(including principal and interest). The payments averaged $400 a month and have served mostly to keep up with or reduce accumulated interest. At this level of payment, he will not be able to repay his debt within the prescribed period. The debtor purchased several pieces of real estate (total purchase value was $318,000) in September 1978, January 1979, August 1979, February 1981, and May 1981. In addition, a $14,000 Cadillac The Debt Collection Act of 1982, an act that I know you are quite familar with, will give authority to agency heads to collect clains by administrative offset. The Department's regulations which implement the Act, are in process of being developed. We will reinforce our earlier recommendations that the regulations make provision for administrative offset of We delinquent debts against Medicare and Medicaid payments. believe that this represents a significant method of correcting a bad situation. Before concluding my testimony, I would like to take this opportunity to make other loan collection observations. We have worked with you on these programs and know of your on-going. interest in them. In the Health Professions Student Loan (HPSL) and Nursing Student Loan (NSL) programs, PHS has initiated steps to correct many problems cited by our earlier audit work. regulations have been issued, legislation has been proposed, and New PAS has increased its monitorship of the program, all designed However, our current audit work shows that as one problem is 79, being controlled, another is developing. The Health Education lla: Assistance Loan (HEAL) Program guarantees loans made mainly by may borrow up to $20,000 a year. All principal and interest are are guaranteed by the Federal Government. Because of the deficiencies noted in our earlier review of HPSL and NSL, we initiated, in coordination with PHS, a review We advised PHS of these conditions and they are moving to correct the problems. Our recommendations are that PHS should require a needs test and should limit loans to tuition, fees and reasonable living expenses. We expect to issue shortly a draft report to PHS which will discuss these and other problems together with our NHSC Delinquents By State Senator PERCY. We have two witnesses that will appear as a pan and then be followed by the U.S. attorney from the Northern Distri of Illinois, Mr. Dan Webb. First we will have Dr. Edwin Martin, I rector of the Bureau of Health Care Delivery and Assistance of t Department of Health and Human Services, and Mr. William Tys Director of the Executive Office for U.S. Attorneys. TESTIMONY OF EDWIN D. MARTIN, M.D., DIRECTOR, BUREAU HEALTH CARE DELIVERY AND ASSISTANCE, DEPARTMENT Senator PERCY. Dr. Martin, I would like to indicate that this committee has never had more cooperation from a Federal agency t we have had from HHS. I particularly would like to thank Joe Bro Joan Schuster, and Jim Corrigan of your staff for their help. Th you very much. I wonder if you could first respond to Dr. Eshelm characterization that the program is unfairly administered. Dr. MARTIN. I have substantial disagreement with Dr. Esheli We are the ones that are sending the default letters. There are fundamental differences of fact between his testimony and the p and the demonstrable record which I think are critical for the mittee to take cognizance of. First of all, we need to see the N] program in perspective. This goes to the heart of why this issue such great concern to us as well as to the Congress, we have 2,765 ple that are on duty now. We have had 3,169 that have completed obligations. We are talking about individuals who are providing h service in underserved areas throughout the country, in North South Dakota, in rural Mississippi, in the rural Southeast, in the cities in South Bronx and in Cook County, as you mentioned." people are to some degree inconvenienced and in different cir stances by definition. They are serving millions of people, and the gram has served millions of people in the past. This is the National Health Service Corps. I want to make a di: tion between the National Health Service Corps and the problem tors we are talking about today. To us, the people actually servi this activity are the people that make that program proud. Second, Dr. Eshleman, one of the defaulters, said that we recr them to apply. In the years that both of the doctors applied, less 50 percent of the applicants actually got the scholarships. It we ceedingly competitive, and indeed, the reason they were choser because of the kind of statements that they made regarding cor ments to serve in rural areas, in rural Mississippi, in rural N Carolina. They said they were interested in doing that, and thai, would be a lifelong social and personal commitment. We took them at face value, and we picked them over other p because of those statements. In regards to the specifics of Dr. Eshleman's allegations of cha in administrative policy, the basic policy of the Corps of whic the way, I directed in 1974–76 after running a health center is South Bronx and have been either running the National Health Se |