On behalf of the 500 men and women 60 years of age and over, who are members of Council Center for Older Adults, I should like to state at the outset that we are completely and wholeheartedly in favor of a health insurance program which would be financed and administered through the social security system. The problem of meeting the rising cost of medical care during the later years of life is a source of the deepest concern and anxiety to older people. In the 14 years since council center was established, this problem has come up time and time again, both in group discussions and in individual conversations. Older people live in constant fear that the cost of medical care and hospitalization will wipe out the savings of a lifetime. The steep increase in medical costs, particularly hospitalization, 46 percent since 1950, according to statistics published by the Federal Counsel on Aging, has made health insurance a necessity. This is borne out by the rapid growth of voluntary health insurance in this country in recent years. Unfortunately, only a very small proportion of our members have such insurance, nor do they have any other adequate protection against long-term illness. As President Kennedy pointed out in his special message to Congress outlining health plans: "Those among us who are over 65-16 million today in the United States-go to the hospital more often and stay longer than their younger neighbors. Their physical activity is limited by six times as much disability as the rest of the population. Their annual medical bill is twice that of persons under 65-but their annual income is only half as high." I feel certain that the Committee on Ways and Means has all the necessary statistics. Speaking as an older person and as an officer of an older adult organization, I can only stress that the need for a health insurance program is urgent. Further, that it is only through a broad insurance program under social security, that the older person will be able to get adequate health care with dignity and self-respect. There is a fairly sizable proportion of our membership, mostly widows in their seventies and eighties, who are not covered by social security, and are living on a very marginal income. Many of them are subsisting on an income below the public assistance level but try to get along as best they can so as not to become public charges during the last years of their life. I might also add, that the average monthly social security benefit received by our members is quite low, about $70 per month. It is also essential that provision be made for adequate medical care for the large numbers of older people who are not covered by social security. I should only like to add that the board of directors of the Newark YMYWHA, has endorsed the principle of financing medical care for older people through social security and has communicated its views to the Congressmen of Essex County, N.J. Again may I urge on behalf of the members of Council Center for Older | Adults that an adequate health insurance program for older people, financed and administered through social security, be reported out favorably by the Committee on Ways and Means. Sincerely yours, JACK GOLDSTEIN, NEW YORK, N.Y., August 3, 1961. LEE H. IRWIN, Chief Counsel, House of Representatives Ways and Means Committee, In re H.R. 4222, hearings on which are now taking place, the National Association of Jewish Homes for the Aged wishes to record its general agreement with the purposes of the bill and offers its support. Our association, however, representing the overwhelming majority of voluntary, nonprofit Jewish homes for the aged in the United States, desires to call your attention to several points which should be clarified. 1. Use of term "nursing homes" may be misleading. We urge change in wording, wherever this appears to institutions, including homes for the aged, which have facilities for nursing care. 2. Under home, health services, place or residence maintained as such individual's homes, should clearly indicate that it includes residence in home for the aged, boarding home, etc. HERBERT A. FELTZER, Executive Director of the Home and Hospital of the Daughters of Jacob, Chairman, Legislative Committee National Association of Jewish Homes for the Aged. COMMUNITY HEALTH ASSOCIATION, Hon. WILBUR MILLS, Chairman, Ways and Means Committee, DEAR CONGRESSMAN MILLS: It has come to our attention that the Ways and Means Committee is now planning to hold hearings on H.R. 4222, the so-called Anderson-King bill. This is good news and we urge that the hearings be held at an early date so that the proposed legislation can also be considered by the Senate Finance Committee and the whole matter be brought to issue during the present session of the Congress. Those of us who are engaged in administering a program of comprehensive health services on a group practice-prepayment basis know from our own experience that extremely few elderly persons can afford to purchase broad medical care benefits through this or any other form of voluntary health insurance. It is simply beyond their means to participate in more than a minimal, token plan. Moreover, great stress is placed on those few voluntary plans that have attempted to provide what amounts to about twice as much service to elderly persons as others need, at a cost comparable to what the better risk groups pay. The proposed Anderson-King bill offers promise of solving a major part of the medical care problems faced by aged persons and doing this in both a time-tested and a dignified way. What is proposed bears no resemblance whatsoever to socalled socialized medicine. In fact, the bill provides assurances to both providers and consumers of care that safeguard fully the rights and privileges of all concerned and represent the antithesis of governmental controls. Adequate financing of the segments of care outlined in the bill will furnish a framework for the steady enhancement of the quality of services rather than leading to the reverse -situation. To sum up, the proposed legislation has our complete support and we hope you will do what you can to make it possible for the legislation to be considered by the Congress during the present session. Yours sincerely, F. D. MOTT, M.D., Executive Director. BALTIMORE, MD., August 1, 1961. LEO H. IRWIN, Chief Counsel, Committee on Ways and Means. DEAR SIR: In accordance with letter of July 27, 1961, from John R. Martin, Jr., Assistant Chief Counsel, addressed to Hon. George H. Fallon, M.C., I am writing you and requesting you to have this made part of the record and printed in the hearings of H.R. 4222. I was born in New York City on September 10, 1881, and have been a contributor on social security coverage from the time it started. I am retired from business and a recipient of social security. Most of my business career was in the beef and pork packing industry as manager and supervisor of departments and branch houses and plats for the Schwarzschild & Sulzberger Co. and its suc⚫cessors, Sulzberger & Sons, Co., and Wilson & Co., Inc., in New York, Chicago, and Havana, Cuba. If I were to testify I could give you a good many reasons why I think coverage of old-age hospitalization and medical care should be placed under social security financing, regulation, and management. I will however, now just give my reasons why two other methods of coverage proposed are not beneficial or advisable. First, the so-called Kerr-Mills amendment, H.R. 12580, This was adopted and became effective in Maryland on June 1, 1961. This bill which was backed by, and now still is being referred to by the American Medical Association in their advertisements as giving proper relief without embarrassment to the recipient is being administered in Baltimore by the Baltimore City Health Department and the Baltimore City Department of Public Welfare under rules and regulations of the department of public welfare. While these regulations do not require a pauper's oath, they do embarrass a great many applicants who, like myself in the past, did not require the assistance of relatives to pay the present day high medical expenses and now, however, do require it and do get it when needed. Many worthy applicants do not want their relatives bothered and therefore are prevented from getting this benefit to which they are entitled. Second, the proposed coverings by private insurance. Some few years ago when the large insurance companies were finally starting to accept 65 years and older for hospitalization and advertising through full-page advertisements this fact, I called on the local agent of one of the largest western companies. (If it is of service I shall be glad to give you the name of the company.) I was told by the agent that the rate quoted was so low that the company was losing money by quoting it and that they and other companies were doing this only to avoid and prevent insurance under social security becoming a law. Under these circumstances I did not take out a policy and I noticed that the rates were subsequently advanced. I later took out a policy with a large national group of senior citizens, who subsequently, guided by the insurance company which underwrote this group policy, tried very hard to switch me to another policy at a higher rate and even sent me the new policy without my having applied for it. I feel that many elder people have had the same or similar experiences and they feel like I do, that private insurance companies do not give them the protection they should have and are only waiting for the time when they can use their influence to raise rates to repay them for their expenses in connection with their campaign to stop social security legislation. I feel that the Social Security Administration has done an outstanding job in their present duties and that old-age hospitalization and medical care would be equally well serviced by them. Respectfully submitted, HENRY M. SCHWARZSCHILD. A COMPROMISE PLAN SUGGESTED AS AN President Kennedy's proposal for improved health safeguards would clothe many of the American people in a protective garment of excellent material. The program indicates a high degree of sophistication in the selection of the fabric, but the tailoring of these health measures to the needs of the individual does not exhibit a skill commensurate with the quality of the cloth. Indeed, some Americans would feel the chill winds of financial disaster because they had no pants at all, while many others would be required to buy still another suit to hang, unused, in an already overcrowded clothes closet. Almost no opposition has been raised to the administration's ideas for ways to increase the supply of doctors, improve nursing and hospital services, step up medical research and elevate the level of health of our children and youth. The controversy, vigorous and vocal, centers around that portion of the President's program which would provide, through the mechanism of social security. medical care for persons over 65. The fact that efforts to enact compulsory health insurance legislation have met defeat repeatedly since President Truman gave his approval to the principle more than a decade ago may forecast further difficulty for the President's ideas. even though the administration has returned to the Democratic Party. If this should be the case during the upcoming discussion of health care for the aged in Congress, a compromise which would alter the proposed program, making it acceptable to those who now oppose it while expanding and improving the measure to better fit the requirements of all of the people, may be welcome. Let us examine the specifications of such a compromise. The spirited Reuther-Annis debates broadcast on television gave the impression that the AFL-CIO position, squarely behind the social security idea, could never be compatible with the aims of the American Medical Association. Closer examination of these opposing views shows that labor and the doctors want many of the same things. For example, the physicians are unwilling to give up the personal doctor-patient relationship of private medicine, and this has become one of the important issues in the AMA's opposition to socialized medicine. President Kennedy, in announcing his health proposals, insisted that "this program is not a program of socialized medicine" and that everyone would have the opportunity to choose his own doctor and hospital. Mr. Reuther stated that socialism in medicine means that all doctors would go on the Government payroll, and the administration of hospitals would be taken over by Federal authorities. This, he pointed out forcefully, is not even suggested in the social security health program for people over 65. Dr. Annis and Mr. Reuther both attested to their common objective of providing the best possible medical care for all Americans. This shared goal furnishes a reasonable starting point for the compromise, which may be desirable. What is right about the administration's program? Several progressive ideas have been woven into this protection, which demonstrate enlightened awareness of current problems. First, the principle of deductible insurance has been utilized requiring the patient to pay the first portion of the hospital or clinic charges, a stipulation designed to control overutilization of medical facilities. Mr. Reuther's statement that only a physician can admit a patient to a hospital is correct, but doctors are often pressured into hospitalizing patients who insist on being admitted; even though their condition may not require it. Every doctor of medicine is familiar with the request, "Put me in, Doc; I've got insurance that will pay for it." Next, the Kennedy proposal includes the medical and financial advantages of progressive patient care. All patients do not need hospitalization, and the social-security-linked program includes outpatient or clinic service, care in nursing homes and in the patient's home. With general hospital costs pushing $50 per patient-day in northern and Far West institutions, hospital service must be utilized only when other means cannot meet the medical needs of the patient. Also, the principle of prepaying medical care needed during "the autumn of life" over the period of the worker's productive years is sound, equitable, and reflects the assumption of individual responsibility, which is traditional in America. This is a pioneer characteristic of strength, quite in keeping with the New Frontier. All of these features provide great tensility, beauty, and wearing quality to the fabric used by the Kennedy designers. But now let us examine the cut of the cloth. Although there is greater incidence of illness among the aged, the passing of that magic milestone of 65 does not mean that medical problems shower down on each American as he steps up to collect his first social security check and that he is promptly and invariably swept away to financial disaster. Indeed, this may have happened to him months or years before the age of retirement; or, on the other hand, he may never suffer prolonged and costly illness. Therefore, to assume that medical problems begin at 65 is similar to saying that "life begins at 40." Any program of improved medical care ought to include every age group in its protective coverage. Dr. Annis stated that of the 16 million Americans over 65, 4 million need help with their medical finances. The social security program proposes to include everybody now under this Federal retirement system, without regard to their need for aid. The fact that the employer also contributes to social security means that the price of the goods he sells must go up to cover this increased cost. Thus a hidden tax, paid by all, helps to support a program of medical care for 12 million people who do not have financial problems caused by illness. This, it would appear, is a rather cumbersome and costly approach to the problem. Then, too, there are persons who are not covered by social security, who would be excluded from the benefits of the proposed medical care system. The doctors themselves would not benefit from the coverage the Kennedy program would provide for their patients. This might not be serious for physicians as a group; for they have above-average income and can provide for themselves, but it does point up the inequities of the suggested system. Oldsters without financial difficulties caused by illness (the 12 million mentioned by Dr. Annis) would be provided with extra protection not actually required. The question would then arise, "What shall I do with the insurance I have?" The most probable answer would be to drop the protection afforded by private enterprise through Blue Cross or a commercial company. This would mean that not only would Government be competing with private industry, but almost 7 percent of the population would receive benefits where a need does not now exist. The money to pay for this additional, unnecessary coverage would | be derived from taxation levied against the remainder of the people. The situation would be most inequitable at the outset of the program, when those already at retirement age would have made no contribution toward the benefits they would receive. These are the principal values and disadvantages of the President's proposed health scheme for the aging. Now let us see how the advantages can be retained while reducing to a minimum the drawbacks just listed, so that a well-fitting garment of health protection may be produced for every American. A unique plan for the care of medically indigent patients, utilizing commercial and Blue Cross insurance and assessing the taxpayer for only that part of the medical care bill which the patient himself cannot pay, has been in operation in Memphis, Tenn., for more than 3 years. The principles and methods employed by the Memphis plan are suggested as a basis for the compromise program which may conceivably be needed. The City of Memphis Hospital is a 700-bed institution, the major portion of which is used to provide medical service for acutely ill patients who cannot afford private care. This municipal hospital, which is also the clinical teaching facility for the University of Tennessee College of Medicine, once gave care away, free, to all who were eligible for admission. In 1952, however, the directors of the institution recognized that there are degrees of indigency, that only a small percentage of the hospital's patients were so destitute that they could afford to make no contribution toward the cost of their care. The remainder of the patients, while not able to pay for private care, could pay some part of the bill. This part-pay group was then asked to be responsible for a portion of the cost of the service they received, and this portion was scaled to each patient's ability to pay. This system worked relatively well, but the job of collecting even small sums from those who had been used to receiving free service was an uphill task. To simplify the accounts receivable problems, the Memphis plan was put into operation in November of 1957. This plan requires that each citizen who expects to use the municipal hospital purchase commercial or Blue Cross insurance which will pay benefits equal to that portion of the cost of the hospital service for which he is judged responsible. For example: A family man whose income ranges between $200 and $325 a month is expected to carry hospitalization insurance which will pay $8 a day room and board charges up to 30 days' stay in the hospital and will cover $80 of the expense of diagnostic services and treatments such as X-rays, drugs, and laboratory tests. Suppose he is confined to the hospital for 10 days. His insurance would pay $80 room and board and $80 miscellaneous expense. This 160 total is 71 percent of the average $225 cost of hospitalization of the city of Memphis hospitals. (The current $22.50 per patient day cost in the John Gaston unit of the Memphis Municipal Hospital is considerably lower than the per diem expense in other general hospitals.) The remaining $65 is paid by city taxpayers and comes from the general municipal fund. Families with less than $200 a month income are required to have proportionally less insurance coverage. These requirements are divided into three simple groups; and as long as the insurance held by the patient pays as much as the minimum benefits stipulated for his income group, the patient's responsibility to the hospital is completely discharged. The very low income groups. and those receiving welfare assistance, pay nothing. Insurance requirements are based on the local welfare department's estimates of minimum budgets for average size families living in the Midsouth. Premium cost of the insurance for the average size family is well within the amount shown for miscellaneous medical expense on these budgets and less than the percentage of income spent. on the average, by American families for medical care. Services of the doctors are rendered without charge, and clinic fees are nominal; therefore the major medical expense these families have is the cost of their insurance protection, which is held to a reasonable level. At the time the Memphis plan was announced, Nat Williams, columnist for the Tri-State Defender, a semiweekly newspaper serving the Negro community, wrote: "Now somebody's going to kick sure as you're born. Some folk don't feel they should be expected to pay their way when there's a chance to mooch. Gangs of folks feel the world owes them a living. Too many colored folk have been observed riding up to the John Gaston Hospital in late model cars for a couple of dollars' worth of treatment. Somebody's got the idea that if Negroes |