National Alliance on Mental Illness
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April 14, 2003


Chairman Walsh, Representative Mollohan, and members of the Subcommittee, I am Moe Armstrong of Cambridge, Massachusetts.  I am pleased today to offer the views of the National Alliance for the Mentally Ill (NAMI) on the VA-HUD-Independent Agencies Subcommittee's FY 2004 appropriations bill.  I would like to direct my testimony to two of the important federal departments that are within the Subcommittee's jurisdiction: The Department of Housing and Urban Development (HUD) and the Department of Veterans' Affairs (VA).

In addition to serving on the NAMI Board, I am a veteran myself and I also was once homeless.  I was a medical corpsman attached to Third Reconnaissance Battalion of United States Marine Corps; I spent almost eleven months in Vietnam.  We were in combat almost every other week.  I never flinched.  I never ran under fire.  Then, one day I became mentally ill.

I spent many months on the streets of America.  I was trying to hold jobs and trying to stay in apartments.  I kept breaking down on the job.  I kept losing apartments.  I would either be on the streets sleeping in the park or staying with friends till they got tired of me.  This was 1966, nobody knew that much about mental illness or substance abuse.  There was no after care from the hospital.  I was alone to flounder and fall down. I applied to the Veterans Administration for help.  At the time, I was living in a tent in over a foot of snow when representatives from the VA came up in the mountains to see me.  They cried when they saw my condition.  I was dirty and disoriented.  I had no home.  I was just surviving on some unemployment money that I had saved and food stamps.  They got me connected with VA benefits and an agency called the New Mexico Veterans Service Commission.  The VA and the New Mexico Veterans Commission helped me.  They saved my life by bringing me out of homelessness.  They got me psychiatric care.  They got me educated and working.  Today, I help others living with mental illness-- I work in the mental health field so that I can recreate for other people the opportunities I received from mental health care. I also currently serve as a member of NAMI's Consumer Advisory Council on veterans with severe mental illness.


National Alliance for the Mentally Ill
Colonial Place Three, 2107 Wilson Blvd., Suite 300
Arlington, VA 22201-3042
703-524-7600 * FAX 703-524-9094 * NAMIhelpline * 1-800-950-NAMI [6264]

NAMI is the nation's largest national organization, 220,000 members representing persons with serious brain disorders and their families.  Through our 1,200 chapters and affiliates in all 50 states, we support education, outreach, advocacy and research on behalf of persons with serious brain disorders such as schizophrenia, manic depressive illness, major depression, severe anxiety disorders and major mental illnesses affecting children.

Through the NAMI Veterans Committee, NAMI believes that while treatment is central to recovery, it is not an end in itself.  Housing and supports provided by agencies such as HUD and the VA play a critical role in this process.  NAMI is therefore pleased to offer our views on the Administration's FY 2004 requests for these two cabinet level departments. 


The Independent Budget reports 454, 598 veterans have a service connected disability due to a mental illness.  Of great concern to NAMI are the 130,211 veterans who are service connected for psychosis—104,593 of them who were treated in the VHA in FY99 for schizophrenia, one of the most disabling brain disorders.

NAMI feels strongly that the VA must do more to maintain capacity for veterans with severe and chronic mental illness.  The lack of access to treatment and community supports for veterans with severe mental illness is the greatest unmet need of the VA.  NAMI applauds this Congress for reinforcing the capacity law through the Department of Veterans Affairs Health Care Programs Enhancement Act of 2001 (PL 107-135).  This law strengthens the VA's capacity to serve veterans with mental illness, requiring improvements to the current system to ensure that veterans have access to necessary treatment and services.  The new law not only requires the Department to maintain capacity for serving veterans with mental illness but to replace lost capacity.

The Committee on the Care of Severely Chronically Mentally Ill Veterans (SCMI Committee) reports that during FY 2002 VHA spent only 77% of the amount that it spent in FY 1996 for care of veterans with serious mental illness—a decrease of $478 million annually.  (This was based on data from the FY 2002 Report to Congress on Maintaining Capacity for Special Populations).  This reduction has occurred despite mandates that the VHA focus on its high priority veterans, including veterans with serious mental illness.

NAMI supports the FY 2004 Independent Budget recommendations for increasing the VHA's capacity to serve veterans with mental illness—including recommending that to simply achieve parity with other illnesses, the VA should be devoting an additional $478 million to mental illness spending.

Continuum of Care
VHA continues to shift its focus of serving veterans with severe and chronic mental illness from inpatient treatment to community based care.  In FY 2000, out of the 192,982 veterans who were treated for a severe mental illness, only 19.7 % received treatment in an inpatient setting.  Further, preliminary data indicates that the number of veterans treated in an impatient setting will further decline in FY 2001.  NAMI strongly supports treating veterans with severe mental illness in the community when the proper intensive community supports and treatment are available and easily accessible.  However, we are very concerned that those veterans who need inpatient care are unable to access the needed treatment because of the limited inpatient beds and the dramatic shift to outpatient treatment.

NAMI is extremely grateful for the leadership this Subcommittee has provided in holding the VHA accountable for its inability to ensure that savings derived from the closure of inpatient psychiatric beds is transferred into community-based treatment services.  From NAMI's perspective, it is obvious that this significant decrease in inpatient care has not resulted in a sufficient transfer of resources to community-based treatment and supports for veterans with severe mental illnesses.  In VISN efforts to reduce overall costs, many VISN administrators have closed long-term psychiatric beds without adequately shifting these resources into outpatient settings.  The most recent report to the VA Under Secretary for Health from the SCMI committee states that; "VHA has been alarmingly inconsistent in building and providing an adequate continuum of care for veterans who are seriously mentally ill."

NAMI remains truly concerned that meaningful community-based capacity is not being developed to treat chronically mentally ill veterans in their communities—including the VHA's lack of mental illness services available in community based outpatient clinics (CBOCs).  Many of the CBOCs were instituted in areas where VA health services were not easily accessible allowing many more veterans access to needed health care.  However, out of the VA's CBOCs that are operated, only about 40% of these facilities offer treatment services for veterans with severe mental illness.  This is a disturbing statistic given that 20% of VA outpatient visits were for mental health purposes.

NAMI would again urge the Subcommittee to go further in FY 2004 and specifically direct the VHA to require that all savings from cuts in inpatient psychiatric beds be reinvested in intensive case management services and in providing mental illness treatment in community based outpatient clinics that serve veterans with severe mental illnesses.  Moreover, NAMI recommends that when reporting to Congress on capacity, VA provide data on dollars spent for care, as adjusted for inflation since 1996, to ensure accurate reporting of the Departments ability to deliver and maintain mental health capacity for veterans.

Mental Health Intensive Case Management
As members of this Subcommittee know, the VHA issued a directive in October 2000 for Mental Health Intensive Case Management (MHICM).  MHICM is based on the Substance Abuse and Mental Health Services Administration's (SAMHSA) standards for assertive community treatment (ACT), which NAMI believes are proven, evidence-based approaches for treating individuals with the most severe and persistent mental illnesses.  FY 1998 Compensation and Pension data show that almost 40,000 veterans with severe mental illness are in need of intensive community case management services.  Further VHA data shows that assertive community treatment is cost-effective as well as effective in treating severe mental illness.  However, a FY 1998 survey by the Committee on Care of Severely Chronically Mentally Ill (SCMI) Veterans showed that just over 8,000 veterans are currently receiving some form of intensive case management, and that only 2,000 veterans were in treatment programs that met the SAMHSA standards.  The SCMI committee has also reported that intensive case management teams are operating at minimal staffing and some are facing further staff reductions. 

NAMI strongly recommends that Congress appropriate the funds necessary to provide the essential number of new intensive case management teams and to fully staff existing teams so that our nation's most vulnerable veterans receive appropriate and coordinated care.

Access to Appropriate Medications
NAMI is extremely grateful to this Subcommittee and the bipartisan coalition of members of Congress that pushed hard to hold the VA accountable in its implementation of its schizophrenia treatment guidelines to ensure that veterans with severe mental illnesses get access to the newest and most effective medications.  In NAMI's view, these protections are a substantial step forward for veterans with severe mental illness and their families.

NAMI would urge the Subcommittee to continue to monitor the implementation of these treatment guidelines, the use of restrictive drug formularies by VISNs that cover psychotropic medications, as well as VISN compliance with the congressional directive issued in 2001.  NAMI feels strongly that veterans with mental illness deserve full access to the newest and most effective medications.

Homeless Veterans
NAMI applauds the Subcommittee's efforts to expand services for homeless veterans.  As you know, severe mental illness and co-occurring substance abuse problems contribute significantly to homelessness among veterans.  Studies have shown that nearly one-third (approximately 250,000) of homeless individuals have served in our country's armed services.  Moreover, approximately 43% of homeless veterans have a diagnosis of severe and persistent mental illness, and 69% have a substance abuse disorder.  NAMI appreciates the provisions contained in PL 107-95, The Heather French Henry Homeless Veterans Assistance Act, passed by Congress last year.  Particularly, NAMI supports fully funding authorized grant programs for homeless veterans with severe and chronic mental illness.

NAMI is pleased that the Subcommittee continues to support initiatives at the VA to support residential options for homeless veterans with mental illness through the Homeless Providers Grant and Per Diem Program and the new Loan Guarantee for Multifamily Transitional Housing for Homeless Veterans Program.  NAMI would urge that these initiatives be expanded to offer clinical outreach, case management and support services in communities with high concentrations of homeless mentally ill veterans.

Even though the VA has made genuine progress in recent years in funding for psychiatric research, such research remains disproportionate to the utilization of mental illness treatment services by veterans.  Veterans with mental illness account for approximately 25% of all veterans receiving treatment within the VA system.  Despite this fact, VA resources devoted to research has lagged far behind those dedicated to other disorders.

For FY 2004, NAMI urges the Subcommittee to support the recommendation of the Independent Budget and Friends of VA Medical Care and Health Research to increase the overall VA research budget by $63 million over the FY 2003 appropriation.  Psychiatric research dedicated to chronic mental illness, substance abuse and PTSD has remained relatively flat for last 15 years, despite the fact that the number of patients in the VA system receiving mental illness treatment has grown.  Research is one of the VA's top missions and NAMI is pleased that the VHA is taking steps to increase the number of Mental Illness Research, Education and Clinical Center (MIRECCs), centers designed to serve as infrastructure support for mental illness research.  Because medical research is so important to improved treatments for severe mental illnesses and ultimately the cure of these disabling brain disorders, NAMI recommends full funding of the MIRECCs.  NAMI has been disappointed that although funding for two new MIRECCs has been budgeted, the VA has yet to approve the establishment of these two new centers.  These centers have provided valuable research on improving the service delivery for mental illness treatment and would strongly encourage the Department support the establishment of two additional MIRECCs as well as issue a request for proposal for additional future MIRECCs.


Mr. Chairman, I would now like to offer NAMI's views on the Bush Administration's FY 2004 request for HUD.  As you know, housing is the cornerstone of recovery from mental illness and a life of greater independence and dignity.  In my work over the years in peer counseling and training consumers to work in the peer counseling field, I have witnessed first-hand the central role that decent, safe and affordable housing plays in promoting recovery, access to treatment and a stable life in the community.  NAMI believes that no single program or model can meet the needs of every individual living with severe mental illness.  NAMI feels strongly that range of options are needed for consumers based on their own circumstances – from supported housing to congregate living to tenant-based vouchers to homeownership – a range of options supported through HUD's programs are needed.

Section 811 
For the Section 811 program the Administration is requesting $251 million -- $8 million less than Congress appropriated for FY 2003.  The Bush Administration's budget also proposes to maintain the current structure of the Section 811 program, with 75% of funds going toward capital advances and project-based assistance to non-profit groups to build and manage housing for people with disabilities (including non-elderly adults with severe mental illnesses).  The other 25% of the program would continue going toward tenant-based rental assistance, also known as the Section 811 "mainstream" program.

In FY 2004, for both the capital advance/project-based side of the Section 811 program and for the tenant-based mainstream side, Congress and HUD face a continued challenge to fund renewal of expiring rent subsidies.  In both cases, these ongoing obligations to renew funding associated with units already in existence are expected to drain limited resources.  For the capital advance/project-based side, HUD estimates that $8 million will be needed to renew expiring project-based rent subsidies (also known as PRACs) -- $2 million more than was needed in FY 2003.  On the tenant-based "mainstream" side, HUD projects that $42 million will be needed in FY 2004 to renew expiring tenant-based rent subsidies that were originally funded in prior years ($10 million more than was needed in FY 2003).  The result is that the Administration's proposed $8 million cut for Section 811 is, in reality, at least a $20 million cut when measured in terms of the capacity of 811 to produce new units (both project-based and tenant-based), i.e. the $8 million proposed reduction, added on to the $12 million renewal burden for existing units.    

NAMI has joined with our colleague national disability organizations in seeking support in Congress for a $310 million appropriation for HUD Section 811 (supportive housing for people with disabilities) program for FY 2004. This $50 million increase is needed in order to keep pace with the growing burden associated with one-year renewals of project-based and tenant-based rent subsidies under the program – as noted above, $8 million for project-based renewals (also known as PRACs) and $42 million for tenant-based renewals.  Without an increase to cover renewal of PRACs and 811 tenant-based "mainstream" subsidies, funding for new units developed under the program will be cut. 

NAMI would note that there is ample precedent in the HUD budget in recent years for adding funds to the HUD budget to cover growing rent subsidy renewal costs.  Since FY 2000, this Subcommittee has created and funded a separate account at HUD for renewal of expiring rent subsidies under the Shelter Plus Care program (part of the McKinney-Vento Homeless Assistance Act).  This Shelter Plus Care renewal account has been funded over the past three years WITHOUT a reduction in the base of the McKinney-Vento program.  NAMI and our colleagues in the disability community are seeking the same treatment for Section 811 renewals in FY 2004. 

Disability Vouchers
The Administration's budget proposes to continue separate funding of $36 million for Section 8 vouchers for non-elderly people with disabilities adversely affected by designation of public and assisted housing as "elderly only" – so-called "Frelinghuysen" vouchers.  This proposal is being put forward even though the Bush Administration is not requesting any additional funds in FY 2004 for new Section 8 ("incremental") vouchers.  As you know, Congress has funded this allocation of tenant-based vouchers since 1996 in response to the erosion of affordable housing resources for non-elderly people with disabilities that has occurred as a result of the growth of "elderly only" housing.  NAMI strongly supports this request and would like to recognize the tremendous leadership of your colleague Representative Rodney Frelinghuysen – a former member of this Subcommittee – in making these resources available to people with disabilities. 

McKinney-Vento Homeless Assistance Act
For homeless programs, the President's budget is proposing $1.526 billion for FY 2004 for programs under the McKinney-Vento Homeless Assistance Program.  The Administration's budget also includes a new plan to end chronic homelessness within 10 years – the "Samaritan Initiative."  For FY 2004, the President is proposing $50 million in new HUD funding for the Samaritan Initiative and $10 each for HHS and the VA.  NAMI strongly supports the Samaritan Initiative and the Administration's continued support for shifting the emphasis of federal homeless policy toward addressing the needs of individuals disabilities and chronic health needs that stay homeless for years at a time.  NAMI would also like to recognize the efforts of the White House Interagency Council on the Homeless in bringing forward a new plan to make agencies such as HHS, Labor and VA more accountable in providing services to individuals experiencing chronic homelessness in order to free up limited HUD funds for permanent supportive housing.   Surveys indicate that as many as 200,000 persons experience chronic (as opposed to short-term or episodic) homelessness.  Numerous studies have made clear that individuals with severe mental illness and co-occurring substance abuse disorders are disproportionately represented among this chronic homeless population.

For the past fours years, NAMI has been an enthusiastic supporter of efforts in this Subcommittee to ensure that HUD directs at least 30% of McKinney-Vento Act funds for permanent housing and that communities come up with a 25% match for services.  This permanent housing set aside, and the local services match, have been important factors in persuading states and localities to invest their federal homeless funds in permanent supportive housing through programs such as Shelter Plus Care.

It is expected that as much as $194 million will be needed in FY 2004 to renew all expiring rent subsidies under the Shelter Plus Care program.  NAMI commends President Bush for supporting in his budget continuing a separate allocation of additional funds to cover the cost of renewing all expiring Shelter Plus Care rent subsidies in FY 2004.  Without these funds, many communities will not be able to keep their Shelter Plus Care housing operating, or will not be able to fund new permanent supportive housing, thereby preventing further progress in ending chronic homelessness.  NAMI therefore strongly urges the Subcommittee to ensure that there are sufficient funds to renew all expiring Shelter Plus Care and SHP permanent housing renewals for the FY 2004 competition for the McKinney-Vento program. 

Thank you, Chairman Walsh, for allowing me to share the views of the National Alliance for the Mentally Ill on the VA-HUD-Independent Agencies Subcommittee's FY 2004 appropriations bill.