A picture of former HEW investigator John J. Walsh was incorrectly identified in Thursday's Washington Post as Hale Champion, the under secretary-designate at HEW.

The Senate Finance Committee yesterday approved Hale Champion's nomination as under secretary of health, education and welfare, an appointment held up for a week in a dispute over whether HEW officials had delayed on investigation of a California home health care fraud case.

Champion's nomination had been put off by Sen. Herman E. Talmadge (D-Ga.), a committee member who contended there were contradictions between Champion's testimony and a version supplied by HEW's former chief investigator, John J. Walsh.

Walsh said in an affidavit last week he quit HEW after Secretary Joseph A. Califano Jr. ordered him to clear all investigations, including the California inquiry, with the department's general counsel.

Summoned to testify yesterday, Califano said Walsh had misunderstood his instructions during a Feb. 4 meeting at which the investigation of a Medicare-Medicaid fraud case involving a California businesswoman discussed.

Califano said he had not intended to delay that investigation. Walsh had said he stopped the investigation temporarily after Califano ordered the general counsel to develop a new plan for carrying it out.

Califano said it was "utter nonsense" to contend he had tried to block the investigator's case. "I think Mr. Walsh misunderstood what I was saying that morning," he said.

Walsh agreed the dispute may have been "an honest difference of opinion" with Califano and said he had not intended to accuse him of "any improprieties."

Several members agreed it was all a misunderstanding. "I don't know what the shooting is all about," said Sen. Abraham A. Rubueoff (T-Conn.)

In his affidavit, Walsh had said Califano told him that all investigations had to be clear through the general counsel's office and that he did not want HEW personnel "investigating a bunch of innocent people."

Since the comments were made during a conversation about the California case, Walsh said he interpreted them to mean he should call off that inquiry and abide by Califano's instruction to let the general counsel prepare a plan for the investigation.

Califano said yesterday he had called in Walsh in order to be sure the California inquiry was proceeding. But he said as a general policy he believes the general counsel should be involved in all such investigations to protect subjects' civil right's and to see the inquiries have a sound factual base for prosecution.

Walsh said he believes that in departments where investigations are controlled by general counsels "nothing ever happens." Califano had said be only wanted his general counsel to be "informed" of the investigations.

Talmadge, in a statement, said that HEW's action in the Califano case went beyond merely having the general counsel "informed." He noted that a representative of that office was dispatched to Califano to look into the case during the period when Walsh had suspended his own staff's investigation.

"I felt that the Secretary had decided that the general counsel should decide how the investigation was to be done," Walsh said, when questioned about why he temporarily halted his investigation.

Sen. Lloyd M. Bentsen Jr. (D-Tex.) said he saw nothing in the testimony to indicate that Califano had intentionally tried to impede the California investigation.