It must be remembered, too, that the $204 annual premium cost for the basic and major medical policies would take care of only a part of hospitalizations, surgical fees, and physicians' fees while a person was hospitalized, and of nursing-home care to a degree. That sum ignores completely the money an aged person must spend on physicians' fees for home and office visits, on drugs to treat chronic diseases and the like. Dr. Allen Butler of the Harvard Medical School, in testimony on the Forand bill before the Ways and Means Committee in July 1959, stressed the importance of health costs for other than surgical and hospital care: "It is well known that the major types of illness afflicting the aged are not surgical-they are the diseases of the heart and blood vessels, and nervous system, the degenerative disorders, and a wide range of other medical conditions which collectively outnumber the major surgical problems of the aged. Moreover, even the indivdual requiring surgery frequently must receive care also from a nonsurgical specialist or general practictioner before, during, or after surgery. Lastly, regular medical supervision and preventive services are essential to minimize or prevent the impaired health and major disabilities caused by the aging process and chronic disease." In this connection it is interesting to note a statement on page 10 of the background paper prepared under the direction of the Planning Committee on Health and Medical Care for the White House Conference on Aging held in January 1961. *** While they (the aging) use physicians' services more frequently than the rest of the population, the vast majority of these contacts occur in the doctor's office, in a clinic, or by telephone. Most of their medical problems are cared for on an ambulatory basis or in their own homes. About 5 percent of the people aged 65 and over are institutionalized. While the incidence and duration of hospital care are greater than for younger people, most of their stays in general hospitals are not protracted. ***** Dr. Leonard W. Larsen, presently president of the American Medical Association, was chairman of the Planning Committee. Major medical insurance, or as it is sometimes called, catastrophic illness insurance, is not the major problem of the aged, especially if an aged individual must spend $204 of his limited retirement income to be covered against long-term illness. Even among the older population, more prone to serious and long-term illness than the remainder of the population, the incidence of major illness is such as scarcely to warrant depleting limited retirement budgets so that older persons could not pay for their day-to-day medical needs. In any event, the Connecticut policy will not take care of the major medical problem. Benefits are limited to $2,500 in any one year. Arthur S. Flemming, when he was still Secretary of Health, Education, and Welfare, testified at a Senate Finance Committee hearing that "$6,000 is a conservative estimate of total medical expenditures incurred by persons who are continuously ill for an entire year." We turn now to a brief discussion of the ability of persons on retirement income to purchase the Connecticut policy. We think it highly unlikely that many of Connecticut's retired residents will be able to spend $204 on this policy, or that many of Connecticut's retired couples could spend $408. Of Connecticut's 243,000 residents over 65, the Department of Health, Education, and Welfare estimates 168,000 have an annual income of $1,550 or less. Can a person living on this meager income afford to spend 13 percent of it on policies which will pay only a portion of his medical expenses? In the November 1960 issue of Monthly Labor Review of the U.S. Department of Labor appears a Bureau of Labor Statistics budget for a retired couple for 20 major cities, based on autumn 1959 costs. The budget includes estimates of costs of goods and services for a couple living alone in a two- or three-room rental dwelling. No Connecticut city is included, but the New York City figures may be used as an area of comparable cost. The budget for a couple in that city is $3,044. Of this, $262 is estimated for medical care. Compare this figure with the $408 a couple would pay for the Connecticut basic and major medical plans. Medical care in the budget includes home, office, and hospital physicians' visits, specialists' (surgical) fees, dental care, eye care, group hospitalization insurance plan, hospital room anesthesia, drugs, and other medical care. It should be noted that many of these items would not be included in the Connecticut basic and major medical insurance policy. Parenthetically, attention is called to the frequency of use of the services covered by the Connecticut policy through an examination of the kinds and quantity of medical care services included in the BLS budget. The attached table gives this information. The major conclusion to be drawn from these BLS budget figures is that a couple living modestly on a $3,000-a-year income would expect to spend about $260 a year for medical care. How then could that couple be expected to spend $408 for a policy which would cover only part of their hospital and surgical fees? In conclusion, we should like to refute a statement made by Mr. William N. Seery, vice president of Travelers Insurance Co., in his testimony before the Connecticut Legislature on behalf of the insurance companies' program, and read into the Congressional Record by Congressman Thomas Curtis of Missouri on June 19, 1961. Mr. Seery said, "To the extent that we can successfully sell this coverage to individual older people, then to that extent the State of Connecticut will save tax dollars." We cannot conceive that a single dollar of Connecticut tax dollars will be saved. Certainly the 168,000 Connecticut residents over 65 who have an income of $1,550 or less will not be able to purchase basic and major medical insurance for $204. And it is exactly these people who are medically indigent and so eligible to have Connecticut tax dollars spent on them for medical care under the Kerr-Mills program. In any discussion of this critical problem of meeting the medical care cost of our senior citizens, we inevitably return to the logic of prepaying during one's working life for medical care needs when one retires and is living on reduced income. The Connecticut State Labor Council vigorously supports H.R. 4222 and hopes that the Ways and Means Committee will give the bill its favorable consideration. BLS INTERIM BUDGET FOR A RETIRED COUPLE TABLE 6.—All other goods and services budget quantities "The average number of operations per year for an elderly man is 0.072; for an elderly woman, 0.053. About 60 percent of the operations among the men involve a genito-urinary condition, repair of hernias, or operations on the eye. Reduction of fractures and dislocations, operations on the eye, or conditions of the genito-urinary system accounted for 60 percent of the operations among elderly women. 10 Estimated cost is 98.6 percent of cost of fillings, extractions, and cleaning. 11 Estimated average cost in 1959; differs from city to city. 12 Requirements specified for hospital services do not apply when the cost of these items is covered by a hospitalization insurance plan. 13 The budget assumes 45 percent of the couples have a family membership in a group hospitalization insurance plan. In cities where plans do not fully cover the cost of hospital ward accommodations and specified ancillary services, an additional allowance covering the cost of these benefits is provided. 14 Estimated average cost in 1959. 15 Average prices for items selected to represent all types of prescriptions and non prescription drugs com. monly required by the family weighted by their relative importances in the category of therapeutic end use in which they were classified. 18 Cost is 5.2 percent of total cost of prescriptions and drugs. Source Monthly Labor Review, November 1960, vol. 83, No. 11. DELAWARE STATE LABOR COUNCIL AFL-CIO, Chairman WILBUR D. MILLS, House Ways and Means Committee, New House Office Building, Washington, D.C. DEAR CHAIRMAN MILLS: On August 1, 1961, William O. LaMotte, Jr., appeared before your committee as chairman of the Committee on Public Laws of the Medical Society of Delaware in opposition to H.R. 4222. I am directing this communication to you to ask its inclusion in the record which is open until August 18. First, I submit for the record the Delaware State Labor Council AFL-CIO's endorsement of H.R. 4222, known as the Anderson-King bill, providing health benefits for the aged through social security. Secondly, I submit for the record a reply to Dr. LaMotte's testimony relative to a study made in Delaware which he purports contains "detailed and up-to-date knowledge of the ability of our older population (in Delaware) to pay for hospital care." This study titled, "An Interim Report on the Aged Inpatient in Delaware's General Hospitals," is not a complete report. It is as titled, only an interim report; it covers only 5,690 of the 35,000 older citizens of our State. It covers only the aged patient in general hospitals. It cannot conceivably be established by the statistics or by a wide stretching of the imagination, that the conclusion of this interim report demonstrates "the ability of our older population to pay for hospital care." The Delaware State Labor Council feels health benefits for the aged through social security are needed as much for Delawareans as for other citizens in these United States. Sincerely, JAMES J. LAPENTA, Jr., Vice President and Legislative Chairman. STATEMENT BY FRANK G. ROCHE, PRESIDENT, FLORIDA STATE FEDERATED LABOR COUNCIL, AFL-CIO The Florida State Federated Labor Council, AFL-CIO, urges the Congress to provide health benefits through social security for the aged along the lines of the King bill, H.R. 4222. We are convinced that the Kerr-Mills bill, passed in 1960, cannot do the job here in Florida. We have not been able this year to get the State legislature to take advantage of the new program of medical assistance for the aged although we tried to do so. We prefer health benefits through social security because we do not like the public assistance approach, which uses a means test. No one likes having to swear that they're needy or having social workers check on their income and the amount of life insurance and savings they have. But we did want something more done for the aged, even if it did mean public assistance. What happened in Florida ought to be of especial interest to your committee because Dr. Edward R. Annis, who comes from Florida, has been one of the chief spokesmen for the American Medical Association in attacking the King bill and boasting of how much the Kerr-Mills law is doing. I am personally acquainted with Dr. Annis for many years. He was too optimistic regarding the intention of the legislature. Governor Bryant campaigned on a no-new-tax platform and he and the appropriation committee of both house and senate adhered to this policy adamantly. The possibility of a special session to consider an additional tax levy is remote. Dr. Annis told the country on a nationwide TV debate with Walter Reuther in February that Florida was going to pass a bill for medical assistance for the aged and that it would be a good one. But the Florida legislature adjourned without passing a bill necessary to provide medical assistance for the aged. One reason was that it would have cost too much money. The State welfare people and the State health people disagreed as to how the money could be raised. They knew there was a problem but they couldn't get the support to do anything about it. So now the needy aged can get health care through the public welfare system of Florida only if they have lived here 5 years and if they meet the very strict means test that's applied. Even if the State welfare board's recommended bill had been passed by the legislature, it would not have been nearly as liberal as Dr. Annis said in his debate. He suggested there would be an income limit of $2,000 a year for each person. But the welfare board's recommendation was $1,200 for a single individual and $2,400 for a couple. Dr. Annis said people would be allowed to have liquid assets of up to $2,000. But the State welfare board recommended much less, probably $600 for a single person and $1,200 for a couple, including cash, bank balances, paid-up value on life insurance, etc. The health services that would have been paid for under the welfare plan would also have been very limited but even those involved a cost that was too much to win support from a majority of the State legislature. The issue of health care for the aged is of particular interest to the citizens of Florida because of the large number of older people here. There are now more than half a million people 65 years of age or more in Florida, and the number is 2 times as great as in 1950. Some have grown up here. Many have come from other parts of the country to enjoy Florida's fine climate and other advantages. But all of them know that they may need to go to the hospital next year, or even this year. They want to get the kind of medical care that will keep them out of the hospital as long as possible. Most of them don't have any too much extra money. It would be a great help to them to know that they could count on having 90 days of hospital care paid for through social security as the King bill plans. It would also be very helpful to have benefits covering a stay in a skilled nursing home for 6 months if necessary, and at least part of the cost of X-rays and other outpatient diagnostic care from hospital clinics. The King bill provisions for home health services for up to 240 visits a year would make it possible for many older people here to stay on in their own homes rather than having to go into a hospital or other institution. The older people of Florida know how valuable social security benefits are. Seventy-six dollars a month, which is the average old-age benefit paid in Florida, means a lot but it doesn't go very far in helping to pay for high-cost drugs, doctors' fees and hospital or nursing expenses on top of rent or payments on a house, food, clothes, other necessities, and a few luxuries. Four out of five aged persons in Florida, or 440,000, would get the benefits of the King bill. Something like $34 million in health benefits would be paid out for them in 1 year. The King bill would thus do a lot of good in our State not only for the older people themselves but for the entire community. We could then hope for more good nursing homes, hospitals and nursing services to keep up with the growing number of older persons. It isn't easy for people to buy private insurance out of their low incomes. Of course many insurance companies won't take older people unless their health is normal, which may mean they have to pass a medical test or that existing conditions may be excluded. The Florida Blue Cross Association has not developed a special hospital plan for senior citizens. People over 65 can join if they want, but preexisting conditions are not covered. A health statement is required, and there is a waiting period of 270 days for hernias and hemorrhoids. But even if an older person does get accepted, not more than 31 days of hospital care will be paid for in each spell of illness, with a maximum of $12 per day for room and board. Patients have to pay 50 percent of the first $100 of charges in the hospital for drugs, diagnostic X-rays and anesthetics, although the plan pays all charges from $100 up to $500. In connection with laboratory services, there is an exclusion of section examinations and pathological examinations. The King bill would give us much better protection, and the aged would not have to pay anything after they've retired. They would be relieved of worry about the disastrous cost of long illnesses, and they would be able to get better hospital and nursing care. They would still have some medical bills to pay but these would be easier to meet. This spring Congressman Rogers of Florida sounded out public opinion on this question: "Do you favor the proposal to make a compulsory medical care plan for the aged part of the social security program?" Fifty-five percent of the answers were yes; 45 percent no. supports the King bill. So it is not organized labor only that Senator George Smathers stated in a press release, Miami Herald, August 9, 1961, that it was his intention to hold a hearing in Florida of his retirement subcommittee, giving as a reason that there were almost 500,000 people on social security in our State. The State of Florida has a population, according to the 1960 census, of 4,951,560 which pinpoints the startling fact based on the above figures that practically 1 out of every 20 persons in Florida are under social security. We have also a very critical problem of Cuban refugees to deal with in this State. We do not know exactly how many are in Dade County at the present time, or in Florida. We are sure that in 2 years or more this number has been increased daily at a rapid rate. These unfortunate people have taken jobs at almost any kind of price, based on their dire need, to attempt to survive and thus causing thousands of Floridians to compete for jobs, or receive reduced wages, as a result, and the large surplus of unemployed refugees, all of this has created great hardships particularly in south Florida. We are wholly in accord with the necessity of taking care of the Cuban refugees, but we believe the Government should play a bigger role in the matter and they have not done enough. As a result, it has caused great hardship on the Floridians. Only recently, they have started to bring in Federal surplus food. Labor and many other organizations are urging this type of aid from the Government. There have been several surveys made. The welfare division has made a statement that they did not see the need of surplus food. At that time, they did not intend to request a program such as many other States have. The Miami Herald is also a source of a statement that in a national survey it was shown that Miami ranked third highest State in the Union of students dropping out of high school to go to work. This is all a result of our precarious economic condition. We urge that this statement be made part of the record of the Ways and Means Committee and we believe they will present a more true picture of the conditions as they exist in our State. INDIANA STATE AFL-CIO, Indianapolis, Ind., August 16, 1961. Representative WILBUR D. MILLS, Chairman, Ways and Means Committee, U.S. Congress, Washington, D.C. DEAR REPRESENTATIVE MILLS: We of the Indiana State AFL-CIO who represent 300,000 members of organized labor, urge that you support the bill that will provide medical care for the aged under social security. Under the present system we find many of our senior citizens sorely in need of medical attention and we feel this is an equitable manner to provide this care. Hoping that your committee will recommend this bill out of committee as "do pass" and with best regards, I remain, Yours truly, MAX F. WRIGHT, LEO H. IRWIN, IOWA FEDERATION OF LABOR, AFL-CIO, Chief Counsel, Committee on Ways and Means, DEAR SIR: This letter is in regard to the President's health insurance proposal H.R. 4222, the Health Insurance Benefits Act of 1961. This letter is for presentation to the committee record. It should be noted before this committee that we in Iowa are particularly interested in the proposal H.R. 4222 because of the fact that in the most recent session of the Iowa Legislature a bill passed which would have allowed Iowa to participate in the existent Federal medical care program but the legislature openly and callously in passing this enabling act did not appropriate any funds for carrying it out within the State. Thus the aged citizenry of our State finds itself completely without any protection against the extremely high |