6. That if the so-called voluntary nonprofit prepaid medical plans fail to meet the medical needs of trade union members and the American people, the Pennsylvania AFL-CIO call upon the National AFL-CIO to return to demand for passage of a national health insurance bill for all the American people on the principles of the former Murray-Wagner-Dingell bill.

STATEMENT OF MILES C. STANLEY, PRESIDENT, WEST VIRGINIA LABOR FEDERATION, AFL-CIO

PURPOSE OF STATEMENT

The general position of organized labor, the AFL-CIO in particular, on how adequate health and medical care for our aged citizens can best be secured and maintained has been given wide publicity and the committee has considered a statement by Mr. George Meany, president of the national AFL-CIO, during the course of its hearings on this matter. Therefore, this statement shall be confined to the aspects of the problem peculiar to West Virginia and observations based on experience under the current "medical aid for the aged" plan in effect in the State since October 1960.

STATISTICS RELATING TO THE PROBLEM IN WEST VIRGINIA

The 1960 census reports a population of 1,860,421 in West Virginia. Of this number 173,000 or 9.3 percent are 65 years of age or over. Directly related to the problem is the per capita income in the State which averaged $1,692 in 1960 or $574 below the national average of $2,266. Obviously, this substantially reduces the ability of the aged to pay for adequate medical care and militates against the ability of relatives to bear the added burden of financing the cost of such care. Moreover, the average old-age benefit paid in West Virginia is $72 per month and as a practical matter, this precludes the possibility of such persons affording to buy commercial insurance plans even if available. Conversely, hospital costs within the State rank well up with the national average. Figures compiled by the American Hospital Association show that the average per diem cost of all patients in general hospitals is $27.16 and the average inhospital stay is 7.4 days. Consequently, the average cost to the hos pital patient in West Virginia is $200.98 per admission, excluding medical and surgical fees.

MEDICAL CARE FOR THE AGED IN WEST VIRGINIA

On October 5, 1960, West Virginia became the first State in the Nation to enact legislation authorizing participation in the Federal-State medical care for the aged program as enacted by the 86th Congress under H.R. 12580.

Since that date, wide publicity has been given to this program through various press media and the information service of the department of public welfare which administers the program. This fact notwithstanding, the record shows that only 3,617 claimants of the 102,000 aged persons estimated to be eligible, availed themselves of the services offered by the program from October 1960 through April 1961. The average payment to each recipient during this period was only $64.97.

These facts raise two very important questions. First, is the program as presently established being utilized to a sufficient degree to adequately meet the problem; and secondly, are the benefits afforded by the program broad enough to meet the total medical needs of the recipients?

Diligent inquiry has been made into the first question and the answer is definitely no. Welfare workers, hospital administrators, and others with knowledge of the program have voiced a considered opinion that the program has not been utilized by eligible recipients because of pride. Numerous potential claimants have refused to apply for benefits under the program because it required a full disclosure of assets or a means test. Others refuse simply because it is administered by the department of public welfare, which until recently was named the "Department of Public Assistance."

Enclosed for consideration is an article from a Charleston, W. Va., newspaper containing statements by the commissioner of public welfare. Although these statements deal with another matter, they are pertinent to the issue at hand and vividly point up the important role that pride and self-respect play in the actions and reactions of West Virginians and indeed of Americans.

These opinions, which are shared by the AFL-CIO in West Virginia, are supported by the fact that only a fractional number of estimated eligibles have thus far utilized the program and therefore, its intended purpose of providing medical care for the aged population, that is medically indigent is not being fully realized.

Whether or not over a period of time more and more of the older population who are not receiving old-age assistance "but whose income and resources are insufficient to meet the costs of necessary medical services," as defined in the act, will, out of sheer necessity and desperation, decide to become a welfare case in order to receive services is a matter of conjecture at this time.

In regard to the second question posed above, it is evident that the average grant per recipient of $64.97 is substantially below the average cost per hospital admission of $200.98. However, included in the average grant are other types of services, such as outpatient, medical, etc. This fact notwithstanding, it is interesting to note that in Michigan, with approximately the same number of cases, the average grant has been $310.70. Such a wide disparity between these two States would indicate that West Virginia's program is not adequate to meet the need or Michigan's cost of medical care is almost five times as great as in West Virginia. Of course, we do not accept the latter thesis and submit that the program in this State needs to be improved even if H.R. 4222 is enacted, and our organization shall strive to bring about such improvements.

FINANCING THE MEDICAL CARE PROGRAM IN WEST VIRGINIA

Germane to this problem is the ability of the States to finance their share of the program. West Virginia's share under the present Federal-State program is 30 percent of the total. It has been stated by authoritative sources that if the MAA program were fully implemented and utilized in West Virginia that it would literally break the State to finance its share. We do not submit this as a fact but we would submit that already this program, coupled with many others, is placing a severe strain on the State budget. So much of a strain that in the regular session of the State legislature in January of this year, in spite of new taxes being imposed in the amount of $30 million, which increased the general revenue budget almost 25 percent, the legislature was hard pressed to find money to finance the MAA program for only 6 additional months or through December 1961.

The attached article from the July 14, 1961, issue of the Charleston Gazette states the problem in a clear, concise manner. Those of us familiar with the revenue problems of West Virginia know that a continuation of the present program of medical care at a cost of $10 to $12 million annually is not possible. Therefore, it is a foregone conclusion that an already inadequate program will have to be drastically reduced if relief is not forthcoming by the passage of legislation at a Federal level such as H.R. 4222.

West Virginia has demonstrated its interest and concern for the welfare of its older citizens by moving quickly to take advantage of that which was made available. To what extent this action was promised on the assumption that Congress would forthwith pass a more comprehensive plan such as it is now considering, again would be conjecture. Several factors lead us to believe that such was the case. Be that as it may, pressures for additional and improved State services continue to rise and, therefore, the MAA program must compete in the political arena for the tax dollar. This, in our view, should not be so. Unquestionably, it makes this social and humanitarian program subject to changing political pressures and economic factors that would not be present in a soundly financed plan as proposed in H.R. 4222.

In brief, we would submit that it is not in the realm of a practical achievement for West Virginia to finance the present MAA program for a long period of time. It is our opinion that should utilization of the program increase substantially, or should per case cost rise appreciably, immediate action will be taken to reduce benefits or to discontinue the State's participation in the current Federal-State program.

SUMMARY AND CONCLUSION

In summarizing the information contained herein and certain opinions and conclusions we have drawn therefrom, we submit the following:

(1) The average older citizen in West Virginia cannot afford to pay for adequate medical care; nor can he afford to purchase protection against such costs in the commercial market.

(2) Cost of medical care in West Virginia closely approaches the national average while individual resources are substantially below the national average. (3) The present medical care program in effect in the State, as authorized by the Kerr-Mills Act, is not being utilized by eligible recipients because of its requirement for a means test and its stigma of being public assistance.

(4) The MAA program in effect is not comprehensive enough to provide adequate protection for those who are taking advantage of it.

(5) Financing the State's share of the program even with minimum utilization has placed a strain on the State budget, and maximum utilization would make the cost to the State prohibitive.

For these and many other reasons, which have previously been considered by the committee, the AFL-CIO in West Virginia vigorously supports H.R. 4222, and sincerely hopes it will be given favorable consideration by this committee and by the Congress.

[From Daily Mail, Charleston, W. Va., Aug. 10, 1961]

DEPARTMENT FEARS PARING BACKFIRED WERE NEEDY SCARED OFF LISTS? The State department of welfare expressed concern today that some persons who are eligible for and need surplus foods, actually are not getting them. Now in the midst of a full-scale recertification of all nonpublic assistance recipients receiving commodities, the department said:

"Tight control and prosecution of chislers on the rolls may have caused some eligibles to shy away from what is rightfully theirs.”

Welfare Commissioner W. Bernard Smith said: “It is not our desire to show a great number of persons stricken from the commodity rolls, if any of them are needy West Virginians eligible for this food.

"For it is this group we are protecting in our investigation of commodity recipients. And punitive action will be taken against those, not eligible, who apply for and receive commodities."

The department said that any person who feels he is eligible may apply through the local county commodity warehouse.

There are three categories of recipients:

Public assistance recipients-those persons eligible under the public assistance programs of the department of welfare, or benefits under old-age assistance, aid to dependent children, aid to the blind, and aid to the permanently and totally disabled programs.

Private assistance recipients-persons who receive financial or other assistance from private charitable or welfare organizations.

Others those not receiving public or private assistance, but who, because of their economic circumstances, are determined to be needy persons. Eligibility in this last category is determined, the department said, by the number of persons in a household compared to monthly income.

Smith added that past records show in some cases the truly needy are the first to take themselves from the relief-giving rolls. And he added that pride and self-respect, to them, take a precedence over their need.

"For the most part the long hours of standing in a commodity distribution line have stripped them of this pride and self-respect," he said. "But there

are those who cling to these traits as dearly as life itself. It is for these that we are removing the thousands from the free food lists."

More than 15,000 persons have been removed from free food lists in the last 2 months. The department feels "there are still those who failed to reapply for one reason or another and are eligible to receive the surplus commodities."

[From the Charleston Gazette, July 14, 1961]

THOMAS F. STAFFORD'S AFFAIRS OF STATE-TROUBLE AHEAD FOR CARE PLAN When House Speaker Sam Rayburn said in Washington this week that the House wouldn't get around this year to acting on the Kennedy administration's aged care plan, he sounded a warning that reached all the way back to West Virginia.

Without passage of the administration proposal, which would shift financing to social security, this State will be hard pressed to meet its aged care obligations in the year ahead.

This, of course, is what the West Virginia Medical Association wants. Taking its cue from the American Medical Association, it has opposed the social security plan in every conceivable way.

The big trouble with such a position, as we have said earlier, is that it ignores the practical fact that medical care for the aged cannot long be sup ported through direct taxation. Social security where the individual would pay for his care in his unproductive years while he is still productive, is the only solution for financing on a permanent basis.

When the present program was passed last October, the financing plan adopted was a temporary expedient. Governor Underwood recommended a shift of funds from other purposes to carry the program until March of this year, and the legislature gladly acquiesced.

The 6-month plan was calculated to coincide with action in Washington on the social security proposal. At that time congressional leaders were confident they would have all the support they needed to make the shift from general taxation to social security within 2 months after Congress convened in January. When it was realized early this year that the social security bill was in trouble, the legislature decided to continue the program in the old form until January of next year. Aged care as a public service had been so slow getting off the ground that much of what was appropriated in October was still available.

With this backlog of funds, plus an additional appropriation of $1,325,256, it was believed that West Virginia would have enough money to last through December. The Federal Government pays 70 percent of the cost.

But the situation has changed radically since the legislature went home in March. Medical care costs have skyrocketed. Where they were running at $153,867 when the legislative decision on anticipated need was made in February, they were running at $391,859 last month.

State Welfare Director W. Bernard Smith is indeed worried. There is no longer any cushion to carry the program past December 31, as there was last March. As things stand now Smith either has the choice of stopping the program before the legislature gets here again to appropriate more money, or curtail services.

He has discussed the problem with Governor Barron, and chances are he'll order a cutback in services very soon. He and his staff are now studying ways

to reduce services without wrecking the program.

And what does the future hold after next January? In event the social security proposal is again sidetracked, it is believed that West Virginia's share of the cost of aged care will run to $10 million or $12 million annually.

This is a shocking prospect when you realize that the next legislature has no where to look for so much money without going through the painful process of revamping the entire tax structure.

Some people talk of a severance tax or corporate income tax as possibilities for next year, but both would tax the same groups covered under the business and occupation tax and therefore would run into very stiff opposition.

Also, when the legislature returns to Charleston next year, it undoubtedly will be faced with demands for higher salaries for State employees, new money for higher education and increased support for State institutions. The latter long have been neglected.

Medical care for the aged, therefore, will be not a singularly important problem the 1962 legislature will have to solve to balance its budget. It will be only one of many, and may come up short in the final, hectic shifting of funds in the late hours before adjournment.

And who is mainly to blame for this confusing situation? The West Virginia and American Medical Associations. They've done more than any other single group to defeat the plan that would put aged care on a financially sound basis.

STATEMENT OF WASHINGTON STATE LABOR COUNCIL, AFL-CIO

Organized labor believes that medical care for the aged is a matter of right. The Washington State Labor Council believes that the only commonsense way to minimize the tragedy that illness imposes on elderly citizens is through the establishment of a program of health care through the time-tested social security system.

This is the only method that will provide benefit as a matter of right. There will be no income or means test-no proof of poverty, no visit to the welfare

office. No matter where the patient lives, benefits will be the same and he can choose his own doctor and his own hospital.

Labor believes that voluntary health insurance cannot possibly do the job required to lift the crushing burden of continuing medical costs from the backs of our aged citizens. Only two out of five of our elderly people have any form of such protection and much of that is inadequate, most of it can be canceled and all of it is far too costly for those of limited income. In fact, a recent survey in the State of Washington shows that 64 percent of our people prefer the social security approach to the problem.

Organized medicine, perpetually fearful for the preferred financial status enjoyed by many of its members, is waging a major propaganda campaign in an attempt to deprive social security beneficiaries of assured and adequate medical care. Old people, some doctors say, can't have this protection because it may lead to socialized medicine.

There is no doubt, in any quarter, that millions of senior Americans, through no fault of their own, simply do not have the money for the medical care that their increasing years inevitably demand. Organized doctors, and we say this without malice, have done very little about this immensely serious problem in the past. Now, they apparently hope to prevent the rest of us from doing much about it in the future.

Fortunately for everyone, organized doctors are not the sole custodians of social progress in the United States. Special permission from the American Medical Association is not a condition precedent to our giving social security additional meaning by including medical care within its purview. Actually, of course, the doctors would not be affected by such a program. They would still be paid for their expert services on the present basis. The high-ranking financial position of the profession would not be prejudiced in the slightest.

It is clear that the King bill holds many answers to the problems posed by the compelling need for medical care of the aged. It is equally clear that opposition to this legislation from medical spokesmen is something less than fair and objective. This is not surprising. For years, the AMA has battled just about every progressive health insurance plan brought forth in our country. It wasn't so long ago, for example, that the AMA moguls were also condemning Blue Cross as "socialistic."

Thirty-three nations around the globe sponsor national medical care programs, of one form or another, for their older citizens. The U.S.A., the richest nation of all, has none. If the AMA has its way (and it will unless ordinary citizens put an end to doctors' dictatorship in the matter of medical insurance), thousands of elderly Americans will continue to beg or borrow medical care or go without it entirely. If this is a satisfying thought to the AMA leadership, it is grossly repugnant to the average American who has had just about enough of the same old dogma about "socialized medicine." Let's hope for the sake of older people now, and in the days to come, that the AMA is not permitted to block still another attempt of the American people to solve a major health problem in a sensible and effective manner.

There are approximately 280,000 persons age 65 and over in the State of Washington. Passage of the Anderson-King bill would enable 240,000 persons to receive health benefits in 1963, totaling nearly $23 million, or approximately $97 per person. In the State of Washington the average old-age benefit today is $76 per month, at a time when average hospital charges for bed and board are $23 a day in a semiprivate room. Obviously, after careful perusal of these figures, we can determine the terrific need for the additional benefits which H.R. 4222 would provide, and at the same time we can visualize the tremendous relief that would be afforded the already overtaxed public assistance rolls in the State of Washington.

The medical allowances of public welfare programs have been pathetically small and in many cases overstringent qualifying regulations have limited their usefulness.

Continuing unemployment intensifies the need for action since many of these older people have lost jobs, private pension rights, and any possible help from relatives who, in most cases, have felt the same pressures of a depressed economy.

Finally, we believe that only the social security approach to the medical problems of the aged will safeguard their independence, their dignity and peace of mind. Furthermore, we believe that the Nation's welfare agencies, hospitals, and Blue Cross plans will be strengthened by the enactment of health benefits through social security.