By C. Everett Koop, M.D., Surgeon General and Deputy Assistant Secretary for Health
Presented to the 62nd Interagency Institute for Federal Health Care Executives
St. Louis, Missouri
March 18, 1983
(Greetings to hosts, guests)
It's a pleasure to be here, representing the U.S. Public Health Service at this Interagency Institute. Let me first say
that one of the most satisfying aspects of my position has been the opportunity to work side-by-side with the Surgeons General
of the Armed Forces and their staffs. Last year, for example, it was my turn to assume the Presidency of the Association of
Military Surgeons the United States -- AMSUS, for short. During that time, I received 100 percent support and cooperation
from my colleagues in all the uniformed health services. It was an exciting and very useful year and we accomplished a number
of things of which I - the Commissioned Corps of the Public Health Service -- are quite proud.
This year, we are all privileged to give our full support to the current president of AMSUS, Major General Bernard Mittemayer,
Surgeon General of the Army and a good friend of the Public Health Service, I might add.
This morning, in the few minutes I have at the microphone, I want to give you an overview of the organization and mission
of the Public Health Service and then make some educated guesses as to what the PHS might look like in the next five or ten
I know you've been absorbing vast amounts of information since March 7, so I will try to be as brief as I can.
First, you should know that the Public Health Service is far from being a monolith. It is made up of five PHS agencies, plus
the office of the Assistant Secretary for Health. That position has line authority over the Public Health Service and has
been playing an increasingly significant role in areas of both policy and program. In urgent matters of public health, Surgeon
General is the principal communicator. I am also the highest ranking member of the uniformed PHS Commissioned Corps, which
is 5,800 strong.
Now, what about those agencies.
Taking them in alphabetical order, I'll start with the Alcohol, Drug Abuse, and Mental Health Administration. I think
the title says it all. This agency has three national institutes -- of Mental Health, of Drug Abuse, and of Alcoholism and
Alcohol Abuse. They carry out research and public education programs and, until recently, they've also supported a wide
range of service delivery programs at the local level . . . 800 mental health centers . . . 300 state and local drug abuse
programs . . . and about 1,000 local alcoholism projects. But more about those projects later.
The fiscal 1983 appropriation for ADAMHA, as it is known in the trade, is $420 million dollars.
Next, the Centers for Disease Control, or CDC. The centers are headquartered in Atlanta and, as the name implies, they are
concerned primarily with controlling or preventing communicable and vector-borne diseases. You have probably read CDC's
Mortality and Morbidity Weekly Report, the barometer of infectious disease activity in this country.
CDC's history is rooted in that strong tropical disease fraternity who labored with William Crawford Gorgas and Walter
Reed and the Caribbean, Central America, and the Philippines. Today, the centers work primarily through state and local health
authorities to carry out such activities as child immunizations, the control of sexually transmitted diseases, and epidemiological
detective work to unravel the mysteries of Legionnaire's disease, Toxic Shock Syndrome, and the latest strain of influenza.
Right now, as you have probably read in the papers, the CDC are trying to solve the mystery of AIDS, or acquired immune-deficiency
CDC personnel are not only on TDY with state health agencies, but they're also on duty overseas screening Southeast Asian
refugees or helping the world health organization plan its "Extended Child Immunization Programme." The Public Health
Service is involved to some extent in technical assistance agreements for improving the health care in 38 other nations. The
Centers for Disease Control contribute personnel and expertise to most of these.
CDC budget for fiscal '83 is $248 million.
The Food and Drug Administration -- or FDA -- has been, for most of its 77 years, one of the most widely publicized, praised,
and vilified agencies of government. The two watchwords of its law, safety and effectiveness, place the FDA as the arbiter
for public health in the marketplace of drugs, vaccines, medical devices, health supplies, radiological gear, and certain
health and medical practices, such as nutrition and diet counseling, prescription drug advertising, drug prescribing, and
antenatal fetal diagnosis.
The FDA's budget for fiscal '83 is $367 million -- not an extraordinary sum, considering that the mission of the FDA
is to regulate about $465 billion worth of American commerce, a little more than 100 times the FDA's budget.
The Health Resources and Services Administration is concerned with a variety of programs:
First, in sheer size and impact, the major HRSA program is the Maternal and Child Health Program -- running at a level of
$373 million this fiscal year -- plus such related programs as family planning, genetic counseling, the prevention of Sudden
Infant Death Syndrome.
Next would be the education and training of health professionals: physicians, dentists, nurses, therapists, technicians, and
many others. Again, we are challenged by success. Most estimates by private and government organizations show current or potential
"surpluses" among certain professions. You are probably most familiar with the major component of this program, the
National Health Services Corps, which assigns 2,500 health personnel mostly physicians, nurses, and dentists to deliver medical
care in underserved areas. This is how these young professionals repay their student loans to the government.
A third major program is the building and maintenance of American medicine's domestic, civilian physical plant. This is
known as the Hill-Burton program, named for its congressional sponsors in 1946. It's been a very successful program --
so much so that there now appears to be about 100,000 surplus hospital beds, a costly circumstance for the nation.
This organization has also been responsible for supporting health planning at the state and local levels. A relatively new
program, health planning has come to be the example many observers choose when arguing the cause of relief from federal regulations
and a return to the primacy of state government.
The Health Resources and Services Administration the PHS agency that has actually delivered -- directly or through third parties
-- a variety of health services to "protected populations." Some examples are American Indians and Alaska natives,
migrant workers, federal employees, coal minors, and people living in medically underserved or unserved areas.
Until recently merchant seamen, bargemen, canallers, riverboaters, and federal retirees were also included; they received
their care through eight public health service hospitals and 27 clinics -- all that remained of the once extensive network
of "Marine Hospitals" begun by President John Adams in 1798. As you may know, PHS no longer operates those clinics
The Health Resources and Services Administration has the fiscal '83 appropriation of $1.2 billion.
The agency with the largest appropriation is the National Institutes of Health. It's budget for fiscal 1983 is $4 billion.
The 11 institutes that make up the NIH support about 16,000 extramural research projects at any one time. NIH also carries
out some 2,000 intramural projects each year. Since 1937, when the National Cancer Institute was established, the NIH has
supported the work of 60 Nobel laureates in medicine, physics, and chemistry, or about 1 out of 6 winners in those price categories.
The final major organizational unit within PHS is the office of the Assistant Secretary for Health, the ranking civilian health
officer in our government. Within this office are such activities as disease prevention and health promotion, anti-smoking,
support for HMO's, adolescent pregnancy programs, international health, physical fitness and sports medicine, and staff
activities such as planning, evaluation, management and budget, personnel, and so on.
The OASH budget this year is $1.5 billion. But over 80 percent of that is the funding of four block grants. And that leads
us to some comments about the future.
The PHS organization I just described was what we had during fiscal 1983. As you know, President Reagan proposed -- and Congress
approved -- the notion of grouping the many similar categorical grant-in-aid programs into a series of block grants to the
states: one for preventive services, another for the ADAMHA projects, and a third for maternal and child health. Congress
authorized and funded these three as of August 1981.
A fourth block grant is concerned with the community health centers program. Our department and the Congress have been working
at resolving certain differences concerning this grant. Congress attached to the jobs bill its final version of the fourth
The block grants -- and the philosophy of government behind them -- are changing the configuration of the PHS. The growth
of the PHS during the past 15 to 20 years has been primarily the result of new and expanding categorical grant programs. At
the time Pres. Reagan was inaugurated, January 1981, the executive branch was funding and operating 534 categorical grant-in-aid
programs. One seventh of those -- 74, to be exact -- were in PHS.
The administration said that it was time for the federal government to get out of the business of managing the delivery of
health services, either directly or by proxy through grantees and contractors. It has been too costly, too unwieldy, and not
as effective as advertised. Handing over those federal programs to state and territorial health authorities seem to be preferable.
Bundling them into blocks, with as few strings as possible, was to be the method.
And PHS has had enough experience with this notion to make us optimistic. For example, nearly all of CDC's service programs
are administered through states. That relationship involves immunization, fluoridation, data collection, rat control, and
similar programs. The record there is very impressive.
Another example is Indian Health Service. Under the "Indian Self-Determination Act," P.L. 93-638, federally recognized
tribes can decide how much federal aid they want under their own control. A number of tribes chosen to assume complete control
over health services formerly managed and delivered by the Indian Health Service. And that also seems to work.
The result of the block grant approach is a new division of labor within PHS. One task is simply to administer the fiscal
arrangements for the blocks. That can be done with a relatively small staff at the Assistant Secretary's level. The other
task is to provide the states with any technical assistance they might need or in other ways be helpful to state program people
at their request. This task requires fewer federal personnel in smaller PHS agencies.
The president hopes that the block grant approach, in addition to breathing new life into American federalism, will also tend
to reduce the growth rate of federal health funding. This has been one of the fastest-growing line items in the federal budget.
In 1965, a benchmark legislative year, federal spending for health totaled $5 billion. That would include the VA and the National
Science Foundation, as well as the PHS. By 1980 the total had risen to $71 billion -- a 14-fold increase. Obviously, if the
president is looking for so-called "targets of opportunity" for cooling down the federal budget, what better place
to start than the public health budget.
But even that is an oversimplification. While some health agencies may endure lowered appropriations, some public health functions
will require -- and receive -- more money. This is seen most clearly in the research area.
The NIH research budget for fiscal 1983 is $337 million higher than the previous year's budget, or about $3.7 billion
of the NIH total $4 billion for this year. The same is true for ADAMHA while that agency has actually had a decline in its
overall budget -- largely due to the loss of the services programs and certain training programs -- there's been a net
increase of $27.3 million this year over last for the predominantly behavioral research supported by ADAMHA.
Now, armed with all this information, you may begin to see what the world of PHS may look like over the next five years. Let
me sketch the outline for you now:
1. We will be returning to what had been our traditional role as a partner . . . an equal among equals . . . with colleagues
in health and medical care at other levels of government and in private nonprofit and for-profit organizations. More initiatives
for improved health and medical care will originate among those groups than may have been the case in the recent past. The
opportunities will be there, since the federal role as principal source of funds is being reduced, brought back down to a
more reasonable scale. Federal expertise will reside more in substance, in the ability to negotiate among competing interests
on the public's behalf, and in the stewardship of the national health agenda.
2. Aside from the "housekeeping role" of fiscal management of the blocks, the PHS retains -- and is expected to strengthen
-- its role as principal supporter of basic biomedical and behavioral research. Only the federal government can assemble the
extraordinary resources of personnel, money, facilities, and time and invest them over the long term in such projects is unlocking
the genetic code, identifying the fundamental mechanisms of human immunology, developing monoclonal hybridoma technology,
and, of course, the research required to beat the major killers in society: heart disease, cancer, and stroke.
3. The great structure built to carry out the delivery of health services was predicated on medical practice that was essentially
curative and reparative. It was also largely post-facto medicine. One of the things we've learned from research and experience,
however, is that the most effective tool we have two improve health status is prevention, combined with health promotion.
There would never have been enough money in the world to take care of heart disease and cancer victims -- if there had been
no campaign to get people to quit smoking. We would never have been able to care for the children and adults struck down by
polio, diphtheria, measles, and typhus, had there been no program of mass immunization.
The logic of this is so overwhelming that the prevention of disease and disability and the promotion of good health and well-being
are now the keystones of national health policy. One of the most exciting developments in the years ahead, therefore, will
be the maturing of this concept as fundamental to American public health policy and practice. Contributing to this process
will be an important function for the federal health enterprise, whether from its research or its public education programs.
I hope this brief overview of where we are and where we seem to be moving has helped you get some perspective and the US Public
Health Service. We've come a very long way over the past 185 years. We anticipate a fruitful journey for the next 185.