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Testimony on FY 97 Labor/HHS/Education Appropriations by Nelba Chavez, Ph.D.
Substance Abuse and Mental Health Services Administration
U.S. Department of Health and Human Services

Before the House Appropriations Labor, Health and Human Services, And
May 2, 1996

Mr. Chairman and Members of the Subcommittee, thank you for the opportunity
to present the 1997 budget request for the Substance Abuse and Mental Health
Services Administration.

Our request is based on a number of considerations. First is the evolving
role and responsibilities of the Federal Government. The Federal relationship
with the States is changing. Through waivers and new program designs there is a
movement toward increased flexibility and increased focus on results. As you
know, Americans across the nation are asking their government officials to prove
to them that what government does has value and that government programs are
efficiently and effectively run.

Our second consideration is the current trends in the health care delivery
system. As employers continue to look for ways to cut costs, stay competitive
and provide optimum health care, they have turned increasingly to managed care
as an immediate solution. So have governments at all levels. An estimated 120
million Americans now have managed care coverage for mental health and substance
abuse services, an increase of more than 30 percent in less than two years. As
we are quickly finding out, the Nation has little knowledge about the impact of
managed care on use, quality, cost, access, and outcomes measures for substance
abuse prevention and treatment and mental health services.

And third, we must consider the latest information available from our
leading national health indicators. The most recent National Household Survey
on Drug Abuse reported that marijuana use among 12-17 year olds nearly doubled
from 1992-1994, though it remains far below the peak reached in 1979. At the
same time, we are witnessing a decline in the percentage of youths 12-17 years
old who believe there is great risk or harm in using marijuana and cocaine. In
addition, our Drug Abuse Warning Network has identified that methamphetamine-
related emergency room episodes increased by 256 percent from 1991 to 1994.

The National Comorbidity Survey estimated that 7.6 to 9.9 million Americans
suffered from co-occurring addictive and mental disorders in a given year.
Eighty-nine percent of those individuals were first diagnosed with a mental
disorder, with the vast majority of onsets in the adolescent years. The median
difference between the age of onset of the mental disorders and subsequent
addictive disorders is 5-10 years. This gap provides a "window of opportunity"
to introduce a targeted substance abuse prevention program along with needed
mental health services.

Yet, two-thirds of young people in this country who have a mental disorder
are not getting the help they need. When problems become apparent, the stigma
attached to mental disorders is so strong that isolation and discrimination are
too often the only response a child receives. Without help, these problems can
lead to school failure, alcohol and other drug use, family discord and even

Clearly, there is a need for continuous Federal leadership in these and
other substance abuse prevention and treatment and mental health service areas.
As a long-term partner with States and counties, communities and employers,
consumers and families, health professionals, SAMHSA is well positioned to meet
these challenges-and continue to push the field forward.

Overall, the President has proposed a $2.1 billion budget for SAMHSA for FY
1997. This is an increase of $243.6 million or 13.1 percent over the FY 1996
policy level and represents an increase of 214.3 million over the recently
enacted 1996 appropriation.

To ensure that the maximum amount of our resources is available for programs
and that we are not spending any more than necessary on administrative
functions, SAMHSA is currently implementing a comprehensive set of
organizational changes. Specifically, the agency is consolidating
administrative operations and reinvesting the savings into frontline program

At the same time, we are continuing to move in a new direction with the
discretionary grant program. over the years, these Congressionally authorized
categorical service programs have been extremely valuable.

They have resulted in a national infrastructure for substance abuse
prevention, strengthened the science of prevention and highlighted areas that
need further intense study.

We have also demonstrated that SAMHSA supported addiction treatment programs
for women raised standards of care and reported results:

- 95% reported uncomplicated drug-free births.

- 75% of those who successfully completed treatment remain drug free.

- 46% obtained employment following treatment.

- 40% eliminated or reduced their dependence on welfare.

- 65% of their children were returned from foster care.

- 84% of children who participated in treatment with their mothers improved
their school performance.

The State of California has shown that for each dollar spent of drug
treatment, the taxpayer saves seven dollars by reducing criminal justice, health
care, and welfare costs.

Furthermore, we have transformed the state of the art in mental health care
from custodial, confinement in remote institutions to one of active care within
local communities. We have shown that treatment for mental disorders can help
return people to work, get people who are homeless and mentally ill off the
streets, and return children with serious emotional disturbances from
out-of-state hospitals to their homes with their parents.

However, given the changing role and responsibilities of the Federal
Government and budget realities, we have undertaken a review of all current
demonstration programs, and where necessary, individual projects, to determine
which ones to continue. Projects continued into 1997 as noncompeting awards
will represent activities best positioned to provide relevant, timely and useful
information which meets national needs.

In addition to continuation projects, our budget proposes an increase of
$164.5 million for new grants for the new knowledge development and application
program. This request is based on the current trends in the health care
delivery system and in public health. It also reflects needs outlined by our
partners. They have told us they need new and better information on: how
managed care financing mechanisms affect people with or at risk for addiction or
mental disorders; how prevention can reduce managed care costs; how early
childhood problems can be identified and addressed in a family context to avoid
serious and costly future addiction and mental disorders; how to curtail the
emerging marijuana problems among youth and the resurgence of methamphetamine
abuse in many sections of the country; and how to involve consumers of mental
health services in the treatment of others with mental disorders.

Consistent with the need to ensure that new knowledge is actually applied in
ways that improve services and save money, we plan to devote almost half of new
knowledge development and application funds to changing systems and treatment
practices throughout the country. However, it is important to note, we will
continue to get input from our partners before the 1997 knowledge development
and application agenda is considered final.

One on-going means available for implementing the findings from the
knowledge development and application program is SAMHSA's block grant programs.
Our 1997 request again proposes to replace the Community Mental Health services
and Substance Abuse Prevention and Treatment Block Grants with Performance
Partnership Grants.

As proposed in the pending Senate SAMHSA reauthorization legislation
(S.1180), Performance Partnership Grants would increase the State's flexibility,
allowing them to set their own priorities for expenditures and management of
grant funds. In exchange states will accept greater accountability for
producing results. over the past year, we have continued to establish the basis
for outcomes oriented, Federal-State partnerships. The preliminary discussions
are encouraging.

The 1997 budget request includes an additional $67 million for the Substance
Abuse Performance Partnership Grant and an $11 million increase for the Mental
Health Performance Partnership Grant. These increases are needed to respond
to the recent rise in substance abuse among youth, the number of AIDS cases
associate with injecting drug use, and the continued gap between the number of
people with mental and or addictive disorders in need of treatment and the
number of those people who receive treatment.

While the Knowledge Development and Application and Performance Partnership
Grants remain the largest and most visible of SAMHSA's current efforts, other
SAMHSA activities continue to be critical in improving quality and availability
of services. These include: collecting and analyzing data; developing
comprehensive community mental health services for children and adolescents;
developing the first ever "Report Card" generated by and for consumers of mental
health services to gauge accessibility and quality of mental health services
provided through managed care plans; and investigating incidents of abuse and
neglect of individuals with mental illness.

In addition, we are very interested in intensifying SAMHSA's current efforts
with employers, labor and other Federal agencies to improve the availability and
quality of mental health services and substance abuse prevention and treatment
programs provided through the workplace. The workplace provides us a direct
channel to reach-out to a large segment of the population. In addition, most
Americans access their health care through their employers. Business and labor
can ensure that substance abuse prevention and treatment and mental health
services remain options for their employees and families. As a result, the
Nation will have healthier, safer, and more productive workforce in the future.

Mr. Chairman, we are not here today presenting the same old way of doing
business. We are moving through a paradigm shift to ensure that our efforts
have greater impact and to demonstrate accountability for the Federal dollars
entrusted to us by the Congress and the Administration. Over the years, our
work and the taxpayers' investment in SAMHSA have shown that substance abuse
prevention, addiction treatment and mental health services work. Yet, just like
interventions for heart disease, cancer, and diabetes, these services can be
improved and we need to continue to build on our past successes.

We also know that investing Federal resources in these areas make sense. It
improves lives, strengthens families, saves children, and increases
productivity. At the same time it saves dollars across a broad spectrum of
other federal government programs, including housing, education, welfare,
Medicaid, labor and criminal justice.

Finally, continuous Federal leadership is needed. In the area of substance
abuse, we welcome the leadership of General Barry McCaffrey. SAMHSA's staff has
worked with his office to develop the 1996 Drug Control Strategy, and our
programs are fully engaged in supporting its mission, "to eliminate drug use and
its consequences."

As we work together, the Administration and the Congress, it is clear that
each new generation of American youth presents us with new challenges. Each new
scientific advance in substance abuse prevention, addiction treatment and mental
health services provides new options. And these options need to be translated
to every day, teal-life practices in order to improve the quality and
availability of substance abuse prevention and treatment and mental health
services to those most in need. In short, that is SAMHSA's mission and that is
what the American people receive for their investment.

Again, Mr. Chairman and Members of the Subcommittee, thank you for the
opportunity to present the 1997 budget request for the Substance Abuse and
Mental Health Services Administration. .We will be pleased to answer any
questions you may have.

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