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These out-of-pocket costs apparently had little influence on other spending habits. In the vast majority of cases, these respondents did not put off buying anything because of the costs of medical care. The percentage who did put of other purchases (including other medical treatments) declined slightly after July 1, 1966.

It is, of course, too early to make any generalizations about these data, but it would appear that the trends are in the direction of a successful program even if the magnitude of change is rather small.

PROVISION OF HEALTH SERVICES IN THE COMMUNITY Since no data are yet available on the community analysis phase of this research project, the most I can do at this point is to describe what we hope to gain from such an analysis. Basically, this will be a study of (1) provision of various health services by community resources both before and after Medicare (mostly from records), (2) decision-making process in planning and coordinating the delivery of these services, including an evaluation of the role played by influential groups such as the local medical society, hospital associations, and voluntary agencies; and (3) the subsequent reorganization of health care services for the aged. Again the primary reference point will be Medicare although other programs presently operating and planned such as Medicaid will have to be considered also.

We have hypothesized that over the next few years the demand for health services by the aged will gradually and steadily increase although a "leveling off" should occur within roughly ten years. In response to this increasing demand, community resources will likely expand their facilities, both in terms of physical plants and scope of services. Expansion, however, takes time, money and person. nel ; thus, we predict that the initial response to increased demand will probably be a reallocation of present resources to meet immediate demands and at the expense of other presently offered services. For example, small, rural hospitals can provide essentially custodial services for elderly patients, but only at the cost of reduced provision of acute care services. Similarly, physicians who see an increasing number of older patients, necessarily will have to see fewer younger ones.

Because of the inability to readily expand their services now and because of the general shortage of trained medical personnel at all levels, we are hypothesizing that communities will be more or less compelled to engage in a coordinative effort to allocate their resources. In so doing, we expect (eventually) that there will likely be a substantial change in the organization of a community's health services.

The factors which will likely contribute to this “reorganization" are many and varied and, for the most part, are extensions of the processes which characterized the development of the 20th century medicine. Increased population size, rising standard of living, new drugs and medical techniques, new discoveries, etc., will promote increased longevity, emphasize management of chronic diseases, and further the specialization of the medical and paramedical professions. These, in turn, should subsuently require more personnel, increased "team effort" to provide for an extended concept of truly (omprehensive care.

If, in fact, these things do occur, we would anticipate an increasing rate of growth of group practices, perhaps a further decline in the percentage of physicians in strictly private practice, the emergence of specially trained groups whose main task is to coordinate all these services.

These anticipated changes obviously involve some threat to present principles guiding health care delivery systems. Thus, initially we would anticipate some resistance to these changes. Potentially, physicians offer the most serious threat to successful development of the program not because they might refuse to cooperate or to treat patients whose care is subsidized. Rather the danger lies in physicians' attitudes toward aging as a process and related beliefs about medical management of long-term illnesses. The Medical Care Research Center is presently conducting a national survey on this topic. Results from the pilot study show clearly the relationship between the perception of aging as a “process of irreversible biological deterioration" and a tendency to recommend palliative or custodial care for the elderly. Thus, physicians may be reluctant to participate because they see no medical purpose to be served by extended health services.

Another source of resistance is, of course, the facilities themselves. In most communities there is still a spirit of competition for staff, for patients and

for community support. As a result, there is a very great reluctance on the part of these organizations to submit to the coordinative efforts of voluntary groups (even when they each have representation in that group).

Finally, but certainly not exhaustively, the patients themselves may not make full use of the facilities offered. For example, we have already noted a rather unfavorable attitude toward nursing homes-to be used only as a last resort. Reports from other studies clearly show that a host of socio-cultural, psychological and economic factors strongly influence a person's decision to use not use some health resource. It seems evident that these changes will be slow in coming about, but, we feel, they must eventually occur.

RELATED ISSUES TO BE EXPLORED

As indicated in the preceding paragraphs, the major thrust of this research is on utilization and provision of community health resources. In the process, an opportunity arises to confront several related and important issues. In closing, I would like to make brief mention of only two of these. First is the effect of Medicare on the quality of medical care services for the elderly. This problem is viewed not in the sense of quality of technical services by a particular physician, but rather in the context of type of care rendered and increased scope of care. It seems reasonable that Medicare could lead a patient to seek a physician's care almost exclusively. That is, older people with health problems which they typically treat themselves, or consult with a spiritual healer or a chiropractor, may now consult with a physician who is eligible to receive payments for services rendered.

The rising demand for management of chronic problems may eventually lead to a reorientation of the medical profession in which chronic care is given equal status with acute care. If so, there should be a subsequent shift from a custodial orientation to a treatment orientation in dealing with patients with chronic disease problems.

It is also possible that increased contacts with physicians and more frequent treatment may actually improve the health status of the aged. Under these conditions, it is feasible that preventive medicine, especially preventive maintenance services for the aged will assume new importance an importance at least equal to preventive services for communicable diseases.

Finally, the quality of care is affected also by the scope of service provided. We would expect there to be an extension of services under the concept of "comprehensive care.” The management of chronic diseases calls for the specialized, technical competencies of several persons and in a variety of settings and as the need arises, it is likely that these services will be developed and expanded.

The second, related issue is more difficult to assess and it has to do with the basic philosophy or ideology underlying the provision of health services and modes for paying for them. Basically, we suppose that in the long run, the positive attributes of Medicare will outweigh its shortcomings and this should go a long way toward undermining the customary arguments about subsidized programs particularly those related to mode of payment. It does not seem too far-fetched to expect that ultimately all age groups will be fully covered by some form of insurance. Medicare (and Medicaid) represent initial steps in this direction.

Senator SMATHERS. Doctor, do you want to say something?

The American Medical Association has had Dr. Anderson here today as an observer and they were going to testify but they are otherwise occupied at the moment, and have offered to give their testimony at a later date.

Blue Cross Association, Mr. James Ensign, vice president, and Mr. Walter J. McNerney, president, have indicated that they will probably testify tomorrow.

If there is no other business to come before the subcommittee at this time, we stand in recess until tomorrow morning at 8:30 a.m.

(Whereupon, at 11:50 a.m., the subcommittee recessed, to reconvene at 8:30 a.m., Friday, June 23, 1967.)

COSTS AND DELIVERY OF HEALTH SERVICES

TO OLDER AMERICANS

1

FRIDAY, JUNE 23, 1967

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

Washington, D.C.
The subcommittee met at 8:10 a.m., pursuant to recess, in room 1318,
Senate Office Building, Senator Walter F. Mondale presiding.
Present: Senators Mondale and Williams.

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

Senator MONDALE. This morning we have an interesting panel on Organizational Deficiencies in Present Health Services. We are privileged to have Dr. George James, dean of Mount Sinai School of Medicine, New York City, and Dr. Milton I. Roemer, professor, School of Public Health, University of California, Los Angeles. If you will both come up to the table, please. Dr. James, you may start. STATEMENTS OF GEORGE JAMES, M.D., DEAN, MOUNT SINAI SCHOOL

OF MEDICINE, NEW YORK CITY, AND MILTON I. ROEMER, M.D., PROFESSOR, SCHOOL OF PUBLIC HEALTH, UNIVERSITY OF CALIFORNIA, LOS ANGELES Senator MONDALE. I understand you got a 7 a.m. plane from New York City this morning. If you would like to use 5 minutes to attack the shuttle service, we would be delighted to have that a part of the record and I will add in my own comments.

Dr. James. Thank you. It is sometimes easier to get to Washington from my office in Long Island than to the office in New York City.

Senator MONDALE. Without any doubt you may have seen Art Buchwald's column a few weeks ago where the newly developed SST had a race with the Queen Mary to see who could get to Paris first. The SST beat the Queen Mary by about 3 hours. Go ahead. Dr. JAMES. My name is Dr. George James. For the past 20 months I have been dean of a new developing medical school in New York City. For 25 years before that I have held various governmental public health positions in State and local health departments culminating in 3 years as commissioner of health of New York City. Recently I have been Chairman of the President's Task Force on Health and President of the National Health Council. I serve now as chairman of the Review Committee for Regional Medical Programs and on one of the subcommittees of the National Advisory Committee on Health Manpower. This August I will be chairman of the National Conference on Public Health Training.

The health problems of the aged are among the most complex and difficult now facing the American people. The entire scope of disease can be visualized as a continuum composed of four stages. The first stage is concerned with risk factors which operate before disease begins. Ideally this is the best time to intervene and interrupt the beginning of the disease process. This is the time when we seek to modify health habits and adjust the environment to make our people less susceptible to the risk of disease.

The second stage is involved with that period during which the disease process has begun, but the patient as yet has no symptoms. By means of various detection tests we seek to discover the early manifestations of disease and interrupt their further development.

Much additional research and program development is required before we can say that we understand how to combat our present major killers and disablers. Useful hearings have been conducted by congressional committees which have highlighted those problems and suggested certain productive areas for attack.

The third stage of disease is the clinical period when the patient generally feels ill and demands medical care aimed at cure. This has always made up the bulk of medical care and has been the major focus of much of our recent medical care legislation.

The fourth stage is the chronic period. Here our patient can no longer expect cure, but rather hopes for a limitation on his disability. At best this means rehabilitation, but at least it means a readjustment of the patient and his environment so that he can maintain a maximum of self-sufficiency, family life, and human dignity for as long as possible. It is what has been called adding life to our years instead of the more biological goal of adding years to our life.

NEW YORK CITY AGING BY 20,000 YEARLY The growth of our aged population, particularly in our rapidly expanding urban areas, is truly remarkable. New York City, with a fairly stable total population size, is aging by 20,000 persons per year. By 1970 we expect to have 1 million persons over the age of 65, making New York's aged the sixth largest city in the United States. A recent survey in New York City indicated that about 100,000 persons are fit candidates for rehabilitation for neuromuscular disease. Our present methods of caring for such people are ill-adapted to meeting this problem. We cannot continue to rely upon institutionalization and facility-bound services to meet these needs. We simply cannot afford either the time or money to build institutions for them. Nor are these institutional programs the answer, even if we could provide them.

Let me illustrate by describing for you one of my recent patients.

He is a man aged 78, who has the following pathological conditions: carcinoma of the larynx involving a tracheotomy and oesophageal speech, hypertrophy of the prostate with some pyelonephritis, diverti

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