appeared for the society, forwarded a copy of the full study to us. In the course of his conversation, he indicated that the material he submitted did not indicate the number of people who may have been in need of hospitalization but who did not receive service. The statistics submitted in his testimony, therefore, are not really addressed to the need for further governmental action but rather comprise mainly a record of how hospital bills were paid. In the testimony presented by Dr. LaMotte there is no indication of the size of the population to which the percentage figures apply. This figure was secured from him by telephone, and on the basis of national hospitalization rates for those 65 and over, it would appear that the number of hospitalizations in this age group in Delaware was significantly lower than the national figure. This, of course, could be accidental or could be quite significant. In the conclusions from the full study several cautions are offered which were not included in Dr. LaMotte's testimony. They are quoted here:

"Special attention by responsible health and welfare authorities should be given to the study findings of the low admission rates for old-age assistance recipients and nonwhites. This data is especially significant when it is recognized that the health of nonwhites, as a group, does not compare favorably with the health of the white population. The reasons for these low admission rates should be thoroughly explored ***”

"This study did not determine to what extent the economic resources of private aged patients or their children may have been exhausted by the cost of hospitalization. Considering the longer hospital stays for aged persons, there is a very real possibility that some proportion of private aged patients could be regarded as medically indigent."

The publicity in the newspaper concerning the Delaware Medical Society testimony seemed to indicate that there was no need for further action in Delaware. The full study does not conclude this. Delaware is one of the few States which do not have in operation vendor payments for medical care under old-age assistance.

The testimony of the Texas Medical Association was also examined. This is another State which does not have an operating vendor payment medical care plan for old-age assistance and in which no action on medical assistance for the aged is anticipated in 1961. The statistical information in the testimony by Dr. Harvey Renger for the Texas association lists the sources of income for persons over 65 without indicating either duplications or the level of these resources. In his testimony, Dr. Renger also asserts that "advocates of social security *** claim that the average cost of an illness to the elderly is $1,000.” He attempts to deny this by citing a survey of patients discharged from one hospital in Fort Worth whose average hospital bill was $384 and physician charges averaged $115. We do not know where the alleged $1,000 figure came from and it is fair to indicate that a survey from one hospital is hardly conclusive. There is another interesting set of figures in the Texas association's report. They indicate that doctors work on an average of 61 hours a week and give 7 hours (12.6 percent) of their time to patients who are unable to pay they cite the publication, New Medical Materia, which indicates: "Texas physicians donated services worth more than $31 million to their patients in 1960." On the basis of a 1959 survey, the publication Medical Economics shows the income of Texas general practitioners to average $17,500 a year and specialists $24,700. From Dr. Renger's presentation and the data in these two medical publications, one would have to conclude either that doctors' income in Texas averages $34,300 annually or the $31 million free care is actually about $19 million. In either event, the figures must be highly suspect. We have written to Medical Materia for some explanation of the way in which the statistics showing free care given by physicians were developed, but we have not yet had a reply. Attached is a copy of our letter.

There has also been an opportunity to examine the statement submitted by Dr. Otto K. Engelke on behalf of the Michigan State Medical Society. Dr. Engelke says:

"Initial experience has demonstrated that nine-tenths of our over-65 citizens either do not require medical service or they are in a substantial financial position and can meet medical service costs through a private contract, or through the legal obligation of some other Government agency. For example, over 50 percent of the families over age 65 have some form of health insurance, and this percentage is increasing rapidly."

Dr. Engelke was contacted by phone and a letter was sent to him asking for some indication of how the figures cited in this portion of the presentation were

arrived at. A copy of this letter is attached. Following up on this letter, we called Dr. Engelke. He indicates that the letter will be called to the attention of the council of the Michigan State Medical Society when it meets late in September. He was unwilling to elaborate or explain the statistics contained in the statement to us. He suggests that if the Ways and Means Committee wanted further information, they might request it directly of him.

There has been a recent fairly comprehensive study of medical economics in Michigan in response to a special request from a commission appointed by the Governor. The study, costing $382,000, and financed by the Kellogg Foundation was conducted by the University of Michigan, As cited in Mr. Reuther's testimony, this study shows that 42 percent of Michigan's population over age 65 has some kind of health insurance. The study also characterizes this health insurance as being far less adequate than that for other age groups and recognizes that a serious problem exists in this area. Dr. Engelke's abovequoted statement is completely inconsistent with this study. When this was brought to Dr. Engelke's attention, he said that he was not aware of the discrepancy between his statement and the study prepared at the same campus where he is a professor of preventive medicine. He indicated that it was his impression that the highly publicized study showed only national and not State figures.

There is a whole series of misleading statements in the testimony of the American Medical Association. Here are two examples: The AMA report makes a substantial point of the fact that the net worth of OASDI recipients increased from $5,610 in 1951 to $9,616 in 1957 and that the upward trend continues. It also cites the information that in 1958 "over 70 percent of aged OASDI beneficiary couples owned their own homes, 87 percent mortgage-free." This data is used to argue that "many of the aged are in reasonably good shape economically."

A reasonable appraisal of the resources of OASI aged beneficiaries is given by Mortimer Speigleman in a book published for the Pension Research Council of the Wharton School. He shows that the median worth for aged married couples was $8,786 in 1957-far lower for single retirees and aged widows. Median liquid assets for these categories varied between $37 and $1,271; the equity in a nonfarm home ran between $5,458 and $8,100; face value of life insurance was below $1,900 for all of these classes. Such resources are modest as related to the possible expenses of a serious illness. The suggestion implicit in the AMA's testimony, that this constitutes resources that can be set off against medical care, is not acceptable. It makes no social or economic sense to consider this limited real and personal property as a suitable source from which unpredictable medical care costs should be paid.

One of the AMA's most misleading assertions appears on page 74 of the testimony. It relates to the performance of voluntary health insurance. It is quoted here:

"Nonetheless, the data suggest that a possible 65 to 70 percent of the beneficiary couples who did use the hospital could have obtained aid in paying the cost. This performance of voluntary health insurance is extremely good."

The assertion that 65 to 70 percent of the beneficiary couples could have obtained aid is not only admittedly conjectural in magnitude, but also deliberately misleading in meaning. It is entirely insufficient to assert that the beneficiaries could have obtained some aid, however trivial that aid would have been. blankets under a single category a multitude of inadequate insurance. AMA editorializes: "This performance of voluntary health insurance is extremely good." We come to a contrary conclusion.

This
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The testimony of the Secretary of the Department of Health, Education, and Welfare, and the comprehensive report submitted by him to the committee were also carefully examined and the data in them was compared with figures from other sources, such as reports of the Health Insurance Council, the Health Information Foundation, and other agencies outside Government. The Department's material stood up well to this test. They have used outside sources for much of the material. Their statistics are internally consistent and we are convinced that these data have real validity. Their actuarial evaluation of costs appears to be conservative and carefully worked out.

JAMES BRINDLE, Director, UAW Social Security Department.

AUGUST 8, 1961. OTTO K. ENGELKE, M.D., President-elect, Michigan State Medical Society, Washtenaw County Health Department, Ann Arbor, Mich.

DEAR DOCTOR ENGELKE: In accordance with our phone conversation this morning I am, as you requested, putting in writing my questions on the statement of the Michigan State Medical Society before the Ways and Means Committee last week. As I indicated to you this morning, we have been asked to evaluate the statement of the Michigan State Medical Society and would like to identify the sources of several statements in your presentation.

In your statement you indicated: "Initial experience has demonstrated that nine-tenths of our over-65 citizens either do not require medical service or they are in a substantial financial position and can meet medical service costs through a private contract, or through the legal obligation of some other government agency." Since we have seem no statistical evaluations which would justify such a conclusion, could you please identify the source for this statement. If there is no published course, or, if this is an estimate, could you please indicate who made the estimate and the basis for the estimate. Similarly, your statement said: "For example, over 50 percent of the families over age 65 have some form of health insurance, and this percentage is increasing rapidly." Again we would like to have identified the source of this estimate since it ap pears to be at substantial variance with published data as is available on the extent of insurance among Michigan's over-65 population.

We would very much appreciate your providing us the documentation for these assertions before the House Ways and Means Committee. Sincerely yours,

MARTIN A. COHEN,

Program Consultant, Social Security Department, UAW.

Mr. DAN KUSHNER.

AUGUST 9, 1961.

Executive Editor, New Medical Materia, New York, N.Y.

DEAR MR. KUSHNER: As you will recall from our recent telephone conversation, I am interested in learning more about the survey showing that U.S. physicians provided in excess of $650 million of free services in 1960, as reported in the May 1961 issue of New Medical Materia.

The amount of free care furnished by physicians has a rather direct impact on the question of medical care for the aged now under study by the House Ways and Means Committee. Since opponents of the Anderson-King bill have advanced the figure of $657 million of free care to minimize the need for the bill, it is a matter of some importance to be able to evaluate your survey from a technical and methodological standpoint. Because the text of the May article states only that the findings are based on a large nationwide sample, it would be most helpful if you could furnish us with the following additional information with respect to the survey:

(1) Please explain how the survey was conducted, whether by personal interviews, by mail, or otherwise.

(2) For each State, how many physicians were included in the sample? What percentage of the total number of practicing physicians does this represent? (3) Please explain the method by which the sample was selected.

(4) Of these physicians in the sample from whom information was requested how many replied?

(5) What was the largest number of interviews or replies received from physicians in any of the State samples? What was the smallest number? What percentage of the respective State's practicing physicians do these figures represent?

(6) Please explain the method used to derive a dollar value for the free services provided by the individual physicians included in the survey.

(7) What were the questions the respondents were asked to answer? (8) For each of the States and the District of Columbia and for the accumulative totals, please furnish the frequency distributions of the dollars of free medical care provided plotted against the number of doctors providing the care. I hope you will be able to provide us with this information at an early date. Very truly yours,

JACOB HURWITZ,

Consultant, Social Security Department.

Mr. KING. The committee will recess for approximately 10 minutes. (Whereupon the committee did recess for 10 minutes.) Chairman MILLS. The committee will please be in order.

Mr. ALGER. Mr. Reuther, I disagree with so much that you say yet I am going to try to be temperate, and I want you to help me. Mr. REUTHER. I will be glad to cooperate.

Mr. ALGER. Inasmuch as we met before on this forum, and I think both of us are going to be around for a while yet, I want to learn to understand your thinking better.

I would like to start out, rather than taking the time which I cannot begin to take to ask all of the questions I had in mind, to say that I have read at least twice all of your statements and I have listened as attentively as possible to your oral testimony.

I have a page on everything I want to ask you about, but rather than doing that by questions at this time, I want to start out by reading a dozen or so allusions that you made to the American Medical Association. While I have no brief for them or for any man, as a member of this committee, I think you were unfair, and let me tell you why I think so. These are the phrases you used, and I will give

you the exact quotes.

First, you said, "The doctors and insurance companies should stop ganging up on America's aged people." Second, "Thwart the clearly expressed will of the people"; "deliberate distortion"; "AMA puts pressure on"; "AMA support of the Kerr-Mills bill because it won't work"; "complete cynicism"; "outright dishonesty"; "deliberate mislabeling"; "distortions of the fact"; "dishonesty"; "fraudulent"; "slippery statistics and fear of social security"; "irrational."

Those are some of the things you said about them; and, so far as their testimony goes, I have been rather impressed by the fairness of their remarks, and I have a feeling that what you said about propaganda campaigns and the attacks made on you and Mr. Meany actually could be a smokescreen to cover up the fact that you are pretty well giving it to these fellows.

Do you care to comment any further? Do you not think you have been a little unfair in your zeal to present your side?

Mr. REUTHER. The sharpest criticism I made in my testimony with respect to the American Medical Association was essentially to quote what Dr. Fishbein

Mr. ALGER. Who is Dr. Fishbein ?

Mr. REUTHER. He now publishes a periodical called Medical World News. I do not know what his official position was, but he was one of the top persons in the American Medical Association. I think he was the editor of their Journal. He was certainly their recognized spokesman and, therefore, I say here that I merely quote what he

says.

Mr. ALGER. When did you take his quotations?

Mr. REUTHER. April 14, 1961-very recently.

Mr. ALGER. Do you realize that you are rather vulnerable when you say you do not know what his role is. Let me tell you, and I am a recent student of this. He has not been with the AMA since 1948. The statements you make are quoting a man 15 years after he was removed from his so-called position as spokesman, and I understand that the views that he expressed back then, while he had the right to,

Mr. ALGER. Anybody as able and as sharp as you are is going to get a lot of attention from us.

Mr. REUTHER. Flattery will get you nowhere.

Mr. ALGER. Nobody knows this better than I. I know what the labor leader's opinion is of me.

Then you say most Americans support this bill. I categorically denounce that statement because in my district I am convinced a majority do not. You call it a cynical conspiracy of opposition. I do not think that is so. Opposition does not mean it is a cynical conspiracy.

Then you say that nothing restricts the choice of physicians in this bill. I categorically say it does. You say that you do not want to impair the dignity of the medical profession. I say you have done more singlehandedly to do that than any witness thus far by the terms you have used. On page 5 of your statement you say that many thousands of doctors are for medical care under the social security system. I contest that figure but I cannot prove it at this moment. You are concerned for the aged as well as the younger people. Here I take issue with you. Here I think you are concerned only with the 14 million aged who will get something for nothing, not having paid in a penny on the program. Some of your other younger union people who do not have the good fortune of the aged will pay in as long as 45 years even as they have to support their own program if they do not get it through collective bargaining. I think we are giving a gratuity to 14 million and, asking your own younger working people to pay for it doubly. You are supporting those who did not pay. I think that double load on those not aged is one that will wean away some of your own supporters.

In any event, I take issue with you. I do not contest your concern for the aged in any regard. You say that the aged do not want charity. I think this is something I would like to argue with you about at a time which is more proper. I do not think a lot of people remember the true definition of charity.

Your appraisal of the insurance field does not match the figures. given us and you say medical care for the aged is a major domestic issue, and I claim it was not until you made it one.

Now, would you like to bemuddle any or all of that? I have some more but I will attach an appendix to my statement.

Mr. REUTHER. I do not want to try to take this list of yours and comment on it. I just want to say it is not correct to say that I personally have attempted to impugn the integrity or the humanitarianism or the good faith of doctors. That is not true. I said in my oral presentation that as a human being I am very grateful to them. It was the doctors who made me whole when I was fighting for my life. I think overwhelmingly the doctors of America are decent people who want to do what is right and want to practice good, high-quality medicine and minister to the needs of the people of this country. I just happen to disagree with the official position of their organization.

I ask you to differentiate-I have lots of arguments but I never get bitter with an individual. I may disagree with the position of an organization. In this case, I am not condemning individual doctors; I am disagreeing sharply with the announced position of the American Medical Association. 1 think they are doing a great dis