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COSTS AND DELIVERY OF HEALTH SERVICES TO

OLDER AMERICANS

THURSDAY, OCTOBER 19, 1967

U.S. SENATE,
SUBCOMMITTEE ON HEALTH OF THE ELDERLY
OF THE SPECIAL COMMITTEE ON AGING,

New York, N.Y. The subcommittee met at 10 a.m., pursuant to call, in the auditorium of the William Hodson Community Center, 1320 Webster Avenue, New York, N.Y., Senator George A. Smathers (chairman of the subcommittee) presiding.

Present: Senators Smathers and Robert F. Kennedy.

Also present: William E. Oriol, staff director; John Guy Miller, minority staff director; J. William Norman, professional staff member; Patricia G. Slinkard, chief clerk; and Carolyn Hyder, clerk.

OPENING STATEMENT BY SENATOR GEORGE A. SMATHERS, CHAIR

MAN, SUBCOMMITTEE ON HEALTH OF THE ELDERLY

Senator SMATHERS. The meeting will come to order.

First I want to say that I am very pleased to be here. This is the Subcommittee on Health of the Elderly of the Special Committee on Aging.

I am particularly delighted to be here in this Hodson Center, which itself bespeaks of the concern and interest of the people of New York and the State and the Nation of the problem of the elderly.

Senator Kennedy, I think, will be here shortly; he is delayed. He has already issued a statement to the press, and every indication is that he will be here.

I have a short statement which I would like to read before we proceed with our first witness.

This is the first field hearing to be conducted in our study of the costs and delivery of health services to older Americans, and it will give us on-the-spot information about several disquieting points made by expert witnesses at our opening hearing in Washington, D.C., on June 22 and 23.

The story told at that time can be summarized in three sentences:

Aging and aged Americans, those most in need of high-quality health services, often pay the heaviest price for deficiencies in those services.

Medicare and medicaid—although in need of several major changes that will make them more directly responsive to individual needs—are

1 Hodson Center, at its opening in 1943, was the first Day Care Center for the elderly in the world. For its history and description of present activities, see p. 608.

bestowing much-needed benefits; and they are performing another service by making longstanding health problems more visible.

Any discussion of costcutting in health services will be fruitless unless it also calls for major reorganization in the delivery of such services.

The Washington hearing also gave us some insights into the special problems of the elderly in metropolitan areas. Your former city health commissioner, Dr. George James, gave us much to think about when he said that New York City is “aging" by about 20,000 persons per year, that by 1970 you will have 1 million persons over age 65, making New York's aged the sixth-largest city in the United States, and thatwith a few impressive exceptions-most health treatment for the elderly is geared to treat the illness rather than the person.

In clinics of this city, said Dr. James, an elderly individual may often spend his time in a futile round robin of visits to various specialty services, draining his energies and not really receiving the kind of care he needs.

I must admit that the thought of spending hours in a clinic is bad enough for a young person in fairly good health. What is it like for an older person? I have a letter here from a woman who tells what it is like. Her statement-sent to me by a member of the Hudson GuildFulton Senior Association in Manhattan as a result of subcommittee staff inquiries—is called "A Day in the Clinic.” I will read it to you:

You have a pain, and don't know a doctor, you believe the hospital clinic may have more facilities to handle your case.

You come at 9 a.m. and wait for the clerk who takes your name and tells you you have to be screened as to your payments.

You see several more clerks, each time you take a number and wait. By this time the last person to see is a doctor who asks you what is wrong and tells you to go to another clerk for an appointment for a doctor who will treat you. When you get to this clerk he gives you an appointment in 2 weeks time. You still have the pain.

By this time it is 1 p.m, and you have not had any lunch.

Somebody suggested that you go to emergency department. This you do and all they do is give you some painkiller pills after waiting again-2 or 3 hours and you spend a whole day.

Medicaid, of course, is intended to relieve the problems encountered in clinics, but this program is still in its very early stages; it can't change old patterns overnight or even in a year or two. As the ranking majority member of the Senate Finance Committee—which recently concluded extensive hearings on this year's Social Security amendments

I am especially interested in proposals for constructive change in medicare and medicaid. I believe we will hear several such suggestions today.

We will also receive, I am sure, very helpful testimony on major innovations that will improve health care here. If this city has its share of problems, it also has a rich share of enlightened experimenters whose work may yield important lessons for the entire Nation.

Just a few blocks away, for example, is the Bathgate Center of the neighborhood medical care demonstration project. I understand that this center is providing much-needed services in an area that has fewer doctors than it did 25 years ago, even though population has dramatically increased. We hope to see the center later today, and I am sure that we will be impressed by the good it is doing.

At the same time, however, I must confess to a few qualms about its future. It is now funded through the Office of Economic Opportunity, and it was created only because of the determination, medical knowhow, and the grantsmanship of men associated with a well-established hospital.

Can we expect the development of such services in cities which may lack such sophisticated leadership? Do we need a new kind of Federal program to encourage establishment of such projects on a more widespread basis, perhaps not tied directly to antipoverty funds?

We have many more questions, but we will save them to ask during the course of this hearing. I will conclude this opening statement by thanking many individuals who have given help and guidance in the preparations for this hearing. We have received cooperation from the office of the health services administration, the State department of health, directors of hospitals, and many others. Particularly we are grateful to the persons at the Hodson Center.

I would also like to say that Mayor Lindsay has informed us that he would have been with us today if he had not set aside a brief time for well-earned vacation in the Virgin Islands along with 46 Governors of States. I hope that does not addle his judgment in this matter.

Gentlemen, we are now ready to go. Our first witness, Congressman James Scheuer, intended to be here and wanted to be here. He has long been concerned about the problems of the elderly, and in his absence I would like to say he has done very excellent work in this field and will continue to do so. I will also read into the record a telegram from him at this point. It reads as follows:

My regrets to you and other members of the subcommittee being unable to attend your hearing today. The House Committee on Education and Labor has been holding double sessions daily on economic opportunity. In absentia I welcome you and the committee to the Bronx and look forward to reading your hearings at Hodson Center on services to older Americans. James H. Scheuer, Member of Congress.

We also have a statement from Representative Seymour Halpern. (The complete statement of Congressman Halpern follows:)

STATEMENT OF SEYMOUR HALPERN, A REPRESENTATIVE IN CONGRESS FROM THE

STATE OF NEW YORK

This inquiry into the costs and delivery of health services to older Americans is an exceptionally valuable contribution to the well-being of older people not only in New York, but throughout the Nation. I commend the members of the Subcommittee on Health of the Elderly for their diligence in seeking to illumine the health problems of the elderly, and to search out the answers on the community level. Congress has passed legislation creating massive health programs. It must be encouraging to the people of New York to know that their advice is being sought to assist the Congress in improving these programs.

We in New York have serious problems in providing older people with adequate health care. We have more older people than any other State-about 1,900,000 who are age 65 or more. They represent 10.4 percent of our population, and this percentage is growing. These people are clearly not getting the health and medical care which they need. For a New Yorker who is now age 65, the average life expectancy is 13.77 years, which is lower than the national average. New York ranks 45th in the country in the number of years which an older man can expect to live.

New York is attacking the problem with a strong combination of Federal and State programs. About 1,900,000 people have hospital insurance under the Social Security Medicare program. Nearly all of these older people also have medical insurance coverage under Medicare.

However, Medicare covers only about 40 percent of the aggregate medical costs of the aged. New York's Medicaid program, therefore, is crucial in enabling older people to acquire needed health services without cost barriers. For the six month period from July 1966 to December 1966, the most recent period for which we have figures, 106,600 older people in New York were covered under the Medicaid program, at a cost of $68.5 million. The per capita figure for that period was $682. These figures are a measure both of our problem and of our success.

Traditionally, when we have thought of the problems of health care costs, we have thought of them in terms of the cost to the individual. Now, with the Federal and State governments so heavily involved, the rapid increases in the cost of medical care are a major concern for legislators. In 1966 the Bureau of Labor Statistics index of medical care prices rose 6.6 percent. The index of hospital daily room rates went up 16.5 percent. These increases are naturally reflected in the increasing costs of the Medicare and Medicaid programs. None of us, either in Congress or out, want to see these programs subverted by rising medical costs.

We in Congress will do what we can to forestall this possibility. We are working conscientiously to improve the legislative framework of these programs, to eliminate possibilities for waste and excessive costs. We are also approaching the problem from other directions. We are trying to ameliorate the current shortage of medical personnel. This country does not have enough doctors. It has been estimated that in hospitals the number of unfilled internships and residencies currently numbers approximately 10,000. A recent study by the Public Health Service revealed a need for 62,000 nurses, or an increase of 15 percent. This shortage of personnel will inevitably increase the pressure for rising medical costs. It will also make it increasingly difficult to acquire adequate medical care even in cases where cost is no factor. It is important, therefore, that we continue our efforts in Congress to encourage an expansion of medical education facilities and of scholarship and other financial aid.

I have been impressed by the testimony that has been given throughout this inquiry on the need to improve the efficiency of our medical establishments, and to experiment with such methods of delivery as the formation of groups of doctors into local clinics which can offer an older person total health care. The Social Security legislation which is now pending would provide for funds for experiments in delivery of high quality medical care at moderate cost. There is also a provision for experimentation with developing new types of medical personnel, who would be able to perform medical functions which do not require the very high degree of specialization which a doctor needs today. I hope the Congress will act to provide encouragement for this kind of experimentation.

The nature of the problem is clear: older people in New York and throughout the Nation need better medical and health care than they are getting. I beliere that Congress must and will act when it can usefully do so. But the solution of the problem lies also in the hands of the public and of the medical professions, who must combine their efforts to serve the best interests of our older Americans.

Our first witness today, then, is going to be Dr. Howard J. Brown, administrator of the New York Health Services Administration, who will be accompanied by Albert F. Moncur, deputy commissioner of the New York Department of Social Services.

Dr. Brown and Mr. Moncur, we are delighted to have you.

STATEMENT OF HOWARD J. BROWN, M.D., ADMINISTRATOR, NEW

YORK HEALTH SERVICES ADMINISTRATION; ACCOMPANIED BY ALBERT F. MONCUR, DEPUTY COMMISSIONER, NEW YORK DEPARTMENT OF SOCIAL SERVICES

Dr. BROWN. Thank you Senator Smathers.

We in New York City are very glad that you are concerning yourselves with the problem of health care for the aged. As you mentioned

from Dr. James' testimony, this is a major problem to us now in New York City because we now have 775,000 people over 65 and by 1970 we will have more than a million over 65.

Now, in testifying today I am really speaking from two viewpoints: one as the health services administrator for the city of New York, but also as the recent director of a medical care program that took care of a low-income neighborhood of over 100,000 people.

This was the Gouverneur medical care program, which was a demonstration experimental program and was designed to use the resources of the city's health services so that it would focus on the problems of people in their own community.

Now, while the health problems of the aged are by no means confined to our low-income areas in the city, they are accentuated there.

In the past in New York, and particularly in other parts of the country-and I come from the Middle West-larger homes plus close relationships with the family doctor often provided what seemed to be a workable pattern of care for older people. [Applause.]

(At this point Senator Robert F. Kennedy entered the auditorium.) Senator SMATHERS. Excuse us a minute, Doctor.

I had stated to the group here, Senator Kennedy, that you would be here and I felt sure you were on your way, so we are glad to welcome you here at these hearings. Do you have anything at this time to say?

Senator KENNEDY. It is just one page. Shall we put it in the record ?
Senator SMATHERS. Yes.
Senator KENNEDY. I will just place it in the record.

(The statement by Senator Kennedy follows:) STATEMENT OF ROBERT F. KENNEDY, A U.S. SENATOR FROM THE

STATE OF NEW YORK I am pleased to join Senator Smathers at this, the first field hearing of his subcommittee investigating the costs and delivery of health services to older Americans, New York City is an appropriate place for this inquiry to begin. For we have in abundance both the problems that beset health services in our Nation today and many constructive experiments in developing new solutions to these problems.

For example, we have the most liberal and extensive medicaid program in the Nation, which insures the availability of medical care to hundreds of thousands of New Yorkers for whom regular medical attention was previously an unattainable luxury and catastrophic illness a bankrupting disaster. But, if we have shown great promise in Medicaid, we have also exposed its weaknesses. For here in New Yorkas elsewhere in the country-medical costs have skyrocketed in the last year and a half. Some individual physicians have taken undue advantage of the new bonanza and enriched themselves at the expense of the taxpayer. And the fees for all physicians under the program have more than doubled in many categories of care. Hospital costs have soared, in many cases without justification for reimbursement is available almost regardless of the levels of costs and there are insufficient incentives to make hospital management more efficient and less costly to the taxpayer.

2 Additional statement by Senator Kennedy on Vedicaid appears on p. 497, Appendix 1.

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