We are already undertaking the education of female employees in self-detection of breast cancer and have programs to help employees diagnose and cure the disease called alcoholism. If employers find a national health insurance program which allows them to continue to use their initiative in a flexible environment they will continue to respond to meet employees' needs. Then the government can concentrate on providing adequate coverage for Americans not protected by company or union plans. We hope that national health insurance will start by identifying a level of benefits that is a floor on failure rather than a ceiling on success.

Thank you again for this opportunity to express our views. I think that you will agree the Loop Bank Task Force on National Health Insurance and this Subcommittee have common objectives. We hope you will agree with our recommendations.

62-670 - 75-5

STATEMENT OF GEORGE MELCHER, JR., M.D., PRESIDENT
GROUP HEALTH, NEW YORK CITY (unedited statement)

Dr. Melcher. Thank you, Mr. Chairman.

First, I would

like to identify myself. I am President of Group Health,

Incorporated, of New York, a not-for-profit corporation with
about 3,000,000 subscribers.

In addition, we serve the carriers,

Group Health, a group that: is part of New York and also part

6

7

of Florida. I am also an associate and professor of medicine

at Columbia University College of Physicians and Surgeons, and President of the National Genetics Foundation.

In preparation for my presentation to you today, I

had to look back at a lot of old documents. I am a rather practical fellow, coming from the scientific worl as well as the business world. I ahppened to look back all the way about 30 years in my presentation. I would like to start back in

December 1969. At that time, a program was presented to the

Board of Directors of my company calling for a very vast change

19

in the organization moving from that of an insurance carrier to

19

20

21

22

one becoming directly involved in the delivery of health
care services.

Our company was the oldest not-for-profit carrier in the northern part of the United States. We had the longest experience in paying bills, we have probably had more first to our

2.4

credits than any other company in this country. And yet, our

25 directors, who were made up equally of lay people and professional

(62)

people, were very unhappy about what we had been able to accomp

lish. I think they were, in words, fed up with simply paying

the only people around, really talking about utilization of phy

sician profiles and a few other things. In any event, we

changed in 1969 because we were tired of simply paying bills,

and got into -- in many areas directly of services or ability

to contract for those servicos where we can write the see ifica

tions.

In 1969, the medical business was the second largest business in this country. We predicted very clearly and quite correctly that shortly it would be the biggest, and if we used this next

year, this year's costs, it is very clear that the way things

are going, that within another two years the medical business

will double the next largest business.

So, I think you really have to face the issue at this point in time of how much you can afford to spend. obviously, if you keep going the way you are going, us fellows

Because,

will take everything you have. And really, my point I am try-
ing to make to you today is that you have been 30 years getting
into this problem. I would like to identify at least who I
think are the actors and than try to perhaps point out: som
ways that I think we can go.

Now, obviously, if it took us 30 years to get here, and
that will be one of my claims, I don't see how you can try to

change it with a very rapid or single-minded cure because there

are a lot of different problems.

Actually, I think ono almost has to look at this as a clinical problem and try to come up first with a correct diagnosis, because it is pretty hard to get a cure. For the

Many

most part, I like to talk about programs of management.
diseases we can't cure, but we can manage the patient and manage

the illness. One of my former professors, probably one of the
greatest men in this century in American medicine, had five
rules of practice that he laid down for us. Before I start, I
would like to give you those five because I think we can find
our answers in these.

The first one is the golden rule. It is pretty obvious, if you are going to provide services to others it ought to be something that overrides everything else.

The second was, if what you are doing is working, don't change it.

The third one, obviously, would be if what you are doing isn't working, you at least better reconsider your position. The fourth one was, if you don't know what to do, perhaps you are better off doing nothing or getting a consultant's advice. You don't have to follow it.

The fifth one is rather interesting today in view of something called "second surgical opinions" that everyone is talking about, keep your patient off the hands of a surgeon. And than

another great physician that I had an opportunity to work with added a sixth one which many of us always laugh about, bu:

so frequently got caught with and that was, "make your OW! mistakes, don't incorporate those of others." So that pe chaps is a beginning.

I would like to go back historically and begin with 1946. Initially, that was about the time I got through medical school. My background at this point was lots of stars in the eyes and a great interest in academic medicine, and takinĮ care of people. I would remind you in 1946 we had a rather interesting event in San Francisco. The United Nations got

underway and about that time the World Health Organization

came around and I would like to remind you again of the preamble,

if I may, which says briefly, and I know you will remembe::

it, but perhaps we can mention it again, that "Health is state

of complete financial, mental and social wellbeing and no:

merely the absence of disease or infirmity."

1946.

You know, I think many people really believed that in Unfortunately, I still think most people believe i: is attainable. I would like to go on record now as saying in

is totally unattainable and I don't think we should keep looking
at it in that fashion. Now, what happened in 19467 We just
finished a war. We had a plethora of physicians coming back

and we really had the beginning of what was an explosion on
scientific medicine.

Interestingly enough, in looking back at the old histories