[Mr. Hutchinson's prepared statement follows:]

STATEMENT OF ORION N. HUTCHINSON, JR., CHAIRMAN, COMMUNITY MENTAL HEALTH CENTERS COMMITTEE, NATIONAL ASSOCIATION FOR MENTAL HEALTH My name is Orion Hutchinson. I reside in Greensboro, North Carolina, where I am Superintendent of the Greensboro District, United Methodist Church. I am Chairman of the Community Mental Health Centers Committee of the National Association for Mental Health, and I serve on the Association's Public Affairs Committee. I have served on both the Executive Committee and Board of Directors of that organization, in whose behalf I am appearing today.

The National Association for Mental Health is the national citizens' voluntary organization working toward the improved care and treatment of the mentally ill; for improved methods and services in research, prevention, detection, diagnosis and treatment of mental illness; and for the promotion of mental health.

I have been an active citizen-volunteer in the field of Mental Health for seventeen years. I have served as President of the North Carolina Mental Health Association and have been President of the Davidson County Mental Health Association in North Carolina. I have also served as a member representing citizen-laymen concerns and interests on the following bodies: State Legislative Council (Vice President).

Thomasville Chamber of Commerce (Vice President).

Board of Education, Thomasville, North Carolina, School System.

Our Association is very pleased that H.R. 7806, the legislation which was introduced in the House, passed by the overwhelming vote of 372 to 1. This important measure will permit the Congress time to thoughtfully review the CMHC Act and make appropriate changes.

We are very concerned with the Administration's position which would discontinue funding of new CMHC's. The rationale given by the Administration regarding why they have chosen this approach raises more questions than it answers. We would like to address our opening remarks to the CMHC concept, give our answers to the Administration's position regarding renewal, and provide information regarding changes we recommend in the current CMHC Act. The Community Mental Health Center is a health service delivery system already Federally funded in more than 500 communities in which approximately 35% of the Nation's population lives. It embodies many of the attributes held in highest regard by the present Administration. Yet, the Administration proposes to discontinue further Federal support with a seeming disregard for whether this system which it has praised can in fact survive the sudden withdrawal of support.

The attributes of the Community Mental Health Center system include: 1. Comprehensiveness-It encompasses within a single system all of the related services available to serve the population for which it is responsible.

2. Coordination-The services contained in this system are organized into a continuum enabling the patient to move freely and easily from one service to another as needed without the duplication of effort and cost present when services are unrelated and uncoordinated.

3. The Program is designed to serve the total population of its designated geographic area. It is not a program developed specifically for the poor or any other class within the community.

4. The funds allocated go almost entirely into services for the persons in need. Very little money is used for the support of a bureaucracy.

5. There is a high degree of local responsibility. Controls and direction are provided by local volunteer boards.

6. The Center Program, which was to be initiated in each catchment or population area with Federal funding on a diminishing basis has moved steadily toward ultimate support by state and local government and private sources. Only about 30% of the money invested annually in operating the Community Mental Health Center Program now comes from Federal funds. 44% comes from local and state government; 20% comes from patient fees and forms of insurance.

7. The Program is not one which was developed and put together hastily in response to a crisis, but evolved out of ten years of thoughtful deliberations with extensive community planning at state and local levels. The planning process was initiated during the Eisenhower Administration, and the Program has had the continued support of each Administration since.

8. The Center system is designed in such a fashion that it is compatible with any proposed comprehensive plan for total health care delivery and thus might be joined as an already operating component.

9. Despite commonly held false assumptions, mental health services are demonstrably insurable within a plan of National Health Insurance.

10. The Center System encourages community care with a minimum of institutional confinement which means that to the extent possible, the patient is responsible for the fulfillment of his own treatment plan which continuing as a selfreliant, tax-paying member of the community. The Community Mental Health Center has already played a major role in the reduction of state hospital census by a dramatic 36% in the last five years, in closing a number of state hospitals in several states and in making a sharp reduction in the amount of funds expended in the construction of new institutions.

11. The Center system places major attention on the development of a preventive approach with better and more efficient utilization of limited professional manpower.

Why, then, does the Administration propose to place a program so much in accord with its own stated objectives in serious jeopardy by the abrupt termination of its financial assistance? Several reasons have been offered for its action: 1. The Program was intended to be a demonstration. It has now been demonstrated to be successful and effective and should therefore be picked up by funding from other sources.-The problem lies in the definition of "demonstration". It is clear that those who wrote the original legislation did not intend that Federal support would continue undiminished and forever. Funding grants were to be for a term of eight years and provision was made for diminishing Federal participation during that eight-year period. Thus, Federal funding was to serve a pump priming purpose. It was also to demonstrate to each community the merits of the program and the capability of each community to pick up gradually the financing of its own center. Congress set as its goal that a mental health center should be established in as many catchment areas as necessary to serve the total population of the country. It was not the intent of Congress when the initial legislation was enacted to assist a few favored communities to have centers and then to leave to chance the spread of the program elsewhere.

2. The Program will be funded through National Health Insurance.—Unfortunately, National Health Insurance does not yet exist nor does it seem imminent. In addition, it must be recognized that even if National Health Insurance might support the continuation of an existing Community Mental Health Center, it would not, as a fee-for service mechanism, provide the funding for consultation services, which are a major component of the preventive function. Nor would insurance provide funding for the initiation of new and needed centers where they do not already exist.

3. The Program can be supported and Centers can be initiated through revenue sharing.-Without debating what may prove to be the eventful virtues of the revenue sharing approach to Federal participation in local programs, there seems to be a callous disregard for reality in proposing this solution. There is no evidence that revenue sharing will be so effective immediately that each of the many programs which apparently are expected to derive their support from this source will each receive its equitable share without interruption of service and irreparable damage. Neither can anyone be sanguine about the prospects of equitable consideration in the intense competition which will take place not only between established programs but also with those which may be opportunistically devised in response to state and local special pressures. Further doubts arise concerning revenue sharing as a solution because of the tendency on the part of state and local governments to use the funds shared with the mfor onetime capital expenditures rather than for programs involving long-term financial commitments. Then, there are indications that all the programs which are supposedly to be supported by revenue sharing are going to have to be financed with what appears to be less dollars than are currently available through present funding arrangements.

Finally, we are deeply concerned about an approach to financing which does not provide for a continuing Federal regulating relationship. Though a substantial part of the funding may come from other sources and though program control and management may be local, uniform standards of practice and performance established by the Federal Government are highly desirable.

4. The Federal grant program for Community Mental Health Centers has resulted in an inequitable distribution of services with certain states and the communities receiving a disproportionate amount of the funds available. It is true

that some states were better prepared to move ahead than others and have attained a more rapid and complete coverage of the population of their states. It hardly makes sense, however, to deprive those states which have been confronted with greater difficulty in proceeding simply because the funds have been inequitably distributed to this point. To do so would be to perpetuate the inequity. With due regard for the concerns of the Administration as expressed explicitly and implicitly in the reasons given for discontinuance of Federal support, there is still an important role which can be properly and appropriately played by the Federal Government.

We believe the following four recommendations are realistic in terms of Federal government involvement in the Community Mental Health Center Program and its development to the high level of its potential.

1. That Federal funding continue for the purpose of assuring the initiation of a Community Mental Health Center in each of the 1500 catchment areas required to encompass the total national population. Presently, there are 493 centers Federally funded and a small number financed in other ways. This means there are at least 900 catchment areas for which centers must still be planned and initial funding secured. Continued Federal participation should at least make available an initial eight-year staffing grant for the support of a properly designed and approved mental health center in every catchment area still unserved by such a center. June 30, 1980, should be regarded as the target date for comprehensive national coverage with initial staffing grants.

2. That a ceiling be placed on the amount which can be allocated to any one center in order to avoid giving undue advantage to those having unusual grantwriting skills and in order to provide for an equitable distribution of available dollars to all catchment areas. Such a ceiling should be based upon a formula taking into account appropriate variables to be established by regulation.

3. That there be a continuation of preferential funding for centers serving poverty areas with the requirement that the additional dollars allocated to such preferential funding be used for the provision of services to the poverty population.

4. That long-term funding beyond the initial eight-year grant period be available to finance consultation and other preventive services not normally reimbursable from other sources. Preferential funding should also be available to support such services in poverty populations.

The National Association for Mental Health has respectfully requested that the Administration, acting in good faith and in a manner consistent with its avowed endorsement of the Community Mental Health Center system, adopt the above recommendations and enter into communication with appropriate members and committees of Congress as necessary to achieve a satisfactory settlement of divergent positions held by the legislative and executive branches of government.

In conclusion, it is our position that the CMHC legislation should be modified, taking into account the need to use federal funds to assure that "seed-money" is available to each of the 1500 catchment areas throughout the country. We believe our recommendations will achieve that end.

Dr. MILLER. Mr. Hutchinson, thank you very much for your detailed comments and your resolve.

I think perhaps in the interest of time and because there are so many waiting to testify, we will go on with the others who have testimony to present; but we will try to reserve some time perhaps to recall some of those who have already testified. I am sure there are some questions. Your presentation was extraordinarily complete.

I would like to call next Mr. Max Schneier, who is the chairman of the New York State Federation of Parents' Organizations of State Mental Institutions. Mr. Schneier.

STATEMENT OF MAX SCHNEIER, CHAIRMAN, FEDERATION OF PARENTS ORGANIZATIONS, NEW YORK STATE, AND VICE PRESIDENT, CITIZENS UNITED FOR THE HANDICAPPED

Mr. SCHNEIER. My name is Max Schneier and I am chairman of the Federation of Parents Organizations for the New York State Mental

Institutions and vice president of Citizens United for the Handicapped.

I come before you today as a representative of those people who have the greatest vested interest in the delivery of care and services to the mentally handicapped through their community mental health centers, namely, the parents and relatives of those so disabled. This hearing is an example of the American process at work-legislators listening to the people to ascertain their needs and then taking the information gathered and translating it to beneficial and corrective legislation. We parents wish to thank this subcommittee for this opportunity. Your evident interest and understanding of the problems afflicting 20 million of our citizens bodes well for the enactment of future legislation to provide the help and programs needed by this large segment of our population.

In addition to the 20-million figure mentioned, there are 9 million Americans who are problem drinkers or alcoholics and 600,000 heroin addicts.

I come here to tell this committee to take this message back to our Nation's Capital, and that message is, "No force on earth can stop an idea whose time has come." That idea, whose time has come, is the ongoing involvement and participation of the patients, parents and relatives in the planning for and the execution of the programs for care, services and rehabilitation of the mentally handicapped. The consumer of mental health services movement gathers strength with each succeeding day. We are being aided almost daily by favorable court decisions throughout the Nation. We have developed dedicated leaders who have pledged themselves and their resources to continue the struggle until our Nation reorders its priorities and places human priorities before all others.

This is no flash in the pan. We will not go away and disappear or be lulled into a false sense of security by politicians' promises, which never come to fruition. We have become knowledgeable because of our pain and suffering and the daily burdens we must carry, we are organizing so that we may gain the victory which will redound to the benefit of our handicapped fellow Americans, who today are dehumanized and debilitated in the large, custodial institutional warehouses operated by all the States, or who have not been able to find alternative community facilities such as the community mental health centers. The Congress of the United States has, by its inaction, permitted these crimes against humanity which have no parallel in our American history. The Congress has, in prior years and for the most part, left this problem to the individual States. The States, in turn, have consistently demonstrated that they cannot and will not fully meet the needs of the consumers of mental health services. Mental health is in essence, a national problem and the direction, programs and funding must mainly come from Washington, and not the State capitals.

I am sure you are well aware of the statistics and the growing need in this vital human area which costs our Nation $20 billion a year in lost productivity. You all know that every other hospital bed in this country is occupied by a mentally disabled person. I have previously referred to the large numbers of our citizens who are in need of services. You know that our elderly are particularly affected by mental

illness and that this group makes up 20 percent of the elderly living at home also suffer some mental impairment. Most of us here know that the resident population in our State mental hospitals has dropped markedly-from 558,000 in 1955 to 276,000 in 1972. It is ironic that HEW officials concede that the community mental health centers programs have contributed to this drop. We are aware of the fact that federally funded centers treated about 1 million patients in 1972 at less than one-tenth the cost per patient-care episode than in large State institutions and that these centers keep in-patients care on the average, to under 20 days, returning patients to work more quickly than State institutions.

With all of these incontrovertible facts at our disposal, why is there any question as to the need, not only of continuing these programs, but in fact to increase the number of community mental health centers from the present 493 to the 1,500 originally contemplated by the Congress. We have support of usefulness of these centers from none other than our Secretary of Health, Education, and Welfare, Caspar Weinberger, who recently wrote to the executive director of the National Council of Community Mental Health Centers as follows:

You are completely correct that I have no disagreement whatever with the value of the community mental health center program.. As one who had something to do with the start of the mental health idea in California, before there was Federal funding, I have no question as to the immense usefulness and effectiveness of the community mental health center idea.

Yet, there is an absurdity in the present administration's position in regard to the community mental health center program. On the one hand, the administration-both in the President's budget proposals last January and in testimony before congressional committees has indicated that the community mental health centers program has been highly successful.

On the other hand, the administration proposes terminating Federal support without presenting any reasonable alternative source either to support existing programs or to initiate new ones. The administration's arguments for discontinuing support are:

1. The original intention of the Community Mental Health Centers Act of 1963 was just to provide seed money to start the centers and subsequently for the Federal Government to drop out of the picture, that these centers were only demonstration projects. Our answer is that every new program was a demonstration project when it was first initiated.

2. The community mental health centers have been so successful that no new funding is necessary. The administration wants to end other major health programs, the regional medical programs for instance, because it contends they have been failures. But curiously and I say stupidly, the mental health program has lost administration favor because it has done so well.

The chairman of your subcommittee, Representative Rogers, in commenting on this absurd situation has stated the administration policy evidently is, "If it is good, do away with it. If it's bad, do away with it. In other words, wipe out all activity, and I think that that may be what is what they want to do."

Chairman Rogers further stated in his remarks on May 2, 1973, before a mental health group that: "The whole purpose of the pro