"5. An approved American specialty board is one which has been approved for the particular specialty by the Council on Medical Education and Hospitals of the American Medical Association or by the Bureau of Professional Education, Advisory Board for Osteopathic Specialists of the American Osteopathic Association."

A "hospital" is defined under this part as an institution, which: (1) is primarily engaged in providing by or under the supervision of physicians, to inpatients, diagnostic services and therapeutic services for medical diagnosis, treatment, and care of injured, disabled, or sick persons, or rehabilitation services for the rehabilitation of such persons; (2) maintains clinical records on all patients; (3) has bylaws in effect with respect to its staff of physicians; (4) has a requirement that every patient must be under the care of a physician; (5) provides 24-hour nursing services rendered or supervised by a registered professional nurse, and has a licensed practical nurse or a registered professional nurse on duty at all times; (6) has a "hospital utilization review plan"; (7) is licensed pursuant to State or local law or is approved by the State or local agency which licenses hospitals as meeting the standards established for licensing; and (8) meets such other requirements as the Secretary finds necessary in the interest of the health and safety of individuals furnished services in the institution, except that such other requirements could not be higher than the comparable requirements prescribed for accreditation of hospitals by the Joint Commission on Accreditation of Hospitals.

No accreditation is necessary in order to establish eligibility, but accreditation as provided in section 1865 of the bill can establish eligibility.

A "psychiatric hospital" is defined as an institution primarily engaged in providing by or under the supervision of a physician, psychiatric services for the diagnosis and treatment of mentally ill persons, which meets the requirements (3) through (8) for a hospital as defined above, and which meets requirements equivalent to the accreditation requirements of the Joint Commission on Accreditation of Hospitals (sec. 1861 (f)).

An "extended care facility" would mean an institution, or a distinct part thereof, which has in effect a transfer agreement with a hospital which has entered into an agreement to provide services under the bill and which: (1) is primarily engaged in providing skilled nursing care and related services for patients who require medical or nursing care or rehabilitation services; (2) has policies which are developed with the advice of a group of professional personnel, including one or more physicians and one or more registered professional nurses, to govern the services the facility provides; (3) has a physician, a registered professional nurse, or a medical staff responsible for the execution of such policies; (4) has a requirement that every patient be under the care of a physician, and provides for having a physician available to furnish medical care in case of emergencies; (5) maintains clinical records on all patients; (6) provides 24-hour nursing service in accordance with the policies developed with the advice of a group of professional personnel and has at least one registered professional nurse employed full time; (7) provides appropriate methods and procedures for dispensing and administering drugs and biologicals; (8) has in effect a utilization review plan which meets the requirements of the bill; (9) is licensed under State or local law or is approved by the State or local agency responsible for licensing such facilities as meeting the standards established for licensing; and (10) meets such other conditions of participation as the Secretary may find necessary in the interest of the health and safety of the individuals furnished services by or in the facility. The term would not include any institution which is primarily for the care and treatment of tuberculosis or mental diseases (sec. 1861 (j)).

In defining a "utilization review plan" the bill requires a review, on a sample or other basis, of admissions to the hospital or extended care facility, duration of stays, and professional services (including drugs and biologicals) furnished with respect to the medical necessity for the services and to promote the most efficient use of facilities and services, the review to be made either by a staff committee of the institution composed of two or more physicians with or without professional personnel or by a similarly composed group outside the institution established by the local medical society or a group established in a manner approved by the Secretary. It is understood that the term "local medical society" is applicable to local societies of either doctors of medicine or doctors of osteopathy (sec. 1861(k)).

A "home health agency" would be an agency which: (1) is a public or private nonprofit organization or a subdivision thereof and which is primarily engaged in providing skilled nursing and other therapeutic services; (2) has policies established by a group of professional personnel associated with the agency, including one or more physicians, and one or more registered professional nurses, to govern the services it provides, and provides for supervision of the services by a physician or a registered professional nurse; (3) maintains clinical records on all patients; (4) is licensed under State or local law or is approved by the State or local licensing agency as meeting standards established for licensing such agencies; and (5) meets such other conditions of participation as the Secretary may find necessary in the interest of the health and safety of the patients (sec. 1861 (0)).

Extended care services (1861 (h) (6)), and home health services (1861 (m) (6)), include medical services by interns and residents in training under teaching programs of affiliated hospitals approved by the AOA.

"Outpatient hospital diagnostic services" would be services which are furnished to an individual as an outpatient by a hospital, or by others under arrangements with them made by the hospital, which are customarily furnished by the hospital to outpatients for the purpose of diagnostic study, excluding any service furnished under an agreement, unless furnished in the hospital or in other facilities operated by or under the supervision of the hospital or its organized medical staff (sec. 1861 (p)).

“Physicians' services" would mean professional services performed by physicians, including surgery, consultation, and home, office, and institution calls, but not inpatient hospital services (sec. 1861 (q)).

"The term 'physician' when used in connection with the performance of any function or action means an individual legally authorized to practice medicine and surgery by the State in which he performs such function or action (including a physician within the meaning of section 1101(a) (7))" (sec. 1861 (r)).

The above definition of "physician" incorporates by reference section 1101 (a) (7) of the Social Security Act, adopted in 1950, which expressly includes doctors of osteopathy in the definition of "physician" under the general provisions of the Social Security Act (64 Stat. 559).

It was through application of the criterion that in order to qualify for inclusion under the term "physician" as used in the Social Security Act generally, one must be trained in the practice of the healing art in all its branches, that this committee in 1950, based upon the evidence submitted, found that graduates of the osteopathic schools of medicine so qualified and included them under section 1101 (a) (7).

The Congress similarly defined the terms "physician" and "medical care" and "hospitalization" as inclusive of osteopathic physicians and hospitals under the provision of the U.S. Employees Compensation Act in 1938 (52 Stat. 586).

Previous to that, in 1929, the Congress, in regulating the practice of the healing art in the District of Columbia, provided: "the degrees of doctor of medicine and doctor of osteopathy shall be accorded the same rights and privileges under governmental regulations" (45 Stat. 1329).

Osteopathic physicians and hospitals are used in the Medicare program for dependents of members of the uniformed services, by the Veterans' Administration, by the Bureau of Employees' Compensation, and in the Federal employees health benefits program, Government-wide service benefit plan administered by Blue Cross and Blue Shield, and Government-wide indemnity benefit plan administered by AETNA Life Insurance Co.

"Consultation with State agencies and other organizations”: In carrying out his functions relating to determination of conditions of participation by providers of services in the case of hospitals under subsections (e) (8), extended care facilities under (j) (10), and home health agencies under (o) (5), of section 1861, the Secretary is required to consult with the Health Insurance Benefits Advisory Council established by section 1867, appropriate State agencies, and “recognized national listing or accrediting bodies," and may consult with appropriate local agencies (sec. 1863).

"Use of State agencies": The Secretary would have to make an agreement with any State able and willing to do so, to utilize the services of State health agencies or other appropriate agencies (including local agencies) to determine whether an institution is a hospital, extended care facility, or home health agency. To the extent that the Secretary finds it appropriate, an institution or agency which a State (or local) agency certifies is a hospital, extended care

facility, or home health agency (as defined in sec. 1861) may be treated as such by the Secretary. The Secretary may also, pursuant to agreement, utilize the services of State health agencies to provide consultative service to institutions or agencies to assist them to qualify as providers of services (sec. 1864).

"Effect of accreditation": The Secretary is required to accept accreditation of a hospital by the Joint Commission on the Accreditation of Hospitals as meeting all the requirements of a hospital as defined in section 1861 (e), excepting the requirement of a utilization review plan which is not now a condition for accreditation by the joint commission. In addition, if the Secretary finds that accreditation of a hospital, nursing home, or home health agency by the "American Osteopathic Association or any other national accreditation body provides reasonable assurance that any or all of the conditions of section 1861 (e). (j), or (o), as the case may be, are met, he may to the extent he deems it appropriate, treat such institution or agency as meeting the condition or conditions with respect to which he made such findings" (sec. 1865).

Inasmuch as requirements for hospital accreditation and nursing home accreditation by the American Osteopathic Association equal or exceed the requirements specified in sections 1861 (e) and 1861 (j), including AOA requirement of a utilization review plan effective July 1, 1965, the express recognition of the American Osteopathic Association in the above provision as the accrediting agency for these institutions justifies the assumption that such accreditation will be found to confer acceptability, and stability of assurance.

Two hundred of the more than 300 osteopathic hospitals are accredited by the American Osteopathic Association. The accredited hospitals include 98 teaching hospitals and 111 registered (as distinguished from listed) hospitals.

Minimum standards of organization and practice for hospitals staffed by osteopathic physicians and surgeons were first established. and inspection and approval procedures adopted, by the American College of Osteopathic Surgeons about 1928. In 1935, the Bureau of Hospitals of the American Osteopathie Association assumed joint responsibility with the American College of Osteopathic Surgeons. Since 1949, the American Osteopathic Association has had full responsibility, which it now exercises through a committee on hospitals.

The committee on hospitals of the American Osteopathic Association is composed of four representatives of the osteopathic profession at large and a representative from each of the specialty colleges of surgery, radiology, internal medicine, and obstetrics and gynecology. They are thoroughly familiar with all phases of hospital administration and are charged with the formulation of hospital standards which are formally approved by the board of trustees of the American Osteopathic Association.

Any hospital desiring accreditation must submit to a rigid annual examination by the committee. If the hospital passes this examination it can be officially listed as registered. Hospitals which are approved for internship or residency training must pass an annual inspection even more comprehensive than that for registered hospitals. State and Federal agencies have recognized AOA accreditations.

"Health Insurance Benefits Advisory Council": To advise the Secretary on matters of general policy in the administration of the program and in formulation of regulations, there would be created a 16-man Health Insurance Benefits Advisory Council appointed by the Secretary, members of which would have to include persons outstanding in the fields pertaining to hospitals and medical and other health activities. We hope the Secretary will give favorable consideration to appointment of at least one member with an osteopathic background (sec. 1867).

"National Medical Review Committee": The bill establishes a nine-man National Medical Review Committee, a majority of whom must be physicians. The Secretary would be required to select individuals "who are representative of organizations and associations of professional personnel in the field of medicine." The committee would study the utilization of hospital and other medical care and services paid for under the program and recommend changes considered desirable. A representative of the American Osteopathic Association should be a member of the committee (sec. 1868).

Part 2-Grants to States for medical assistance programs

This part improves and extends the Kerr-Mills program by establishing a new title (XIX) in the Social Security Act to furnish medical assistance on behalf of families with dependent children and on behalf of aged, blind, or permanently

and totally disabled individuals whose income and resources are insufficient to meet the costs of necessary medical care. To be eligible for a grant, a State would have to submit a plan for medical assistance which has been approved by the secretary.

An approvable State plan must provide for inclusion, effective July 1, 1967, of at least the following care and services: "(1) inpatient hospital services; (2) outpatient hospital services; (3) other laboratory and X-ray services; (4) skilled nursing home services; and (5) physicians' services, whether furnished in the office, the patients' home, a hospital, or a skilled nursing home or elsewhere." Inclusion of other care and services would be optional (secs. 1902 and 1905).

The above five categories of services which the States would be required to include in their plans, if they elect to implement title XIX, would include the services of osteopathic hospitals and osteopathic physicians, notwithstanding their listing in House Report No. 213 as optional. In clear and unambiguous language, the definition of physician and hospitalization in section 1101(a) (7) of the Social Security Act expressly includes the legalized services of osteopathic physicians and hospitals, applicable throughout the titles of the act.

TITLE II-OTHER AMENDMENTS RELATING TO HEALTH CARE

Part 1-Maternal and child health and crippled children's services

"Special project grants for health of school and preschool children": The Secretary would be authorized to make grants "to any school of medicine" and "to any teaching hospital affiliated with such a school" to pay the costs of projects of a comprehensive nature for health care and services for children and youth of school age or preschool children (to help them prepare to start school). A project would be considered "comprehensive" if it includes at least screening, diagnosis, preventive services, treatment, correction of defects, and aftercare as may be provided in the Secretary's regulations. The grant could be up to 75 percent of the cost of the project.

No project would be eligible unless it provides for the coordination of the health care and services with, and the utilization of, other State or local health, welfare, and education programs, for payment of inpatient hospital services under the project in accordance with standards approved by the Secretary, and unless any treatment, correction of defects, or aftercare provided is available only to children who would not otherwise receive it because they are from lowincome families or for other reasons beyond their control.

It is understood that the terms "school of medicine" and "teaching hospital affiliated with such a school" include colleges training osteopathic physicians and hospital affiliated therewith and services of hospitals staffed by osteopathic physicians and surgeons.

In conclusion, the osteopathic profession and its institutions can be relied upon to employ their best efforts to provide and safeguard quality care and to pursue their traditional role of cooperation in the public interest. We will be pleased to aid the committee in any way we can.

DEPARTMENT OF VOCATIONAL REHABILITATION,

Re proposed amendment to S. 6675.

Hon. HARRY F. BYRD, Sr.,

U.S. Senator,

Washington, D.C.

COMMONWEALTH OF VIRGINIA,

Richmond, May 12, 1965.

MY DEAR SENATOR BYRD: I am sending you a copy of a proposed amendment to S. 6675 now under consideration by your Senate Finance Committee. I am sorry that I will not be able to contact you personally in regard to this but I am returning to Little Rock, Ark., tomorrow and for the next few days thereafter will be involved in moving my household furniture to Richmond, Va.

The proposal is to amend section 222 of the Social Security Act to permit payment of the cost of vocational rehabilitation services for disabled beneficiaries of social security from the OASDI trust fund. Demonstration programs over the past 3 years have shown that approximately 35 percent of the beneficiaries of this program have sufficient work potential to warrant referral to the State

Vocational rehabilitation agencies. It is a reasonable estimate to expect that a minimum of the 20,000 of the disabled beneficiaries can be rehabilitated each year if adequate resources are made available to the State vocational rehabilitation agencies. If the temporarily totally disabled also become eligible for disability benefits this number could easily be doubled. It is particularly important that this "temporary" group receive rehabilitation services promptly, otherwise many will become long-term disability cases.

At the present time each State vocational rehabilitation agency has the responsibility for providing vocational rehabilitation services to all the disabled in the State including the disabled beneficiaries of social security. The Federal funds used by the State rehabilitation agency must be matched with State funds ranging from 50 percent in the higher income States to 70 percent in the lower income States. Virginia must provide 1 State dollar for each 2 Federal dollars. At the present time each State must use its State tax money in the rehabilitation of the disabled beneficiaries of social security. It is felt the social security trust fund should bear the responsibility of paying for the needed vocational rehabilitation services of their recipients and that State tax funds should not be required in providing rehabilitation services for this group.

In actuality expenditures from the trust fund for vocational rehabilitation services for recipients of disability benefits will result in a net saving to the trust fund. Experience has revealed that it costs approximately $1,200 to provide Vocational rehabilitation to a disabled beneficiary. On the other hand, a disabled beneficiary may expect to receive about $9,000 in benefits if he has no dependents and about $17,000 if he has dependents. It is our belief that each disabled beneficiary that is rehabilitated will save the trust fund from 5 to 10 times the amount actually spent in his rehabilitation.

Safeguards are provided in the amendment and the regulations which would result therefrom to assure an orderly approach in the financing of rehabilitation services from the trust fund. We recognize that payment should start on a small scale and be expanded as experience is gained and the results documented. You will note that the amendment specifies in subsection (b) (1) that the total amount that can be transferred from the trust fund in any fiscal year may not exceed 2 percent of the benefit payment certified in the preceding year.

It is my understanding that this proposed amendment has been drafted by General Counsel and has the approval of the Social Security Administration and the Vocational Rehabilitation Administration although it is not an Administration sponsored amendment. It is something, however, that I have been working on for several years with Senator J. W. Fulbright of your committee and Representative Wilbur Mills, chairman of the House Ways and Means Committee. I commend this proposed amendment to you and sincerely hope that your study of it will result in your support. It will mean that in Virginia we will be able to use our State funds to earn Federal vocational rehabilitation funds for the provision of services to persons other than those who are covered by social security and use social security trust funds in the rehabilitation of those who are disabled beneficiaries of social security.

I will be more than pleased to provide you with any additional information you may desire. I am taking the liberty of sending a copy of this letter to Senator Robertson and Senator Fulbright with the request that they also study the proposed amendment and join you in support of it if they are in agreement with the principle involved.

Sincerely yours,

DON W. RUSSELL, Director.

PAYMENT OF COSTS OF REHABILITATION SERVICES FROM TRUST FUNDS (AN

AMENDMENT TO S. 6675)

Section 222 of the Social Security Act is amended by redesignating subsections (b) and (c) as subsections (c) and (d), respectively, and by inserting after subsection (a) the following new subsection:

"Costs of rehabilitation services chargeable to trust funds

“(b) (1) For the purpose of making vocational rehabilitation services more readily available to disabled individuals who are (A) entitled to disability insurance benefits under section 223, or (B) in a period of disability under section 216(i) or (C) entitled to child's insurance benefits under section 202 (d) after having attained age 18, to the end that savings will result to the trust funds as a result of rehabilitating the maximum number of such individuals into productive