, 
generate patent income.
    The two charts below show a relationship between the amount of NIH 
funding a university receives and the amount of royalties generated on 
patented inventions attributed to the NIH-funded research.

                TOP FIVE REVENUE GENERATING UNIVERSITIES
------------------------------------------------------------------------
                                           In fiscal year 1995 \1\--
                                     -----------------------------------
                                                            Research
                                                          expenditures
                                          Royalties       from Federal
                                          received         Government
                                                         sources \2\ \3\
------------------------------------------------------------------------
University of California System.....       $57,272,000      $835,637,000
Stanford University.................        38,900,000       316,000,000
Columbia University.................        34,194,811       204,000,000
Michigan State University...........        15,279,521       277,900,000
W.A.R. F./University of Wisconsin-          12,380,000       197,626,417
 Madison............................
------------------------------------------------------------------------
\1\ Association of University Technology Managers, AUTM Licensing Survey
  fiscal year 1991-95 (Norwalk, CT: Association of University Technology
  Managers, 1996) 76.
\2\ This funding is predominantly from NIH.
\3\ Association of University Technology Managers, AUTM Licensing Survey
  fiscal year 1991-95 (Norwalk, CT: Association of University Technology
  Managers, 1996) 100.


                            JOHN HOPKINS UNIVERSITY PATENT AND LICENSING ACTIVITY \1\
----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal year--
                                               -----------------------------------------------------------------
                                                   1991      11992       1993       1994       1995       1996
----------------------------------------------------------------------------------------------------------------
NIH grants (millions of dollars)..............     $162.8     $203.9     $230.8     $258.0     $254.4     $262.7
Inventions reported to NIH \2\................         19         32         41         44         44         58
Patents applications filed from NIH sponsored          13         20         26         27         43         48
 inventions...................................
Royalties received (millions of dollars)......      $1.69      $2.24      $2.29      $2.18      $1.25      $1.63
Royalties received from NIH funded inventions          NA         NA         NA         NA   $692.835   $948.336
 (in thousands of dollars)....................
----------------------------------------------------------------------------------------------------------------
\1\ Theodore O. Poehler, Vice Provost for Research, Office of the Provost, John Hopkins University, Baltimore,
  Maryland (1998).
\2\ Includes Arts and Science, Engineering, Hygiene, and Public Health, Medicine, Nursing, Academic Centers, and
  Health Division Administration.

    Licensing of patents.--These partnerships focus on the licensing of 
patents on basic biomedical research discoveries. These licenses are 
critical to the relationship between biotechnology and pharmaceutical 
companies and the NIH and its grantees. Without patents to protect the 
taking of an invention by a competitor, a company cannot justify its 
research investment. It is crucial that the NIH and its grantees, 
therefore, secure patents on their inventions so companies that invest 
money in developing these inventions can benefit from their investment. 
The licenses require companies to make royalty payments to the 
proprietary owner of the license, or licensor, based on any sales of 
products attributed to the licensed patent.
    The biotechnology industry expects to pay royalties as a part of a 
license agreement. Companies frequently license technology from one 
another and the norm is to include royalty payments. It is important 
for the NIH and its grantees to set royalty payment that are 
competitive to those which a company would expect to pay another 
company. Otherwise, companies would tend to seek technology from 
sources other than the NIH or its grantees. The government has a 
reasonable expectation that its investment in research will be rewarded 
with royalty payments. No company would expect the government or its 
grantees to license technology without receiving a return on its 
investment. This return, in the form of royalty payments, can be used 
by the government to fund additional research.
    In 1997 the total royalty income the NIH received was $35,692,000 
or .281 percent of its budget for the same year ($12.7 billion; this 
information is available on the chart on page 6). It is clear that this 
small amount of royalty income is not likely to ever grow enough to 
support the entire NIH budget. It is unlikely, therefore, that the NIH 
will ever be able to rely on its royalty income to support its research 
budget.
    Small Business Innovative Research (SBIR) and Small Business 
Technology Transfer (STTR) programs.--The SBIR and STTR programs--
supported by federal government funding through the NIH--provide 
funding to biotechnology and pharmaceutical companies to conduct 
research and development of new or improved technologies that have the 
potential to succeed as commercial products. For 1998 the total 
estimated funding for SBIR and STTR programs combined is $280.6 
million. These two programs are indispensable to the biotechnology 
industry as a source of seed capital for early stage biotechnology 
companies. BIO supports these programs and has worked with the NIH to 
provide recommendations on how to improve these programs and to assist 
in outreach to the biotechnology community. For specific funding levels 
for the SBIR and STTR programs see the chart on page 7.
NIH technology transfer reform
    The effectiveness of the NIH technology transfer program has 
increased dramatically in recent years. The unconditional repeal of the 
``reasonable price'' clause in April of 1995 has been critical to this 
success. Congress should support NIH's decision and not move to force 
it to reinstate the ill-conceived price review policy. To do so would 
jeopardize the gains we have seen in the effectiveness of its 
technology partnership program.
    The repeal of the price reviews policy was both decisive and 
justified. Among biotechnology companies it has substantially increased 
interest in collaborating with the NIH and other Public Health Service 
(PHS) agencies. It reassures companies who enter into collaborations 
with NIH and PHS grantees that their agreements will not someday be 
subject to a pricing clause. The functioning ``reasonable price'' 
clause prior to April 1995 deterred companies from collaborating with 
NIH and decreased NIH's ability to transfer its basic biomedical 
research into marketable products.
    The impact of this repeal has been dramatic as shown in the figures 
in the following chart. For example, the number of CRADAs rose from a 
low of 31 in 1994 to 87 in 1996 and 153 in 1997. The number of licenses 
grew from a low of 75 in 1993 to a high of 208 in 1997. Royalties also 
grew substantially. These figures demonstrate the wisdom of the NIH 
decision to repeal the clause.

                      SUMMARY OF NIH TECHNOLOGY TRANSFER ACTIVITIES FISCAL YEAR 1993-97 \1\
----------------------------------------------------------------------------------------------------------------
                                                                          Fiscal year--
                                                ----------------------------------------------------------------
                                                     1993         1994         1995         1996         1997
----------------------------------------------------------------------------------------------------------------
Number of issued patents.......................           88           75           95          107          119
Executed licenses..............................           75          125          160          184          208
Executed CRADA's...............................           41           31           32           87          153
Royalties (thousands of dollars)...............      $13,494      $18,487      $19,388      $26,995      $35,692
NIH budget authority (billions of dollars) \2\.        $10.3        $10.9        $11.3        $11.9        $12.7
----------------------------------------------------------------------------------------------------------------
\1\ National Institutes of Health home page (http://www.nih.gov), following this sequence of directories:
  Scientific Resources, The NIH Office of Technology Transfer, Technology Development and Licensing Programs,
  Patents and Licensing Statistics or at http://www.nih.gov:80/od/ott/nih93-97.htm. For questions contact
  MaryAnn Martinez, Secretary to the Director, Office of Technology Transfer, National Institutes of Health.
\2\ Contact Mitchel Goldstein, Department of Health and Human Services Budget Office.


                         SUMMARY OF NIH SBIR AND STTR ACTIVITIES FISCAL YEAR 1993-97 \1\
                                              [Dollars in millions]
----------------------------------------------------------------------------------------------------------------
                                                                               Fiscal year--
                                                          ------------------------------------------------------
                                                              1993       1994       1995       1996       1997
----------------------------------------------------------------------------------------------------------------
STTR's (awards)..........................................         NA         48         90        109        111
STTR's...................................................         NA       $4.7       $8.7      $13.9      $14.7
SBIR's (awards)..........................................      1,011        943      1,038        967      1,251
SBIR's...................................................       $121     $128.7     $175.1     $184.9     $246.2
----------------------------------------------------------------------------------------------------------------
\1\ Contact Sonny Kreitman, Special Programs Officer, Office of Extramural Programs, National Institutes of
  Health.

    In 1995 and 1996 amendments to the NIH appropriations bill were 
offered in the House of Representatives to reinstate the ``reasonable 
price'' clause. These amendments were decisively rejected. BIO strongly 
opposed these amendments and believes the NIH's mission is research, 
not the pricing of medicines developed. Issues of pricing or access 
only should arise once a medicine has been developed and approved by 
the Food and Drug Administration (FDA). Raising issues of pricing or 
access during the research stage is premature and counter-productive. 
It undermines the ability of our companies to convince investors to 
fund a collaborative research program with the NIH. When medicines are 
developed from NIH basic biomedical research, then the NIH has 
completed its mission and deserves praise--and royalties--for its 
fundamental contribution to the health of patients and the advancement 
of science.
    A great many experts have found that pricing reviews are damaging 
to the NIH technology partnership program:
  --Reasonable price clauses ``discourage technology transfer and the 
        development of new therapeutic products by imposing price 
        restrictions that may limit the ability of any company to 
        recover its costs of research and development. Royalty 
        provisions or payments to reimburse the government laboratory 
        for its costs or, in appropriate circumstances, the supply of 
        clinical materials (rather than restrictions on the pricing of 
        products) may be more appropriate mechanisms to fairly and 
        appropriately compensate the government laboratory for the use 
        of its technology in commercial development.'' Final Draft 
        Report of the External Advisory Committee of the Director's 
        Advisory Committee, The Intramural Research Program, National 
        Institutes of Health, April 11, 1994.
  --The NIH insistence on price controls ``nearly ruined the system,'' 
        said Dr. Steven Paul, the former scientific director of the 
        National Institute of Mental Health and a creator of the NIH 
        technology transfer program. Cited by Dr. Robert Goldberg in 
        ``Race Against the Cure: The Health Hazards of Pharmaceutical 
        Price Controls,'' Policy Review, Spring 1994 (number 68) at 34.
  --A report by the HHS Inspector General noted that the controversy at 
        NIH over CRADA pricing threatens support for the program 
        (Office of Inspector General, Dept. of HHS, Technology Transfer 
        and the Public Interest: Cooperative Research and Development 
        Agreements at NIH (OEI-92-01100) (Nov. 93)). This report finds 
        that the use of an arbitrary and unpredictable ``reasonable 
        price clause'' is undermining the transfer of NIH patents to 
        private companies. Many private biomedical research companies 
        now refuse to participate in CRADAs. This fact undermines the 
        rationale for appropriating so many billions of dollars to fund 
        this basic research.
  --Dr. Bruce Chabner, Director of the National Cancer Institute's 
        (NCI) Division of Cancer Treatment, in testimony at a 
        congressional hearing last year discussed specific instances in 
        which companies have discontinued projects or suspended CRADA 
        negotiations because of concerns raised by the ``reasonable 
        pricing clause.'' Chabner noted that ``Other companies have 
        simply refused to become involved with the NCI in early drug 
        development * * *. NCI has no doubt that companies will not 
        accept the risks of investing large sums in the development of 
        a government product if their freedom to realize a profit is 
        restricted. These companies are not willing to put their 
        corporate fate in the hands of a government-appointed committee 
        of experts. There are less risky ways for companies to make a 
        profit.'' Testimony of Dr. Bruce Chabner, Director of the 
        Division of Cancer Treatment, National Center Institute, before 
        the House Subcommittee on Regulation, Business Opportunities 
        and Energy of the House Committee on Small Business (Jan. 25, 
        1993).
  --The Committee to Study Medication Development at the National 
        Institute on Drug Abuse states that the ``reasonable-pricing 
        clause required in (DHHS CRADAs) in the last year has been 
        identified by NIDA as a major deterrent to attracting private-
        sector partnerships.'' The Committee ``recommends a change in 
        the reasonable pricing provisions of DHHS CRADAs so that 
        licensees or manufacturers of medications know explicitly the 
        ultimate pricing or pricing structure for their potential 
        therapeutic agent.'' Development of Anti-Addiction Medications: 
        Issues for the Government and Private Sector, Institutes of 
        Medicine, 1994.
  --An article cites NIH officials attributing the price control clause 
        for the precipitous decline in CRADA's. ``Many pharmaceutical 
        companies are reconsidering CRADA's, and NIH officials say four 
        of the largest--have told NIH that they plan to forego new 
        CRADA's unless the pricing clause is removed.'' Christopher 
        Anderson, ``Rocky Road for Federal Research Inc.'', Science, 
        497 (October 22, 1993).
  --The Cancer Letter published a draft ``Action Plan on Breast 
        Cancer'' developed from a recent NIH conference convened by 
        Secretary Donna Shalala which recommends ``increase(d) efforts 
        to speed the translation of basic research into clinical 
        applications'' and ``review of the reasonable pricing clause in 
        relation to CRADAS, as they impact of the flow of industrial 
        funds into clinical research and, thus, affect 
        collaborations.'' Cancer Letter, March 25, 1994.
    It is clear that the increased effectiveness of the NIH technology 
partnership program would be jeopardized if Congress moves to force NIH 
to reinstate its pricing review.
Five reasons for supporting increases in NIH funding
    This explanation of the technology transfer reform and the 
partnership between government-funded and private-sector funded basic 
biomedical research explains why the biotechnology industry so strongly 
supports increased NIH funding. Five fundamental reasons follow for why 
it is in the national and public interest to increase the NIH fiscal 
year 1999 budget by 15 percent as the first step toward doubling its 
budget over five years.
            Reason No. 1: Better health and less suffering
    Basic biomedical research is a noble undertaking that provides 
better health and less suffering for Americans with disease. About 85 
percent of the NIH's budget is spent on the extramural program 
supporting 25,000 different research grants each year which go to more 
than 50,000 scientists, doctors, and researchers at 2,000 different 
institutions across the country. Another 10 percent of the NIH budget 
goes to the intramural program which supports research projects 
conducted by medical scientists in NIH's more than 20 institutes and 
centers. This clear commitment to research has led to strong health 
benefits for Americans.
    Within the past 25 years mortality rates related to heart disease 
and stroke have decreased by 40 percent and 60 percent, respectively. A 
vaccine for hepatitis B has been developed. Americans live free of 
diseases such as polio, tetanus, and small pox. Death rates from cancer 
have started to decline in the United States. The number of Americans 
who survive cancer for five years or longer has increased by more than 
50 percent. And yet many Americans take these medical advances for 
granted and are not aware that NIH funding helps make these medical 
advances possible.
    To focus only on past achievements would underestimate the success 
the NIH is having. To give doctors and patients more effective tools to 
combat disease, the NIH is currently directing research programs such 
as the Human Genome Project which involves constructing a human genetic 
map to aid in identifying disease genes. Some of the first 
beneficiaries of the Human Genome Project will be families with a high 
risk of colon cancer. This is because this research will make it 
possible to determine which family members carry colon cancer genes and 
enable them to obtain appropriate health care. Because of research 
conducted at the NIH and subsequently developed by companies, those 
living with Parkinson's disease, cancer, Alzheimer's disease, AIDS and 
other diseases are already living longer.
    To give an example, according to Senator Tom Harkin (D-IA), Dr. 
Steven A. Rosenberg, Chief of Surgery, Division of Clinical Sciences, 
National Cancer Institute at the NIH, has created a treatment for 
melanoma, a kind of skin cancer, which so far has had a 50-percent 
success rate.\4\
---------------------------------------------------------------------------
    \4\ Senator Tom Harkin (D-IA), speech on NIH funding, NIHx2 Press 
Conference, March 19, 1998, Senate Dirksen Office Building.
---------------------------------------------------------------------------
    In order to take full advantage of these scientific advances and 
find cures for these and other diseases, NIH Appropriations increases 
are required.
            Reason No. 2: Basic biomedical research is not self-
                    sustaining
    Basic biomedical research is not self-sustaining. The biotechnology 
and pharmaceutical industries cannot provide the funding to conduct the 
level of basic biomedical research required to keep both industries 
growing. As it is, the biotechnology and pharmaceutical industries 
already conduct billions of dollars worth of basic and applied 
biomedical research. The reason this research is so expensive is 
because biotechnology companies are advancing basic and applied science 
at the same time. In partnership with the NIH, biotechnology and 
pharmaceutical companies conduct some basic biomedical research, but 
primarily they conduct applied research, which builds upon basic 
research.
    In 1997 the NIH annual budget was $12.7 billion of which the vast 
majority was spent on basic biomedical research. This is much more than 
the $9 billion the biotechnology industry spent on all types of 
research in the same year, of which only a small portion was spent on 
basic biomedical research. Furthermore, the large research investment 
incurred by the biotechnology industry comes at a great risk. These 
risks are clearly reflected by the fact that only about one percent of 
biotechnology companies are profitable. In 1993 only 13 of America's 
1,300 biotechnology companies were profitable. In 1997, the 
biotechnology industry lost $4.1 billion which was a nine percent 
decrease in losses over the previous year ($4.5 billion in losses).\5\
---------------------------------------------------------------------------
    \5\ Ernst & Young, New directions: The Twelfth Biotechnology 
Industry Annual Report, 6. (1998).
---------------------------------------------------------------------------
    To understand why biotechnology companies are unable to pay for the 
basic biomedical research conducted at the NIH one has to look at the 
following facts about the biotechnology industry:
    In 1993, on average, biotechnology firms spent $59,000 per employee 
on research. In the same year the U.S. corporate average was $7,476. 
According to Business Week's ``1995 R&D Scoreboard'' in 1995 the five 
U.S. companies that had the highest investment in research and 
development per employee were biotechnology firms. For details turn to 
page 13.
    Because of the high research costs involved and the limited number 
of profitable biotechnology companies, the biotechnology industry can 
not ever be expected to replace the crucial role of the NIH. Therefore, 
the best funding source for basic biomedical research has been and can 
only be the Federal government.
            Reason No. 3: NIH funding saves money long term
    By investing in the NIH the Federal government saves money in the 
long term. This savings is attributed to the fact that it is much less 
expensive to invest in cures for diseases than it is to treat patients 
who already live with disease. ``The National Institutes of Health 
(NIH) plays a critical role in facilitating innovations that lead to 
significant reductions in health care costs. In a series of case 
studies published in 1993, the NIH identified 34 examples of clinical 
trials and applied research studies that have resulted in savings in 
treatment costs and reductions in lost productivity due to disease, 
disability, and premature death. Together, the examples yield an 
estimated annual potential savings ranging from $8.3 billion to $12 
billion.'' \6\
---------------------------------------------------------------------------
    \6\ The Ad Hoc Group for Medical Research Funding's home page 
(http://www.aamc.org/) under the heading ``Fact Sheets About NIH'' and 
subheading ``Examples of Cost Savings from NIH Research'' or directly 
located at (http://www.aamc.org/research/adhocgp/costsav.htm).
---------------------------------------------------------------------------
    Below are examples of cost saving cures for diseases which are a 
large economic burden to the U.S. economy:
    The NIH discovered a gene that is a major risk factor for 
Alzheimer's disease and NIH-funded research continues to explore the 
role genes play in causing this disease. With adequate funding this 
research will prevent or delay the onset of Alzheimer's. Members of 
Congress often state that doing this would save Medicare from 
bankruptcy in the 21st century. This is because the total national cost 
to care for Alzheimer's patients is more than $100 billion annually.\7\
---------------------------------------------------------------------------
    \7\ Speaker Newt Gingrich, ``Personal Experiences Spur Speaker of 
the House To Campaign for Increased NIH and NAS Funding,'' Roll Call 
February 23, 1998.
---------------------------------------------------------------------------
    A solid return from Congress's investment in the NIH can be seen in 
the development of a two-stage diagnosis-treatment of breast cancer. 
While the cost of developing this diagnosis-treatment was $14.3 million 
a year for 15 consecutive years, this technology generates an estimated 
$263 million to $526 million in annual savings in avoided medical 
costs.\8\
---------------------------------------------------------------------------
    \8\ Senator Barbara A. Mikulski, ``NIH Needs More Money to Continue 
Its Biomedical Legacy,''Roll Call February 23, 1998.
---------------------------------------------------------------------------
    NIH-funded research has already provided great benefits in the case 
of melanoma, a kind of skin cancer. According to Senator Tom Harkin (D-
IA), Dr. Steven A. Rosenberg, Chief of Surgery, Division of Clinical 
Sciences, National Cancer Institute at the NIH, has developed a 
treatment for melanoma. Dr. Rosenberg's treatment has had a 50-percent 
success rate for patients so far. While the economic savings has not 
been calculated yet, any cure for a kind of cancer would save money and 
prevent needless suffering.\9\
---------------------------------------------------------------------------
    \9\ Senator Tom Harkin (D-IA), speech on NIH funding, NIHx2 Press 
Conference, March 19, 1998, Senate Dirksen Office Building.
---------------------------------------------------------------------------
    According to Selma J. Mushkin, author of ``Biomedical Research: 
Costs and Benefits,'' every dollar invested in biomedical research 
between 1900 and 1975 produced a $10 to $15 return in savings.\10\
---------------------------------------------------------------------------
    \10\ Selma J. Mushkin, Biomedical Research: Costs and Benefits 
(Cambridge: Ballinger Publishing Co. 1979).
---------------------------------------------------------------------------
    In conclusion, it is clear that investing in basic biomedical 
research is an effective way to find cures and therapies for disease. 
Furthermore, increasing NIH funding can bring significant savings with 
early cures and prevention that will avoid higher future health care 
costs.
            Reason No. 4: Generates jobs and secures U.S. economic 
                    leadership
    NIH funding generates jobs and investment in the private sector. In 
the last 25 years biotechnology has become an expanding industry, 
employing over 140,000 people in 1997, a nineteen percent increase over 
1996 (118,000).\11\ In 1997 product sales were at $13 billion, a 20-
percent increase over 1996 ($10.8 billion).\11\ Over the last four 
years the biotechnology industry's market capitalization (value of the 
entire capital assets) has gone from $41 billion \12\ to $93 
billion.\11\
---------------------------------------------------------------------------
    \11\ Ernst & Young, New directions: The Twelfth Biotechnology 
Industry Annual Report, 6. (1998).
    \12\ Ernst & Young, Biotech 95: Reform, Restructure, Renewal, The 
Industry Annual Report, 2. (1994).
---------------------------------------------------------------------------
    One reason why the biotechnology industry has created so much 
growth in jobs and product sales is in large part attributed to its 
high levels of investment. Business Week conducted the ``1995 R&D 
Scoreboard'' which measured the level of research and development 
investment per employee in U.S. companies. In this study, five of the 
top ten U.S. companies were biotechnology firms. The complete R&D chart 
is listed below.

Business Week R&D Scoreboard 1995 \1\

        Rank                                                            
Biogen \2\..............................................    ($210,653.5)
Genetics Institute \2\..................................     (114,942.5)
Genentech \2\...........................................     (112,029.8)
Immunex \2\.............................................     (102,719.1)
Amgen \2\...............................................      (91,265.8)
S3......................................................      (82,548.3)
Adobe systems...........................................      (70,993.0)
Platinum technology.....................................      (69,787.3)
Cirrus logic............................................      (68,745.6)
Network computing devices...............................      (68,308.0)

\1\ 1995 ``R&D Scoreboard,'' Business Week 3 July 1995.
\2\ Biotechnology companies.
---------------------------------------------------------------------------
            Reason No. 5: Training of scientists
    Many of the most talented and knowledgeable scientists hired by the 
biotechnology and pharmaceutical industries are trained at the NIH or 
at affiliated universities, or they were previous recipients of NIH 
grants. In 1997 about 50 percent of biotechnology companies surveyed 
(39 of 79) had at least one NIH-trained scientist working for them; 
some companies had over 50 NIH-trained scientists.
    While it is very difficult to estimate the number of scientists 
that have been formally trained by the NIH it is accepted as fact that 
the United States has the world's leading graduate education 
institutions, of which NIH is one. Many Nobel Laureates and other 
research pioneers benefit from the NIH's state-of-the-art facilities 
and strong financial resources. For the United States to remain the 
world leader in innovative research and basic biomedical scientific 
inquiry requires increased NIH funding. Increasing funding will enable 
the NIH to provide more training for scientists who will find cures for 
diseases previously believed incurable.
                               conclusion
    The United States is the world leader in research and development 
for health related technologies providing patients with treatments and 
therapies for disease. Basic biomedical research benefits Americans and 
all of humanity. It generates jobs and investment. It trains the 
world's best scientists. But basic biomedical research is not self-
sustaining and depends on government funding. In order to save money in 
the long term and maximize the benefit of previous scientific 
discoveries, the Federal government needs to strengthen its commitment 
to the NIH. The Biotechnology Industry Organization believes the single 
best way to do this is to increase NIH appropriations by $2 billion for 
fiscal year 1999 and double the NIH budget over the next five years.
    We appreciate this opportunity to present this statement.
                                 ______
                                 
Prepared Statement of Donna Meltzer, American Association of University 
Affiliated Programs for Persons With Developmental Disabilities, Chair, 
              on Behalf of the Friends of NICHD Coalition
    Mr. Chairman, I am pleased to be able to testify today on behalf of 
the Friends of NICHD, a coalition of nearly 100 organizations that 
support the extraordinary work of the National Institutes of Health 
with a special focus on the National Institute of Child Health and 
Human Development. Our coalition, which is in its 12th year, includes 
scientists, health professionals, and advocates for the health and 
welfare of women, children, families, and people with disabilities. 
Pursuant to clause 2(g)4 of House Rule XI, I would like to note for the 
record that the coalition does not receive any federal funds.
    Since its inception in 1963, the National Institute of Child Health 
and Human Development (NICHD) has compiled an impressive record of 
achievement, conducting and funding research on the prevention and 
treatment of many of the nation's most devastating health problems: 
infant mortality and low birthweight, unintended pregnancy, birth 
defects, mental retardation and other developmental disabilities, and 
pediatric AIDS.
    A recent quote I read in an article in the Washington Post said, 
``I will protect my child from everything except a life lived 
passionately.'' I noted this quote as it seemed to summarize exactly 
the way my husband and I hope to raise our children. While I can 
encourage my young son to live passionately, the opportunity to do so 
will ultimately be his. However, as a parent, it is my job to protect 
his health and nurture his well-being in every way possible.
    Thanks to the work of the NICHD, I and many others like myself have 
been able to deliver healthy, happy babies and do a better job of 
protecting their health. With testing such as that for PKU, a test 
which was perfected in a mental retardation research center funded by 
NICHD, parents are able to prevent, to the best of our ability, the 
occurrence of mental retardation in our babies. We now know that we 
must put our babies to sleep on their backs to prevent SIDS, and we 
working moms can feel better about having our children in day care 
thanks to the information NICHD has been collecting in their ongoing 
Child Care study.
    I am especially pleased today to have the opportunity to thank you 
Mr. Chairman, and the members of this Committee for the very strong 
support you have given to NIH, its Institutes and Centers. In spite of 
the very difficult funding decisions you have had to make in recent 
years, you held fast to your belief in investing in America's health. I 
know that you personally remain committed to the NIH and you worked 
with us, the Friends of the NICHD to coordinate a visit for 
appropriations staffers to the NICHD. Last winter we were able to bring 
nearly 50 appropriations staffers to the Bethesda campus where they 
were able to see first hand what it's like to be both a patient at NIH 
as well as a lab researcher. In addition, they were able to meet with 
and ask questions of Dr. Alexander and several researchers.
    It is our hope to expand that knowledge to all Members of Congress 
and their staffs in June when the Friends of NICHD will host, as part 
of the NICHD's 35th Anniversary year, a scientific exhibition and 
reception. This event will provide researchers, scientists and Member 
of Congress an opportunity to interact and answer questions about the 
research currently being conducted across the country with NICHD 
support.
    It is unbelievable to all of us to think that just two short years 
ago we had a budget deficit of $292 billion. Now, in 1998 we are 
hearing a different and exciting word--budget surplus. If in deed such 
a surplus exists, the Friends of NICHD would like to see surplus equal 
solutions.
    For 35 years, the NICHD has been providing solutions through basic 
and applied research. The NICHD devotes its research to ensuring the 
birth of healthy babies and the opportunity for each infant to reach 
adulthood and achieve full potential, unimpaired by physical or mental 
disabilities. This critical research provides solutions for the world, 
the nation, and the families that live in your town. In order to 
continue to find solutions, the Friends of NICHD recommend that the 
NICHD receive $776 million in funding for fiscal year 1999. We also 
support an overall NIH funding increase, as recommended by the Ad Hoc 
Group for Medical Research Funding, of 15 percent for fiscal year 1999.
    Through its broad mission, the NICHD is working to find solutions. 
The NICHD is structured by an intramural program, which largely targets 
basic research related to human development, and an extramural program 
which includes the Center for Population Research, the Center for 
Research for Mothers and Children, and the National Center for Medical 
Rehabilitation Research. NICHD also supports 15 Mental Retardation and 
Developmental Disabilities Research Centers which pursue both 
biomedical and behavioral research leading to understanding the causes 
of mental retardation and other developmental disabilities. The NICHD 
has long served as a strong example of an institute that looks not only 
to the physiological factors affecting health, but recognizes that 
behavioral research is essential to this strategy. NICHD supports 
psychological research ranging from studying ways to prevent 
developmental detours to understanding more about adolescent health and 
risk-taking behavior to finding ways for children with disabilities to 
lead more independent and productive lives. As Congress seeks more 
effective, less-costly solutions to many of today's issues and 
problems, NICHD-supported research offers highly relevant insights.
    I would like to share with you today some of the newest and most 
exciting solutions being discovered through NICHD research.
    Finding Solutions for Autism through Early Intervention: Recent 
work on brain development strongly suggests that early educational 
language instruction actually re-wires the brain of the developing 
child. Research designed to better understand the processes underlying 
neuroplasticity may make it possible to increase this window of 
opportunity for early intervention which is so critically important for 
children with disabilities. The NICHD has launched a major autism 
research program at Yale University, UCLA, University of Chicago, 
University of Pittsburgh, and the University of Washington. The 
research study is designed to provide a better understanding of ways to 
prevent and treat autism, and to provide a better understanding of ways 
to provide more targeted educational services to youngsters with autism 
spectrum disorders. It appears that many children in the early stages 
of autism spectrum disorders can be spared from developing the most 
seriously debilitating symptoms through intensive early language and 
social intervention.
    Finding Solutions for Genetic Disorders: Advances in genetics 
research methods have now made it possible to explore the relationship 
between genetic errors and specific behavioral and psychological 
consequences of those defects. Projects on Fragile X Syndrome, Rett 
Syndrome, Down Syndrome and others have made substantial strides in 
recent years. NICHD research at several leading universities have 
linked specific errors on human Chromosome 15 to highly specific 
behavioral disorders of major health importance. Research has shown 
that most people with Prader Willi Syndrome, a genetic disorder which 
also causes life threatening obesity, also have Obsessive Compulsive 
Disorder (OCD), a psychiatric disorder affecting 5 million Americans. 
Researchers are homing in on the critical region of Chromosome 15 to 
identify which genes in this region are responsible for specific 
aspects of this condition. Once the gene product is identified, the 
search for a more effective treatment, or even a cure is possible.
    Finding Solutions for Increased Research in Obstetrics and 
Gynecology: In late 1997 the NICHD announced plans to establish several 
new centers to foster training of young investigators in the field of 
obstetrics and gynecology. Establishment of these centers was supported 
by Congress when the committee report accompanying the House Labor/
Health and Human Resources/Education appropriations legislation for 
fiscal year 1998 urged NICHD to work with the NIH Office of Research on 
Women's Health to address the ongoing dearth of obstetric-gynecologic 
research. The intent, according to the report, is to offer financial 
assistance to would-be researchers to ``provide a bridge between their 
early training and their launching careers as independent 
investigators.'' NICHD believes that the approach used in these new 
``Women's Reproductive Health Research Career Development Centers'' 
will lead to an increased cadre of skilled clinicians and exciting new 
developments in obstetrical and gynecological care for women. NICHD 
plans to allocate approximately three million dollars to the new 
program, funding the first centers early this year.
    Finding Solutions for Premature Delivery: Researchers are 
identifying potential causes of premature birth which often leads to 
infant mortality or life-long disability. It increasingly appears that 
not only can a maternal infection cause amniotic infection, but that 
the actual impetus for the labor comes from the fetus itself. It 
appears that the fetus stimulates the initiation of labor as a means of 
protecting itself from a dangerous uterine environment. However, the 
resulting premature birth may pose an even greater threat to the fetus. 
NICHD research is developing a rapid method for detecting amniotic 
infection allowing clinicians to intervene with antibiotics more 
quickly to help eliminate the threatening intrauterine environment that 
triggers the labor-inducing response from the fetus.
    Finding Solutions for Sudden Infant Death Syndrome: As you well 
know, the NICHD is home to the ``Back to Sleep'' campaign. Prior to 
1994, when the campaign began, there were approximately 5,000 infant 
deaths annually due to SIDS. Through a combination of research and a 
public education campaign, the SIDS death rate has been reduced since 
1992 by 38 percent. In fact, the latest data in from the State of 
California shows a 50-percent decline in SIDS related deaths. This 
remarkable public/private information campaign has, along with other 
advances from NICHD, had a profound effect on the infant mortality rate 
of this country which dropped from 26.0 deaths per 1,000 live births in 
1960 to 7.2 deaths per 1,000 live births in 1996, the lowest rate ever 
recorded in the United States.
    Finding Solutions for Risky Adolescent Behavior: We all know that 
adolescence for many can be a healthy and exciting time of life. But 
for others, it can be a stressful, difficult time that can lead teens 
to engage in risky behaviors with possible life-long consequences. 
There is good news, however. A recent NICHD-supported study has found 
that adolescents who are emotionally connected to their families and 
schools are consistently healthier than those who are not. These 
adolescents suffer less from emotional distress, are less likely to 
smoke, drink, or use marijuana, less likely to begin having sexual 
intercourse at an early age, less likely to be involved in violence, 
and less likely to consider or attempt suicide. Emotional connectedness 
to family and school was found to be more strongly protective of health 
than specific parenting behaviors or school characteristics. The study 
also found that adolescents who had easy access to guns at home were 
more likely to be involved in violence and to consider or attempt 
suicide; and those with easy access to alcohol, tobacco, and illegal 
drugs within the home were more likely to use the substances.
    The above information was gleaned from the National Longitudinal 
Study of Adolescent Health (Add Health). This study is the first 
nationally representative and comprehensive study of the factors that 
promote health and healthy behavior among young people. NICHD funded 
the study with collaboration from 17 other NIH institutes and federal 
offices in response to a directive in the 1993 NIH Revitalization Act. 
Using a unique design, the study collected data to show the impact of 
school, family, peer group and neighborhood influences on health over a 
two-year period. Study data have been made available to researchers 
nationwide to investigate protective and risk factors in the lives of 
youth.
    Finding Solutions for Better Learning and Reading: Approximately 10 
million children have difficulty reading. In order to find the causes 
and develop solutions to this problem, the NICHD has supported research 
in neuroimaging using a variety of computerized tools and has helped to 
identify core cognitive, genetic, and neurobiological defects involved 
in reading disabilities. Over the years, NICHD-supported scientists 
have found that reading disabilities represent a disorder of language, 
and more specifically, an impairment in a child's ability to process 
phonemes, or individual bits of sound. Using this knowledge, the 
researchers have developed a number of prevention and remediation 
programs to help children at risk for reading disabilities. This 
approach is now providing the basis for reading intervention programs 
in classrooms in Houston, Texas; the District of Columbia; Atlanta, 
Georgia; Tallahassee, Florida; Boston, Massachusetts; Boulder, 
Colorado; Seattle, Washington; and throughout California.
    Finding Solutions to Prevent Osteoporosis and Bone Mass Loss: 
NICHD's Milk Matters public awareness campaign is targeting youngsters, 
with a special focus on adolescents and young women, to increase 
calcium intake to prevent against bone mass loss and osteoporosis. 
Recent NICHD studies show that a ``window of opportunity'' exists to 
add to the bone bank during the teen years. NICHD researchers have 
found that supplementing the diets of girls, ages 12 to 16, with an 
extra 350 mg. of calcium produced a 14-percent increase in their bone 
density, in comparison to unsupplemented girls. If this 14-percent 
increase in bone density could be maintained, its impact would be 
striking--for every 5 percent increase in bone density, the risk of 
later bone fracture declines by 40 percent. However, without continued 
supplementation, it appears the added bone density could be lost. The 
NICHD's campaign is educating parents and physicians about the 
importance of including the appropriate amount of calcium in the daily 
diets of young children and adolescents. Using print media, the milk 
mustache ads, NICHD is educating young people and showing them that 
it's ``cool'' to drink milk.
    Mr. Chairman, as you are well aware, the above mentioned examples 
are but a few highlights of work currently being done at the NICHD. So 
much more remains to be done. As the nation moves toward the new 
millennium, the NICHD plans to support an array of major efforts that 
not only fall into the important NIH areas of emphasis, but hold great 
promise for improving the health and the quality of life of the 
nation's children and families. With birth defects the leading cause of 
infant mortality, and contributing greatly to lifelong disabilities, 
the NICHD will expand support of grants studying the complex mechanisms 
controlling the normal and abnormal development of organs and the 
nervous system, including studies using the latest computer-assisted 
technologies. Similarly, researchers now understand that the biologic 
origins of such serious adult chronic diseases as diabetes and 
hypertension stem from multiple genetic sources. By supporting projects 
that will scan the human genome to identify and map multiple variations 
in the coding sequences and regulatory regions of the genes that might 
contribute to a chronic disease, researchers may be able to develop 
tests that can identify children at risk for the disease later in life.
    NICHD will focus significant efforts to prevent children and 
adolescents from experiencing adult diseases and disabilities. Work 
will continue to develop vaccines for tuberculosis and E. coli 0157, 
helping to improve the safety of our food supply. The number of 
research units providing the infrastructure to test a wide range of 
pediatric drugs will expand, and interventions to prevent our children 
and youth from smoking and driving recklessly are planned.
    Additionally, the NICHD is in a unique position to find innovative 
ways to improve the quality of life for persons with disabilities. One 
initiative will support full-scale clinical trials that will test 
promising new methods to improve the ability of persons with incomplete 
spinal cord injury to once again walk. Scientists will also be 
encouraged to develop novel materials that can serve as biodegradable 
scaffolding for tissue and organ regeneration, replacements for lost 
structures, novel prostheses, and even the basis to form artificial 
ones may become reality.
    President John F. Kennedy, whose efforts helped to establish the 
NICHD said, ``We have conquered the atom, but we have not yet begun to 
make a major assault on the mysteries of the human mind.'' We have come 
a phenomenally long way since President Kennedy made that statement in 
1961. But there is a long road ahead. With the continued strong support 
and leadership of this Subcommittee we can launch a major assault on 
many of the mysteries that affect our health. We thank your for your 
leadership which offers healthier futures for all of our children. 
Thank you.
                                 ______
                                 
        Prepared Statement of the American Physiological Society
    The American Physiological Society appreciates the opportunity to 
submit its views on fiscal year 1999 funding for the National 
Institutes of Health for the record. The APS appreciates the very 
strong support this Subcommittee has provided to the NIH in the past. 
Its phenomenal growth and impressive record of scientific discovery has 
been possible because of your efforts on its behalf.
    The American Physiological Society (APS) is a academic society 
comprised of scientists who study fundamental processes in cells, 
tissues, and organs as well as their integration into the whole, living 
organism. The APS was founded in 1887 and now has more than 8,700 
members. The majority of our members conduct research and educate the 
next generation of physicians and scientists at colleges, universities, 
medical schools throughout the U.S. Others are engaged in research and 
related activities in industry and government.
    The American Physiological Society (APS) supports current efforts 
to bring about a doubling of the NIH budget. Specifically, we support 
the goal of a 15-percent increase in fiscal year 1999 as recommended by 
the Federation of American Societies for Experimental Biology and by 
the Ad Hoc Group for Medical Research Funding. We believe that 
important scientific opportunities are waiting, and NIH should be given 
the means to pursue them as rapidly as possible.
    The ambitious ``Human Genome Project'' to identify the estimated 
100,000 genes that comprise the genetic map of the human being is 
nearing completion. We must begin preparations now to take the next 
step to find out what these genes do and how they affect our health.
    Research directed at determining the functions of various genes has 
already been undertaken in certain bacteria, plants, and relatively 
simple animals such as the fruit fly and zebra fish, whose genetic maps 
and genomes have been developed in parallel with the human genome. 
Thanks to these efforts we have learned that many genes operate 
similarly in different plants and animals. This means that we can use 
information about genetic function in lower organisms as a starting 
point to figure out how particular genes affect human health. In some 
cases, it is not one gene but combinations of two, three, or more genes 
that cause a health problem or determine what course it may take.
    The APS believes that NIH should lead the way in making it possible 
to use the findings of the Human Genome Project to provide tangible 
benefits for human health. At a February, 1997 meeting at the Banbury 
Conference Center at Cold Spring Harbor, NY, the American Physiological 
Society brought together a group of internationally renowned. academic 
and industry scientists with expertise in molecular genetics, 
physiology, and pharmacology to discuss what needs to be done now to 
translate what we know about human genes into medical knowledge.
    The participants at the Banbury Conference identified the need for 
a ``Genes to Health Initiative'' to lay the groundwork. This initiative 
would bring together scientists representing disciplines such as 
molecular genetics (to identify genes and determine their molecular 
function); physiology (to discover how genes function in living 
organisms); pharmacology (to understand how and why certain drugs work 
differently depending upon what genes or combination of genes are 
causing a disease); medical informatics (to develop ways to use 
advanced computer technology to collect and share this mass of 
information); and clinical scientists (to identify and address the 
manifestations of complex hereditary diseases).
    This is a new area of medical science, and many gaps in our 
knowledge must be filled before we can proceed to commercial 
development of the next generation of diagnostics, preventatives, and 
therapies. The APS believes that the health interests of the American 
people will be best served if the NIH leads the way in this important 
next step in the Human Genome Project. NIH's guiding principle is 
scientific excellence in service to public health. The NIH's 
involvement at this stage will provide assurance that public health 
concerns are given priority.
    The Genes to Health Initiative represents an important area with 
implications for understanding and treating many different diseases and 
health problems. The APS respectfully urges you to provide the NIH with 
new funding in fiscal year 1999 and to encourage it to undertake new 
initiatives such as this one and once again thanks this Subcommittee 
for its strong support of the NIH.
                                 ______
                                 
       Prepared Statement of the American Optometric Association
    The American Optometric Association represents over 33,000 
practicing Doctors of Optometry across the Nation. As a profession 
devoted to improving the vision care and health of the public, doctors 
of optometry provide preventive and remedial services for diseases and 
disorders of the vision system, the eye and associated structures as 
well as the diagnosis of related systemic conditions.
    The American Optometric Association supports the goal of NEI 
conducting research for new treatment and cures for eye diseases, 
visual disorders, and the preservation of sight. Since the NEI was 
founded in 1968, optometrists have been active participants in projects 
managed by the Institute, the results of which have improved the 
quality of life for American citizens.
    We applaud the research achievements of NEI over the past 30 years 
and support efforts to double the NIH budget over the next 5 years. We 
urge you to provide a 15-percent increase in fiscal year 1999 for the 
NIH as the first step toward doubling the budget. Furthermore, we urge 
you to provide $408.6 million, a 15-percent increase, for NEI in fiscal 
year 1998 as requested by the National Advisory Eye Council in its 
``Citizens Budget Proposal''.
    Vision and eye health problems are the second most prevalent, 
chronic, health care problem in the U.S. population, affecting more 
than 120 million people. Visual disorders reduce the educability of the 
child and hasten the loss of independence in the elderly. Visual 
disorders and disabilities impose billions in direct and indirect costs 
on our society each year.
    Finding a cure for vision disorders and eye diseases is essential 
to prevent consequent handicaps. The two age groups at highest risk for 
vision problems are children and the elderly.
    Fear of blindness is second only to fear of cancer among our 
nation's elderly. Vision and eye health problems increase significantly 
in frequency and severity with age and are more prevalent in those over 
60. Vision problems among the elderly are often a key reason for the 
abandonment of independent living and frequently require rehabilitative 
services. Over 1.1 million Americans are legally blind; over 12 million 
Americans suffer from some form of irreversible visual impairment. No 
part of an individual's life is free from some risk to their vision.
    The annual cost of eye and vision disorders is $38.4 billion. 
Adequate visual rehabilitation can reduce the costs to individuals and 
society for lost wages and welfare payments. While research support by 
NEI has made advances in developing effective optical aids to maximize 
remaining vision, there is much research that still needs to be done.
    The NEI has conducted and supported research which has resulted in 
the early diagnosis and prompt treatment of eye diseases. Age related 
macular degeneration (AMD) is the most common cause of severe visual 
impairment in older Americans. Approximately 1.7 million have decreased 
vision and 100,000 are blind from the disease. While there is currently 
no cure for AMD, NEI is conducting research to test new treatments 
including the effects of antioxidants on the progression of AMD.
    A related area of concern is low vision which is broadly defined as 
any chronic visual condition that is not correctable by glasses or 
contact lenses that impairs everyday functioning. The leading causes of 
low vision are diseases that are common among older adults: age-related 
macular degeneration (AMD), cataracts, glaucoma and diabetic 
retinopathy.
    There are many areas in low vision in which further research is 
merited. One which deserves particular mention is the advancement of 
technology and assistive devices to help those with visual impairments 
to carry out everyday functions as independently as possible. Issues to 
explore include providing sufficient training in the use of these 
devices, reducing their cost, and improving the functionability and 
appearance of these devices if they are to be accepted by users. 
Researchers remain frustrated because advances in low vision devices 
seem not to be reaching the people with impairments, in part because of 
a lack of insurance coverage for evaluations and devices. Scientists 
are researching better ways of presenting hard to read computer graphic 
user interfaces, and developing telescoping and other optical devices 
to improve intermediate distance tasks and peripheral vision.
    Most people with chronic eye conditions have residual vision and 
with the aid of devices and rehabilitation, can maintain an 
independent, productive way of life. While low vision rehabilitation 
services and devices are available, most people with low vision do not 
appear to be aware of their availability or use them. To address this 
problem, NEI, under the auspices of the National Eye Health Education 
Program (NEHEP), is working on a national program directed at low 
vision in order to increase public awareness about visual impairment 
and the impact it has on the quality of life. The program will provide 
information about low vision services and the devices available to 
assist those with visual impairment. As a partner organization with 
NEHEP, the American Optometric Association supports this public 
education program and encourages the committee to support it as well.
    The NEI has funded a clinical trial planning grant to study 
screening tests to identify 3 year old children in need of vision care 
for amblyopia (``lazy'' eyes), strabismus (crossed eyes) and 
significant refractive errors. The NEI budget should permit funding of 
grants at a high level in the areas of strabismus, amblyopia and 
refractive errors. Since more than 120 million Americans wear glasses, 
research in the cause and prevention of refractive error and visual 
function should continue.
    The value of clinical trials to the public cannot be overestimated. 
NEI has a remarkable record of scientific breakthroughs attributed to 
clinical trial research beginning with the diabetic retinopathy study 
in the 1970s. By identifying the appropriate treatment for diabetic 
retinopathy which prevents the loss of vision, enough public dollars 
are saved each year to pay many times over the cost of treatment as 
well as the cost of conducting the trial. NEI clinical trials involve 
many institutions, hundreds of health professionals and thousands of 
patients.
    We recognize the importance of research in eye conditions which 
have a greater prevalence in the elderly, but also encourage 
substantial funding to continue research progress in the area of 
children's vision. Children are at high risk because of the impact of 
uncorrected vision handicaps on their educational and developmental 
progress. Vision problems may interfere with a child's ability to 
learn. Although a number of studies have suggested a significant 
relationship between visual functioning and reading, a randomized, 
prospective, multi-center clinical trial is needed to evaluate 
treatment therapies.
    We support NEI's research of the eye complications from acquired 
immune deficiency syndrome (AIDS). The results from NEI researchers 
demonstrating the effectiveness of drug therapy against CMV retinitis 
in people with AIDS is very encouraging in the fight against this 
public health problem. It is important that research dollars continue 
to support research activities to prevent, treat and cure AIDS.
    Optometric researchers are grateful for the commitment that 
Congress has demonstrated to the NEI and its mission. The investment 
made in eye/vision research has paid great dividends to the American 
people through major breakthroughs in eye care and vision. Yet, there 
is still much more to be done to preserve and enhance vision. We 
encourage this committee to continue its commitment to NEI and eye/
vision research by providing the $408.6 million funding level 
recommended in the citizens budget. Thank you again for the opportunity 
to present this testimony.
                                 ______
                                 
  Prepared Statement of Mary Kaye Richter, on Behalf of the National 
                  Foundation for Ectodermal Dysplasias
    I greatly appreciate having the opportunity to appear before you 
this afternoon. My name is Mary Kaye Richter. I am the Executive 
Director of the National Foundation for Ectodermal Dysplasias, a former 
member of the Board of Directors of the National Organization for Rare 
Disorders and a member of the Board of the National Alliance for Oral 
Health. Today, I am appearing on behalf of one hundred thousand men, 
women and children who are affected by conditions known as ectodermal 
dysplasias and millions of children and adults affected by other rare 
disorders.
    Through this hearing process, you will listen to many individuals, 
including myself, who espouse the doubling of the budget for the 
National Institutes of Health within the next 5 years and to begin that 
process with a 15-percent increase fiscal year 1999. Sufficient funding 
of scientific and clinical research is the cornerstone upon which 
dynamic improvement in our understanding of disease and disease 
processes must be built. While some people would encourage you to 
earmark dollars for specific disease entities, I would urge you to 
leave such decisions with the National Institutes of Health leadership, 
which is in the best position to do so. It would indeed be unfortunate 
if research funding was prioritized by the effectiveness of lobbying 
rather than the effectiveness of science.
    For a moment, I would like for you to consider what it must be like 
to have an infant affected by a condition about which no one can tell 
you anything. You and everyone near you, including your physician, have 
a feeling that all is not right, but no one has an idea of what may be 
happening. There is no doctor to confirm a diagnosis, no resource to 
which you can go for information and no hint of what should or could be 
done. As frightening as such thoughts may be, thousands and thousands 
of families encounter this scenario each year.
    Such is frequently the case for families faced by the challenges of 
ectodermal dysplasia (ED). In a nutshell, the ectodermal dysplasias are 
genetic conditions that are identified by abnormalities in derivatives 
of the ectoderm. The hair, teeth, sweat glands and nails are affected 
in these conditions of which there are more than 150 variations. Some 
of the syndromes are mild in their affects and others are devastating. 
The most common form of the condition is hypohidrotic ectodermal 
dysplasia which is identified by sparseness of hair, absence of sweat 
glands and many missing teeth. While a diagnosis is relatively easy in 
families with a history of the condition, diagnosis is extremely 
difficult in families where the condition has not previously appeared. 
It is estimated that more than 100,000 people are affected by these 
conditions.
    Once the diagnosis of a rare condition has been made, families 
encounter more challenges as they search for useful treatment 
information and knowledgeable care providers. Only the savviest will 
make their way to organizations like ours. What happens to those 
families for whom no advocacy organization exists? What happens when 
there are no available clinicians to make a diagnosis? What happens 
when the effects of a condition exacerbate as a result of a lack of a 
diagnosis? What happens when there is no place to turn and you have no 
hope? How does it feel to bury a child? The answers to these questions 
are illusive-not because of a lack of concern on our parts but rather 
because we seem unwilling to do those things that must be done in order 
to give appropriate answers.
    In 1988, the National Commission on Orphan Diseases conducted a 
survey that indicated that 15 percent of the families affected by rare 
conditions endured more than five years of searching before arriving at 
a diagnosis. Another 31 percent of families indicated that their search 
for a diagnosis lasted for more than a year. Only 51 percent of such 
families, suggested that their diagnosis was received in a timely 
manner of less than a year. Just this week, I talked with a mother in 
Chicago whose daughter is experiencing problems so severe that the 
child has been removed from school. In spite of visits to several 
premiere institutions within the U.S., no one can explain what may be 
happening. Meanwhile, her symptoms exacerbate. Earlier this month, a 
seventeen-year-old from New York died as a result of complications 
associated with ectodermal dysplasia about which nothing is known.
    There is an office that is in a position to make a difference for 
families in such dilemmas, the Office of Rare Diseases (ORD) within the 
National Institutes of Health. However, funding for the office has been 
woefully inadequate, preventing the kinds of accomplishments that are 
needed. The ORD could play the critical role of pivot point for the 
operation of Diagnostic Research Centers.
    As mentioned earlier in this testimony, nearly a majority of those 
affected by rare conditions do not receive a diagnosis within a year. 
For many, a 5-year wait can be expected. Currently, there are 75 
General Clinical Research Centers, 6 Pediatric Clinical Pharmacology 
Research Centers and many special research centers as identified by 
individual Institutes across the United States. I am asking you to 
consider funding that would enable the Office of Rare Diseases to 
select a minimum of 15 Diagnostic Research Centers that would focus on 
the diagnosis and treatment of rare conditions. With such a network in 
place, real progress can begin. Families who are desperate for 
diagnosis will travel to any length to unlock the mystery of a child's 
condition. Such centers, geographically dispersed, would be a giant 
step forward. Between 20 to 25 million patients with 6,000 rare and 
genetic disorders in the United States are waiting for the hope and 
help only the Congress can provide.
    A key function of the Office of Rare Diseases is the sponsorship of 
scientific workshops. These may be done with cooperation from 
applicable research Institutes and Centers at the National Institutes 
of Health. Workshops enable the following outcomes.
  --Establish research priorities;
  --Develop research goals;
  --Establish collaborative research assignments;
  --Provide support to develop patient and tissue registries;
  --Develop plans to initiate clinical trials;
  --Create animal models for research;
  --Prepare program announcements to solicit research grant 
        applications;
  --Establish criteria for diagnosing and monitoring rare diseases; and
  --Inform targeted professional and voluntary organizations through 
        published proceedings.
    One workshop, held just more than one year ago, focused on the 
ectodermal dysplasias. The success of the event provides ample evidence 
of the benefits of such workshops. The ectodermal dysplasias are 
conditions of interest to several of the Institutes, namely the 
National Institute for Dental Research, the National Institute for 
Arthritis, Musculoskeletal and Skin, the National Child Health and 
Development Institute as well as to the Office of Rare Disease 
Research. In 1996, all of these groups joined together to hold the 
first ever scientific symposium to discuss ED.
    The event attracted outstanding researchers from the U.S., Canada 
and Europe. The symposium was a revelation to the attendees, as the 
overlap of key biological issues became apparent. It is clear that 
improved understanding of the developmental biology associated with ED 
will help unlock the doors of knowledge to the growth of hair, nails 
and teeth and the function of sweat and sebaceous glands. While most 
members of Congress would not clamor for research into ED, they could 
appreciate the value of science that may ultimately grow hair where 
none was present, replace teeth with human biological material rather 
than metal or plastic or find a way to maintain normal body 
temperature. Such solutions could well be the result of scientific and 
clinical research into ectodermal dysplasia.
    Not only did the meeting serve as a stimulating exercise for those 
individuals who participated, it also served as a springboard for 
scientific research. This spring, the NFED will award a minimum of 
$50,000 in grants to winners in our current competition. Our hope is 
that our grants can serve as a bridge to enable researchers to gather 
sufficient data to successfully compete for N.I.H. funding. An example 
of such success is that of Jonathan Zonana, a genetic researcher at 
Oregon Health Sciences University. With funding from the NFED, he 
secured sufficient data to obtain funding from N.I.A.M.S. and the 
N.I.D.R., which ultimately led to the identification of the gene for x-
linked hypohidrotic ectodermal dysplasia. Currently, we are providing 
similar bridge grants, which are aimed at finding the genes for 
Clouston's ectodermal dysplasia and ectrodactyly-ectodermal dysplasia-
clefting, an especially troublesome syndrome.
    Currently, the ORD sponsors or co-sponsors approximately 30 
workshops per year. With thousands and thousands of rare conditions, 
the number of workshops must be increased to give more of those 
individuals affected by these syndromes some hope that attention will 
be given to their disorder sometime in their life time. Increasing the 
budget of the ORD by just $500,000, for workshops, would significantly 
increase the number of rare disorders that are examined.
    The Office of Rare Diseases could also serve as a much-needed focal 
point for information relative to which doctors and researchers are 
doing work with a particular rare disease entity. Currently, families 
can only guess where they might go for help. How much better it would 
be to have a resource at hand that could elucidate critically needed 
care and research information. Currently, the ORD has a budget of $1.6 
million dollars. I implore you to make this office what it needs to be 
by increasing its budget to $4.8 million dollars-a pittance when 
compared to some amounts being spent on some individual single 
conditions.
    The operation of and funding for the Rare Disease Office is of 
importance to families affected by rare conditions but so is the 
funding for individual divisions of the National Institutes of Health. 
Both scientific and clinical research are needed to improve our 
understanding of and treatment for rare disorders. It is important to 
remember that although a condition being investigated may be rare, it 
may have tremendous impact on a large number of individuals. For 
example, several years ago, the National Institute for Dental Research 
sponsored a program in its clinical center whose researchers placed 
osseointegrated dental implants into the jaws of nearly fifty 
individuals affected by ED. Not only did the project underscore the 
value of implants in edentulous adults, it also supported the procedure 
for use in children. The procedure was found to be safe and 
efficacious. The children and teens that participated in the program 
will tell you that it also enabled them to eat any food that they chose 
instead of being limited to soft foods. It allowed them to speak with 
classmates without fear that their dentures would slip and also 
prevented them from embarrassment from things so simple as a first 
kiss. The implants gave them a freedom they had never known.
    It was your support for the National Institute for Dental Research 
that made the research possible and your support that helped improve 
our understanding of the use of implants for anyone missing a tooth. It 
is also important to note that the research at the National Institute 
for Dental Research has had an additional benefit. Now, thanks to 
cooperation from several outstanding dental schools, their staffs and 
Implant Innovations, Inc. and Nobel Biocare, both manufacturers of 
implant components, the NFED offers special implant programs at the 
dental schools associated with Southern Illinois University, the 
University of North Carolina and the University of Washington. The 
private sector has now picked up that which was begun in the public 
sector. Collaborative efforts between the public and private sectors 
can provide an increasingly exciting opportunity. However, in our case, 
the collaboration is fruitless unless the public sector plays a 
preliminary and meaningful role. Our organization would never have been 
able to put our program into place if the extraordinary work had not 
been done at the Dental Institute.
    Although the bulk of my testimony is devoted to funding for the 
National Institutes of Health, the value of the General Dentistry 
Residency program is worthy of comment. It is our hope that this 
program can be sufficiently funded to include funding for Pediatric 
Dentistry Training as the reauthorization proposal suggests. The 
program not only improves the depth of training for dentists but also 
enables individuals needing specialized care to identify practitioners 
and programs where help may be available. On nearly a daily basis, our 
office receives calls from individuals needing extraordinary oral 
health care who have difficulty in finding qualified clinicians to 
provide the care. While insurance companies may have us believe that 
teeth are only cosmetic, as their frequent denial of benefits 
indicates, nothing could be further from the truth. Diet, speech, self-
esteem, student success and employment are all impacted by the 
condition of the mouth. When all that is present in the mouth are a 
couple of fangs, as in ectodermal dysplasia, or teeth worn down to the 
gum line, as in osteogenesis imperfecta, all of life is affected. The 
General Dentistry Residency program serves as a beacon of hope to those 
needing care. We support the position of the American Association of 
Dental Schools for funding of at least $4.0 million with the caveat 
that additional funds be added should the reauthorization include 
Pediatric Dentistry Training.
    Basic scientific research is also of great interest to us. We are 
especially concerned about funding in this area for both the National 
Institute for Dental Research and the National Institute for Arthritis, 
Musculoskeletal and Skin. I remember a time when I used to dream about 
the day when my own son could eat an apple or bite into a steak. Thanks 
to the National Institute for Dental Research and its implant research 
those dreams have come true. But I also dream of young children who 
would like to play baseball, who would love to throw their arms around 
Mickey Mouse at Disney World or play on a jungle gym with friends. When 
they are unable to perspire, such children find all of their activities 
hampered. Our families have every reason to fear the potential of heat 
stroke that accompanies their everyday activities.
    An absence of hair, most often thought of only in terms of mature 
men with male pattern baldness, is an even more significant problem for 
children. This is especially so when wearing a wig compounds the 
problems of overheating. Little girls should have ribbons and bows to 
wear in their curls, not baldheads with wisps of uncontrollable, coarse 
hair. And young boys should not have to fear taking off a cap, the 
doing of which may reveal an embarrassing lack of hair. Basic 
developmental research can help identify the mechanism that makes hair 
grow and ultimately lead to hair growth for all that desire it.
    One last concern that I would like to share with you is inadequate 
funding for investigators who begin their research careers as fellows. 
During their tenure, exciting projects may begin for which financial 
support is lost at the end of the fellowship. As a result, promising 
research comes to an end just when preliminary documentation is 
beginning to bear fruit. In the case of rare diseases, just when 
families have hope that a researcher is beginning to make strides in 
understanding of the condition, the hope diminishes when funding ends 
and the fellow must leave. There is also the question of what happens 
to the research when the fellow leaves an Institute. If there is no 
replacement to carry on the work, all can be for naught. There needs to 
be a system whereby fellowships, involving rare disorders, can be 
extended with adequate financial support when warranted. Wasted effort 
benefits no one.
    My list could go on and on. Congressman Porter, I know that you are 
well aware of the anguish of parents whose children are affected by 
rare conditions. My hope is that you and members of this committee will 
encourage your peers to support a doubling of funding for our jewel of 
government, the National Institutes of Health. My hope is that you will 
spearhead an effort to increase the role and budget of the Office of 
Rare Diseases. And my hope is that you will allow those individuals in 
a position to make sound decisions relative to the spending of research 
dollars to do so at the National Institutes of Health. Please do not 
succumb to the desires of individuals who lobby for earmarked funding 
for specific conditions. All that those of us challenged by rare 
disease want is a fair chance at a better tomorrow for our children.
                                 ______
                                 
   Prepared Statement of Michele and Ryan Licursi, on Behalf of the 
     Foundation for Ichthyosis and Related Skin Types (F.I.R.S.T.)
    My name is Michele Licursi. I am testifying as a mother and a 
representative of the Foundation for Ichthyosis and Related Skin Types 
(F.I.R.S.T.). I have been a Regional Support Network (RSN) Coordinator 
with F.I.R.S.T. for 3 years.
    Testifying with me today is my son Ryan. He has a type of 
ichthyosis called Epidermolytic Hyperkeratosis (EHK).
    I wish to thank the subcommittee for this opportunity to testify 
regarding funding for skin disease research and the budget of the 
National Institute of Arthritis, Musculoskeletal and Skin Diseases 
(NIAMS).
    The Foundation for Ichthyosis and Related Skin Types (F.I.R.S.T.) 
is a voluntary organization dedicated to providing support, 
information, education and advocacy for individuals and families 
affected by ichthyosis. F.I.R.S.T. supports research into causes, 
treatment and a cure for ichthyosis.
    The Foundation receives no grants or sub-grants, and no contracts 
or sub-contracts, from the federal government. It does receive 
contributions of approximately $2600.00 per year from federal employees 
through the Combined Federal Campaign (CFC).
    Ichthyosis is a family of genetic skin diseases characterized by 
dry, thickened, scaling skin. These diseases are caused by genetic 
defects that are usually the result of genetic inheritance. Currently, 
there is no cure for ichthyosis, and there are no truly effective 
treatments.
    Epidermolytic Hyperkeratosis causes the skin to be very fragile. 
The slightest bump can cause the skin to break away. Blisters are 
common. They can be spontaneous or the result of a sleeve, a sock, or a 
collar touching the skin. Scaling and flaking are continuous. The skin 
is tight and cracks. The palms and soles are thick, making something as 
simple as holding a pencil or as natural as walking difficult and 
painful. Overheating is dangerous and infections are a constant threat. 
We are experts now, but 12 years ago, like most people, we had never 
even heard of ichthyosis.
    We learned together the hard way. We found out that diapers rubbed 
the skin off of Ryan's legs, that car seats and high chairs had to be 
lined with sheepskin, that his daily skin care routine took several 
people and a couple of hours. Relatives had to be taught how to pick 
him up and how to hold him. We no longer shopped for cute little 
outfits. We looked for any clothes that his skin would tolerate. Shoes 
were out of the question for years and still continue to be a big 
problem.
    Ryan has been hospitalized for infections. Simple medical 
procedures are complicated. Our days and activities are planned around 
his skin care. We get stares and questions from strangers. Most are 
trying to be nice, but many are rude, accusing us of all kinds of child 
abuse. While the physical aspects of ichthyosis are obvious, the blows 
to ones self esteem can be even more damaging.
    I am very thankful for the support we received from other members 
of F.I.R.S.T. We were lucky to find F.I.R.S.T. very early in Ryan's 
life and the advice and concern we received helped us find our way. As 
a coordinator for the RSN, I talk with people in different stages of 
coping with ichthyosis. I talk with new parents who are shocked to 
learn that their baby's skin could have such problems and be such a 
threat and now have to learn how to care for them. I talk with parents 
who share their child's heartbreak as they try to socialize and fit in, 
or when they refuse to socialize because of embarrassment. I talk with 
parents of teenagers who are rebelling and refuse to care for their 
skin properly, thereby making things worse. I talk with young adults 
who are experiencing difficulties in school or the workplace. I talk 
with people struggling with the cost of topical treatments not covered 
by insurance. I talk with adults who are guilt ridden because they have 
passed this condition on to their new baby. Currently ichthyosis is a 
life-long battle. Hopefully, this will change in the future.
    School has been great and Ryan has lots of good friends, but that 
is not the case with many kids with ichthyosis who are not as outgoing 
and confident as Ryan. Confident enough to tell you a little bit about 
living with Epidermolytic Hyperkeratosis (EHK).
    Ryan Licursi: Hello, I am twelve years old and in seventh grade. As 
you know, I have Epidermolytic Hyperkeratosis and it stinks. There are 
many things that other kids can do that I can't because of my skin. It 
is very dry and fragile, and I blister very easily. Any contact sport 
is out. I can't be on a basketball team because if anyone bumps into 
me, or knocks me over, my skin will rip. I can't be on a soccer team 
because if someone kicks me or I get hit with a ball, my skin will come 
off. I often have blisters on my feet. I can hit the ball in baseball, 
but getting around the bases is another story. I'm always the last one 
picked for teams in gym class. In winter, I even have trouble writing 
because the skin on my hands gets stiff and cracks.
    Another problem with having EHK is that every day I have to get up 
an hour earlier than other kids in order to soak in the tub for a half 
an hour, have cream put all over my body, and let it soak in before I 
put on my clothes. If I didn't do this each day, I would be so stiff 
and dry that I could not stand it. It hurts to do it, but it would be 
worse if I didn't.
    People in my town and my school know me and understand my physical 
condition, but when I go to the mall or any other public place, people 
stare and make comments.
    Any place I go, I leave a trail of skin. You'll know that I was 
sitting in this chair. I would really appreciate any research that can 
be done to cure this condition.
    We recognize this Subcommittee's strong history of bipartisan 
support for medical research funding and the NIH. In 1992, researchers 
identified the sites of two genetic mutations that account for 70 to 80 
percent of all cases of EHK. Since that time, genetic mutations that 
cause several other forms of ichthyosis have been identified and 
scientists and physicians have a better understanding of the disease 
process.
    We are excited about this progress, and about the current research 
into gene therapy. We are hopeful about the possibility for an 
effective treatment or cure on the horizon, but at this point it is 
still just hope. We continue to be frustrated by the lack of effective 
treatment options.
    We are also discouraged by the lack of available testing 
facilities. Genetic testing is possible today for the types of 
ichthyosis for which the specific mutations have already been 
identified. However, with the exception of one of the milder forms of 
ichthyosis, (Recessive X-linked Ichthyosis) testing is only being done 
on a limited research basis and there are no clinical laboratories that 
routinely offer these services. These tests are complex and time 
consuming (in some cases the particular genes are difficult to work 
with). However, they can provide valuable information for the purposes 
of genetic counseling (for carrier detection in certain recessive forms 
of ichthyosis and risk of recurrence) and pre-natal diagnosis. They can 
also help to plan appropriate intervention for those at risk for labor 
and delivery problems and premature birth that are common with some 
forms of ichthyosis.
    The Foundation for Ichthyosis and Related Skin Types (F.I.R.S.T.) 
urges a 15-percent increase in NIH funding in the next fiscal year, 
which would allow NIAMS to support a greater number of worthy research 
projects, conduct more clinical trials and expand it's intramural 
research program.
    F.I.R.S.T. also supports increased investment in translational 
research, which would build upon this new scientific knowledge to 
develop practical applications for those with ichthyosis and other skin 
diseases. The recent discovery of many of the genes involved in 
specific skin diseases is just the starting point for improving 
diagnosis and treatment.
    In 1992 a member of F.I.R.S.T. testified before this committee 
regarding the need for a national registry. Today, as a direct result 
of your interest and support, we have the National Registry for 
Ichthyosis and Related Disorders. To date, several hundred patients, 
and their physicians have participated in the detailed enrollment 
process, and enrollment is proceeding at an ever increasing rate. The 
registry helps generate researcher interest in ichthyosis, and provides 
investigators with an essential tool--a pool of affected individuals 
with a confirmed clinical diagnosis. The availability of this pool of 
information results in significant savings in research time and dollars 
which would have normally been spent identifying eligible patient 
populations.
    Current funding for the National Registry for Ichthyosis and 
Related Disorders expires in 1999, but the work of the registry must 
continue. Continued funding of the skin disease registries will ensure 
that these resources will be maintained and will continue to be a 
valuable tool for investigators.
    On behalf of our members, those with ichthyosis and their families, 
we thank this Congressional Subcommittee for their time and attention.
                                 ______
                                 
   Prepared Statement of W. Bruce Fye, M.D., M.A., F.A.C.C., Chair, 
  Cardiology Department, Marshfield Clinic, on Behalf of the American 
                         College of Cardiology
    The American College of Cardiology (ACC) is a professional medical 
society and educational institution whose mission is to foster optimal 
cardiovascular care and disease prevention through professional 
education, promotion of research, and leadership in the development of 
standards and guidelines and the formulation of health policy. I am W. 
Bruce Fye, M.D., M.A., chair of the cardiology department at Marshfield 
Clinic, a 525 physician multi-specialty group practice in Central 
Wisconsin. As chair of the ACC's Government Relations Committee and the 
ACC's historian, I am pleased to present to the Subcommittee the views 
of the College on behalf of its 24,000 members with respect to fiscal 
year 1999 funding for the National Heart, Lung, and Blood Institute 
(NHLBI).
    This year the NHLBI celebrates 50 years of accomplishments in the 
prevention, diagnosis, and treatment of cardiovascular disease. The 
first congressional appropriation to the NHLBI was less than $1 
million. Since then, the NHLBI's budget has grown to $1.51 billion 
thanks to the Subcommittee's long-standing support. Again this year, 
the ACC asks the Subcommittee to maintain that commitment.
    Our nation's citizens, many of them potential cardiac patients, do 
not want us to become complacent as we celebrate the successes of the 
past 50 years that have resulted from our nation's pioneering research 
and educational programs. The unsettling reality is the staggering 
number of deaths attributable annually to cardiovascular disease. Since 
1910, with the exception of the great influenza epidemic, heart disease 
has and continues to claim more lives each year than any other disease. 
This year alone, one million Americans will die as a result of 
cardiovascular disease.
    More than 50 million Americans, about one-fifth of the population, 
are living with some type of cardiovascular disease. Fortunately, most 
of them are living better and more productive lives as a result of new 
drug and device therapies, surgical innovations, enhanced emphasis on 
prevention, and innovative educational programs--all made possible 
through NHLBI-sponsored research. For example, last year an important 
discovery was made as a result of the Antiarrhythmics vs. Implantable 
Defibrillators Trial. This trial proved that implantable cardiac 
defibrillators improve overall survival in patients with serious 
ventricular arrhythmias. What researchers have learned throughout the 
20th century about cardiovascular disease has saved millions of lives 
and has improved the quality of tens of millions more.
    Regardless of these advances, however, heart disease continues to 
greatly affect the lives and productivity of too many people. 
Fortunately, the prospects for progress in the 21st century are vastly 
greater than scientists could have ever foreseen in 1948. Now more than 
ever it is critical that the Subcommittee renew its long-standing 
support for the NHLBI.
               medical research funding and cost savings
    In 1998, the total economic impact of heart disease in the United 
States is projected to reach $175.3 billion, of which about $98 will be 
directly attributable to the costs of providers, hospital and nursing 
home services, medications, and home health. The remaining $77 billion 
will come from lost productivity. Think of the impact that research had 
on tuberculosis and polio--major public health programs just a few 
decades ago. In this extraordinary era of molecular biology, NHLBI-
funded researchers are on the brink of making major discoveries that 
should yield significant benefit in the area of cardiovascular disease.
  --Nearly 14 million Americans alive today have a history of heart 
        attack, heart-related chest pain or both. Researchers may be 
        close to being able to predict through a simple blood test 
        whether some individuals, who are otherwise apparently healthy, 
        may be at risk of a first heart attack years before symptoms 
        appear. The results of this research could offer opportunity to 
        develop potential new avenues for prevention and treatment.
  --Congestive heart failure is projected in 1998 to cost nearly $19 
        billion in medical expenses and lost productivity and is the 
        leading cause of hospitalization for people age 65 and older. 
        New findings from the NHLBI's Systolic Hypertension in the 
        Elderly Program have revealed that treatment with a low-dose 
        diuretic antihypertensive drug reduces the risk of heart 
        failure by 50 percent in older persons with isolated high 
        systolic blood pressure, and by 80 percent among individuals 
        who have already suffered a heart attack. Heart failure is a 
        common and very serious problem that we must work hard to 
        prevent. Because there are more than 400,000 new cases of heart 
        failure annually in this country, the potential benefit from 
        this type of research could be enormous.
  --Heart deformities are the number one birth defect in the United 
        States, affecting 32,000 newborns each year and killing more 
        than 2,500 babies before age one. NHLBI scientists have created 
        two mouse models with a specific gene defect to replicate 
        malformations that occur in two common human congenital heart 
        diseases. Further research is under way to determine whether a 
        similar gene defect exists in humans and may eventually lead to 
        the development of gene-based diagnostic tests and therapies to 
        prevent malformations of the heart, save infant lives, and 
        reduce the need for corrective surgery after birth.
    Last year, members of Congress demonstrated their commitment to 
medical research by increasing funding to the National Institutes of 
Health (NIH) and the NHLBI for fiscal year 1998 and, also, through the 
introduction of several legislative proposals which would significantly 
increase over the next several years the financial resources dedicated 
to the NIH. The ACC applauds these efforts, especially in light of the 
constraints placed on the federal budget and the pressure of competing 
domestic spending priorities. To provide for a stable funding source 
beyond annually appropriated amounts, the ACC supports initiatives to 
establish a biomedical research trust fund.
    In his State of the Union address, the President announced that his 
fiscal year 1999 budget proposal will contain the largest funding 
increase for the NIH in the nation's history, providing $1.6 billion to 
the NHLBI for heart, lung and blood research. The College strongly 
supports the proposed $1.6 billion for the NHLBI.
                    genetics and molecular medicine
    Innovative research in human genetics and molecular biology holds 
great promise for the prevention and early diagnosis of cardiovascular 
disease. We are just beginning to realize the enormous potential of 
this fertile area of research. In the next century, it is possible that 
patients with hypertension will be distinguished by genotype, allowing 
preventive and therapeutic approaches to be tailored to meet the needs 
of specific subgroups. It has been discovered recently that people with 
certain genetic defects are more likely to develop hypertension and 
atherosclerosis if they are exposed to risk factors such as a high-salt 
or fatty diet.
    Furthermore, researchers with the NHLBI Framingham Heart Study have 
identified a genetic marker for hypertension which links a mutation in 
the gene for angiotens in converting enzyme which regulates blood 
pressure in men. Genetic research suggests that someday new treatments 
and ways to prevent or even reverse the progression of cardiovascular 
disease will be available. Early reports from NHLBI-funded researchers 
working on gene transfer techniques are very promising. Preliminary 
findings suggest that this innovative approach might slow the 
development of atherosclerosis in vascular grafts, such as those used 
in coronary artery bypass surgery. Other studies suggest that it may be 
possible to promote recovery of cardiac function after a myocardial 
infarction by introducing healthy heart cells into the weakened heart 
muscle.
                        education and prevention
    Over the last decade, much has been learned about the prevention of 
cardiovascular disease. We know that heart disease is linked 
definitively to hypertension, high cholesterol, diabetes, smoking, 
physical inactivity, and obesity. The NHLBI's public education 
programs--the National High Blood Pressure Education Program, the 
National Cholesterol Education Program, and the National Heart Attack 
Alert Program--make information readily available to patients, 
families, and health professionals.
    As physicians, educators, and public health officials, we 
acknowledge there is much to be done to ensure that the preventive 
measures that have proven to be effective are being used to fight 
cardiovascular disease. A renewed commitment, under the guidance of the 
NHLBI, is needed by physicians and patients to reduce the risk factors 
that are plaguing Americans. Just recently, the NHLBI's National High 
Blood Pressure Education Program released new physician guidelines for 
the prevention and treatment of high blood pressure. The NHLBI will 
also convene a special emphasis panel which will provide 
recommendations for dissemination research to improve treatment and 
prevention programs in clinical and community settings.
                          women and minorities
    In every year since 1984, cardiovascular disease has claimed the 
lives of more females than males. Exciting new research has found that 
estrogen deficiency may be linked to the higher prevalence of coronary 
heart disease in postmenopausal women. While estrogen replacement 
therapy has been recommended as a preventive measure against heart 
disease, the benefits are not conclusive and there are potential side 
effects. The NHLBI is pursuing research into the development of 
``designer estrogens'' that could protect against heart disease without 
undesired effects.
    Black men and women continue to suffer disproportionately from 
cardiovascular disease and many of its related causes, particularly 
hypertension. The NHLBI continues to emphasize the importance of 
including minorities in clinical research and trials. The NHLBI has 
also started a new program that targets Latinos living in the United 
States. The ``For the Health of Your Heart'' initiative is designed to 
increase the awareness of the heart disease risk factors and promote 
lifestyle changes to reduce the chances of developing heart disease.
                               nutrition
    The NHLBI continues to make considerable progress in understanding 
the role of nutrition in cardiovascular disease and has increased its 
involvement in this important area. The NHLBI Dietary Approaches to 
Stop Hypertension trial has shown that a diet low in fat and high in 
vegetables, fruits, and low-fat dairy foods has the similar effect of 
reducing high blood pressure as single-drug therapy. Through the 
Cardiovascular Health Promotion Project, the NHLBI is promoting the 
adoption of heart healthy behavior among children and their families 
through schools, community organizations, and recreation facilities.
                        other areas of research
    Other areas of important NHLBI research opportunities in need of 
support include the following:
  --Cell Transplantation.--Exciting new developments are occurring in 
        cardiac cell transplantation. The ability to increase the 
        number of functional cells in a diseased heart could ultimately 
        eliminate the need for mechanical support or heart 
        transplantation. Preliminary animal studies suggest that 
        engrafting cells into heart tissue can replace the damaged 
        tissue. Further research is needed on genetic, molecular, and 
        cellular approaches to transplanted cells into heart tissue.
  --Cell Loss and Heart Failure.--Little is known about the underlying 
        causes of heart muscle loss during end-stage heart failure. 
        Molecular, cellular, and genetic research is needed to learn 
        what role cell death has on the development of heart failure. 
        If scientists can better understand cell loss, perhaps new 
        interventions for the prevention and treatment of heart failure 
        can be developed.
  --Cholesterol in Embryonic Development.--The role of cholesterol in 
        embryonic development is just beginning to be understood. 
        Genetic cholesterol-deficiency syndromes have been identified, 
        and it is known that certain genetic characteristics lead to 
        multiple abnormalities, including cardiovascular defects. The 
        NHLBI is convening a special emphasis panel which will examine 
        the role of cholesterol in embryonic development, and the 
        potential effects of cholesterol lowering in pregnancy.
  --Viral Genes and Atherosclerosis.--Recent evidence suggests that 
        viral agents may play a role in the initiation and progression 
        of atherosclerosis, a condition in which the artery walls 
        become narrowed due to the build-up of fat, cholesterol and 
        other substances, thereby causing the reduction of blood flow. 
        Modern methods of genetic and molecular research offer 
        opportunities to explore the viral mechanisms of 
        atherosclerosis and other cardiovascular diseases which could 
        eventually lead to interventions that may prevent or lessen the 
        consequences of heart attacks and congestive heart failure.
                            closing remarks
    Beyond better public awareness, reducing the number of 
cardiovascular-related deaths is greatly dependent upon research 
sponsored by the NHLBI. The United States must prepare itself, both 
scientifically and fiscally, for the inevitable increase in the 
incidence of cardiovascular disease that will accompany the graying of 
the so-called baby-boomer generation. I hope the Subcommittee shares my 
optimism about the unique opportunities that our scientists and 
clinical investigators now have to achieve their long-standing goal of 
conquering this nation's number one killer. In summary, the American 
College of Cardiology would like to encourage the Subcommittee to 
generously fund the NHLBI. It is a wise investment in our nation's 
future.
                                 ______
                                 
   Prepared Statement of Rev. Gary Hutcheson, Volunteer Advocate, on 
              Behalf of the National Psoriasis Foundation
    Mr. Chairman and members of the Appropriations subcommittee: My 
name is Gary Hutcheson. I am speaking to you as a volunteer advocate 
both for myself and on behalf of the 6.5 million American men, women 
and children who are battling psoriasis--a chronic, debilitating skin 
disease. It is a disease without a cure, and without universally 
effective treatments. Until a cure or more effective treatments are 
found, millions of people with psoriasis face a lifetime fighting this 
ravaging disease.
    Over three billion dollars are spent annually on treatments for 
psoriasis and each year psoriasis patients make approximately 2.4 
million visits to dermatologists.
    In fact, psoriasis is chronic, unpredictable and often unrelenting, 
and treatments may be successful for only relatively short periods of 
time for only some people. The thick, red, scaly patches on any or all 
parts of the body, and painful joints, can limit daily activities and 
interfere with physical, occupational and psychological functions. Skin 
affected by psoriasis may itch, burn, sting, and easily bleed. 
Physically, psoriasis can range in severity from mild to disabling.
    The occupational impact of the disease poses a significant economic 
burden for the nation and a financial hardship for the person with 
psoriasis. Emotionally, psoriasis can be devastating. The social 
rejection and physical suffering of psoriasis has led people to 
suicide.
    Some types of psoriasis may require hospitalization and can even be 
life-threatening. Each year approximately 400 people with psoriasis are 
granted disability by the Social Security Administration because of 
debilitating disease. Perhaps even more difficult is the fact that 
three-quarters of a million people diagnosed with psoriasis are under 
the age of 10.
    Though I do not want to sensationalize my personal situation, I 
have had psoriasis for the last 20 years. I can relate something of the 
pain and discomfort, public humiliation and embarrassment, private 
disgust, gnawing doubt and shattered self-image, that the vast majority 
of psoriasis sufferers struggle with throughout their lives.
    Twice I have been hospitalized for extended periods of time to 
treat the disease. On numerous occasions I have received multiple 
injections directly into the psoriatic patches. As many as 30 
injections have been given in a single doctor's office visit.
    Moderate-to-severe psoriasis dramatically inhibits a person's 
ability to maintain a normal, healthy, active lifestyle because so much 
time must be devoted to the ongoing, daily treatment of the disease. 
Early in my ministerial career I was compelled to change my vocational 
direction from working with troubled teenagers to a pastoral ministry 
setting due to the rapid advance of my psoriasis. More than once, while 
playing volleyball or swimming with the young people entrusted to my 
care, I was innocently asked, ``Hey Pastor Hutch, do you have some kind 
of creeping, jungle rot?''
    The severity of my condition has progressed to the extent that I 
can no longer even participate in those kinds of simple, fun, anxiety-
relieving, stress-reducing activities.
    I have even relocated my family from one part of the country to 
another in an effort to find the most advantageous combination of 
climate, UV radiation from the sun, and specialized medical expertise, 
for treating this tenacious, debilitating malady.
    A task as simple as taking a bath has become a painful, time-
consuming ordeal. In fact, the derogatory comments, uneasy stares of 
strangers, and subtle but evident attitude of friends who ``keep their 
distance'', are not as traumatic as the countless hours spent: soaking 
in coal tar baths; applying numerous topical steroid creams and 
ointments; wearing occlusive plastic suits to bed; administering 
various medicated oil and liquid steroid treatments to the scalp; 
undergoing regularly scheduled liver biopsies; receiving weekly UVB or 
PUVA ultraviolet light radiation treatments; and having blood drawn on 
a monthly basis.
    These treatment regimens represent only a partial list of the 
continual maintenance regimen for many, many people afflicted with 
psoriasis. Also, the frustration and demoralization of this kind of 
schedule is greatly increased when one considers the limited efficacy 
of these treatments in controlling and relieving psoriatic symptoms. 
The vast majority of psoriasis patients are all too familiar with the 
devastating emotional ``roller coaster'' ride from the ``trial and 
failure'' scenario of current treatment options. And, I've not even 
mentioned the enormous financial burden created by the very expensive 
medications, doctor's fees, and treatments.
    I know that my experience is not unique. Through my affiliation 
with the National Psoriasis Foundation I have come to understand that 
my struggle with this disease has not been nearly as devastating as 
that of hundreds of thousands of other victims.
    Like diabetes, arthritis, and heart disease, psoriasis requires 
lifelong treatment. Unlike these diseases, however, psoriasis is not, 
or should I say was not, a top priority for many researchers. However, 
thanks to focus and funding provided by NIAMS, recent research has 
identified several possible sites for the genes that may cause this 
inherited condition.
    Excellent research conducted by NIH and NIAMS has shown that 
effective treatment and a cure for psoriasis is within reach. 
Sufficient funding will enable medical science to complete the puzzle 
and find a cure for this affliction. So many pieces are in place; we 
must not hesitate now.
    This will not only benefit the 6.5 million American children and 
adults now suffering with this chronic disease, but will also help the 
over 200,000 new cases of psoriasis diagnosed every year. Better 
treatments or a cure for psoriasis will result in savings both to the 
public and the government in treatment costs, lost work days, and 
Social Security disability claims.
    Therefore, on behalf of the 40,000 members of the National 
Psoriasis Foundation, and the 6.5 million Americans with psoriasis, I 
urge you to approve an increase of 15 percent over current funding 
levels for NIAMS for fiscal year 1999. This increase will have 
significant health and socioeconomic benefits for the millions of 
Americans who are affected by psoriasis and by other diseases under the 
purview of NIAMS. Thank you for your time and your support.
                                 ______
                                 
   Prepared Statement of Warren Greenberg, Ph.D., Professor, Health 
 Economics and Health Care Sciences, George Washington University, on 
                     Behalf of Mended Hearts, Inc.
    My name is Warren Greenberg. I am a professor of health economics 
and of health care sciences at The George Washington University. I am 
married and have a 23-year-old daughter.
    I advocate an increased appropriation for the National Heart, Lung, 
and Blood Institute. I am a victim of heart disease and as a 
beneficiary of the efforts of medical researchers to overcome this 
disease. I might also add that I am a member of Mended Hearts, Inc., a 
support group of 24,000 members throughout the United States. I have 
been appointed lobbying and legislation chairperson of that group--a 
volunteer position.
    I am 54 years old. I was born with aortic stenosis, a narrowing of 
the heart valve. Throughout my entire life I have lived with heart 
disease, often incredibly severe.
    When I was in my early teens, my physicians did not allow me to 
play high-school inter-mural sports, although I was a fine young 
athlete. At the age of eighteen I was told not to play ball under any 
circumstances. In my early 20s I was told to climb no more than two 
flights of stairs. By my early and mid-thirties I began to climb steps 
more and more slowly, often pausing to rest. I never carried an attache 
case home from work. It was too heavy. I would often balance a large 
book on my hips, rather than carrying it outright, in order to blunt 
the weight. I would walk two or three blocks on a level street to avoid 
going up three or four steps at the end of particular blocks. I could 
barely lift my newborn child; I could not help my wife take in the 
grocery bags.
    On May 7, 1982, at the age of 39, I had open-heart surgery at the 
Cleveland Clinic to replace my diseased valve with the valve of a pig. 
After my 6-week recuperative period I was amazed to find that not only 
was I able to walk, but was also able to play tennis, to jog, and to 
exercise. I was able to live a normal life.
    By August 1988, however, my new valve had failed. On August 31, I 
again had cardiac surgery at the Cleveland Clinic to replace the failed 
pig valve with an artificial plastic valve, known as the St. Jude's 
valve. I am again able to live a relatively normal, very productive 
life. And I am deeply thankful for it.
    I still take a blood-thinning medicine, coumadin, which helps 
prevent clots on my new valve. At the same time, because of the 
medicine, I must be cognizant and careful of excessive bleeding. In 
1983 I contracted bacterial endocarditis, an infection of the heart 
valve, from dental surgery which kept me in the hospital for six weeks. 
Whenever, I have dental work, I now get intravenous penicillin to 
protect me against such infections. I realize that my valve, as a 
mechanical device, may fail at any time in the future.
    For nearly 16 years, thanks to the fruits of medical research, I 
have been able to travel abroad at least once a year, to jog in the 
park, to be a productive author of many scholarly articles and a number 
of books on the health care economy. I have been quoted often on my 
views of the U.S. health care system and have made many television 
appearances. If it were not for the advances in research leading to 
improved techniques in open-heart surgery, I would not have seen my 
fortieth birthday. I would not be able to look forward to a life of 
many rewards and enjoyments.
    As an economist. I observe continually the link between monetary 
resources and the development of innovation and technology. Health care 
research, and cardiovascular research in particular, is no exception. I 
also understand as an economist that there are always competing uses 
for appropriated monies. However, cardiovascular diseases last year 
killed more than 960,000 Americans, about 154,000 of whom are under age 
65.
    Despite advances in medical research, these diseases remain the 
number one killer in the United States and a leading cause of 
disability. From my personal perspective and for those in Mended Hearts 
Inc., and others in the United States who have heart disease or will 
get it in their lifetime, consistent with congressional resolutions for 
the NIH, I ask for a doubling of NHLBI budget in five years. To reach 
this funding goal, I advocate a fiscal year 1999 appropriation of 
$1.825 billion for the NHLBI to help reduce further the incidence and 
degree of heart disease.
                                 ______
                                 
    Prepared Statement of Alan G. Kraut, Ph.D., Executive Director, 
                     American Psychological Society
    Mr. Chairman, Members of the Committee: Thank you for allowing me 
to testify on fiscal year 1999 appropriations for the National 
Institutes of Health (NIH). I am Alan Kraut, Executive Director of the 
American Psychological Society (APS), the national organization devoted 
to the science of psychology. APS members include the most 
distinguished academic researchers and leaders in scientific 
psychology. Many receive NIH funding for research in such areas as 
brain and behavior, addiction, human development, aging, mental 
illness, violence, hearing, vision, and chronic pain, to name just a 
few relevant topics in our field.
    On behalf of the 16,000 members of APS, let me begin by expressing 
sincere gratitude for your support of health research--for the 
substantial increase you appropriated to NIH for the last few years, 
and also for your consistent and visible messages about the importance 
of research in public health. We applaud your efforts to devote 
additional resources to this essential public health enterprise. We 
look forward to working with you to double the NIH budget over 5 years. 
APS is part of the Ad Hoc Group for Medical Research Funding and we 
join the Ad Hoc Group in urging a 15-percent increase for NIH in fiscal 
year 1999 as a first step toward that goal.
    But can NIH absorb this increase in so short a time? I can assure 
you that behavioral science research can. We are poised, both in terms 
of the role of behavior in causing serious health problems and in terms 
of the field's capacity, to proceed in a number of critical directions. 
As the Committee already knows, critical health concerns are reflected 
in such questions as: What goes on in the thinking of young people that 
leads them to start smoking, drinking, or taking drugs? What are the 
behavioral underpinnings of craving? When in our development do we 
acquire the behavioral patterns that may be with us for a lifetime? 
What are the connections between stress and health? What are the root 
causes of violence? What can we do to help memory as we age? And there 
are many others. But NIH's neglect of these kinds of questions 
continues despite a significant body of specific recommendations from 
Congress, from independent scientific agencies such as the National 
Academy of Sciences (NAS), and even from its own Institutes concerning 
new ways to develop behavioral approaches to health.
                                training
    National Research Service Awards.--The clearest evidence of NIH's 
resistance to behavioral research is seen in the lack of response to 
Congressional and NAS recommendations on training young investigators 
in behavioral science. In a 1994 Congressionally-mandated report on the 
Nation's personnel needs in biomedical and behavioral sciences, NAS 
called for an increase in the size of stipends awarded under the 
National Research Service Awards (NRSAs) and for an increase in the 
number of behavioral science investigators, health services researchers 
and investigators in other areas, while holding the number of 
biomedical NRSA awards at the current level. The NAS set forth a 
specific number of NRSA awards needed in behavioral science and offered 
a compelling rationale for the increase. In 1995, this Committee began 
what turned into an annual ritual in which the Committee (and the 
Senate Committee as well) requested NIH to develop a plan and timetable 
for implementing the recommendations. NIH ignored both the NAS and 
Congress until a few months ago. In response to the fiscal year 1997 
request from this Committee, NIH issued its response that the NAS 
recommendations will be selectively implemented. Specifically, NIH will 
increase the NRSA stipends, but not the number of awards in behavioral 
science or other areas.
    It is ironic that even with the recent increases in NIH's annual 
budget and all the talk of doubling the NIH budget, NIH is citing 
budget concerns as the rationale for this selective implementation. 
They suggest that presumably neither the NAS nor this Committee ``fully 
appreciated the costs'' of increasing the number of behavioral 
trainees. And what is the cost? The behavioral science recommendation--
to add less than 400 trainees--would add about $4 million over 3 years 
across all of NIH. Clearly, cost is not the concern here.
    To build a stronger behavioral science research infrastructure that 
will improve NIH's ability to respond to the Nation's most urgent 
health problems, we ask the Committee to direct NIH to increase the 
number of National Research Service Awards for behavioral science 
investigators, as recommended by the National Academy of Sciences.
    B/START.--Several Institutes on their own have recognized the need 
for more behavioral researchers. With encouragement from this Committee 
and from the Senate, they have developed Behavioral Science Track 
Awards for Rapid Transition (B/START), which are small grants to new 
Ph.D.'s in psychology or behavioral science. These are aimed at a 
critical juncture in a scientist's career--a time when choices are made 
about what research to pursue, a time of intense competition for entry-
level academic research positions, and a time to develop pilot data 
before submitting a regular (R01) grant proposal. It is also a time 
when many excellent scientists drop out because of a lack of support. 
These issues are addressed by B/START, which began at the National 
Institute of Mental Health and has spread to the National Institutes on 
Drug Abuse and on Aging. We commend NIMH, NIDA, and NIA for undertaking 
this approach to training behavioral investigators, and we ask this 
Committee to encourage the use of B/START mechanisms throughout NIH.
    Office of Behavioral and Social Sciences Research (OBSSR).--Like 
clinical research, behavioral science should be supported in virtually 
every NIH Institute, Center and Division. We see the Office of 
Behavioral and Social Sciences Research, created by Congress in the 
office of the NIH Director, as taking the lead on the training 
objectives described above, and on ensuring that behavioral priorities 
are pursued aggressively throughout NIH--there is a great deal of 
catching up to do. In its short existence under Director Norman 
Anderson, OBSSR has been an effective coordinating body on a number of 
cross-NIH initiatives and has increased the visibility of behavioral 
science at NIH. But OBSSR's budget is only $2.67 million, a minute 
amount compared to the budgets of parallel units within the NIH 
Director's office. Additional funding would give OBSSR the capacity to 
develop training initiatives, requests for applications in the most 
promising areas of behavioral science, and more effective responses to 
Congressional directives, recommendations from NAS and from individual 
Institutes, and advice from the field concerning future directions for 
research and training. We are in an era of exceptional promise in 
behavioral science, but we need a more encouraging federal environment 
to realize this potential. Increasing the budget of the OBSSR would be 
a significant step in creating that environment. We recommend an 
increase in the OBSSR budget to $20 million in fiscal year 1999.
    In the rest of my testimony, I want to concentrate on examples of 
what is currently being done and what more could be done in behavioral 
science research at several individual Institutes.
    National Institute of Mental Health (NIMH).--NIMH is the leading 
supporter of behavioral science research at NIH. Last year, I told you 
about the Institute's reorganization which increased the visibility of 
behavior in its structure. In addition, NIMH Director Steven Hyman 
pledged to strengthen connections between basic behavioral research and 
clinical applications, and in connections between the brain and 
behavior. But even our friends at NIMH resist some behavioral science 
priorities. For example, NIMH has yet to implement ``Basic Behavioral 
Science Research for Mental Health,'' a 1994 plan by its own advisory 
council in the same mold as NIMH's plans for schizophrenia and 
neuroscience. This Committee circulated the NIMH report to Congress and 
has for several years urged NIMH to increase its emphasis on basic 
behavioral research by implementing the national plan. NIMH has not 
responded. Similarly, this Committee has expressed support over several 
years for the 1996 NIMH report ``Reducing Mental Disorders: A 
Behavioral Science Research Plan for Psychopathology'' which was 
compiled by outside experts with NIMH support. Again, the Institute has 
not responded. These plans document the contributions of behavioral 
research in mental health and mental illness, and they identify 
promising behavioral research opportunities. The plans on basic 
behavioral research and on psychopathology are resources that should be 
the basis for requests for applications, program announcements, 
training priorities, and other NIMH initiatives. We ask this Committee 
to encourage NIMH to report on how these two plans will lead to 
research and training in behavioral research related to mental health 
and illness.
    National Institute on Drug Abuse (NIDA).--NIDA is a model of how we 
hope every National Institute would approach its behavioral science and 
public health responsibilities. Under psychologist Alan Leshner, NIDA 
has been strengthening its behavioral science portfolio in important 
directions, bringing to bear new perspectives on treating and 
preventing drug abuse and addiction. Drug addiction is a brain disease, 
but it doesn't start out that way. Why do young people initiate drug 
use? This question requires understanding the basic mechanisms of peer 
pressure, of how attitudes develop, and of the processes involved in 
cognition. Why do some go on to addiction, while others stop? This 
question requires identifying risk and protective factors in 
individuals, families, and communities. What is the effect of drugs on 
learning and behavior? This question involves connections between the 
brain and behavior, between thinking and acting.
    Another question is: How do we treat addiction? NIDA's efforts in 
behavioral science are paying off here. We've known for some time that 
behavioral interventions are central to the treatment of addiction. 
They are the only available treatments for many drugs. Even where 
medications are available to treat addiction, the most effective 
courses of treatment have included behavioral interventions. Now, a 
NIDA-sponsored study shows that for cocaine, the effectiveness of newly 
developed medication is contingent on having a behavioral intervention 
first. In other words, medication doesn't work unless the person first 
has behavioral therapy.
    Given the central role of behavior in drug abuse and addiction, and 
given NIDA's aggressive pursuit of behavioral research, we strongly 
urge the Committee to do everything possible to ensure that NIDA 
receives the largest possible increase for fiscal year 1999.
    National Institute on Alcohol Abuse and Alcoholism (NIAAA).--
Similar gains are being made in behavioral research at NIAAA, where 
Director Enoch Gordis is expanding behavioral science. There are new 
initiatives in the social psychology of group identification; 
behavioral genetics to understand the biological and environmental 
factors in vulnerability to alcoholism; the psychophysiology of 
alcoholism; and basic behavioral research on craving and on the effects 
of alcohol abuse on memory and cognition. NIAAA also is moving forward 
on more applied research. The Institute published an impressive plan 
for its health services research, and is about to launch an initiative 
aimed at reducing drinking at college. We ask the Committee to support 
to NIAAA's aggressive pursuit of new behavioral science research and to 
ensure that NIAAA receives the largest possible increase for fiscal 
year 1999.
    NIH Grant Review Reorganization.--When NIMH, NIDA, and NIAAA were 
transferred to NIH by Congress, their peer review systems remained 
separate from NIH. The integration of those systems which is now 
underway has triggered a reorganization of the entire NIH peer review 
system. Here is an opportunity for NIH to strengthen its behavioral 
science infrastructure. Adding these three Institutes means there will 
be considerably more behavioral science research being reviewed in the 
NIH system. NIH must take deliberate and appropriate steps to ensure 
that the new system is equipped to handle these grants. These steps 
include having the appropriate balance of expertise on review 
committees--putting the peer in peer review--and establishing a 
scientifically appropriate referral process. Because of the enormous 
budgetary and public health implications of NIH grant review, we ask 
the Committee to monitor this peer review reorganization and request 
from NIH a report on its plans for ensuring the appropriate review of 
behavioral research grants.
    National Institute on Aging.--NIA supports much research on 
behavioral and social factors in aging. I want to focus on one area: 
cognitive psychology. With links ranging from neuroscience to social 
and developmental science, there may be no more exciting and productive 
area of aging research. Anyone over 40 has experienced normal memory 
glitches. ``Where did I put those car keys?'' ``What is that person's 
name?'' But when we start forgetting what the car keys are for, or 
can't recognize a loved one, those are signs of serious problems, 
possibly Alzheimer's or some other dementia. Early identification and 
treatment of these problems is likely to come from cognitive science, 
which is allowing us to look at the aging mind and better understand 
the effects of growing older on the ability to process information and 
to make decisions. NIA is exploring ways to expand its support of this 
promising frontier in research on aging and behavior. We ask the 
Committee to support NIA in its pursuit of new directions in cognitive 
psychology.
    National Institute of Child Health and Human Development.--Together 
with the community, NICHD has begun an effort to identify areas of 
behavioral research and training that are ripe for major breakthroughs 
as well as areas of research that require further nurturing. This 
effort included a conference entitled ``Progress and Promise in the 
Behavioral Sciences,'' at which the leaders in the field recommended 
specific actions, among them: Increase pre- and post-doctoral research 
training and mentoring; support cross-disciplinary training mechanisms; 
support basic behavioral research on development to generate 
methodological and conceptual advances in research; and give priority 
to understanding the effects of poverty, different family structures, 
and technology on child physical and intellectual development.
    NICHD has just reorganized its behavioral research programs into a 
new Child Development and Behavior Branch, headed by developmental 
neuropsychologist Reid Lyon. This Branch is well suited to respond to 
these recommendations. We are urging NICHD to aggressively pursue the 
recommendations of the ``Progress and Promise'' conference, and ask the 
Committee to request that NICHD develop a plan and a timetable for 
doing so.
    National Institute of Nursing Research.--NINR has been designated 
the lead Institute in a new NIH initiative that addresses end-of-life 
issues. This is one of the least researched phases of life. The NINR 
initiative includes improved treatment for pain, but also addresses 
diagnosis and treatment of behavioral symptoms such as cognitive 
problems, delirium, and depression. With its research in symptom 
management, decision making for patients, caregiving, and optimal 
environments for critically-ill patients, NINR brings impressive 
experience to the lead role in end-of-life research. We ask that this 
Committee support NINR in this initiative.
    In the interest of brevity, I am able to describe only a few of the 
contributions and importance of behavioral research in addressing the 
Nation's health concerns. Other Institutes with behavioral science 
portfolios include the National Heart, Lung, and Blood Institute, which 
supports investigations into the links between stress and heart 
disease; the National Institute of Neurological Disorders and Stroke, 
which supports research on brain and behavior; the National Cancer 
Institute, which has just formed a new prevention branch that should 
support increased of behavioral research; and the National Institute on 
Deafness and Communication Disorders, which supports psychologists' 
research in auditory perception and language development.
    Despite all this activity, NIH still needs to recognize behavioral 
science as a core element in its dual missions in health research and 
public health. Priorities in research and training have been identified 
in numerous behavioral science areas but are not being pursued. This 
Committee has shown extraordinary largess in increasing the annual NIH 
budget and we are grateful for that support. Now, we ask you to ensure 
that the health of the Nation receives the full benefit of behavioral 
science research by encouraging NIH's leadership to take meaningful 
steps, such as those I have outlined above, to reverse the underfunding 
of behavioral science research.
                                 ______
                                 
  Prepared Statement of Martha Hill, R.N., Ph.D., President, American 
                           Heart Association
You are a target
    Chances are heart attack or stroke will be the death or disabler of 
you or someone you love. You are not alone. Heart attack, stroke and 
other cardiovascular diseases are America's No. 1 cause of death and a 
main cause of disability. Cardiovascular diseases account for nearly 1 
of every 2 deaths in the U.S. The American Heart Association is 
dedicated to reducing death and disability from heart attack, stroke 
and other cardiovascular diseases. We commend this Committee's support 
of the National Institutes of Health and the Centers for Disease 
Control and Prevention. But, we are concerned that our government is 
not devoting sufficient resources for research and prevention of 
America's No. 1 cause of death--heart disease--and to our country's No. 
3 cause of death and most disabling disease--stroke.
How you can make a difference
    Now is the time to capitalize on progress in understanding heart 
attack, stroke and other cardiovascular diseases. Promising cost 
effective breakthroughs in research and prevention are on the horizon. 
The AHA challenges our government to significantly increase funds for 
heart and stroke research and to translate research into effective 
clinical and community interventions. These actions will help reduce 
health care costs and improve quality of life. For fiscal year 1999 we 
urge you to do the following: Appropriate a 15 percent increase over 
current funding for the overall NIH, the first increment toward the 
goal of doubling the budget in five years. This goal is echoed by 
Research!America and the Ad Hoc Group for Medical Research Funding.
    NIH research provides cutting-edge treatment and prevention 
strategies, cuts health care costs, creates jobs and maintains 
America's status as the world leader in biotechnology and 
pharmaceutical industries. Provide a 15-percent increase over fiscal 
year 1998 funding specifically for NIH heart research and stroke 
research.
    Heart and stroke researchers are on the brink of advances that 
could pave the way to prevention and even a cure so you or someone you 
love will be spared pain and suffering from heart disease and stroke. 
Allocate $21 million for the CDC Cardiovascular Health Program.
    We must make our science real and applicable through community 
interventions that encourage Americans to make heart healthy lifestyle 
choices.
Still No. 1
    Heart attack, stroke and other cardiovascular diseases have been 
the leading cause of death since 1919. Some 58 million Americans--1 in 
5--of all ages suffer from one or more of these diseases. Millions of 
Americans have risk factors for these diseases--about 50 million have 
high blood pressure, 38 million have high blood cholesterol and 50 
million smoke. As the baby boomers age, the number of Americans 
afflicted by these disabling diseases will increase substantially. 
Cardiovascular diseases put an enormous burden on our economy. 
Americans will pay an estimated $274 billion for cardiovascular-related 
medical costs and lost productivity in 1998. These diseases constitute 
4 of the top 5 hospital costs for all payers, excluding childbirth and 
its complications, and 4 of the top 5 Medicare hospital costs.
Heart and stroke research benefits all Americans
    Thanks to advances in addressing risk factors and in treating 
cardiovascular diseases, more Americans are surviving heart attack and 
stroke. Heart and stroke research and prevention breakthroughs are 
saving and improving lives of your friends and those you love every 
day. You and your family have benefited directly from heart and stroke 
research. Several cutting-edge examples follow.
  --Emergency Cardiac Care.--Every day more than 1,000 Americans suffer 
        a sudden cardiac arrest, the unexpected, abrupt loss of heart 
        function. Researchers have discovered a particular sequence of 
        actions known as the ``chain of survival,'' which offers hope 
        for these individuals. Early use of both breathing and chest 
        compression techniques of cardiopulmonary resuscitation (CPR) 
        and delivery of a powerful electrical shock to the heart are 
        critical to restore life. Each minute of delay in returning the 
        heart to its normal pattern decreases chance of survival by 10 
        percent. An estimated 100,000 lives could be saved each year if 
        automatic external defibrillators (AEDs) were widely available.
  --New Surgical Heart Techniques.--Medical research has revolutionized 
        surgical techniques in the cardiovascular field. You probably 
        know someone who has benefited from the research breakthroughs 
        called heart bypass surgery and Percutaneous transluminal 
        coronary angioplasty (PTCA). Patients who undergo conventional 
        bypass surgery to improve blood flow to the heart require 
        several weeks to recover. But, those who experience the new 
        ``keyhole'' or ``minimally invasive heart bypass surgery'' need 
        only several recovery days. Surgeons operate via a three-inch 
        incision. Keyhole surgery can provide an alternative for the 
        growing number of Americans who endure the traditional surgery 
        to eliminate chest pain, increase ability to exercise and 
        reduce fatigue and need for medicine. In 1995, an estimated 
        768,000 patients benefited from bypass surgery and PTCA to 
        improve blood supply to the heart.
  --Surgery to Reduce Risk for Stroke.--When the main artery to the 
        brain becomes blocked, in many cases surgeons now can remove 
        the buildup of plaque to prevent stroke. This procedure 
        benefits not only stroke survivors, but also helps patients who 
        experience stroke symptoms or even those who have no symptoms 
        but a partially blocked artery.
  --State-of-the Art Life-extending drugs.--Research has produced 
        amazing new drugs to help prevent and treat heart attack and 
        stroke. Cutting-edge drugs to control blood pressure and 
        cholesterol are more effective than ever in saving lives and 
        enhancing life quality of millions of Americans. When 
        prevention fails, revolutionary ``clotbuster'' drugs can reduce 
        disability from heart attack and stroke by dissolving blood 
        clots causing the attack. Now, use of t-PA within three hours 
        of the onset of a stroke can stop progression of clot-caused 
        stroke and reduce chances of permanent disability by 30 
        percent. T-PA offers hope for an estimated 1.1 million 
        Americans who are expected to suffer a heart attack and 450,000 
        at risk of a clot-caused stroke in 1998.
    So Americans can continue to benefit from these types of 
breakthroughs, we support doubling of the NIH budget in five years. We 
recommend an fiscal year 1999 appropriation of $15.7 billion for the 
NIH as the first step toward that goal. AHA has a special interest in 
individual NIH institutes that relate directly to our mission. Our 
funding recommendations for these institutes and programs follow.
Heart research challenges and opportunities for NHLBI
    These and other advances have been made possible by 50 years of 
AHA-sponsored research and a half-century of investment by Congress in 
the National Heart, Lung, and Blood Institute. Thanks to research, no 
longer does a heart attack or stroke necessarily mean immediate death. 
Now that more people are surviving, heart attack and stroke can mean 
permanent disability, requiring costly medical care, loss of 
productivity and quality of life.
    The AHA urges this Committee to double the NHLBI budget in five-
years. To reach this goal, we recommend an fiscal year 1999 
appropriation of $1.825 billion for the NHLBI. A funding level of this 
amount will allow NHLBI to expand existing programs and invest in 
promising initiatives. Several challenges and research opportunities to 
advance the battle against heart disease are highlighted below.
  --Origins of atherosclerosis.--Heart attacks and nearly half of all 
        strokes are the end result of atherosclerosis, the disease 
        process that causes obstructed blood vessels. About 14 million 
        Americans live with consequences or symptoms of coronary heart 
        disease, the cause of heart attacks. An estimated 1.1 million 
        Americans will suffer a heart attack and about 600,000 will 
        suffer a stroke this year. Survivors often suffer permanent 
        heart or brain damage and are unable to return to work or to 
        their regular lifestyle. If origins of the blockages were 
        understood, many heart attacks and strokes may be prevented. 
        Now, researchers are examining new theories about 
        atherosclerosis. They include a long-lasting, low-grade 
        inflammation in blood vessels that feed the heart and brain; a 
        common respiratory viral infection that has been found in the 
        blood vessel walls, and defective genes inherited from parents. 
        More funds are needed now; because these studies may 
        revolutionize the way we prevent or treat heart attack and 
        stroke.
  --Congestive heart failure.--About 5 million Americans suffer from 
        congestive heart failure, the single most frequent cause of 
        hospitalization for those age 65 and older. During the past 17 
        years, total hospitalizations for congestive heart failure more 
        than doubled. For many, relatively simple tasks like making the 
        bed or preparing breakfast can be so fatiguing that the rest of 
        the day has to be spent in bed. A heart transplant is the only 
        way to curtail suffering or postpone death for some patients. 
        More research is essential to understand how and why the 
        disease occurs and how it can be treated and prevented. 
        Promising areas need more study. These include surgical 
        techniques to remove non-functioning heart muscle; left 
        ventricle assist devices; use of animal hearts for transplant; 
        transplant of healthy heart cells, and the role of programmed 
        cell death in the development of congestive heart failure. 
        Increased funds could lead to new methods for treatment and 
        prevention.
  --Heart disease in infants and youth.--Heart defects are America's 
        most common birth defect and a key cause of childhood 
        disability. Heart defects strike 32,000 newborns each year in 
        the United States. About 2,300 of these infants do not live to 
        celebrate their first birthday. Approximately 1 million 
        Americans live with the effects of these conditions. Scientists 
        often do not know why these defects occur. Children may also 
        develop an acquired heart illness in infancy or childhood. 
        Specialized Centers of Research (SCOR) in Pediatric 
        Cardiovascular Disease have made tremendous strides in rapidly 
        translating basic science and clinical research findings into 
        medical care for these infants and children. Resources to renew 
        these SCORs will allow more progress to determine underlying 
        mechanisms and will lead to better diagnosis, treatment and 
        prevention of heart disease that can severely restrict quality 
        of life of too many newborns, children and grandchildren.
  --A Healthful lifestyle.--Most Americans know smoking, physical 
        inactivity and being overweight are unhealthful. Why then are 
        people adopting unhealthful habits? Studies show that more 
        teenagers than ever are smoking cigarettes. Obesity is 
        increasing at an alarming rate among adults, teenagers and 
        children. Obesity is a risk factor for associated disorders, 
        including heart disease and stroke. Fatal heart attack, high 
        blood pressure and diabetes often accompany obesity. Resources 
        are urgently needed to determine the causes and develop 
        effective treatments for obesity. Research is needed to develop 
        effective educational and behavioral interventions and public 
        health approaches that help people change their behavior and to 
        maintain those healthful behaviors over time. More funds to 
        study the application of current research will yield 
        recommendations benefiting all Americans.
Stroke research challenges and opportunities for NINDS
    Stroke is America's major cause of permanent disability and No. 3 
cause of death. There are an estimated 4 million stroke survivors in 
the United States. They often face debilitating physical and mental 
impairment, emotional distress and overwhelming medical costs. About 20 
percent required help walking and 71 percent had impaired capacity to 
work when examined an average of seven years later, according to the 
NHLBI-sponsored Framingham Heart Study. In 1998 an estimated 600,000 
Americans will suffer a stroke. While stroke is considered to be a 
disease that strikes our grandparents, it also afflicts newborns, 
children and young adults. More Americans are dying from stroke than 
ever before.
    We urge a doubling of the National Institute of Neurological 
Disorders and Stroke--stroke budget in five years. An fiscal year 1999 
appropriation of $94.1 million for NINDS--stroke research, the first 
step toward the goal, will allow more rapid progress in preventing 
stroke, protecting the brain during stroke and enhancing 
rehabilitation. Some challenges and opportunities follow.
  --Brain imaging.--Imaging plays a critical role in evaluating stroke 
        patients, providing non-invasive diagnosis, treatment 
        assessment and prediction of recovery. A wide range of imaging 
        technologies are now available, each providing distinct 
        information about the brain. New research is required to 
        combine knowledge from diverse imaging techniques to enhance 
        data on brain activity. Extra funds are needed to develop 
        imaging to quickly diagnose some 450,000 patients a year who 
        may benefit from t-PA. Refined imaging technology has broad 
        application for other brain disorders.
  --Genetics of Stroke.--Stroke often has a genetic element. Recent 
        research has identified a gene linked to stroke caused by a 
        blockage. Other new studies have identified genetic risk 
        factors associated with stroke. More funds to study genetics 
        could lead to new methods to approach stroke.
  --Stroke Clinical Trials.--Basic research has progressed to the point 
        where clinical studies are crucial in advancing the prevention 
        and treatment of stroke. One fascinating trial is examining 
        whether estrogen therapy reduces the risk of death or recurrent 
        stroke in post-menopausal women. This study is particularly 
        important because more than 60 percent of fatal stroke victims 
        are women. Increased funds for clinical trials could produce 
        cutting-edge stroke treatment and prevention.
  --New Stroke Drugs.--Increasingly, promising new medications to treat 
        stroke will become ready for evaluation in patients. They 
        include drugs to restore blood flow to the brain, protect cells 
        from dying when stroke is in progress and prevent injury when 
        blood flow is restored. Additional resources are critically 
        needed to test the ideal combinations of these drugs in the 
        treatment of stroke.
  --Public and Professional Education for Stroke Treatment.--T-PA is 
        the first effective emergency treatment for clot-caused stroke. 
        The AHA and eight other national organizations are working with 
        NINDS to increase public awareness of stroke symptoms and the 
        appropriate urgent action to take. They also are striving to 
        develop systems to make t-PA readily available to appropriate 
        patients. When these systems are fully implemented, stroke 
        treatment will change from supportive care to early brain-
        saving intervention. More funds are urgently needed to address 
        challenges in educating the public about stroke symptoms and 
        the need for prompt treatment and assuring appropriate response 
        systems are in place in communities. Health care professionals 
        also must be educated about the new treatment and the need for 
        rapid response.
Research in other NIH Institutes and centers benefits heart and stroke
    National Institute on Aging research defines how the aging process 
contributes to cardiovascular diseases, a main cause of disability and 
No. 1 cause of death of older Americans. An fiscal year 1999 
appropriation of $38.2 million for NIA cardiovascular research will 
allow continuation of on-going studies and expansion into innovative 
promising areas.
    National Institute of Diabetes and Digestive and Kidney Diseases 
studies assist in reducing cardiovascular diseases death and 
disability. We advocate an fiscal year 1999 appropriation of $1 billion 
for NIDDK to advance research to help diabetics, 80 percent of whom 
will die from heart disease or stroke.
    National Institute of Nursing Research studies plays a key role in 
promoting self-care and patient education. NINR research is critical to 
primary and secondary prevention of heart attack, stroke and other 
cardiovascular diseases. We advocate an fiscal year 1999 appropriation 
of $73.1 million for NINR.
    Animal research is critical for heart and stroke research. AHA 
supports an fiscal year 1999 appropriation of $522 million for the 
National Center for Research Resources to help institutions and 
researchers obtain animals and provide humane care for them. Increased 
resources will fortify animal research, help correct deficiencies in 
research animal resources and strengthen nationwide Clinical Research 
Area Centers and Biomedical Technology and Infrastructure Areas.
Agency for health care policy and research
    AHCPR plays an important role through establishment of practice 
guidelines and conduct of outcomes research. Practice guidelines and 
outcomes research help insure that high quality and cost effective 
medical services are provided. AHCPR guidelines on rehabilitation after 
stroke have received considerable attention from practitioners. The AHA 
concurs with the Friends of AHCPR's recommendation of an fiscal year 
1999 appropriation of $175 million.
Centers for Disease Control and Prevention
    The best way to protect the health of Americans and lessen the 
enormous financial burden of disease is through prevention. Your 
commitment as elected representatives of the public cannot stop at the 
laboratory door. You must fund the work that brings research into the 
places where heart disease and stroke live--the towns and neighborhoods 
that populate America.
    The CDC builds the bridge between what we learn in the lab and how 
we live in our communities. CDC sets the pace on prevention. We 
recommend an fiscal year 1999 appropriation of $2.8 billion for CDC.
    As a result of the efforts of this Committee, CDC's Cardiovascular 
Health Program will begin this year with as many as five states 
receiving funds to implement state-based cardiovascular disease 
prevention and control programs. In 1997 CDC released a report 
outlining what the nation's priorities should be in the area of chronic 
disease prevention. The report titled, ``Unrealized Prevention 
Opportunities: Reducing the Health and Economic Burden of Chronic 
Disease'' said ``strong chronic disease prevention programs should be 
in place in every state to target the leading causes of death and 
disability in our society and their principal risk factors.'' Until the 
fiscal year 1998 appropriations for initiating a comprehensive 
Cardiovascular Health Program, the CDC-administered Preventive Health 
and Health Services Block Grant was the only source of federal funding 
to states for targeting the leading cause of death in every state in 
the nation.
    The AHA is delighted by the steps taken to create the 
Cardiovascular Health Program. We encourage the Committee to continue 
reaching out to states on heart disease and stroke prevention through 
an fiscal year 1999 appropriation of $21 million for the Cardiovascular 
Health Program.
    The Preventive Health and Health Services Block Grant has been a 
vital resource for states in their efforts to address heart disease and 
stroke. The Block Grant is vital in helping states with their role in 
preventing chronic disease. The AHA strongly recommends an fiscal year 
1999 appropriation of $255 million for the PHHSBG for fiscal year 1999. 
The AHA also urges the Committee to consider the importance of 
addressing, as the ``Unrealized Prevention Opportunities'' document 
points out, the need to target risk factors. We support CDC's effort to 
build the following:
  --A comprehensive nutrition and physical activity program with an 
        fiscal year 1999 appropriation of $15 million;
  --A national program to prevent tobacco use, including a national 
        public education campaign to reduce youth access to tobacco 
        products, through the CDC' s Office of Smoking and Health with 
        an fiscal year 1999 appropriation of $150 million; and
  --A comprehensive school health education program with an fiscal year 
        1999 appropriation of $25 million.
    Coupled with a comprehensive Cardiovascular Health Program, these 
intervention efforts will significantly advance the fight against heart 
disease and stroke. We urge the Committee to make cardiovascular health 
a national priority through these initiatives.
Action needed
    Significantly increasing resources for both research and community 
intervention programs will allow this nation to make great strides in 
the battle against heart attack, stroke and other cardiovascular 
diseases. Our government's response to this challenge will help define 
the health and well-being of our citizens--including those you love--
into the next century.
                                 ______
                                 
 Prepared Statement of Patrice O'Toole, Assistant Director, Federation 
          of Behavioral, Psychological and Cognitive Sciences
    Mr. Chairman, members of the Subcommittee, the Federation of 
Behavioral, Psychological and Cognitive Sciences is a coalition of 17 
scientific societies and 150 university graduate departments. The 
90,000 scientists represented by the Federation conduct behavioral 
research. Support for their work comes, among other sources, from the 
Office of Educational Research and Improvement (OERI) at the Department 
of Education and the National Institutes of Health. The Federation's 
testimony is directed toward the fiscal year 1999 appropriation 
requests for these two agencies.
             office of educational research and improvement
    Any discussion of OERI funding should encompass the agency's 1995 
reauthorization. That legislation was carefully crafted over the course 
of five years, and its aim was to make OERI one of the government's 
premier supporters of research and research applications. A major 
impediment to building a solid scientific knowledge base for 
educational improvement has been that OERI and its predecessor, the 
National Institute of Education (NIE) were buffeted by the political 
winds and by passing fads regarding educational interventions. NIE and 
OERI found themselves having to change gears to fit the current desire 
of those in power. That is not the right way to build a research 
knowledge base. The right way to do this is to look at the real 
problems in education and to develop research agendas to address those 
problems, much as the National Institutes of Health does with diseases. 
And so it is no happenstance that when OERI was reauthorized, it was 
organized into a series of research institutes, each focusing on a 
major problem area in education. It is also not a happenstance that an 
outside oversight board similar to the National Science Board of NSF or 
the advisory committees of the NIH was created to keep OERI on a steady 
course rather than to allow its programs to be whipsawed by each 
passing educational fad.
    Under the 1995 reauthorization, OERI's Field Initiated Studies 
(FIS) program which supports university-based research was expanded. 
The basic research produced under the FIS program lays the foundation 
for the applied work done in the labs and centers of the institutes. 
Funding for the FIS program needs to increase. The fiscal year 1999 
request includes a plan for 35 to 50 new field initiated studies, but 
does not include a request for increased funding. Reallocation of funds 
from expiring grants would be the method to support a new grant 
competition, without an increase this year. In fiscal year 1998, the 
OERI research budget was frozen at the fiscal year 1997 level making it 
impossible to sponsor a new grant competition, though the agency did 
maintain funding for previous FIS awards.
    OERI has developed a strategic plan to assure that the elements of 
the reauthorization accomplish their intended purposes. As a result, 
the OERI has taken substantial strides toward becoming a strong 
research and research applications agency for education. This process 
is ongoing and all indications are the reinvention of OERI is going 
well. The Congress deserves to take pride in its handiwork with respect 
to the reauthorization because the reauthorization has at last 
established a strong framework for the support of educational research 
and its applications. The best framework in the world, however, cannot 
accomplish its purpose without adequate funding.
    For OERI the Administration is requesting a 28.5 percent increase 
in funding levels across research, statistics and assessment. However, 
the bulk of this increase is slated for a new Interagency Research 
Institute, which is earmarked to receive a $50 million start-up budget. 
This new interagency research initiative is meant to be a collaborative 
effort between OERI, the National Science Foundation (NSF) and the 
National Institute of Child Health and Human Development (NICHD). An 
additional $25 million is expected from NSF for this project. The 
important point to make, however, is that this $50 million allocation 
is dependent upon the unresolved tobacco settlement. Without the 
tobacco settlement, only $15 million will be available for statistics 
and assessment and no increase is requested for the core research 
programs. The President's request for level-funding of the core 
research programs in fiscal year 1999 would make this the third year of 
a frozen budget for these programs. The Federation believes that to 
continue level-funding and not provide sufficient annual increases to 
these programs makes it impossible for OERI to meet fully the mandates 
of its 1995 reauthorization.
    The Federation supports a $15 million increase for fiscal year 1999 
for the core research programs and also supports the administration's 
desire to create an interagency education research program. We believe 
that linking the work of the Department of Education with NSF and NICHD 
will facilitate the passage of new knowledge from research to 
application.
                     national institutes of health
    The Administration is requesting an unprecedented 8.4 percent 
increase--the largest ever--for the National Institutes of Health 
(NIH). This would increase NIH's budget from $13.6 billion to $14.8 
billion, an increase of $1.1 billion. The Federation is joining with 
many other scientific organizations and key members of Congress in 
asking the subcommittee to recommend an even larger increase of 15 
percent for NIH. This increase would be the first step toward the 
doubling of NIH's budget within the next five years. We base our 
request for this substantial increase on two observations.
    The first is that the pace of discovery in the full spectrum of 
health sciences is accelerating, and the country needs to keep that 
momentum going. The second is that health care costs are at crisis 
proportions in this country, and one of the most important ways to 
control those costs is to find better ways to keep people healthy. The 
ultimate purpose of health research, including health research in the 
behavioral and social sciences, is to make the citizens of this country 
healthier throughout their life span.
    Some of the most significant advances in science in recent years 
have come from research in two large fields, genetics and neuroscience. 
The work being done in these areas is a prime example of how basic 
genetic and neuroscience research is contributing to our understanding 
of a number of diseases, such as Parkinson's, Alzheimer's, drug 
addiction and diabetes. Scientific advances in the biology of brain 
disease have been possible because of new methods for the study of the 
nervous system, such as neuroimaging.
    Understanding and identifying the molecules that guide the 
formation of the brain is allowing neurobiologists to visualize how the 
developing nervous system organizes itself, to explain complex 
behaviors, and to describe neurological and psychiatric diseases with a 
new level of precision.
    The emergence of cross-disciplinary collaboration has been a major 
component in the fast paced research developments in these arenas. 
Across the NIH-supported sciences, the growing tendency for scientists 
from many disciplines to come together to solve research problems has 
shown significant results. AIDS has not been cured, but research has 
shown how a mixture of treatments can ward off the worst effects of 
AIDS, for many years. These treatments involve the use of a variety of 
drugs in combination and they involve a demanding level of discipline 
on the part of the patient to take the medications properly--a 
discipline that can be trained by application of techniques developed 
through behavioral research.
    Similarly, recent NIH-supported behavioral research has produced 
useful new knowledge, including a better understanding of basic 
behavioral and social processes and how they interact with biological 
processes. This understanding is coming from many lines of research: 
studies of lifestyle choices, dietary habits, the desire and ability to 
maintain exercise or medication regimens, psychological functioning, 
and influences of one's social and cultural environment on behavior. 
All these lines of research converge to give us a picture of the 
factors that can affect an individual's ability to remain healthy or to 
recover from disease or to function well despite a chronic condition. 
And that knowledge leads to treatments and other interventions to 
maintain health through the life span. NIH's Office of Behavioral and 
Social Sciences Research (OBSSR) has been pivotal in supporting these 
studies and translating the findings into effective prevention and 
treatment strategies.
    OBSSR, under the purview of the Office of the Director of NIH, 
coordinates all the institutes and centers in marshaling their 
individual resources to collaborate on behavioral and social sciences 
research. OBSSR, for example, is overseeing a $3.7 million trans-agency 
research project intended to encourage the development of innovative 
behavior strategies for changing risk behaviors that cut across major 
disease categories. OBSSR chose these behaviors for collaborative 
research support because the diseases whose courses the research is 
intended to modify are among the top ten causes for premature mortality 
and morbidity. Sixteen NIH offices and institutes are funding this 
project, including NIAAA, NICHD, NIMH, and the Office of Dietary 
Supplements.
    OBSSR was established in 1995 by Congress. This project 
demonstrates how OBSSR fulfills one of its primary mandates, which is 
fostering the development of cross-disciplinary communication and 
research collaboration among various behavioral and social sciences and 
between the behavioral and social sciences and biomedical sciences. 
OBSSR's efforts are assuring that development of effective behavioral 
interventions is keeping pace with technological advances.
    OBSSR has been operating for several years now with a small staff 
and a small budget. The President's budget request for OBSSR for fiscal 
year 1999 is nominal--$2.66 million. OBSSR's current budget is $2.56 
million. The Federation supports an additional $1.5 million increase 
for fiscal year 1999 for OBSSR. This increase combined with the 
President's request would bring OBSSR's total budget to $4.2 million 
and would significantly augment OBSSR's ability to coordinate research 
across institutes. This is both an efficient use of resources and a 
beneficial mode of operation, because it links areas of related 
knowledge that might otherwise remain separated.
    Another prime example of the application of behavioral intervention 
in concert with the use of medicines has to do with deadly diseases 
that are reemerging after decades of dormancy in this country. 
Tuberculosis is the example that comes most readily to mind. A serious 
challenge is faced with respect to these diseases. When medications are 
misused, the result is not only that the patient's disease fails to be 
controlled, but also the bacterium that causes the disease is able to 
develop resistance to medication making the disease much more difficult 
to treat.
    These diseases are cropping up in indigent populations such as the 
homeless--among the hardest groups in our society to treat. Research is 
still underway to determine what behavioral interventions can best 
assure that such patients will carry their treatment through to 
conclusion. But behavioral and social scientists are working with other 
scientists and with health providers to find answers to the problem. 
Our experience with collaboration to date leaves every reason to 
believe that even in this very difficult area, solutions can be found 
if support is maintained for the research teams that seek the answers.
    NIH funding has permitted us to use research wisely, that is, in 
the combinations that will be most efficient in reaching solutions to 
typically multifaceted health problems. To continue successful 
biomedical and behavioral research at this level requires a major 
commitment by Congress to find the resources for expanding NIH's 
budget. With increased support, the current pace of discovery and 
collaboration can be sustained. The largest per person expenditures for 
health care occur near the end of life. One goal of research has become 
to understand what interventions through the life span will have the 
greatest promise of assuring that the period of great illness before 
the end of life is minimized.
    Behavioral research has a large role to play here because 
controllable choices and behaviors in life have a heavy impact on the 
quality of life of the aged. Obviously, such behavioral choices as to 
smoke or not to smoke and what foods and quantities of food to consume 
are among the most important choices we make in determining our health. 
But each of us knows how difficult it is to do the right thing.
    Behavioral researchers in cooperation with nutritional researchers, 
neuroscientists, epidemiologists and a host of other specialists are 
working to find ways to make it easier for people to make the right 
choices about their health. The payoff for finding solutions to these 
problems will be not only a healthier population, but also the 
shrinkage of health care costs to a manageable size without sacrificing 
the well-being of the country's citizens. Through research it is 
becoming possible to maintain good health and keep health care costs 
down at the same time.
    We strongly urge the Subcommittee to recommend a 15-percent 
increase for NIH because the investment in knowledge will result in 
healthier citizens and health care cost savings that far exceed the 
research investment. And by the same token slighting research will 
assure that rising health care costs will remain among our most serious 
national crises.
    We thank the Subcommittee for the opportunity to present our views.
                                 ______
                                 
                        DEPARTMENT OF EDUCATION
 Prepared Statement of the American Indian Higher Education Consortium
I. Introduction
    Mr. Chairman and Members of the Subcommittee, on behalf of this 
nation's 30 American Indian Tribal Colleges, which comprise the 
American Indian Higher Education Consortium (AIHEC), we thank you for 
the opportunity to share our funding requests for the Department of 
Education's fiscal year 1999 programs.
    We have four specific funding requests:
  --A section is now being authorized under Title III of the Higher 
        Education Act specifically for Tribal Colleges, and we request 
        that this section be funded at the authorized level of $10 
        million.
  --Funding under section 103 of the Carl D. Perkins Vocational 
        Education and Applied Technology Act (set-aside for Indian and 
        Hawaiian Natives) should be at a level of $15.9 million; the 
        Tribally-controlled Postsecondary Vocational Institutions 
        program should be funded at no less than $3.1 million; and 
        other Vocational and Adult Education programs should be funded 
        at the levels requested in the President's budget.
  --Under Title IV, we have two priorities: (a) Funding for the Title 
        IV campus-based assistance programs, including work-study, 
        SEOG, and TRIO, should be fairly allocated to all institutions 
        with documented need. (b) Funding for the Pell Grant program 
        should be increased, over a period of five years, to the level 
        of educational cost coverage provided in the late 1970's and 
        early 1980's.
  --The new White House Initiative on Tribal Colleges, which is housed 
        in the Department of Education, will need support and oversight 
        by the Congress. We support the President's request of $200,000 
        for this office and ask your subcommittee to build upon his 
        budget to a level of $500,000.
    Mr. Chairman, this statement will cover two topics: first, it will 
provide some background on the Tribal Colleges, including information 
on the tremendous challenges we face as we cope with the effects of 
welfare reform; and second, it will provide justifications for the 
above funding requests.
II. Background on tribal colleges
    The dismal statistics concerning the American Indian experience in 
education brought tribal leaders to the realization that only through 
local, culturally-based education could many American Indians succeed 
in higher education and help bring desperately needed economic 
development to the reservations. The most remote reservation 
communities were heavily struggling with this problem. The Tribal 
College movement began more than 25 years ago as a very sound and well 
thought-out solution to this problem. In the late 1960's and early 
1970's, the first Tribal Colleges were chartered on remote reservations 
by their respective tribal governments, to be governed by boards of 
local tribal people. These first colleges were born, with little money 
and a lot of determination, in abandoned and condemned government 
buildings and old trailers, using three-legged desks, wood crates for 
shelves and typewriters with missing keys. In 1972, the first six 
fledgling tribally-controlled institutions came together to form the 
American Indian Higher Education Consortium. Today, AIHEC is a 
cooperatively sponsored effort and integral support network for 30 
member institutions in the United States and one in Canada.
    Tribal Colleges now serve 26,700 students each year, offering 
primarily 2-year degrees, with some colleges offering 4-year and 
graduate degrees. Together, the colleges represent the most significant 
and successful development in American Indian education history, 
promoting achievement among students who may otherwise never know 
educational success. All of the Tribal Colleges are fully accredited, 
with the exception of the four newest institutions that are 
accreditation candidates.
    Despite our successes, Tribal Colleges remain the most poorly 
funded institutions of higher education in this country, and although 
conditions at some have improved substantially, many of the colleges 
still operate in trailers, cast-off buildings, and facilities with 
leaking roofs. Our core funding, which is authorized under the 
Tribally-Controlled Community Colleges Assistance Act of 1978 and 
funded through the Department of Interior appropriations bill, remains 
grossly inadequate. In fact, the Tribal Colleges' appropriation of 
$3,017 per Indian student is dramatically less than the average per 
student revenue of mainstream 2-year institutions. It is also far below 
the authorized level of funding, which is $5,820 per Indian student.
    In addition to providing academic, vocational, and technical 
programs similar to those at mainstream institutions and cultural 
language and history courses unique to American Indian tribes, Tribal 
Colleges provide services above and beyond those provided by most other 
post-secondary institutions. All Tribal Colleges provide GED, basic 
remediation, and other college preparatory courses, probably more than 
any other community colleges in this country. We have done this because 
their missions require them to help move American Indian people toward 
self-sufficiency and help make American Indians productive, tax-paying 
members of American society.
    Tribal College students are often older--the average age is 27. 
They are typically single parents, the majority of whom are mothers 
with small children, and they are extremely poor. Most are dependent on 
welfare, and with young families, they are unable or unwilling to leave 
their small reservation communities to go away to school. Yet, they 
want to get off welfare and provide for their families, so they turn to 
the Tribal Colleges.
III. The impact of welfare reform and justifications for funding 
        requests
    Fulfilling our obligation to serve Indian people will become 
increasingly more difficult over the next several years for two 
reasons: (1) federal funding resources are not keeping pace with 
expanding enrollments; and (2) as a result of welfare reform 
legislation, more and more welfare recipients are turning to Tribal 
Colleges for training and employment opportunities. Most Tribal 
Colleges are located on remote reservations in isolated communities 
that lack the support of basic public services available and supported 
by strong state and local governments with access to stable tax support 
systems. Given this reality, Tribal Colleges are obligated to offer a 
wide range of community services, such as education, job training, 
childcare, and community support services. They serve as community 
centers, providing libraries, tribal archives, career centers, economic 
development centers, and public meeting places. Over the next several 
months and years, we expect the demand for these services--along with a 
tremendously increased need for basic education and training services--
to expand dramatically.
    In the isolated Indian communities Tribal Colleges serve, current 
welfare recipients simply have no other place to turn. They must look 
to the local Tribal College for much needed--and required--education 
and job training. But before many can even begin the course work needed 
to learn a productive skill, they first must earn a GED or learn to 
read. According to a Carnegie Foundation survey, 20 percent of the 
students questioned had completed a Tribal College GED program before 
beginning formal classes at the Tribal College. At some schools, the 
percentage is even higher. For example, Lac Courte Oreilles Ojibwa 
Community College in Wisconsin reports that nearly one-third of its 
students had earned a GED through its tutoring and testing center. 
Clearly, the need for basic educational programs is tremendous, and it 
will increase as changes in the welfare laws are implemented.
    Officials at Tribal Colleges agree that the old welfare system did 
not work. In fact, the missions of the Tribal Colleges are specifically 
targeted toward self-sufficiency and productivity. This has been the 
work of the colleges from their inception. Tribal Colleges want to 
continue to share in the responsibility of making the new welfare 
system work. The future of our people depends upon it. But Tribal 
Colleges cannot be successful if resources remain too inadequate to 
deal with the impact of the new laws. They must be fully prepared and 
given the appropriate resources to deal with the increases in 
enrollment, new program implementation, and expanded remediation 
services and programs.
                         further justifications
    (1) A new part should be established under Title III of the Higher 
Education Act (HEA) specifically for Tribal Colleges, and this section 
should be fully funded at the expected authorized level of $10 million. 
Currently, both the House and Senate HEA reauthorization bills include 
the creation of a new Tribal College section for Title III, 
Strengthening Developing Institutions. The House Workforce Committee 
has authorized a $10 million competitive program, and the Senate 
Committee has authorized $5 million. Both measures are awaiting floor 
action and conference. We are hopeful that the final authority will 
remain at a $10 million level.
    As you know, Title III of the Higher Education Act was created to 
assist institutions that historically have served minority and low-
income students who have been denied access to postsecondary education 
because of race or national origin. According to the Act's findings, 
these institutions serve students ``whose participation in the American 
system of higher education is in the Nation's interest so that equality 
of access and quality of postsecondary education opportunities may be 
enhanced for all students.'' In 1980, a specific part was created 
within Title III to provide assistance to Historically Black Colleges 
and Universities (HBCUs), and in 1992, a new section was added to 
provide specific funding for Hispanic Serving Institutions (HSIs). 
Today, we request your support for the full funding of this new part 
within Title III for Tribal Colleges.
    A quick review of the findings of either Title III or Part B will 
make abundantly clear Title III's applicability to Tribal Colleges. 
Tribal Colleges were created specifically to serve a population that 
had been denied full access to America's higher education system. Our 
mission is to educate American Indian people and others on our 
reservations and to help prepare them to enter this nation's workforce. 
A separate section will greatly enhance the ability of Tribal Colleges 
to participate in Title III's programs. Over the past several years, 
Tribal Colleges have been nearly shut out of Title III participation. 
In 1991, fourteen Tribal Colleges received Title III grants. In 1994, 
not one Tribal Colleges received a new Title III grant. In 1995, five 
institutions received new funding, but in 1996, no new schools received 
Title III grants. Currently, only seven schools are participating in 
the program at all, half the number of seven years ago. The Tribal 
Colleges' developmental needs are overwhelming. When accessed, the 
Title III program has been extremely important in bringing support in 
areas such as faculty and curriculum development, student services, and 
critical community-building programs. We urge the Subcommittee to fully 
fund this urgently needed authority.
    (2) Under Title IV, we have two priorities: (a) Funding for the 
campus-based assistance programs, including work-study, SEOG, and TRIO, 
should be fairly allocated to all institutions with documented need. 
(b) Funding for the Pell Grant program should be increased, over a 
period of five years, to the level of educational cost coverage 
provided in the late 1970s and early 1980s. Unfortunately, Tribal 
Colleges are not able to fully participate in many of the other higher 
education programs authorized by this Subcommittee because of existing 
barriers in funding formulas, laws, regulations, and grant-making 
procedures. Newer institutions, like the Tribal Colleges, should not be 
penalized solely because they have not been in existence for more than 
25 or 30 years. Yet, this is exactly what happens with campus-based 
programs like the Supplemental Educational Opportunity Grants (SEOG) 
and work-study programs. A recent report by the Institute for Higher 
Education Policy showed that in 1994-95, students at Tribal Colleges 
received only an average SEOG of $326, significantly lower than the 
national average of $559.
    Mr. Chairman, we are simply asking for parity within these 
programs. We do not believe that our institutions should be penalized, 
when documented student need is equal or greater, simply because we 
were not in existence when a program was originally established or 
modified. One suggestion is that disbursement of funds could stipulate 
that priority for full funding be given to institutions with high rates 
(85 percent or higher) of students in financial need.
    In addition, we support the President's request for an increase of 
$100 per student award as a positive step toward this goal, and we urge 
the Subcommittee to supplement this amount. The importance of Pell 
Grants to our students cannot be overstated. Education Department 
figures show that half of all Tribal College students receive Pell 
grants, primarily because student income levels are so low, and they 
have far less access to other sources of aid than students at 
mainstream institutions. The inadequate funding Tribal Colleges receive 
from the federal government has forced most of the colleges into a 
position of increasing reliance on tuition for institutional 
sustainability. As a result, tuition levels at Tribal Colleges are as 
much as 30 percent higher than the average for mainstream public 
community colleges-in 1994-95, the average tuition at a Tribal College 
was $1,580, compared with a national average of $1,190 at community 
colleges.
    Most Tribal Colleges are too young and too poor to have established 
endowments and other scholarship programs, and our students receive 
virtually no aid from the states. Many of our students would not be 
attending college and preparing to enter the workforce today if it were 
not for Pell grants; instead, they would be counted among the ranks of 
the unemployed. Within the Tribal College system, Pell grants are doing 
exactly what they were intended to do: they are serving the needs of 
the lowest income students by helping people gain access to higher 
education and become active, productive members of the workforce. We 
urge you to support and expand upon this valuable program.
    (3) Funding under section 103 of the Carl D. Perkins Vocational 
Education and Applied Technology Act (set-aside for Indian and Hawaiian 
Natives) should be at a level of $15.9 million; the Tribally-controlled 
Postsecondary Vocational Institutions program should be funded at no 
less than $3.1 million; and other Vocational and Adult Education 
programs should be funded at the levels requested in the President's 
budget. Basic grants and school-to-work funding will be particularly 
beneficial to the Tribal Colleges as we attempt to deal with the 
challenges tribal communities face as a result of welfare reform, and 
we support adequate levels of funding for these programs. Also, it is 
important to note that the $3.1 million for Tribally-controlled 
postsecondary vocational institutions provides core funding for two of 
our members, United Tribes Technical College is Bismarck, North Dakota, 
and Crownpoint Institute of Technology in Crownpoint, New Mexico.
    (4) The new White House Initiative on Tribal Colleges, which is 
housed in the Department of Education, will need support and oversight 
by the Congress. We request appropriations of $500,000 for this 
important office. The Subcommittee needs to be aware of this new 
office, which is now housed within the Department of Education's Office 
of Adult and Vocational Education. This office will help ensure that 
Tribal Colleges are not overlooked in the creation and administration 
of federal programs. The office was mandated by the Executive Order on 
Tribal Colleges and Universities (No. 13021), which the President 
signed in 1996 after years of advocacy by the Tribal Colleges. The 
Senate heavily supported the signing of the Executive Order and 
actively sought this long-overdue recognition through Senate Res. 264, 
103rd Congress.
    One of the greatest challenges that Tribal Colleges face is 
overcoming a surprising lack of awareness among most federal 
departments and agencies. Program administrators simply do not know we 
exist. This office will help address this fundamental problem, as 
similar offices have for Historically Black Colleges and Universities 
and Hispanic-Serving Institutions for a number of years. In addition, 
the office will coordinate Departmental and agency participation in the 
mandates of the Executive Order; assist in the development of agency 5-
year plans aimed at reducing program participation barriers; and, 
report to the President on the inclusion of the Tribal Colleges in 
various departmental programs.
IV. Conclusion
    In light of the justifications presented in this testimony and the 
even further enrollment increases that will result from welfare reform, 
we urge the Subcommittee to increase funding for Tribal Colleges. 
Fulfillment of AIHEC's fiscal year 1999 request will strengthen the 
mission of these colleges and the enormous, positive impact they have 
on their respective communities and will help ensure that they are able 
to properly educate and prepare thousands of American Indians for the 
workforce of the 21st century. Without the Tribal Colleges to serve as 
the means for moving from welfare to work, much of the reform 
accomplished by the Congress will fail throughout Indian Country. As 
demonstrated in this testimony, Tribal Colleges have been extremely 
responsible with the federal support they have received in the last 17 
years. It is important that the Federal Government now capitalize on 
its investment. As the recent Carnegie report stated, ``Now, as 
strongly as ever, we repeat our conviction that Tribal Colleges deserve 
continued support. Their value has been proven, but their vision is not 
yet fulfilled'' (Native American Colleges: Progress and Prospects, 
Carnegie Foundation for the Advancement of Teaching, 1997). These 
institutions have proven themselves as a sound federal investment, and 
we ask for your continued support.
    Thank you again for this opportunity to present our request before 
this Subcommittee. We respectfully ask the Members of this Subcommittee 
for their continued support and full consideration of our fiscal year 
1999 appropriations request.
                                 ______
                                 
 Prepared Statement of John S. Megerson, Director of Police, on Behalf 
                of the Southwest Texas State University
    I appreciate the opportunity to present written testimony 
concerning proposed changes in the Crime Awareness and Campus Security 
Act of 1990 as offered in H.R. 715, Accuracy in Campus Crime Reporting 
Act of 1997 and request that this testimony be entered into the Record. 
I do so as Legislative Chair for the Texas-New Mexico Association of 
College and University Police Departments, as a 35-year member of the 
criminal justice community, and as Director of University Police for 
Southwest Texas State University.
    You have already received a position statement from the Texas-New 
Mexico Association of College and University Police Departments 
concerning the provisions of H.R. 715. That document deals primarily 
with specific provisions of the bill and difficulties inherent in 
compliance. I will not re-address those at this time. The purpose of my 
testimony is an effort to persuade you to recognize the direction you 
are being asked to pursue will result in the development of data which 
will not serve the interests or intent of those who promoted the 
approval of the Crime Awareness and Campus Security Act of 1990. 
However, I will offer a solution I believe may be acceptable to those 
with concerns over compliance and needed data.
    In summary, you are being asked to approve legislation that would 
force educational institutions and their law enforcement and security 
organizations to produce and publish data and statistics that are 
incongruent with one another. In many respects the proposed legislative 
amendments require us to produce not what we ``know'' to have occurred, 
but what we ``suspect'' to have occurred. Such information is not 
subject to objective analysis and interpretation.
    When the original Crime Awareness Act was passed it focused upon 
the reporting of ``campus crime'' and the publication and transmission 
of policies and services dealing with victimization and crime 
prevention. As the rules were developed, changes made and audits 
conducted, the focus began to change as well. While boundaries were 
set, those who set them are no longer comfortable and want them 
extended to streets passing through the campus, to streets patrolled by 
campus police on the perimeter of a campus, to public housing off 
campus as well as campus approved organization housing.
    The quest also includes buildings and facilities leased to private 
enterprise for public businesses not controlled by universities anymore 
so than does an owner of a property leased to a university for 
university business. Some compliance audits have extended those 
boundaries to include crime occurring in other cities while a student 
is on an educational trip approved by the university.
    The focus is no longer on crime occurring ``on'' a campus, but 
``to'' a student associated with a campus and the pursuit is 
progressing well beyond that level of information. This is not Campus 
Crime data. This is Community and Student Victimization and Behavioral 
data. These are vastly different kinds of data and the meaning and 
interpretation draw entirely different pictures and conclusions. 
Including unsubstantiated reports of other crimes and associated 
infractions for which there is no criminal charge, but for which the 
individual might be liable (Student Justice) paints an abstract picture 
for which the interpretation is in the eye of the beholder. It is not 
objective, quantifiable or definable in any terms that are universally 
acceptable.
    Where we were once concerned with crimes as defined by the Uniform 
Crime Reporting System, we are now being asked to concern ourselves 
with behaviors and infractions not defined by the UCR, i.e., student 
disciplinary violations and code of conduct violations for which an 
individual was not criminally charged. You have heard testimony seeking 
the equivalent of background checks on prospective students and annual 
drug screening of those receiving federal student loans. That is not 
campus crime data and is not germane to an act dealing with such data. 
You have heard testimony seeking the publication of data concerning 
drug, alcohol, and weapons ``violations'' rather than arrests. Merging 
violation data with ``crime and arrest data'' will not create a report 
that is subject to objective interpretation. This attempt to identify 
every law or university rule violated by an individual in the course of 
one incident for which he/she is accountable in more than one venue 
will obscure the true picture.
    You have heard the testimony and read amendments asking for the 
publication of crimes reported to ``other campus officials'' that may, 
or may not, have been reported to law enforcement or campus security. 
You are being asked to require campus police and security departments 
to publish and ``certify'' crimes reported to others which we cannot 
investigate or verify; crimes which when reported to us do not contain 
the names of victims so that we do not record the same report several 
times, depending upon who heard it last.
    As you think about extending the boundaries of crime reporting, 
please think about New York City, Los Angeles, Miami, Baltimore, every 
major city in this country. Each is home to a number of colleges and 
universities; some within a block or so of one another. In Davie, 
Florida, there are three institutions of higher education across the 
street from one another and only a mile or so from still other 
universities. When I sent my daughter to the University of Miami I was 
not nearly as interested in the campus crime rate as I was the crime 
rate in Dade County, Florida. I was concerned about campus burglary and 
theft and the quality of the campus police. I was concerned about the 
residence hall staff and the vigor with which they enforced their 
rules. I knew my daughter would not spend her every waking moment on 
that campus. I knew she would go with friends to a number of off-campus 
establishments, events, parties, and sightseeing. It was the total 
environment that concerned me, not just the campus.
    While the University of Pennsylvania and the Department of 
Education are charged with having erred in terms of the spirit or 
intent of the law regarding what constitutes the campus, as with any 
law, the definitions prescribed are those that must be followed. To re-
write the law and expand its prescriptions in an effort to correct this 
perceived ``flaw'' will not correct the problem. No matter what college 
or university is examined, at some point the boundary of the campus 
will end. Across the street will not be the campus and a crime 
occurring there will not be included. That is the nature of boundaries. 
However, there is a solution which should meet the intent of the 
original law, i.e., to allow students and parents to evaluate the crime 
climate of a prospective college or university.
    With that as a preface, what I suggest is that the focus of crime 
disclosure information should be on the community as a whole in which 
the college or university is located. If a parent is going to look at 
crime data as a part of the selection process of a college or 
university, that is what they need to know, not just campus crime. 
Focus on a report that includes the ``campus crime rate'' as it is 
currently defined and a section that includes the same data for the 
political subdivision in which the institution is located. Both receive 
federal funds. Both deal with the same clientele. Both have the same 
statistical resources. In the vast majority of cases I am sure one will 
see a campus crime rate substantially lower than the surrounding 
community but, as other testimony has reflected, that is not the full 
picture that needs to be available. Hold the local community as 
responsible for the accuracy and disclosure of crime information as you 
would the university for its information, but do not hold the 
university accountable for the surrounding community.
    Each affected institution is located in a police jurisdiction other 
than its own, e.g., a city, county, borough, or township which is 
broken into precincts, districts or some comparable police patrol and 
statistical area. Thus, the solution is to require those police 
jurisdictions to submit crime data to that institution (according to 
the prescriptions in the Crime Awareness Act) for their patrol area(s) 
in which the educational institution is located. Then, hold the 
educational institution responsible for publishing both the crime 
occurring on its own campus and that in the surrounding police 
jurisdiction or patrol area(s) in which it is located.
    Each of those contiguous police jurisdictions receives federal 
funds for a variety of programs. To insure compliance with this 
provision, all that need be done is require all federal funding sources 
for local police agencies to include in their award criteria a 
requirement that they will comply with the provisions of the Crime 
Awareness and Campus Security Act; a failure to do so resulting in the 
withdrawal of their federal aid.
    Use of this data would be an effective reference for major 
metropolitan areas without requiring the distribution of an entire 
city's crime rate, e.g., New York City, Miami, etc.; such data not 
being helpful to prospective students. In rural or suburban communities 
the patrol areas might be quite large and encompass a major portion of 
a community or county. In this way, you will have made the distinction 
between the ``Campus'' and the ``Campus Community,'' a clearly 
important distinction in terms of crime as evidenced by the testimony 
and concern shown over campus boundaries.
    In terms of disciplinary actions and rules violations, as 
previously stated, this is entirely different data. Many of these may 
be ``crimes'' in the technical sense, but they are normally not crimes 
for which the judicial process will take action. They are behaviors 
that violate codes of conduct for which there is an entirely different 
burden of proof for accountability and should not be included in an 
``Annual Crime Report.'' This is information that should be included in 
Student Services materials transmitted to all students, e.g., 
application materials and the Student Code of Conduct. This is 
information that tells the prospective students and parents the 
university has rules it enforces whether or not the student is 
accountable under criminal law.
    This development of two reports draws an important distinction and 
creates a much clearer picture of the university environment in terms 
of crime and in terms of acceptable behavior within that community.
                                 ______
                                 
    Prepared Statement of the National Indian Education Association
    The National Indian Education Association (NIEA), the oldest 
national organization representing the education concerns of over 3,000 
American Indian and Alaska Native educators, school administrators, 
teachers, parents, and students, is pleased to submit this statement on 
the President's fiscal year 1999 budget as it affects Indian education. 
NIEA has an elected national board of 12 members who represent various 
Indian education programs and constituencies. Every year, NIEA holds an 
annual convention which provides our members with an opportunity to 
network, share information, and hear from Congressional leaders and 
staff as well as federal government officials on policy and legislative 
initiatives impacting Indian education.
    We commend President Clinton for a budget that emphasizes the 
importance of education for all citizens of this country, including the 
First Americans. There are some programs such as the Office of Indian 
Education (OIE) in the Department of Education, Impact Aid and higher 
education scholarships which deserve further consideration for 
increases. Other issues which may arise this year, such as block 
granting Department of Education funding, need to be considered very 
carefully by the Congress. Funding for certain Indian education 
programs are the result of the Federal/Tribal Trust relationship and 
may not be conducive to these types of funding proposals.
    President Clinton has proposed several new education initiatives 
for fiscal year1999. Some of these depend on passage of a proposed 
Tobacco Settlement. Administration proposals like the School 
Construction Tax Credit and the Class-Size Reduction Initiative are 
desperately needed by schools operated and funded by the Bureau of 
Indian Affairs (BIA) as well as many rural public schools.
The Federal responsibility for Indian education
    Indian education programs are not affirmative action nor race-based 
educational efforts but result from the historical and legal 
relationship between Indian nations and the Unites States. This 
government-to-government relationship is a Constitutional relationship 
whereby the U.S. officially recognizes some 557 Indian and Alaska 
Native governments as separate and distinct nations. This political 
relationship includes broad federal authority and special trust 
obligations unique only to American Indians and Alaska Natives. Tribal 
governments are independent of State governments even though tribal 
lands may lie within a state's geographic boundaries. Many federal 
statutes provide for direct funding to tribal governments so that 
tribes can design and administer their own programs. Among activities 
undertaken by tribal governments are the administration of their own 
police departments, courts, schools, health facilities, social service 
programs, the development and enforcement of environmental codes, etc. 
Many programs formerly administered by the Bureau of Indian Affairs 
(BIA) or the Indian Health Service (IHS), are now carried out by Tribes 
under authority of the Indian Self-Determination and Education 
Assistance Act (Public Law 93-638) and the Indian Education Act of 1972 
(as amended by Title IX, Public Law 103-382). Tribally chartered boards 
now administer more than 90 BIA-funded elementary and secondary schools 
and 29 tribal colleges.
Indian education executive order
    For the past three years, NIEA has worked cooperatively with the 
National Congress of American Indians (NCAI) and the Native American 
Rights Fund (NARF) in developing an Executive Order on a Comprehensive 
Federal Indian Education Policy Statement (CFIEPS). The intent of this 
policy is to formally set national guidelines for Indian education 
programs which would be applicable to all federal agencies. The 
uniqueness of this document is that it is tribally-endorsed, 
encompasses all education levels and reflects the historical nature of 
federal education policy. These guidelines are broad enough to define 
and direct federal agency implementation of all congressional and 
executive branch level Indian education initiatives including budget 
appropriations. The CFIEPS has been forwarded to the Clinton 
Administration with several House and Senate Members endorsing the 
proposal. We urge this subcommittee's endorsement of a Presidential 
Executive Order on Indian Education. Below are our funding 
recommendations for those Indian programs under the jurisdiction of the 
Labor, HHS and Education Appropriations Subcommittee.
                        department of education
I. Office of Indian Education (OIE)
    For fiscal year 1999, the Department of Education has requested $66 
million to fund formula grants to Local Education Agencies (LEAs), 
partially restore discretionary funding for OIE and fund certain 
National Center for Education Statistics (NCES) surveys. NIEA supports 
full funding for OIE in the amount of $83 million, $17 million more 
than the fiscal year 1999 President's Request. This amount, in addition 
to LEA grants, would permit a variety of discretionary grant programs; 
full funding for the National Advisory Council on Indian Education 
(NACIE) and partial funding for the Presidential Executive Order on 
Tribally Controlled Community Colleges (TCCC). NIEA requests partial 
funding for the TCC Executive Order since its implementation requires 
other Education Department agencies to combine resources. In 1997, 
budget authority for OIE transferred from Interior to this 
Subcommittee.
    Partial funding in the amount of $3.3 million has been restored for 
OIE's discretionary program called Special Programs for Indian 
Children. NIEA requests the Committee's support for full reinstatement 
for other discretionary programs in adult literacy and Indian 
fellowships. The Department's support for Indian students throughout 
its other programs is well established and appreciated by the Indian 
community; however, few Departmental initiatives are available for 
Indian adults and Indian students attending postsecondary institutions. 
This educational gap prevents full educational access generally assured 
other students. NIEA's fiscal year 1999 request proposes to fill this 
educational inequity. The following are NIEA's recommendations 
regarding OIE funding by category:
  --Formula Grants to LEAs.--For fiscal year 1999, the U.S. Department 
        of Education has requested $62 million for its formula grant 
        program to public schools. The Department estimates that this 
        funding assists 405,376 Indian students attending public and 
        43,089 students attending Bureau of Indian Affairs (BIA) 
        schools for a total of 448,465 students. Approximately 80 
        percent of BIA students receive assistance under OIE's formula 
        grant program to LEA's.
  --Special Programs for Indian Children.--NIEA supports the 
        Department's effort to partially restore discretionary funding 
        for certain OIE programs. The request includes $3.3 million for 
        the Special Programs for Indian Children. This account, if 
        funded, would assist two initiatives: (1) demonstration grants 
        for early childhood and preschool education and (2) preparation 
        of Indians to take positions in teaching and school 
        administration. The $3.3 million increase falls far short of 
        the amount needed to reinstate several critically needed Indian 
        Education programs such as Indian fellowships, adult education 
        programs and additional demonstration grant resources.
  --National Activities.--The Administration requests $735,000 in 
        fiscal year 1999 to augment the Year 2000 National Center for 
        Education Statistics (NCES) Schools and Staffing Survey (SASS). 
        The data collection effort would ensure that American Indian 
        students are included in upcoming NCES surveys that will yield 
        additional information on American Indian learners.
  --NIEA appreciates the targeted increases for Indian education, but 
        continues to be concerned that studies on American Indian 
        students are not already a part of the Department's data 
        gathering effort. Most other ethnic populations receive 
        considerable research results without having their respective 
        program budgets cover the cost. A 1996 report by the United 
        States Commission on Civil Rights titled the `Equal Educational 
        Opportunity Project Series, Vol. 1' found that Department of 
        Education data on student characteristics was lacking among 
        students from American Indian, Asian and other national 
        backgrounds. The report stated that ``accurate, reliable and 
        complete data on these ethnic groups are vital for the efforts 
        of the education community to assess the needs of all student 
        sub-populations.'' The report recommended that documents from 
        the Department of Education's Office of Educational Research 
        and Improvement (OERI), and other federal agencies that contain 
        data utilized by policy and decision makers, should include 
        information on these populations. NIEA echoes this position and 
        recommends that the Department of Education make a concerted 
        effort to provide accurate research data on American Indians 
        and Alaska Natives when conducting studies and that they do so 
        with funds requested through their own research department.
  --Tribal College Executive Order.--When the President's budget was 
        released, funding amounts for the Tribal Colleges Executive 
        Order was not available. In fiscal year 1998 the funding 
        through OIE was $200,000. NIEA has been informed by the 
        Department that other agencies are expected to contribute to 
        the Order's implementation. NIEA supports the tribal colleges 
        in their request for full funding of this office.
  --The National Advisory Council on Indian Education (NACIE).--NACIE 
        is recommended at only $50,000 the same amount as fiscal year 
        1998. NIEA requests that the Committee consider full funding 
        for NACIE in order for it to carry out its mandated under the 
        Indian Education Act of 1972. This would require at least 
        $400,000 additional in fiscal year 1999. NACIE currently has no 
        permanent office and must rely on OIE staff to carry out 
        minimal functions. NIEA has made every effort to involve NACIE 
        in several Indian education initiatives including a proposed 
        Indian Education Executive Order, which intends to utilize 
        NACIE's advisory role in its implementation. NIEA also requests 
        that NACIE be permitted to hold hearings on Indian Education 
        issues during the 1999 reauthorization of the ``Improving 
        America's Schools Act''.
  --OIE Fellowship and Adult Education Programs.--Another loss, from 
        which Indian Country has yet to fully recover, is the Indian 
        Fellowship and Adult Education Program. These programs were 
        last funded in fiscal year 1996 and represents a broad, non-
        targeted approach, to ensuring Indian student participation in 
        postsecondary education. NIEA supports a funding level of at 
        least $3 million for the Indian Fellowship Program and $5.5 
        million for Adult Education. At its peak, the fellowship 
        program funded approximately 150 students. The adult education 
        grants served more than 30 Native communities and tribal 
        colleges.
II. Other DoEd Indian Education-Related Programs
  --Goals 2000.--NIEA supports the President's request for Goals 2000 
        in the fiscal year 1999 budget of $501 million. This represents 
        a $10 million increase over the 1998 appropriation of $491 
        million. One percent of Title III funds for Territories and 
        BIA-funded schools are used to support comprehensive, systemic 
        education reforms to improve teaching and learning. The fiscal 
        year 1998 budget for Bureau of Indian Affairs schools was $3.8 
        million with $3.6 million proposed in fiscal year 1999.
  --Safe and Drug-Free Schools.--NIEA supports the fiscal year 1999 
        request for Safe and Drug-Free Schools of $606 million, or $50 
        million more than in 1998. State grants under this program 
        total $526 million. BIA schools receive a one percent set-
        aside, which in 1998 was $5.3 million. The fiscal year 1999 
        request is expected to be the same with 40,000 Indian students 
        benefitting.
  --School-To-Work.--NIEA supports the President's request for School-
        To-Work funding. The President's request cuts the School-to-
        Work vocational education program by $75 million or 37 percent 
        in fiscal year 1999. The fiscal year 1999 request is $125 
        million with an equal request from the Department of Labor 
        bringing the total program to $250 million. This program is due 
        to phase out in 2001, with States or other vocational education 
        dollars continuing the program. Up to one percent of program 
        funds are set-aside for programs to help Indian youth acquire 
        the knowledge and skills they need to make a smooth transition 
        from school to career-oriented work and further education and 
        training. In fiscal year 1998 the amount available for Indian 
        students would be $2 million with $2.4 million proposed for 
        fiscal year 1999.
  --Title I.--Title I, Education for the Disadvantaged, covers four 
        programs: Title I basic grants; Title I concentration grants; 
        Title I targeted grants; and capital expenses for private 
        school children. The fiscal year 1999 request for Title I Basic 
        Grants is $6.270 billion, an increase of $788,000 (less than 
        0.1 percent) over 1998. The BIA set-aside amount under this 
        appropriation would be $47 million and serve 24,500 Indian 
        students. NIEA supports the President's request.
  --Comprehensive School Reform.--This Title I initiative was funded in 
        fiscal year 1998 at $120 million and funds research based 
        school-wide reform. The fiscal year 1999 request is $150 
        million. Under this proposal, BIA and the U.S. Territories 
        would receive a 1 percent set-aside, estimated at approximately 
        $2.7 million. The Department of Education notified the BIA that 
        their portion of the set-aside would be $896,402. From this 
        amount, $815,323 would be used for Title I comprehensive school 
        grants and $81,079 would be used for Fund for the Improvement 
        of Education projects. NIEA is concerned that the usual share 
        for BIA and Territories combined funding from typical set-
        asides is divided according to an average 60/40 split. A ruling 
        from the Department of Education recommends 33 percent instead 
        of the standard 60 percent allotment. We oppose this ruling and 
        support funding for BIA schools at no less than 60 percent.
  --Impact Aid.--NIEA does not support the Administration request of 
        $696 million, which is $112 million less than the 1998 amount. 
        Impact Aid compensates school districts in areas where large 
        numbers of children live on, or are associated with, Federal 
        property such as Indian reservations or military bases. In 1998 
        the Department estimated that over 118,000 Indian children 
        living on Indian lands would generate approximately $214.5 
        million for local school districts. In fiscal year 1999, 
        American Indian students will generate approximately $270 
        million for local public schools. Based on 1998 funding, Impact 
        Aid school districts would lose funding from approximately 2.7 
        million students (based on a total 1998 enrollment of 20 
        million students), should the funding not be restored. NIEA 
        urges the Committee to support restoring the $112 million for 
        Impact Aid school districts.
  --Education for Homeless Children and Youth.--NIEA supports the 
        fiscal year 1999 request of $30 million for Education of 
        Homeless Children and Youth. Under this program, the BIA 
        receives a one percent set-aside for homeless students served 
        by the BIA.
  --Bilingual Education.--NIEA supports the Bilingual Education request 
        of $232 million. American Indians receive indirect funding for 
        Bilingual Education programs in the amount of $30.2 million. 
        Funding is distributed through grants to school districts to 
        address the severe academic problems of school children who are 
        limited English proficient. The Department estimates that 
        182,000 American Indian students will receive bilingual 
        education assistance in fiscal year 1999.
  --Special Education Grants to States.--NIEA does not support the 
        Administration's fiscal year 1999 request for Special Education 
        programs since it is only increased by $35 million to $4.8 
        billion. The Individuals with Disabilities Education Act (IDEA) 
        was reauthorized in 1997 as Public Law 105-17. BIA schools 
        receive 1 percent for the education of children 5-21 years with 
        disabilities who live on reservations. An additional .25 
        percent is allocated for distribution to tribes and tribal 
        organizations to provide for the coordination of assistance and 
        related services for children aged 3-5 with disabilities on 
        reservation schools. The set-aside amount in the fiscal year 
        1999 budget request is estimated at $46.7 million. 
        Approximately 7,000 Indian students with disabilities would be 
        served with Special Education funding. NIEA voiced its 
        opposition during the reauthorization of IDEA as bill authors 
        proposed to lower the Indian set-aside amount from 1.5 to 1.25 
        percent.
  --Special Education Grants for Infants and Families.--NIEA supports 
        the $4.5 million request for Grants for Infants and Families 
        program. BIA schools receive 1.25 percent for distribution to 
        tribes and tribal organizations for the coordination of 
        assistance in the provision of early intervention services to 
        children aged birth to 2 years.
  --Rehabilitation Services.--NIEA supports the President's fiscal year 
        1999 request of $2.6 billion for Rehabilitation Services. The 
        Rehabilitation Service Grants Indians in the fiscal year 1999 
        budget is $17.2 million, a $1.9 million increase over fiscal 
        year 1998. Funds for this program are based on a 0.5 percent 
        set-aside. These critical dollars provide vocational 
        rehabilitation services to 7,000 American Indians with 
        disabilities living on reservations.
  --Education Technology.--The fiscal year 1999 request is $591 
        million, $50 million more than 1998 and includes a Technology 
        Literacy Challenge fund, Technology Innovation Challenge 
        Grants, and Leadership Activities. An additional $87 million 
        goes for three new national programs: teacher training in 
        technology, community-based technology centers, and technology 
        leadership activities. American Indians are estimated to 
        benefit with approximately $2.3 million in Technology Literacy 
        Challenge funds in fiscal year 1999.
  --Alaska Native Education Equity.--NIEA supports the fiscal year 1999 
        request of $8 million, the same as the previous two fiscal 
        years. The Alaska Native Education Equity program funding 
        request provides funding for continuation of projects that 
        address the barriers preventing Alaska Native students from 
        achieving to higher academic standards.
  --Vocational and Adult Education.--The fiscal year 1999 request for 
        Vocational Education is $1.1 billion, a $3 million increase 
        over 1998. Under this program American Indians previously 
        received funding under two programs the Indian and Hawaiian 
        Native set-aside and the Tribally Controlled Postsecondary 
        Vocational Institutions. The fiscal year 1999 request 
        eliminates funding under the Tribally Controlled Postsecondary 
        Vocational Institutions program, which was funded at $3.1 
        million in 1998, and moves it to the Indian and Native 
        Hawaiians set-aside. Funding for the Indian and Native 
        Hawaiians set-aside in the fiscal year 1999 request is $20.1 
        million, $4.5 million more than in 1998 (Tribally Controlled 
        Postsecondary Institutions would receive $3.1 million in the 
        1999 request).
  --Reauthorization of the Higher Education Act.--The reauthorization 
        of the Higher Education Act, as proposed by the Department and 
        passed by the House Committee on Education and the Workforce, 
        includes a new addition to Title III, Aid for Institutional 
        Development called the Strengthening Tribal Colleges and 
        Universities (TCU) Program. This new initiative would create an 
        institutional aid program designed to improve, strengthen and 
        expand the institution's capacity to serve American Indians and 
        other low-income students. The fiscal year 1999 request for 
        this program is $5 million which NIEA supports. The following 
        are some of the proposed sections of the Higher Education Act 
        reauthorization which NIEA fully supports:
    --Title IV.--Under Title IV, the TRIO program will remain virtually 
            the same except for minor administrative changes. The 
            fiscal year 1999 request is $583 million, $53 million more 
            than in fiscal year 1998. The TRIO program benefits 
            approximately 7,900 American Indian and Alaska Native 
            students at an estimated $6.3 million in fiscal year 1999.
    --Title V.--Under Title V, the Administration proposes to focus 
            resources on recruitment of new teachers for high poverty 
            urban and rural areas, preparing them well, and supporting 
            them during induction, the critical stage of a teacher's 
            career. American Indian and other minority serving 
            institutions with teacher training programs would be given 
            priority during the application process. Title V is 
            currently funded at $2.2 million while the fiscal year 1999 
            request is $67 million, a substantial increase for teacher 
            preparation.
                department of health and human services
III. Administration for Children and Families
  --Head Start.--NIEA supports the fiscal year 1999 budget request of 
        $134.5 million for programs for American Indian children. This 
        request is a $10 million increase over fiscal year 1998 and is 
        needed in Indian Country. The Head Start Bureau estimates that 
        over 21,000 American Indian children will benefit from the 
        services provided by this program. Currently there are 130 
        Indian Head Start programs serving Indian communities.
  --The Head Start Act is being reauthorized in 1998 and NIEA 
        anticipates the need for few major changes to the program as it 
        affects American Indians. NIEA is concerned, however that 
        regulations regarding consultation with Indian Tribes are still 
        going through the clearance process at the Department of Health 
        and Human Services. The latest consultation requirement went 
        into affect after the last reauthorization in 1994. NIEA 
        requests that this be completed and made available to Indian 
        Country as soon as possible.
IV. Indian Health Service
  --Indian Health Professions Scholarships.--NIEA supports a funding 
        level of $30 million, $1.3 million more than the $28.7 million 
        requested for Indian Health Professions in fiscal year 1998. 
        There has been no significant increase in this program since 
        fiscal year 1996. The need for health professionals in Indian 
        Country has far exceeded the available funding for American 
        Indians. The Indian Health Professions is authorized by Public 
        Law 94-437, the Indian Health Care Improvement Act (IHCIA). 
        NIEA supports an increased appropriation to meet the rate of 
        inflation and the higher costs of training for health-related 
        fields that increase in cost annually.
III. Other DHHS Indian Education-Related Programs
  --Administration for Native Americans (ANA).--NIEA requests a funding 
        level of $38 million for ANA programs, an increase of $3.1 
        million over fiscal year 1998. ANA provides funding for tribes 
        and non-profit Indian organizations to develop economic 
        development, environmental management, and language retention 
        and preservations projects. NIEA anticipates approximately $2 
        million going toward language preservation grants, which is 
        $200,000 more than in 1998. NIEA supports the Native Language 
        Act of 1992 which authorized a funding level of $2 million in 
        fiscal year 1993. This provision, however, has never been 
        appropriated. Funds have come instead through ANA.
  --Child Care Development Block Grant (CCDBG).--NIEA supports the 
        fiscal year 1999 request of $5.1 billion for child care 
        activities. Included in this request are funds for child care 
        entitlements (Mandatory Funds), and Discretionary Funds (the 
        former CCDBG). Tribes receive a 2 percent set-aside of these 
        funds. Included in the $5.1 billion request are funds to 
        implement the President's Child Care Initiative which would 
        support an Early Learning Fund, a Standards Enforcement Fund, a 
        Child Care Provider Scholarship Fund, and a Research and 
        Evaluation Fund. In fiscal year 1998, 243 tribal grantees were 
        awarded over $61 million in Child Care and Development Fund 
        (CCDF) grant funds. Through consortia arrangements, CCDF tribal 
        grants may serve over 500 federally-recognized Indian Tribes 
        and Alaska Native Villages.
                                 ______
                                 
Prepared Statement of Stephen A. Janger, President, Close Up Foundation
    Mr. Chairman, distinguished members of this subcommittee, my name 
is Stephen A. Janger and I am President of the Close Up Foundation. I 
appreciate the opportunity to submit this testimony in support of the 
Allen J. Ellender Fellowship Program administered by the Close Up 
Foundation. Please allow me to begin by expressing the sincere thanks 
of all of us at the Foundation for this Subcommittee's past support. 
Your support has enabled tens of thousands of participants to take part 
in our citizenship education programs.
    From most accounts, today's economy is robust, unemployment rates 
are low, interest rates are low. There is another rate that is low, 
however, that is disturbing to those of us concerned with civic 
education. Shortly, I will discuss in more detail the recently released 
UCLA survey of the values and attitudes of college freshmen, but 
suffice it to say that the survey results demonstrate that young people 
entering college today are more apathetic toward politics than anytime 
in the history of the survey. This apathy coupled with other signs of 
disengagement are some of the reasons we at Close Up believe it is a 
critical time to address and correct the ``whatever'' attitudes of 
today's youth. Our program can help. We have spent more than 27 years 
working to educate young people about their citizenship 
responsibilities. For these and other reasons, we believe there is a 
critical need for our program and we respectfully request $3.0 million 
for fiscal year 1999.
    I do not have to remind any of you that every day the news media 
are filled with stories about various reports or studies that contain 
information and statistics that are negative and troubling. In January, 
one of those studies was reported in media across the country. It 
caught our attention immediately because it is so relevant to the work 
Close Up has been doing for 27 years.
    The results of a survey conducted by the Higher Education Research 
Institute at UCLA's Graduate School of Education and Information 
Studies are contained in a book entitled The American Freshman: 
National Norms for Fall 1997. The statistically-adjusted results of the 
252,082 responses from college freshmen reveal record levels of 
academic and political disengagement. The response to the question of 
the importance of ``keeping up to date with political affairs'' was an 
all time low (26.7 percent) for the 32 year old annual survey. Upon 
reading this disturbing survey, I wrote to all of you to express my 
concern and to remind you that Close Up, with its commitment to 
educating students to be informed, responsible citizens, continues to 
be part of a solution for this problem.
    From its inception, Close Up has had as a primary focus teaching, 
in a hands-on way, that informed, active citizenship is the 
responsibility of all Americans. Citizenship participation is a 
significant part of what made America strong, and it is an essential 
part of what will help America continue and endure. The results of the 
survey hopefully should awaken the country to the need to focus on 
trying to find ways to successfully address this problem. As a nation, 
we must heed the warning, and meet the challenge because the strength 
of our democracy lies in the civic well-being of our country.
    The Close Up Foundation's programs are designed to combat the 
political apathy expressed by today's college freshmen. Obviously, we 
do not believe our program alone can correct the entire problem, 
particularly since our funding has been reduced by 64 percent since 
fiscal year 1994. We do believe, however, that our program can help to 
reverse the trends evidenced in the survey; and, that with an increase 
in Ellender Fellowship funding and a corresponding commitment to 
generate private sector support, we can reach a greater number of the 
students who need this kind of program the most.
    Close Up has participants from all 50 States, the District of 
Columbia, Puerto Rico, and the Pacific Trust Territories. We work hard 
to ensure that ``all kinds of kids'' take part in our programs. There 
are students who are academically gifted and students who struggle in 
school; there are students from urban, rural, and suburban areas, from 
large and small communities; there are students who are visually-
impaired, hearing impaired, or orthopedically-challenged; there are 
students from all economic and cultural backgrounds. All of these 
diverse, wonderful young people are ``mixed'' together on various 
activities in Close Up's program and the results are an eye-opening 
realization that they are not as different as they thought they were at 
the beginning of the week. They also realize that they share a common 
bond, they are all citizens of the United States with the same rights 
and responsibilities. Diversity is not America's biggest problem, it is 
our strongest asset.
    The Ellender Fellowships are in large measure the vital key that 
makes this possible. With the Ellender Fellowships, Close Up can reach 
the most underserved student constituencies in America. We can provide 
fellowship assistance to economically needy students and allow them to 
work alongside their peers. We enable students who are recent 
immigrants to the United States and students whose parents are migrant 
workers to take part in our Program for New Americans. This encourages 
some of our newest citizens to work and learn with students from very 
different backgrounds.
    Although most Close Up programs are primarily focused on students, 
we also are involved with educators. The Administration and several 
Members of Congress, from both sides of the aisle, have spoken of the 
need to increase the number of teachers and the quality of teaching in 
America. A primary objective of increasing the number of teachers is to 
reduce the student teacher ratios in classrooms. We believe that the 
Close Up experience serves to stimulate young people to enter the 
teaching profession. Even more importantly, our teacher professional 
development program significantly increases teacher retention. 
According to one principal, ``Close Up is the strongest antidote to 
teacher burnout that I know.''
    Close Up is unique from other civic education organizations with 
its teacher professional development program. While the students are in 
Washington on their program, a separate program is conducted for 
teachers. This teacher program exposes educators to new teaching ideas 
and information presented by Close Up's trained professional staff. 
Teachers in this program also gain invaluable insights from their 
peers. Educators from across the country ``swap'' ideas and experiences 
building greater resources for all of the teachers benefiting from the 
program. Many veteran educators report that, ``* * * participating in 
Close Up is the most important inservice experience of my career.''
    Through this teacher program, civic educators are reinvigorated and 
return to the classroom to inspire students to be good citizens and 
exercise the responsibilities of citizenship. An enthusiastic teacher 
may be the best tool to turn around the trend toward disengagement. 
Close Up and the Ellender Fellowships can not possibly reach all of the 
students we need to, but one teacher can reach 125 students or more 
each year. With an invigorated teacher as the messenger, high school 
students can begin to learn early the lessons of the importance of 
taking responsibility for their life-long civic literacy.
    Close Up's teachers and students make other contributions to their 
communities. A significant number of reinvigorated Close Up teachers 
return to their communities and organize Close Up Local Programs. These 
local programs are civic education activities that focus on local or 
statewide governmental entities, or important policy issues facing the 
communities. Approximately 40,000 people take part annually in an 
estimated 120 local programs. All of this is done at no cost to the 
federal government. I am very proud of these activities, and I think 
they demonstrate the effectiveness of Close Up's program and message 
more than my words could ever express.
    It is disappointing that Close Up's effectiveness and uniqueness 
seem not to be understood by the Department of Education. The 
Department of Education's (DEd) fiscal year 1999 budget justification 
materials include the same erroneous rationale for eliminating the 
Ellender Fellowship program that was presented as last year's 
justification. The Congress obviously did not accept the DEd's 
rationale last year, and nothing has changed to make that rationale any 
more acceptable this year.
    As we stated in last year's testimony, Close Up and the Ellender 
Fellowship program are very distinct from other civic education 
organizations. Attempts to compare Close Up's fellowship program with 
those of other civic education organizations are not legitimate. Even 
with our drastically reduced funding, using an effective multiplier we 
have been able to provide more fellowships in any one year than some of 
these organizations have total participants.
    More importantly, Ellender and Close Up fellowships are awarded 
solely on the basis of economic need. It is my understanding that other 
civic education organizations occasionally offer fellowships but in a 
very limited number. To receive a fellowship, however, the applicants 
are required to submit a written essay and compete for the fellowship. 
This can be an intimidating task for many students, and discourages 
students from applying for fellowships, precluding the participation of 
numerous students.
    Additionally, I understand that some of the fellowships awarded by 
other organizations are designated for certain geographic areas. This 
prerequisite further limits the availability of fellowship assistance 
to students. At Close Up, we have been fortunate to receive donations 
from various private sources. Sometimes these donors place various 
restrictions on their contributions. In this vein, I can appreciate the 
limitations this imposes on an organization, and it is one of the 
reasons that the Ellender Fellowships are so critically important to 
Close Up's work. With the Ellender Fellowships, we can help students 
regardless of where a student lives or what their current abilities are 
with respect to essay writing or test taking.
    Again this year, the DEd's budget justification includes a 
reference to the Department's belief that the Foundation's development 
efforts, especially the new alumni/ae program, will enable the 
Foundation to continue the Ellender Fellowship activities without 
federal funds. At the risk of being repetitive, I will reiterate what 
we said last year. Alumni/ae development programs do not generate a 
sustainable, substantial revenue stream for major universities or other 
non-profit organizations. It is very unlikely, despite our enthusiastic 
alumni/ae, that Close Up could expect to receive major gains from its 
fledgling alumni/ae program. Furthermore, Close Up's alumni/ae are a 
very young group of individuals. Our oldest alumni/ae are just now 
reaching their late forties. The vast bulk of our alumni/ae are young 
people who are just starting out in life and have heavy demands placed 
on limited financial resources. We are committed to continuing our 
alumni/ae program. We already have enjoyed promising results from 
finding old friends and developing new friends. The results, however, 
do not support the DEd's contention that the alumni/ae program will 
produce financial support sufficient to replace federal funding.
    Close Up has worked hard to bring its citizenship lessons to young 
people. During the 1998-99 program year, Close Up will hit a noteworthy 
milestone. We will have had more than 500,000 participants in our 
programs. This is an important accomplishment, but more than the number 
of participants we are encouraged by the contributions our program and 
its participants make to the civic literacy of our country.
    We hear reports all the time about Close Up participants who become 
engaged in the processes of good government. They return to school and 
become involved there as well as in their communities. Students return 
home and speak with their parents and family members about things like 
the importance of voting, or community service. The interest does not 
stop in the schools and homes, it continues with them to all aspects of 
their lives. Former Close Up participants are in all walks of life, but 
a recent Close Up alumni/ae search found a significant number of former 
participants working on Capitol Hill, in the federal government, in 
state and local government, and in numerous social service or policy 
organizations.
    Fortunately, Close Up participants seem not to share the apathy of 
current college freshmen. Our evidence points to the fact that Close 
Up's program and its message are effective and working. This is a 
central reason why we believe Ellender Fellowship funding should be 
increased to allow more young people with limited economic means to 
have the same opportunity for civic enrichment that their more affluent 
peers enjoy. Providing equality of opportunity is one of the most 
beneficial and respected historic roles of the federal government. 
There are few more important educational areas where this needs to be 
done than in citizenship education. The Ellender Fellowships are a 
highly effective seed element creating widespread educational and 
private sector partnerships that benefit the individual, the community 
and the country.
    Mr. Chairman, I would like to conclude by again thanking you and 
the members of this Subcommittee for your past support. As I believe I 
have demonstrated, the Ellender Fellowship funding provided by this 
Subcommittee is an integral part of Close Up's success in reaching 
thousands of students who would not be able to participate without 
fellowship assistance. In this time of increasing disengagement by 
America's youth, this relatively small amount of federal funding can be 
multiplied many times over to reach students who can help to change the 
direction of political apathy.
    I will be glad to answer any questions or to provide any 
information. Thank you very much.
                                 ______
                                 
Prepared Statement of C.M. Sgt. James E. Lokovic, USAF (Ret.) Director, 
   Military and Government Relations, Air Force Sergeants Association
    Mr. Chairman and distinguished committee members, on behalf of the 
members of the Air Force Sergeants Association (AFSA), thank you for 
this opportunity to discuss the Department of Education's (DOE) fiscal 
year 1999 budget. Within the DOE appropriations is a funding item of 
critical importance to the quality of the lives of military members and 
their families. Today I ask you to once again consider and, this year, 
to fully fund Impact Aid in support of the children of the military men 
and women serving our nation. AFSA's primary mission is to promote and 
protect the quality of the lives of all active and retired enlisted Air 
Force members (active duty and reserve component) and their family 
members and survivors.
    Impact Aid is an important program for the military families we 
represent, as it ``zeroes in'' on the quality of the educational 
programs provided to their children. AFSA believes that full Impact Aid 
funding rightfully falls within the purview of this committee and the 
Department of Education. Impact Aid is not a ``defense'' program but, 
rather, a national program whereby the federal government reassigns 
these federal workers and their families from location to location 
then, rightfully, supplements local communities affected by their 
presence.
Background
    Just how are local school districts impacted, and to whom does 
Impact Aid apply? These appropriations provide assistance to local 
school districts serving civil servants, Native American children, low 
rent housing, and, in 40 percent of the total appropriation, to school 
districts impacted by the presence of military children. It is on 
behalf of these military children that I speak today.
    Since the Truman Administration, our government has recognized that 
it alone is responsible for placing and relocating military families. 
It, therefore, has accepted an obligation to compensate local school 
districts which provide a public education to military children. In 
effect, Impact Aid compensates for an ``unfunded mandate.'' Impact Aid 
compensates for tax revenues (that fund local education) that are 
generally not paid by military members.
    For military children, funding is provided at two different levels; 
one level (3a) if the parents of a student live and work on federal 
property and another level (3b) when a parent works on federal property 
but lives in the community as a renter or homeowner. Local educational 
agencies receive $2,000 for each 3a student and $200 for each 3b 
student. Impact Aid is an excellent example of federal funds going 
directly to a program with little bureaucratic red tape. The funds go 
directly to schools to serve the education of military children, and 
local boards of education decide how it is to be spent.
    Certainly, the children of military members lead a unique life, 
fraught with challenges unlike those faced by most of the rest of this 
nation's youth. They typically change schools often, repeatedly being 
uprooted and having to readjust to new communities and friends. One 
very necessary annual budget action has been to recognize these young 
men and women by providing funding through Impact Aid to the local 
school districts which educate them. This federally funded program 
provides for the education of military children in grades K through 12.
    Interestingly, for these children, the return to our government 
goes beyond the normal focus on an educated citizenry. They are unique 
in that approximately 50 percent of current active duty personnel grew 
up in military families. In that sense, Impact Aid directly affects the 
quality of our nation's future military leaders.
    The all-volunteer force has had a dramatic impact on the new 
military and its demographics. More personnel (approximately 60 
percent) are married. Approximately 65 percent of military spouses are 
employed, especially within enlisted families. There are more single 
parents in our military today. There has been a steady increase in the 
number of military pre-school age children. Active duty personnel have 
about one million children younger than 12 years of age.
    Today, there are increasing pressures and anxieties for military 
families caused by a number of factors, including a significantly 
intensified operations tempo and the uncertainty of downsizing, 
privatization, and outsourcing. Deployment rates have been very high as 
our military's mission has transitioned to ``peacekeeping'' around the 
globe, and military parents must be prepared to deploy rapidly. With 
all of the other challenges of military life, it is important that, at 
the least, we are committed to provide a quality education for military 
children. It is a high priority for military families, and it is a 
readiness and a quality-of-life issue. As our military personnel are 
deployed, they should not have to worry about whether their children 
are receiving a quality education.
          why military children need the support of impact aid
    In recent years, some districts with a large number of military 
children have found there is inadequate educational funding, which has 
required higher property tax rates (which generally fund local school 
systems). Clearly, localities, should not be punished because of the 
location of a federal facility. The administration, which ultimately 
assigns these families, has an obligation to support them. Accordingly, 
it is gratifying that this committee has stepped up to examine Impact 
Aid as part of the ongoing congressional and administration discussions 
on nationwide educational funding and expansion. The children of our 
military members must be considered in these plans. Impact Aid is the 
most proper way to reflect the need to protect their (and local 
community) interests.
    Another potential problem would loom if Impact Aid were not fully 
funded. As this committee knows, there have been attempts in the past 
to charge``enrollment fees'' to the parents of military children. 
Military parents expect that the federal government will act in the 
best interests of their families. If any group of the nation's families 
should earn an extra measure of governmental support, it should be 
those who serve our nation and are transferred at the pleasure of the 
government. However, we fear that continued diminishment of the program 
will result in other attempts by communities to charge fees to make up 
for educational funding shortfalls. It would be wrong to penalize 
military families simply because the government stations the family at 
a particular location.
    The problem could become more severe. As the military proceeds with 
the privatization of military housing, and if that housing is not 
considered ``federal property,'' then students would be classified as 
3b students, providing only $200 per student to the local education 
authorities. This could create tensions between the residents of 
heavily affected communities and military facilities in those 
communities. Area civilians could reasonably question why their 
children's education must suffer. This is an area that requires careful 
congressional observation. The options are to fully fund and continue 
this important aid, or to underfund it (as has recently been done), 
hoping that Congress will remedy the situation.
    During each of the past few years, the administration and the 
Office of Management and Budget have recommended deep cuts in the 
Impact Aid program and substantial increases in ``nice to have'' 
programs such as Goals 2000 and college incentives for ``other than 
military service.'' Why is the basic education of military children 
such a low priority? If our military children don't receive the quality 
education they need in elementary and high schools, we won't have to 
worry much about college incentives.
    As funding for school districts that serve military children has 
been reduced, one of the first areas that has been affected is new 
construction and upkeep of the school buildings. Continual cutting of 
this program has had a tremendous impact on the local schools. Also, 
due to the drawdown, some schools have experienced substantial 
increases in students and are having a difficult time accommodating the 
growth. Many of the school facilities used by military children are 
nearing a half century in use and today are in need of repair, ADA 
accessibility, asbestos removal, etc. The aging facilities and shortage 
of upkeep and maintenance has put many of the schools in dire need of 
attention.
    In light of the cost of education and the absolute propriety of 
fully funding Impact Aid, what has been our government's track record? 
During the past 17 years, while the number of students served through 
Impact Aid has remained the same and the Consumer Price Index has 
increased by 70 percent, Impact Aid funding has remained level. In 
fiscal year 1998, the program received a 10 percent increase. This was 
definitely a step in the right direction. The fiscal year 1999 
appropriation needs to continue to strive to meet the funding levels. 
Without question, full funding for Impact Aid would greatly assist in 
ensuring the children of our military personnel a quality education 
without endangering or compromising the budgets of local school 
districts.
                              the request
    Mr. Chairman, we believe the obligation is clear: the federal 
government must pay its tax bill to school districts for the education 
of military children. Originally instituted in 1950 and fully funded 
until 1970, Impact Aid is now funded at approximately 40 percent of the 
level originally intended. As we indicated, the result of such program 
proration has resulted in school districts facing many financial crisis 
and the prospect of possible closures.
    On behalf of those that AFSA represents, I recommend a modest, 10 
percent appropriation increase over last year. Based on the past few 
years, we expect that the Department of Defense (DOD) may once again 
find itself forced to supplement the Impact Aid parsed out by the 
Department of Education for more seriously impacted, high-need 
districts. This should not be the case; but in the past DOE funding 
shortfalls have forced the issue. If you repeat 1998's 10 percent 
increase, this committee would recommend an Impact Aid appropriation of 
$889 Million. However, if this committee is prepared to embrace the 
obligation to fully fund the need with education dollars (rather than 
requiring a DOD supplement), we would request that the full 
appropriation be $939 Million. Those that have tracked Impact Aid since 
the 1950s and the escalating costs of education have indicated that 
this figure will fairly supplement local school districts for 
situations created by the federal government.
    AFSA contends that the time has come to set an automatic funding 
mechanism in place to avoid having to revisit this issue each year. A 
look at the history of Impact Aid appropriations shows a remarkable 
disparity between overall DOE spending and Impact Aid appropriations. 
Since 1950, the overall DOE budget has increased at a factor of more 
than 94 times; during the same period, Impact Aid appropriations have 
increased at a minor fraction of that. The simple, yet important, 
questions we need to consider in determining the right thing to do are 
these: ``Do we, as a nation, commit to assisting local school districts 
who educate the children of our military?'' ``If so, can we arrive at a 
level of spending that results in quality education without endangering 
local budgets?'' And finally, ``Do we accept that in stationing a 
military family there, our government also incurs an incontestable 
obligation to supplement local school districts for each student so 
educated?'' If so, we urge this Congress to arrive at an annually 
applied formula, using $939 Million as a baseline, which would become 
an automatic part of every affected appropriations budget. We urge you 
to make the education of military children a national priority.
    Mr. Chairman, we understand the difficult budget choices that you 
and this committee face. However, we believe that the education of 
military children should not suffer because their families are moved at 
the convenience and desire of the federal government. Military children 
should be held in the same high spending priority that this nation 
affords any other of its children. We urge this Congress to direct the 
Department of Education to request full funding for Impact Aid. Mr. 
Chairman, again I thank you for this opportunity to represent the views 
of enlisted members and their families on this issue. As always, the 
Air Force Sergeants Association is ready to support you in matters of 
mutual concern.
                                 ______
                                 
          Prepared Statement of American Council on Education
    Mr. Chairman and members of the subcommittee: The American Council 
on Education is the nation's principal body representing all sectors of 
postsecondary education, including 1,800 two-year and four-year member 
colleges, universities, and education associations. We share with you 
the perspectives of 27 higher education organizations on the fiscal 
year 1999 appropriations for the Departments of Labor, Health and Human 
Services, and Education. Together, these associations represent the 
3,700 colleges and universities across the nation that provide the 
teaching, research, and service essential to our economic and social 
well-being, as well as the students who attend them.
    We begin by expressing our profound appreciation for the priority 
and support that members of this Subcommittee have shown for higher 
education, and especially for your support last year. We know well the 
constraints you face in the non-defense discretionary budget this year, 
but urge you to give a high priority to expanded investment to help 
individuals develop their talents to the fullest and gain access to the 
many options available in higher education. We continue to have a 
concern for those at the lowest income levels. The support provided 
through need-based student assistance programs helps to ensure that 
higher education will remain available to all. In the world in which we 
live, learning throughout life has become the most crucial element in 
the diverse fabric of American social and economic life and in the 
advancement of hope and opportunity for all Americans.
    We especially thank this Subcommittee for last year's 
appropriations bill. You increased federal support for both student aid 
and biomedical research. The purposeful investments you made last year 
will pay dividends for decades to come. In particular, we commend the 
Subcommittee for increasing the Pell Grant maximum award to $3,000 and 
expanding access to Pell Grants for approximately 220,000 needy 
students, for increased support for the Supplemental Educational 
Opportunity Grant (SEOG) program, for maintaining support for the 
Federal Work-Study (FWS) and Perkins Loan programs, as well as 
increases in the TRIO program. At the same time, you also sharply 
increased funding for biomedical research through the National 
Institutes of Health (NIH).
    Turning to fiscal year 1999 appropriations, we will focus 
predominantly on the matter of federal student financial assistance. 
The first session of the 105th Congress was one of the most creative 
and productive legislative sessions in history with regard to higher 
education policy. The importance of postsecondary education was 
evidenced by the increase in Pell Grant funding, as well as the nearly 
$40 billion in education-related tax cuts approved by the Congress. 
This effort is expected to continue as Congress completes action to 
reauthorize the Higher Education Act of 1965.
    This Subcommittee will likely play an increasingly important and 
prominent role in developing good public policy, and ensuring that the 
interests of students and the nation are served well and effectively. 
Here are three reasons why we believe this to be the case:
    1. Without regular increases in the Pell Grant and other forms of 
student grant assistance the gap in college attendance rates between 
low-income students and other more advantaged peers will continue to 
grow and crucial talent will be lost to the nation. While federal 
student aid has boosted the attendance rate of students from the 
lowest-income quartile from 45 percent in 1979 to 58 percent in 1994, 
the college attendance rate for high-income students has grown from 67 
to 88 percent over the same period. In short, the gap has widened. 
Further steady increases in the Pell Grant maximum are necessary to 
avoid a situation in which family wealth determines who can attend 
college. We must bring the attendance rates of low-income students in 
line with those of higher-income students and remove the financial 
barriers blocking access to college. The actions taken by this 
Subcommittee are critically important.
    2. Current borrowing trends among students demonstrate clearly that 
students need to be given viable alternatives to debt financing as the 
primary means of paying for college. In 1979, Pell Grants comprised 76 
percent of all federal funding for student aid, whereas today loans 
account for 72 percent. The maximum Pell Grant has fallen 26 percent in 
constant dollars since 1978. In other words, adjusted for inflation, 
the maximum award is worth only 74 percent of what it was in 1978. To 
restore the value of the 1978 Pell Grant maximum in current dollars, 
the maximum award today would need to be set at $4,050.
    The value of the campus-based student aid programs has fared even 
worse over time. After adjusting for inflation, between fiscal year 
1980 and fiscal year 1998, funding for the SEOG declined 17 percent; 
FWS dropped 25 percent; new capital contributions in the Perkins Loan 
program fell 76 percent; and State Student Incentive Grants (SSIG) 
tumbled 88 percent.
    As the purchasing power of federal grants has declined, low- and 
middle-income students have found themselves facing an increasingly 
limited range of choices among institutions. Many low- and middle-
income students continue to go to college, but they have had to bear 
the brunt of escalating indebtedness. Reducing the extent to which 
these students must borrow is not merely desirable education policy, it 
is sound national economic policy. It is this group of students for 
whom the highest returns on the federal dollar would be realized. The 
most effective remedy for lessening reliance on loans is a restoration 
of the value of federal grant assistance, a journey on which this 
Subcommittee began in fiscal year 1998. We urge you to continue that 
progress in fiscal year 1999.
    3. Increased federal grant assistance will also help campuses 
reduce the pressures that increase college tuition. We share the 
serious concern members of this Subcommittee have with respect to 
college costs and prices and the rise in tuition charges over the last 
decade. In recent years, the rate of increase has declined 
significantly, but reducing the strain on institutional student aid 
budgets through the provision of adequate federal student aid will help 
greatly. Every college and university president in the country is 
searching for ways to contain college costs. Federal student aid helps 
in that important task. As the National Commission on the Cost of 
Higher Education noted, abundant evidence supports the assertion that 
the availability of student aid helps hold down the cost of college.
    Data show that when federal student aid increases rapidly, tuition 
rises at a more modest rate than it does when student aid grows slowly. 
Indeed, in the 1990s, we have seen a significant moderation in the rate 
of increase in college tuition as federal student aid has grown.
    In light of these considerations, the role of the members of the 
appropriations committees is more critical than ever. The issue is not 
merely the appropriation of funds, but, more importantly, the 
attainment of effective national public policy outcomes. Toward this 
goal, the higher education community respectfully submits the following 
recommendations for your consideration:
  --We urge the Subcommittee to continue its strong support for the 
        Pell Grant program. We are deeply grateful for the significant 
        increase in the maximum grant in fiscal year 1998, which will 
        help the neediest individuals aspiring to attend college. The 
        Administration has proposed a $100 increase in the Pell Grant 
        maximum in its fiscal year 1999 budget request. We urge the 
        Subcommittee to take stronger measures to restore the lost 
        purchasing power of the Pell Grant and provide a larger 
        maximum. The current maximum award is still far below the 
        authorized level, and remains insufficient to help those 
        students with the greatest need, and to prevent students from 
        accruing significant levels of debt.
  --We urge you to provide a $70 million increase for the SEOG program, 
        which would bring about the $100 increase proposed in 1996 by 
        Senators Loft and Specter. SEOG funding is directed toward the 
        most financially needy students, and until last year's modest 
        $30 million increase, this program had been level-funded since 
        fiscal year 1992. While this program appears to Congress to be 
        a small one, to the most needy students, SEOG can be highly 
        significant since it carries an allowable maximum grant of 
        $4,000.
  --In accordance with what was included in the President's budget 
        request, we urge you to increase funding for the Federal Work-
        Study program by $70 million to a total of $900 million.
  --We urge you to continue the federal capital contribution to the 
        Perkins Loan program at least at the fiscal year 1998 level of 
        $135 million. By virtue of the low interest rates the Perkins 
        Loan offers, this program provides less expensive loans to 
        students with great levels of financial need. The 
        Administration proposed a reduction in the Perkins capital 
        contributions and we think this was a significant mistake.
  --We support the continuation of the institutional-state-federal 
        partnership in student financial assistance. We understand that 
        this Subcommittee has raised concerns with the current SSIG 
        program and we have heard these concerns. The authorizing 
        committees are considering a new partnership program that will 
        continue to use modest federal funds to leverage additional 
        state student aid dollars. We understand that their proposal 
        may call for an increased effort on the part of states in order 
        to receive new money and will incorporate priorities of Members 
        of Congress. The state role in the shared responsibility for 
        higher education is very important. We urge you to provide at 
        least $50 million for this new state partnership program.
  --We urge the Subcommittee to provide sufficient funding in fiscal 
        year 1999 for the Graduate Assistance in Areas of National Need 
        (GAANN) and Javits fellowship programs to ensure that both new 
        and continuing fellows can be supported. We appreciate the 
        Subcommittee continuing to fund GAANN and Javits as distinct 
        and complementary graduate programs funded within the GAANN 
        account. The Title IX graduate education programs in your 
        Subcommittee's jurisdiction are a critical source of federal 
        financial assistance for academically superior students with 
        high levels of financial need. In addition, they are the only 
        significant source of graduate support in many academic 
        disciplines.
  --We support an increase for each of the component parts of Title 
        III, including Strengthening Historically Black Institutions, 
        both for the undergraduate institutions and the graduate 
        programs in Section 326, which address the underrepresentation 
        of African Americans in the health, scientific, and legal 
        professions; Hispanic-Serving Institutions; and Endowment 
        Challenge Grants. In addition, we recommend that the 
        Subcommittee increase funding for the Strengthening 
        Institutions program. These funds support a highly competitive 
        program of assistance that helps developing institutions with 
        large populations of low-income and ethnically diverse students 
        improve the quality of their programs and services.
    In conclusion, we thank the Subcommittee for your support of 
student aid and biomedical research in the past. The work of this 
Subcommittee affects the lives of all Americans, and especially those 
of low- and middle-income college students. Your support is essential 
if these students are to have the opportunity to develop their human 
potential in the years ahead and if our nation is to continue to 
prosper. We thank you for this opportunity to share the views of the 
higher education community.
                                 ______
                                 
  Prepared Statement of Crystal J. Paulk, on Behalf of the Society of 
                        Professional Journalists
                          campus crime issues
    Mr. Chairman and members of the Committee, I appreciate the 
opportunity to talk with you about public access to crime records and 
campus judicial hearings. My name is Crystal Paulk. I am a recent 
graduate of the University of Georgia and worked at The Red and Black 
student newspaper when the university's judicial system was both closed 
and later opened as a result of legal action.
    In recent years, Congress has shown a willingness to protect 
students when it passed the Student Right to Know and Campus Security 
Act of 1990. Congress later amended the Higher Education Act in 1992 to 
make clear that law enforcement records on college campuses are not 
beyond public scrutiny.
    But this is not enough.
    The U.S. Department of Education continues to allow schools to use 
the Family Education Rights and Privacy Act (FERPA) and its Buckley 
Amendment to deny access to criminal information within the campus 
disciplinary system. Thorough information about crimes on campuses is 
not available at most schools. With passage of the Accuracy in Campus 
Crime Reporting Act of 1997 (H.R.715), the public will be fully 
informed about the safety records of private and public campuses across 
this country.
    The Society of Professional Journalists, represented by 14,000 
members nationwide, feels strongly that it is the public's right to 
know information about such serious crimes on campus as rape, homicide 
and arson. Government should protect and promote the free flow of 
information. Without thorough and accurate crime information and the 
ability to report on closed disciplinary hearings, we all lose.
    University communities are served by police forces and court 
systems that are not subject to public scrutiny. That's contrary to the 
way law enforcement and court systems operate. Government officials 
cannot filter or suppress documents or prohibit public access to 
criminal judicial hearings. But on campuses across the country, secret 
proceedings are the rule rather than the exception.
    Today, campuses are experiencing increased incidents of serious 
crimes.
  --Researchers at Cornell University and Southern Illinois recently 
        reported that nearly one million college students may be 
        carrying weapons
  --Three students at the University of Cincinnati were recently 
        charged with starting a dorm fire that led to the evacuation of 
        700 students. That single crime could cost the university 
        $200,000.
  --The University of Pennsylvania significantly increased its security 
        measures after a rash of crimes that included 24 robberies in 
        one month--twice the number for that month the previous year. A 
        research associate was stabbed to death and a student was shot 
        and wounded as he fled a holdup. Many students complained the 
        precautions came too late.
  --At Troy State University in Alabama, 13 students were arrested on 
        various drug charges in April of 1996, and several of them 
        lived in the same dormitory.
    Despite this climate at colleges and universities--large and small, 
rural and metropolitan, private and public--college administrators 
continue to under report crime and keep the public from accessing 
timely and accurate information. Worse yet, they hold closed hearings 
on incidents involving crimes and defend the process as ``educational'' 
and necessary.
    Why?
    The main reason appears to be image and enrollment. Keeping the 
publicity at a minimum by dealing with matters internally helps 
recruiting. Meanwhile, parents and students become victims when they 
believe a campus is safe when it really isn't.
    As a student, I became a member of SPJ and served as president of 
the University of Georgia campus chapter during the 1996-1997 school 
year. SPJ's members work in all media and include educators and 
students. One of the Society's key missions is to safeguard the 
public's right to records and access to meetings.
    I worked for three years at The Red and Black, an independent daily 
newspaper. I also have been employed by the Athens Daily News and 
Athens Banner Herald and The Gainesville Times. I am currently an 
intern with Quill, the Society's national magazine. My internship is 
devoted to working on Freedom of Information issues. I am a student 
representative for the Campus Courts Task Force, a coalition of all the 
major organizations representing professional and student journalists 
and journalism educators. The Society founded the Task Force in 1993. 
Its 13 members support increased public access to crime information and 
secret campus courts.
    My specific interest in this issue began during my freshman year at 
the University of Georgia when I began working for The Red and Black. 
The newspaper was successful in two cases that went before the Georgia 
Supreme Court in 1992 and 1993. The court granted access to 
disciplinary proceedings.
    The first case involved a fraternity hazing ritual of paddling that 
left a student bleeding so badly from his rectum that he required 
hospitalization. The paper sued the school after reporters were denied 
access to the university's disciplinary hearing. In ordering that the 
records of this proceeding be made public, the Georgia Supreme Court 
aptly summarized the public's right to know:
    We are mindful that openness in sensitive proceedings is sometimes 
unpleasant, difficult, and occasionally harmful. Nevertheless, the 
policy of this state is that the public's business must be open, not 
only to protect against potential abuse, but also to maintain the 
public's confidence intheir officials.
    Jennifer Baker, another student, and I were assigned to cover the 
student judiciary beat for The Red and Black. Each week, we published a 
``Judicial Watch'' which included information about hearings and 
decisions handed down during the week.
    Those first few months were very difficult. Fellow students serving 
as student justices and defender advocates were told to have no contact 
with me outside the hearings, making it difficult to thoroughly report 
criminal incidents.
    Posted notices of the hearings were also difficult to track because 
of a convoluted record-keeping system. On several occasions, I missed a 
class to attend a hearing only to discover the hearing had been 
canceled or moved to another room. A hearing might last 30 minutes or 
several hours. When I tried to speak to a student, that student was 
often told by a university official not to talk to me. At times, all I 
was seeking was the correct spelling of a name.
    Despite these barriers, we persisted in the pursuit of accurate 
information. Accused students understood their rights and the student 
body overall knew the university was informing the public of criminal 
activity.
    Unfortunately, our experience at the University of Georgia is 
unique. Whereas the students, faculty, staff and the general community 
at the University of Georgia could learn about the incidents of crime 
on campus--and the punishment meted out to criminal offenders--such is 
not the case throughout most of the nation. Instead, the vast majority 
of our nation's colleges and universities keep crime and its 
consequences hidden from public view. And despite previous efforts of 
the Congress to require that statistical information be publicly 
reported, the law as it currently stands falls woefully short in 
demanding that timely, thorough information about criminal information 
be made available.
    This veil of secrecy is particularly troubling with regard to 
university disciplinary proceedings of students accused of criminal 
misconduct. The primary obstacle to access to disciplinary records is 
the U.S. Department of Education's interpretation of the Buckley 
Amendment. The Department defines disciplinary records as ``education 
records'' under the Buckley Amendment. Accordingly, it has said schools 
cannot release disciplinary records even when criminal activity is 
involved. Although the Buckley Amendment does not prohibit open 
hearings, university administrators are using the Buckley Amendment to 
close records. Thus, the conflict becomes obvious.
    Frankly, the Society believes the Department of Education's 
definition of disciplinary records as ``educational records'' is wrong. 
Recognizing this problem, Secretary of Education Richard Riley wrote to 
this Committee during the 104th Congress to call attention to the fact 
that crime is an increasing problem in campuses, and stated that there 
is merit to arguments for public access for these disciplinary records. 
But Secretary Riley said that Congress, and not the Department, should 
make the necessary changes. H.R. 715 is the vehicle to make this 
change.
    The Society and the Campus Courts Task Force strongly support 
public access to a daily and thorough campus police log and access to 
campus judicial hearings and records when the incidents stem from 
criminal and other non-academic misconduct. Such records should include 
information about how students charged with criminal behavior are 
disciplined. We believe the definition of law enforcement records must 
include disciplinary records stemming from criminal activities.
    It is critical for Congress to change the definition of 
``educational records'' to mean records only dealing with the academic 
life of a student. The Student Press Law Center, which provides free 
legal help to student journalists, offers this definition: 
``transcripts, teacher recommendations, test scores and other academic 
or financial aid records kept by the school.''
    My experiences as a student journalist made me understand that 
public access is vital to students living in the campus community for 
three reasons: to ensure fairness, justice and public safety. Let me 
explain why.
    An accused student must be able to trust the judicial process.
    Every school handles its disciplinary procedures differently. This 
also can lead to inconsistent sanctions. At the University of Georgia, 
the hearings resemble court proceedings. A student accused of violating 
a university regulation is notified by the Student Judicial Office and 
represented in the hearing by a student defender.
    By tracking the system for The Red and Black, we discovered 
inconsistencies. The accused student had to choose between a formal 
hearing by peers or an informal hearing with an administrator. A 
student was seven times more likely to be suspended by his peers than 
by an administrator, a statistic that was reported in The Red and 
Black.
    During the next few months, the judicial process changed. All 
accused students appeared before one hearing panel of two student 
justices and an administrator. The changes were supported by faculty 
and students. This inconsistent justice could not have been documented 
without access to disciplinary hearings.
    There is no reason why campus crime and judicial proceedings should 
be treated differently than crime and courts off campus. Some recent 
examples are particularly troubling.
    The University of Maryland is fighting to keep student athlete 
parking tickets secret. The case began after the student newspaper, The 
Diamondback, heard that a university basketball player had accumulated 
more than $8,000 in unpaid parking tickets. They also heard that the 
player, in violation of National Collegiate Athletic Association rules, 
had obtained money from a former coach to pay the fines. The newspaper 
sought additional information under the state's open records law. But 
university officials turned down the request, citing FERPA. The 
Diamondback sued, and a Maryland court ordered the university to turn 
over the records. However, the case is on appeal and both the 
Department of Education and the NCAA have filed supporting briefs to 
overturn that decision.
    At Louisiana State University, a secret court was used to expel 
members of the student government who stole money from a campus book 
fair. The case was never prosecuted by the local authorities. LSU 
administrators informed the student body the book fair revenue had 
``evaporated,'' but never specified who was responsible or how much 
money was stolen. A tenacious editor of the campus newspaper found out 
what had happened by interviewing two expelled students who felt their 
punishment was too harsh. When the editor asked LSU administrators to 
comment on the reported $2,700 theft, they refused. The student 
newspaper and the Shreveport Professional Chapter of SPJ sued for the 
documents, but were unsuccessful. The court ruled in the university's 
favor. LSU never publicly disclosed how much money was stolen, who was 
involved or what actions were taken to punish the violators.
    Contrast the LSU example with a similar case I covered in March 
1994 at the University of Georgia. During an audit of the University 
Bookstore, missing funds were traced to three student cashiers. The 
theft totaled $4,251. But in this instance, the case went to court--a 
real court--where the students were sentenced to 12 months probation, 
community service, and required to provide restitution. The students 
also were brought before the student judiciary in an open hearing and 
suspended from school for one year.
    On both the LSU and Georgia campuses, students were outraged by 
these thefts. However, at the University of Georgia, where the case was 
handled openly, the public was officially informed justice had been 
served.
    Administrators must release information for students, their parents 
and the community at large to know if their campuses are safe.
    The Ohio Supreme Court recently recognized the necessity of open 
campus judicial records. In a July 9, 1997 ruling, the Court ordered 
Miami University to release detailed disciplinary records to the campus 
newspaper, The Miami Student. In words that resonate here, the Court 
wrote:
    ``Unfortunately, at present, crimes and other student misconduct 
are escalating at campuses across the nation. For potential students, 
and their parents, it is imperative that they are made aware of all 
campus crime statistics and other types of student misconduct in order 
to make an intelligent decision of which university to attend. 
Likewise, for students already enrolled in a university, their safety 
is of utmost importance. Without full public access to disciplinary 
proceeding records, that safety may be compromised.''
    The Society and the Campus Courts Task Force believe college and 
university crime reports are an inaccurate representation of campus 
crime. A story published in The Washington Post in April this year 
cites specific instances where violent student crimes were not included 
on official reports because the incidents occurred off campus. Crimes 
against these students are seldom included in a college's overall 
statistics that are reported annually to the U.S. Department of 
Education.
    Even when the Department of Education cites a college or university 
for breaking the reporting requirement on annual crime reports--
something it has managed to do only twice in seven years--campus 
administrators seem to view those federal citations as insignificant.
    In March 1997, the U.S. General Accounting Office reported on the 
difficulties that colleges have faced in meeting federal reporting 
requirements about campus crime. See U.S. General Accounting Office 
Report to Congressional Requesters, Campus Crime: Difficulties Meeting 
Federal Reporting Requirements, Report No. GAO/HEHS-97-52, March 1997. 
The GAO concluded that the Department of Education was ``slow'' in 
monitoring compliance with the reporting requirements and was late in 
issuing a report to Congress. The colleges faced problems as well. The 
GAO concluded that because colleges handle their data differently, it 
is difficult to compare one school to another. The GAO also noted that 
considerable confusion still exists among colleges about what and how 
they should report incidents of campus crime. For example, most of the 
colleges studied omitted hate crimes from their statistics, while 
others excluded crimes reported to local police.
    One of the most sensitive areas of concern when dealing with campus 
crime is sexual assault. Administrators say they fear victims of sexual 
assault may be reluctant to report the crime if hearings are open. 
Journalists usually do not disclose the identity of sexual assault 
victims even when covering open criminal trials. However, reporters may 
contact a victim. In those instances, a victim may choose to go public 
and deference is given to the victim to make that choice. The Society's 
Code of Ethics directs all journalists to ``show compassion for those 
who may be affected adversely by news coverage'' and to ``be cautious 
about identifying--victims of sex crimes.'' Ethical journalists treat 
sources, subjects and colleagues as human beings deserving of respect.
    While every effort should be made to ensure victims' rights, public 
safety issues cannot be ignored. If so, it will only result in more 
victims. Consider, for instance, the warm spring Sunday morning in 
1995, when a female student was jogging alone on the sidewalk behind 
the University of Georgia football stadium. Music from her portable 
stereo prevented her from hearing a man slip behind her. The woman was 
dragged into a wooded area, brutally raped and beaten with a rock. Left 
for dead, she managed to haul her battered body to the street. A 
passing motorist mistook the woman for a hit-and-run and called an 
ambulance.
    Several hours after the attack was reported, University of Georgia 
police issued a press release with specific information about the time 
and location of the assault. It also included a description of the 
woman's assailant. This immediate response most likely prevented 
another assault because the campus community was an informed community.
    There is no logical reason for officials to deny access to crime 
reports or disciplinary records. Protection of a school's reputation is 
not adequate justification. Nor is the protection of an individual 
worth endangering other lives within a college or university community. 
Only when fully informed of the nature and extent of crime on campuses 
can students, faculty and the community at large take measures to 
protect themselves and make their collegiate environment safe for all.
    On behalf of the Society of Professional Journalists, the Campus 
Courts Task Force and students throughout the nation, I thank you for 
your time.
                                 ______
                                 
               Prepared Statement of Martha Jean Lorenzo
         re: commonwealth of massachusetts v. brendan d. garvey
    Dear Committee Members: On March 4, 1998, 18 months after Brendan 
Garvey raped our daughter, Angela M. Lorenzo, as she slept in her 
college dormitory bedroom, Garvey (age 19 and paroled on September 4) 
pled guilty to a lesser charge of sexual assault and battery on a 
person 14 years or older. While this was not the charge Angela truly 
sought (as she expressed to the judge), reasonable doubt was a serious 
factor she considered after the defense attorney portrayed Angela as an 
alcoholic and immoral young woman.
    Angela endured 2 days of painful testimony. She is one of the few 
women who decide to press charges; she flew to Massachusetts from her 
home in Florida three times, at her own expense, to seek justice.
    Angela was a freshman student at Wheaton College in Norton, 
Massachusetts. She was thrilled at having been accepted to the college 
of her choice and was to play on the softball team. But, only 14 days 
into her first semester, one of her roommates invited three ex-convicts 
to visit the campus. On the second occasion, after a few attempts to 
remove herself from a very unsafe situation, Angela and a third 
roommate fell asleep. Angela awoke to Garvey raping her.
    And so began a nightmare. Angela and her family have only begun to 
heal now following the trial and Garvey's conviction. Hearing Garvey 
admit he had touched her without her consent was music to Angela's 
ears. She felt vindicated, but only momentarily, because post-rape 
traumatic stress syndrome is now dominating her life. Her future is 
uncertain.
    As her mother, I prepared my daughter as to avoid roofies, date 
rape, and other dangerous scenarios. But the thought of a convicted 
felon, the boyfriend of a new roommate, being in her bedroom never 
entered my mind. Well, perhaps her tragic story will help others.
    Angela is here to hug and hold and talk to. She did not become a 
murder statistic; the Lorenzo family is grateful for that. But the 
system of trying to obtain justice was grueling, especially at the 
actual trial. The assistant district attorney was not impressed with 
her case. But Angela never wavered in her quest for justice. The dean 
of students at Wheaton has always been supportive of Angela's case. 
There has never been the slightest hint to hush it up.
    Our family has been turned inside-out and thus we are willing to 
share this personal, sensitive story with you to try to make our 
college campuses safer places. Our 18-year-old daughter arrived at 
college full of hope and anticipation. Now, sadly, a lot of confusion, 
fear and pain have replaced her dream.
    Thank you for accepting Angela's story. We hope you remember these 
words from a mother, from a family devoted to its daughter and sister.
                                 ______
                                 
 Prepared Statement of Stanley Herrera, President, Alamo Navajo School 
                                 Board
    The Alamo reservation is a ten-square-mile non-contiguous part of 
the Navajo Nation in east-central New Mexico, about 250 miles from the 
Nation's headquarters in Window Rock, Arizona and near the small town 
of Magdalena. Because of our reservation's physical isolation from the 
``Big Navajo'' reservation, the Alamo School Board is the primary 
source of most governmental services to our 1,800 community members.
    Since 1983, the Alamo Navajo School Board has successfully operated 
a Head Start program, first as a sub-grantee of the Navajo Nation Head 
Start program and, since 1997, as a direct grantee under the American 
Indian Programs Branch of the Head Start Bureau.
    In the fiscal year 1999 Labor, Health and Human Services, and 
Education appropriations bill and report, we urge the Subcommittee to 
take the following critical actions regarding Head Start:
  --Fully fund the Administration's fiscal year 1999 budget request of 
        $4.66 billion for the Head Start program;
  --Prioritize the construction of badly-needed new Head Start 
        facilities; and
  --Encourage the Department of Health and Human Services (HHS) to 
        allow tribal organizations to administer Head Start programs 
        under Public Law 93-638 self-determination contracts.
     budget request would improve head start access for needy kids
    Head Start works. For this simple reason, the Head Start program 
has historically enjoyed strong bipartisan support in Congress and the 
White House and from the general public. Even as pressure has mounted 
to control the federal budget deficit and cut domestic discretionary 
spending, Congress has increased Head Start appropriations 
dramatically. Unfortunately, even the current funding level of 
approximately $4.36 billion leaves far too many eligible children out 
in the cold.
    Children who live in poverty and near-poverty conditions have a 
high risk of educational failure, but studies show that such high 
quality early education programs as Head Start give these kids the lift 
they need to succeed later in life. At Alamo, we have found that our 
Head Start children enter kindergarten much more prepared to learn than 
their classmates whom our program was unable to serve.
    By fully funding the Administration's fiscal year 1999 budget 
request of $4.66 billion, you will give another 30,000 children the 
hope and opportunity Head Start provides.
             facility construction must be a high priority
    The Administration's goal is to increase Head Start enrollment to 
one million. This will intensify what is already in many areas a 
critical facilities shortage.
    Congress has repeatedly recognized the pressing need to safe Head 
Start facilities. The House Committee on Education and Labor stated in 
H. Rept. 102-763, the report accompanying the Head Start Improvement 
Act of 1992 that ``of primary importance to the Head Start community, 
and an important focus in the attempt to serve families in need, is 
ensuring that the infrastructure for Head Start programs is in place 
before increases in funding are undertaken.''
    Because adequate facilities were still not available in many low-
income communities when Head Start was reauthorized in 1994, the 
statute was amended to give the Secretary the authority to use funds 
for capital expenditures for Head Start construction if she determines 
that suitable facilities are not otherwise available to tribes, rural 
communities and other low-income communities, that the lack of these 
facilities will hurt program operations, and that construction is less 
expensive than purchasing or renovating an existing facility.
    We urgently request the Subcommittee to go one step further and 
designate a specific portion of the fiscal year 1999 Head Start 
appropriation for facility needs. The problems we face at the Alamo 
Navajo facility--which we are proposing to replace using a cooperative 
funding agreement using federal, state and tribal resources--illustrate 
why additional facility funding is necessary to preserving the overall 
quality of the Head Start program.
    Our current facility is a two-room school constructed in 1972. 
Settling of the foundation has created large cracks in the exterior 
block walls and the floors. The building's poor structural condition 
has been documented by the Indian Health Service Office of 
Environmental Health in its annual health and safety survey. 
Furthermore, space limitations prevent Alamo Navajo from serving all of 
our Head Start-eligible children. We can only serve 35 children at one 
time. So that we could increase the number of eligible children served, 
we applied for and received expansion funds to serve 55 children. To 
accommodate these extra kids, we have had to institute double shifts. 
Even so, we have a waiting list every year of 10 to 20 children and 
have to limit the children served to 4-year-olds.
    Our reservation birth rate continues to grow. In 1995, 52 children 
were born in our community, and nearly all of them meet Head Start 
eligibility criteria. We expect to have approximately 95 Head Start-
eligible children in two years--but we do not have the space to provide 
them with the services they should receive.
          allow tribes to administer local head start programs
    Section 102 of the Indian Self-Determination Act (Public Law 93-
638) directs the Secretary of Health and Human Services (HHS) to 
contract with tribes to operate federal-funded programs for their 
members.
    Administering a tribal Head Start program through a self-
determination contract would be an attractive option for many tribes 
and tribal organizations, including the Alamo School Board. It would 
decrease the amount of federal red tape and paperwork that we must go 
through by allowing us to receive all of our funds directly from Head 
Start using one funding document, reduce micromanagement by bureaucrats 
in Washington, and--most importantly--allow us to better tailor our 
local programs to meet local needs.
    Unfortunately, HHS has discouraged tribal contracting for Head 
Start and has restricted self-determination contracts with tribes to 
Indian Health Service programs. Frankly, self-determination contracts 
for Head Start would be a ``win-win'' situation for both tribes and 
HHS.
    Therefore, we request that you include fiscal year 1999 report 
language that would encourage the Secretary to work with tribes to 
fully implement the Indian Self-Determination Act so that tribal 
organizations may contract for such HHS programs as Head Start.
                               conclusion
    Thank you for your past support of the Head Start program. We are 
confident that you will give the same thoughtful consideration to our 
concerns and to the current needs of children in Indian country.
                                 ______
                                 
     Prepared Statement of Carol C. Henderson, Executive Director, 
          Washington Office, the American Library Association
    The American Library Association appreciates the opportunity to 
provide this statement for review and inclusion in the hearing record 
for fiscal year 1999 Appropriations. The 58,000 members of ALA, 
including public, school, state, academic and special librarians, 
library supporters, trustees, and friends of libraries, thank the 
Labor, Health and Human Services and Education Subcommittee for your 
support in the past and request a funding level of $160 million for the 
second year of the Library Services and Technology Act.
    In addition, we ask that you fund the Improving America's Schools 
Act existing Title VI block grant at as high a level as possible above 
the fiscal year 1998 level of $350 million. This Title is the only 
funding possibility for school libraries and the Department of 
Education estimated last year that at least 40 percent of the funding 
goes for school library materials and resources.
Library Services and Technology Act
    The Library Services and Technology Act was passed and signed into 
law on September 30, 1996. The purpose of the legislation is to 
consolidate Federal library programs while stimulating excellence and 
promoting access to learning and information resources in all types of 
libraries for individuals of all ages.
    The provisions of the Library Services and Technology Act promote 
library services that provide all users access to information through 
State, regional, national and international electronic networks and 
provide electronic linkages among and between libraries. The law 
promotes targeted library services to people of diverse geographic, 
cultural and socioeconomic backgrounds, to individuals with 
disabilities and to people with limited functional literacy or 
information skills.
    Most funds are allocated through state library agencies, which 
administer programs and develop cooperative plans for use of the funds; 
3\3/4\ percent of the funds are to be used for national leadership 
purposes and 1\1/2\ percent for tribal library services.
    The Library Services and Technology Act builds on the strengths of 
previous federal library programs but has some major advantages and 
differences. It retains the state-based approach, but sharpens the 
focus to two key priorities: information access through technology; and 
information empowerment through special services.
    New technology and a multitude of community needs will shape the 
way we seek and obtain information. The Library Services and Technology 
Act encourages interlibrary cooperation, emphasizes libraries as change 
agents and implementers of equity, extends libraries' reach as self-
help institutions and community partners in lifelong learning and 
literacy, economic development, jobs information, health information, 
etc.
    Public libraries of today are vastly different from the libraries 
of thirty years ago and the libraries of the next millennium will be 
different as well. The new LSTA gives states the flexibility to 
determine state needs and shape library programs to address those 
needs.
    The following examples illustrate the kinds of innovative projects 
libraries are conducting with the use of federal funds to connect 
people to information that can help to change lives, advance education 
and contribute towards the productivity of the nation:
    Student needs.--The Houston Public Library system has established 
ASPIRE, after school programs for students which provide assistance 
from tutors with homework, a rich supply of books and other materials 
to support that homework, access and training on resources on the 
Internet, and special programs and activities along with library 
instruction. Three branch libraries have the program underway with two 
more to be implemented soon. The success stories of student improvement 
have brought rewards to librarians and volunteer tutors as well as the 
students who have made great strides academically.
    Literacy.--Springfield's Lincoln Library in Illinois has a 
collaborative family literacy project which coordinates activities at 
the library with the local literacy program. Families attend a family 
fun night at the library where library services are presented and 
reading activities occur. The librarian also visits the local school as 
part of this coordinated effort to reach low-literacy families.
    The Ela Area Public Library District in Lake Zurich, Illinois, has 
an outreach program for senior citizens in nursing homes where trained 
volunteers conduct a Read-Aloud group. The reading and discussion group 
encourages older adults to continue their love of reading and enjoyment 
of books.
    Technology.--The 1997 National Survey of U.S. Public Libraries and 
the Internet sponsored by the ALA and the U.S. National Commission on 
Libraries and Information Science found that fewer than 1 in 7 library 
branches offer World Wide Web access (see attachment for the latest 
data on public library connectivity).
    States are making major strides in improving and upgrading access 
to new technology in libraries. The Library Services and Technology Act 
is critical to progress. For example, South Carolina expects all 184 
public library sites to have Internet access this year. Florida has 
used LSTA funds to enhance library connectivity to the Internet through 
its statewide FloriNet program. FloriNet has assisted public libraries 
in providing graphical Internet access to their users. More than 200 
Florida public library outlets have connected through FloriNet grants, 
and by September 1998, there will be public Internet access in at least 
one public library in every one of the state's 67 counties. Other 
states have similar initiatives underway, using LSTA and other sources 
of assistance to help with the major investment libraries must make to 
ensure that all Americans have access to advanced information 
technologies.
    The federal role in support of libraries helps to ensure that the 
existing information infrastructure of libraries is technologically 
equipped to perform governmental functions cost effectively. Examples 
include supporting literacy and lifelong learning, organizing and 
providing access to federal, state, and local government information 
and other community information, undergirding economic development by 
providing jobs information and supporting small businesses and 
providing access to consumer health information.
    Past library funding was administered by the Department of 
Education library programs through the Library Services and 
Construction Act. With the new law, the Library Services and Technology 
Act, administration of the program moved to the Institute of Museum and 
Library Services (IMLS). The new home for library programs in IMLS is 
working out well, and the IMLS leadership has established good working 
relationships with the library community. In addition, cooperative 
interaction between libraries and museums is increasing in very 
innovative ways. The Federal investment in the former Library Services 
and Construction Act and the new Library Services and Technology Act 
has acted and will act as a stimulant to local and state investment 
because of matching requirements, and because the E-rate discounts are 
requiring libraries to make the additional investment required to 
support advanced telecommunications.
    The Administration's budget requests level funding for library 
programs. In this second year of funding of the new Library Services 
and Technology Act, it is particularly important for Congress to 
continue increasing resources to improve library programs to realize 
the goals of the new legislation. For fiscal year 1999, ALA recommends 
an appropriation for LSTA of $160 million.
    A strong investment will connect more libraries to the Internet and 
support in-depth training on the nature and use of the Internet for the 
public at the one community institution available to all. It will 
continue to support literacy and education, help libraries provide job 
and consumer health information, serve small businesses, provide 
information for lifelong learning, and allow for effective leadership 
projects. (See attached examples of Internet training in libraries).
IASA title VI
    The reauthorization of the Elementary and Secondary Education Act 
(the Improving America's Schools Act), included renewal of the Title VI 
(formerly Chapter 2) block grant. This block grant allows funding of 
school library resources and materials among its uses of funding. Our 
children deserve not only technological resources but the resources for 
in-depth research as well. We ask the Subcommittee to fund IASA Title 
VI at as high a level as possible above the fiscal year 1998 level of 
$350 million. The Administration's budget did not request funding for 
this program.
Other initiatives
    The Administration's fiscal year 1998 budget proposed increased 
funding for IASA Title III Educational Technology. We ask the 
Subcommittee to fund IASA Title III at the requested level. We 
recommend funding of children's literacy initiatives such as the 
President's America Reads Challenge or the House-passed Reading 
Excellence Act. We also ask that you fund other programs under your 
jurisdiction that improve reading skills, literacy and lifelong 
learning, technological literacy, the National Library of Education, 
and educational research and statistics. We also urge support of the 
budget request of the U.S. National Commission on Libraries and 
Information Science.
    We thank the Subcommittee for the consideration you have shown for 
libraries in the past, and particularly for your part in accomplishing 
the reauthorization of the Library Services and Technology Act in the 
Fall of 1996.
                                 ______
                                 
Prepared Statement of Rock Point Community School Board, Rock Point, AZ
    Mr. Chairman and Members of the Committee: The Rock Point Community 
School Board urges the Subcommittee to take the following actions 
regarding Head Start in the fiscal year 1999 Labor, Health and Human 
Services, and Education appropriations bill and report:
  --Fully fund the Administration's fiscal year 1999 budget request of 
        $4.66 billion for the Head Start program;
  --Prioritize the allocation of facilities maintenance funds within 
        the Head Start appropriation;
  --Prioritize the construction of badly-needed tribal Head Start 
        facilities;
  --Address the transportation needs of Head Start-eligible children; 
        and,
  --Encourage the Department of Health and Human Services (HHS) to 
        allow tribal organizations to administer Head Start programs 
        under Public Law 93-638 self- determination contracts.
                               background
    The Rock Point community is located in an especially isolated area 
of the Navajo Nation reservation. The community's Head Start program, 
which is one of 180 Head Start centers operated by the Navajo Nation 
through a direct grant from the Head Start Bureau American Indian 
Programs Branch, serves a total of 30 children. Twenty are served at 
the Head Start center and ten who live in particularly remote areas 
receive 1.5 hours of weekly home-based instruction.
    The Rock Point Community School Board currently is in the process 
of applying for direct grantee status to operate the Head Start 
program. By becoming a direct grantee, we will be able to run a Head 
Start program which best suits the unique needs of our small community.
     budget request would allow us to serve more eligible children
    Because of its successful track record, Members of Congress from 
both sides of the aisle have supported Head Start. In fact, even while 
Congress and the Administration has worked to cut deficit spending and 
balance the budget, Head Start spending has grown.
    At the Rock Point Community School, we see that children who have 
attended Head Start are more ready to learn. Unfortunately, the current 
$4.36 billion funding level does not allow us to serve all of our Head 
Start-eligible children. The Head Start program serves 20 children ages 
three through five, four days per week for six hours per day, plus 
another ten children through extremely limited home-based instruction. 
That said, at least 50 children are eligible for comprehensive Head 
Start services, based on the kindergarten enrollment statistics for the 
Rock Point Community School--but we lack the funding to expand our 
program.
    That is why we strongly support the Administration's long-range 
goal of increasing Head Start enrollment to one million. If the 
Subcommittee fully funds the Administration's fiscal year 1999 budget 
request of $4.66 billion, another 30,000 children will reap the 
benefits of Head Start and we will be one step closer to reaching this 
important goal.
                     maintenance dollars are needed
    Our Head Start facility is a two-room building consisting of a 
kitchen area and a classroom. It was built approximately 37 years ago 
and currently has numerous health and safety deficiencies, a number of 
which were documented in a March 9, 1998 Indian Health Service/American 
Indian Programs Branch Head Start Health and Safety Report. The 
following lists some of the most frightening of 23 critical violations 
cited in the report.
  --Lead was detected at harmful levels in the drinking water.
  --On-site wastewater system was not properly operated or maintained. 
        This facility experienced a back-up of sewage recently that 
        resulted in a closure of school operations for a week.
  --Gas, sewer and water piping fixtures and appurtenances were not 
        free of leaks or defects, namely the wall coverings above most 
        all wall-mounted gas heaters were peeled.
  --Exterior gas shut-off was not accessible.
  --Fuel gas storage tanks were not properly installed or maintained.
  --The facility did not meet minimum fire safety standards for 
        educational occupancies.
  --Electrical wiring did not meet the minimum safety requirements.
  --Plumbing and fixtures were not constructed or maintained in a 
        sanitary manner.
  --Handwashing sinks were not provided with hot and cold running 
        water, namely one bathroom lacked cold water and another lacked 
        hot water.
  --The playground fence was not adequate to provide separation from 
        vehicle traffic, restrict children from leaving the premises, 
        or restrict animals from the play area.
  --Playground equipment was not free of sharp edges, protruding parts, 
        or defects that could injure a child.
  --Excessive amounts of potentially harmful radon gas were found 
        within the facility.
    Clearly, in order to protect the health of those children currently 
served through the Head Start program, we must ensure that there are 
adequate maintenance dollars to correct these grievous conditions 
immediately. If additional dollars are not provided for this critically 
needed maintenance, we will be forced to use funds that should be used 
to increase enrollment of eligible children and we will experience 
continued deterioration of our existing facility.
        replacement facility construction should be prioritized
    Without funding to build new--and safe--facilities, the goal of 
increasing Head Start enrollment to one million will be meaningless to 
Rock Point. In order to expand services to the 50 children who are 
eligible for Head Start, we will need an additional building, which we 
also would like to use as a central facility for early education 
services.
    Because adequate facilities were not available in many low-income 
communities when the Head Start program was reauthorized in 1994, the 
Secretary was authorized to use funds for capital expenditures for Head 
Start construction if she determines that suitable facilities are not 
otherwise available to tribes, rural communities and other low-income 
communities, that the lack of these facilities will hurt program 
operations, and that construction is less expensive than purchasing or 
renovating an existing facility.
    At Rock Point and in many other locations around the country, we 
are still waiting for these funds. Therefore, we ask you to allocate a 
specific portion of the fiscal year 1999 Head Start appropriation for 
facility needs.
                        children need buses, too
    Access to our community, which is scattered over a radius of 15 
miles, is primarily by dirt roads. Because these roads become extremely 
muddy and icy during the winter, extra funds are needed to maintain and 
repair our one Head Start bus, which is old and in poor condition. Even 
worse, the closest bus maintenance and service location is a 250-mile 
round trip.
    Compounding this situation is the fact that GSA rental and mileage 
rates are escalating, which means we have to pay more and more out of 
our limited transportation budget.
    We request that additional bus maintenance and replacement funds be 
provided through the Head Start appropriation.
          allow tribes to administer local head start programs
    Section 102 of the Indian Self-Determination Act (Public Law 93-
638) directs the Secretary of Health and Human Services (HHS) to 
contract with tribes to operate federally-funded programs for their 
members.
    The Rock Point Community School Board has successfully contracted 
education programs since 1972 and has continually improved student 
services during this time period. As such, the Board believes that 
administering a tribal Head Start program through a self- determination 
contract would be beneficial. It would decrease the amount of federal 
bureaucracy that we deal with by allowing us to receive all of our 
funds directly from Head Start using one funding document and would let 
us to run our local programs to meet local needs.
    Unfortunately, HHS has discouraged tribal contracting for Head 
Start and has restricted self-determination contracts with tribes to 
Indian Health Service programs. Frankly, self- determination contracts 
for Head Start would be a ``win-win'' situation for both tribes and 
HHS.
    Therefore, we request that you include fiscal year 1999 report 
language that would encourage the Secretary to work with tribes to 
fully implement the Indian Self-Determination Act so that tribal 
organizations may contract for such HHS programs as Head Start.
                               conclusion
    Thank you for your past support of the Head Start program. We are 
confident that you will give the same consideration to our concerns.
                                 ______
                                 
  Prepared Statement of David M. Gipp, President, and Russell Mason, 
 Board President and Chairman, Three Affiliated Tribes of North Dakota
          united tribes technical college: making a difference
    Summary of Request. For thirty years United Tribes Technical 
College (UTTC) has been providing postsecondary vocational education, 
job training and family services to Indian students from the Great 
Plains and throughout the nation. An inter-tribally controlled 
educational institution,\1\ UTTC was assisting Indian people in moving 
from public assistance to economic self-sufficiency long before the 
1996 welfare reform act. Our placement rate in 1997 was 96 percent. The 
request of United Tribes Technical College for fiscal year 1999 
Department of Education funding for tribally controlled postsecondary 
vocational institutions as authorized under Title III, Part H of the 
Carl Perkins Vocational and Applied Technology Act is $4 million. This 
is $900,000 over the fiscal year 1998 enacted amount and the same as 
the authorized level.
---------------------------------------------------------------------------
    \1\ The college is owned and operated by five federally-recognized 
tribes situated wholly or in part in North Dakota. These Tribes are the 
Spirit Lake Sioux Tribe, the Sisseton-Wahpeton Sioux Tribe, the 
Standing Rock Sioux Tribe, the Three Affiliated Tribes of the Fort 
Berthold Reservation, and the Turtle Mountain Band of Chippewa. Control 
of the institution is vested in a ten-member board of directors 
comprised of elected Tribal Chairpersons and Tribal council members.
---------------------------------------------------------------------------
    This funding is essential to our survival as we receive no state-
appropriated vocational education monies.
    The Administration's Request. Title III, Part H of the Carl Perkins 
Act currently provides support to UTTC and one other tribally 
controlled postsecondary vocational institution, the Crownpoint 
Institute of Technology. The Administration's request is for $3.1 
million, the same as the fiscal year 1998 enacted level. The Department 
of Education's budget justification is misleading, however, in that it 
states that funding for the tribally controlled postsecondary 
vocational institutions will be consolidated with the 1.25 percent 
tribal allocation under the Perkins Act. While the Administration's 
proposed vocational education reauthorization bill would have 
consolidated these programs, both the House-passed and the Senate 
committee-approved vocational education bills (H.R. 1853/S. 1186) 
maintain our program separate from the tribal allocation. We opposed 
the Administration's proposal in this regard and are pleased that the 
pending authorization bills would maintain a tribal postsecondary 
vocational education program.
    United Tribes Technical College: A Unique Inter-Tribal Educational 
Organization. United Tribes Technical College is the only inter-
tribally controlled, campus-based, postsecondary vocational institution 
for Indian people. Our campus is the site of the Fort Lincoln Amy Post, 
an 110-acre area near Bismarck, North Dakota. We currently enroll 310 
students from 36 tribes and 17 states. In addition, we serve 110 
children in our pre-school programs and 115 children in our elementary 
school, bringing the population for whom we provide direct services to 
535. In some years our students come from as many as 45 tribes.
    Educating Students and Placing Them in Jobs. We are proud of the 
education, skills and services provided by UTTC for our students and 
their families over the past thirty years. And we are proud that this 
education is taking placing in a tribal setting, where our students and 
their families can maintain and strengthen their tribal heritage. We 
have had a placement rate exceeding 80 percent sustained over the last 
10 years, and in 1997 had a placement rate of 96 percent. This success 
is all the more gratifying in light of the background of our students, 
most of whom come from tribal areas where poverty and unemployment are 
the norm. A large proportion of our students are from the fourteen 
tribes in the Dakotas, where unemployment among Indian people is 
chronic. BIA Labor Force data reports the percentage of potential 
Indian labor force on and near reservations in the Aberdeen Area (North 
Dakota, South Dakota, Nebraska) who are jobless is 75 percent.
    UTTC Course Offerings and Coordination with Other Educational 
Institutions. UTTC offers 8 Certificate and 12 Associate of Applied 
Science degree programs.\2\ Entrepreneurship and new technology skills 
are being integrated into appropriate curricula. All programs are 
accredited through the North Central Association of Colleges and 
Schools at both the certificate and two-year degree granting levels. 
During the last re-accreditation process (1996), the NCACS authorized 
UTTC to begin developing curricula for 4-year degrees.
---------------------------------------------------------------------------
    \2\The following one-year certificates are offered: Office 
Technology, Automotive Service Technician; Construction Trades 
Technology with options in Carpentry, Electrical, Plumbing, and 
Welding, Early Childhood Education; Criminal Justice; Hospitality 
Management: Food & Beverage Specialization; Medical Secretary.; and 
Welding Technician.
    The following two-year Associate of Applied Science (A.A.S.) 
degrees are offered: Arts/Marketing; Automotive Service Technology; 
Construction Trades Technology with options in Carpentry, Electrical 
Plumbing and Welding; Criminal Justice; Early Childhood Education; 
Health Information Technology; Hospitality Management: Food and 
Beverage Specialization, Office Technology with emphasis in computer 
applications or accounting; Practical Nursing; Small Business 
Management; Welding Technology; and Dietetic Technician.
---------------------------------------------------------------------------
    UTTC has transfer and articulation agreements with other colleges 
so our graduates can transfer to four-year schools from areas including 
Licensed Practical Nursing, Criminal Justice, Business and 
Entrepreneurship and Health Instruction. We provide academic 
instruction which provides our graduates the background to pursue 
additional college work.
    UTTC has been a member of the Interactive Video Network of North 
Dakota's colleges, universities and tribal colleges since 1994. This is 
expanding the educational opportunities for our students.
    Job Training and Economic Development. UTTC is a designated Indian 
Minority Business Center serving Montana, South Dakota and North 
Dakota. We also administer a Job Training Partnership Act program and 
an internship program with private employers. And, thanks to a grant 
from the Kellogg Foundation, we are assisting tribes and tribal members 
in the Aberdeen Area with rebuilding buffalo herds.
    Coordination with State Welfare-to-Work Efforts. UTTC is working in 
cooperation with the state of North Dakota on welfare reform. We are 
serving state-referred Temporary Assistance for Need Families (TANF) 
recipients who are able to participate in our Cooperative Education 
internship program with private employers. By attending UTTC, these 
TANF recipients can meet their work, training and volunteer 
requirements. And we are providing child care for 60 children of state-
referred TANF recipients.
    We take exception to the 12-month statutory limit on the length of 
time a TANF recipient can be enrolled in a vocational education course 
and still be eligible for TANF. This limits TANF recipients to taking 
one-year certificate courses at UTTC. Our experience shows that the 
students who graduate from a two-year, rather than a one-year, course 
have significantly higher earning power. Many of our students come to 
UTTC planning to take a one-year course, and then, finding themselves 
in a supportive environment and seeing the economic benefit of the 
longer course, decide to work for the two-year degree.
    Serving Families Contributes to Education and Job Placement. We 
believe that a primary reason for UTTC student success is that we serve 
the students' social, academic and cultural needs. Many of our students 
are the first generation in their family to attend college and for many 
it is their first experience in living away from home. Many students 
are on public assistance and many have families of their own. Some of 
our services are:
  --Early childhood services for 110 children, ages 8 weeks to five 
        years;
  --The Theodore Jamerson Elementary School (grades K-8) serving 115 
        Indian students;
  --A health clinic which, among others services, provides 
        immunization, health education, eye and dental exams, and 
        referrals to other health care providers;
  --Family housing and dormitories for solo parents and for students 
        without children;
  --A local transportation system for students for school activities 
        and necessary appointments e.g., (doctor appointments) outside 
        the campus. Most UTTC students do not have cars.
    UTTC Seeks Other Funds. UTTC is aggressive in seeking funding 
outside the Perkins Act for special needs. For example, we combined 
Department of Agriculture, Economic Development Administration and 
state Community Development Block Grant funds and replaced our aging 
water, sewer and gas systems in 1997. However, we still need $350,000 
for replacement and repair of roads damaged as a result of this 
project.
    Our elementary school received a competitive Department of 
Education grant for computer technology, and was one five Indian 
schools to receive this funding. We also received a Kellogg Foundation 
grant to develop buffalo management skills for the tribes and their 
members throughout the Aberdeen Area, as they attempt to rebuild herds 
of buffalo decimated more than 100 years ago.
    The above mentioned grants are highly competitive, restrictive, 
one-time grants, and they cannot provide for day-to-day operations. We 
cannot survive without the basic operating funds which come through the 
Department of Education's tribally controlled postsecondary vocational 
institutions program.
    Current Needs. We certainly appreciate the $200,000 increase 
provided by Congress in fiscal year 1998 for the tribally controlled 
postsecondary vocational program (from $2.9 million to $3.1 million). 
The increase is important, not only for the unmet needs of the current 
grantees, but because other institutions may become eligible for 
funding under this program.
    The operating and purchasing strength of our budget has diminished 
by some 20 percent since 1990. Utility costs are especially difficult. 
Electricity expenses have risen about 20 percent per unit and the per 
unit gas costs have increases approximately 113 percent during this 
decade. We have been able to partially offset utility rate increases by 
implementing stringent conservation measures such as improved 
weatherization and reductions in building temperatures. However, energy 
consumption cannot be further reduced because of our location and the 
harsh winters in the northern plains.
    While even a $4 million appropriation for the Tribally Controlled 
Postsecondary Institutions program would leave us with enormous needs, 
it would allow us to make improvements in key areas including course 
offerings, student services, and technology. Below are some of our 
financial needs of which we want you to be aware:
  --Housing We need new and rehabilitated campus housing so that we can 
        increase student enrollment. Many of our buildindgs are of 
        historic importance. The College occupies the old Fort Lincoln 
        Army Post, and many people visit our campus to see these 
        buildings. Other than the more recently constructed skills 
        center and the community center, UTTC's core facilities are 90 
        years old. Estimates for new facilities total over $12 million, 
        according to a 1993 U.S. Department of Education report to 
        Congress. Continuing a course of non-repair will ultimately 
        prove more costly as the repairs will be greater. Fire and 
        safety reports document our repair needs.
  --Salaries. We were able to provide a cost-of-living increase for our 
        employees this year. However, our faculty still receive 
        salaries that are lower than in any state college system. North 
        Dakota salaries for higher education faculty are the lowest in 
        the nation--but the average faculty salaries at UTTC are even 
        lower than those in the North Dakota state system.\3\
---------------------------------------------------------------------------
    \3\ Source: Integrated Postsecondary Education Data Systems (IPEDS) 
Report of the U.S. Bureau of the Census and the Department of Education 
Office of Education Statistics.
---------------------------------------------------------------------------
  --Emergency Repair. Our needs for emergency repair on both single and 
        family student housing, instructional facilities and support 
        facilities exceeds $100,000. This amount will obviously not 
        cover major renovations or new facilities. Funding is also 
        needed for maintenance and repair related to damaged caused by 
        inclement weather, including blizzards and extremely low 
        temperatures.
  --Technology. We need funding for computers and hardware to increase 
        our capabilities for distance learning programs for our campus-
        based students and students at other locations. We are working 
        with the Denver Indian Center to provide UTTC classes, via 
        distance learning. to the Indian population in the Denver area. 
        We also need to complete our local area computer network and to 
        provide more staff training.
  --Course Offerings/Student Services. We would like to change some of 
        our courses to better meet new market demands. For example, we 
        want to expand the allied health professions program and also 
        to expand the business clerical program into the business 
        administration area. We also need to expand our diagnostic 
        capabilities in tribal-specific areas and also in the areas of 
        literacy and math-science background. This would allow us to 
        improve student remediation services. Finally, we want to make 
        improvements in our student follow up, career development, and 
        job market research efforts.
    Thank you for your consideration of our request. We need your 
assistance to ensure that the unique educational opportunities offered 
by United Tribes Technical College will be available for what we hope 
will be an increasing number of Indian and Alaska Native students and 
their families next year and in the future.
                                 ______
                                 
   Prepared Statement of Peter Belletto, President, National Indian 
 Impacted Schools Association, Ganado Unified School District, Ganado, 
                                   AZ
    The National Indian Impacted Schools Association (NIISA) is an 
association of public schools in Indian country dedicated to quality 
education and assuring that the United States' obligation to provide 
resources for educating Indian and Alaska Native students is fulfilled. 
Our membership consists of public school districts which receive 
federal Impact Aid funds because of the presence of students from 
Indian trust lands and Alaska Native lands. Approximately 90 percent of 
Indian and Alaska Native students nationwide attend public schools.
    Summary of Request. We ask the Subcommittee to recommend the 
following with regard to the fiscal year 1999 Department of Education 
budget:
  --Impact Aid Basic Support Payments.--$700 million for Impact Aid 
        Basic Support payments. This is the same as the request of the 
        National Association of Federally Impacted Schools and is $38 
        million over the fiscal year 1998 enacted level. This amount 
        would allow the schools to be paid at 100 percent of LOT.
  --Impact Aid Construction.--$25 million under the authority of the 
        Impact Aid statute for payments for Construction. This compares 
        to the fiscal year 1998 enacted level of $7 million and the 
        President's request of no funding. While this is termed a 
        ``construction'' account, the funds can be used only for repair 
        and renovations, not new construction.
  --Education Technology.--$475 million for million for the Technology 
        Literacy Challenge Fund as requested by the Administration to 
        help schools integrate technology into school curricula. This 
        is $50 million over the fiscal year 1998 enacted level. We also 
        support the President's request of an additional $75 million 
        for technology training for new teachers.
    Importance of the Impact Aid Program to Indian Country. For Indian 
country, the Impact Aid program is a vital element of the public policy 
of providing every child a free public education. Signed into law in 
1950, the Impact Aid program is one of the oldest federal education 
programs. Simply put, it provides federal funds for public school 
operations that would have otherwise been provided by local tax 
revenues but for the presence of federal property--in our case, lands 
held in trust by the federal government for Indian tribes. The Impact 
Aid program is an example of the U.S. government carrying out its trust 
responsibility--in this case, for education--for Indian and Alaska 
Native peoples. Some facts about the importance of the Impact Aid 
Program to Indian Country:
  --There are over 600 school districts throughout the country which 
        receive Impact Aid funds for Indian lands schools.
  --Funds for Indian lands students represent nearly 50 percent of the 
        federal Impact Aid appropriation.
  --The Indian Country land base that generates Impact Aid funds 
        consist of 53 million acres of Indian trust land in the lower 
        48 states and 44 million acres included in the Alaska Native 
        Claims Settlement Act.
    Additionally, the Impact Aid law provides a formal link between 
tribal governments and the public schools, providing for school 
district consultation with Indian tribes and tribal communities. This 
is especially important because public schools are State institutions, 
but located on tribal lands. School districts must consult with tribes 
and the Indian community to develop Indian Policies and Procedures 
(IPP). Tribes and parents of Indian students are able to comment on 
whether Indian students are equal participants in educational programs 
and school activities, and to request modifications in school programs 
and materials. Tribes also have administrative appeal rights under the 
statute.
    Attached is a booklet prepared by the Department of Education 
regarding the implementation of the Impact Aid program in Indian 
country.
    School Facilities.--School facilities construction and renovation, 
including making facilities ready for education technology, is a high 
priority for our organization. We are dismayed by the Administration's 
fiscal year 1999 proposal of zero funding for under section 8007 of the 
Impact Aid program--the authority for school repair and renovation. At 
the same time, the Administration requested $10 million for the school 
facilities which the Department of Education owns (section 8008). We 
support the proposed funding for maintenance of DOE-owned school 
facilities, and ask for similar consideration for our school districts.
    The Administration's budget justifies a request of zero funding for 
the section 8007 school construction account by noting that the 
President is proposing legislation which would help school districts 
build schools by paying the interest on school construction bonds. This 
is putting the cart before the horse. Even if such legislation is 
enacted, it would not be an immediately available benefit for those 
schools fortunate enough to avail themselves of the program. It 
certainly would not be available in fiscal year 1999. In the meantime, 
our schools are crumbling.
    NIISA has and will continue to work with Congress on pending school 
construction proposals to make them responsive to the needs of our 
schools--Indian lands public schools. School construction bills have 
been introduced in a steady stream during the 104th and 105th 
Congresses. We have seen in these bills a growing recognition that 
there needs to be accommodation for public school districts which have 
little, if any, bonding capacity (including those schools in the Bureau 
of Indian Affairs system). To the extent that a school district has 
limited ability to generate revenues because of a federal presence 
(e.g., the existence of Indian trust land or federal property in the 
school district), there is a clear federal responsibility toward the 
education of the children attending those schools.
    For instance, S. 12, introduced early in the 105th Congress, would 
have allowed for a waiver on amount of interest which could be paid on 
a school construction bond if ``the local area contains a significant 
percentage of Federally-owned land that is not subject to local 
taxation.'' However, S. 12 did not address the fact that due to the 
presence of federally held lands--e.g., trust lands on Indian 
reservations--there is little, and sometimes, no, bonding capacity. S. 
1705 and S. 1708, introduced on March 4, 1998, have the advantage of 
paying, via a federal tax credit, 100 percent of interest on school 
construction bonds. This credit allocation would be available to both 
local school districts and to states. Importantly, the bills would 
require the state, in order to receive a federal tax credit allocation, 
to explain how it will use its allocation to assist localities that 
lack the fiscal capacity to issue bonds on their own. Should states opt 
to issue bonds for their school districts which lack bonding capacity, 
it would benefit public school districts with large amount of Indian 
trust lands.
    The condition of public and Bureau of Indian Affairs school 
facilities has been documented in General Accounting Office (GAO) 
surveys. In October, 1996, our organization undertook a survey of 
school districts which receive Indian lands Impact Aid funding. Our 
survey went further than bricks and mortar. It also asked questions 
regarding the ability of the school district to raise revenue for 
facility construction--something not done by the GAO surveys. Finally, 
the survey contained a series of questions regarding each school 
district's readiness for computers, the internet and other education 
technology. We reported some of the findings from the survey in our 
appropriations statement last year, and repeat them here:
  --65 percent of buildings are over 20 years old, including 38.2 
        percent over 30 years old;
  --$6,872,000 is the average estimated costs necessary for repairs, 
        renovations, modernization and construction to put schools in 
        overall good condition;
  --The average cost per student to make school buildings meet health 
        and safety standards is $1,947;
  --To accommodate expected increased enrollment over the next 5 years, 
        the schools responding to the survey will need 13.1 percent 
        more space. Within 10 years, the space needs are expected to 
        increase by 27.9 percent;
  --71 percent of school districts have had no school construction bond 
        issued since 1985, and 23 percent of school districts have 
        never had a bond issued;
  --Of schools with 70 percent LOT MOD and higher, the need for 
        construction, renovation, and repair funding is two thirds 
        higher per pupil than in the other respondents to the NIISA 
        survey. (Note: LOT MOD is a Department of Education measure of 
        need of school districts affected by the presence of federal 
        property);
  --42 percent of respondents have unhoused students;
  --59 percent of school buildings have inadequate laboratory science 
        space;
  --63 percent of schools are not well served for before/after school 
        care.
    Education Technology.--NIISA thanks Congress for providing a 
significant increase in education technology in the fiscal year 1998 
Education Department budget, and supports the President's request for 
$475 million for Technology Literacy Challenge Fund to help schools 
integrate technology into the curriculum. We also support the 
Administration's request of $75 million for technology education for 
new teachers. Although there is considerable public discussion about 
linking schools to the internet, NIISA's survey results show that many, 
many schools lack the electrical, telephone and other infrastructure 
necessary to utilize modern educational technology. The NIISA survey 
responses show:
  --75 percent of school buildings need funding for infrastructure to 
        support education technology--this compares to the 60 percent 
        figure in the GAO surveys;
  --56 percent of school buildings have significant needs for computers 
        for instructional use;
  --61 percent of school buildings have significant needs for modems;
  --81 percent of school buildings need telephone lines for instruction 
        areas;
  --79 percent of school buildings need fiber optic cable; and
  --62 percent of school buildings need for electrical wiring for 
        computers.
    Thank you for your interest in the need of our public schools which 
educate children from Indian country. We ask you to always keep in mind 
the trust responsibility for the education of Indian and Alaska Native 
children and the federal responsibility regarding school districts 
which contain Indian and federal property.
                                 ______
                                 
     Prepared Statement of The National Military Family Association
    The National Military Family Association (NMFA) is the only 
national organization whose sole focus is the military family and whose 
goal is to influence the development and implementation of policies 
which will improve the lives of those family members. Our mission is to 
serve the families of the Seven Uniformed Services through education, 
information and advocacy.
    Founded in 1969 as the Military Wives Association, NMFA is a non-
profit 501 (c)(3) primarily volunteer organization. NMFA today 
represents the interests of family members and the active duty, reserve 
components and retired personnel of the seven uniformed services: Army, 
Navy, Air Force, Marine Corps, Coast Guard, Public Health Service and 
the National Oceanic and Atmospheric Administration.
    NMFA Representatives in military communities worldwide provide a 
direct link between military families and NMFA staff in the nation's 
capital. Representatives are the ``eyes and ears'' of NMFA, bringing 
shared local concerns to national attention.
    NMFA receives no federal grants and has no federal contracts.
    NMFA has been the recipient of the following awards: Military 
Impacted Schools Association ``Champions for Children'' Award (1998) 
Defense Commissary Agency Award for Outstanding Support as Customer 
Advocates (1993) Department of the Army Commander Award for Public 
Service (1988) Association of the United States Army Citation for 
Exceptional Service in Support of National Defense (1988)
    Various members of NMFA's staff have also received personal awards 
for their support of military families.
    NMFA's web site is located at: http://www.nmfa.org
    NMFA and the families we represent are grateful to this 
Subcommittee and the Senate for its efforts on behalf of military 
children and the Impact Aid Program. We commend all Congressional 
supporters of Impact Aid, including the members of the House and Senate 
Impact Aid Coalitions, for securing the fiscal year 1998 appropriation 
of $808 million--an increase of $78 million over fiscal year 1997 and 
$150 million over the Administration's proposal. We are a small, but 
wide-spread constituency and it is important that all Members of 
Congress understand the importance of the Impact Aid program to 
approximately 500,000 military children and several million of their 
civilian classmates in school districts across the country. NMFA 
appreciates this opportunity to express its views.
                     the military family and child
    NMFA presents this statement on behalf of military families, or 
more specifically on behalf of military children. These children move 
every 2 to 4 years and attend an average of five different schools. 
Since the drawdown overseas, those schools are more likely to be in 
stateside systems dependent on Impact Aid rather than in Department of 
Defense Schools. Military children bring a rich experience gained from 
travel and learning in other parts of the United States and the world 
to the schools they attend. But they also bring the apprehension and 
insecurities faced by any child who must not only adjust to a new 
teacher and new classmates each year, but to different school systems. 
They are ahead of the class in some schools or performing below grade 
level in others. They lose credits needed for graduation because of 
different course standards. They enter school too late to win a spot on 
the school paper or cheerleading squad. They must adjust to different 
curricula and standardized tests. Sometimes the military child's 
transition into a new school is further complicated by the absence of 
the military parent.
    Military families want to be involved in their children's 
education. They serve as room parents, vote for school board members, 
and raise money for playground equipment and computers that might not 
be installed until after they've moved away. Military families list 
education as one of their most important Quality of Life concerns. 
Military commanders know that worries over the education of their 
children affect the morale and retention of personnel. And, in this age 
of increased accountability, military families hold their children's 
schools to a higher standard than any state does. They insist that 
schools prepare their children to enter school at their next 
assignment, no matter where in the world that might be, with the skills 
and knowledge necessary to succeed. They expect their children's 
schools to have the necessary resources to orient families, process 
records, provide counseling, evaluate students' strengths and 
weaknesses, and place them in the right programs.
    Military families understand that the Impact Aid program supports 
basic education services provided by their local school districts. They 
hold the government, and the citizens they have sworn to serve and 
protect, accountable for living up to their promise to provide a 
quality education for their children. The districts have accepted the 
responsibility to educate our children; the Federal government must 
provide the resources it has promised to support that education.
                         federal responsibility
    The Federal Government's responsibility, originally defined in 
Public Law 81-874 in 1950 and restated in Public Law 103-382 in 1994, 
is ``to provide financial assistance for those local educational 
agencies upon which the United States has placed financial burden.'' 
The original intent of Public Law 81-874 was to establish a mechanism 
for consistent funding of the Government's obligation to these 
districts and the children they serve. It provided a payment equal to 
the local per-pupil costs for students whose military parent both lived 
and worked on a federal installation (these students were designated A 
students) and one-half of the local per-pupil cost for students whose 
military parent worked on a federal installation but lived in the 
civilian community (B students). Under the current law, revenue for a B 
student is 10 percent of that for an A student. It costs roughly $6,000 
to educate a child in the United States today. But the current average 
Impact Aid payment for an A child is $2,000; the average payment for a 
B child is $200, nowhere near the original intent or the cost to 
educate a child.
    Although the Federal Government has acknowledged its responsibility 
to provide Impact Aid, the program has not been fully funded since 
1970. Even with much-appreciated Department of Defense supplemental 
funding for the most heavily-impacted districts, Impact Aid does not 
cover many districts' basic needs (A DOD Supplement of $35 million was 
authorized for fiscal year 1998, but not appropriated.). Local and 
state taxpayers continue to bear part of the burden for federal 
students. In the State of Washington, for example, Impact Aid funds 
only 23 percent of the cost of educating a federal student. The 
citizens of Washington fund the remaining 77 percent through local and 
state taxes.
    The fiscal year 1998 Impact Aid appropriation of $808 million was 
generous by the standards of previous years. We know that the increase 
will enable districts to serve military children more effectively. 
Continued consistent funding at or near the authorized level will help 
these districts wrestle with increased salaries and benefits for 
quality teachers, rising special education and transportation costs, 
and the demands of equipping schools and classrooms with the latest 
technology. Impact Aid funds help these districts approach the level of 
educational opportunity available in neighboring, non-impacted school 
districts even though they do not have access to the same kind of tax 
base.
    The Central Union School District in California, with 1,850 
students in four schools, provides a wonderful example of how districts 
use Impact Aid funds to keep pace with others in their state. The 
district earmarks its DOD Supplemental funds for technology. Internet 
access in all schools has enabled military students living on base at 
the Lemoore Naval Air Station to communicate with their parents on sea 
duty.
                  needs of heavily-impacted districts
    One of the greatest needs faced by heavily-impacted districts is 
for construction funds. The photos in Attachment A of this statement 
illustrate some typical construction needs, caused by the influx of new 
students, postponed maintenance, the demands for new technology, and 
normal wear-and-tear in buildings long-overdue for renewal and 
renovation. The reduced tax base caused by the presence of a large 
military installation often makes it difficult for these districts to 
float construction bond issues or take advantage of states' offers of 
matching funds.
    South Kitsap (WA) High School serves children of military members 
stationed at Bangor Submarine Base. Overcrowded and with the largest 
enrollment in the state, South Kitsap cannot get a bond issue for a new 
school or pass a levy to help pay for portables.
    The State of California recently allocated $1.6 million to cover 
one-half of the Central Union School District's costs of modernizing 
the two on-base schools. But how could the district ask the parents of 
the six hundred students who live off-base to pass a bond issue raising 
their own property taxes to modernize schools for children whose 
parents do not pay property tax? Central instead used its Impact Aid 
funds--"property taxes'' from the Federal government for the land it 
owns--to create a special reserve so that the district's 50 percent 
share would be available when the state funds were released.
    Routine repairs and maintenance are often deferred when districts 
need to buy textbooks or pay teachers. But safe, structurally-sound 
buildings are essential for education. Listen to a student's 
description of lunch at Vandan High School in the Travis Unified School 
District in California:
    When it rains at Vanden, the driving winds and stinging rains are 
unbearable; and I have nowhere to eat. For every student that can find 
space to sit in the cafeteria, there are three of us who must suffer 
the tumultuous elements. And because of El Nino this year the rains 
will come harder and longer; and the winds will be more fierce. I 
should like to invite you to have lunch with me on a day with 
torrential rains and 30 mile an hour winds. I guarantee that you will 
have an enlightening experience. If you can't make it for lunch, 
perhaps you'd send your 15 year old daughter. (``A Voice for the 
Unheard,'' by Trecia Pottinger, Student Board Representative, Travis 
Unified School District, speech given at meeting of National 
Association of Federally Impacted Schools, October 1997)
                   what's ahead for fiscal year 1999?
    The Administration has requested $696 million dollars for Impact 
Aid in fiscal year 1999, $112 million dollars less than Congress 
appropriated for fiscal year 1998. We are concerned that the 
Administration has not requested any money to help heavily impacted 
districts such as the Travis United School District with construction, 
repairs, and maintenance. And, once again, the Administration proposes 
to cut funding for the military B students, the children of military 
members living in the local civilian community. The authors of the 
first Impact Aid legislation recognized that the greatest burden for 
school districts serving military children would be when the military 
parent both lived and worked on a federal installation. However, they 
understood that the military B children also created costs to the 
district beyond what it would collect from the payment of some taxes. 
Local property taxes fund a declining share of a district's education 
expenses. States contribute more than ever to elementary and secondary 
education. In many states, local governments receive state allocations 
based on local property taxes, putting districts with large areas of 
nontaxable federal land at further disadvantage. Many other taxes used 
by state and local governments to support schools, such as personal 
property taxes, license fees, and state or local income taxes, are not 
paid by military members unless they happen to be residing at their 
legal domicile. Every time military families shop at exchanges and 
commissaries on the installation, states and localities lose sales tax 
revenue which could have gone to support schools.
    The notion that only children living on base pose a financial 
burden on school districts is disconcerting to NMFA and its members who 
have witnessed the impact large numbers of transient military children 
can have on a district even when their parents pay real estate taxes. 
NMFA believes that continued funding for B students is even more 
essential now that the Department of Defense is privatizing military 
family housing at many installations. As this Subcommittee considers 
the funding needs of federally-impacted school districts this year, we 
ask that you continue to recognize this Federal responsibility, as 
first articulated in P. L. 81-874, to provide funding for the military 
children living off the federal installation.
    We note that, in its fiscal year 1999 education proposals, the 
Administration is requesting several new programs to the long list of 
current federal education programs. Most of these programs target funds 
to specific needs or to supplement basic education in school districts 
which meet the eligibility requirements for that program. Impact Aid is 
different. Impact Aid dollars are targeted to districts where the 
Federal responsibility is the greatest under the law. The dollars go 
directly to school districts with no strings attached. The Newport News 
(VA) school district uses Impact Aid funds as part of its general 
operating fund. Other districts focus on reducing class size, upgrading 
technology, making building repairs, or continuing special programs. In 
each of these districts the local community, the people who have the 
greatest stake in the quality of education in their schools, decides 
how Impact Aid funds will best serve the basic education needs of all 
students.
                       serving the military child
    Until recently, local districts generally made decisions about how 
to use their Impact Aid funds and what programs and policies to adopt 
based on purely local needs. When the school officials responsible for 
educating military children got together, they talked of how to secure 
better Impact Aid or DOD funding or how to educate public officials 
about the importance of Impact Aid. Gradually, however, these educators 
began to acknowledge that educational issues affecting military 
children often transcend local needs. Military children are everybody's 
children! The quality of education a military child receives in the 
California school she attends in 1st grade, for example, will affect 
the education she and her classmates receive in the North Carolina 
school she attends in 4th grade. Children whose schools are unable to 
provide the necessary educational services could easily fall behind 
their peers in other districts. A smooth transition into their next 
school, whether across the state or across the country, benefits 
military children and their new classmates.
    In June 1997, some of the people who educate ``everybody's 
children'' participated in the First Annual Supporting the Military 
Child Conference sponsored by the Killeen (TX) Independent School 
District and Fort Hood. Participants identified critical issues 
involved in the transitioning of military students such as emotional 
and social support for the child, records transfer and proper 
placement, parental involvement, and communication. They offered 
recommendations on how districts could address these issues through 
technology, the sharing of information, the formation of partnerships 
between districts and military installations. They especially 
emphasized the need for continued communication between all school 
systems serving military children.
    To build on the foundation begun at the Killeen/Fort Hood 
conference, the Groton (CT) Public School district began plans for a 
national conference on ``Serving the Military Child'' to be held 
October 1998 in Arlington, VA. In order to involve even more districts 
educating military children, members of the planning committee for this 
conference come from several states and represent all branches of the 
Armed Services. The conference has already attracted support from the 
Departments of Defense, Education and Transportation and Members of 
Congress. General Henry H. Shelton, Chairman of the Joint Chiefs of 
Staff, has indicated that he will participate in the opening session of 
the conference.
    Organizers of the upcoming conference have agreed that one of their 
goals is to establish a new Military Child Education Coalition, whose 
mission is ``to promote partnerships and provide for networking of 
military installations and their supporting schools for the purpose of 
establishing systems and developing processes which address transition 
and other educational issues related to the military child.'' Convinced 
of the necessity for an organization focused on the educational needs 
of military children, the Killeen School Board recently voted to fund 
start- up costs for the coalition. The coalition would be open to all 
school systems serving military children, from the Department of 
Defense Schools, to the heavily impacted, to those with just a few on a 
small installation.
    To military parents, the idea of a coalition dedicated to the 
education and transition needs of military children is a wonderful 
thing. It is exciting to imagine that all the school systems which 
might ever educate our children are talking to each other about how 
they can do a better job. The educational focus of the Military Child 
conferences and Coalition demonstrates the effectiveness of the Impact 
Aid program. When the Federal government fulfills its responsibility to 
provide funding for basic education to districts serving military 
children, the districts can concentrate on creating a high-quality 
educational program for all students. They can create partnerships with 
other school systems and military commanders to look out for the 
educational needs of the military children they serve. We urge you, the 
Members of this Subcommittee, to be active partners in the education of 
military children and their civilian classmates and fully fund Impact 
Aid.
                                 ______
                                 

                            RELATED AGENCIES

Prepared Statement of Howard K. Ammerman, Ph.D., on Behalf of the U.S. 
                           Institute of Peace
    Thank you for the opportunity to present this testimony. These 
views are expressed as those of an interested citizen with a background 
in economics who has supported the United States Institute of Peace 
[USIP] since its inception and who is very apprehensive concerning the 
scourge of war.
    With a budget of slightly more than $11 million for the current 
year, the United States Institute of Peace is asking for an increase to 
$12.6 million for fiscal year 1999. To me, the total budget of the 
Institute is too small anyway, so I certainly support this increase. 
With the additional funds its present program in Bosnia could be 
pursued more intensively.
    At this point in time, perhaps we need to be reminded that the 
Institute of Peace is a unique agency with its creation being the 
culmination of about two hundred years of effort. The very persistence 
of efforts to bring this about indicates a perceived gap in our dealing 
with the matter of conflicts among nations and a belief in the 
possibility of improving our performance. One figure observed recently 
for world deaths due to wars in the present century was 110 million and 
of these figures, 2 million were children killed in the past decade. 
Another total figure cited was considerably higher, and casualties 
among children seem to have increased rapidly in recent decades. Do we 
need to be reminded that drastic changes need to be made in our 
patterns of human behavior, and in this case, particularly in 
international relations or domestic conflicts that threaten to spill 
over into the international realm?
    In Bosnia at the present time the Peace Institute finds itself 
involved in a post- conflict situation and directing its efforts toward 
helping those affected to follow through with an existing peace 
agreement. Matters of concern include such problems as transitional 
justice, political restructuring, the role of religion in conflict, and 
conflict resolution training. The work of the Institute serves to 
augment the work of other government agencies, but is some cases the 
Institute is doing work no other agency has the competency to do. This 
has been a natural extension of the work the Institute has been doing 
over the years. The Institute Board charged the staff to explore ways 
that its past work might contribute to peace building in Bosnia once 
the Dayton Accords had been signed. And it might be well to remember 
that on that Board are representatives of the Department of State and 
the Department of Defense.
    Yet it seems to me that there is still great resistance to even the 
acceptance of the idea of an Institute of Peace. It may be gaining more 
attention abroad than in the U.S. One way to give more credence to the 
Institute is to increase its appropriations. In perspective, I consider 
its budget figure to be trivial. So, let's not stop at its requested 
$12.6 million, but add at least another million, for the Institute has 
built a base on which it can expand readily into other promising 
endeavors. Personally, I am disappointed Congress did not appropriate 
funds for construction of a headquarters building for the Institute; 
however, in raising the funds by public subscription the Institute will 
become better known to the general public. But in anticipation of 
having its own home, a budget figure such as it now has to me would be 
ridiculously low.
    Because of this lack of attention to the Institute of Peace it may 
be well to consider the background for justifying the creation of such 
an agency even when this means repetition of previously submitted 
testimony. The Institute must spend at least 25 percent of its budget 
for research, but it is also greatly committed to the application of 
knowledge to specific problems of social relations and in the process 
of such applications gaining useful experience and insights 
transferable to other cases. The President of the Institute, a former 
Foreign Service Officer, pointed out the need in Bosnia to move beyond 
the research and the academic to application. In Bosnia the Institute 
may well be doing some pioneering in this complex situation.
    Recently the Hubble Space Telescope was described as, ``The most 
expensive and complex scientific instrument ever''. Without in any way 
deprecating this effort to learn more about the universe we may ask 
when are we going to make a comparable effort to learn more about the 
problems of human behavior on our planet? Rightfully, we make great 
efforts to learn more about that scourge of the human body, cancer. 
What about that cancer of the body politic, war? Perhaps the words of 
Thomas Jefferson may be of some help in this context--
    ``I am not an advocate for frequent changes in laws and 
constitutions, but laws and institutions must go hand in hand with the 
progress of the human mind. As that becomes more developed, more 
enlightened, as new discoveries are made, new truths discovered, and 
manners and opinions change, institutions must advance also to keep 
pace with the time. We might as well require a man to wear still the 
coat which fitted him as a boy as a civilized society to remain ever 
under the regimen of their barbarous ancestors.''
    Along with our ability to create, we human beings have the capacity 
to destroy, or shall we say, to engage in creativity for destructive 
purposes. Aren't there good reasons to be appalled by the danger of 
nuclear weapons and the disservice to humankind in strewing landmines 
over some 70 countries? At the same time, there are grounds for dismay 
at the comparative timidity of our efforts toward constructive 
creativity in developing a science of peach and a technology for 
achieving and maintaining such in international relations.
    Rather, we tend to underestimate the dangers of our weapons of 
violence and destruction and to belittle our potentials for, and the 
urgency to develop, effective methods of nonviolent resolution of 
conflicts. This is not to overlook the great contributions made by 
scholars in the study of the causes of war and the avenues to peace but 
to emphasize the relative efforts made as compared to that given to the 
development of instruments and tactics for war. Furthermore, there are 
estimates that the lag between the appearance of an article in a 
professional journal and the possible uses of some of the ideas 
presented in policy determination may be as long as 30-40 years. But it 
has been said that, ``The world can not long continue to wage war like 
physical giants and seek peace like intellectual pygmies''.
    On a broader basis, technological developments growing out of the 
physical and natural sciences are moving rapidly ahead and are not 
waiting for the behavioral sciences to catch up. International economic 
interdependence is also increasing. So the global village concept is 
becoming more and more of a reality. It is within this context that the 
need for peaceful resolution of conflicts become all the more 
important. And it seems to me the challenge lies in developing a 
science of peace. As remarkable as the contributions of the physical 
and natural sciences have been, and probably will be, to the betterment 
of human life, in my opinion our ultimate fate lies in the area of the 
behavioral.
    The USIP is a unique institution in our national history and 
congressionally was the outgrowth of what was intended to be a National 
Peace Academy. The commission set up to consider the possible creation 
of such an academy stated in its report, ``The Commission uses `peace' 
forthrightly in its discussion the Commission rejects emphatically any 
insinuation that peace--any more than love, church, justice, family, or 
flag--is soft or naive. The commission believes that timorous attitudes 
toward peace do not advance the national interest or reflect the 
American Character. Peace is neither utopian nor a sign of weakness or 
cowardice. Peace is not simply to be measured by an absence of tension 
or a quietude of complaint. Peace is not only a desired state; it is a 
process that is vigorous. The Commission finds that peace is a 
legitimate field of learning that encompasses rigorous 
interdisciplinary research, education, and training directed toward 
peacemaking expertise''. In pursuing such learning can we assume that 
despite our being such complex and diverse creatures we still have more 
in common than we have differences? Isn't there a contradiction in 
directing some of our best minds toward the creation of more 
``efficient'' weapons of violence? Can we do less than give our best 
efforts to achieve more effective ways to resolve our conflicts 
peacefully?
    Psychiatrist Vamik D. Volkan, in his ``The Need to Have Enemies and 
Allies,'' sees the need for enemies as the embodiment of what we do not 
wish to become. They are standards by which we can measure our own 
``higher level'' goals. It has been speculated that were our planet to 
be invaded from Mars, for example, we would quickly put aside our 
differences to engage the common enemy. But isn't it possible we on 
earth already have common enemies? After all, national boundaries are 
often very artificial limits. What about problems of the environment, 
greenhouse effect, poverty, and hunger? Can these be said to constitute 
common enemies? And wouldn't common efforts to ameliorate these 
conditions do much to make us allies? Without succumbing to self 
conceit can we say as human beings we have plumbed the depths of our 
combined and coordinated potentials for dealing effectively with these 
common problems?
    Looking hard for alternatives to violence in human relations at any 
level is intellectually stimulating. And all the more so because it 
involves a comprehensive effort to achieve positive and lasting 
results. In conflict resolution terms, this is a striving for ``win-
win'' solutions. The extent of our funding for the USIP raises 
questions as to how seriously we take the efforts to achieve peace. 
There seems to be a very limited value placed on what some of the best 
minds in our country, and others, might accomplish. Isn't there a 
contradiction in directing some of our most talented toward the 
creation of ever more ``efficient'' weapons of violence? Can we do less 
than give our best efforts to achieve more effective ways to resolve 
our conflicts peacefully? Put another way, the relative amounts 
appropriated for the USIP as compared to those for instruments of 
violence tell a story. Is this a story with which we can or should be 
comfortable? To be sure, programs of research, education, training, and 
dissemination of information pertinent to peace-making can be done at 
much less cost than developing some of our most sophisticated weapons 
of violence, but can we expect sheer miracles?
    In conclusion, isn't there an element of escapism, if not 
irresponsibility, in the ``always has been and always will be'' 
generalization? Would we not be in default in the application of our 
collective mental capacities if we take this view. But to avoid this 
will require much more widespread and intensive efforts on our part 
than we have made in the past. It would be shortsighted to look at the 
dangers and difficulties in human relations today without also 
recognizing the opportunities for good. The United States Institute of 
Peace, in one of its publications, has made this stimulating comment, 
``We are not looking for a revolution in human nature, we are looking 
for an evolution in human institutions.''
                                 ______
                                 
    Prepared Statement of Harris Wofford, Chief Executive Officer, 
                    Corporation for National Service
    Mr. Chairman and Members of the Subcommittee, I appreciate the 
opportunity to review the achievements of national service over the 
last year and inform you about our programs and proposed budget.
    I want to express my appreciation to the Subcommittee for the 
increases it provided last year. I know that you must sort between 
competing claims and make tough decisions with scarce resources. I 
believe that AmeriCorps*VISTA and Senior Corps have always been good 
investments, and I am firmly convinced that they merit your support 
today, more than ever. The Senior Corps and VISTA have a long tradition 
of involvement in our communities, improving education, bettering the 
health of children, promoting independent living and economic self-
sufficiency, and harnessing the power of people in communities in every 
state in America.
    The total fiscal year 1999 budget request to the Subcommittee for 
programs authorized under the Domestic Volunteer Service Act is $278.4 
million, an increase of $21.8 million over the fiscal year 1998 
appropriated level of $256.6 million. The request for the National 
Senior Service Corps programs is $173.9 million, including $43.3 
million for the RSVP, an increase of $3 million, $94.1 million for the 
Foster Grandparent program, an increase of $6.6 million and $35.4 
million for the Senior Companion program, level funding from last year. 
The request for AmeriCorps*VISTA is $73 million, an increase of $7.8 
million.
    These funds would provide program support for 5,500 
AmeriCorps*VISTA member service years and almost 500,000 in the 
National Senior Service Corps--including approximately 462,500 in the 
Retired and Senior Volunteer Program (RSVP), 23,450 Foster 
Grandparents, and 8,600 Senior Companions. The requested budget for 
fiscal year 1999 would provide for an increase of 620 AmeriCorps*VISTA 
member service years and 8,800 Senior Corps service years. (The other 
programs of the Corporation for National Service, including AmeriCorps 
grants, the National Civilian Community Corps, and Learn and Serve 
America, and the Corporation's Office of the Inspector General are 
funded through the Subcommittee on VA, HUD, and Independent Agencies.)
                           cost effectiveness
    After three decades and the service of over 120,000 men and women 
at 15,000 local projects, VISTA (Volunteers in Service to America) 
today remains vibrant and vital. Now a part of the AmeriCorps network 
of national service programs, VISTA continues its mission of building 
community capacity, breaking the bonds of dependency, and creating 
self-reliance among low-income people.
    AmeriCorps*VISTA strengthens community-based organizations by 
expanding the capacity of local organizations to recruit, train, and 
coordinate local volunteers whose efforts continue in communities long 
after the VISTA members leave. Through these capacity-building 
partnerships, AmeriCorps*VISTA members help to expand affordable 
housing, create job opportunities, make health care more accessible, 
develop literacy activities and enable local citizens to live in safer 
neighborhoods.
    AmeriCorps*VISTA is cost-effective. The living allowance and other 
support costs provided for each AmeriCorps*VISTA member total less than 
$13,400 per year. For every appropriated dollar spent on 
AmeriCorps*VISTA, $3.33 is returned to the community in the form of 
financial and in-kind resources and local volunteers generated by 
AmeriCorps*VISTA members for their projects. According to the most 
recent accomplishments study conducted by WESTAT Inc. and completed in 
April, 1998, AmeriCorps*VISTA members raised $82 million in cash and 
in-kind resources for their projects, and recruited and coordinated 
140,600 local volunteers who provided more than four million hours of 
service. On average, each AmeriCorps*VISTA member recruited 42 
community volunteers and generated $24,350 worth of resources.
    In 1997, 25,300 Foster Grandparents served through 305 projects in 
all 50 states, the District of Columbia, Puerto Rico and the Virgin 
Islands. These Foster Grandparents served more than 175,000 children. 
Foster Grandparent projects are jointly funded by Federal, state, and 
local governments, with significant support from the private sector.
    In 1997, the 24 million hours of service provided by Foster 
Grandparents were valued at more than $315 million based on an 
assessment service conducted by the Independent Sector and the Gallup 
Organization that assumes $13.24 an hour to calculate the value of 
volunteer. This represents more than a four-fold return on the Federal 
dollars invested in these projects.
    The majority of children served by Foster Grandparents are young--
ages birth through 12. Almost 14,000 Foster Grandparents help children 
with physical and mental impairments, about 4,000 help children who 
have been abused, abandoned, neglected, or are homeless, and some 2,000 
help juvenile offenders or children with substance abuse problems.
    RSVP volunteers provide hundreds of community services. They tutor 
at-risk youth, computerize information systems for community health 
organizations, get children immunized, teach parenting skills to teen 
parents, provide respite for caregivers of Alzheimer's victims, 
establish neighborhood watch groups, plan community gardens, and 
perform a myriad of other community services. Through such efforts, 
RSVP is meeting community needs that strained local budgets cannot 
afford to address.
    In 1997, approximately 450,000 RSVP volunteers served in 751 
projects sponsored by local public and private nonprofit agencies. RSVP 
volunteers contributed over 74 million hours of service to their 
communities in approximately 1,400 counties nationwide. These projects 
are jointly funded by the Federal Government, state and local 
governments, and the private sector. The 74 million hours of service 
provided annually by RSVP volunteers have an estimated value of over $1 
billion; approximately a 30-fold return on the Federal dollars invested 
in RSVP.
    In 1997, almost 14,000 Senior Companions served approximately 
37,000 frail adults through 191 projects sponsored by local public and 
private nonprofit agencies. These projects are jointly funded by the 
Federal Government, state and local governments, and the private 
sector.
    In 1997, the 12 million hours of service provided by Senior 
Companions were valued at $156 million; representing more than a five-
fold return on the Federal dollars invested in Senior Companion Program 
projects.
                    getting things done in education
    Education has long been a central focus of the Senior Corps and 
AmeriCorps*VISTA programs. The challenge to have all children reading 
well and independently by the end of the third grade requires a 
mobilization of appropriately-trained reading tutors and partners from 
all walks of life, working closely with teachers and schools to enhance 
children's learning. AmeriCorps*VISTA has already begun to meet this 
challenge by committing members to recruit, screen, train, and place 
community volunteers--students, members of the business community, 
teachers, administrators, parents, PTA members--as reading tutors and 
mentors.
    RSVP and the Foster Grandparent Program have been involved in 
children's literacy efforts since their inception. In the 1980s this 
focus was solidified in a multi-year partnership with B. Dalton 
Booksellers, Laubach Literacy, and the National Association of RSVP 
Directors to fund, train, and provide the technical assistance 
necessary to establish the RSVP Literacy Network. The Network 
eventually included over 75 percent of the local RSVP projects. In 
1996, more than 35,000 RSVP volunteers provided over 1.8 million hours 
of education-related services to children and youth. By 1997, the 
Foster Grandparent Program was serving in over 3,100 schools and 1,200 
Head Start programs. RSVPs served over 5,400 schools, 2,200 libraries, 
1,100 Head Start/pre-schools, and 4,500 other educational settings. In 
1997, the Corporation funded 265 local RSVP and FGP projects to support 
an additional 3,300 volunteers providing reading assistance to children 
in Head Start, schools, out of school tutoring programs, family 
literacy programs such as Even Start.
    In 1997, the Corporation funded 25 new Foster Grandparent Program 
local projects with a strong child literacy component. These new Foster 
Grandparent projects are expected to increase the level of effort in 
child literacy by 1,055 volunteers, reaching an estimated 3,700 
children nationwide.
    In 1997, the Corporation also launched a new national demonstration 
program, Seniors for Schools, to mobilize the talent, experience, and 
resources of senior volunteers as literacy and reading resources to 
public school children in kindergarten through third grade. Two-year 
grants were awarded to projects in Florida, Massachusetts, Minnesota, 
Missouri, New York, Ohio, Oregon, Pennsylvania, and Texas. As of 
December 1997, more than 200 Seniors for Schools volunteers were 
tutoring, strengthening reading skills, increasing parental 
involvement, and planning special projects with more than 1,100 
children from 23 public schools.
    The Southeast Foster Grandparent Program of Monticello, Arkansas, 
began participating in child literacy activities with four public 
elementary schools in the fall of 1997. Sixteen Foster Grandparents 
received training as literacy tutors and were placed in the schools. 
Mid-year teacher evaluations, collected in January 1998, showed 77 
percent are making noticeable progress.
    In Durham, North Carolina, 73 RSVP volunteers served in elementary 
schools as reading tutors to 146 students who were reading below grade 
level. At the close of the 1996-1997 school year, five schools being 
served by RSVP volunteers met their reading goals, while six schools 
using RSVP volunteers exceeded their goals. An annual state reading 
test for third graders found that in 1996-1997, 65.2 percent of the 
tutored students were reading on grade level, a 33.3 percent increase 
from the previous year.
    In Laurens, South Carolina, the County Family Education Center is a 
collaborative effort of the local literacy council and the public 
schools to provide an education program for disadvantaged parents and 
their pre-school children. Parents attend classes on adult literacy and 
parenting skills, and participate in PACT (Parent and Child Together) 
time in which teachers and Foster Grandparents model positive 
discipline techniques, language enrichment, and appropriate feeding/
diapering techniques to the parents. Three Foster Grandparents are 
assigned to assist two preschool teachers using developmentally and age 
appropriate materials and practices for nurturing growth and 
development of 23 individual children. The Foster Grandparents served 
the children and their parents 20 hours per week for a total of 1980 
hours of direct service. The Center staff indicated that objectives of 
the Center were met in that 91 percent (goal 80 percent) of the 
children assessed have indicated growth in age-appropriate development 
tasks and 82 percent (goal 75 percent) attended parenting sessions.
    In Buhl, Idaho, Foster Grandparents provide literacy services to 
the children of Popplewell Elementary School where 40 percent of the 
students read below their grade level. Foster Grandparents help 
kindergarten and first grade students with word recognition and 
writing; serve in the library, assisting students of all grades to read 
aloud; help fifth graders whose first language is not English with 
reading comprehension; and engage students in all grades in creative 
writing and storytelling.
    Foster Grandparents served 16 River Valley School, Iowa students 
with disabilities. As part of a summer reading program, Foster 
Grandparents and students were paired for 30 minutes and took turns 
reading aloud to each other. The group cumulatively read 112 books over 
the course of the summer. Students were assessed at the beginning of 
the summer to determine their abilities and interests, then weekly 
records monitored their attentiveness, enjoyment and attitude during 
the reading program. The weekly assessments demonstrated that 79 
percent of the students rated excellent in attentiveness; 84 percent 
rated excellent in attitude and behavior; and 100 percent wanted to 
continue in the summer reading program next year.
    In Springfield, Missouri, 90 percent of students at Fairbanks 
Elementary School are eligible for free or reduced lunches. Students' 
scores on standardized tests and attendance are consistently below the 
district average. The school also has one of the highest percentages of 
single parent families, with very low parental involvement. Twenty-one 
RSVP volunteers were recruited to work one-on-one with a specific child 
in first or second grade for approximately 45 minutes per week at 
breakfast or lunch for the entire school year. The reading teacher 
prepares packets with suggested books and activities specific for each 
child each week. According to reading teachers and the principal, 
children served by volunteers are already beginning to showing improved 
reading skills and attitudes towards reading.
    In 1997, AmeriCorps*VISTA members serving in more than 300 
education projects established or expanded adult and child literacy 
programs; conducted outreach campaigns to enroll individuals in GED or 
high school diploma equivalency programs; recruited, trained, and 
coordinated volunteer tutors; gathered books, supplies, and cash 
donations to sustain programs; and built school and community 
partnerships that will continue long after the VISTA members leave. 
Over the past two decades, AmeriCorps*VISTA has provided support for 
adult, family, and child literacy programs conducted by organizations 
such as the Literacy Volunteers of America, Laubach Literacy Action, 
and Communities in Schools. In all of these cases, VISTA members 
provide support to enable these organizations to more effectively carry 
out their education model.
    In Pennsylvania, AmeriCorps*VISTA members recruited volunteers and 
raised the funds necessary to allow the Adams County Literacy Council 
to survive financially and provide effective one-to-one tutoring to 
adult nonreaders. VISTA members have established interactive programs 
with local school districts, Harrisburg Area Community college, and 
Gettysburg College. One VISTA member single-handedly conducted the 
first ``Buck a Book'' campaign in which area children enlisted sponsors 
for each book they read in a one week period. The campaign brought in 
$19,500 to the program.
    The Oregon Children's Foundation's SMART programs encourage and 
support reading among children in kindergarten through second grade. 
Thirty-two AmeriCorps*VISTA members have recruited and trained more 
than 4,000 local volunteers in 78 schools to read to children, educate 
the public about volunteering, develop public-private partnerships and 
mobilize community resources. Private sector support comes from over 
350 companies including Nike, Intel Corporation, Smith Barney and Wal-
Mart.
    In Kentucky, the Laurel County Literacy Council expanded its VISTA 
project activities to include five nearby counties. Since then, VISTA 
members have concentrated their efforts on resource mobilization. For 
example, the counties received a $17,500 grant from the KY Department 
of Adult Education and Literacy to purchase laptop computers in each of 
the five counties. A VISTA member in Bell County created ``Little 
Bird'', a new program that will distribute books to each parent of a 
newborn upon their release from the local hospital. As a result of the 
VISTA members, the Literacy Council received a $10,000 grant from NY 
Life Foundation to support student transportation and an additional 
instructor.
                     improving health and nutrition
    Senior Corps and AmeriCorps*VISTA programs also focus heavily on 
the health and nutrition needs of Americans of all ages. 
AmeriCorps*VISTA members assigned to nearly 150 projects have 
established or expanded 170 immunization programs which have immunized 
more than 47,000 children and adults, provided 155,000 individuals or 
families with health information or educational materials, and 
established or expanded 90 food banks. The Senior Companion program 
focuses on the needs of the frail elderly, while Foster Grandparents 
work with children who have physical, educational, or emotional 
disabilities.
    In 1996, almost 300,000 families and 108,000 individuals received 
health care services from RSVP volunteers. RSVP volunteers assisted in 
serving more than 23 million meals. In 1997, Foster Grandparents 
provided service to 5,600 children with developmental disabilities, 
2,700 children with emotional impairments and 4,500 children with a 
variety of physical disabilities. RSVP serves 4,300 hospitals and 
clinics, 6,000 nursing homes, 2,500 other long-term care facilities, 
and 900 home health care agencies.
    In Pennsylvania, AmeriCorps*VISTA members serving the Greater 
Philadelphia Food Bank, raised over $150,000 through the Check Out 
Hunger Program. VISTA members also helped establish ``The Greater 
Philadelphia Anti-Hunger Coalition,'' a self-sustaining network of 
agencies to enable feeding charities to function more efficiently. As a 
result of VISTA efforts, over 500,000 pounds of food annually is made 
available to those in need. By helping to develop the resources to 
obtain a delivery vehicle, VISTA members have enabled the Food Bank to 
extend its delivery to include a 150 mile radius of the city.
    The Northwest Arkansas Free Health and Dental Clinic in 
Fayetteville serves the needs of a low-income population. 
AmeriCorps*VISTA members designed and implemented a dental education 
program for children. Members recruited six dentists to work in the 
dental clinic, implemented an appointment system, secured donations of 
supplies and pharmaceuticals and recruited community volunteers to 
assist in the dental clinic's operations. One member secured a $40,000 
grant from the Foundation of the Mid South that will sustain the 
operations of the children's dental program.
    According to statistics from the Alzheimer's Association, an 
estimated 1 in 10 persons over 65 and nearly one-half of those over 85 
have Alzheimer's disease. Most of those people live at home. Almost 75 
percent of the home care is provided by family and friends; however, 
the remainder is paid care costing an average of $12,500 per year--to 
many, a prohibitively expensive amount. To help meet these care giver 
needs, volunteers from the Senior Companion Program of Harrison County 
provided almost 10,000 hours of in- home services to Alzheimer's 
patients in Ellisville, MS. Senior Companions assist with daily living 
activities, provide companionship to their client, and respite 
assistance to the caregiver. By helping people to live independently, 
Senior Companions help seniors avoid the $38,000 average annual nursing 
home costs.
    In Hawaii, the Senior Companion Program expanded to Oahu's Leeward 
Coast to address the health needs of the homebound elderly. This remote 
area of the island is economically depressed and public transportation 
is poor. Senior Companions were assigned to a health care agency to 
provide personal care, home management, and social support for in-home 
caregivers. Five Senior Companions provided over 3,000 hours of service 
to 10 clients. As a result, the State has saved a minimum of $16,800 in 
nursing care for one year for each of the ten clients.
                     creating economic opportunity
    AmeriCorps*VISTA is helping to move people from welfare to work. 
VISTA members assigned to 200 community economic development projects 
are providing training for many welfare recipients. In 1997, 
AmeriCorps*VISTA members identified more than 150 businesses across the 
country which agreed to hire welfare recipients and other unemployed 
people. AmeriCorps*VISTA members are also expanding microenterprise 
opportunities for aspiring entrepreneurs in low-income communities. In 
1997, members helped 430 individuals or businesses obtain development 
capital and helped establish or expand nearly 800 microenterprises.
    In Seattle, Washington, an AmeriCorps*VISTA member is assisting 
``Washington Works,'' an organization which places welfare recipients 
in paid employment. The VISTA member is assisting women who have 
succeeded initially confront child-care and transportation needs, skill 
training, and other potential obstacles which often prevent them from 
achieving long-term success on the job. Other AmeriCorps*VISTA members 
in Washington are working with the International Association of 
Machinists-CARES program to launch an employment program for people 
with AIDS.
    AmeriCorps*VISTA members serving with Working Capital--a community 
based organization in Massachusetts--are assisting micro and small 
business development in 20 economically distressed communities 
throughout the State. The project utilizes a unique peer lending model 
to provide loans, training, and support to microentrepreneurs.
    Through the work of the VISTAs in 1997, more than 1,000 businesses 
participated in and invested over $1 million dollars in the peer 
lending process. More than 200 microbusinesses have been created. The 
VISTAs play a vital role in recruiting potential business owners and 
assisting in the development of marketing strategies for Working 
Capital.
    In New Haven, Connecticut, two AmeriCorps*VISTA members with the 
Greater New Haven Opportunities Industrialization Center assisted in 
the creation of a ``Youth Mall'' to give young adults the experience of 
entrepreneurship and to create jobs for young people moving from school 
to work. At-risk youth participated in the training program in order to 
establish, own, operate, and manage a snack shop and clothing store. 
The snack shop is now fully operational with program participants 
running the shop. The initial phase of developing the clothing store is 
also underway.
    In Beloit, Wisconsin, AmeriCorps*VISTA members working for the 
Neighborhood Housing Services helped develop Homebuyers Clubs, 
developing a manual, creating and implementing working, and recruiting 
participants for this program to assist families in buying homes. 
Because of the VISTA members' help, the Housing Services has been able 
to continue and maintain this program. Currently, the Clubs meet on a 
monthly basis to work through the process of becoming homeowners.
    Thirty-two AmeriCorps*VISTA members are serving with 28 credit 
unions throughout the country through National Federation of Community 
Development Credit Unions. Members are developing Individual 
Development Account (IDA) programs, providing home ownership counseling 
and small and micro-business training. In the past 6 months, VISTA 
members have recruited 2,500 new credit union members and established 
eight youth credit union programs. Members have also helped to market, 
design, and implement 27 new programs or products to expand financial 
services to low income people such as IDAs, mortgage loans, small 
business lending, direct deposit, share accounts, and financial 
education seminars.
    RSVP has a long history of providing assistance to older people, 
and low income families and individuals. In 1996, almost 270,000 
volunteers contributed 9.8 million hours of professional or technical 
support services such as tax preparation or retirement planning. 
Approximately 528,000 families received assistance to alleviate 
problems related to homelessness.
    In St. Louis, Missouri, Senior Companions team with younger home 
care workers who are welfare-to-work transition single mothers placed 
through the Near South Side Empowerment Coalition to provide services 
to Medicaid recipients. The young workers allow the Senior Companions 
to better attend to the emotional and relationship needs of the 
isolated and elderly clients, while the young workers handle chore 
services and other needs.
               expanding effective and efficient service
    A major goal of both the Senior Corps and AmeriCorps*VISTA is to 
expand service opportunities while maintaining high-quality. We are 
achieving this goal through Programming for Impact, cost-share 
agreements, public/private partnerships, serving in Enterprise and 
Empowerment zones, and helping community-based organizations obtain the 
resources they need to sustain their operations after Federal support 
has ended.
Programming for impact
    After three decades of service, the Senior Corps is bringing a new 
vision into focus, shifting from a single focus on creating volunteer 
opportunities to a two dimensional approach of Senior and Service. This 
dual approach, which we call Programming for Impact, will position us 
to meet the challenges of the future and to establish existing programs 
as vehicles to harness the tremendous resource that the growing 
population of older persons can bring to addressing critical community 
needs. Senior Corps programs have proved that older volunteers are 
interested in serving and willing to serve, and that they do so 
impressively. We are now exercising leadership focusing on measurable 
benefits and outcomes realized from the efforts of the volunteers. This 
approach allows us to retain the best of the past while meeting the 
needs of the future.
    Programming for Impact is the implementation vehicle to help change 
the way the Senior Corps does business. It was developed to enhance the 
``service'' side of ``senior service'' by allowing projects to 
effectively assess community needs, engage volunteers in activities 
that relate directly to meeting the need, identify inputs and resources 
necessary, and set a basis for measuring accomplishments and changes 
that occur in the community as a result of the efforts of the 
volunteers.
    The Senior Corps is engaged in a thoughtful, deliberate and 
incremental implementation of Programming for Impact. The impact goals 
are reflected in the Corporation's Government Performance and Results 
Act plan, budget request, and program evaluation plan.
    In July 1996, the Senior Corps held a national conference, 
``Renewing America Through Senior Service,'' attended by all project 
directors who manage the more than 1,200 local Senior Corps projects. 
The directors were introduced to the nuts and bolts and rationale for 
these changes.
    From July 1996 through 1997, the Senior Corps developed pilot test 
sites, and held state impact training conferences as incremental steps 
to reinforce Programming for Impact, to experiment with implementation, 
and to develop state-specific State Programming for Impact 
Implementation Plans. These locally-driven plans, designed to engage a 
wide base of Senior Corps stakeholders, defined how states will phase 
in the application of Programming for Impact to all projects over a 15 
month period, during the period from July 1, 1997 through September 30, 
1998.
    In 1998, the Corporation worked to modify tools and systems needed 
to manage and guide Programming for Impact including the Senior Corps 
Grant Application and the Project Progress Report (to include reporting 
on Government Performance and Review Act). We are currently field 
testing a set of Accomplishment Surveys that will capture both the 
``inputs'' and ``accomplishments'' of Senior Corps projects in fiscal 
year 1999. As of July 1, 1998, Programming for Impact becomes the 
official approach for all Senior Corps projects with renewal dates of 
July 1, 1998, or later using the revised Grant Application.
                             sustainability
    A recent evaluation conducted by People Works, Inc. found that 
nearly 73 percent of AmeriCorps*VISTA supported programs continued to 
operate years after the VISTAs had completed their assignments. This 
reflects the self-help philosophy of AmeriCorps*VISTA whose goal is to 
increase the capacity of the communities to solve their own problems. 
Each sponsoring organization plans from the beginning to phase out 
AmeriCorps*VISTA resources after three to five years and to have the 
community take over and sustain those activities. AmeriCorps*VISTA has 
proven that it works.
    AmeriCorps*VISTA members who served with the Southern Development 
Foundation in Opelousas, Louisiana, introduced 75 farmers to sequential 
vegetable farming techniques and goat production. With the VISTAs' 
assistance, the farmers were able to realize a $3,000 to $5,000 per 
year increase in income with no significant increases in investment. 
The members established a Farmer's Market for the sale of participating 
farmers' produce which remains operational after AmeriCorps*VISTA 
resources have been removed.
    AmeriCorps*VISTA members who served with the Arkansas Disability 
Coalition organized 20 parent support groups in rural areas with high 
levels of poverty throughout Southeast and Northeast Arkansas. These 
groups advocate on behalf of children with disabilities to ensure that 
they get the services and support they need. VISTAs developed and 
institutionalized the ``Arkansas Meeting Plan,'' a listserve with over 
100 members ranging from individuals with disabilities and their family 
members to professionals in the disability field. This listserve 
provides information on changes in special education policy, notices 
for opportunities to participate in social activities, information on 
the changes to Medicaid, and other important issues. VISTAs were also 
able to secure computers for 40 families and ongoing training for 
interested persons.
    When Project VIDA AmeriCorps*VISTA in El Paso, TX, ended in 1996, 
it left a strong VISTA legacy in the community. Members developed an 
institutionalized reading development project as a piece of the after-
school component that has succeeded in increasing standardized reading 
scores in each of its last three years. The VISTA health education 
component spun out into a community health clinic with a thousand 
visits a year. The housing component continues to conduct the 
environmental clean sweeps, graffiti suppression, and a tenant rights 
education program. According to the program director, ``If it were not 
for the VISTA members, there would be no after school programs.* * * In 
housing, maybe the community would have been served another way, but we 
would be at least three years behind where we are today.''
Cost-share programming
    The AmeriCorps*VISTA program model has proven so successful that 
demand for AmeriCorps*VISTA members around the country exceeds the 
ability of federally appropriated dollars to provide them. However, as 
sponsoring organizations recognize the value of the VISTA resource they 
use their own resources on a cost-share basis to pay for basic member 
support costs while the Corporation provides the education award, 
training, and recruitment support. The number of members funded in this 
manner has risen from 560 in 1994 to more than 1,300 in fiscal year 
1998. More than 200 sponsoring organizations contribute $13 million to 
this effort.
    One example of a cost-share project making a difference is the 
State of Oregon's Health Division which has agreed to pay the basic 
expenses for 45 AmeriCorps*VISTA members. The members are located in 
almost every county in the state referring WIC and immunization clients 
to the Oregon Health Plan and publicizing the need for complete 
immunization. Because of the program, immunization rates in Lake County 
have increased from 57 percent in 1995 to 87 percent today; Lincoln 
County now has a new immunization clinic that is open in the evenings; 
the AmeriCorps*VISTA in Waso-Sherman County has regular monthly WIC/
Immunization features on local radio stations and monthly spots in 
local newspapers; and, in Baker County, there are only 22 children 
under age two with incomplete immunizations.
    Non-Federal funds also provide critical support to Senior Corps 
programs. In fiscal year 1997, the non-Federal local contribution to 
Foster Grandparent programs exceeded $32 million or 42 cents for every 
Federal dollar invested--well above the 10 percent matching share 
required by law. The non-Federal local contribution to RSVP projects of 
over $42 million, exceeding the Federal contribution, demonstrates 
broad support for RSVP across the country. For Senior Companion 
programs, the non-Federal local contribution was over $19 million. This 
non-Federal contribution represented a match of 61 percent, well above 
the 10-percent matching share required by law.
Public/private partnerships
  --AmeriCorps*VISTA is partnering with over twenty national 
        organizations including Big Brothers/Big Sisters, Communities 
        in Schools, Habitat for Humanity, Save the Children, Literacy 
        Volunteers of America, Laubach Literacy Action, National 
        Alliance to End Homelessness, and United Way of America to make 
        an impact on communities in the areas of adult and children's 
        literacy, education, technology, housing and homelessness, 
        among other issues.
    AmeriCorps*VISTA has a long history of service with Habitat for 
Humanity which shares VISTA's mission to help low-income individuals 
help themselves. There are more than 200 AmeriCorps*VISTA members 
throughout the country recruiting volunteers and garnering donations at 
40 Habitat for Humanity project sites. In Phelps, Kentucky, three 
AmeriCorps*VISTA members working with Phelps Habitat for Humanity 
mobilized tens of thousands of dollars in land, labor, and machinery. 
Members also recruited local volunteers and assisted the local 
communities in site plan development and family selection. Because of 
VISTA's involvement, Phelps Area Habitat now starts to build a new home 
every 6 weeks.
    AmeriCorps*VISTA has collaborated with IBM and United Way of 
America to create Team TECH. Through this partnership 55 
AmeriCorps*VISTA members are placed in 11 communities throughout the 
country to develop strong leadership and technological skills among 
nonprofit organizations serving the poor. They provide technology 
planning assistance, obtain funding for hardware and software, and 
provide computer training. During the past eight months, the Team TECH 
project has affected nearly 300,000 children providing $1.8 million in 
technology and technical services in the 11 communities served. These 
services provide children with direct access to new computers and 
software through after-school programs, daycare programs, education 
workshops, and mentoring programs.
    In Burlington, Vermont, AmeriCorps*VISTA members serving with Team 
TECH have brought technology and technology assistance to more than 650 
children in the Burlington Boys and Girls Club. The computers allowed 
the Vermont Job Bank to install education software, access to the 
Internet, and educational software, and set up a database of employment 
opportunities.
    AmeriCorps*VISTA has also partnered with Rural LISC (Local 
Initiative Support Corporation), an organization which provides support 
and easier access to technology services in rural America. Eight 
members are serving with four community development corporations in New 
York, Wisconsin, California, and Oklahoma. The purpose of the project 
is to develop websites to provide low-income individuals in rural areas 
access to public and private support in order to obtain decent housing 
and a range of services intended to help them remain in housing. Thanks 
to the Internet, more than 60 community development corporations 
affiliated with Rural LISC will ultimately benefit from this project. 
Rural communities will have a significant new tool to prevent 
homelessness and improve services to the rural homeless.
                           management issues
Program administration
    Program administration is authorized under Title IV of the Domestic 
Volunteer Service Act of 1973, as amended. For fiscal year 1999, the 
Corporation is requesting $31,512,000 for Program Administration. The 
requested funding will maintain necessary staffing for effective 
program oversight and to improve our financial control and reporting. 
Of the total, $22,231,000 will fully support 332 full-time equivalent 
workyears by staff providing direction, oversight, technical assistance 
and administrative services to programs nationwide. The remaining 
$9,281,000 will cover the cost of rents, supplies, communications, 
printing, contractual services, travel, transportation, and equipment.
Auditability
    Last year, I indicated that we expected to have 97 of the 99 items 
cited in the Corporation's 1996 auditability study completed and 
appropriately addressed by the time the Inspector General conducted her 
review during the spring and early summer of 1997. That auditability 
review showed that the Corporation had fully addressed 72 items. 
However, we fell short of the goal I stated last year. The auditability 
review found 21 material weaknesses and reportable conditions that had 
not been fully cleared. Since that report, we have successfully 
addressed 10 of these 21, have made significant and sustained progress 
on seven others, and have begun to address the remaining four. In the 
review, both the Office of the Inspector General and Arthur Andersen 
stated that the Corporation had demonstrated a commitment to correct 
the deficiencies and weaknesses.
    Our efforts on these auditability issues and our activities to 
establish strong financial management focus on five areas: (1) the 
maintenance of the growing number of paper records related to 
enrollments in the National Service Trust; (2) the timely 
reconciliation of cash; (3) improvement of controls over grants 
management; (4) improvement of budget and funds control; and (5) 
improvement of general financial control. We have had much success in 
each area. With important assistance from the Office of Management and 
Budget (OMB), we have developed a specific action plan with a timeline 
to remedy the remaining weaknesses identified in the July, 1997, review 
and to provide the basis for obtaining an unqualified opinion on the 
Corporation's Financial Statements for fiscal year 1998.
    The first area is the maintenance of the growing number of paper 
records related to enrollments in the National Service Trust. We will 
use digital imaging technology, which we expect to have in place in the 
current fiscal year, to enter new enrollments and aid in the resolution 
of any historical problems related to older records. This use of 
imaging technology will ensure the accuracy of AmeriCorps members' 
records for the future and facilitate the prompt correction of past 
errors.
    The second area of major effort is the timely reconciliation of 
cash. In our plan, remaining auditability items related to cash 
reconciliation will be successfully addressed by the end of August of 
this year. Interagency charges represent a special challenge. The 
timely posting of interagency charges is being addressed by OMB as part 
of a government-wide solution to the problem of an antiquated system 
for such charges. We will be among the first agencies to take advantage 
of new capabilities when OMB and the Department of the Treasury bring 
on-line the new capacity to identify sub-elements of interagency 
transfers.
    In the third area, grants management, we are improving the accuracy 
of Trust records by enhancing our oversight program. In addition, we 
are establishing practices to strengthen our record-keeping regarding 
grant receivables and payables, such as better recording and tracking 
of funds owed the Corporation following audits.
    With regard to the fourth area, budget and funds control, we will 
purchase and implement a new financial management system that will 
provide the capability to record commitments and obligations, thereby 
substantially increasing the effectiveness of controls. Meanwhile, we 
have adopted new procedures that protect against the over-obligation of 
grant funds.
    Improvement of other financial controls is the fifth element in our 
plan. This includes, among other things, strengthening procedures for 
ensuring the accuracy of VISTA stipend payments and improving financial 
reporting.
    While we continue to address these items, we have also made other 
important changes. Enhancements to our accounting and Trust systems 
have improved system security and data. We have issued policies and 
procedures for various financial management activities. New job 
descriptions have been written. Job duties have been segregated across 
our major financial functions. The staff supporting the operational 
activities of the National Service Trust have been consolidated into a 
single organization to improve management control.
The Government Performance and Results Act
    The Corporation is complying with the requirement of the Government 
Performance and Results Act (GPRA). We have met, and are meeting, all 
of the requirements of GPRA. Our strategic plan was submitted on time 
and in full compliance with the Act. We have distributed copies of the 
plan widely, throughout the national service community, and it is 
available on our Internet website at www.nationalservice.org. Our 
fiscal 1999 performance plan was sent to the Congress on February 20 
and soon it will be available through the Internet.
    The strategic plan and the performance plan lay out in clear terms 
our vision and goals, and the practical steps we will follow to get 
there.
    In addition, standards of program quality will be set for every 
area of national service. We will be creating indexes that can be used 
to rate objectively the quality of our programs. These indexes will 
combine data from many sources, including customer satisfaction and 
community impact ratings, into an overall assessment of quality. Every 
program area will be subject to what we call community impact ratings. 
In a national survey, we will be asking key community representatives, 
who are expected to have first-hand knowledge of national service 
programs, to rate the impact and quality of the services provided by 
our programs.
    Every program area sponsored by the Corporation will have some form 
of customer satisfaction survey. We intend to know and report how well 
national service participants are addressing the unmet needs of the 
American people.
    To implement the plan and measure our performance against its 
goals, we have in place, or are in the process of establishing, the 
systems needed to get the job done. We are on schedule to implement 
fully the data collection and analysis plans needed so that we can 
report to the Congress and the public in March 2000 how well we have 
done in meeting our goals.
Reauthorization
    After two years of work with national service sponsors, partners 
and participants, as well as Governors, Mayors, and other local elected 
officials, the Corporation for National Service's reauthorization 
proposal has been transmitted by the President to the Congress, and 
introduced in the House on March 26. The bill, entitled the ``National 
and Community Service Amendments Act of 1998,'' was introduced with 
bipartisan co-sponsorship. The legislation proposes significant steps 
to improve national service, based on the lessons learned over the last 
several years and the careful analysis the programs have received from 
within and outside of the Corporation. Specifically, the proposed 
legislation:
  --Strengthens partnerships with traditional volunteer organizations;
  --Codifies agreements with Congress and others to reduce costs and 
        streamline national service;
  --Provides States additional flexibility to administer national 
        service programs; and
  --Expands opportunities for Americans to serve.
    I want to emphasize that the Administration's proposal is a 
starting point for--not the end of--discussions on what a 
reauthorization bill should include. I look forward to working with the 
Members of the Subcommittee on this important matter.
                               conclusion
    This is an exciting time to be engaged in service. The activities 
of millions of Americans on Dr. Martin Luther King, Jr., Day and in the 
wake of Presidents' Summit for America's Future evidence the growing 
awareness in this country of the importance of community service.
The Martin Luther King Day of Service
    Pursuant to the 1994 Act of Congress, the Corporation works in 
partnership with the Martin Luther King Center for Non-Violent Social 
Change to make the national holiday in honor of Martin Luther King, 
Jr., a ``Day On, Not a Day Off'' in which Americans, across the lines 
that divide us, join in service to their communities. In this, the 
third year of promoting this observance of Dr. King's birthday in a way 
that reflects his life and teachings, we had a breakthrough in focusing 
national attention on this day as a day of service. Our other national 
partners included the United Way of America, the Points of Light 
Foundation and Do Something--a youth service organization. With 
national media attention in almost every major media market and almost 
300 local projects reported in 48 States, the District of Columbia, 
Puerto Rico and the Virgin Islands, we gained significant momentum 
toward our goal and legislative responsibility to promote service in 
honor of Dr. King.
Follow-up to the Presidents' Summit For America's Future
    The Presidents' Summit For America's Future held last April in 
Philadelphia was an opportunity for the public sector to join with the 
private sector and the nonprofit sector to focus attention on the need 
for a new level of concerted citizen action to turn the tide for 
millions of young people. The goal of the Summit and of America's 
Promise, the post-Summit campaign led by General Colin Powell, is to 
mobilize millions of citizens and thousands of organizations--including 
Government, corporations, foundations, faith-based and community 
service organizations--to help children who lack the conditions for 
success in life.
    At the Summit, the Presidents signed a declaration setting five 
goals--five fundamental resources for a young person's success:
  --An ongoing relationship with a caring adult--as a mentor, tutor, or 
        coach;
  --Safe places with structured activities to learn and grow during 
        non-school hours;
  --A healthy start and a healthy future;
  --An effective education providing a marketable skill, including the 
        ability to read well; and
  --An opportunity to serve, not just be served.
    National service is already playing an active role in achieving 
each of these goals. The fifth goal--service by young people--is at the 
heart of our mission. Goal Five seeks a large-scale expansion of youth 
service and service-learning opportunities. The Corporation is helping 
to shape and promote Goal Five in collaboration with a growing alliance 
of organizations committed to that effort, including the nation's great 
civic and youth service organizations such as the Y.M.C.A, Boys and 
Girls Clubs, the Lions Clubs, and Big Brothers Big Sisters of America; 
philanthropic organizations such as the W.K. Kellogg Foundation and the 
James Irvine Foundation; corporations with an interest in youth such as 
Viacom's MTV Networks; and faith-based organizations such as the 
Council of Religious Volunteer Agencies.
    Since last April, scores of States and communities have held their 
own follow-up summits to gather local partners and secure local 
commitments to pursue the summit goals. The national service network is 
actively assisting America's Promise in planning and carrying out these 
follow-up summits along with our original Summit partners--the Points 
of Light Foundation's Volunteer Centers and the United Way of America. 
State Commissions, Corporation State Offices, national service 
sponsors, and national service participants have worked with Governors, 
Mayors, corporate leaders, and nonprofit organizations to develop their 
own plans of action.
    Consistent with the activities of the Summit, on January 1, 1998, 
President Clinton and former President Bush reintroduced the Daily 
Points of Light. Initially awarded during the Bush Administration, the 
Daily Points of Light are designed to honor volunteers and volunteer 
organizations that demonstrate unique and innovative approaches to 
community volunteering and citizen action, with a strong emphasis on 
service focused on the goals for children and young people set by the 
Presidents' Summit for America's Future. The Daily Points of Light 
program is co-sponsored by the Points of Light Foundation, the 
Corporation for National Service, and the Knights of Columbus. The 
Knights of Columbus Supreme Council provides full funding for the 
awards.
    While the examples and initiatives described above represent only a 
fraction of the overall activities and accomplishments of the national 
service programs authorized by the Domestic Volunteer Service Act, they 
provide a glimpse into the remarkable diversity, ingenuity and cost-
effectiveness of national service. These programs share a proud 
history, a long tradition of success, and have evolved to meet our 
nation's challenges. As we move into the next century, AmeriCorps*VISTA 
and the National Senior Service Corps will continue to help local 
communities develop and implement solutions to their problems. The 
programs have thrived through seven administrations, Democratic and 
Republican alike, with strong bipartisan support along the way.
    I look forward to working with the Subcommittee to continue this 
tradition.
                                 ______
                                 
 Prepared Statement of the Association of America's Public Television 
                                Stations
                                overview
    The Association of America's Public Television Stations (APTS) 
submits this testimony to the Senate Appropriations Subcommittee for 
Labor, Health and Human Services, Education and Related Agencies on 
behalf of the nation's 179 local public television licensees. America's 
public television stations reach 99 percent of television households 
through a public broadcasting system that is in place and working now.
    APTS is requesting that the subcommittee provide the Corporation 
for Public Broadcasting (CPB) $340 million in annual appropriations for 
fiscal year 2001. This is the same amount requested by the 
Administration in its fiscal year 1999 budget. In addition, APTS is 
requesting an appropriation of $75 million for CPB in fiscal year 1999 
to establish a matching grant program that will assist public 
broadcasting stations in the conversion to digital broadcasting.
    We are pleased that the Administration has established a Public 
Broadcasting Digital Transition Fund in the fiscal year 1999 budget 
request to Congress. That request is for $450 million over 5 years to 
be administered by CPB and the Public Telecommunications Facilities 
Program (PTFP) at the Department of Commerce.
    Public broadcasters estimate that the costs to convert public radio 
and television to digital technology will be $1.7 billion. Unlike 
commercial broadcasters, public broadcasters are nonprofit or state and 
local government entities that rely on a grassroots funding structure. 
Public broadcasting's support comes from a combination of Federal and 
non-Federal sources, including individual viewers and listeners, 
foundations and businesses, colleges and universities and State and 
local governments.
Unfunded Federal mandate
    Public broadcasting is asking the Federal Government for a total of 
$600 million over 4 years for digital transition. America's public 
television stations concur with the Administration's support of $375 
million for the CPB portion of the fund. Public television stations 
cannot wait, however, until 2003 for the final payout as proposed by 
the Administration. The FCC has mandated that all public television 
stations be on the air with a digital signal by May 2003. Public 
television stations support the division of the CPB portion of the fund 
in an equitable manner among all stations, similar to the community 
services grant (CSG) process currently in place, beginning with $75 
million in fiscal year 1999.
    The remainder of the funds-$225 million over four years, $56.25 
million per year-would be administered by PTFP to meet the needs of 
rural or hardship sole-service stations and to meet the continuing 
analog equipment needs of public television and radio stations.
Stations' fundraising abilities
    Because of their nonprofit status and grassroots funding structure, 
stations are constrained in their ability to finance major capital 
expenditures such as the digital investment. Unlike their commercial 
counterparts, public stations are unable to pass along their costs to 
their customers. Most public broadcast stations cannot take out capital 
loans, and many, by law, must have balanced budgets on an annual basis 
and may not maintain cash reserves. Given these constraints, stations 
cannot use the typical mechanisms available to commercial entities to 
fund a major capital expenditure.
    An additional Federal investment is critical to ensure that all 
citizens of the United States have access to public telecommunications 
services through digital technology. The clarity of high definition and 
the multicasting capability of digital technology will allow public 
television to enhance the educational value of its programming and to 
multiply educational services. With digital, public television can 
serve more diverse, unserved and underserved audiences on a single 
channel.
    Public broadcasting will raise the rest of the necessary funds, 
roughly $1 billion, from other sources: individual contributions, 
corporate underwriting, State funding, foundation grants, and through 
new efficiencies and cost savings. The noncommercial nature of public 
broadcasting makes raising these funds from private sources even more 
challenging than for the commercial networks, and thus requires a 
public investment to meet the new technological standard.
Critical Federal participation
    Since 1968, the Federal Government has provided financial support 
to the public broadcasting system through an annual appropriation. CPB 
will continue to need an annual Federal appropriation in order to 
distribute funds (75 percent) to local public television and radio 
stations for station operations and programming. These community 
service grants (CSGs) provide, on average, one sixth of the revenue for 
a public television station. This figure varies widely, however. Many 
small rural stations depend on Federal support for 30 percent of their 
operating budgets.
    This Federal support will enable public broadcasting to continue to 
serve the nation and maintain its core principles. These principles 
are:
  --Noncommercial character with an educational mission;
  --Creation and delivery of programming of unequaled quality and 
        excellence;
  --Editorial integrity and independence;
  --PTV's adaptation of new technologies to educational and public 
        service purposes;
  --Universal access to our services; and
  --Local ownership, control and focus of public television stations.
With, by and for local constituents
    The goal of each local station is to serve its community. Stations 
are governed by boards composed of people who live and have a personal 
investment in their community; decisions are made at the local level to 
determine the special needs of that community. Public broadcasting is 
the only broadcasting entity that is totally committed to ensuring that 
all Americans have access to free, locally based, enriching programs 
and education services in the digital age.
                          technical leadership
    Public broadcasters have always been leaders in making use of new 
technologies for public service. We developed closed captioning and 
descriptive video services and pioneered satellite delivery of 
broadcast television. Public broadcasters once again have a vision of 
what new digital technology can deliver. We look forward to developing 
further applications of new technology to educate and enlighten all 
Americans.
Community service leadership
    We will provide the following services through these new digital 
technologies:
  --Multicasting will enable public broadcasting to extend the reach of 
        its educational services by enabling stations to broadcast four 
        or more separate, but simultaneous, program streams. Potential 
        channels might include: a preschool Ready to Learn service; K-
        12 instructional programming; GED and college credit 
        telecourses; workforce training; local public affairs; or 
        popular how-to shows.
  --The DTV signal will give public television the ability to transmit 
        computer information and data over-the-air, providing another 
        powerful tool for public television stations to expand their 
        educational missions. Stations will have the capacity to 
        deliver course-related materials to teachers and students, 
        program guide information, and selected portions of the World 
        Wide Web over-the-air to homes and schools. End users will be 
        able to download this information instantaneously, using a 
        television set converter, computer or a digital television 
        receiver.
  --High Definition Television (HDTV) will significantly enhance the 
        beauty and detail of public broadcasting's signature 
        programming in science and nature, performing arts, science, 
        drama and travel.
    Highlighted below are some of our current services that can be 
enhanced in the digital age. Public television will be able to 
multicast more quality programs simultaneously with information and 
data available to download immediately. Science and technical programs, 
through high definition television, will have the same aesthetic 
quality as major motion pictures.
Serving local schools
    Public television stations work directly with local schools. They 
broadcast an average of five and a half hours per day of instructional 
programming for classroom use, enabling 2 million teachers to use 
quality instructional programming to reach 30 million students in 
63,000 K-12 schools. Local stations broadcast overnight so that 
teachers can record and build a library of programs. Stations encourage 
this and many publish special guides for teachers as well as 
supplementary materials to facilitate the use of public television 
programs in the classroom. Public television stations work with 
teachers to enable them to use video most effectively; we also offer 
access to program information on the World Wide Web.
Serving children
    Our educational programming remains the first choice of children, 
parents and teachers. Research does prove that children raised on 
Sesame Street and other public television programs perform better in 
school. The Ready to Learn project undertaken by public television is 
centered around a daytime block of children's programming. Local 
stations have expanded the value of these programs by providing 
outreach services to children and their parents and caregivers to help 
them use public television as an effective learning tool. Over 450 
workshops for parents and caregivers and benefiting over 70,000 
children have been sponsored by local stations.
Serving the local economy
    GED ON TV is an excellent example of what public television does 
best. Produced by the Kentucky Network and currently offered by 54 
percent of public television stations, GED ON TV has enabled nearly 2 
million adults to acquire a high school equivalency certificate. Recent 
figures from the Bureau of Labor Statistics indicate that citizens with 
a high school diploma or equivalency contribute $4980 more per year to 
their state's economy than do high school dropouts. That's almost $10 
billion added to our nation's economy annually. Multiply that by the 30 
or more years American's spend in the workforce.
Bringing the world into schools
    Electronic field trips, produced by Kentucky Education Television 
have allowed an average of 550 classrooms across the state to visit 
Mammoth Cave, a working horse farm, a newspaper and an underground 
Kentucky coal mine. Other electronic field trips, produced by public 
television, have taken students to such exciting locales as the South 
Pole and Colonial Williamsburg.
Serving working adults
    Two thousand colleges and universities are using public 
television's Adult Learning Service (ALS). Local public television 
stations enable 400,000 tuition-paying students a chance to earn a 
college degree through television. In the last 15 years, over 3.5 
million adults have participated in public television's ALS. These 
generally older students often live off campus, are employed and have 
adult responsibilities. Public television helps them move ahead by 
making a college degree accessible.
Funding the mandate
    Congress has mandated the conversion to digital and the Federal 
Communications Commission has set a deadline of 2003 for public 
television stations to broadcast in the digital format. Digital 
technology is not a frill; it's a technological imperative. Since the 
FCC is requiring all television stations to convert to digital 
programming by 2003, public broadcasters are obliged to make 
unprecedented investments in new transmission and production equipment.
    Public broadcasters simply will not be able to make the transition 
to digital without Federal support. Almost half of all public 
television licensees (86 out of 177) will incur transition costs that 
alone exceed their projected annual revenues. Federal funds provide the 
critical seed money that stimulates private contributions.
    For a one-time charge of $2.28 per American-less than the cost of a 
video rental-every viewer will gain a lifetime of unlimited access to 
public broadcasting's enriched and expanded programs and education 
services in the digital era. That's a high value for a relatively low 
cost. The alternative-a future of 500 digital channels with no safe 
harbor of noncommercial educational channels-puts this investment into 
perspective. At a time when the education needs of this nation are so 
great, it should be one of the government's highest priorities.
A model of efficiency
    Public television stations are already exploring the challenges and 
opportunities of digital transition to achieve efficiencies and cost 
savings. Many stations are participating in CPB's Future Fund projects 
to experiment, on a micro basis, with the activities that all of public 
broadcasting may have to undertake in the digital future. The 
transition to digital gives public broadcasters an opportunity to 
undertake collaborative activities that will yield a more efficient 
broadcasting operation while reducing costs.
Congressional leadership
    You have made a very wise investment in public broadcasting. You 
have helped us improve millions of Americans lives every day. We hope 
that you will continue this support by assisting the industry into the 
digital age.
    Thank you. On behalf of the nation's public television stations, we 
look forward to working with you to ensure that we have the financial 
resources to continue to provide the American people free access to 
quality, noncommercial educational television.
                                 ______
                                 
Prepared Statement of the National Federation of Community Broadcasters
    Thank you for the opportunity to submit testimony on behalf of the 
National Federation of Community Broadcasters, or NFCB, which is the 
sole national organization of community oriented non-commercial radio 
stations.
    Community radio fully supports $340 million in funding for the 
Corporation for Public Broadcasting in fiscal year 2001. Federal 
support distributed through the CPB is an unreplaceable resource for 
rural stations and for those stations serving minority communities. In 
the case of the rural and minority stations, CPB support may not ever 
be replaced and the goal of universal, local, non-commercial radio 
service will never be achieved.
    In larger towns and cities, sustaining grants from CPB enable 
community radio stations to provide a reliable source of noncommercial 
programming--about the communities themselves. Local programming is an 
increasingly rare commodity in a nation that can hear and view news 
from around in the world every thirty minutes.
    The NFCB has two requests we submit to the Subcommittee. First, we 
ask that the Subcommittee recommend to the CPB to continue its funding 
priority for rural radio, especially sole service providers, stations 
with minimal donor bases or service areas with limited programming 
alternatives, and community radio stations. Second, we recommend that 
funds for the transition to digital broadcasting allocated to the CPB 
include support for both public radio and public television.
I. Maintain funding to sole service, rural, and stations reaching 
        underserved audiences
    The NFCB requests that the Subcommittee include with its fiscal 
year 2001 CPB appropriation report a recommendation that CPB give 
funding priority to public radio stations that serve rural and unserved 
areas, sole service stations and stations reaching underserved 
audiences. Our request echoes language included in reports from House 
and Senate subcommittees on CPB appropriations in recent years.
    In the Senate Report 105-58 for fiscal year 1998 Labor, Health and 
Human Services, Education and Related Agencies Appropriations, (fiscal 
year 2000 CPB funding) CPB grant programs for the stations described 
above were encouraged with the language: The Committee intends that CPB 
foster services for unserved or underserved audiences focusing on 
entities whose primary services are directed at audiences in rural 
areas and Native American audiences. The Committee is concerned about 
the erosion of grants for radio stations serving these communities.
    The Committee recognizes that stations serving rural and 
underserved audiences have limited local potential for fundraising 
because of sparse populations serviced, limited number of local 
businesses, and low-income level. In rural areas, while many stations 
receive per capita support far greater than that contributed in urban 
areas, they receive relatively few matching dollars because the 
populations served are small.
    The Committee directs CPB to explore new methodologies for 
distribution of Federal matching dollars which take into account 
measures such as per capita support and other factors that would serve 
to level the playing field between urban and rural stations in the 
distribution of matching funds.
    Similar language has been included House reports on the CPB 
appropriations for fiscal year 1998 and fiscal year 1999. We are asking 
that the Subcommittee consider including such a recommendation with the 
fiscal year 2001 appropriation report.
II. Funds appropriated to the CPB for the transition to digital 
        broadcasting should support both public radio and public 
        television
    The NFCB fully supports the maximum funding for CPB to assist 
public radio and television to transition to digital broadcasting. 
While the NFCB understands that television is under a strict deadline 
for the digital conversion, and we support the greatest amount possible 
in Federal funding to assist public television, we want to advise the 
Committee that public radio is already planning for its own digital 
conversion.
    Federal funds distributed by the CPB should be available to the all 
public radio stations eligible for Federal equipment support through 
the Public Telecommunications Facilities Program (PTFP) of the National 
Telecommunications and Information Agency of the Department of 
Commerce. In previous years, Federal support for public radio and 
television equipment has been distributed through the PTFP grant 
program. The PTFP criteria for funding are exacting, but allow for 
wider participation among public broadcasters. Stations eligible for 
PTFP funding and not for CPB funding include small budget, rural and 
minority controlled stations.
    Thank you for your consideration of our testimony.
    The NFCB is a twenty year old grassroots organization which was 
established by, and continues to be supported by our member stations. 
Large and small, rural and urban, the NFCB member stations are 
distinguished by their commitment to local programming and community 
participation and support. NFCB's 90 Participant members and 136 
Associates come from across the United States, from Alaska to Florida; 
from every major market to the smallest Native American reservation. 
While the urban member stations serve communities that include New 
York, Minneapolis, San Francisco and other major markets, the rural 
members are often the sole source of local and national daily news and 
information in their communities. NFCB's membership reflects the true 
diversity of the American population: 40 percent of the members serve 
rural communities and 34 percent are minority radio services.
    On community radio stations' airwaves examples of localism abound: 
on KILI in Porcupine, South Dakota you will hear morning drive programs 
in their Native Lakota language; throughout the California farming 
areas around Fresno, Radio Bilingue programs five stations targeting 
low-income farm workers; in Barrow Alaska, on KBRW you will hear the 
local news and fishing reports in English, and Yupik Eskimo; in 
Dunmore, West Virginia, you will hear coverage of the local school 
board and county commission meetings; KABR in Alamo, New Mexico serves 
its small isolated Native American population with programming almost 
exclusively in Navajo; and on WWOZ you can hear the sounds and culture 
of New Orleans throughout the day.
    In 1949 the first community radio station went on the air. From 
that day forward, community radio stations were reliant on their local 
community for support through listener contributions. Today, many 
stations are partially funded through the Corporation for Public 
Broadcasting grant programs. CPB funds represent about 15 percent of 
the larger stations' budgets, but often can represent up to 40 percent 
of the budget of the smallest rural stations.
                                 ______
                                 
  Prepared Statement of Delano E. Lewis, President and CEO, National 
                              Public Radio
    On behalf of National Public Radio (NPR) and the more than 590 
public radio stations it represents, I respectfully submit this 
statement for the hearing record. For 30 years, the public broadcasting 
system has provided a noncommercial, educational programming 
alternative for parents, children and others. The Senate Labor/HHS 
Appropriations Subcommittee has made a commitment to helping public 
broadcasting fulfill this public service mission. Your efforts are 
greatly appreciated. Looking ahead, public broadcasting plans to better 
serve Americans through new technology. I urge members of the 
Subcommittee to reinvest the resources necessary to revolutionize the 
way public broadcasting delivers its unique programming and services.
    Public broadcasters are seeking two appropriations for the 
Corporation for Public Broadcasting (CPB). The first funding request is 
for a $340 million appropriation for the traditional, annual CPB 
appropriation for fiscal year 2001. As you know, CPB is forward funded 
by two years. Second, we request your support of a $375 million 
appropriation over four years for the conversion to digital 
broadcasting. For fiscal year 1999, public broadcasters urge the 
Subcommittee to appropriate $75 million for digital broadcasting.
Annual CPB appropriation A Public/Private Partnership
    Public broadcasters support the recommended $340 million for CPB in 
fiscal year 2001. Public broadcasters are part of a successful public-
private partnership. According to the latest CPB ``Public Broadcasting 
Revenue Report for fiscal year 1996'', Federal money accounts for 17 
percent of public broadcasting's revenue, a small but important piece 
of the funding pie. The largest single portion of public broadcasting's 
revenue is derived from listeners and viewers, accounting for 23 
percent. Business support accounts for 15 percent, universities and 
colleges 10 percent and foundations eight percent. Support also comes 
from state and local governments (15 percent and three percent, 
respectively). For public radio, every Federal dollar leverages over $5 
from non-Federal sources. That is a five to one return on the Federal 
investment in quality programs and services. Federal money is crucial 
because it helps public radio stations plan, produce and acquire 
programs that attract non-Federal funding sources.
    When Federal public broadcasting funding was challenged in 1995, 
the American public aggressively supported its continuation. In fact, 
when given a choice of 20 services, Americans judged public radio and 
television the second and third best value in return for tax dollars 
spent. Military defense ranked first. This information comes through a 
poll conducted last summer by Roper Starch Worldwide, Inc. The American 
people consider Federal funding for public broadcasting to be a wise 
use of their tax dollars because they value the programming and 
services provided by their local public station. For fiscal years 1998 
and 1999, public broadcasting cost each American 93 cents per year. For 
public radio alone, this figure is merely 23 cents per American each 
year. Currently, CPB funding is at its lowest level since 1992. This 
funding increase will help keep pace with rising programming costs. The 
majority of Federal money is directed to local stations. After CPB 
administrative costs, public radio receives 25 percent of the Federal 
appropriation and public television receives 75 percent. Of radio's 
portion, 93 percent goes directly to public radio stations. The other 
seven percent of radio funds remain at CPB to support national 
programming through a competitive grant process. CPB funding assists 
public broadcasting stations to produce local programming and to 
purchase national programs.
Public Radio Is A Source Of Educational, Cultural and Informational 
        Programming
    Americans rely on public broadcasting for diverse, long-form 
educational, cultural and informational programming. In some cases, 
these programs may not be commercially viable because they do not 
attract a mass audience. Nevertheless, these programs are intrinsically 
valuable because they examine important issues that may not otherwise 
receive necessary attention.
    Public radio stations are treasure-troves of quality local 
programming. This programming, on average, accounts for 48 percent of 
stations' formats. For instance, KUAF-FM in Fayetteville, AR is 
partnering with Washington Regional Medical Center Hospice Program 
(WRMC) to bring listeners information on life and death 
decisionmaking--a special outreach program and broadcast series 
exploring end-of-life issues. KUAF-FM and WRMC will sponsor a series of 
community forums to stimulate dialogue on these topics.
    In addition to shows featuring big band, folk and country music, 
KCMW-FM in Warrensburg, MO offers daily jazz programming which 
regularly features local jazz artists, both past and present, who have 
helped frame and define the jazz genre. In addition, KCMW-FM broadcasts 
the concerts performed at the Scott Joplin Ragtime Festival in Sedalia, 
MO each June. WRTI-FM in Philadelphia, PA produces a classical music 
program titled, Notes from Philadelphia. This program highlights local 
classical musicians and performance groups through their music and 
interviews. These artist are not as well known as some musicians in 
professional orchestras, but they are committed, talented artists who 
perform and give voice to the community. In San Antonio, TX, KSTX-FM's 
Community Forum are monthly public forums which foster lively 
discussion on topics of local interest with experts and the community. 
The April forum will focus on teenage pregnancy, a problem in San 
Antonio. In addition, KSTX-FM has received a grant from Sound Partners 
to produce a 6-month awareness series on teen pregnancy. The station is 
partnering with the Metropolitan Health District as well as co-
sponsoring awareness projects and events with local organizations 
including local schools and a museum.
    Four times a year KPBX-FM in Spokane, WA produces free public 
forums on subjects that are important to the communities of the inland 
northwest region such as education, health care, the environment and 
timber issues. The station brings together groups of up to 250 citizens 
for moderated, face to face discussions with expert panelists. The 
meetings are later broadcast. Hawaii Public Radio produces and 
broadcasts several public affairs programs that are extremely important 
to the ethnically diverse population of Hawaii. A Second Glance is a 
weekly program about native Hawaiian issues. Pacific Island News airs 
three times daily, Monday through Saturday, and collects news from all 
of the Pacific Island communities. Asia Report airs two times daily and 
features news from China, Japan, Korea, and the Philippines. Also, 
KTEP-FM in El Paso, TX produces a senior citizens program, Senior 
Junction, which provides information to the elderly and their care 
givers.
    Public radio is a unique educational resource for local 
communities. KXCV-FM in Maryville, MO is involved in a project with 
teachers from schools in the five-county area to assist them in 
developing lesson plans for developing communication skills. KXCV-FM 
also helps coordinate an industry/education partnership where teachers 
spend a day with various businesses to learn the skills that students 
are expected to need to develop for the world of work. Music educators 
throughout Mississippi integrate Public Radio Mississippi's music and 
arts programs into their teaching plans. Each week over 100,000 
Mississippians tune into PRM. WFDD-FM in Wintson-Salem, NC produces 
Neighborhood News for the Blind. This is a one-hour weekly reading 
service program providing synopses of neighborhood news reported in 
local newspapers.
    Public radio stations also support local artists, musicians and 
cultural opportunities for children. For example, WUSF-FM in Tampa, 
Florida records and broadcasts performances by the Florida Orchestra, 
the Naples Philharmonic and the Sarasota Music Festival. Performances 
by the music faculty at the University of South Florida in Tampa are 
also recorded and aired. WJHU-FM in Baltimore, MD, produces music 
programs that prepare students to better understand and enjoy their 
first symphony concert. The station is under contract with the Chicago 
Symphony Orchestra to replicate this project in Chicago, IL.
    National programs such as All Things Considered , Performance Today 
and Marketplace help draw listeners to public radio. These national 
offerings complement local productions by providing quality 
educational, cultural and informational programs to local communities. 
For instance, in May, NPR's Talk of the Nation will broadcast a four 
part series chronicling the history of America's disabled community. 
Beyond Affliction will examine this powerful issue that other media 
often ignores. Locally, stations may develop their own programming and 
outreach activities to complement national special programs. Over 50 
disability organizations and their local chapters have agreed to 
provide NPR stations with experts for local programming and assistance 
in organizing or sponsoring community events.
    National cultural programs such as Performance Today provide 
listeners with thoughtful, helpful insights into the world of classical 
music together with great concert performances. Wynton Marsalis: Making 
the Music is a series designed to explore an American art-form, jazz. 
The program is hosted by Wynton Marsalis who engages and educates 
listeners about the history and sound of this music.
    Public radio's news programs present in-depth reports which furnish 
the full particulars of a story. For instance, Marketplace is a 
national series detailing the world's news through a business, economic 
and financial perspective. NPR's Morning Edition and All Things 
Considered are two award-winning news magazines that cover in-depth 
politics, international affairs, education, arts, sports and music. 
Stations rely on Federal funding to purchase these national treasures, 
providing public radio stations with a balance of local, national and 
international programming.
Americans Value Public Broadcasting
    In addition to the polling results discussed earlier, there are 
other obvious ways listeners show their support. They donate their time 
and money. In 1995, people volunteered over 2.5 million hours at their 
local public radio and television stations. Nearly 7 million people 
supported public radio and television financially. \1\ Millions of 
other people who listen and view public broadcasting value the programs 
and services. For instance, WJAZ-FM and WITF-FM in the Harrisburg, PA 
area have 22,000 weekly listeners. Meanwhile, WOI-AM/FM in the Des 
Moines, IA area have 65,700 listeners weekly, and in Mississippi WMAB-
FM and WMAE-FM in the Columbus-Tupelo area have 15,700 listeners. \2\
---------------------------------------------------------------------------
    \1\ CPB. ``Frequently asked questions about Public Broadcasting 
1997'', page 9.
    \2\ National Public Radio. Strategic Planning and Audience Research 
[SPAR].
---------------------------------------------------------------------------
    There are also many Americans abroad that listen to public radio 
through the Internet or Armed Forces Radio. U.S. Army Sergeant Tom 
Daniels had this to say about public radio while stationed in Bosnia-
Hercegovina, ``I found Armed Forces Radio playing All Things Considered 
at 11 p.m., each night, and I was thrilled. I just wanted to say thank 
you! I listen every night, and as you are my greatest contact with 
America, I can keep that feeling of home.'' Dennis Keeton wrote, ``I am 
a soldier on active duty and have listened to NPR through Armed Forces 
Network while serving in Germany and while living in a tent in Zagreb, 
Croatia with UNPROFOR. Weekend Edition, All Things Considered, Car Talk 
and many others have all been treasured links with America and HOME. 
Thank you for all of the listening enjoyment.'' A $340 million CPB 
appropriation for fiscal year 2001 will assist public radio with 
continuing to deliver this quality, educational programming that 
Americans everywhere rely on and expect.
Digital CPB appropriation: An investment in the future
    Reinvesting in the future of public broadcasting is an investment 
in education, culture and an informed public. Public broadcasting is 
requesting a $75 million CPB digital appropriation for fiscal year 
1999, $100 million in fiscal year 2000, $100 million in fiscal year 
2001, and $100 million in fiscal year 2002, for a grand total of $375 
million. Public broadcasters are also requesting $225 million over four 
years for the Public Telecommunications Facilities Program (PTFP), a 
matching grants program, to fund both the system's current equipment 
replacement needs and digital broadcasting. Together, the Federal 
digital funding appropriation is $600 million over four years. Public 
broadcasters estimate that the digital conversion will cost $1.7 
billion.
    There are two known scenarios where public radio stations will be 
impacted by the transition to digital television (DTV)--tower 
relocation and signal interference. Access to Federal money will be 
vital to public radio stations incurring these additional costs. 
Congress' mandate to convert television stations to DTV will result in 
many radio stations currently co-located on a television tower having 
to move from these leased towers. DTV technology requires that more 
transmission equipment be placed on towers, creating a weight and a 
load problem. Thus, these public radio stations would have to build new 
towers, an expensive prospect. Or, if space is available, a dislocated 
public radio station would have to move to another tower and may incur 
interference problems. There is also a possibility that after the DTV 
transition, public radio stations would have to move a second time. 
Forty-eight public radio stations have been identified as candidates 
for antenna or tower relocation as a result of planned installations of 
DTV facilities. NPR is working to identify other stations with 
translators that may also be affected by DTV.
    There are also other significant costs associated with the 
transition to DTV. For instance, there is a possibility of greater 
interference involving adjacent television and reserved FM band 
stations. Federal assistance can help ease the severity of these 
expensive disruptions. Public radio must be included in digital funding 
legislation. Public radio estimates that its portion of the overall 
digital transmission conversion cost is $50 million. While public 
television is operating under a mandate to convert to digital 
broadcasting by 2003, public radio has no similar directive. Currently, 
the U.S. is without a technical standard for digital radio, but one is 
expected. Conversion to digital transmission, however, is only a part 
of the imminent digital revolution. As the communications marketplace 
experiences even greater growth, public radio must be poised to take 
advantage of new and emerging digital production, transmission and 
distribution technologies that can offer programming to listeners in 
ways not imagined.
    The transmission technology currently emerging is called Digital 
Audio Broadcasting (DAB) which delivers compact disc-quality sound free 
of interference and noise to listeners. DAB will allow radio stations 
to upgrade their delivery of audio programming. For example, digital 
radio will provide more reliable AM and FM transmissions, less subject 
to the effects of geography and terrain. This is particularly important 
in rural areas, where there would be little or no broadcast service 
without public broadcasting. Digital will also permit public stations 
to transmit ``smart radio'' signals that deliver text messages along 
with the audio program. This digital text may be used to locally 
provide continuous specialized information, such as weather, traffic, 
music titles, program or emergency information on a local basis.
    Digital radio also offers spectrum efficiency. It is touted as 
being of equal or greater efficiency as its analog FM counterpart. 
Tests have shown when operating at the same transmitting frequency as 
the current FM band it can also be more power efficient than FM, 
requiring around one one-thousandths the amount of transmitted power to 
cover the same area.
    The investment in digital broadcasting will allow public 
broadcasting stations to participate in the sweeping technological 
revolution, resulting in a more dynamic and valuable public 
broadcasting system. Please support a $375 million digital CPB funding 
level over four years.
Conclusion
    Public broadcasting is poised to deliver bold new services through 
new technologies. Public broadcasting's goals cannot be realized 
without significant funding increases. Again, public broadcasters urge 
the Subcommittee to support a $340 million annual CPB appropriation and 
a $375 million appropriation for digital over four years. With your 
help, public radio and television can better fulfill its mission to 
advance education, to support culture and to foster an active 
citizenship through an informed public.
                                 ______
                                 
    Prepared Statement of the National Minority Public Broadcasting 
                               Consortia
    The National Minority Public Broadcasting Consortia (Minority 
Consortia) submits this statement on the fiscal year 2001 appropriation 
for the Corporation for Public Broadcasting (CPB). Our primary missions 
are to bring a significant amount of programming by and about our 
communities into the mainstream of public broadcasting. And our primary 
message today is that we want to get back on course with CPB in our 
working partnership to increase the diversity of programming available 
through public broadcasting. Below are our recommendations:
  --Principles of Partnership. We requst a minimum of $5 million for 
        the Principles of Partnership initiative as agreed to by CPB in 
        1994 in addition to the current funding provided to the 
        Minority Consortia. We request that any funding increase up to 
        $5 million over the fiscal year 2000 level be provided for this 
        far-sighted initiative. The House Appropriations Committee 
        Report from last year (H. Rpt. 105-205) stated:
    --The committee supports the CPB's commitment to maximize resources 
            with the goal of increasing multicultural programming for 
            public television by formalizing partnerships among the 
            Minority Consortia organizations, the CPB, the Public 
            Broadcasting System, America's Public Television Stations, 
            and individual television stations.
    --We ask that this Subcommittee and Congress follow through on the 
            its stated support for CPB implementing the Principles of 
            Partnership agreement.
  --Funding. We support $340 million in fiscal year 2001 CPB funding 
        for programming and system support as requested by the 
        Administration.
  --Digital Conversion. Two requests with regard to the provisoin of 
        digital conversion funding for the public broadcast system: (1) 
        We ask that some digital conversion funds be used to assist 
        producers with the increased costs of producing programming for 
        digital broadcast, and (2) We also ask for Congressional 
        support for prime-time digital broadcasts of a broad range of 
        programming.
  --CPB Plans for Multicultural Programming. We request Congressional 
        support for the creation of a CPB draft plan regarding its 
        vision for continued mission and support of the Minority 
        Consortia and increased multicultural programming.
    We are operating under two handicaps in submitting this statement. 
First, we submit this statement knowing only the funding level 
recommended by the Administration for fiscal year 2001 for CPB; the 
detailed CPB budget justification is not yet available. After we have 
seen the budget justification, we may want to file supplemental 
comments to the Subcommittee. Second, CPB is in a state of flux and 
reorganization. Its policies with regard to the Minority Consortia are 
undergoing review--evidence of this is that it was nearly seven months 
into fiscal year 1998 before any of the Minority Consortia 
organizations received our fiscal year 1998 administrative contracts 
from CPB. While we appreciate that CPB is undertaking a system-wide 
review of its contracts and other financial management issues, and will 
continue to cooperate with those efforts, it has been a hardship on our 
organizations.
    A commitment of $340 million by the Federal Government to public 
television and public radio is a wholly reasonable contribution toward 
this national treasure. If there is one thing that the past few years 
debate on public broadcasting has shown is how highly people in this 
nation value it.
    Public broadcasting is particularly important for minority and 
ethnic communities. While there is a niche in the commercial broadcast 
and cable world for quality programming about our communities and our 
concerns, it is in the public broadcasting industry where minority 
communities and producers are more able to bring you quality 
programming for national audiences. In 1994, CPB initiated research 
among Asian American and Native American communities documenting that 
respondents felt their communities were negatively stereotyped on 
commercial television but that public television had more realistic 
portrayals. \1\ This survey also revealed that both groups wanted 
increased visibility in public television and further recommended that 
there be expanded promotion of public broadcast programming utilizing 
Asian-American community groups and tribal organizations. Earlier CPB 
surveys of the Latino and African American communities showed similar 
findings.
---------------------------------------------------------------------------
    \1\ Reaching Common Ground: Public Broadcasting's Services to 
Minorities and Other Groups, July 1, 1994, pages 41-42 of the Appendix.
---------------------------------------------------------------------------
    It is clear that we and our communities and CPB need each other to 
address the Congressional mandate regarding minority communities and 
multicultural programming in the CPB authorizing statute. CPB, the 
Public Broadcasting System (PBS) and America's Public Television 
Stations (APTS) and the stations want and need the culturally diverse 
programming for public broadcasting that the five Minority Consortia 
organizations can help develop, produce and distribute. We, on the 
other hand, need continued financial and in-kind resources from CPB and 
public broadcasting to increase our programming production capacity and 
to facilitate business planing toward financial self-sufficiency. We 
have had some promising negotiations with CPB, PBS and APTS over the 
past several years on both of these counts, but neither effort has yet 
carried through to fruition.
    Principles of Partnership Initiative. Below is a brief description 
of partnership effort between the Minority Consortia, CPB, APTS and PBS 
which we urge Congress to support:
    In 1994, after protracted discussions, CPB publicly announced 
funding to formalize partnerships between the Minority Consortia 
organizations with CPB, PBS, APTS and television stations to maximize 
all our resources in an effort to increase multicultural educational 
programming for television. The funding for this Principles of 
Partnership initiative, $5 million, was to begin October 1, 1995. 
Concurrent with this funding, the Minority Consortia agreed on a joint 
plan of distribution methodology, allocating funds for production, 
community capacity-building, and program support functions. This 
agreement between the Minority Consortia and CPB was announced with 
considerable fanfare in a CPB newsrelease and reported in the public 
broadcast press in June 1994. There is also a lengthy section on the 
Principles of Partnership agreement in the CPB report presented to the 
103rd Congress, Reaching Common Ground: Public Broadcasting's Services 
to Minorities and Other Groups, July 1, 1994.
    The Principles of Partnership included:
  --Establishment of an annual $5 million Minority Program Fund for 
        development, production and capacity-building, including 
        promotion and outreach;
  --Each Consortia organization would enter into a partnership with a 
        public television station;
  --Producers of all races and backgrounds and from consortia, 
        stations, and regional networks would be eligible to submit 
        proposals and receive grants;
  --Grants would be available to national and regional programs as well 
        as audience-building and outreach services and ``capacity 
        building'' activities;
  --CPB would create system advisory panels including top CPB , PBS and 
        APTS programmers, station executive and independent producers;
  --Programming supported by the Minority Program Fund would be 
        available to all PTV stations;
  --After five years, the arrangement would be evaluated and changed if 
        advisable.
    Unfortunately CPB, citing budget cuts, decided not to provide the 
$5 million funding for the partnership initiative. However, CPB did 
create an $11 million ``Futures Fund'' which contained no specific 
initiatives for the work of the Minority Consortia. Because the 
Principles of Partnership funding was to be in lieu of funding 
increases (as supported by Congress) for infrastructure and program 
development, we feel strongly that CPB, despite budget pressures, 
should have committed funding for the Principles of Partnership--the 
timing was optimum. By the end of 1994, we had been working with CPB, 
APTS, and PBS, and others in the public broadcast field for over a year 
to reach this agreement. Understanding and good will was at an all time 
high among the ``principals'' of this partnership.
    Digital Conversion. CPB is requesting funding for an initial 
installment of funds for the required conversion to digital broadcast. 
As you know, there are costs involved in the conversion which go beyond 
the significant equipment and hardware needs of television and radio 
stations. It will also take additional money to produce programming for 
digital broadcast. All producers will face these new, higher costs. 
Film producers will need to use equipment that is high definition 
quality, and that is an expensive proposition. For instance, producers 
will need to use 35 mm or super 16 film. Producers will need new, and 
expensive, field equipment and cameras in order to shoot in wide screen 
format. Most of the producers with whom we work do not have the 
finances for this new equipment.
    Our understanding is that public television will air prime time 
programming on digital broadcast. In non-prime time, the signal will be 
split so that four programs can be accessed at any one time. These non-
prime time programs will be in the analog format. The National Minority 
Public Broadcasting Consortia organizations, a major producer of 
multicultural programming for public television, believes that the 
programs which are broadcast in digital format should include the whole 
range of what is available on public television. Digital broadcast 
should not be limited to big musical events or those programs which 
feature beautiful landscapes. For the full range of programming to be 
digitally broadcast, independent producers , including those who 
multicultural programming, will need to be able to meet the higher 
production costs.
    We ask that Congress, in appropriating funds for digital conversion 
for the public broadcast system: (1) provide assistance to producers 
for the conversion, and (2) support prime-time digital broadcasts of a 
broad range of programming, including multicultural programming.
    Congressional Support. Since 1988, nine House and Senate 
authorizing and appropriations reports have expressed support for CPB 
funding of the Minority Consortia \2\ and multicultural programming.
---------------------------------------------------------------------------
    \2\ House Report 100-825, report of the House Committee on Energy 
and Commerce on the Public Telecommunications Act of 1988.
    Senate Report 100-444, report of the Senate Commerce, Science and 
Transportation Committee, on the Public Telecommunications Act of 1988
    House Report 102-363, report of the House Committee on Energy and 
Commerce on the Public Telecommunications Act of 1991
    Senate Report 102-221, report of the Senate Commerce, Science and 
Transportation Committee report on the Public Telecommunications Act of 
1991
    House Report 102-708, report of the House Appropriations Committee 
on the fiscal year 1993 Labor, HHS, Education Appropriations Act 
(fiscal year 1995 CPB funding)
    House Report 103-156 report of the House Appropriations Committee 
on the fiscal year 1994 Labor, HHS, Education Appropriations Act 
(fiscal year 1996 CPB funding)
    House Report 103-553, report of the House Appropriations Committee 
on the fiscal year 1995 Labor, HHS, Education Appropriations Act 
(fiscal year 1997 CPB funding)
    House Report 104-659, report of the House Appropriations Committee 
on the fiscal year 1997 Labor, HHS, Education Appropriations Act 
(fiscal year 1999 CPB funding)
    House Report 105-205, report of the House Appropriations Committee 
on the fiscal year 1998 Labor, HHS, Education Appropriations Act 
(fiscal year 2000 CPB funding)
---------------------------------------------------------------------------
    Despite good Congressional interest, funding for the work of the 
Minority Consortia has remained extremely modest and has certainly not 
matched the overall increases for CPB since the 80's. In fiscal year 
1997 we received 1.7 percent of the CPB budget in combined 
organizational support program funds ($1.45 million in organization 
support and $3.3 million in Multicultural Program funds for the five 
organizations combined). Despite ups and downs in annual 
appropriations, funding for CPB grew 72 percent from fiscal year 1985 
through 1997. During this same time CPB funding for the minority 
consortia organizational support went from $663,500 (0.44 percent of 
the CPB budget) to $1.4 million (0.55 percent of the CPB budget).
    The Minority Consortia, along with many others who receive funding 
through CPB, expect to receive reductions in fiscal year 1998 and 
fiscal year 1999 because of the cut in Federal appropriations.
    Common Concerns. When we say that we want increased programming by 
and about our communities, we do not mean that our programming is 
limited in its value to members of our communities. Nothing could be 
further from the truth. The notion that minority producers cannot 
produce programming of interest to the general viewing audience has 
permeated the system for too long. Our concerns are common to all of 
America--crime, drugs, literacy, education, teenage pregnancy. Examples 
of minority programming well received by the general viewing audiences 
include Stand and Deliver, Maya Lin, Daughters of the Dust, 
Storytellers of the Pacific, and in the White Man's Image. The list is 
very long.
    It is true that we are extremely interested in bringing to the 
general public our histories--histories which include family 
traditions, educating our youth, the civil rights movement--which have 
for have for too long been unreported and misreported. It is in the 
national interest that the many peoples who form the mosaic of the 
United States better understand and appreciate each others history, 
culture, and contributions to today's society.
    Thank you for consideration of our requests. Congress has the power 
to help public broadcasting renew its commitment to the work of the 
Minority Consortia in expanding the diversity of public programming and 
attractingnew audiences to the public broadcasting system.
    Summary of the Work of the Minority Consortia Organizations. The 
programming one sees and hears on public television and radio are the 
end products of a long, long road. The work of the Minority Consortia 
organizations is largely on the front end of the production process, 
and thus our programming image is not always visible in national 
distribution. The Minority Consortia organizations have close ties with 
our communities and are a bridge between public broadcasters and the 
general public. We have in the last five years provided to Public 
Broadcasting's program schedule hundreds of hours of programming 
addressing the cultural, social and economic issues of the country's 
racial and ethnic communities. Additionally, each organization has been 
engaged in cultivating ongoing relationships with the independent 
minority producers community by providing program funding, programming 
support and distribution assistance. We also provide numerous hours of 
programming to individual public television and radio stations.
    Individually, each organization plays an increasingly effective 
role in interfacing with a broad spectrum of their constituent groups. 
Training projects, community outreach--including youth employment 
opportunities, school support programs, and community festivals are 
ongoing activities of each organization. Some of these projects have 
generated new, non-Federal revenue streams. We have also developed 
unique operational competencies. For example:
  --The National Asian American Telecommunications Association has an 
        8-year investment in the sales of its video library, serving 
        over one-thousand institutions annually, and has turned this 
        endeavor into a potentially-rich source of new income.
  --Native American Public Telecommunications has gained substantial 
        experience technology initiatives through its relationships 
        with the American Indian Radio on Satellite (AIROS) project, 
        the Tribal Infrastructure Information Highway Project (TIIP) 
        and generating co-productions between national producers and 
        public broadcast stations.
  --The National Black Programming Consortium's highly-successful 
        ``Prized Pieces'' international film and video competition 
        brings together a broad cross-section of the independent 
        production community, the international film community, and 
        public broadcasting. The Heritage Video and Learning Center 
        provides an invaluable resource to the community with an 
        extensive array of quality programming. The video and learning 
        center enables our audience to access hundreds of programs 
        which highlight the works of independent and commercial 
        filmmakers.
  --The National Latino Communications Center has leveraged its long 
        history of positive relationships within the Latino community 
        at large, and with the Latino producing community to build a 
        new pledge model aimed at focusing the reach of public 
        television's fundraising activity into the Hispanic community. 
        NLCC has leveraged its programming dollars very successfully, 
        with a rate of five dollars to one.
  --Pacific Islanders in Communications, the newest Consortia member, 
        is already developing a production expertise having served as 
        executive producer for two national series. One of those 
        series, done in conjunction with Native American Public 
        Telecommunications, Storytellers of the Pacific, received the 
        awards for Best Documentary, Best Global Indigenous Production, 
        and Outstanding Series Award of the Dreamspeakers Film 
        Festival.
                                 ______
                                 
 Prepared Statement of Ron Niesing, President, the National Council of 
             Social Security Management Associations, Inc.
    The National Council of Social Security Management Associations 
(NCSSMA), of which I am President, has for twenty-nine years been the 
voice of Social Security's field office and teleservice center 
management. Each day we directly serve the American public in person 
and over the phone. For many of those we serve, we provide the only 
face-to-face contact they have with the Federal Government. When the 
Vice President met recently with the heads of what he has named ``High 
Impact Agencies,'' including SSA, he said: ``Yours are the agencies 
that shape the public's opinion of government and can redeem the 
promise of self-government. Public cynicism about government is a 
cancer on democracy. Reinvention isn't just about fixing processes, 
it's about redefining priorities and focusing on the things that 
matter.'' The Government Performance and Results Act similarly asks 
agencies to focus on performance measures which reflect outcomes valued 
by the public.
    We who live and work in the same communities as those we serve 
across the country are the ones accountable in the eyes of the public 
for proper administration of all of SSA's programs. Our greatest 
concern is to serve the American public well by providing not only 
timely, accurate payment of their Social Security benefits but also 
dignified, courteous service. The public deserves--and has paid for--no 
less.
    NCSSMA urges Congress to provide SSA with sufficient fiscal year 
1999 funding to permit infusion of resources into community-based field 
offices and teleservice centers, including earmarked funds for an 
effective and ongoing public education effort. Following are the views 
of our members across the country on some of SSA's most serious 
resource problems and needs.
Public education
    As this Committee begins work to determine fiscal year 1999 funding 
levels for the administration of Social Security programs, the country 
has embarked on a crucial debate about the long-term future of Social 
Security. While Congress and the President grapple with the challenges 
of Social Security reform, the question of how to quickly and 
effectively involve the public in that debate is paramount. Without 
public education and consensus-building, without public confidence and 
trust in the future of Social Security, successful reform cannot 
happen.
    Like politics, all education is ``local.'' The 3,200 members of the 
National Council of Social Security Management Associations, 
representing Social Security managers and supervisors working in SSA's 
1,300 field offices across the country have learned this through 
firsthand experience. Our experience also teaches that community-based 
service is the most effective and most trusted way to serve the public.
    Public education about Social Security--through speeches, seminars, 
workshops, local radio and television, press releases, and school 
presentations--was historically one of the cornerstone's of SSA's field 
services. Yet, as the Social Security Advisory Board points out in its 
recent report, ``Increasing Public Understanding of Social Security,'' 
reduced SSA staffing since the 1980s, combined with increasing 
workloads, results in conflicting demands which significantly diminish 
critical public information activities at the local level. Reductions 
in supervisory ranks in recent years, aimed at an arbitrary 
``supervisory ratio'' target, have even further reduced local managers' 
ability to be active in community activities outside the office.
    Community involvement and education in the past not only helped 
those who live and work in our communities but also helped the agency 
retain the trust and support of those communities. The erosion of time 
for community activities among Social Security field managers, driven 
by budget exigencies, is in part responsible for the nationwide loss of 
public faith in the future of Social Security programs and in the 
Federal Government itself.
    At the local level, we can facilitate public engagement in the 
question of how to proceed with modifications to the Social Security 
system. Our ongoing presence and involvement in communities across the 
country then must continue if Social Security is to regain and maintain 
public trust. As the Social Security Advisory Board states: ``The 
agency's many knowledgeable employees in communities throughout the 
Nation constitute a valuable resource for increasing the public's 
understanding of Social Security. The agency should make greater use of 
this resource.'' Recent SSA initiatives to train staff and managers on 
the history, philosophy, and mission of Social Security will begin to 
address this need.
Fraud and misuse of social security numbers
    Social Security field office managers and supervisors take our 
responsibilities as stewards of the public monies very seriously. As 
SSA and its independent IG have both testified, we are well positioned 
and well qualified to identify fraud and abuse, another critical factor 
in garnering public trust and confidence. Any significant success SSA 
might have in combating fraud and abuse of Social Security numbers will 
depend on the efforts of local managers working directly with employers 
and employee groups within their respective communities.
    For example, a number of years ago, Social Security received wage 
reports for employees who were using incorrect Social Security numbers. 
Discrepancies were resolved with face-to-face contacts by local offices 
with employers and employees. Since SSA began downsizing its staff and 
management resources, these types of routine contacts were eliminated. 
It would be interesting to note any statistical differences in 
fraudulent use of Social Security numbers now compared to those times 
when the agency processed these wage reports. Proper posting of Social 
Security earnings records and frequent issuance of duplicate SSNs are 
other workloads with fraud and abuse implications confronted in the 
field.
    As long as field offices are handicapped by inadequate staff, our 
ability to focus on identification and prosecution of all types of 
fraud is compromised. Problems such as the one uncovered in Georgia, 
where 181 members of an extended family were receiving SSI benefits, 
could be avoided if sufficient management and staff were in place in 
field offices to work with local medical providers.
Overall staffing levels
    In 1993, the National Performance Review (NPR) called upon agencies 
government to reduce the number of supervisors, headquarters staff, and 
management control positions by half. Despite the intent of these 
mandates to reshape the face of government and to put the resources on 
the front-lines, only slightly more than 50 percent of SSA's employees 
work in field office and teleservice centers to provide direct services 
to the American people. Headquarters staffing and management control 
functions have not been reduced by 50 percent, as directed by the NPR.
    Field offices are given staffing justified through the measurement 
of some of the work we produce. However, there is no justification or 
method in place to measure the work--or the value of that work to the 
mission of SSA--produced by staffing resources in headquarters and 
other components which are supposed to support the work that is done in 
the field.
    Long-range plans call for the SSA to reduce overall staffing levels 
from approximately 65,000 currently in place to 62,000 by the end of 
fiscal year 1999. It is our understanding that more than half of these 
cuts will be absorbed by the field and TSC components--the very 
facilities that are visited or called by your constituents every day. 
These cuts will be made despite the unmet directives of the NPR to 
reduce headquarters staffing; despite the increasing workloads 
processed in field offices to combat fraud and abuse, such as more 
Continuing Disability Reviews and SSI reviews; despite the 
modernization of SSA systems that will allow more work to be processed 
directly in field offices and less in program service centers; and 
despite the fact that the public has shown on numerous occasions that 
it prefers dealing with SSA on a face-to-face basis, especially in 
their initial contact with the agency when filing for benefits
Span of supervision
    SSA has relentlessly pursued the NPR mandate to reduce the number 
of supervisors to employees to a 1:15 ratio, despite the fact that SSA, 
as an independent agency, cannot be required to do so under the 
Executive Order directive.
    Reductions in SSA's supervisory ranks are being done without any 
analysis of the impact on our ability to serve the American public. 
Every time a supervisor is cut in the field, the level and quality of 
service suffers. SSA has not recognized the unique role that managers 
and supervisors play in carrying out the mission of this agency. In 
addition to negative impacts on the working environment for employees 
and the increased demands on remaining supervisors and office managers, 
SSA suffers potentially increased costs because there are fewer quality 
reviews and declining technical support for its employees in the field 
offices and teleservice centers. There are fewer resources available to 
conduct community outreach and education on program solvency. There are 
fewer resources available to ensure that employers and employees are 
doing their part to reduce fraud and abuse in the use of Social 
Security numbers or in the initial receipt of or continuing payment of 
Social Security or SSI benefits.
    A dramatically increasing number of field offices have only one 
management person, placing an almost impossible burden on them. How 
does one individual manage a facility, supervise employees working in 
different jobs, educate the public, and combat potential fraud and 
abuse? The overall cuts in front line employees preclude the assignment 
of some of these responsibilities to non-supervisory staff.
Local telephone service
    Probably the single biggest complaint your home offices receive 
about Social Security is the inability of your constituents to get 
their telephone calls through to their local Social Security office. 
Significant improvements have been noted in SSA's toll-free 800 number 
service, but many people still prefer to deal with the people that they 
know--their local Social Security office.
    A recent NCSSMA survey revealed that nearly all field office 
managers feel their offices provide inadequate phone service to your 
constituents. SSA has not measured the impact or volume of local 
telephone calls, but many individual field office studies of local 
telephone service have revealed busy rates of upwards of 75 percent. 
This means that three out of four callers to some Social Security 
offices are not getting through.
    To some extent, new technology, such as voice mail and automated 
attendant, has enabled local offices to offer better services to the 
calling public. However, this new technology has not allowed for 
significantly more of the public to get through on our telephone lines. 
We still have the same number of incoming lines and the same, if not a 
declining number, of individuals available to answer those calls. It is 
time for SSA's commitment to improved telephone service to be expanded 
to include the services to the millions of Americans who are calling 
their local Social Security offices each day.
Disability workloads/disability reengineering
    SSA is moving forward with various disability initiatives. Pilot 
projects around the country are aimed at finding better ways to process 
initial disability claims. In fiscal year 1999, local offices will 
process over 2.1 million initial disability claims and will help 
process a record number of CDR's--over 1,600,000. The real problem, 
however, is not in the initial claims process, but rather in the 
appeals process. Adequate resources need to be directed toward the 
appeals process to ensure that staff have modernized, up-to-date 
equipment to handle their work. We hope this Committee will work with 
SSA to secure more accountability from the Office of Hearings and 
Appeals in reducing overall appeals times.
Overdependence on the promise of automation
    Social Security offices have and are undergoing significant 
changes, especially as related to the continued automation of our 
programs and the installation of new computer systems or IWS/LAN. All 
of us appreciate the support and efforts of this committee, in 
particular, in getting these tools to us on the front lines. However, 
automation alone has not been the panacea for all SSA's workload 
problems.
    The agency's Strategic Plan repeatedly points to productivity gains 
from automation initiatives as solutions to workload management 
problems. This is doubly dangerous. Experience of the past teaches that 
productivity increases from automation have been attained much further 
in the future than projected. In addition, a focus on services such as 
the PEBES website and public information made available through the 
Internet ignores the demographic realities of a large portion of the 
population we serve. For example, while less than 35 percent of 
American homes currently have computers, 25 to 35 percent of the U.S. 
population is functionally illiterate. Although growing numbers of 
Americans have home computers and Internet access, the numbers of 
individuals without these tools is also growing. Many people for many 
reasons will continue to walk in the doors of Social Security offices 
and telephone our teleservice center representatives across the 
country. The ability of these facilities to handle these workloads, and 
the level of resources given to them to do the job right, will be 
crucial to the success of SSA and will influence heavily the impression 
many Americans have of their government.
Training and development
    SSA is set to embark on one of its most ambitious training 
initiatives for managers and supervisors. It would be in the best long-
term interest of the agency if this training were focused on management 
skills for the changing environment in today's workplace, management of 
budget and procurement processes, and public education initiatives 
related to solvency and reform of Social Security. A well-trained 
management corps ensures that we will most effectively meet the needs 
of the public we serve. SSA will be able to more effectively educate 
the public now that it is once again training employees on the history 
and mission of Social Security, but SSA must also focus its attention 
on the development of future leaders that will be necessary due to the 
retirement of many of its senior managers in the next 5 to 10 years. 
SSA recently announced a management development program, restricted to 
only 10 people, which will not begin to meet the long-term needs of 
SSA.
Conclusion
    NCSSMA strongly advocates full funding of SSA's fiscal year 1999 
budget request and enhancement of all locally-delivered services 
nationwide to meet the variety of needs of beneficiaries, claimants and 
the general public. To maximize efficient use of taxpayer dollars, 
locally-delivered services can be effectively coordinated with services 
provided by SSA's more centralized teleservice centers. Only through a 
balanced approach to provision of all services, including re-
invigoration of efforts to effectively educate the public about Social 
Security through community activities at the local level, can SSA 
fulfill its mandate and help restore trust in government. We recommend 
that funding be earmarked to ensure sufficient staffing resources and 
monies for public information materials in the field to facilitate a 
successful public discourse on Social Security reform.
    Focusing on provision of better public service, NCSSMA is 
developing recommendations regarding SSA's claims-taking initiatives, 
telephone service, disability process, labor-management partnership and 
performance measures. We are updating our recommendations for 
development of a comprehensive plan for efficient service-delivery 
across the entire range of services and facilities within SSA. As we 
develop these projects, we will share our ideas with the members of 
this committee in the hope of garnering your support and guidance.
    It is also our hope that any future performance commitments made by 
SSA to this Committee will better reflect the diversity and inter-
dependence of the services we provide within the context of a balanced 
plan, rather than focus on a narrow set of measures which result in 
erosion of our ability to fulfill all of our responsibilities to the 
public. A stable Social Security Administration which delivers quality, 
community-based service throughout the country is our primary goal, and 
we urge SSA administrative funding for fiscal year 1999 which is 
supportive of that goal. Thank you for considering our views.
                                 ______
                                 
Prepared Statement of Jane Watkins, President, National Association of 
  Foster Grandparent Program Directors; Dwight Rasmussen, President, 
  National Association of Senior Companion Project Directors; and Nan 
 York, President, National Association of Retired and Senior Volunteer 
                           Program Directors
    We are pleased to testify in support of fiscal year 1999 
appropriations for the Foster Grandparent Program (FGP), Senior 
Companion Program (SCP), and Retired and Senior Volunteer Program 
(RSVP), known collectively as the National Senior Service Corps (NSSC) 
authorized by the Domestic Volunteer Service Act and administered by 
the Corporation for National and Community Service.
    The National Directors Associations are membership-supported 
professional organizations whose rosters include the majority of more 
than 1,200 directors who administer NSSC programs across the nation, as 
well as local sponsoring agencies and others who value and support the 
work of NSSC programs.
    While we support the aggregate funding levels set forth in the 
President's fiscal year 1999 budget request for the Senior Corps, we 
request that the subcommittee approve a fiscal year 1999 allocation for 
our programs in a slightly different manner from that proposed by the 
President. Specifically, we request that the Subcommittee appropriation 
a funding level of $173.910 million for the National Senior Service 
Corps in the aggregate: $43.001 million for the Retired and Senior 
Volunteer Program (RSVP), $37.653 million for the Senior Companion 
Program (SCP), and $93.256 for the Foster Grandparent Program (FGP).
    Where the President proposes to earmark all funding increases for 
national service programs administered by the Corporation for National 
Service to the Administration's ``America Reads'' initiative, we urge 
the Subcommittee to recognize that our senior volunteer programs 
address many community needs beyond children's literacy. In fact, 
children's literacy services is not within the scope of the Senior 
Companion Program--a fact evidenced by the President's proposed freeze 
in Senior Companion simply because the program answers community needs 
other than children's literacy.
    Accordingly, we urge the Subcommittee to embrace funding priorities 
for the additional funds requested as follows:
  --Foster Grandparents and Senior Companions will receive a $.05/hour 
        increase in their volunteer stipend;
  --Each senior volunteer program will receive a 3-percent increase to 
        cover administrative costs, including those resulting from new 
        activities under the Programming For Impact initiative;
  --Each program will receive expansion funding to support Programs of 
        National Significance not limited to the America Reads 
        initiative, consistent with current law; and
  --The Retired and Senior Volunteer Program will receive additional 
        funding to start new programs in unserved communities.
    We believe this funding allocation plan maximizes the number of 
additional volunteers and volunteer service hours which can be 
generated for each Federal dollar invested, supports existing programs 
in maintaining their volunteer efforts, and allows for expansion of 
volunteer efforts in areas of highest community need and in areas 
currently unserved by FGP, SCP, and RSVP. All told, the funding levels 
and allocations we request would support more than 14,000 more senior 
volunteers, contributing in excess of 3 million hours annually.
    We ask that language be included in the committee report 
accompanying the fiscal year 1999 funding measure which supports and 
specifies the above allocation priorities for funds requested for 
fiscal year 1999 and directs the Corporation for National and Community 
Service to disburse funds for fiscal year 1999 in this manner.
    With Federal resources under increasing pressure as Congress moves 
toward a balanced budget by fiscal year 2002, it is critical that we 
act smart with tax dollars--drawing the best return on our investments 
in Federal programs. Since 1965, FGP, SCP, and RSVP have represented 
the best in the Federal partnership with local communities, with 
Federal dollars flowing directly to local sponsoring agencies, which in 
turn determine how the funds are used. Together, these three programs 
have proven themselves cost-effective and economical in leveraging 
Federal funds to secure a total of $93.9 million in local community 
support--an impressive $.65 for every Federal dollar invested--toward 
underwriting a total of 108 million hours of service annually in 
communities across the country. The evidence supports this claim:
  --The Foster Grandparent Program fiscal year 1997 budget of $77.812 
        million was matched with $32.0 million in cash and inkind 
        donations from states and local communities in which Foster 
        Grandparents volunteer. This represents a non-Federal match of 
        41 percent--well over the 10 percent local match required by 
        law.
  --The Retired and Senior Volunteer Program saw its fiscal year 1997 
        Federal budget of $35.708 million matched with $42 million in 
        contributions by states and local communities, demonstrating 
        broad support for RSVP across the country. This represents a 
        non-Federal match of 118 percent--well over the 30 percent 
        required by law.
      --And, the Senior Companion Program, with a Federal appropriation 
of $31.244 million in fiscal year 1997, was supplemented by $19.9 
million in cash and inkind contributions from states and local 
communities in which Companions volunteer. This represents a match of 
64 percent--far in excess of the 10 percent match required by law.
    Independent Sector has estimated the per hour value of volunteer 
service in 1997 to be $13.24 per hour. The 109+ million hours of 
service provided by the nearly 500,000 volunteers serving through RSVP, 
FGP, and SCP is valued at more than $1.4 billion, a 10-fold return on 
the Federal investment of $144.764 million in 1997. Obviously, however, 
the work of our senior volunteers means much more than money. The 
programs are a lifeline to communities and Americans of all ages.
    In 1997, 25,300 Foster Grandparent volunteers contributed 23.8 
million hours of service through 8,400 local agencies, working with 
children and teenagers who have special needs as well as their 
families. Every year, 80,000 children, teenagers, and their families 
are supported by the services of Foster Grandparents in all 50 states, 
the District of Columbia, Puerto Rico, and the Virgin Islands. Over 
14,000 Foster Grandparents serve 39,200 children in settings connected 
to the health care system. Foster Grandparents help young people 
achieve personal independence and self-confidence so that they can 
learn to overcome their problems and become productive members of 
society. The annual Federal cost for one Foster Grandparent is $3,761--
less than $4.00 per hour.
    In 1997, RSVP volunteers provided over 74 million hours of service 
in a variety of settings throughout their communities across the 
country. The total cost of fielding one RSVP volunteer is 48 per hour 
of service. All told, 453,300 RSVP volunteers serve annually through 
more than 57,000 public and non-profit local volunteer stations. Sixty-
nine percent of RSVP volunteers are over age 70. Volunteers serve 
through 758 projects sponsored and managed by local nonprofit agencies 
in all 50 States, the District of Columbia, Puerto Rico, and the Virgin 
Islands. RSVP volunteers provide services that utilize their own 
talents and interests; they present their communities with a rich array 
of options for addressing the full spectrum of community needs.
    In 1997, Senior Companion volunteers contributed 11.4 million hours 
of service to their frail older clients--giving assistance to other 
adults with physical, mental, or emotional impairments. In one year, 
13,300 Senior Companions serve nearly 48,000 clients, primarily in in-
home settings. SCP volunteers serve through 185 programs sponsored and 
managed by local nonprofit agencies in all 50 states, the District of 
Columbia, Puerto Rico, and the Virgin Islands. Senior Companions help 
frail older people achieve and maintain the highest possible level of 
independent living and avoid institutionalization. The average annual 
cost of nursing home care in the United States exceeds $30,000. The 
annual Federal cost for one Senior Companion is $3,831--less than $4.00 
per hour.
    For more than three decades, Federally-supported senior volunteers 
have been touching lives and helping communities in a variety of ways.
    Statistics show that FGP, RSVP and SCP focus their resources where 
they will have the largest impact: FGP on early intervention and 
literacy activities, SCP on in-home assignments with frail older people 
at risk of institutionalization, and RSVP on helping their peers, 
children, and their communities in significant ways. Nationally, 82 
percent of the children served by Foster Grandparents are under the age 
of 12. Recognizing that children's needs are more effectively addressed 
as early in their lives as possible, 50 percent of these children are 
age 5 and under. Foster Grandparents work intensively with these very 
young children to address their problems at as early an age as 
possible, before they enter school. One-third of FGP volunteers serve 
over 8 million hours annually addressing literacy and pre-literacy 
problems with children who have special needs. Sixty-seven percent of 
FGP volunteers serve in public and private schools as well as sites 
which provide early childhood pre-literacy services to very young 
children, including Head Start.
    Twenty-six thousand of the clients served by SCP are 75 or older, 
and 74 percent of SCP volunteers serve in the homes of clients. It is 
the 75+ elder population which most often experiences health problems 
which require institutionalization; SCP prevents institutionalization 
for these people by focusing on providing one-to-one in-home daily 
service and companionship to this population. Thirty percent of SCP 
volunteers provide respite care to families serving as primary care-
givers for an elder loved one. Fifty percent of volunteers address 
chronic care disabilities. Over ten percent of RSVP volunteers serve in 
sites which focus on school-age and pre-school age literacy activities, 
as well as adult literacy. Sixty-four percent of RSVP volunteers 
provide service to their fellow seniors through congregate meal 
programs, food banks and kitchens, senior centers, and long term care 
residential facilities.
    We appreciate the goals of the Subcommittee in exercising its best 
judgment to effect the best use of scarce Federal resources, and as 
American taxpayers, we endorse your efforts to ensure that tax dollars 
yield significant impact. We have much evidence that FGP, SCP, and RSVP 
produce results: numerous and anecdotal stories of lives changed, 
dollars saved, and lasting good works accomplished in communities 
across the country.
    This evidence is compelling, but we believe that much more is 
necessary to show that investing Federal dollars in FGP, SCP, and RSVP 
volunteers produces quantifiable, concrete results that significantly 
impact communities in measurable ways. That is why project directors 
nationwide, in cooperation with NSSC staff from the Corporation for 
National Service and with the wholehearted support of the three 
national Directors Associations, have begun to participate in a new 
effort, Programming for Impact (PFI).
    Through PFI, projects and sites where volunteers serve will 
cooperate to collect and report data which support the impact our 
volunteers are having in addressing pressing local community needs. We 
hope that you will agree that the impact data now coming in truly does 
document the incredible effect our volunteers are having in their 
communities, and supports your past Federal investment in our programs 
as well as our request for increased funds for fiscal year 1999.
  --In Clay County, Iowa, members of the Retired and Senior Volunteer 
        Program (RSVP) spearheaded a project to protect their 
        community's ground water. Working with students from Spencer 
        Middle School and youth of the Iowa Rural Water Association 
        (IRWA), 14 RSVP volunteers learned about groundwater and 
        sources of contamination, divided into work groups and surveyed 
        their community--identifying possible contaminants, collecting 
        data, and putting together an education program to get the 
        entire community involved in wellhead protection--thus ensuring 
        for future generations that the water quality in the Clay 
        County Water District remains the top quality that residents 
        enjoy now. RSVP volunteers were critical to the program, not 
        only for providing intergenerational mentoring guidance to 
        their student partners, but also for their extensive knowledge 
        of the are and its history. Their lifetime experiences have 
        proven an invaluable community resource in the program.
  --The human story of the Foster Grandparent Program is about 
        Pennsylvanian's like Ryan and his Foster Grandmother Ann 
        Creevy. If it hadn't been for Foster Grandparent Ann Creevy, 
        young Ryan might still be a statistic in a class for special 
        needs children. It was Grandma Ann who first saw the cigarette 
        burns on Ryan's arms and immediately took action when she 
        recognized these signs of abuse. During the course of working 
        with Ryan, it was Grandma Ann who identified Ryan's hearing 
        loss as the reason for his inability to learn. Several years 
        later Ryan is a thriving 12-year-old living on his new adoptive 
        home, earning excellent grades in a regular classroom. Grandma 
        Ann serves with the Union/Snyder Foster Grandparent Program in 
        Central Pennsylvania. AARP, in cooperation with Centrum Silver, 
        awarded her a Legacy Award in recognition of her efforts on 
        behalf of Ryan, whose life she saved and changed forever, and 
        the other children she serves.
  --Mr. W.H. of Belleville, Illinois, who will be 76 in May, had a 
        severe stroke in 1994. It left him unable to speak other than a 
        few words. His wife, who is the primary caregiver, has had a 
        Senior Companion two days a week since 1995. Because of the 
        Senior Companion, Mrs. H is now able to cope with the 
        situation. She can leave her husband to run errands, get 
        groceries, keep doctors' appointments, and more, without the 
        constant worry about his well-being. The respite care provided 
        by the Senior Companion allows Mrs. H. to satisfy the full time 
        care giving responsibilities she has assumed for her husband of 
        many years. However, there is a waiting list for this service 
        and the center operates at capacity each day. Senior Companions 
        allow fewer staff to serve more clients by providing one on one 
        support to the clients in the most need. They assist with 
        activities of daily living such as helping with clothing and 
        personal tasks and assisting at meal times. Additionally, the 
        Senior Companions are watchful for client concerns and safety 
        issues that can be relayed to appropriate staff. This support 
        for families caring for their elders helps avoid the annual 
        cost of nursing home care and keeps loved one together.
    As baby boomers age, the ``graying of America'' is progressing at a 
phenomenal rate. Yet, only 5 percent of those over 65 years of age live 
in institutions, and a full 81 percent of the non-institutionalized 65+ 
population has no limitation in their activities of daily living. 
According to a U.S. Administration on Aging/Marriott Senior Living 
Services volunteerism survey, over 41 percent (15.1 million) of the 
37.7 million Americans 60 years of age and older performed some sort of 
volunteer work in the previous year. An additional 37.5 percent (14 
million) indicated they would volunteer if they were asked. The message 
is clear: in spite of the general public's conception of older people 
as frail and dependent, the aging process is, for most people, a time 
of wellness when they have both the time and the desire to serve 
others.
    We need more funds to engage more seniors in meeting the pressing 
needs being expressed by our communities. Your enhanced investment in 
all three senior volunteer programs now will pay off in the short and 
long term--savings realized by the value of service rendered to 
communities across America by senior volunteers; savings realized as 
additional avenues are provided for more older Americans to be involved 
in meaningful service opportunities; and savings realized as that 
involvement keeps older people healthy and independent. Our goal is to 
expand the Foster Grandparent Program, the Senior Companion Program, 
and the Retired and Senior Volunteer Program so that they can provide 
the opportunity for one million Americans to serve by the turn of the 
century.
    Please help us to tap the nation's fastest growing natural 
resource--our seniors--by supporting a total fiscal year 1999 
appropriation of $173.910 for the programs of the National Senior 
Service Corps: $93.256 million for the Foster Grandparent Program; 
$37.653 million for the Senior Companion Program; and $43.001 million 
for the Retired and Senior Volunteer Program.


       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page
Alexander, Duane, M.D., Director, National Institute of Child 
  Health and Human Development, National Institutes of Health, 
  Department of Health and Human Services........................   191
    Prepared statement...........................................   222
Allen, W. Ron, president, National Congress of American Indians, 
  prepared statement.............................................   331
Allswang, Scott, chairman of the board of trustees, Crohn's and 
  Colitis Foundation of America, Inc., prepared statement........   353
American Academy of Family Physicians, prepared statement........   465
American Academy of Pediatrics, prepared statement...............   495
American Academy of Physician Assistants, prepared statement.....   596
American Association for Cancer Research, prepared statement.....   537
American Association of Blood Banks, prepared statement..........   568
American Association of Dental Schools, prepared statement.......   589
American Association of Health Plans, prepared statement.........   518
American Association of Nurse Anesthetists, prepared statement...   622
American Association of Retired Persons, prepared statement......   601
American College of Emergency Physicians, prepared statement.....   442
American College of Preventive Medicine and the Association of 
  Teachers of Preventive Medicine, prepared statement............   525
American College of Rheumatology, prepared statement.............   513
American Council on Education, prepared statement................   697
American Dental Association, prepared statement..................   598
American Foundation for the Blind, prepared statement............   562
American Indian Higher Education Consortium, prepared statement..   681
American Lung Association and the American Thoracic Society, 
  prepared statement.............................................   611
American Medical Association, prepared statement.................   433
American Nurses Association, prepared statement..................   469
American Optometric Association, prepared statement..............   658
American Physiological Society, prepared statement...............   657
American Psychiatric Association, prepared statement.............   604
American Society of Clinical Oncology, prepared statement........   527
American Society of Tropical Medicine and Hygiene, prepared 
  statement......................................................   552
Ammerman, Howard K., Ph.D., on behalf of the U.S. Institute of 
  Peace, prepared statement......................................   718
Association for Health Services Research, prepared statement.....   502
Association of America's Public Television Stations, prepared 
  statement......................................................   730
Association of Maternal and Child Health Programs, prepared 
  statement......................................................   437

Battey, James F., Jr., M.D., Director, National Institute on 
  Deafness and Other Communication Disorders, National Institutes 
  of Health, Department of Health and Human Services.............   191
    Prepared statement...........................................   236
Beck, Deb, president, Drug and Alcohol Service Providers 
  Organization of Pennsylvania, prepared statement...............   504
Belletto, Peter, president, National Indian Impacted Schools 
  Association, Ganado Unified School District, Ganado, AZ, 
  prepared statement.............................................   712
Berg, Steven R., director of program, National Alliance to End 
  Homelessness, Inc., prepared statement.........................   483
Bickers, Dr. David R., secretary-treasurer, on behalf of the 
  Society for Investigative Dermatology, prepared statement......   481
Bond, Hon. Christopher, U.S. Senator from Missouri...............   293
Bosch, Erin, on behalf of the National Coalition for Heart and 
  Stroke Research, prepared statement............................   630
Bumpers, Hon. Dale, U.S. Senator from Arkansas...............9, 67, 140
Bye, Dr. Raymond E., Jr., associate vice president for research, 
  Florida State University, prepared statement...................   386
Byrd, Hon. Robert C., U.S. Senator from West Virginia............     3
    Questions submitted by.....................................109, 182

Cassman, Marvin, M.D., Director, National Institute of General 
  Medical Services, National Institutes of Health, Department of 
  Health and Human Services......................................   191
    Prepared statement...........................................   220
Clapp, Katherine N., president, Fraxa Research Foundation, 
  prepared statement.............................................   510
Coalition of Northeastern Governors, prepared statement..........   355
Cochran, Hon. Thad, U.S. Senator from Mississippi................     6
    Prepared statement...........................................   275
    Questions submitted by.....................................178, 292
Cody, Jannine D., Ph.D., president, the Chromosome 18 Registry 
  and Research Society, prepared statement.......................   446
Cohen, Ellen Glesby, president and founder, Lymphoma Research 
  Foundation of America, prepared statement......................   413
Coling, George, executive director, on behalf of the National 
  Fuel Funds Network, prepared statement.........................   476
College on Problems of Drug Dependence, prepared statement.......   539
Collins, Father T. Byron, S.J., special assistant to the 
  president, Georgetown University, prepared statement...........   617
Collins, Francis S., M.D., Director, National Human Genome 
  Research Institute, National Institutes of Health, Department 
  of Health and Human Services...................................   192
    Prepared statement...........................................   251
Council of State Administrators of Vocational Rehabilitation, 
  prepared statement.............................................   607
Craig, Hon. Larry E., U.S. Senator from Idaho:
    Prepared statement...........................................   285
    Questions submitted by.....................................102, 316

Day, Arthur L., M.D., on behalf of the American Association of 
  Neurological Surgeons, prepared statement......................   620
De La Cruz, Antonio, M.D., FACS, president, American Academy of 
  Otolaryngology-Head and Neck Surgery, Inc., prepared statement.   618
DeBakey, Dr. Michael E., heart surgeon, on behalf of the Friends 
  of the National Library of Medicine [NLM], prepared statement..   429
Deitch, Patricia, chief executive officer, Philadelphia Health 
  Services, on behalf of the National Association of Community 
  Health Centers, prepared statement.............................   377
DeParle, Nancy-Ann, Administrator, Health Care Financing 
  Administration.................................................    59
    Letter from..................................................    82
DeRocco, Emily S., executive director, Interstate Conference of 
  Employment Security Agencies, prepared statement...............   489
Digiusto, Walter, president, ESA, Inc., prepared statement.......   626
Donaldson, Peter J., president, Association of Population Centers 
  [APC], prepared statement......................................   642
Downing, Carole S., MSW, on behalf of the National Multiple 
  Sclerosis Society, prepared statement..........................   579

Faircloth, Hon. Lauch, U.S. Senator from North Carolina........100, 146
    Questions submitted by.......................................   309
Fauci, Anthony S., M.D., Director, National Institute of Allergy 
  and Infectious Diseases, National Institutes of Health, 
  Department of Health and Human Services........................   191
    Prepared statement...........................................   216
FDA-NIH Council, prepared statement..............................   550
Finkelstein, Leonard H., D.O., chairman, board of governors, 
  American Association of Colleges of Osteopathic Medicine, 
  prepared statement.............................................   475
Ford, Michael Q., executive director, the National Nutritional 
  Foods Association, prepared statement..........................   415
Franklin, Patricia, MSN, RN, CPNP, president, National 
  Association of Pediatric Nurse Associates and Practitioners, 
  prepared statement.............................................   440
Fraser, Heather R., on behalf of the Cystic Fibrosis Foundation, 
  prepared statement.............................................   543
Furmanski, Phillip, Ph.D., dean, faculty of arts and science; 
  chairman and professor of biology on behalf of a Center for 
  Cognition, Learning, Emotion, and Memory at New York 
  University, prepared statement.................................   349
Fye, W. Bruce, M.D., M.A., F.A.C.C., chair, Marshfield Clinic, 
  Department of Cardiology, on behalf of the American College of 
  Cardiology, prepared statement.................................   665

Geisel, Ritchie L., president, Recording for the Blind and 
  Dyslexic [RFB&D], prepared statement...........................   388
George, Father William L., S.J., special assistant to the 
  president, Georgetown University, prepared statement...........   617
Gipp, David M., president, Three Affiliated Tribes of North 
  Dakota, prepared statement.....................................   709
Gorden, Philip, M.D., Director, National Institute for Diabetes 
  and Digestive and Kidney Diseases, National Institutes of 
  Health, Department of Health and Human Services................   191
    Prepared statement...........................................   210
Gordis, Enoch, M.D., Director, National Institute on Alcohol 
  Abuse and Alcoholism, National Institutes of Health, Department 
  of Health and Human Services...................................   192
    Prepared statement...........................................   245
Gorosh, Kathye, project director, the Core Center, prepared 
  statement......................................................   422
Grady, Patricia A., M.D., Director, National Institute of Nursing 
  Research, National Institutes of Health, Department of Health 
  and Human Services.............................................   192
    Prepared statement...........................................   248
Grant, Glenn A., Esq., business administrator, city of Newark, 
  prepared statement.............................................   493
Greenberg, Warren, Ph.D., professor, health economics and health 
  care sciences, George Washington University, on behalf of 
  Mended Hearts, Inc., prepared statement........................   669
Guinane, Kay, consulting attorney, National Consumer Law Center, 
  prepared statement.............................................   345
Gustafson, John S., executive director, National Association of 
  State Alcohol and Drug Abuse Directors, Inc., prepared 
  statement......................................................   575

Harkin, Hon. Tom, U.S. Senator from Iowa.........................     8
    Prepared statement...........................................   285
    Questions submitted by.....................................105, 319
Helen Keller National Center for Deaf Blind Youths and Adults, 
  prepared statement.............................................   609
Henderson, Carol C., executive director, Washington office, the 
  American Library Association, prepared statement...............   705
Herman, Hon. Alexis, Secretary of Labor, Office of the Secretary, 
  Department of Labor............................................   125
    Prepared statement...........................................   128
Herrera, Stanley, president, Alamo Navajo School Board, prepared 
  state-
  ment...........................................................   703
Heylin, G. Brockwel, director, government affairs, the American 
  Association of Colleges of Nursing, prepared statement.........   382
Heymann, Dr. David L., on behalf of the World Health 
  Organization, prepared statement...............................   400
Hill, Martha, R.N., Ph.D., president, American Heart Association, 
  prepared statement.............................................   674
Hodes, Richard J., M.D., Director, National Institute on Aging, 
  National Institutes of Health, Department of Health and Human 
  Services.......................................................   191
    Prepared statement...........................................   231
Hollings, Hon. Ernest, U.S. Senator from South Carolina..........     1
Hutcheson, Rev. Gary, volunteer advocate, on behalf of the 
  National Psoriasis Foundation, prepared statement..............   668
Hutchison, Hon. Kay Bailey, U.S. Senator from Texas..............   104
    Questions submitted by.......................................   179
Hyman, Steven E., M.D., Director, National Institute of Mental 
  Health, National Institutes of Health, Department of Health and 
  Human Services.................................................   192
    Prepared statement...........................................   240

Jacob, Dr. Harry S., on behalf of the American Society of 
  Hematology, prepared statement.................................   479
Janger, Stephen A., president, Close Up Foundation, prepared 
  statement......................................................   691
Joint Council of Allergy, Asthma and Immunology, prepared 
  statement......................................................   545
Jollivette, Cyrus M., vice president for government relations, 
  University of Miami, prepared statement........................   359
Jones, Wanda K., Dr. P.H., on behalf of the Public Health Service 
  Office on Woman's Health, Department of Health and Human 
  Services, prepared statement...................................   565

Kalabokes, Vicki, chief executive officer, National Alopecia 
  Areata Foundation, prepared statement..........................   385
Kalabokes, Vicki, co-chair, Coalition of Patient Advocates for 
  Skin Disease Research [CPA-SDR], prepared statement............   432
Karlson, David, executive director, Society of General Internal 
  Medicine, prepared statement...................................   368
Katz, Stephen I., M.D., Director, National Institute of Arthritis 
  and Musculoskeletal and Skin Diseases, National Institutes of 
  Health, Department of Health and Human Services................   191
    Prepared statement...........................................   233
Kaufman, Paul L., M.D., president, Association for Research in 
  Vision and Ophthalmology, prepared statement...................   524
Kenney, K. Kimberly, executive director, Chronic Fatique Immune 
  Dysfunction Syndrome [CFIDS] Association of America, prepared 
  statement......................................................   571
Kern, Jeffrey, M.D., president, American Federation for Medical 
  Research, prepared statement...................................   637
Kingsley, Roger P., on behalf of the American Speech-Language 
  Hearing Association, prepared statement........................   645
Kirschstein, Ruth, M.D., Deputy Director, National Institute of 
  Health, Department of Health and Human Services................   191
Klausner, Richard, M.D., Director, National Cancer Institute, 
  National Institutes of Health, Department of Health and Human 
  Services.......................................................   191
    Prepared statement...........................................   203
Kohl, Hon. Herb, U.S. Senator from Wisconsin.....................   143
    Prepared statements.........................................72, 145
    Questions submitted by.....................................106, 187
Kramis, Ron, Ph.D., on behalf of the Fibromyalgia Network, 
  prepared statement.............................................   531
Kraut, Alan G., Ph.D., executive director, American Psychological 
  Society, prepared statement....................................   670
Krueger, Gerald G., M.D., chairman, American Academy of 
  Dermatology, prepared statement................................   585
Kupfer, Carl, M.D., Director, National Eye Institute, National 
  Institutes of Health, Department of Health and Human Services..   191
    Prepared statement...........................................   225

Lancaster, Ronny B., M.B.A., J.D., president, Association of 
  Minority Health Professions Schools, prepared statement........   443
LaPahe, Tom, council delegate, Pinon Health Center Project, 
  Pinon, Navajo Nation (Arizona), prepared statement.............   429
Lavery, Jack, chairman of the board, the Lupus Foundation of 
  America, prepared statement....................................   631
Lenfant, Claude, M.D., Director, National Heart, Lung, and Blood 
  Institute, National Institutes of Health, Department of Health 
  and Human Services.............................................   191
    Prepared statement...........................................   205
Leshner, Alan I., M.D., Director, National Institute on Drug 
  Abuse, National Institutes of Health, Department of Health and 
  Human Services.................................................   192
    Prepared statement...........................................   242
Lewis, Delano E., president and CEO, National Public Radio, 
  prepared statement.............................................   735
Lewis, Rosalie, president, Dystonia Medical Research Foundation, 
  prepared statement.............................................   455
Licursi, Michele, on behalf of the Foundation for Ichthyosis and 
  Related Skin Types [FIRST], prepared statement.................   663
Licursi, Ryan, on behalf of the Foundation for Ichthyosis and 
  Related Skin Types [FIRST], prepared statement.................   663
Lindberg, Donald A.B., M.D., Director, National Library of 
  Medicine, National Institutes of Health, Department of Health 
  and Human Services.............................................   192
    Prepared statement...........................................   260
Lorenzo, Martha Jean, prepared statement.........................   703
Lokovic, C.M. Sgt. James E., USAF (Ret.) director, military and 
  government relations, Air Force Sergeants Association, prepared 
  statement......................................................   694
Ludlam, Chuck, on behalf of the Biotechnology Industry 
  Organization, prepared statement...............................   646

Mahood, Dr. William H., president, Digestive Disease National 
  Coalition, prepared statement..................................   392
Markey, Patricia E., legislative consultant, United Distribution 
  Companies, prepared statement..................................   336
Mason, Russell, board president and chairman, Three Affiliated 
  Tribes of North Dakota, prepared statement.....................   716
Mauderly, Joe L., senior scientist and director of external 
  affairs, Lovelace Respiratory Research Institute, prepared 
  statement......................................................   581
McAfee, Robert E., M.D., chair, on behalf of the Join Together 
  National Policy Panel on Addiction Treatment and Recovery, 
  prepared statement.............................................   356
McCoy, Clyde B., professor and chair, Department of Epidemiology 
  and Public Health, director, Health Services Research Center, 
  prepared statement.............................................   361
Mead, Dr. Rodney, professor of zoology, director of NIH IDeA 
  Program, University of Idaho, prepared statement...............   380
Megerson, John S., director of police, on behalf of the Southwest 
  Texas State University, prepared statement.....................   684
Meltzer, Donna, on behalf of the American Association of 
  University Affiliated Programs for Persons With Developmental 
  Disabilities, chair, on behalf of the Friends of NICHD 
  Coalition, prepared statement..................................   654
Mendell, Lorne M., Ph.D., on behalf of the Society for 
  Neuroscience, prepared statement...............................   632
Moore, David B., coordinator, Health Professions and Nursing 
  Education Coalition, prepared statement........................   403
Moss, Sharon, on behalf of the American Speech-Language Hearing 
  Association, prepared statement................................   645
Munro, Nancy, RN, MN, CCRN, on behalf of the American Association 
  of Critical Care Nurses [AACN], prepared statement.............   412
Murray, Karen, member, National Marfan Foundation, on behalf of 
  the Coalition for Heritable Disorders of Connective Tissue, 
  prepared statement.............................................   472
Myers, Terry-Jo, Interstitial Cystitis Association, prepared 
  statement......................................................   616

National Aging and Vision Network, prepared statement............   561
National Alliance for Eye and Vision Research, prepared statement   557
National Association for State Community Services Programs, 
  prepared statement.............................................   515
National Association of Addiction Treatment Providers, prepared 
  statement......................................................   393
National Association of Nutrition and Aging Services Programs, 
  prepared statement.............................................   375
National Coalition for Cancer Research, prepared statement.......   547
National Council on Rehabilitation Education, prepared statement.   395
National Deppressive and Manic-Depressive Association, prepared 
  state-
  ment...........................................................   556
National Federation of Community Broadcasters, prepared statement   733
National Hemophilia Foundation, prepared statement...............   366
National Indian Education Association, prepared statement........   686
National Job Corps Coalition, prepared statement.................   342
National Kidney Foundation, prepared statement...................   508
National Military Family Association, prepared statement.........   714
National Minority Public Broadcasting Consortia, prepared 
  statement......................................................   738
National Rural Health Association, prepared statement............   389
Neylan, Dr. John F., president-elect, American Society of 
  Transplant Physicians, prepared statements...................397, 451
Niesing, Ron, president, the National Council of Social Security 
  Management Associations, Inc., prepared statement..............   742
Nieves, Josephine, MSW, Ph.D., executive director, National 
  Association of Social Workers, prepared statement..............   494

O'Toole, Patrice, assistant director, Federation of Behavioral, 
  Psychological and Cognitive Sciences, prepared statement.......   678
Olden, Kenneth, M.D., Director, National Institute of 
  Environmental Health Sciences, National Institutes of Health, 
  Department of Health and Human Services........................   191
    Prepared statement...........................................   228

Paulk, Crystal J., on behalf of the Society of Professional 
  Journalists, prepared statement................................   699
Pease, Joanne Bakke, Immune Deficiency Foundation, prepared 
  statement......................................................   628
Pebley, Anne R., president, Population Association of America 
  [PAA], prepared statement......................................   642
Penn, Audrey S., M.D., Acting Director, National Institute of 
  Neurological Disorders and Stroke, National Institutes of 
  Health, Department of Health and Human Services................   191
    Prepared statement...........................................   214
Perez, Daniel Paul, president, Facioscapulohumeral Society, 
  prepared statement.............................................   521
Pings, Cornelius J., president, Association of American 
  Universities, prepared statement...............................   567
Population Association of America [PAA] and the Association of 
  Population Centers [APC], prepared statement...................   534
Priest, Roy O., president, National Congress for Community and 
  Economic Development, prepared statement.......................   340
Puckett, Marianne, associate professor of medical library 
  science, Louisiana State University Medical Center Library, on 
  behalf of the Medical Library Association and the Association 
  of Academic Health Sciences Libraries, prepared statement......   625

Rasmussen, Dwight, president, National Association of Senior 
  Companion Project Directors, prepared statement................   745
Reich, Gloria E., Ph.D., executive director, American Tinnitus 
  Association, prepared statement................................   635
Research Society on Alcoholism, prepared statement...............   542
Richardson, Alan H., executive director, American Public Power 
  Association, prepared statement................................   504
Richter, Mary Kaye, on behalf of the National Foundation for 
  Ectodermal Dysplasias, prepared statement......................   660
Rider, Dr. J. Alfred, president, board of trustees, Children's 
  Brain Diseases Foundation, prepared statement..................   464
Riley, Hon. Richard W., Secretary of Education, Office of the 
  Secretary of Education, Department of Education................     1
    Prepared statement...........................................    13
Rock Point Community School Board, Rock Point, AZ, prepared 
  statement......................................................   707
Rogers, Hon. Paul G., on behalf of the Friends of the National 
  Library of Medicine [NLM], prepared statement..................   429
Rotary International, prepared statement.........................   417
Rumery-Rhodes, Allison, on behalf of the Sudden Infant Death 
  Syndrome Alliance, prepared statement..........................   457

Saperstein, Dr. Lee W., dean, School of Mines and Metallurgy, 
  University of Missouri-Rolla, prepared statement...............   529
Schambra, Philip E., M.D., Director, Fogarty International 
  Center, Department of Health and Human Services................   192
    Prepared statement...........................................   258
Schwartz, Peter E., M.D., president, Society of Gynecologic 
  Oncologists, prepared statement................................   453
Scrimshaw, Susan, Ph.D., dean, University of Illinois School of 
  Public Health, on behalf of the Association of Schools of 
  Public Health, prepared statement..............................   460
Shalala, Hon. Donna, Secretary of Health and Human Services, 
  Office of the Secretary, Department of Health and Human 
  Services.......................................................    59
    Letter from..................................................   108
    Prepared statement...........................................    63
Shalita, Alan, M.D., president, Association of Professors of 
  Dermatology, prepared statement................................   594
Skelly, Thomas P., Director, Budget Service, Department of 
  Education......................................................     1
Slavkin, Harold, M.D., Director, National Institute of Dental 
  Research, National Institutes of Health, Department of Health 
  and Human Services.............................................   191
    Prepared statement...........................................   207
Smith, Dr. M. Susan, on behalf of the Regional Primate Research 
  Centers Program, prepared statement............................   373
Society of Toxicology, prepared statement........................   554
Specter, Hon. Arlen, U.S. Senator from Pennsylvania.....1, 59, 125, 192
    Prepared statements......................................2, 60, 126
Stevens, Christine, secretary, Society for Animal Protective 
  Legislation, prepared statement................................   639
Stevens, Hon. Ted, U.S. Senator from Alaska, questions submitted 
  by.............................................................    44
Suki, Wadi N., M.D., president, American Society of Nephrology, 
  prepared statement.............................................   448

Tanski, Tish, president, Association of Independent Research 
  Institutes, prepared statement.................................   634
Tobias, Robert M., national president, National Treasury 
  Employees Union, prepared statement............................   485
Tri-Council for Nursing, prepared statement......................   426

University of Medicine and Dentistry of New Jersey [UMDNJ], 
  prepared statement.............................................   363

Vaitukaitis, Judith L., M.D., Director, National Center for 
  Research Resources, Department of Health and Human Services....   192
    Prepared statement...........................................   255
Varmus, Harold E., M.D., Director, National Institutes of Health, 
  Department of Health and Human Services........................   191
    Prepared statement...........................................   194
Ventre, Francis T., president, Montgomery County [MD] Stroke 
  Club, prepared statement.......................................   629

Watkins, Jane, president, National Association of Foster 
  Grandparent Program Directors, prepared statement..............   745
Whitescarver, Jack, M.D., Acting Director, Office of AIDS 
  Research, National Institutes of Health, Department of Health 
  and Human Services.............................................   192
    Prepared statement...........................................   200
Williams, Dennis P., Deputy Assistant Secretary for Budget, 
  Department of Health and Human Services........................   192
Wilson, Robert, on behalf of the Wilson Foundation on 
  Neurofibromatosis, prepared statement..........................   420
Wofford, Harris, chief executive officer, Corporation for 
  National Service, prepared statement...........................   720
Woolley, Mary, president, Research!America, prepared statement...   371

York, Nan, president, National Association of Retired and Senior 
  Volunteer Program Directors, prepared statement................   745
Yount, Ralph G., president, Federation of American Societies for 
  Experimental Biology, prepared statement.......................   370


                             SUBJECT INDEX

                              ----------                              

                        DEPARTMENT OF EDUCATION
                  Office of the Secretary of Education

                                                                   Page
Additional committee questions...................................    29
After-school programs............................................18, 28
America Reads Challenge.......................................... 6, 21
Bilingual and immigrant education................................    28
Block grants and local control...................................    26
Budget offsets--tobacco settlement and user fees.................    16
Campus Security Act panel........................................    18
Class size reduction--use of parochial classrooms................    17
Closed captioning................................................24, 26
Community learning centers, 21st century.........................    18
Education funds going directly to students and teachers..........    22
Federal education:
    Funding......................................................     9
    Initiatives..................................................     9
Fiscal year 1999 education budget request........................    10
GAO study on block grants........................................    27
House directive on convening reading research panel..............     7
Impact aid.......................................................    27
Interest rate on student loans...................................    23
Local control....................................................    25
Math and science achievement.....................................    15
    TIMSS........................................................    19
Mississippi Delta:
    Early childhood services project.............................    20
    Project--Easter Seals Foundation.............................    20
National writing project.........................................    22
NIH research on reading..........................................     6
Parental involvement...........................................4, 5, 16
Partnership programs designed to raise standards.................    12
Programs:
    Mott Foundation funds for after-school.......................    18
    To reform failing schools....................................    11
    Youth violence and after-school..............................    18
Raising expectations, standards, and teacher preparation.........    11
``Readline'' and ``Mathline''....................................    22
Reading programs increases.......................................    10
Robert C. Byrd honors scholarships...............................     3
School uniforms..................................................    23
Special education budget increases...............................    27
Student financial assistance proposals...........................    12
Teacher training:
    Model........................................................     8
    Technology initiative........................................    12
Third international mathematics and science study................ 3, 10
TIMSS results....................................................     4
Title I allocation formula.......................................     7
    Revision.....................................................    22

                DEPARTMENT OF HEALTH AND HUMAN SERVICES
                     National Institutes of Health

Additional committee questions...................................   286
Alternative medicine.............................................   268
    Abroad.......................................................   271
    Request for comprehensive account of Federal activities in...   270
Alzheimer's disease..............................................   267
    Delaying.....................................................   266
    Funding for..................................................   266
Antibiotic resistance............................................   281
Average length of grant awards...................................   279
Budget submission................................................   263
Children learning to read........................................   277
Clinical trials..................................................   272
    System.......................................................   264
Cure for ebola...................................................   280
Declining efficacy of antibiotics................................   280
Diabetes research workshop.......................................   276
Epilepsy.........................................................   273
    Access to treatment..........................................   274
    Funding......................................................   273
Ergonomics research..............................................   283
Grant funding..................................................264, 279
    Policy.......................................................   265
Heart disease, status of.........................................   267
Increase funding.................................................   193
International collaborations on infectious disease outbreaks.....   281
NCI bypass budget................................................   264
New clinical investigators.......................................   272
Office of Alternative Medicine, funding for......................   269
Parkinson's disease..............................................   267
Progress of HIV/AIDS research....................................   271
Research on reading disability...................................   278
Translation of research..........................................   275

                        Office of the Secretary

Abuse:
    Elder........................................................    71
    Fraud and....................................................    76
Additional committee questions...................................    92
After-school programs............................................    71
    Federal......................................................    70
Bill of rights, patients'........................................    73
Child immunization...............................................    78
Disease prevention...............................................    75
EPO dosage, reduction in.........................................    69
Epogen policy, revisions to......................................    80
Home health surety bond..........................................    77
Nurse anesthetists...............................................    74
President's child care initiative................................    72
Senator Bumpers, tribute to......................................    67
Tobacco legislation..............................................    79
Two HCFA concerns................................................    68

                  Health Care Financing Administration

Additional committee questions...................................   112
Class action suits...............................................    91
EPO, overutilization of..........................................    82
Ergonomics issue.................................................    90
Flu outbreak.....................................................    88
HCFA action......................................................    84
Two HCFA concerns................................................    68
Viruses..........................................................    87

                          DEPARTMENT OF LABOR
                        Office of the Secretary

Additional committee questions...................................   149
Budget request, NLRB.............................................   149
Employee Retirement Income Security Act..........................   146
DOL strategic goals..............................................   127
ERISA, cost of expanding.........................................   147
Job training programs............................................   137
North Carolina formula grant waiver..............................   148
OSHA inspectors, training of.....................................   141
Pabst retiree health care coverage...............................   144
Poultry industry, targeting of...................................   142
Welfare to work..................................................   138
    Coordination.................................................   139
Youth offender demonstration grants..............................   140