The expansion of the Hospital Survey and Construction Act as proposed in S. 2758 has not been officially considered by our association but it is safe to assume from informal expressions by various members that there is overwhelming, perhaps unanimous, support for the proposed amendments.

The specific earmarking of funds for the several categories of facilities will stimulate sponsorship of projects in these special fields which otherwise would never develop. For example, most States have been reluctant to approve projects for chronic-disease facilities under the present law because the need for general hospital beds has been considered more pressing from the emergency nature of such facilities. Since the allotments to the States have been minimal compared with the overall need for all types of facilities, the States allocated such funds to the projects having the greatest relative need. The amendments as proposed in S. 2758 will substantially solve the need for a more equitable distribution of funds to the several categories by:

1. Allowing the States to continue the approval of general hosiptal beds (under the existing law) in the areas having the highest priorities, since the amount of the Federal allotment will not reach communities with needs average or better.

2. Permitting the States to encourage the establishment of cronic-disease projects where financing new construction has been the major obstacle and the continued need for general hospital beds a first concern.

3. Allowing the States to review the present State hospital plans to plan for diagnostic and treatment centers and nursing homes in areas where the costly duplication of small hospitals would be the only alternative.

4. Enabling many communities to establish central rehabilitation facilities for the general use of patients from small hospitals and nursing homes as well as for the many disabled persons not in institutions.

5. Encouraging the construction of nursing homes in areas having the most critical shortages, thereby reducing the number of substandard facilities which are allowed to exist because of the need and the lack of more adequate facilities. The only suggestion for your consideration might be that the amount of the authorization for nursing homes be increased to $20 million and the amount for chronic-disease facilities decreased to $10 million. Our experience has led us to believe that there is much more interest and demand for the nursing home type of facility for the care of the chronically ill. Governing boards of general hospitals and hospital administrators are not yet sufficiently convinced that a chronicdisease unit as a part of the general hospital is the best answer to this complex problem. Many feel that good nursing homes either owned by, or at least affiliated with, general hospitals may be a better solution to this problem for the maiority of today's general hospitals, particularly hospitals located in intermediate and rural areas.

The high-cost per-patient day in a chronic-disease unit of a general hospital would greatly limit the number of chronically ill patients who could stay a sufficient length of time to benefit from such services. There definitely is a need for a limited number of such units in the more densely populated service areas, but the real need lies in an immediate increase in the number of nursing homes in the areas having the greatest shortage.

In behalf of the Association of Hospital Planning Agencies, I want to express our appreciation for this opportunity to present these comments to your committee for its consideration of bill S. 2758.

Respectfully submitted.

VINCENT F. OTIS, President.

Senator HILL. The committee will stand in recess until Monday, March the 29th, when testimony will be received on Senate bill 2778, which embodies the President's recommendations concerning public health grants-in-aid formulas.

(The following statements were later submitted for the record :)

STATEMENT BY MINNIE HOOD HOPKINS, VICE PRESIDENT, NATIONAL ASSOCIATION OF REGISTERED NURSING HOMES, INC., AND THE FIRST VIRGINIA NURSING HOME ASSOCIATION, INC.

My name is Minnie Hood Hopkins. I am vice president of the National Association of Registered Nursing Homes, Inc., and also vice president of the First Virginia Nursing Home Association, Inc. Both of these associations are composed of owners and operators of proprietary nursing homes and we feel that,

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as proprietary nursing home operators, if this bill is enacted and through public grants to nonprofit organizations, they are permitted to expand their facilities, we, as independent operators, will be deprived of an inborn American right of free enterprise to expand our own facilities, thus depriving us of the right to better meet the needs of our communities as has been pointed out so eloquently in other statements submitted by members of our association and allied associations of our profession.

In view of the part that the proprietary nursing home has played in the past and is anxious to play in the future in meeting the needs of the long-term-care patient, we believe that should this bill be considered favorably by your honorable body, for the protection and welfare of our Nation and for the protection and welfare of the proprietary nursing homes that there should be included under section 623A of the Hill-Burton Act and under the appropriate section of the present S. 2758 an amendment providing for the designated State agency for the administration of the plan to include in its body a representative of the proprietary nursing home. The agency of the State either in existence at the present time or to be created will have the opportunity of drawing upon the experience of our association and our members who are cognizant of the need of each community and will have the opportunity of knowing when the need of a newly created nursing home facility if apparent or real, or whether such application made by a nonprofit group would be in competition with existing facilities.

It is an established fact that people who have their own money invested, take a personal interest in the patients in their homes and work harder to make these nursing homes a success, we feel that because they have their money and years of their lives invested in their establishments, the proprietary nursing home operator will give their time to this agency to protect their interest and the interest of their patients.

It has been brought out in testimony before that in recent years so many years have been added to the life span of man, we, proprietary nursing home operators like to think that through our personal care in private proprietary homes, we are also adding living to these years. We would like to be allowed to continue to do so.

STATEMENT BY HARI EKLUND, PRESIDENT, NEW YORK STATE NURSING HOME ASSOCIATION, INC.

My name is Hari Eklund. I reside at 25 Ridgeview Avenue, White Plains, N. Y., where for nearly a quarter of a century, I have served as owner and administrator of "Resthaven," an accredited nursing home-an internationally known and patronized proprietary medical care facility.

As president of the New York State Nursing Home Association, Inc.-a nonprofit membership organization designed to enhance the welfare of the aged and infirm through nursing home operational standards and ethics-I represent approximately 400 proprietary nursing homes or similar institutions.

As concerning Senate bill 2758, or any similar proposed national legislation the New York State Nursing Home Association supports the position officially adopted by the National Association of Registered Nursing Homes, Inc., to which we are affiliated both by membership agreement and by cooperative procedures.

I deeply appreciate the courtesy extended to our association by this esteemed and most respected committee to add our testimony concerning the proposed legislation.

We are seriously concerned with two major premises. One-the welfare of the national economy, and the nondisruption of progress of the existing proprietary nursing homes and similar institutions.

The total proprietary nursing home investment for plant and equipment in New York State approximates $60 million. Conservative estimates indicate that the annual payroll for these institutions is $25 million, which on a 15-percent basis represents a Federal payroll withholding tax of $2,750,000.

Such items when considered on a national scale clearly indicates that we are dealing here with a multi-billion-dollar industry or profession. Any influence that tends to disrupt the growth and development of this important private initiative segment of our population, in equal ratio, tends to weaken the industrial structure of the entire Nation.

Gigantic forces are abroad today in the whole world which strives for the ascendency of one or the other ways of life. Our Nation is dedicated to the

democratic principle of self-determination and private initiative and enterprise wherein the spirit of man only may find freedom. Any legislation affecting the basic freedoms of our people warrants careful consideration indeed.

Our association is willing to support legislation similar to S. 2758 provided that in the subsequent surveys and in the determinations affecting need and eligibility, representation be extended to include nursing homes and similar institutions utilizing nonprofit nursing home association's appointed advisory committees or similar equitable representation.

STATEMENT BY JAMES M. ROSEN, M. D. PRESIDENT, NEW YORK CITY NURSING HOME ASSOCIATION, INC.

The National Association of Registered Nursing Homes is the oldest organization of its kind in the United States. It is a nonprofit association composed of nursing and convalescent home owners and operators, pledged to high standards of nursing care and to a high code of ethics. The officers, all of whom own or operate one or more institutions, serve the association without compensation. Our members have many years experience and are well qualified both by education and service to speak on the problems of caring for the aged, convalescent, infirm and chronic patient.

It is the opinion of all the members of the association that no group truly interested in the care of the sick, could possibly oppose a bill which is intended to enhance any program of medical and nursing care. It is obvious, therefore, that we favor the intent of H. R. 7341, the amended H. R. 8149, and the companion bill S. 2758. However, we respectfully submit that the provisions of this pending legislation as written present a serious omission in their complete disregard of the proprietary nursing home.

Our thinking and concern regarding the failure to include the proprietary nursing home in planning for extension of the National Health Program is dictated by three general considerations, namely:

1. What is best for the patient?

2. What is fair and reasonable for the proprietary nursing homes?

3. What is of the greatest benefit to the Government in planning the program? Regarding the first point, "What is best for the patient?" we do not believe that the above-mentioned omission serves the patient's best interests. The patient, himself, is the basic and primary factor in the consideration of a health program. He must be provided with sufficient and adequate facilities to meet his needs. In order to properly measure his needs, the patient must be described carefully. It is generally agreed that no clear, commonly accepted definition of the nursing home type of patient exists. Such a patient is loosely referred to as chronic, convalescent, infirm, disabled, aged, and long-term care. The degree of deviation of this group from the so-called acutely ill patient has a wide range, and is determined in great measure by who may be doing the classifying, where such classification is being made, and the purpose of such classification. Medical, administrative and economic considerations dictate an overall description of a patient suitable for nursing home care as being one who, regardless of age, has had complete diagnostic study, a full measure of curative therapy and every advantage of rehabilitation efforts. Except for the convalescent patient, who is defined as a person recovering from an acute illness and expected to regain his former health status, his prognosis for recovery or improvement is scientifically determined to be nil. His medical requirements are finally adjudged to be occasional medical supervision, palliative treatment, and varying amounts of professional and nonprofessional nursing skills. One no longer employs the term "incurable" for this unfortunate patient. But incurable he is, a burden to the community, to his family and to himself. His expected life span may be weeks or it may be years.

The question naturally follows: How can we best care for this unfortunate human? He, obviously, more than anything else, requires a permanent placement. Such placement, experts in the field agree, should be in surroundings which simulate home as nearly as possible. These homes should be noninstitutional in size, architecture, furnishings, decoration and atmosphere; they should provide unobstrusive professional nursing supervision, and aid in dressing, feeding, bathing, walking and personal needs. Above all, they should provide the intimate personal contacts so necessary to the helpless. The homes should be so located that they will be readily accessible to relatives, friends and churches.

These are the things that the proprietary nursing homes represent. Theseare the very advantages that they offer, in contrast to the cold, impersonal, large, institutional facilities of many governmental and nonprofit agencies.

The nursing home owner and proprietor is a community-minded individual with an innate sympathy for the disabled, aged, and helpless. He enrolls in this segment of the medical care team as a matter of choice, and invests his own capital and hard work to back his interest and choice.

From the patient's point of view, it is imperative that he be given every opporunity to retain every possible vestige of dignity and self-respect in his remaining years. In many areas, under present procedure, in proprietary nursing homes, the public asistance recipient is paid his allotment for room and board directly. He in turn, pays the nursing home for the care received. Placement of publicassistance recipients in governmental institutions and in many nonprofit institutions eliminates this direct payment plan. It also takes from the patient the right to chocse for himself a place of permanent residence. This in a measure is a revision to the outmoded concept of the almshouse and poorhouse. Regarding our second point, "What is fair and reasonable for the proprietary nursing homes?", the proprietary nursing homes pioneered in the field of nursing home care, and led the way out of the dark ages of institutionalized neglect of the chronically ill, infirm, and aged. Private enterprise, as so generally the case, led the way. Unfortunately, it is not generally known that most of the proprietary nursing homes did not, and do not, limit their admission to those able to pay high rates. They admit a great many public-assistance cases at very low

rates.

In New York City, for example, the proprietary nursing homes care for some1,500 "welfare patients," at rates as low as $130 per month, and have recently made available an additional 700 to 80 beds to the hospital and welfare departments. This is true of the nursing homes throughout New York State. In some areas of the Nation, the rates are even lower for the so-called indigent case. Many of these patients are incontinent, bedridden, and totally helpless. They have been overcrowding the facilities of general hospitals, occupying the beds badly needed for the acutely ill. The average cost of care in the general hospital is about $18 per day, or almost $550 per month. In spite of this fact in spite of the substantial savings made possible in the proprietary nursing homes, it is these very nursing homes which are ignored and omitted in legislation which purports to expand the health program of the Nation.

Bill S. 2758 proposes aid for the public and nonprofit agencies but not for the proprietary group. Nonprofit agencies admit patients who are able to pay their way, those who pay their way partially, and those who require total assistance from public and private agencies. In return for the designation of “nonprofit", these agencies are given the benefit of tax exemptions, the right to go to the community for soliciting of funds, and of course, a sizable sum of money from tax funds.

Just as the nonprofit institutions, we, the proprietary nursing homes in this country, admit people who are able to pay their way, people who can only partially pay their way, and people for whom private and governmental agencies have assumed responsibility. The unhappy difference is that we have no tax exemptions, no right of fund solicitation, and no recourse to tax funds in charitab'e institution budgets.

Ours is a very, very difficult role. We are a recognized member of the medical care team in the total medical care program, locally, statewide and nationally, yet for some reason, which we believe is purely an oversight, no mention is made in S. 2758 of the proprietary nursing home. If enacted into law in its present form, this bill will result in the closing of the great majority of proprietary nursing homes.

The nonprofit institution is not precluded from admitting patients who are able to pay, and additional funds will be made available to it for expansion and construction of facilities for the admission of the semi-indigent and indigent patient. Since the indigent patient has no choice in the matter, routine placement in the nonprofit institution will be the inevitable result. Thousands of beds geared to the indigent patient will remain vacant in the proprietary institutions.

In terms of dollars and cents, the proprietary nursing homes represent a nationwide investment of approximately $1.5 billion, more than $10 million in New York City, and about $60 million in New York State. It is estimated that there are 500,000 beds in proprietary nursing homes in the United States. There are 4,000 beds in New York City, and 25,000 beds in New York State. The proprietary nursing homes employ about 170,000 persons. New York City homes

employ about 2,000 and New York State 8,500. The national payroll for employees is close to $8 million weekly. The payroll in New York City is about $100,000 a week and in New York State $425,000 a week. These are impressive facts. The proprietary nursing homes represent a sizable industry in the American economy. Any legislation, therefore, that may eliminate this segment of the economic structure must be most carefully considered.

The people who own and operate proprietary nursing homes bring to their chosen work a great many years of experience in a highly specialized field. They also offer a direct personal interest in each patient's welfare. Bluntly put, nursing home proprietors' failure or success in making their living, and the degree of their success, depend totally on the degree to which they possess this interest and concern. Persons who administer the nonprofit institutions may have the same training and experience to offer. They do not and cannot have the same stimulus for personal concern and interest in the patient.

We wish to stress one final point in our consideration of what is fair and reasonable in considering this legislation in relation to the proprietary nursing homes. It seems to us that in the exclusion of our agency from the benefits of this legislation, we are asked to face a type of unfair competition which is completely foreign to the basic principle of "free enterprise and private initiative" so frequently and so ably expressed by our executive and legislative leaders. Regarding our third point, "What is of greatest benefit to the Government in planning this program?", we submit that in all program planning it is axiomatic that existing agencies and facilities be utilized. This constitutes sound reasoning, The experience and the structure is there. Much time and expense can be saved, and there is much to be gained by making use of the existing proprietary nursing home.

In testimony before the Committee on Interstate and Foreign Commerce, in the House of Representatives, it was stated that the per-bed construction cost in the Government planned nursing homes would be $8,000. As we have already pointed out in our statistics on investments, private interprise is presently supplying the same facilities at a cost of less than $4,000 per bed.

Careful thought and consideration should be given to any group, be they designated "proprietary" or "nonprofit," which can produce for governmental use equivalent facilities at less than half the cost as shown in the Government survey. From these facts that we have quoted, we believe that should this bill be considered favorably by your honorable body, for the protection and welfare of our Nation and for the protection and welfare of the proprietary nursing homes that there should be included under section 623A of the Hill-Burton Act and under the appropriate section of the present S-2758 an amendment providing for the designated State agency for the administration of the plan to include in its body a representative of the proprietary nursing home. The agency of the State either in existence at the present time or to be created will have the opportunity of drawing upon the experience of our associations and our members who are cognizant of the need of each community and will have the opportunity of knowing when the need of a newly created nursing home facility is apparent or real, or whether such application made by a nonprofit group would be in competition with existing facilities.

We again wish to emphasize that the disruption of a profession of the size indicated above can not help but result in both individual and corporate tax losses to the Government and can not be disregarded.

STATEMENT OF ZUZIE SIEGAL, PRESIDENT, NATIONAL ASSOCIATION OF REGISTERED NURSING HOMES, INC.

The National Association of Registered Nursing Homes, Inc., is the oldest organization of its kind in the United States. It is a nonprofit association composed of nursing and convalescent homeowners and operators, pledged to high standards of nursing care and to a high code of ethics. The officers, all of whom own or operate one or more institutions, serve the association without compensation. Our members have many years experience and are well qualified both by education and service to speak on the problems of caring for the aged, convalescent, infirm, and chronic patient.

It is the opinion of all the members of the association that no group truly interested in the care of the sick, could possibly oppose a bill which is intended to enhance any program of medical and nursing care. It is obvious,