The CHAIRMAN. Mr. King will inquire. Mr. KING. Mr. Secretary, as you have stated, there is much more you could have said in your statement, which in my opinion was an excellent one. There are a number of questions I am going to ask, but they do not represent all that could be asked. But I want to inquire of you first: I know your views on this subject, but I think that it would be proper to have it on the record early, because of the multitude of letters I have received, principally from members of the medical profession throughout the entire country. It seems that it is possible, at least, that the great majority of the members of the profession who have written to me have been convinced that this plan represents socialized medicine. Now I label the allegations "Specious." The thing that surprises me is that it is quite evident from the correspondence I have received that the bill has not been read by those who have written. It is quite evident that statements of your own and others on the subject have not been read, or, if read, certainly not understood. I would like you to repeat what I have heard you say before for this record. Secretary RIBICOFF. Well, first, let me say this. It is my opinion that while the AMA has done the American people a disservice, they have done the individual members of the AMA a greater disservice, because they have misled their own membership. They have not told their members the truth. Through a series of advertisements throughout the Nation they have tried to mislead the American people. Apparently anything the AMA does not like, in their opinion, is socialized medicine. If you go back into the history of the AMA's position, you will find that social security was "socialization." The disability insurance provisions were "socialization." Blue Cross, when it was first advocated, was "socialization." This bill has been carefully drawn. I myself carefully reviewed it to make sure that it contained no element that could be even indirectly interpreted as socialization. What is socialization of medicine? If the Government owned the hospitals, if the Government paid the doctors and the doctors worked for the Government, that would be socialization. Under this bill, the hospitals would not be owned by the Government. The doctors are specifically excluded from this bill. This bill does not provide medical care, health care, hospital care, or nursing home care. This bill provides the method to pay for the care under the social security system. There is absolutely nothing in this bill that is socialization. It is a bogeyman that the AMA seeks to scare the American people with, and it is my opinion that the American people are too intelligent to be taken in by the AMA. Mr. KING. Mr. Secretary, I have been prone to make comparisons, as one will, when seeking for a respectful reply to correspondence. On the subject of socialism, as I interpret it, and as the dictionary defines it, would not the medical assistance program approved by the Congress in the last session be a little nearer in approach to socialism than the present bill under consideration? Secretary RIBICOFF. I do not think there is any question about it, because the bill that this last Congress passed provides for the payment of doctors. Doctor bills are covered. That bill provides, out of general revenues, for the State and the Federal Governments to make substantial contributions for the payment of the medical care of a large class of American people. This bill has the saving grace-and I am very serious when I say this that it is conservative. This bill is the most conservative approach, because under this bill, the beneficiaries make the contributions, with their employers, to pay for the benefits. They are paying for what they are getting, instead of having the general treasury of the State and the Nation under an open-end proposition make the payment. There could be nothing as deadly and as devastating to the future financial position of our States and the Federal Government than if we were to carry out to the end the potential commitments of the bill that the Congress passed last year, because the Federal Government on an open-end basis has to match whatever the States do. Now, what does this lead to? I have been in politics. I have been in the State legislature. I have been a Member of Congress. I have been a Governor. And I am now a Secretary. A few States have formulated a program under the so-called Kerr-Mills approach. Let me predict, on the basis of my political experience, what is going to happen. You know, the toughest thing to find in politics is an issue. And there is competition for issues. And issues have a way of generating and snowballing as they develop. A State passes a bill under the so-called Kerr-Mills approach, and the bill covers only single people with a maximum income of $1,000 and couples with up to $1,800. Then there is the next State convention. The Democrats and the Republicans meet, and they want an issue, because they want to win. There are 1734 million old people over the age of 65. How are we going to get their votes? So the Democratic Party says: "We will raise the ante. We will make it $1,500 and $3,000." Then the Republican State convention meets, and they say: "Well, this is bad. The Democrats have a good issue. They are holding something out to the voters. We are now going to raise it to $2,000 and $4,000." Then the legislature meets, and the Governor sends a program to the legislature. And the legislature sits, and if the Governor is the opposite party, "We are looking for an advantage," says the legislature. So hearings are held. The legislature raises the Governor's program. Gentlemen, you have got a mechanism in the bill that you passed that could really ruin this country. You could open up to fantastic limits the pressures on each individual State. You have passed a bill that gives a blank check to every State legislature on open-end appropriations. Mr. KING. Yet, Mr. Secretary, I think most people will agree, if we are going to pick approaches to socialism, the medical profession generally is defending the medical assistance program passed in the last session. It is rare that one letter I have received does not cite that act as satisfactory and good. And in many instances, they have been told, evidently, that as of April 1961 some 46 States are putting into operation this medical assistance program that the Congress passed last session. Secretary RIBICOFF. Well, I would say that the AMA is loose with the facts, to put it as mildly as I can. As of July 17, the latest figures we have, there are now 10 States and 2 territories with programs now in effect under the bill that you passed. Plans have been submitted, but are not yet in effect in three States. Legislation has been enacted, but plans have not been submitted for approval, in eight States. Now, let us asume that laws enacted and plans submitted will all be approved. You could say that within the next year you might have a total of 23 States and territories with programs in effect-in 23 States there is legislation in process to give the basis for a program or to provide appropriations. In seven States legislation has passed one house of the legislature, but nothing has become law yet. Three States are considering legislation, with nothing done; 18 State legislatures have adjourned without taking any action at all. How, based on these statistics, you can say 46 States have put programs into effect is beyond me. And I would like to make a part of the record the detailed breakdown and the names of the States that are involved here. The CHAIRMAN. Without objection, that material will also be included in the record. (The breakdown referred to follows:) SPECIAL WEEKLY REPORT, JULY 17, 1961-ACTIVITIES OF THE 54 JURISDICTIONS TO PUT INTO EFFECT THE NEW PROGRAM OF MEDICAL ASSISTANCE FOR THE AGED Arkansas 2 Oregon (effective November 1, 1961) Utah (July) North Dakota (effective July 1, 1961) (in regional office) C. Legislation enacted; plan not yet submitted (eight States): California (effective January 1, 1962) Connecticut (effective April 1, 1962) Hawaii Louisiana Maine (effective July 1, 1961) New Hampshire (effective October 1, South Carolina (effective July 1, 1961) D. Legislation in process to give basis for program or to provide appropriation (seven States): 1 Plans of these States are approved, except New York, Utah, and Idaho. 3 Intermittently in session; summer recess began June 2. 'Effective date postponed by State until funds are available. E. Considering possible action by legislature (3 States): F. Need legislation; no action is anticipated in 1961 (18 States): Guam G. Have authority for MAA; not expected to implement in 1961-62; legislature adjourned (three States): Georgia: Enacted 1961; no funds available. New Mexico: Plan withdrawn; no appropriation. DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, BUREAU OF PUBLIC ASSISTANCE, Mr. KING. I do not like, Mr. Chairman, to deal with what Congress has done in the past, but I am doing so before the citizenry of the country to provide the opportunity at least for facts. Most of the members of this committee approved that medical assistance program last year, and it might concern some people as to why, in view of what has been said about it, it was approved. Some method must be found, of course, and that method appeared to be the best under the circumstances at the time, for taking care of the hundreds of thousands of older people in the country who would not be eligible under the current plan under consideration. So, using the term "stop gap," or providing for that element in the population, it could complement and go along with this proposal, if it is to be enacted. Is that not true? Secretary RIBICOFF. That is true. I would say that Congress did take a step forward. And we are doing everything in our Department to encourage the States to go along with the approach of 1960, because, to the extent it reaches the number of people it does, it is better than nothing. But I think the reason it is not the answer is that the problem of medical care for the aged is not just the problem of those on welfare or the medically indigent. The problem has the greatest impact on the great mass of self-respecting Americans who work hard all their lives, who do not want something for nothing, who do not want the Government to pick up their tab, who do not want to be on relief, who want to pay their own way, who do not want to have a life of hard work and self-respect and dignity suddenly disintegrate in the face of these unusually large expenses that come to a majority of Americans in their old age. And while what was done last year was definitely a step forward, it is not a step that is going to do the whole job of taking care of the health needs of aged Americans. Do not have in operation vendor payment for medical care in OAA. 5 Except introduction of proposed constitutional amendment for future MAA program. Mr. KING. Is it not a reasonable expectation with the men in the Department that as time goes on the recipients under the medical assistance program, in numbers, will be lessened, year after year? Secretary RIBICOFF. I think that is true; because as more go on social security and more receive benefits, there will be fewer under the medical assistance and the public assistance programs. Mr. KING. Some people have said the medical assistance plan is preferable to the plan under the present bill, for the reason that more wealthy people, who do not need this check, will participate or enjoy it. Secretary RIBICOFF. As this committee ought to know better than anyone, the wealthy people are taken care of pretty well right now. I hear the argument that a millionaire does not need this assistance. Well, if you are a millionaire and in the 90 percent tax bracket, and if you are 65 years or over, your medical costs do not even have to exceed 3 percent of income before they are tax deductible. You can deduct medical expenses from the first dollar. If you are an aged person of substantial means, and you are in the high tax bracket, you get full tax credit for your medical expenses, so the Government is paying 90 percent of them. So when you talk about the wealthy people not needing it, you should remember that the wealthy people do pretty well with their medical expenses under income tax laws. Mr. KING. What assistance has the Department had from the AMA or the American Hospital Association in connection with the drafting of the bill? Secretary RIBICOFF. I do not think the AMA has given us much assistance, although the bill was shown to representatives of the AMA before it was submitted. The American Hospital Association, not only on this draft, but prior to my becoming Secretary, had been consulted frequently by the Department on various phases, to make sure that the definitions, the programs, the methods, and the conditions would be workable. We have the highest respect for the American Hospital Association and they have been very helpful from time to time. We would always look to the American Hospital Association for advice in a program such as this, sir. Mr. KING. It has always been widely circulated that the bill under consideration is not equitable for the reason that ever so many older persons will benefit who have not paid or have not paid sufficiently, and it mitigates against the younger element of the population. Secretary RIBICOFF. If you pass this bill, immediately some 14million odd over the age of 65 who now draw social security would be beneficiaries. I think that this committee, when it has increased benefits from time to time, has always included existing beneficiaries even though they make no further contributions. My feeling is that the younger people do not object. This is social security. Younger people know that they are building up for their future. Younger people do have fathers and mothers who when they are sick have to go to the children for assistance. It is my opinion that this is one of the most popular approaches in America. The people who work for a living overwhelmingly would be willing to contribute their one-quarter of I percent from payroll to |