the social laws are trying more and more to force this compartmentation, the medical findings do not substantiate this and they indicate that the greatest good to the most people would come from a flexible arrangement based on true need, regardless of age. This has been the basis of our operation in Virginia for the past 10 or 15 years. I do not wish to convey the impression that this program is perfect. It is not. All of us realize that such programs cost a great deal of money, and there is no doubt but that the Kerr-Mills legislation will serve to ease the financial burden of caring for the needy aged. Our existing State and local hospitalization program provides a mechanism through which the provisions of the Kerr-Mills legislation will be administered in a most satisfactory manner. The Medical Society of Virginia sincerely believes that Virginia should have an opportunity to prove this contention.

The Blue Shield movement in Virginia was sponsored by the Medical Society of Virginia and the interest of our members has never waned. As a matter of fact, the society enjoys the privilege of each year naming 12 members of the Board of Directors of the Virginia Medical Service Association-better known as the Richmond Blue Shield plan. These 12 members also double as a standing committee of the society and submit a formal report to the membership each year. Perhaps it should be said that the society is also well represented on the boards of Virginia's Blue Cross plans.

A very active liaison is also maintained with the health insurance industry through a special committee on voluntary health insurance. As a result of this relationship with both Blue Cross-Blue Shield and the commercial companies, some giant steps have been taken to strengthen the position of the aged with respect to medical care. For example, in March 1959, the Council of the Medical Society of Virginia recognized the importance of helping out those older citizens who needed assistance medically, where their resources were too modest to afford full financial participation, by

(1) stressing that it is the responsibility of the local political subdivision in which the individual resides to provide medical care when not otherwise obtainable; and

(2) indicating the necessity of voluntarily working out cooperation between the medical profession, the Blue Shield-Blue Cross plans and the private indemnity insurance companies to afford coverage, where necessary, at the lowest possible cost to those who need it in the over 65 age group.

We adopted a resolution which—

(1) asked the members of the society to continue their policy of providing medical service regardless of the ability to pay and especially in the aged group to recognize the importance of rendering services at the lowest possible cost;

(2) asked the members to accept reduced fees under special insurance coverage to be provided by Blue Cross-Blue Shield and indemnity companies at reduced rates to those with low incomes; and

(3) asked the above-named plans and the private indemnity companies in Virginia to try to make such coverage available. This resolution served to further stimulate efforts of the various carriers to bring forth new and improved plans designed especially

for those over 65. I am pleased to report that the largest Blue CrossBlue Shield plan in Virginia now has such coverage in effect.

This means that we are providing assistance to those who really need it, and at the same time making it possible for others over 65 to obtain health insurance at reduced cost.

In an effort to coordinate the activities of those organizations directly concerned with health care of the aged, the Medical Society of Virginia has taken the lead in organizing the Virginia Joint Council on Aging. Associated with it are the Virginia Hospital Association, Virginia Dental Association, and the Virginia Nursing Home Association.

It has been estimated that to tie health care of the aged to the social security system would cost our already overtaxed Virginia residents an additional $15 million-perhaps more. This seems almost unthinkable when it is considered that no real need for such expenditure has ever, to our knowledge, been demonstrated.

All in all, we believe that the situation in Virginia is under control and that no person, regardless of age, need go without needed hospital and medical care because of inability to pay. We are strongly opposed to H.R. 4222, or any other bill, which would deny Virginia the right to administer any program affecting the health care of its citizens, and which would substitute a bureaucratic program of unpredictable cost for a program which, already, has been proven to be fundamentally sound.

The CHAIRMAN. We thank you, sir, for bringing to this committee your discussion of your views. Are there any questions of Dr. Bates? Dr. Renger and Dr. Davis.

I see our colleague from Texas, the Honorable Clark W. Thompson. You gentlemen are pretty well escorted. Would you like to present them, Mr. Thompson?

STATEMENT OF HON. CLARK W. THOMPSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS

Mr. THOMPSON. Mr. Chairman, Dr. Harvey Renger is the president of the Texas Medical Association. I have known him for more years than I like to admit. I knew him first when he was in medical school in Galveston when he and I used to play tennis, believe it or not, in our backyard. We continued that until he met the girl across the street, the prettiest girl in the neighborhood, and then he quit playing with me.

He graduated with distinction, served his internship and after that could have gone into a number of very prominent groups or firms of doctors. He elected instead to go back to his hometown, a relatively small community called Hallettsville, Tex., and there he went into practice with his father who was one of the famous country doctors of that time. His father passed on and Harvey took on the practice.

It is interesting to note that he built a clinic there, one of the most modern and up-to-date in the country. He told me today something that I did not know before. It was done with all private funds. No public money went into it at all. He can render any service that can be rendered in any hospital or clinic-practically any; I think he

would deny he could perform them all, but he certainly ministers to the people of that vicinity and in the communities around.

He is a general practitioner. He calls himself a country doctor which as a matter of fact he probably is. However, he was selected by the doctors of Texas to head their association which shows the esteem in which they hold him.

There is one little anecdote and if you will indulge me a moment more I will tell you of Dr. Renger's acceptance in the area.

I went to call on a family way out in the country. The mamma came to the doctor, obviously ill, looking very badly, and by herself out there on the farm. I asked her what was wrong and she said she felt very very badly, but she said it was going to be all right. I have phoned to Dr. Harvey and he is going to come to see me, and when he says he will be there to see me, I begin to feel better already.

Thank you very much for giving me the opportunity to introduce this very constituent of mine.

The CHAIRMAN. Thank you very much for your fine introduction. I must say you young men look to me like you could still do a pretty good job of playing tennis.

Mr. ALGER. Sitting on Dr. Renger's left is a pillar of Dallas society, Dr. Milton Davis. Without any prejudice to Dr. Renger, I do not want to let this wonderful opportunity pass to introduce Dr. Davis who is one of our fine doctors in Dallas, and a pillar of society, and we are glad to have you with us.

STATEMENT OF HARVEY RENGER, M.D., PRESIDENT, TEXAS MEDICAL ASSOCIATION; ACCOMPANIED BY DR. MILTON V. DAVIS, A DALLAS THORACIC SURGEON

Dr. RENGER. Mr. Chairman and members of the committee, I am Harvey Renger, and I reside in Hallettsville, Tex., where I am engaged in general practice and surgery. I appear before you today as president of the Texas Medical Association. Accompanying me is Dr. Milton V. Davis of Dallas, a thoracic surgeon.

Our association has a membership of 8,500 doctors of medicine, representing approximately 93 percent of the physicians in Texas. Our association is a professional, scientific organization. Our primary objective is to provide the best medical care possible to the people of our State.

We believe that medical care should be available to all citizens of Texas, regardless of age or ability to pay. We believe in helping those who need assistance in financing their medical care costs. But we do not believe that the tax dollars of employers and the working people of our State should be used to finance medical care for those individuals who are able to pay for it themselves. We strongly favor individual, local, and State responsibility in health care for all people. We vigorously oppose H.R. 4222 because it undermines this philosophy, and forfeits responsibility to the Federal Government.

Texas physicians have been interested in our aged citizens for years. After evaluating the medical needs of the aged population in our State, and medical resources which presently are available to them, it is clearly evident that health care for the aged financed by the social security taxing system would not solve their problems.

May I report that there are 745,000 persons in Texas aged 65 or older. This represents approximately 8 percent of the people reported in our 1960 census.

Contrary to the views expressed by some, the majority of the aged in Texas are not sick, nor are they unable to provide themselves with adequate medical care out of their own resources.

At present, an estimated 175,000 of the total aged, or 24 percent, are gainfully employed. Many others are spouses of wives or husbands who are working; 73,000 aged Texans receive income from private retirement or pension plans. About one-third of our aged, or 245,000, receive income from dividends, interest, rent, and other sources. Ten percent of our aged Texans are assisted financially by their children and relatives. The role of governmental agencies also is significant as a provider of financial resources for our aged. More than 406,000 receive OASDI payments; 221,000 qualify for old-age assistance benefit payments. In addition, 96,000 Texans are recipients of governmental funds through veterans pensions or veterans compensation, railroad retirement, civil service retirement, teachers benefits, and general assistance, and other State and local programs.

We particularly wish to commend the resourcefulness of our aged population, and their desire to provide for themselves. We are impressed by the fact that 70 percent of the aged either own their own homes, or have a sizable equity in them.

Our State association has compiled considerable information on the general health of aged Texans, on medical and hospital care costs for those 65 and older, and on resources for paying for these services. A survey made earlier this year by the Texas Medical Association on medical services provided us with factual information. Responses from 3,100 of our members reveal that the old folks in our State generally are in good health. Texas physicians rate 64 percent of their patients who are aged 65 or older in good general health. Fair health ratings were given to 32 percent of the aged patients, while health of the remaining 4 percent was rated as poor. May I emphasize that these figures represent the reports of Texas physicians on their own patients.

For the year 1959, aged Texans incurred a median expenditure of $260 for all medical care services.

For those aged who have incurred illnesses, valid research studies are available. These studies refute statements by an advocate of social security medical care who has claimed that the average cost of an illness to the elderly is $1,000, representing a $450 hospital bill and a $550 doctor bill. A survey of patients aged 65 or older discharged from All Saints Hospital in Fort Worth reveals that the mean average hospital bill was $384. Total charges by physicians for those illnesses amounted to a mean average of $115. Thus, the mean hospital bill and fee by the physician was $499.

In financing health care costs, the survey reflects that the vast majority of the aged utilize four primary media. Physicians report that nearly 30 percent call upon voluntary health insurance to pay for their bills, while 29 percent pay for services through current income or savings. Almost 16 percent of medical bills incurred by the aged are paid for by the family, while governmental agencies pick up about 6 percent of the costs. In about 12 percent of the cases, the physician renders his professional services without charge.

Charges are reduced by the physician in another 23 percent of the total cases.

From these research studies and facts, we believe it is evident that a program of federally controlled and operated medical care is not needed to provide our people with adequate health care.

In keeping with American traditions, we believe that the individual should retain the primary responsibility for his own medical care. When the individual is unable to provide this care for himself, the responsibility rightfully should pass to his family, then to the community, the county, and the State. Only when all of these fail should the Federal Government assume a role, and then only in cooperation with other governmental bodies. Specifically, we believe that the Federal Government should not assume full responsibility solely upon the basis of default by individual, community, and State

resources.

The Texas Medical Association recognizes that the physician traditionally has accepted the responsibility to provide professional services to his patients, regardless of ability to pay. This is no hollow statement of philosophy; it is a principle to which the great majority of Texas physicians adhere and actually practice. Our recent survey revealed that the average Texas physician devoted 61 hours to the practice of medicine each week. Of that time, the Texas physician gives 72% hours, or approximately 12 percent in professional services to patients who are unable to pay. The publication, New Medical Materia, reports that Texas physicians donated services worth more than $31 million to their patients in 1960. In addition, the physician provides services to many other patients at reduced fees. I feel confident that Texas physicians will continue in the future to provide medical service for the aged, including the indigent and the near needy, at fees they can afford, or without charges, as their resources might indicate. I also believe that the vast majority of Texas physicians would prefer to make available professional services to the needy aged either without charge, or at reduced fees, in preference to receiving compensation from a program which we regard as socialized medicine.

On the basis of our experience in Texas, I would like to report that voluntary health insurance has proved to be an effective mechanism for financing health care costs. The record of Blue Cross-Blue Shield and commercial insurance companies in our State is particularly noteworthy. Until a few years ago the Texas Blue Cross plan did not attempt to enroll people aged 65 and over who did not enter through an associated group. In October 1959, Blue Cross conducted a special 1-month promotional campaign to enroll the aged. That campaign was most successful, and enrollment privileges have been extended twice since that time. At present, approximately 80,000 persons are enrolled. They pay from $5.96 to $6.50 monthly, depending upon the type of service they have. Blue Cross figures indicate that these policies pay an average of 86 percent of the hospital bill. In a high majority of medical bills, Blue Shield allowances are accepted as payments in full by physicians, even though they do have the prerogative of charging their usual and normal fees.

It is also significant that 164 commercial companies now make available health insurance policies to Texas residents who are 65 years of age or older. Through these recent efforts, an estimated