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that costs become burdensome and sometimes catastrophic. Representatives of the insurance industry tell me that it is not difficult to provide catastrophic coverage with rates based on sound experience at low costs. My own basic policy for myself and wife costs $38.00 a month. A $250,000 catastrophic policy costs us only $7.00 a month. The basic first dollar coverage has increased yearly and the company has had to adjust rates yearly, and in many years report a loss. The same company tells me that they can make money on the catastrophic policy.

It is my hope that the next step toward a national policy of health care will be in the form of catastrophic coverage. The definition and financial limitations or corridors before this coverage commences could be sliding, depending on income or basic policy. For the medically indigent, society meaning government and provider should jointly provide.

With experience, with increasing number of primary physicians, as well as medical personnel, addendums or modifications could be made and modified as warranted. This action would solve our most pressing problem without overburdening the system or the resources available.

In summary, gentlemen, I believe that a basic catastrophic policy with co-insurance adjusted to income and administered by our insurance industry, should be the initial step. The greatest danger would be to pass an Omnibus Bill, which might well bankrupt the government and leave our present health care system in shambles. 2. Studies and recommendations on Cost Payors, Public, Providers, Legal and Religious

Effectiveness.

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input into some definite recommendations.

3. Utilize the present system to the fullest extent. This system has provided the best health care to the greatest number of people in all history. Despite some weaknesses and appearance of fragmentation, it has done an outstanding job' of treating the sick and preventing disease. Most of the great break throughs have occurred in the private sector. Philanthropy has contributed

greatly to payment for health care, education and hospitals. We know that extensive legislation and regulation increases costs and stifles initiative to the detriment of all. 4. The doctor's skill and the hospitals' facilities have advanced so rapidly they have had difficulty in meeting the new demands. The public must be re-educated to more reasonable expectations and made aware that the basis of good health is in the way they live and that they can do the most to improve their health. 5. Social costs should be separated from health care costs. Much of the expense now charged to health care is in reality social costs.

I hope that in our discussion and questions we may cover more completely the many facets of this problem. Again I thank you for the privilege of being with you and will attempt to answer questions put to me.

STATEMENT OF CLINTON S. MC GILL, M. D., PRIVATE PRACTITIONER

Re: National Health Insurance

Submitted to the Subcommittee on Health of the
Committee on Ways and Means

United States House of Representatives

September 12, 1975

Mr. Chairman, I am Dr. Clinton McGill.

I earn my living in the private practice of internal medicine in downtown Portland, Oregon. I have done so for the past 27 years. During this period I have also worked within the structure of organized medicine. I am a past president of both my county and state medical societies and I am currently a delegate to the American Medical Association. I have worked as a part time medical consultant for the Oregon State Public Welfare Commission and as the Medicare Consultant for Oregon. I have had considerable interest in National Health Insurance and have served on various committees at the state and national levels dealing with this subject. As a long time member of the AMA Speakers Bureau, I have participated in various forums, panel discussions, debates and discussions on the issue where widely diverging views on National Health Insurance were expressed. Over this period, I have developed some ideas of my own on this very important topic and appreciate this opportunity to present them. In this discussion I will try to confine my remarks to general principles and overall guidelines rather than specifics. The specific benefits included in any National Health Insurance must necessarily be decided by the political climate and the financial status of the country. It would seem obvious that fleshing out the benefit package first depends on the basic structure of the program.

During the past month I have read much of the testimony already heard by this Committee. I was encouraged to hear even the most liberal minded advocates of National Health Insurance advise this Committee that a sound program must evolve slowly and should be phased in over a number of years. Experience has taught us that broad sweeping social programs, once passed by Congress, may be modified, but they are essentially irrevocable. It is of utmost importance that any such program be soundly based and supported by providers and consumers alike.

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Any thoughtful consideration of National Health Insurance soon reveals just three variables three dynamics, if you will involved in such a program. These dynamics are cost, quality and access. Any National Health Insurance program must achieve the proper and equitable balance of these three factors. Past experience has taught us that one or two of these factors can conspire against the third. For example, if the system is open for universal access, the product invariably will be an increase in cost or a decrease in quality.

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In past years, within the medical fraternity, we have been most interested in quality. Perhaps we should have been more intereseted in access and cost, since we have belatedly learned these factors are of equal importance. If the quality of health care is to increase, the cost must necessarily increase or the access must be decreased. In Congress there is a logical concern about cost in any such program and I find this properly so. But I must point out that a single-minded policy of cost control can lead only to decreased access or decreased quality. Parenthetically, the Federal government has developed the philosophy that whatever it pays for it must necessarily control. Herein lies the basis for the development of bureaucracy with the centralization of power in Washington. The recent decision of Federal Judge Julius Hoffman in Chicago controverts this policy and at least should bring a refreshing review of this justification for federal control. Considerable testimony already heard by this Committee has strongly recommended local control and administration of any plan of National Health Insurance.

Those of us who practice medicine have worked with health insurance programs for a number of years now. This experience has taught us certain basic principles. I would like to place before this Committee some of these fundamental principles as I see them and why we feel they are important.

First and foremost, freedom. We feel that every individual ought to be free to chose his own doctor, or delivery system, or type of health insurance coverage he feels is most appropriate. In recent years, Congress has heard testimony on a variety of schemes to reorganize the delivery system in medicine along the HMO lines, prepaid capitation, various kinds of group practice and the like. It is my own opinion that private practice, fee for service medicine as we know it today will continue for some time to come. This is true simply because both the doctor and the patient find it desirable. I personally do not look to a great increase in the prepayment, capitation method. This has been around for a great many years. Some 80% of these programs exist on the west coast of the United States. Although their growth has been gradual, it has not been spectacular. There are a great many patients and a number of doctors who like this type of delivery system. There is a much larger percentage of both patient and doctors who do not find it satisfactory. Private health insurance has made great strides in the past 30 years and the majority of Americans are now covered by quite satisfactory health programs. In my view, the most urgent areas requiring coverage for National Health Insurance are an adequate plan for the poor and some type of catastrophic coverage for everyone. It should be pointed out here that those who have good private health insurance can add catastrophic coverage for minimal cost. However, some arrangement should be made guranteeing catastrophic coverage for all. Within medicine for many years we have been concerned that there be no financial barrier to adequate health care. Certainly a comprehensive program covering the poor is a must.

As a corollary of freedom, we believe that pluralism in methods of health care delivery must be allowed. Certainly different areas and certain population bases require different kinds of systems. Any national program should allow for existing systems, as well as the development of new health care systems. I think it is of great concern to all physicians that a federal program not freeze the

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health care delivery at the current level and allow no room for innovation
and experimentation. That seems to have been the experience in other countries.

As a second corollary of freedom, we believe there should be state jurisdiction over licensure, certification and regulation of insurance benefits, perhaps operating under federal guidelines, but nevertheless, administered at the state level.

We also feel that funding should come from multiple sources, including employeremployee contributions, as now exist in many fine private health insurance programs. We also feel that a system of individual tax credit has merit and should be explored. Experience has taught us that no further financing should be attempted through social security taxes, nor should the program be administered by Social Security. This use of all existing financing mechanisms should allow minimum federal financing.

Any workable National Health Insurance program must include some control over access or the demand for services will soon swamp the system and drive the cost to unacceptable levels. The most workable cost control devices are coinsurance and deductibles, except for the poor. These are time tested and have served the private health insurance industry quite well.

I would agree that some assurance of quality control should be included, but I strongly feel that the development of quality standards and their enforcement should be left within the medical profession. I think all physicians have a basic fear, that quality control by federal guidelines would lead to an overstandardization of medicine and the development of "cookbook techniques" which depersonalize this most personal of services. We are convinced this would lead to the deterioration of medical care for both patient and physician.

We have all heard that medical care in the United States is a "non-system". I would point out that any attempt to systematize medicine automatically dehumanizes it. I am certain that any such dehumanizing would be unacceptable to both the doctor and the patient.

I am aware, as are most of the physicians in this country, of the great difficulties confronting this Committee to solve the vast complexities involved in any National Health Insurance program. It is indeed a formidable task. I would again echo the sentiments of witnesses already heard before this Committee, that any plan be evolved slowly and begin with basic principles. As we gain experience, we can better judge the optimum benefits which can be allowed within the available resources of the country professionally, as well as financially.

As a final point, I would like to make a plea for the young people entering medicine today. We have been fortunate in recent years to attract a particularly bright and talented group of young people into the field of medicine. Whatever system evolves, if we allow our younger generation of doctors to practice the kind of medicine they know how to practice, where they want to practice, and under what system they wish to practice, I have no fear for the future standards of health care in this country.

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