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senior official in the Ministry of Health in Moscow. One day the Russian said, "I wish we could figure some way to get the doctors to go to Siberia."

Watt said, "Now look, you mean you can't send doctors to Siberia?" The Russian replied, "Of course we can send them. I could send a hundred of our brightest young medical graduates to Siberia. But then there would be a hundred of them out there figuring out how to get back to Moscow, and there is only one of me."

Mr. ROSTENKOWSKI. Well, Dr. Freymann, what do you envision the hospital of the future to look like if the trend continues as you have outlined it in your statement?

Dr. FREYMANN. I have written a whole book on the subject. (The American Health Care System: Its Genesis and Trajectory. Medcom Press, New York, 1974, 406 pp.) It took me 8 years to write, so I won't try to give you a full description, but I will try to boil down my view of the hospital of the future.

When we think of hospitals today, we still think of a big box full of all kinds of advanced technology where all the patients are horizontal, and where we treat acute crises in the course of chronic diseases. When these crises abate, we send the patients out pretty much on their own devices.

Returning to my theme that we should build on what we have nowthe hospitals are there. We can't get rid of them. What we can do is change the vision of what a hospital is. I think we can do this through financing and through education. The center of technology where we take care of these crisis will continue to be an important component, but the main function of the hospital of the future will be comprehensive care (including preventive care) of a population which depends on that institution.

I want to make very clear that when I am describing this hospital of the future I am not talking about hospitals employing physicians. There are already some places where that arrangement works quite well. The Hunterdon Medical Center in New Jersey is an example. But I think we can use any variety of payment and organizational mechanisms. The key feature of my vision is a functional grouping of all types of health professionals about an institution which would still be called a hospital but would have a far broader role in total health care than the hospitals of today.


Mr. CORMAN. Thank you, Mr. Chairman.

I was going to suggest that either now or if you submit comments on the Brock-Martin bill which is the catastrophic approach; if you address this problem of cost control, it would be fine. I am not sure it is in Ribicoff's bill, but it seems to me logical if you put in catastrophic illness insurance in any form without cost control that we will see a ballooning of certain kinds of care. If I were a normal doctor and I had no cost controls on me and the patient is supposed to cover 15 percent of it, I think I would figure out how to live on 85 percent just in case I couldn't get the 15 because I know the Government will pay the bill. I would like comments on that.

Dr. FREYMANN. Mr. Corman, I agree with you. But I think catastrophic illness insurance would skew the system even more than it already is toward acute crisis care. The problem with catastrophic

coverage is not so much what it would do as what it won't do. That is, it will drain more and more of that "bottom-line figure" we keep talking about into that portion of the health care spectrum which has the least payoff in terms of a healthy population-the treatment of acute crises in the course of chronic diseases. Less and less of the bottom line figure will be available for primary care and the preventive measures.

Mr. FEIN. I would agree with you also, Congressman Corman. All of us sitting here are speaking about health care today. Obviously, we have as taxpayers, as citizens, many other interests. It would be irresponsible to legislate a mechanism that will involve an escalation of costs both because of the kinds of things that are covered or the kinds of fees that would be charged and where you would have a price inflation that would use up valuable resources, leaving us less able to meet the other needs of society. To legislate a blank check is a most dangerous procedure. At least if you pick up a blank check that I signed, you have to consider what is a sensible amount to fill in since I don't have unlimited resources. You might put down $50, figuring that the check won't bounce. Maybe you're a risk taker and you put down a hundred. But you won't go very high. But if a blank check is signed by Uncle Sam, you can put down any number and the check will be cashed. For the Congress to legislate a blank check to the American medical profession would be irresponsible to all the other social needs of the country and the approach which does not have cost control in it is, as we have found with other legislation in the past, a blank check.

Mr. CORMAN. Do any of you have any suggestions for a form for delivery of health care that would upgrade what we do for preventive care other than HMO's?

As I understand it, the primary incentive in HMO's is the economic. You keep the people well, and you will get the same income so you have an economic incentive to keep them well.

Is there anything other than that that would work to this end? Dr. WYNDER. Dr. Freymann thinks perhaps more of how young medical students could be modified in terms of good health education than I do. As it now stands the majority of the American young physicians living in the present environment will end up in therapeutic care. Therefore, I feel that we have no choice but to better utilize allied health professions. They can do the job better at a lower cost to society than most physicians who perhaps are overtrained for this aspect of medical care.

The allied health professionals are not properly utilized in our society. In our hospitals the nurses are not utilized to their full potential. It has been my experience if you take nurses and challenge them with a position that relates to taking care of patients as for instance hypertensive therapy under a physician's guidance, nutritional advice, or any other behavioral aspects of medical care they do very well.

My key suggestion, cost-wise and indeed in terms of the way we deliver services, would be increased utilization of allied health professionals.

Mr. CORMAN. Are you suggesting that the Federal Government get into the business of deciding according to licensing who can deliver what kind of care?

Dr. WYNDER. This is a possibility. At present laws vary from State to State. There are some States where allied health professionals are utilized very well and there are other States where they are under utilized. In part this utilization seems to depend on the number of physicians in a given State.

To answer you specifically yes, you could very much help in raising the utilization of allied health professionals in our country.

Mr. CORMAN. Did you want to add to that, Dr. Freymann?

Dr. FREYMANN. I would like to throw one of Dr. Wynder's quotes back out, actually the quote of Martin Luther about giving me your child at five. I would like to emphasize, more effective than having physicians or allied health professionals giving health education is to get it into the school system.

Mr. REINHARDT. Yes, right.

Dr. WYNDER. Yes.

Dr. FREYMANN. It is often said we don't have a health education program in this country. On the contrary, we do. It is on television.

In the course of a week, a single station in Detroit carried over nine hours of health-related information. In the judgment of those monitoring it, 70 percent of this was inaccurate or misleading or both.

I don't need to tell you what kind of health education we see on television. It is dedicated primarily to whether you smell good or whether you look good. But it is education related to health.

Health education is beyond the purview of a National Insurance Program, but I think it is an important part of National Health Policy. We must develop effective ways to get to our children and teach them good health practices. The drug education programs now offered in our schools are examples of how not to teach good health practices. They are all negative. All the children hear is how bad everything is. Good education should be positive. It should be directed toward why they should do things, not why they shouldn't.

Dr. WYNDER. Here is another area where you could help. I go along with Dr. Freymann, health education on TV can play a role but we should not limit it to public service television.

I like to believe-because most kids in most areas don't watch public service television. They watch commercial television. I feel that commercial television particularly on Saturday morning has a duty to have some kind of meaningful health education programs for children who sit glued to the TV set.

These are public air waves. I think they ought to be used at least in part to educate our young and certainly I am in agreement with Dr. Frevmann that this is where the action lies.

Mr. CORMAN. There is a legislative proposal before the Congress that Leonard Woodcock refers to as the Health Security Program. It's a broad-based program. If you are familiar with it do you have any comments about it?

Mr. FEIN. I am quite familiar with it. I would comment favorably. It addresses the financing aspects. While I might have reservations about what I would consider details, it does so in an effective manner.

Americans would have access, would not have the economic barriers that many face now in seeking care.

It also addresses the supply considerations. It has a bottom line to it. It puts the money back where people can argue about what it ought

to go for at the local area. In other words, it uses a central financing mechanism while permitting a great diversity in the delivery systems.

It is a big country and it is a different country and we need that diversity in delivery system. If some people want to opt for HMO's, they can do so, but they don't have to do so.

In the present system by contrast, with multiple sources of funds it makes it difficult to organize different kinds of delivery systems. It is tough to start a HMÖ because it is thought to enroll a medicare population because they are covered by one program, a medicaid population, because we have to go to the Governor to get a contract for that population, and so on. So I have no difficulty with the central budgeting device leading to diversity with the equal access to care and with the supply considerations.

Of the various measures that are before the Congress I would find that the most appealing. In line with my earlier remarks, if one were forced for a variety of political reasons to phase in a program, I would' like to have the Corman-Kennedy bill out there as what I am moving toward over a period of time in a manner that will actually get me there.

I would conclude with one additional point. While all of us, and you, have been talking about the complexities of the system and the difficulties and the interrelationships and the central city and the preventive care, I would not want the tone of our remarks to color all of our judgment as we leave this room.

I would remind us that; yes, it is a very complex business but I would also remind us that it is not all that tough to write a good bill' on the equity side dealing with financial protection. Other countries have done it.

What is tough is that we are trying to write or talk about a bill that would change the system as well. That's very complex. But the Canadians without any great trauma, and they are not much brighter than we are, have a program and it is not that tough to write a good bill. It may be tough to get the votes for it, but it is not that tough to write a good bill on the financial protection side.

Other countries have done it. We have the benefit of their mistakes and of their good points but that, gentlemen, we can do. It is when we can bring in the system that life does get more complex. It is in that regard that I feel we ought to give this high priority to the access for care, the Kennedy-Corman bill does just that.

Mr. CORMAN. Any other comments from the panelists whether you are familiar with it or not?

Professor Fein very accurately stated what it does, in any event. Mr. REINHARDT. Yes: I think if one contrasts that kind of bill broadly with the catastrophic risk bill, I also would opt for the former, primarily because it does the catastrophic-risk bills really do not address the one goal that I posited earlier. That goal is to free the American citizen from anxiety which is, I feel, totally unnecessary. At the minimum every American citizen should have a very concise idea of what the maximum potential financial loss due to illness is, if only so that he or she can plan for it.

Second, I would recommend that the maximum risk should be rather low. I think one talks here really of percentages related to income and not just of some absolute amount.

Dr. Fein would have zero as an optimum percentage. I would be willing to go above that but certainly not to 15 percent. This is a matter, a s you said, which one can negotiate.

Health insurance legislation ought not be that difficult to write. The difficult part does come as-Rashi Fein has observed-in trying to obtain the goals of health insurance in a cost-effective manner. The problem is to identify the cost effective system and to devise measures likely to goad the health-care sector toward that optimum.

Legislation declaring that a maximum of "x" residents can specialize in surgery would have a very blunt impact on a the health care system, as would, for example, a command to a certain doctor to practice in Kansas, quotas, and certificates of needs for physicians.

I think such direct regulations would be appropriate only if one knew what the optimal organization of medical facilities in this country would be. Unfortunately, we do not know precisely what an optimum system would look like. Therefore direct regulations can be counter productive.

On the other hand, one does not necessarily have to give up attempts to modify the existing system. You can use the physical flows that accompany the delivery of health care in this country. Under National Health Insurance the public sector will gain control over these flows, and it could use them as policy levers.

It does seem to me, for example, that in the design of the fee schedules under NHI, there lies an opportunity to change the health care system at the margin in gentle ways that do not strike as bluntly as direct regulation would.

Finally, I believe that there is one measure whose impact might be blunt and yet benign, and that is to remove certain artificial legal restrictions on innovation in the health care sector that have strangled that sector for so many years. I said this morning that licensure in some way has amounted to granting a monopoly to one particular profession. I reiterate that. This method of licensure is not necessarily optimal from society's viewpoint, I would like to see a much more díverse set of entry points into our health care system. I would like to see, for example, legislation establishing independent paramedical practitioners. But clearly that is something you can consider independently from a National Health Insurance bill. Indeed, I would not wish to see you couple it with a National Health Insurance bill. It is merely something you ought to keep in mind.

Mr. CORMAN. We have done precisely in that proposal what you have laid out. We did avoid that latter point for very sound reasons.

Dr. FREYMANN. I am not familiar with all the details of your bill, Mr. Corman, but agree that given the choice between that approach and the catastrophic approach, there is no question in my mind which is preferable, namely, the Kennedy-Corman bill.

I agree with my colleague that National Health Insurance would indeed free the public from financial fear, but I would like to make an appeal. I address it not to you but to the Congress as a whole. Please avoid the implication that there is a connection between National Health Insurance and saving money on health care. I know of no evidence that any health insurance system has saved money.

I would like to point out that we have been here all day discussing purchase of a product, but we have not defined what that product is.

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