H.R. 6418-PROPOSED AMENDMENTS

Section 353 (i) of H.R. 6418 is amended to read as follows: "(i) The provisions of this section shall not apply to

(1) any clinical laboratory operated by a licensed physician, osteopath, dentist, or podiatrist who performs laboratory tests or procedures, personally or through his employees―

(a) solely as an adjunct to the treatment of his own patients, or (b) where such tests or procedures are made or used for insurance purposes;

(2) any clinical laboratory maintained by insurers or to any tests or procedures made or used for insurance purposes."

Mr. STUCKEY. Thank you, Mr. Ennes. You are to be commended for the approach that HiCHAP has taken with the governments of various States.

How has your program been received? I notice you stated have a HiCHAP coordinator in each State.

Mr. ENNES. Yes, sir.

Mr. STUCKEY. What is the reception?

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Mr. ENNES. Excellent. A couple of weeks ago in Chicago we had representation from a wide segment of professional voluntary and the governmental health community. I am very happy to say that I think we are building a fine working relationship and understanding, that our commitment in this field and our concern about it is very truly in the sense of doing the best we can possibly do to protect the interests of the people who need the services.

There is beginning to be a recognition that we have talent, experience, and understanding that can be brought to bear in this field.

We are ready to do that. We have already had requests from a good many Governors for participation and assistance. We are involved in a good many of the areawide planning agencies. We stand ready to help to do this job the best we can.

Mr. STUCKEY. We thank you for your statement, and your devotion to this problem, which has been so well received.

Mr. ENNES. Thank you, sir,

The CHAIRMAN. Mr. Ennes, I, too, want to congratulate you for coming to give us the benefit of your views. I did not get to hear all of your statement, but I did read the summation of it. I am glad to see that you endorse the council concept.

Mr. ENNES. Surely.

The CHAIRMAN. I believe this strengthens the bill.

I want to thank you. I have no questions.

Mr. Keith.

Mr. KEITH. Thank you, Mr. Chairman.

It is good to see the insurance companies playing such a positive role. I think Equitable has consistently done such a role in measures of this sort. I can recall back in about 1946 when President Parkinson announced that the Equitable was making a grant of $30,000 to help research for heart disease. This cooperative effort is an indication of the continued consciousness of the life insurance and health insurance industry. I only wish you had played a more positive role in the question of medicare some years ago. I think we might have had much better legislation and much sooner if the insurance companies had taken that position.

I look forward to your statement on section 5. I note section 353, under section 5, I would invite your attention to the fact that a laboratory means a facility for the biological or other examination of materials, or the assessment of the health of man. It seems to me that is quite broad in scope, something which should be studied by this committee, as it has indicated it would.

I have no further questions, Mr. Chairman.

Mr. STUCKEY (presiding). Mr. Kyros.

Mr. KYROS. Thank you.

Mr. Ennes, I also want to commend you on your excellent testimony in support of this legislation. I would like to note, coming from the State of Maine, that no one on the Community Health Planning Committee, none of the 25 executives include anyone from the mighty Union Mutual Insurance Co. Do you know why such an absence occurred?

Mr. ENNES. I cannot explain that, but I can tell you that the Union Mutual has been very active in Maine and at our meeting in Chicago that I referred to a moment ago. There were at least two representatives of the company present, who we are working with very carefully, and we have also had discussions with the Governor and the department of health and welfare already in connection with this.

Mr. KYROS. I am delighted to hear that.

Thank you, Mr. Chairman.

Mr. STUCKEY. Dr. Carter.

Mr. CARTER. I also was pleased with the presentation.

Our insurance companies certainly have terrific salesmen and an abundance, evidently, of managerial talent. I understood that there was a little difficulty in spite of all the smoothness and splendor of the speech, with some disagreement about the laboratories. Is that true? Mr. ENNES. I think I indicated that we would like to have the opportunity to put a statement before you. I am personally not qualified to comment on that. I think it is apparent that this is a major problem. I suspect there has not been clear understanding of some of the implications of this in terms of underwriting, in terms of assessment for issuance of life insurance in particular, which is neither a matter of diagnosis or of treatment, and which has behind it the very powerful motivation on the part of the individual who wishes to understand as well as possible and get as adequate coverage as possible, the commitment and the interest of the insurer in making sure there are no hidden problems that will underline the economic commitment that we are making to that individual.

Everything points in the direction of our being concerned with the highest possible quality of information from the clinical laboratory staff or any other staff.

Mr. CARTER. I don't want to trouble the waters at this point, but I understood there was some objection to the matter of laboratories. I think it is perhaps a valid one, by the way, in that it does constitute a problem for insurance companies. The specimens must be examined, but the question is whether in certain States it would be done under the Federal law or the State law.

The approach by such a group that might conduct such examinations might not always be favorable. To that extent, it does present

quite a problem. Federal regulation and Federal licensing of such groups may cause some difficulty.

I thank you for your wonderful statement. You are a master of the King's English.

I yield back the balance of my time, Mr. Chairman.

Mr. STUCKEY. Mr. Ennes, thank you again for your statement.
Mr. ENNES. Thank you, sir.

Mr. STUCKEY. The next witness will be Mr. Tom Robinson, who is accompanied by Mr. Vander Zee.

STATEMENT OF TOM ROBINSON, PRESIDENT, INTERNATIONAL SOCIETY OF CLINICAL LABORATORY TECHNOLOGISTS; ACCOMPANIED BY REIN J. VANDER ZEE, ATTORNEY

Mr. ROBINSON. Mr. Chairman and members of the Interstate and Foreign Commerce Committee. I would like to introduce Mr. Rein J. Vander Zee, our counsel.

My name is Tom Robinson, and I am the president of the International Society of Clinical Laboratory Technologists, an organization of clinical laboratory personnel with almost 3,000 members residing in all 50 of the United States. My home is in Tulsa, Okla., where I direct a clinical laboratory. Our society maintains its administrative offices at 805 Ambassador Building, St. Louis, Mo. Dr. Stanley Reitman, a practicing physician and a member of the accrediting commission of our society, who was to testify with me, had to return to St. Louis, Mo., and consequently will not be here today.

I have been personally active in the clinical laboratory as a technologist and a laboratory director for over 16 years and I was for 6 years chief laboratory technologist at the Oklahoma Osteopathic Hospital, Tulsa. Since 1957, I have operated the Robinson Laboratories in Tulsa. Dr. Reitman has been most active in the field of laboratory medicine for the past 12 years and has won international recognition as the codeveloper of one of the most widely used laboratory techniques, the Reitman-Franekl transaminase procedure. In addition, Dr. Reitman has been active in the training of laboratory personnel as the director of one of the oldest schools of medical laboratory technology in the United States, the Gradwohl School in St. Louis.

This afternoon we wish to testify on House bill No. 6418, limiting our testimony to that portion of the bill which pertains to clinical laboratory improvement. I am quite sure that you are all aware of the news stories of the past few months which point out the need for regulation in this vital health service field. However, we believe that certain fundamental concepts should be carefully considered by this committee so that the legislation which is enacted shall be meaningful and designed to provide a high degree of protection to the patient public.

We feel we must be frank with the committee in recognizing that a chaotic situation exists today in the clinical laboratory. We regretfully report that a great deal of this unfortunate situation has been financially motivated. In fact, the U.S. Department of Justice presently has an antitrust suit pending against the College of American Pathologists. We earnestly recommend that this committee secure a

copy of the Department of Justice's complaint in that case so that it might be studied in connection with this and other legislation which comes before you.

Our society has made every effort to work with representatives of organized medicine and the Department of HEW and yet, whenever we have asked the organized medical groups to establish standards and permit us to work with them in upgrading the profession, they have issued a blanket refusal. We feel that it is only through the efforts of the representatives of the public, such as the members of this committee and your counterparts in the various State legislatures, that we will begin to make the necessary improvements in the laboratory field.

First, we wish to emphasize that any regulations which cover the clinical laboratory (the four walls or physical plant), and perhaps the laboratory director, are entirely inadequate. It is the official policy of our organization, and my own personal conviction, that such limited regulations are not only insufficient but ineffective and that the only true public safeguard exists in insuring that the laboratory personnel at all levels are competent to do the work required of them.

To achieve this, we recommend one of two alternatives, the first being the licensing of laboratory personnel, that is, all individuals. who perform work in the laboratory, or, No. 2, to provide for the proficiency testing of laboratories as a unit.

Since we are discussing here today Federal legislation and since the Federal Government would probably be hesitant to go into licensing activities, we believe the second alternative would be the preferable in this situation. Furthermore, we feel that the legislation presently before you should not be passed merely as a type of enabling legislation but rather should establish specific qualifications and standards with specific provisions for their enforcement.

Enabling legislation which leaves it to an executive agency of the Government to establish qualifications can many times frustrate the original intention of the Congress or other legislative body. As a recent example of what can happen in this manner, we would point to the regulations propounded by the Department of HEW pursuant to the Medicare Act. As we pointed out before, the Department of Justice has an antitrust suit pending against the College of American Pathologists which alleges that the pathologists have created a monopoly in the clinical laboratory field. Despite the pending suit, we find that members of the defendant organization apparently enjoy a high degree of influence with the Department of HEW and when HEW drew up its regulations pursuant to medicare, these regulations actually assisted in perpetuating the monopoly that the Justice Department is attempting to break.

Therefore, we would most urgently ask this committee that no exemptions or exceptions be provided in this legislation and that all laboratories which come within the legislative scope of this proposed act be treated equally. We notice that an exception from this bill is provided in lines 21 through 23 on page 14 and lines 1 and 2 on page 15 for physicians, osteopaths, dentists, or podiatrists who perform laboratory tests "solely as an adjunct to the treatment of his own patients." We would ask the committee to reconsider the basis for this exemption since it would appear that such laboratory operations would not in

any event be in interstate commerce. Therefore, we would question the reason for such exemption.

Finally, to conclude my portion of this statement, I would like to reiterate to this committee that while is sounds good in theory to establish personnel standards for laboratory directors and thereby feel that this guarantees the quality of the performance of that laboratory, it simply does not happen in actual practice, particularly when there is no counterbalancing limitation placed on the number of laboratories to be supervised by that director.

The remainder of the testimony is Dr. Reitman's. I would like to read it.

"Mr. Chairman and members of this committee, I may add to what Mr. Robinson has stated pertaining to qualifications of directors of laboratories. As a physician with a special interest in the laboratory, I would like to emphasize that there are many laboratory disciplines where scientists who are not physicians are, in my opinion, eminently more qualified than physicians, including most pathologists. These scientists are highly qualified to be laboratory directors and should be recognized as such. In this connection, a provision in this legislation requiring proficiency testing of the laboratories without setting standards for laboratory directors and personnel would permit this recog

nition.

"Under the medicare regulations previously mentioned, there is a provision which allows an individual to direct as many laboratories as he can possibly put under his control. The provisions for private laboratories establish that a full-time director is limited to three laboratories unless he has an assistant director. An assistant director is likewise limited to three laboratories. Therefore, based upon these regulations, the laboratory director's only limitation on the number of laboratories he may direct is simply three times the number of assistant directors that he will be able to find, plus three.

"One of the most indefensible practices that we can cite is the itinerant or circuit riding director. We submit that it is physically impossible for any director to competently direct the activites of more than two or, at the most, three laboratores. Despite this fact, the medicare regulations just described perpetuate this loose practice which presents a greater danger to the health and welfare of the patient public.

"The city of New York has recognized this danger and has limited a director to two laboratories. Even so limited, a laboratory director cannot supervise each and every test performed in the laboratory. We think this fact, more than anything else, establishes the absolute necessity for requiring that the competence of laboratory personnel be established either, as we have said, through proficiency testing or individual licensing as the first step in assuring competent performance in the clinical laboratory. In other words, it is our feeling that in order to safeguard the public welfare, standards for laboratory personnel, as in almost all areas of human endeavor, must be built from the bottom up rather than from the top down.

"The medicare regulations established two categories of laboratory. workers, technologists and technicians, and anyone who has had experience in this field will find that the qualifications established for those two categories are identical to the training programs which are