adequate hospital facilities in given communities and areas, and have striven to provide and maintain them insofar as they could secure the necessary funds.

These church hospitals have been a practical means of extending Christian love and help to our fellow man. Not only have the immediate needs been met, but in their educational programs, interns and doctors have been trained, and a constant stream of young women have been educated for the nursing profession.

Without question, our church hospitals have provided a substantial segment of the hospital service which is available in our country, and many of these church hospitals are outstanding. Our church members and church organizations, who have in the past and who now continue to contribute to building and maintaining hospitals, have a profound desire to work for the betterment of mankind, and this Christian motive is an essential element in the membership of our association.

Within recent years, the demand for hospital care has far outstripped hospital construction. Normal population growth, obsolescence, amazing improvement in hospital care, and remarkable medical and scientific discoveries, have been factors in this increase. Not only has there developed an insufficiency in the availability of hospital care, but hospital construction has not always been carried out in relation to the need of given areas. Therefore, it is our belief that this bill, providing as it does for State-wide surveys to determine where greatest need exists, and Federal assistance for the construction of additional hospital facilities under an integrated program which will be developed with relation to that need, is an important step toward making hospital services available to all. We must have proper hospital facilities and equipment with which to render proper hospital care in the areas where such care is needed.

People who receive hospital care fall into two categories: those who can pay for the service rendered either in full or in part, and those who can pay nothing. Although church hospitals have always been primarily charitable hospitals, the rising cost of rendering hospital care because of improvement of standards, development of new methods of treatment, and other factors, has increased the burden of charity to a noticeable extent. It is probable that this cannot be avoided, and certainly, if it means rendering a lower quality of hospital care, we do not wish to avoid this added expense. However, there is no such thing as free hospital care-some one must pay for it."

Within recent years, the Blue Cross Plans have gone far to extend the availability of hospital services to the population by making it possible for the average wage earner, by pay-roll deduction, to prepay the cost of hospital care and thus protect more than one-seventh of the population, and this number is constantly growing. This is an excellent means of assisting people to pay their own cost of hospital care. However, we feel that the Federal Government, interested as it is in the health and welfare o fthe Nation, must come forward with some definite program for assistance to those who cannot pay their hospital bills and who cannot make arrangements for prepayment under Blue Cross Plans. While it is true that church hospitals along with other charitable hospitals furnish considerable care which is not paid for by the patient, it is apparent that they cannot be entirely without

income. Church hospitals usually operate with large deficits, which are made up by periodic appeals to the generosity and Christian ideals of church people. In order to render a higher quality of care and expand the availability of that care to a larger proportion of the population, it is obvious that this construction program must be followed by legislation to provide hospital care for indigents.

This Hospital Survey and Construction Bill is the first step in this program of making services available to every citizen. We are particularly interested in it because the assistance given by the Federal Government would be rendered without the imposition of paternalistic or dictatorial controls. People who render professional care, give it from humanitarian and altruistic motives, and are very sensitive to the implications of regimentation. The fact that this bill provides for a construction program developed upon objective determinations of need through scientific surveys is an important factor in our support.

The further fact that the responsibility for developing the program in each State is entrusted to people within that State, so that they may develop their own program according to their particular circumstances, seems to be an assurance that the underlying motives and purposes of the people who furnish hospital care in religious hospitals will be respected and preserved.

We think that is essential to assure the highest quality of hospital

care.

We are pleased that the people who developed this bill have recognized the spiritual factor of hospital service, as well as the purely physical.

On the other hand, it is recognized that there must be adequate safeguarding of Federal funds and some assurance that the State programs will be developed with uniformity and coordination. We are pleased with the way this has been done through the Federal Hospital Council. This council, with a majority of persons who are outstanding in fields pertaining to hospital and health activities, will assist the Surgeon General in the formulation of standards and methods of administration of the Nation-wide program and will have power to review his decisions with regard to approval of State-wide construction programs.

It is apparent that the time and effort of men of this caliber is not justified unless their deliberations have effective authority. For this reason, we favor the approval power given the Federal Hospital Council by this legislation. A strong council will add weight and strength to the far-reaching decisions which must be made by any centralized authority in this program.

Likewise, the extent of authority given the membership of this council should be a challenge to the hospital field to lend its best leaders for service on it. Present-day hospital service is a highly involved and technical matter requiring the best intelligence available. In developing a sound program, there is no substitute for actual, practical experience of people who are familiar with the problems involved because they have worked with those problems successfully. The American Protestant Hospital Association is eager to see that this program for the expansion of hospital services may be of the greatest possible effect in making high quality hospital services available to

more of our citizens. The Federal Hospital Council seems to be the best guarantee that this may be accomplished.

I wish also to discuss briefly with you the problem of appeal from arbitrary action by the State agency which was presented for your consideration yesterday by Father Schwitalla, president of the Catholic Hospital Association.

Our association is very much concerned at the possibility of arbitrary action by whatever agency may be designated under the law in any given State.

However, we have discussed at great length appeal procedure from such arbitrary action by appeal to the Surgeon General of the United States Public Health Service.

In our opinion, this would result in carrying endless local controversies to the Federal agency for final decision. We are certain that there will be arguments as to which organization is approved by the State agency to build a given hospital and that there will be competition within the States which must be resolved by decision.

S. 191 provides for a State agency and requires the State Advisory Council broadly representative of various groups within the State. We can see no better way of insuring objective judgment than is provided in S. 191.

I urge that this committee give this matter careful consideration. I am convinced that appeal to the Federal agency would be contrary to the division of authority between the State and Federal Government which has guided the formation of S. 191 as it passed the Senate. In conclusion, let me repeat that the American Protestant Hospital Association is proud to lend its support to S. 191 as passed by the Senate, which can be of such vital effectiveness in the health and welfare of America. Our hospitals today are crowded. Many hospitals have waiting lists of people who cannot have their ailments properly cared for because of the inadequacy of existing facilities. Some people have to travel too far for proper care because our existing hospital system has not been laid out with any carefully calculated measure of need in mind. This bill has been devloped for the purpose of beginning to correct this deficiency in the hospital network. Because of our interest and knowledge of today's conditions, we strongly recommend its speedy enactment.

Mr. PRIEST. Are there any questions, Mr. Winters?

Mr. WINTER. What is your suggestion as to the manner of appeal from the decisions of the State in making this survey; who should the appeal be taken to, in your opinion?

Mr. ERICKSON. I am frank to say that each time that we have discussed it, we have come to no particular decision, but we feel that it would be better to place the appeal court on a State level rather than coming to the Surgeon General's Office or the Federal Hospital Council, for the reason that there will be many of these matters that must be considered and a decision given, and the tendency to take that appeal out of the State will, in my opinion, vitiate the authority of the State agency.

I am inclined to think that if any given institution cannot make a case before its State agency, it should not be given consideration. Mr. WINTER. That is the point I had in mind. Supposing that in your State, a survey is made by the State agency set up under the provisions of this bill and some particular unit of hospitalization is left

out of that survey, do you think that unit should have the right to appeal to the courts to determine whether or not such unit should be in the plan; should be included in the program?

Mr. ERICKSON. It is my opinion that they should have the right to go back to the State agency for review of the case that the State agency will have considered all angles in the matter, and if they decide to change their decision, very well, but if they decide to stick by their original decision, I think that should be final.

Mr. WINTER. In other words, you do not advocate what I thought you did to start with, something that would provide for endless litigation and there never would be any hospitals built because of the fact that maybe this group thought they should be in and this one is out; they would be fighting in the courts for 3 or 4 years before they determined who was going to be the participating agency in that particular locality?

Mr. ERICKSON. And under those circumstances, it would be better to give it to either one. You get action; if there is going to be 3 or 4 years, it would be much better to make a decision that might not be exactly fair in the opinion of the institution that loses out; at least there would be hospital beds additional and facilities provided in shorter time than could be done if you are going to tie up funds and hold them until the court decides.

Mr. WINTER. At the present time, do you know of any area in the United States that is so overcrowded with hospital facilities that this question is liable to arise?

Mr. ERICKSON. Well, I do not think that in the big cities or the big population centers, there will be very much building to begin with under this act, because the remote areas, or the poorer areas will very likely receive first consideration.

I can see in every area where there are hospitals, there are bound to be disputes of one kind and another, but it seems to me

Mr. WINTER. Right at that point, why should there be any disputes? I would like to get that in the record.

Mr. ERICKSON. Well, in the first place, we could have two hospitals within a given area or two projected hospitals in a given area.

Mr. WINTER. You mean hospitals that are already built or hospitals that are being applied for?

Mr. ERICKSON. It could be new hospitals.

Mr. WINTER. New hospital construction?

Mr. ERICKSON. New hospital construction. And they could be projects supported by good organizations, such as the Catholic Hospital Association, or some group within the Protestant Association, or some other voluntary group, or there could be a municipality or a county that wanted to build a hospital.

Mr. WINTER. Just a moment. Would this preclude the municipality from building a hospital if they wanted to, regardless of this bill? Mr. ERICKSON. I think that if they wanted to share in Federal funds

Mr. WINTER. Well, that is correct, but I mean, if they wanted to go ahead and build a hospital, there is nothing in this bill that, after this survey is made, would prevent any agency of the local government or any church organization or any private institution from building a hospital in that area, is there?

Mr. ERICKSON. No. My understanding is that there is nothing to prevent any organization, whether it is voluntary or governmental, from doing that.

Mr. WINTER. Then, after the survey is made for new construction-I am just a little dense on this, I cannot get through my mind what objection anybody would have after the local authority has been designated by the governor or such other agency of the State, has made the survey and found that this organization shall participate in the program, if there are five or six or seven different organizations that want to build a hospital in that area, somebody, somewhere must have the authority to determine which agency is going to build it. Mr. ERICKSON. In my opinion, it should be the State agency. Mr. WINTER. I agree with you on that, but after that State agency makes that determination, do you not think that should be final? Mr. ERICKSON. I think so.

Mr. PRIEST. Mr. Erickson, this discussion of the question of the right, we will say, of an institution or an individual to appeal to the court, and your statement in reply to some questions asked by Mr. Winter that you believe it should be settled on the State level, when such a controversy or issue arose, that leads me quite naturally to another feature of the bill that you have already mentioned, and that is, the provision in S. 191 that provides court appeal procedure to override the Surgeon General, we will say, if he does not approve a State plan.

I gather from your statements that you feel that court review on the part of an individual might lead to endless litigation, and I concur in that.

I think we are in danger of making a departure here on this other issue of court procedure that will greatly involve the administration of the Federal-aid program. I can understand the position of your association and certainly you have every right to take whatever position you want.

As I see the whole question of administering Federal aid, the provision in S. 191 for court procedure which was eliminated in a bil! which I introduced after some conferences here and there would lead ultimately into a similar situation to the one that you feared might exist in the States if an individual were given the right to appeal to a State court for review.

1 wonder if I have properly analyzed that relationship or if you see it in somewhat the same light?

Mr. ERICKSON. Why, I think I see it just as you do, Mr. Priest. There is that danger that there will be a multiplicity of litigation, and there will be delays of one kind or another.

At the same time, there has been a great deal of consideration given in the Senate committee as they were studying the bill, and I think that, as the result of experience, it would be possible to work out to the satisfaction of most hospital organizations under S. 191 as it presently stands.

I am fearful of the delay.

Mr. PRIEST. I am very much of the opinion-I was not here yesterday during the discussion of this proposal for appeal within the States, but I am very much interested in that whole subject, because I think it is very vital to the proper administration of this bill.