This report describes the recent efforts of Michigan's Division of Services to Crippled Children (DSCC) to assist families with handicapped children to develop their full potential for health, education, and self-support through the removal of physical, social, psychological, and economic barriers. DSCC functions are carried out at the local, regional, and state level. Major services include prevention, casefinding, diagnosis, medical care and treatment, and case management. Free diagnostic evaluation services are offered to all Michigan children with a suspected handicapping condition, and treatment services are provided for all children who are medically and financially eligible. The DSCC assists families by assuming all, or part of, the cost of related treatment for the handicapping condition. Care is provided by over 3,000 professionals of whom half are specialty-trained physicians. Locally Based Services, an endeavor introduced in 1983, provide community-based support for identifying and responding to the needs of those with chronic illness and handicapping conditions and their families. Future directions include: strengthening services delivered in the community; recognizing and supporting the significant role of families in the delivery of care; improving coordination between specialty and community care; and improving operational efficiency. (Author/CB)