fessor at the USC School of Medicine. I am also involved in the black congress of the medical association of the medical society and the Los Angeles County Medical Association.

As a major organization concerned with the health and welfare of our community and our Nation, we are pleased to participate in this hearing, hoping that by such deliberations the impending crisis in health care of the poor and needy will be averted.

The Medi-Cal program as presently administered actually promotes the exodus of medical resources from the ghetto. More and more health care vendors are becoming disgusted with the program and phasing it out as an economic hazard. More and more recipients, frustrated in their attempts to obtain health care near their homes, have returned to the county corridors and/or neighborhood emergency rooms for disjuncted, crisis-type medical care.

Why is this so? As a black physician, a product of the ghetto and as chairman of the Health Committee of Greater Los Angeles Urban League, I have been intimately involved in health care of our community and discussions of the same. The above observation continues to prevail in spite of the numerous efforts of the health care vendors of the black and brown communities, individually, and in groups, locally and in Sacramento, to rectify the inequities in the program so that they might continue to take care of their people. Considerable sacrifices of time and money have been made by these vendors with only minimal progress.

Dr. Francisco Barbera was in the audience prior to the lunch break. He is a representative of the Mexican-American community. He left a little document I would like to present to you.

His business was that of attending other business meetings, the result of which is to help subsidize his medical practice.

The observations made herewith are based upon individual and group interviews and conferences with scores of physicians, dentists, pharmacists, other health care vendors, and Medi-Cal recipients. The long delays in payment, nonpayment of many justified services, harassment of vendors, geographic discrimination in payment schedules and the demeaning superscrutiny of claims of ghetto doctors-with the "all those doctors in the ghetto are cheating, giving bad medicine, and making too much money" attitude-are all contributing to the rapid reduction of health care services.

Many health care vendors feel that those in charge are purposely again decimating the poor and needy by forcing them to barter their dignity for health care in crowded clinics and county corridors-particularly in Los Angeles-often many miles away and receiving such care all too frequently in a demeaning, discourteous manner.

Who suffers? The community. The recipient. The vendor is greatly inconvenienced, but he can move out and become employed elsewhere. Health care among the disadvantaged approaches "pre-Watts" days. One of the lessons learned, hopefully, from the Watts conflagration was that a large segment of the population of civilized Los Angeles had been sorely neglected-particularly healthwise-but could and would not be forever neglected.

When the State administration announced its cuts, considerable confusion, unrest and apprehension permeated the area. This feeling is again becoming more and more evident as more and more Medi-Cal recipients are frustrated in their attempts to obtain medical services.

Emergency rooms are having difficulty referring these patients for followup care to health care vendors in their respective communities. To many vendors, the Medi-Cal program is just too hazardous, economically.

GHETTO PHYSICIANS HARD-HIT

Ghetto physicians and other vendors are hardest hit, but intimidation and fear of reprisals prevent many from speaking out. Some have practices consisting of over 95 percent welfare recipients. Most have had to hire more personnel just to handle the Medi-Cal paperwork.

In spite of unfulfilled promise after promise on the part of CPS, many vendors have continued to empathize with the underprivileged, continuing their health care services.

Many have exhausted their savings, have gone on to borrow thousands of dollars to make payroll and other expenses and/or lost their credit ratings, due to nonpayment or long-delayed payment of MediCal claims.

Entire clinics have closed up. Many pharmacists have closed and others are on the verge. Near-foreclosure on homes have occurred as well as actual repossession of doctors' office equipment. Banks have refused loans on accounts receivable from Medi-Cal due to inability to ascertain dates-and amounts of payment.

An economic lid is placed on the ghetto. This ceiling restricts the quality of employees, the adequacy of working conditions, the desirability of the physical structure of the office or establishment, and frequently the quality of service rendered.

The unpredictability of payment-both time and amount-precludes any planning, even short-range planning for health care facilities by private concerns. In such a blighted area, private enterprise should be encouraged, not discouraged. As vendors of services leave the area, they are not being replaced. More health care personnel become unemployed.

The economic ceiling on the ghetto was recently endorsed by a County supervisor who was quoted by the Los Angeles Times as saying that private doctors should earn no more than $11,000 to $14,000 from taking care of county welfare cases.

Computing this on a 40-hour week-most doctors work in excess of 50 hours a week-this is maximally $8 per hour, less than plumbers' fees and considerably less than attorneys' fees. Inequitable substandard fees imposed on the ghetto suggest a continuing desire to keep the ghetto poor.

Rape of the ghetto of medical services is becoming increasingly evident as more and more vendors of health care are leaving the area. Many are locating on the periphery of the ghetto and are reducing their Medi-Cal participation as rapidly as their private practice increases. Others are moving to the periphery in order to increase the amount of Medi-Cal payments and decrease delays in the receipt of such payments.

Some are seeing recipients only on certain days or at certain times during the day. Some are outright refusing to see recipients. Continuity of medical care is becoming nonexistent. Community hospitals are having increased difficulty obtaining consultants in upgrading

medical care at the community level and with Los Angeles so spread out, this is profoundly tragic.

MOONLIGHTING PHYSICIANS

Moonlighting in Watts and east Los Angeles is becoming more prevalent and it is as evil as the absentee landlord system. All too frequently, the moonlighting physician is not available more than one-half to 1 day per week for followup, and emergency rooms, or the few doctors left in the ghetto are asked to perform this service. The moonlighting vendor is frequently from an area with a higher unit-fee for service-rating by the Medi-Cal program and, of course, bills from his office-so located.

Denial of equal job opportunity is inherent in these inequitable and probably illegal disparities.

Discriminatory and severe reviews of claims of major providers of services to the poor frequently cause interminable delays in payments and denial of payments for substantiated services. Many cuts and deletions appear capricious, arbitrary, and certainly discriminatory.

For example: two comparably trained physicians billing for comparable services on patients in the same hospital side by side in the same room may receive different fees dependent upon the location of their billing office in Los Angeles County.

Frequently, in the same batch of claims returned to vendors, there may be three or more different fees for the same item or service number. These claims are supposedly reviewed by peers. The whimsical nature and arbitrariness of cuts, particularly of claims from ghetto physicians, suggest lack of guidelines and/or the political philosophies and prejudices creeping into the judgments of some reviewers. It also suggests that many reviewers are ill-informed and/or insensitive to the health care among people of poverty. This system must be improved.

Financial and tax incentives are being suggested as means of attracting more dedicated businesses, teachers and other needs of the ghetto. The health care vendors have not asked for nor do they expect any such incentive. The vast majority are dedicated men and women who want only equal job opportunity to help to provide equal health opportunity to those who so drastically need it.

PHYSICIANS FEES DEFENDED

Here I would like to make a comment about the much-discussed and probably too-much-discussed fees. It was pointed out by one of the speakers that over a thousand doctors in California made $70,000 to $100,000.

Just some quick computations on that. You take the average doctor working 50 hours per week. This averages out to $12-the gross is usually about 50 percent-I mean, the net is about 50 percent of the gross. This averages about $12 to $15 per hour.

Even the doctor who makes $100,000 does not get more than $20 per hour.

Now, the county medical association-the California Medical Association did some investigation, and these figures were published, and

it was found that many of these claims were filed by doctors who hired two or more doctors under the same vendor number. This is highly emphasized, somewhat to the discredit of these physicians.

Now, also, Dr. Todd pointed out quite clearly that less than one in 1,800 doctors had been found to be guilty of these practices. So I think the scapegoat has to stop, and I think some inequities have to stop, and some serious planning has to go into at least making the Medi-Cal program available to people who need it.

The ghetto is suffering because of these inequities, and we are asking, frankly, that special attention be given to the ghetto in the processing of claims, so that the people in the ghetto will not suffer from lack of services.

I would like to introduce Dr. Phillip Smith, who is a member of the Drew Medical Society, which is the Los Angeles wing of the national society.

Senator RANDOLPH. Yes, Doctor, we would be pleased to have you speak briefly.

STATEMENT OF DR. PHILLIP M. SMITH, VICE PRESIDENT,
CHARLES R. DREW MEDICAL SOCIETY

Dr. SMITH. I only came down to substantiate the statement that Dr. Littlejohn made. The Drew Medical Society-the Los Angeles chapter of the National Society-is interested in getting medical services to the ghetto area.

As President Johnson stated at our meeting in Houston, one of the rights of people of the ghetto-of all people--is the right to adequate health.

Health services in the area cannot be given equally, and people cannot be placed in the mainstream of medicine unless we have equal opportunities for everyone involved.

In stating reasons for medicaid to the aged, there are hospitals in the Los Angeles area which will not admit medicare patients-if a black physician has this medicare patient-this patient is discriminated against. These have to be taken care of.

There are some hospitals, also, in the Los Angeles area which will not-which have a limitation-who will not admit black physicians to their staff, but yet and still, they can have a medicare patient admitted-one or two token-and this is discriminating against the physician.

We are not thinking about physicians we are thinking about the people the physicians treat. Once you discriminate against the physician, then you don't think about him, you think about the people he is treating, and these are the people we want to put into the mainstream of medicine.

Also, as one speaker stated about the fees-it is almost as though he feels that the doctor goes out and recruits patients. You must remember that in the ghetto area the physicians are in an area where the people are indigent. They were attracted there before the bill came out-like my practice is there-and one must realize the truth at that time.

OUTSIDE MEDICAL RELIEF

They had a system at that time called the OMR-outside medical relief. These doctors donated time-which, I have a card in my pocket which says, "You will treat these patients without any profits.'

Well, they had thousands of these type of cases which you were treating for $3 a visit.

At the time of medicare, all these patients were referred to medicaid patients. So you already had free patients in your practice.

It must be stated also that we are interested in care for the patient. If the doctor is working hard enough to warrant his fees-his money— then it should be given to him.

If you look at previous statements made by another person, you would feel that the cost of care is the most important. If the doctor is making $200,000 a year and giving quality care, I don't see why anyone should care.

Senator RANDOLPH. Thank you very, very much, Dr. Smith, Dr. Littlejohn, and Mrs. Dudley.

Your information you have given and your comments that you have set forth will be most carefully considered by the members of the subcommittee and the committee on aging.

I want you to know that even though we appear somewhat hurried as you gave your testimony, that will not be so when we go over what you have said, and attempt to evaluate it.

And certainly, we shall not only find it informative, but challenging, as we do our work.

Thank you very much.

Mrs. DUDLEY. Thank you.

Dr. LITTLEJOHN. Thank you.

Senator RANDOLPH. Mr. Mulder.

Mr. Mulder, you were present earlier today when the speaker of the assembly. Jesse Unruh, read his statement and made additional comment and answered questions from the members of the committee and the colloquy-do you recall his statements?

Mr. MULDER. In general, yes, sir.

Senator RANDOLPH. Would you have any comment--rebuttal, or what would you describe from your standpoint as the errors or mistakes, inaccuracies, or whatnot, if there were any, in his statement? Mr. MULDER. There are a few observations I would like to make for the record.

STATEMENT OF CAREL E. H. MULDER, DIRECTOR, CALIFORNIA DEPARTMENT OF HEALTH CARE SERVICES, HUMAN RELATIONS AGENCY

Mr. MULDER. My name is Carel Mulder. I am the director of the department of health care services. I am a career public servant21 years in public welfare, and 11 years in health care.

I would like the committee members to have a few points understood about the Medi-Cal program which may have escaped you in the course of the day.