"I don't object to the paying of these rates provided the hospitals change the way they treat the patients," he said. "If these hospitals are taking this money to set up group practices where patients have an appointment system, where there are waiting rooms instead of long lines waiting in the clinics, fine. "What I fear, however, is that this is not happening . . .”

Irwin Karassik, executive director of the Metropolitan New York Nursing Home Association, complained that in addition to being inflationary, medicaid "rewards inefficiency."

RESULTS? SOME ARE "LUDICROUS," HE SAYS

He said there have been such "ludicrous results" as one nursing home getting $80 a month more per bed than an almost identical but more efficiently run home on the same block.

"What we want is a system under the American theory of profit which holds costs down and gives us a reasonable profit," Karassik said.

"I have never seen such a poorly run administration in my life. If it were private enterprise, it would go broke."

He denied that current rates meet costs, as contended by Schneider. Another major problem yet to be faced, Karassik said, was the shortage of facilities. Almost every one of the 25,000 nursing home beds in the state are filled.

Prior to medicaid, this shortage was acute. Now it approaches the impossible.

[From the New York Daily News, Sept. 21, 1967]

EXHIBIT C. WHAT'S THE MATTER WITH MEDICAID?-DOCTORS AND DENTISTS BOYCOTT IT

(By William Rice)

A boycott by thousands of doctors and dentists in the city has nullified one of medicaid's major guarantees-freedom of choice of a private doctor or dentist for every citizen of the state. The reason: for the most part, money.

While the state sets the qualification requirements for medicaid, it is doctors, dentists and druggists who decide who receives treatment as a private patient or customer.

Through boycott and selectivity, it is they who rule the private sector of this intensive pay-for-everything health plan.

Without their cooperation, medicaid's freedom of choice guarantee isn't worth the paper on which the legislation was written. Some have embraced the plan, many have not. Statistics tell the story:

Only about 3,000 of the city's 13,000 doctors in private practice have so much as waved a thermometer at a medicaid patient in their offices. And of the 3,000, some take only a token number of patients and others after taking part, already have closed their little black bags to the plan.

Of the city's 8,000 dentists only about 2.000 are pulling for medicaid. While the majority of the city's 2,700 pharmacies accept medicaid customers, there is a growing rumble of dissatisfaction and many druggists are threatening to dump the plan.

All three groups-doctors, dentists and druggists-are shouting for potent legislative and administrative prescriptions to cure what they consider the program's ills.

And some aren't even waiting. They are taking the law into their own hands by quietly setting personal criteria for medicaid eligibility. They won't publicly admit it, but some accept medicaid patients only if they think the patients are in need and they refuse those they believe can afford the service.

DOCTORS OFFER MANY REASONS FOR OPPOSITION

Why is it so difficult to accept medicaid patients when payment is guaranteed by the city, state and federal governments?

The doctors say many of the fees are too low, that it takes too long to get paid, that there is too much complicated paperwork involved in shaking the dough

loose from governmental bureaucracy. And, they charge, medicaid is a boondoggle for too many patients who should be able to pay their own way.

One thing is certain, according to Dr. George Himler, coordinator of the city's five county medical societies. Medicaid is not making doctors rich.

Others disagree. One-high-ranking official of the City Health Department contended that it was possible for a hard working doctor to make $100,000 a year on medicaid fees.

This official, who declined to be identified, said there were at least two reasons why some doctors weren't overly enthusiastic about medicaid-reasons which they couldn't shout about.

If certain doctors switched to a heavy medicaid practice, he said, Welfare Department checks would replace a lot of cash they've been receiving from patients. And with checks, there can be no hanky-panky on income tax.

Secondly, he said, some doctors are afraid they will lose their "respectable" practice if "undesirable" medicaid patients are seen in their waiting rooms. Himler, however, sees other reasons for the doctors' lack of enthusiasm.

POINTS TO LOWER FEES AS DETRIMENTS

Medicaid's fixed fees, he said, are below city doctors usual fees and benefit rural doctors who historically charge less.

A doctor, under the plan's maximum fee schedule, receives $6.50 for a patient's first visit and $5 for each subsequent visit. A nonmedicaid patient would pay about $10, Himler said.

Doctors would be delighted to treat medicaid patients, he declared, but many simply can't afford to do so with the fee differences and still meet their financial obligations.

"The State Medical Society approves of medicaid in principle, to the extent that it helps those who need aid," Himler declared. But, he said, far too many people are eligible.

And, he charged, the city is at least 60 days behind on paying the doctors for treatment given under medicaid, with some bills dating back to 1966.

Himler asserted that solutions could be found by reducing the number of eligibles, placing medicaid in the hands of a statewide intermediary-such as Blue Cross and replacing fixed fees with fees based on the doctor's customary charges and the prevailing rates in his community.

A State Health Department official warned, however, that if customary and prevailing fees are granted, "the doctors will be driving a peg into their own coffin. They'll price the medicaid program out and bring in socialized medicine." Another physician's gripe concerns medicaid's setting professional standards which, the doctors say, is the province of the State Education Department and the medical societies.

DENTISTS FEEL MANY PATIENTS CAN PAY

City Health Services Administrator Howard J. Brown replied that low-income areas, which have the most medicaid patients, "tend to have fewer doctors and the quality of practice (there) is inferior to other areas. Lower-income people don't have access to the same kind of doctors as do the higher-income areas." Most of Himler's complaints were echoed by Dr. Herbert L. Taub, spokesman for the State Dental Society.

"As far as the concept is concerned," he said, "we are sympathetic to the need of availability of dental care for those who can't find the resources for it."

But, he declared, many of those now under medicaid can find the resources. Taub, too, urged that a fee schedule based on customary and prevailing rates be set. He said his state group has conducted a survey showing that the fee change would actually save money.

Taub also damned the present system under which a dentist must get prior authorization for much of his work. He gave these examples:

A patient is sent by his dentist to a dental surgeon for the extraction of one tooth, for which authorization is not needed. But the tooth is snagged onto another which, under normal conditions, would have to be pulled with it. Prior authorization is needed to extract two teeth. The surgeon must send the patient back to his dentist for a "dental survey." The dentist then must apply for medicaid authorization and the patient must wait weeks for it to be granted.

Root canal work is needed to save a tooth. If it is a single-rooted tooth, go ahead. If it is a bicuspid, with two roots, get prior authorization. If it is a molar, three roots, forget it-authorization is given only in unusual cases. So, Taub said, many dentists just yank-with no authorization needed.

Taub suggested that a dentist be paid his usual fees with a patient paying a small deductible-whatever he can afford. Set an annual limit on the amount that can be spent on a patient, he suggested, and if extensive work is necessary, some can be done now and some next, as is done with paying patients.

And extensive work is needed by a large segment of the medicaid population. City Welfare Commissioner Mitchell I. Ginsberg declared:

"The area of services showing the most dramatic change (under medicaid) is the dental system. People are now getting dental care where they never saw a dentist before.

"And dental care is expensive. Those who cry about costs will cry most sharply about this. There is a tremendous backlog.

"The costs are going to be high."

But, whatever the cost, first-class care cannot be given until more dentists and doctors participate.

Druggists also have medicaid ailments and their own prescriptions for solving their problems.

Benjamin L. Gudes, secretary of the Emergency Committee for Pharmacists and Public Health, estimated that $2.5 million already is owed the city's 2,700 drug stores and the debt is still growing.

"It's been a mess since October and that's a pretty long mess," he declared. "Let the city pay the money. There is no excuse for this kind of behavior."

The problem is so great that a number of pharmacists, forced to take out loans to meet their bills, are preparing to sue the city to collect, Gudes said. Another thorn is the dispute over prescribing drugs by generic names rather than by the more expensive brand names, he said.

Under present regulations, for a druggist to be paid the full wholesale cost of each prescription, plus the allowed 66%% markup under medicaid, the generic drug must be given unless the doctor specifically notes otherwise.

PRESCRIPTION NAMES ARE A HEADACHE

If the doctor prescribes by brand name and fails to mark the prescription that this brand specifically is to be given, the druggist is to fill it with the generic equivalent.

"We are legally and morally bound to dispense whatever the doctor writes," Gudes declared. "If they want to save money their problem is with the physician-get him to prescribe generically."

A spokesman for the Health Services Department said this squabble is the major cause of payment delays. The city has installed a computerized payment system but the computer spits out bills that don't comply with the rules.

The computer became so confused recently that it mailed a check to a Brooklyn druggist with the amount left blank.

The pharmacist, Samuel Hankin of Brooklyn, threatened to fill it in for $1 million if the Welfare Department didn't come up with the $2,500 owed him, some of it dating back to last November.

Hankin and other druggists complain that even when the bills are paid, up to 25% is missing with the computerized statement giving no reason.

Gudes feels the issue could be resolved if the city established a flat service fee for filling each prescription instead of squabbling over percentages on each order.

Until this comes about, pharmacies face financial disaster, he warned.

[From the New York Daily News, Sept. 22, 1967]

EXHIBIT D. WHAT'S THE MATTER WITH MEDICAID?-PROGRAM ITSELF IS VERY SICK AND URGENTLY NEEDS A DOCTOR

(By William Rice)

Medicaid, designed to bring costly modern medicine to everyone who needs it, has proved itself to be an unwieldy cripple.

But the cost of medical care is zooming to a point where only the rich can afford it and someone must pick up the tab for those who can't.

Like it or not, medicaid-or something like it-is here to stay. This is the opinion of those who administer it, of those who run the public health agencies, and even of many physicians who are the most vocal critics of the plan.

In the first three segments of this series, THE NEWS has chronicled many of the failures of New York State's medicaid program, the most far-reaching health legislation in the nation.

The complaints are universal-doctor and patient alike are in pain.

What are the answers? What action must be taken? These facts emerge: The four-page medicaid enrollment form, just as complicated as the one you fill out for your income taxes, must be shortened and simplified to help bring millions of eligible people into the plan.

Fees to hospitals, nursing homes, doctors, dentists, druggists and others must be sharply revised to keep the lid on costs, and a schedule of incentive payments must be set up to reward efficiency.

Fiscal logjams which have tied up medicaid payments for many months must be unscrambled to draw boycotting doctors and dentists into the plan.

Everyone agrees these are medicaid's most urgent needs, though there are many other problems. And they sound simple, but they aren't. Implementation is the hitch-a big one.

DOCTOR COOPERATION MOST VITAL

Legislation is needed now both on the state and federal levels to take medicaid out of its tortured infancy. And the cooperation of the entire medical community must be gained, not just a small percentage of it, to take the program into maturity.

Many believe the solution ultimately lies in the hands of the medical community. It is they who must hold down costs.

Computers can solve payment problems. Legislation may simplify forms. But all of this is worthless without doctors, dentists, druggists, technicians, optometrists, hospital staffs.

State Social Welfare Commissioner George K. Wyman emphasized that it is they who make the decisions upon which medicaid depends. "They are the people in charge," he declared.

Others think the problem lies in a quiet revolution within the health field. Medicine is undergoing a dramatic change; where, in the past, it was oriented to the private practice it is now becoming a hospital-based science.

HE CAN'T AFFORD EQUIPMENT

A private physician cannot afford to surround himself with the extremely expensive equipment now available for diagnosis and treatment. Indeed, even hospitals at times are forced to pool their resources.

City Health Services Administrator Howard J. Brown sees the solution to this, to rising medical costs and to the shortage of physicians in the formation of neighborhood group practice units where the doctors work on salary rather than on fees.

His administration, which oversees the city's health and hospital departments, currently is converting 25 health centers throughout the city into neighborhood ambulatory care centers where patients can get just this kind of treatment.

Brown said the Hospital Insurance Plan, under a city contract, already has enrolled 60,000 medicaid families under a flat rate per year-paid by medicaid— for total medical care except for dental work.

"A PLACE FOR ALL PATIENTS"

"This is not inflationary," he declared. "Fees for services results in inflation. In certain areas fees may be more than a doctor charges for. He raises his price." Brown also pointed out that the city has mapped a massive plan to bring its municipal hospitals up to snuff.

"There are enough beds in New York City," he claimed. "But there is a shift from city hospital to private and voluntary hospitals which no doubt has resulted in the voluntaries becoming quite crowded...

"This is why we are so concerned in turning our hospitals into a place for all patients.

83-481 0-68-pt. 217

"The municipal hospitals are getting $85.24 a day for each in-patient from medicaid and that ain't hay. I take the position that these (medicaid patients) are private patients. To give them the proper care we are undergoing a complete major renovation and a complete building program. The money is now there and we are doing it as fast as we can. But it will take time."

Dr. George Himler, coordinator of the city's five county medical societies, prefers a simpler solution.

"With medicaid, there no longer are any charity patients," he declared. "There is no need to have municipal hospitals. Phase them out and hand them over to the voluntary agencies."

But voluntary or municipal, medicaid is still going to be stuck with the hospital bill.

And Congress, usually freewheeling with public funds, is raising a storm over the mounting cost of its 50% share of medicaid.

The House has approved amendments to the Social Security Act which would deny federal medicaid funds to more than 600,000 of the estimated 6 million New Yorkers now eligible. The legislation now is before the Senate Finance Committee.

USING BRAKES ON THE UPGRADE

Wyman called the proposed cuts "utterly unrealistic."

"This is cutting down at the very time costs of medical care are skyrocketing," he declared.

"The state program is geared to help the guy who can't otherwise help himself, the employed who is faced with a medical bill he can't handle without spending his small savings or mortgaging his house.

"It keeps his off welfare. You might call it a preventive welfare service.

"Illness is the major cause of dependency in this country. Now we're going to cut it out (the plan) for everybody in the false hope that it will be an economy move."

This cut, if passed by Congress, will not cripple the state's medicaid program if Gov. Rockefeller has his way.

He announced that he will seek approval of the Legislature to have the state pick up the tab for any medicaid expense faced by the local counties above what they pay for this fiscal year.

This, a Rockefeller aid declared, includes any expense brought about by federal cutbacks.

Of course, the Legislature has the final decision but, as Himler posed: "What politician will withdraw aid from those already given it, even if it is too expensive?"

City Welfare Commissioner Mitchell I. Ginsberg backed this thought with the observation that a new power structure is being formed by medicaid.

SEES NATIONAL INSURANCE NEED

Before the program, he explained, the public assistance recipient made up a small segment of the voting public. Now, with about one-third of the state eligible for financial help, at least in the health care area, the little voices are swelling into a roar.

There are those who believe this roar will continue to grow, that someday there will be no question as to who qualifies for aid.

Wyman declared that the ultimate solution to the medicaid mess, not only here but throughout the nation, will be the institution of national health insurance.

"Then we wouldn't be involved with eligibility," he said. "Eventually, this is exactly what's going to happen. Sooner or later we're going to have a national health insurance program on a prepaid basis.

"But it will not be of the type used in England or Scandinavia. Doctors will not be employes of the government. It's going to be something resembling private enterprise.

"It will be like medicare (the federally legislated health plan for those over 65), national in scope, involving some form of prepayment."

But, until that day comes, if ever, New York is saddled with its medicaid. One question remains:

Will it continue to be a mess or will something be done about it?