ing to the doctor when symptoms first occur. By encouraging preventive medicine it would tend to hold down total medical costs as well as to avoid illness and premature death. It would avoid a means test, paying benefits as a matter of right and relating contributions to income. We suspect that the aristocracy of the medical societies object particularly to the fact that under national health insurance the people, through their Government, would have something to say about the charges of the doctors who elect to cooperate with the program. Yet there are few essential services today about which people now have so little to say as the cost of medical care. Often they do not know the price they are to pay until the doctor's bill is received. If a union has a medical service plan it would continue to function under national health insurance, and its cost would be met out of the national fund. The same would be true of many other voluntary nonprofit plans. Doctors, dentists, and nurses, who have licenses to practice in a State are guaranteed the right to do so under the insurance system. They would be relieved of the bother of collecting bills and would be sure of being paid. Doctors would continue to have the right to refuse services to those they do not wish to treat. The doctors in each community would decide by majority vote on the method of payment for their services, but individual doctors who preferred another method could also arrange to be paid as they wished. Physicians could run offices by themselves or join in group practice. They could be paid by various methods, so much a visit, called fee for service, or so much a month or year for each person on their list of patients, on a full-time or part-time salary, or by some combination of these methods. I took part in a meeting with a medical society in Summitt County, and one of the objections that they raised to our request that they consider our medical schedule or our surgical schedule as full payment was that that in a sense would be putting them on a salary basis, and I just could not understand that type of criticism of the suggestion that we made, particularly since I happen to work and happen to represent workers in a piecework industry where we are paid by the piece, not by the hour or not on salary. The program would be nationwide so that a worker's family would be covered whether or not he moved to another State. A national system is better than State systems because it gives this coverage and because it helps bring adequate and modern medical care to people throughout the Nation. Health is not a local or State problem primarily. Germs work in the same way in the South or North, and they don't pay any attention to State lines. Epidemics sweep the Nation and the world, and must be fought by the same methods in the East or West. Only the National Government can plan effectively for efficient development and use of medical facilities. It needs the cooperation of the States, but it must not abdicate to them. With a national system a worker who lived near a State border could go to a doctor in a community across the State line, if that were more convenient or he liked the doctor better than any in his hometown. If he really needed it, a worker could get special care and treatment anywhere in the country that there was a doctor or a hospital well equipped to give such treatment. At the same time this program would make it possible for doctors everywhere in the United States to keep up to date with medical progress. The poorer States need the most medical care, yet have the fewest hospitals and doctors. With a national system of insurance, doctors, nurses, and dentists, even in the poorer States, could make a good living, and have modern hospitals, and keep on learning. In time, the quality and quantity of medical care any worker could get 'for himself and his family would not depend on where he lived or what he could pay, but only on whether he needed it. A national system costs less than separate State systems. And if we don't have a national system we're not likely to have much of a program. A few States might act, but most wouldn't or couldn't. Each State will be afraid of putting its employers at a disadvantage as compared to employers in other States, and so they won't want to ask employees to contribute to the insurance fund. Experience with unemployment compensation, where the Federal Government sees that all the States have programs, but where the States set standards for benefits and disqualifications, has shown workers the difficulties, inadequacies, and confusion of State systems. That doesn't mean there won't be really local administration. The bill provides that there must be local advisory committees in every community; workers would be represented on these committees and could advise on running the program. If you are not willing to recommend national health insurance at this time we urge that you pass other measures which would at least move substantially in the direction of our goals. The following are specific proposals that have long been before Congress which should now be acted upon: An aid to medical education bill so that we may have more doctors, nurses, and other medical personnel. Aid to State and local public health service units, so all communities may have reasonably adequate public health services. Larger sums for medical research. Larger appropriations for construction of hospitals and other medical facilities. The full $150 million authorized by the Hill-Burton Act should be appropriated each year. We regret that your committee, following the recommendations of the administration, has proposed only $50 million for this purpose, in addition to the $62 million suggested with amendments to earmark funds for certain types of establishments. Increased aid to maternal and child health services and expansion of the program for the physically handicapped children. More generous provisions for mental health activities, including improvement of our mental hospitals and clinics, and expanded training of psychiatrists and other mental health personnel. I had the opportunity of going through the Menninger Foundation in Topeka, Kans., last weekend, and if you have not had the opportunity of visiting that foundation, or if you have not had the testimony of Dr. Menninger, I would think it would be certainly well worth the time it would take the committee to get that information. They are doing a wonderful job, but it is entirely inadequate. Increased rehabilitation services on a permanent basis for those that become disabled each year. A balanced program of grants and loans to aid the development of voluntary health insurance plans. We place this item last not because it is least important but because it is only part of the general program and because we now want to discuss bills on this subject in more detail. H. R. 8356, the health service prepayment plan reinsurance bill. The stated purpose of this bill reveals an understanding on the part of the administration as to the nature of the problem we face: To make "good and comprehensive health services generally accessible on reasonable terms, through adequate health service prepayment plans to the maximum amount of people." Upon examination of the bill's provision, however, we believe that this bill will not accomplish this purpose. It has never been demonstrated in any serious study or discussion of the health problems of the United States that Federal reinsurance would solve the Nation's medical needs. Upon analysis of the proposed reinsurance program it is possible to understand why. We believe there are two criteria valid for judging this program. 1. To what extent will it help to bring about prepaid comprehensive medical care programs which will provide preventive, diagnostic treatment and rehabilitative care for the American people? The central obstancy to developing such programs is lack of money. Funds are needed to build facilities and to finance operations during the early development of such programs. But the administration's insurance proposal does not provide any Federal money for these purposes. We believe, as we shall explain later, that Federal funds should be made available to organizations interested in developing truly comprehensive care on a prepayment basis. A reinsurance system cannot, by its very nature, meet this challenge. The money which is available comes from the organizations themselves. It is available at best for 1 or 2 years. No carrier will be helped to take risks by a grant of money from the Government. He will merely have his losses cut for a limited period if he ventures into new risk territory. In the long run all the carriers who buy the insurance will have to pay the bill for the risks they assume. Federal subsidies are much more to the point. If reinsurance was the solution then the private insurance industry would have adopted its own reinsurance program for this area. The real problem is the industry's unwillingness to enter into these comprehensive types of programs, or their inability to provide them at a cost attractive to purchasers. Many insurance companies will not even write a comprehensive program for hospitalization. We had considerable trouble in getting insurance companies to cover the types of insurance programs which we negotiated in the rubber industry, and there was considerable pressure exerted by both the rubber companies and by our union in order to get them to carry them. There are not too many of them that were willing to take the programs which we had negotiated. Rather than seek ways to extend their programs by removing cash limits and exclusions, insurance carriers, both commercial and nonprofit, are turning toward further restrictions. Deductible and co insurance features are the newest methods for making the purchaser bear part of the cost so he receives less protection. It is apparent from testimony given by previous witnesses at these hearings, representing insurance companies and nonprofit plans, that the existence of a reinsurance program will not strengthen their ability or willingness to broaden the range of protection which they will offer. While we condemn the do-nothing attitude which has been displayed by some of these earlier witnesses, we consider their statements are important as indications of the ineffectiveness of the proposed reinsurance program. While it is recognized that certain agencies and organizations have testified in favor of this reinsurance program, even those who claim it will be useful may not take advantage of its provisions. 3 Some have stated that a reinsurance program might stimulate further development of the major medical or catastrophic insurances. This may be so. However, we do not regard such insurance as a forward step to the solution of our health problem. Truly comprehensive protection, with emphasis on early disease detection and preventive medicine, is far more socially desirable. It will also not only take care of the so-called catastrophic cases but reduce their number. 2. To what extent will this bill help to bring comprehensive protection within the reach of people who cannot now afford such protection? We fail to see how this bill will extend coverage to the so-called difficult sections of our population, the aged, the unemployed, the medically indigent, the chronically ill. The bill will not make available any additional money to extend voluntary health insurance to any people who cannot afford to pay premiums. In the experience of our unions there has been little demonstration of the ability of a voluntary system to accommodate these difficult groups. 3 We do not favor passage of the reinsurance bill because it will not help to solve the Nation's health problems. We urge that you recommend instead a Federal program for aiding voluntary health plans through (1) mortgage-loan insurance, (2) direct Federal loans, and (3) Federal grants. We shall deal with each of these in turn. H. R. 7700, the mortgage loan insurance bill. We accept the bill in principle because we believe that it will probably encourage the organization of prepayment medical care and hospital plans, group medical practice, ad the building of medical facilities. It is by no means enough as a program of aid to voluntary plans, but it is a slight forward step that will apparently aid certain ones. Certain suggestions for improving the bill were recently presented to the Senate Subcommittee on Health on behalf of the CIO by Dr. Morris Brand, medical director of the Sidney Hillman Health Center in New York, who testified in January before your committee. Ι am appending for your consideration this part of his Senate testi mony. Mr. Chairman, I will appreciate if you will put that into the record as part of my testimony. The CHAIRMAN. Do you wish it at this point or at the end? The CHAIRMAN. Very well. That will be done. Mr. CHILDS. H. R. 6950, the Federal loan bill for nonprofit associations: Direct Federal loans at low interest rates will be more effective in promoting the growth of group practice prepayment plans. While the mortgage insurance bill may be of help, a plan in a certain locality might be unable to obtain a loan from a private source even if the bill passes. Private lenders might not be found on acceptable terms. The more capital the plan can buy for a given amount of money the more rapidly the plan can expand with reasonable charges. The rate of interest is therefore of crucial importance, and the Federal Government can make money available at lower rates than can private lenders. We approve the respects in which this bill defines eligible nonprofit associations more broadly than the Humphrey bill in the Senate. We suggest that you increase authorized amounts to $10 million instead of the present $5 million in each of the first 2 years, and that you authorize thereafter whatever amounts may be found necessary. Federal grants to nonprofit plans: We recommend that you endorse a program of Federal grants to nonprofit medical care plans so as to enable them to experiment with overcoming their important limitations. We suggest that you authorize the use of $25 million a year for such practical pilot studies. The grants should be made especially for the purpose of experimentation with overcoming (1) the failure of voluntary plans to provide comprehensive services, and, (2) their difficulty in reaching low-income groups. Experimentation might also cover such matters as (1) removing waiting periods, and limitations against age, sex, race, and preexisting conditions, (2) eliminating deductible features, and (3) providing psychiatric treatment. It should be understood that the grants would have to be made for a period of more than 1 year in order for the plans to be able to make experiments. The sum of 5 million is small compared to needs, but would at least provide a starting point and add to our knowledge of problems and solutions. It would clarify the degree to which voluntary plans can in fact overcome their present limitations. The information provided would be worth many times the value of the sum expended. These experiments should be approved by a national advisory council and administered through the United States Public Health Service. We should like to stress that any advisory council established in connection with health programs should have adequate representation of consumers. In closing we again urge that you give more weight to needs than to costs. Much of the expenditure would actually result in great savings, not only in human lives but in dollar figures. A tremendous loss to the Nation occurs each year as a result of disability. This was stressed by the President's Commission on the Health Needs of the Nation. Its staff stated that- the loss to the economy arising out of disability has been estimated as between $34 billion and $60 billion during 1951. This can be compared with a national income of $278 billion. |