he may choose. Such a situation would, I believe, destroy the relationship between a doctor and patient, which has been successful throughout the years of advancement of medicine and medical care in the United States. I know the long hours my doctor works. I know that he must and is willing to devote a great portion of his time to charity. I know his feelings toward his patients, and his patients' feelings toward my doctor. I sincerely believe that we must be continually on guard to oppose any encroachment upon the freedom of choice of both the doctor and his patient and request that this committee refuse to recommend the enactment into law of H.R. 4222. Hon. WILBUR D. MILLS, Chairman, House Ways and Means Committee, LIFE INSURERS CONFERENCE, DEAR CONGRESSMAN MILLS: The Life Insurers Conference is an association of 91 life and combination life insurance companies engaged in providing life and voluntary health insurance. These companies are domiciled in 24 States and the District of Columbia with a predominance of membership in the South and Southeast. This association is vitally interested in the various proposals dealing with health care for the aged, and strongly urges the House Ways and Means Committee to reject H.R. 4222. Respecting your request that organizations and individuals with a similar interest and position avoid repetitious testimony, we did not attempt to file a lengthy statement nor request time for appearance. We, however, wish to go on record as endorsing the able statement made on July 31, 1961, by Mr. H. Lewis Rietz, who appeared on behalf of the American Life Convention, the Health Insurance Association of America, and the Life Insurance Association of America. Life Insurers Conference has supported the Kerr-Mills bill and continues through its appropriate committees, and by proper means, to encourage the various States to immediately participate in the implementation of that program. We believe that the Kerr-Mills approach is the best program yet offered to take care of the aged people who are actually in need of help in meeting their medical bills. Respectfully yours, CHARLES E. PHILLIPS, President. CONGRESS OF THE UNITED STATES, Hon. WILBUR D. MILLS, Chairman, Committee on Ways and Means, DEAR COLLEAGUE: Enclosed please find a letter addressed to me from my constituent, Mr. Claude Millsap, president of the Juneau Credit Service Co., Inc., expressing opposition to H.R. 4222, a bill to provide for payment for hospital services, skilled nursing home services, and home health services furnished to aged beneficiaries under the old-age, survivors, and disability insurance program. I herewith submit said letter for inclusion in the record in opposition to said bill, in connection with the hearings presently being held thereon. Thanking you, I am, Sincerely, Congressman RALPH J. RIVERS, Washington, D.C. RALPH J. RIVERS, Member of Congress. JUNEAU CREDIT SERVICE CO., INC., DEAR SIR: We oppose this bill on the grounds that mainly it would deny even those limited services to millions of the poor and destitute who can never qualify for social security. A favoring of the rich at the expense of the poor. Please consider this carefully and if you agree, please help defeat the measure. Sincerely yours, CLAUDE MILLSAP, President. BLUE SHIELD MEDICAL-SURGICAL PLAN To the Committee on Ways and Means of the U.S. House of Representatives: The enactment of H.R. 4222, known as the Anderson-King bill, would not solve the problem of health care for a large number of people over 65 who are not covered under social security. It still leaves a large part of the indigent population in the upper age brackets entirely uncovered. Likewise, a goodly per: centage of those who are on social security, who would be covered under this bill, already have excellent protection under Blue Shield and other insurance plans and do not need any tax-financed health program. Thus, we believe that such a program would be economically unsound and would cost a great deal of money in proportion to the benefits provided. In Illinois alone, we estimate that over 150,000 people over 65 already belong to our Blue Shield plan and its companion Blue Cross plan, either as retired employees of firms where they have been employed during their working years or as individual direct-pay members. The same is true in other States where other Blue Shield and Blue Cross plans also cover large numbers of people. Here in Illinois we also have a special over 65 Blue Shield program which over 6,000 physicians in the State have signed to support as participating physicians. Under this program these physicians will accept Blue Shield payments as payment in full for services to either 1. An unmarried subscriber whose annual income does not exceed $2,000 and who has a net worth of $15,000 or less. 2. A married subscriber whose annual income, together with that of his spouse, does not exceed $3,000 and who has a net worth of $20,000 or less. Similar "Over 65" plans are offered by Blue Shield plans in other States. Thus, we believe that voluntary Blue Shield medical-surgical plans and also voluntary Blue Cross hospital plans are making a concentrated effort to solve health care problems of the aged on a local basis. We further believe that this problem can be met more economically and at a lower cost on a local voluntary basis or through a program encompassed by the Kerr-Mills legislation passed last year, which has been adopted by many States. We likewise believe that the system of medical practice as developed in the Therefore, we urge you to consider all of these facts carefully, and we believe that it should be preserved. Therefore, we urge you to consider all of these facts carefully, and we believe that you will concur that the Anderson-King bill should not be passed. BOARD OF DIRECTORS, By R. T. EVANS, Executive Director. MINNEAPOLIS, MINN., June 28, 1961. Representative WILBUR D. MILLS, Chairman, House Ways and Means Committee, DEAR SIR: This is to register my firm opposition to Government medicine or the meddling of the bureaucrats in medical practice, as proposed in the King bill (H.R. 4222). I request that you insert my letter in the committee's hearings. Any phase of private enterprise which the Government has meddled in has built up huge bureaus and has wasted billions of dollars of the taxpayers' money. I'd much rather have that tax money to spend as I please toward payment of my own choice of physician and hospital, and then if I did not need them I'd have that money to buy other things I need urgently. This is a republic-not a Socialist state. I'm past retirement age, considerably, but prefer to continue working as long as I am able. Offhand, I can't recall any enterprise which the Government has meddled in that it has not made a mess of it-i.e., agriculture, etc. And the power to tax is the power to destroy. Copies of this letter are being sent to all nine Minnesota Congressmen. Yours truly, (Miss) GOLDIE CREVER. P.S.-I know that the politicians promise that we would have freedom of choice in Government medicine but that is a ruse to get their Socialist schemes passed, then they begin to "put on the screws." Look at the farmers. 76123-61-pt. 4——34 JULY 6, 1961. Hon. WILBUR D. MILLS, Chairman of the House Ways and Means Committee, DEAR SIR: This letter was written to tell you that I am opposed to the King bill (H.R. 4222). I do not believe that health benefits for the aged should be put under the Social Security Act. Please have this letter inserted in the committee hearings. Thank you for your consideration in this matter. Sincerely yours, DOROTHY H. WEINER. DULUTH, MINN., July 10, 1961. Re the King bill (H.R. 4222). Representative WILBUR D. MILLS, Chairman, Ways and Means Committee, Washington, D.C. DEAR SIR: This is in opposition to the King bill. It would be a calamity to approve this bill which leads to socialized medicine. Very sincerely, Please insert this in the committee's hearings. ARTHUR N. COLLINS, M.D. NEW YORK, N.Y. Re H.R. 4222, health insurance proposal-Health Insurance Benefit Act of 1961. To the HOUSE COMMITTEE ON WAYS AND MEANS, 1. LACKS FAIRNESS IN COVERAGE Extending health insurance benefits only to people on social security is most unfair and discriminatory against the older citizens who never had an opportunity to work for social security units and so do not receive social security benefits. For example, the older retired teachers in New York City have small pensions and no social security benefits because New York City teachers were only included in the social security program in January 1958 so they never had an opportunity to work for social security units. Many prosperous business people and executives are paying in for social security benefits and at 65 would be entitled to health insurance benefits whereas the older people who never were able to earn units would not get any health insurance benefits. Therefore if this Health Insurance Benefit act has any chance of passing (which it should not) the least that should be done is to give minimum social security benefits to all people 70 years or older who never had an opportunity to earn social security units while they were still active. 2. NO NEED FOR LEGISLATION ON HEALTH INSURANCE BENEFIT ACT OF 1961 It is not needed for the measure would only lead to socialized medicine and a socialized welfare state. It is not what the people want. It is what the administration wants for they see it as a vote getter and they believe in socializing our country. We the people do not want it. The administration is so liberal in piling more unemployment relief on able bodied jobless (many of whom could and would find work if the relief were not extended) and giving lavishly to foreign aid yet in this Health Insurance Benefit Act of 1961 it gives no thought to many older citizens who get no social security benefits. It is not humane to say that that group is small. 3. ALTERNATE SUGGESTION (a) Have no legislation on this Health Insurance Benefit Act of 1961. (b) Increase social security benefits $5 a month for all who receive less than $100 a month benefit and let each individual take care of his own health insurance. (c) Give minimum social security benefits to all 70 years or older if they were unable to work for social security units while they were still active. Then they, too, can take care of their own health insurance. (d) Urge all people to invest in some form of health insurance if they have not already done so. We would appreciate it if you would include our statements in the printed record of the hearings. Miss JOHANNA ZIEGENHAIN, JULY 6, 1961. Hon. WILBUR D. MILLS, Chairman of the House Ways and Means Committee, House of Representatives, Washington, D.C. DEAR SIR: Please insert this letter in the committee hearings on the King bill (H.R. 4222) as it is my belief that the health benefits for the aged should not be put under the Social Security Act. Thank you for your consideration. Sincerely yours, Mrs. SANDRA J. HOFFMAN. STATEMENT OF W. RULON WILLIAMSON, RESEARCH ACTUARY, WASHINGTON, D.C. Illusion COMPULSORY CHARITY THROUGH SOCIAL SECURITY I am attaching four pages from last week's Saturday Evening Post (July 29, 1961) to show the treatment of three-dimensional subjects in two-dimensional pictures. Two pictures on page 64—“Solid and Hollow” and “Day and Night”— indicate the intentional creation of illusion. In "Solid and Hollow," as one looks at an upper surface, on which one could walk, it changes to the under side of an arch. In "Day and Night," one can see the flying geese headed east into the night, till suddenly the background between the geese becomes geese flying west into the day. Social Security The "welfare state" is full of such surprises. Social insurance, called applied Christianity by Bismarck, seems, at times, to have led into World War I and World War II, that Christian impulse in Germany seeming to become "The Road to Serfdom." The night of personal inability and incapacity, local community ineptitudes, over-extended local budgets, invite aid from sovereign States and then from National Government. But as the day grows bright with the multiplicity of aids, the hand of help falters as it is obvious that, in the long run, the person to be helped is the person taxed for the help. The magic of outside aid changes to more taxation, inflated prices, steadily enlarging need. Social security, as used in discussing this bill, has narrowed from the whole fleet of illusions-old-age and survivors insurance, unemployment compensation, aid to the needy aged, aid to the needy children, aid to the needy blind, aid to the permanently and totally disabled, aid to crippled children, miscellaneous vendor payments for medical care to that single illusion, "old-age and survivors insurance." OASI is the senior member of the completely national programs, which move beyond the parochial limitations of town, county, State, to a National Government of 50 States. (Even more alluring, in the shadows comes the goal of moving out into world government.) The camel's nose under the tent flap OASI began to operate through the Social Security Act of 1935 as old-age benefits. Tax collection and benefit payment started in 1937. It became OASI through the amendments of 1939, effective in 1940. At that time, an important security anchor was the reserve (now called the trust fund). It was to grow from nothing on hand at the beginning of 1937 to $47 billion in 1980. That first year, 1937, the tax was half a billion dollars. The benefits were a million dollars. We had saved dollars of high purchasing power against the threat of future old-age need. Here was high resolve-communal resolve. In 1939, the employees, the personal payers of taxes, were joined by wives and children as dependents of the employees and as potential dependent survivors of those employees at the deaths of such employees. By 1950 the million dollar benefits had grown to a billion dollars-the taxes from $0.5 to $2.7 billion. We weren't scared yet, and the trust fund stood at $13.7 billion enough for 14 years of benefit-payment at the 1950 rate. There were even high-level pronounce ments of overfunding. Then came amendments-biennial amendments. In 1960 the taxes had reached nearly $11 billion. The benefits and operational expenses had also reached $11 billion. The trust fund was $20 billion-falling off from a higher figure-and not enough for 2 years payments at the 1960 level. The yearly margin of taxes over benefits and expenses had disappeared. Moreover the 1939 emphasis upon benefits for early deaths had piled up death benefits somewhat larger than the interest received on the trust fund, twice as high in the year 1960. On ahead this actuarial reviewer sees possible benefit outlay to those now covered-some record of personal OASI taxpayment-thus barring from consideration the coming taxpayers from the baby boom of the last 15 years-of $2 trillion-spread over 50 years, the average recognition of coming liability would be $40 billion a year. H.R. 4222 The camel isn't way in yet-though the progress is noteworthy. Under H.R. 4222 is another proposal for benefits to the aged. Some of the medical costs of the aged are to be added under the social security approach of OASI. This could be either another camel gently nosing under the tent flap, or the same camel moving the hump in. At the end of 1960 some 8 million primary-age beneficiaries were on the OASI rolls. A study I have recently made would indicate that these extaxpayers had paid personal taxes approximating 3 percent of the total age benefits paid and yet payable to them and their dependents. Cost guesses Over the last century, the mortality rates by age have shown a certain orderliness and improvement so that life insurance during working years (say up to age 65) is a sounder and sounder proposition. Although the death rates now seem to rise a thousandfold from age 10 (0.0005) to 110 (0.5000), the invention of life insurance in its 21⁄2 centuries of operation has aided men in self-sufficient dealing with that increasing risk by level-premium life insurance, wisely offering the choice of paid-up protection from prior thrift. The improvement in mortality and in life insurance rates works in reverse in connection with annuities, but self-sufficiency takes both provisions in its stride. That orderliness of death rates is somewhat less satisfactory in permanent total disability rates. It has sometimes seemed that keeping damaged lives alive might increase PTD rates. I have observed one experience with PTD rates, where after 13 years with an experience of 20 percent of the expected claims, the rate became 200 percent only a few years later. But when we come to a whole set of various medical expenses on the older people, although the records have been greatly developed in recent years, they still need much more interpretation to make them in any sense comparable with the mortality rates. Looking backward at the prognostications among Government-handled projections under the more orderly risks suggest to me that the hope that dependable measurements can be made of the benefits to be paid by passing the bill over to the younger taxpayers may be "pious and humanitarian," but hardly "actuarial." Were these medical care outlays to result in only a 10 percent increase in OASI benefit-payment yet to follow in 1962 by a 10-percent increase after the 4-percent tax increase of 1961, that yearly boost is too much. (I do assume that a second boost of near-gratuities to the present-1961-aged will not be seriously considered.) We have been given fair warning of persistent intent to keep on raising the OASI benefits. As our attention flags, they will ap parently be presented. Let me restate, baldly: OASI taxes have, in the 24th year, reached 22 times the taxes of the first year. OASI benefits in the 24th year are 11,000 times the benefits of the first year. For the last 10 years the average yearly increase in benefits has been a billion dollars. The personal OASI tax has risen from $9 to $80. This leaves out the disability picture. Compulsory charity The program has been built by the illusion that personal budgeting has failed and will fail; that the local community is unable to manage its relief budget; that the sovereign state must pass over its constitutional prerogatives to the |