In view of this position, we cannot favor either H. R. 6949 or S. 3114 unless considerably modified. In addition, a few other points about these bills are sufficiently important to warrant comment. H. R. 6949 requires that participating prepayment plans meet a number of conditions such as a sliding scale of premium structure, the provision of specified physician benefits and the contribution by a patient toward his daily hospital charge. We believe these rigid requirements, if accepted, would standardize prepayment plans in many undesirable ways. Moreover, we believe that most plans cannot or would not accept such conditions or participation. Our belief that this proposal is completely unfeasible is supported by the overt or implied opposition to it by spokesmen of all existing types of prepayment plans." S. 3114 suffers from somewhat the opposite kind of defect—an almost complete lack of definition of what would be done except for the vaguest generalities. The formulation of the program would, in all major essentials, be the responsibility of the Secretary of the Department of Health, Education, and Welfare. We believe it is the responsibility of the Congress to provide the administrator of a Federal program with a clear statement of the objectives and the guiding principles. This problem is intensified in this bill by the apparent conflict in the generalities as now stated: "In the fixing of premium rates (for the reinsurance the participating plans would purchase) regard shall be had to the objective of, on the one hand, making the reinsurance program self-sustaining over a reasonable term and, on the other hand, stimulating and encouraging plans which will promote the purposes and objectives" specified as extending coverage to new "classes of individuals," and to "new communities or areas," and to new "benefits and services." 18 The deterring factor to extending coverage is not the fear of incurring "abnormal losses and those in excess of anticipations" " for which the administration's proposal is designed but the inability of major segments of the population to meet out of their own resources and on a prepaid basis, the known and anticipated costs of comprehensive medical care. 19 We also wish to record our emphatic opposition to the inclusion of private insurance companies in the program. We believe that the Federal Government should maintain its past policy of providing assistance in the health field to nonprofit organizations only. We believe that the Federal Government should not aid organizations where the health needs of the people can come in conflict with profit-making motives. Two other pertinent proposals are receiving consideration by the Congress. One would establish a Federal long-term, low-interest loan program for the construction and equipping of facilities for nonprofit consumer controlled prepayment health plans. This proposal has been introduced into the Congress for a number of years by Senator Humphrey and in this session has also been introduced by Congressman Hagen and Wolverton: S. 1052 and H. R. 4593 and H. R. 6950. The second proposal would provide Federal mortgage insurance of private loans for the construction and equipping of facilities for group practice prepayment health plans. The most recent version of this proposal, H. R. 7700 is also sponsored by Mr. Wolverton. He has acknowledged the personal assistance of Henry J. Kaiser in redrafting this legislation, originally one of the four bills he introduced in January. The Physicians Forum favors the adoption of both these bills as they would be an important stimulus to prepayment plans which, based on group practice, could provide comprehensive service benefits efficiently and economically. It is clear, however, that these proposals are not designed to meet the economic problem of financing prepaid health care for the large number of people not now covered. The Physicians Forum recognizes the good intentions and desirable elements in a number of the more recently proposed Federal mechanisms for extending prepaid personal health services. However, we do not see how any one of them or a combination of them can effectively meet the health needs of the American people. We must, therefore, endorse our previous position that a universal program of prepaid personal health services as outlined in title VII of H. R. 1817 introduced by Mr. Dingell is essential. 17 Washington Report on the Medical Sciences, Nos. 345, 346, and 354; The AMA Washington Letter, Nos. 56 and 57. 18 S. 3114, 82d Cong., 2d sess., pp. 26-27. 19 U. S. Department of Health, Education, and Welfare, quoted in AMA Washington Newsletter No. 62, March 12, 1954, p. 3. Detailed reasons for supporting this Federal mechanism are contained in past policy statements and in testimony to congressional committees over the past decade. As these reasons are still valid, only a brief summary of them will be included here. The Physicians Forum favors the prepayment of personal health services through social-security contributions earmarked for this purpose. This broad base assures that sufficient money will be available to cover the cost of required medical care at all times for covered persons. This also makes it possible for each worker's contribution to be proportionate to his ability to pay. The general plan of administration assures decentralization and flexibility while, at the same time, maintaining adequate standards and promoting continuous improvement in the quality of care. The provision of comprehensive benefits will remove the economic barriers in doctor-patient relationships and make available for the first time to most people preventive medical services. The bill makes special provisions for group practice, which, where utilized, would offer important advantages to the recipients, more efficient, better integrated, and generally higher quality health services, and to the physicians increased professional satisfactions, greater financial security, and a more orderly mode of living. A universal program of prepaid personal health services will be most effective as a part of a comprehensive Federal approach to all major aspects of the country's health problems. The President's Commission on the Health Needs of the Nation has made a number of recommendations in all these areas. The Physicians Forum has advocated similar proposals for many years, and again would like to emphasize their importance, in particular the expansion of the HillBurton hospital-construction program, increased Federal support of medical research and public health activities, and establishment of a Federal-aid program in the field of education of health personnel. Only legislation embodying all these proposals can make possible an expanded and integrated national health program-one which will mobilize all the Nation's health resources and truly meet the health needs of the American people. The Physicians Forum sincerely urges the Congress to take bold and prompt action in accordance with the principles stated in order to conserve and improve the Nation's most priceless asset-the health of its people. History. The Physicians Forum was first organized here in New York County in 1939 by a group of prominent physicians, all members of the county medical society. They met informally to discuss matters of general socialogical-medica} interest, particularly methods of improving medical care. In January of 1941, it was established officially by the election of Officers and the adoption of a constitution and bylaws. Its members were in agreement on two fundemental propositions: First, the general public demands more and better health services but, on the whole, is unable to purchase them on an individual basis. Second, a well-planned program of medical care would benefit the public and contribute to the economic stability of the physician. At this time, membership in the forum was open only to members of the Medical Society of the County of New York, though its forums were open to the profession and to the general public. The organization made a study of postwar medical-care needs and presented their conclusions to the Senate. These activities established its national reputaiton and, because many doctors outside of New York wished to participate, it became a national body and was incorporated under the laws of New York State. It has functioned nationally since that time, often being called upon by legislative bodies for its views and recommendations on health proposals. Structure. The forum is headed by national officers and members of its board of directors, elected by secret ballot annually. These names appear on this letter head. There are chapters in Chicago, Boston, New York County, Kings County, and Queens County, and loose-knit groups in Los Anegels, San Francisco, and Washington, D. C. There are also members-at-large where no chapters exist. At the present time, there are approximately 1,000 members in 30 States, all of whom are members either of their local medical societies or of the National Medical Association (the national medical society of Negro doctors, many of whom are denied membership in the American Medical Association by reason of their being barred from their county units because of his race). PRESS RELEASE OF MAY 17, 1954, BY JAMES C. HAGERTY, PRESS SECRETARY TO THE PRESIDENT THE WHITE HOUSE. At the invitation of the President, 17 officials of life insurance companies attended a luncheon conference at the White House today to discuss the administration's pending legislative proposal to establish health reinsurance facilities as a function of the Department of Health, Education, and Welfare. Secretary Hobby and other officials of the Department were also present at the luncheon. At the conclusion of the conference, the life insurance company representatives issued the following statement: "During our conference with the President there was a general expression on the part of the life insurance company representatives who were present favoring the general objectives of the bill. We believe the measure is directed toward encouraging and stimulating still further the development and expansion of health insurance services and coverage for the American public through voluntary plans. There was discussion at the conference as to how the bill may be improved. The plan includes many sound insurance principles. We feel that provision in the bill dealing with the utilization of State insurance departments under the plan may be further strengthened in order that they may be used to the maximum extent and that the system of State supervision of insurance should not be limited by Federal activity in any field." Present at the conference were: Horace W. Brower, president, Occidental Life Insurance Co., Los Angeles, Calif. Asa V. Call, president, Pacific Mutual Life Insurance Co., Los Angeles, Calif. Paul F. Clark, president, John Hancock Mutual Life Insurance Co., Boston, Mass. Frederick W. Ecker, president, Metropolitan Life Insurance Co., New York City Louis W. Dawson, president, Mutual Life Insurance Co., New York City W. T. Grant, chairman, Business Men's Assurance Co. of America, Kansas City, Mo. S. J. Hay, president, Great National Life Insurance Co., Dallas, Tex. Ralph R. Lounsbury, president, Bankers National Life Insurance Co., Montclair, N. J. Ray D. Murphy, president, Equitable Life Assurance Society of the United States, New York City Powell B. McHaney, president, General American Life Insurance Co., St. Louis, Mo. Clarence J. Myers, president, New York Life Insurance Co., New York City Adlai H. Rust, chairman of the board, State Farm Life Insurance Co., Bloomington, Ill. Eldon Stevenson, Jr., president, National Life & Accident Insurance Co., Nashville, Tenn. Carroll M. Shanks, president, Prudential Insurance Co., of America, Newark, N. J, Frazar B. Wilde, president, Connecticut General Life Insurance Co., Hartford, Conn. Claris Adams, executive vice president and general counsel, American Life Convention, Washington, D. C. Eugene M. Thore, general counsel, Life Insurance Association of America, New York JOHN HANCOCK MUTUAL LIFE INSURANCE CO., Boston, Mass., June 10, 1954. Re Administration Health Reinsurance Plan, S. 3114 and H. R. 8356 Chairman, House Committee on Interstate and Foreign Commerce, MY DEAR CONGRESSMAN WOLVERTON: We in this company thought that your committee might be interested in our position on the administration's reinsurance legislation. On May 17, 1954, I joined with other life insurance people, after the White House conference, in favoring the general objectives of this proposed legislation. In subsequent correspondence with the White House and at the request of the administration, I pointed out two areas in which the bills could be improved. First, a provision should be inserted that stated nothing in the bill should limit the jurisdiction of any State or of its supervisory officials over insurance; and, second, it should be made clear that the legislation in no way contemplated the further introduction of the Federal Government in the insurance business, even inadvertently. Since then we have had the opportunity of examining the modifications suggested by the Department of Health, Education, and Welfare and I am happy to say that these specific points have been adequately covered. It is our belief that life insurance companies can find in this legislation assistance for their efforts to extend this coverage. Accordingly, this company wholeheartedly supports the bill to implement the administration's reinsurance legislation. Sincerely yours, PAUL F. CLARK, President. Hon. CHARLES A. WOLVERTON, CONNECTICUT GENERAL LIFE INSURANCE CO., Chairman, House Committee on Interstate and Foreign Commerce, House Office Building, Washington, D. C. DEAR CONGRESSMAN WOLVERTON: The county and the insurance industry would be well served, in my opinion, if your committee reports out favorably the administration health reinsurance plan, H. R. 8356. The subject has had a good deal of study by my associates and we are satisfied that this would be constructive legislation. In addition, it would have the virtue of reaffirming the soundness and desirability of State regulation of insurance as national policy. Some have stated that the reinsurance authorized by the bill would be little used. This is a premature judgment and one not possible of advance determination. The probability is strong that if this legislation is passed by the Congress, it will be used and will be useful to the country. Thank you for your consideration of this recommendation. Sincerely, FRAZAR B. WILDE, President. Hon. CHARLES A. WOLVERTON, STATE OF NEW HAMPSHIRE, INSURANCE DEPARTMENT, State House Annex, Concord, June 17, 1954. Chairman, House Committee on Interstate and Foreign Commerce, MY DEAR CONGRESSMAN WOLVERTON: In compliance with the action taken by the National Association of Insurance Commissioners at its annual meeting held in Detroit, Mich., June 7 to 11, 1954, I am transmitting to you a copy of a resolution passed by the association on June 11, 1954, in connection with H, R. 8356 dealing with voluntary health reinsurance plans. Respectfully yours, DONALD KNOWLTON, Insurance Commissioner, State of New Hampshire; President, National RESOLUTION OF NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS "Whereas the executive committee of the National Association of Insurance Commissioners on April 6, 1954, adopted a resolution approving as being meritorious and in the public interest the avowed and declared objective of improving the public health in the Nation but opposing the enactment of H. R. 8356 and S. 3114 (83d Cong., 2d sess.) in the form introduced in Congress and copies of such resolution were transmitted to the congressional committees considering such legislation; and "Whereas since that time officials of the United States Department of Health, Education, and Welfare and interested members of this association have, in a cooperative effort, discussed changes in the bills to the end that objections thereto might be met; and "Whereas certain definite amendments have been proposed which furnish further guaranties against Federal regulation of insurance to which regulation all parties are opposed and officials of the United States Department of Health, Education, and Welfare have agreed to consider other changes which further study of the bill may disclose to be desirable; and "Whereas this association desires to cooperate further to the end that all practical measures for expanding the voluntary health system of this Nation, consistent with the existing pattern of free enterprise and of State regulation be adopted: Now, therefore, be it "Resolved, That in accordance with this resolution, the president of this association is authorized to appoint a special committee consisting of five members of the association to work with the United States Department of Health, Education, and Welfare and appropriate committees of Congress and the insurance industry, to accomplish the ends sought by this resolution with power to suggest and approve amendments to legislation now pending in Congress and to approve such amended legislation subject to ratification by the association. “(a) The president of this association is authorized to transmit copies of this resolution to the interested committees of Congress and the Department of Health, Education, and Welfare." Passed June 11, 1954, by the National Association of Insurance Commissioners at its 85th annual meeting in Detroit, Mich. BLUE SHIELD MEDICAL CARE PLANS, Hon. CHARLES A. WOLVERTON, Chairman, Committee on Interstate and Foreign Commerce, Room 1334, House Office Building, Washington, D. C. DEAR MR. WOLVERTON: The following tables are enclosed: (1) Distribution of membership in Blue Shield Medical Care Plans by subscribers and dependents, 1950-53, by States; (2) Blue Shield Plans classified by method of providing benefits, 1950–53; (3) Distribution of Blue Shield enrollment by type of contract, 1950–53; (4) Distribution of membership in Blue Shield plans, by sex, 1952 (by States); (5) Distribution of membership in nonmember plans of Blue Shield, by subscribers and dependents, 1950, by States. We do not have a record of membership in nonmember plans since 1950. If we can be of further assistance please call on us. Sincerely, COURTNEY H. TABER, Manager, Research Division. Distribution of membership in nonmember plans of Blue Shield, by subscribers and dependents, 1950, by State 'Does not include 154,000 welfare members. Distribution between subscribers and dependents not available. |