Senator ELLENDER. In order to be able to reach that goal, to provide the necessary facilities to care for all of the people and put a uniform tax over everybody, it will probably take many, many years.

Mr. LAGUARDIA. It will take few years to build up a proper serv ice, but we ought to take advantage of what we can and get this thing started, but I want to start it right.

Senator DONNELL. I understand in response to Senator Ellender's inquiries, that when the United States, all of it, shall have become qualified, then if there is any deficit in any particular area, it will be met by general taxation of some kind.

Mr. LAGUARDIA. Yes.

Senator DONNELL. Suppose, however, that in the process of development, we will say that New York, Pennsylvania, and New Jersey shall be made area No. 1 and it qualifies on the first day of July, but there is a deficit in that area, we will just assume that for purposes of discussion, deficit from the tax which the Federal Government under your plan would impose solely on the people in New York, Pennsyl vania, and New Jersey, how would you meet that deficit? Mr. LAGUARDIA. For the first 5 years?

Senator DONNELL. For any number of years.

Mr. LAGUARDIA. That would balance the cost of providing facilities in other areas of the county that did not provide them themselves. Senator DONNELL. I do not thing that I made my inquiry clear. Suppose that New York, Pennsylvania, and New Jersey constitute area No. 1.

Mr. LAGUARDIA. That is right.

Senator DONNELL. And suppose that on July 1, 1946, the Surgeon General certifies that that area is duly qualified, and thereupon the Federal Government slaps on a tax applicable to all of the people in New York, Pennsylvania, and New Jersey.

Mr. LAGUARDIA. Yes.

Senator DONNELL. Suppose that that tax which the Federal Government imposes on them shall not prove sufficient to pay the expendtures, we will say in the first 5 years, while some parts of the remainder of the United States are not yet qualified, would you advocate that the Federal Government shall pay the deficit incurred in New York. Pennsylvania, and New Jersey, or would you advocate that those States should pay it, or just what would your plan be then?

Mr. LAGUARDIA. You have two alternatives. If you have a general fund for building up this plan, which would include the training of doctors and nurses and providing facilities as we do in the other bill, there you have a national charge, and if there were any deficit. it could come out of this fund or it could be applied by increased rates locally. But to have a health insurance plan in our country successful, it has got to be national in every State of the Union.

Senator DONNELL. Then if it should take 2 or 3 years before the sparsely settled sections of our country shall have qualified, and a deficit shall have accrued in the meantime in some of these larger an more popular sections of the country, you would advocate, would you that the deficit be paid by taxation upon all of the people of the Unite: States?

Mr. LAGUARDIA. No; you could increase the contributions.
Senator DONNELL. You mean in the local area?

Mr. LAGUARDIA. Yes.

Senator DONNELL. You would have a local area until the entire country shall have become qualified, you would have each such local area severally meet its own deficit?

Mr. LAGUARDIA. You see, Senator.

Senator DONNELL. Is that correct? Pardon me, I did not get your

answer.

Mr. LAGUARDIA. The answer is that areas that can now qualify can operate without a deficit. The deficit will not come from the areas that have medical services now. The deficits will come in sparsely populated areas and in certain sections of our country that have hardly any medical services at all. There is where the deficits are going to

come.

Senator DONNELL. Assume that to be true. However, for the purpose of argument, just assume that for some reason, due, we will say, to epidemic or something of the kind in these three States of New York, Pennsylvania, and New Jersey, there should be a deficit before the areas all over the country have become qualified. Would you advocate that the local communities-New York, Pennsylvania, and New Jersey-should meet those deficits, or would you have the deficit met by general taxation all over the United States?

Mr. LAGUARDIA. I will not fall for that one. I would increase the rates locally. I will not fall for that one.

Senator DONNELL. Just one question. I take it that we are clear on the fact that title II of S. 1606 does not contain the suggestion that you have made here today about this formation of areas, gradual qualification of them, and the imposition of a Federal tax applicable solely to each qualified area. It does not contain such provision. Mr. LAGUARDIA. No.

Senator DONNELL. Thank you.

The CHAIRMAN. Do you think there is any likelihood of deficits under this system occurring in the rich industrial areas of the country? Mr. LAGUARDIA. No; we will have no deficit there at all. Where you will have the deficit, if you want to.know, will be such States as Mississippi, Alabama, parts of Georgia, large States like New Mexico, and Arizona and perhaps Montana, where you have to provide certain minimum requirements of services, and you are bound to have deficits. We in the industrial centers are happy to contribute to that. The CHAIRMAN. And the policy of developing facilities in those backward areas has already been established by the United States. Mr. LAGUARDIA. And we are paying part of that.

The CHAIRMAN. And it is now on foot. We are planning on constructing hospitals and facilities in those backward areas. You could not believe that that would take any great length of time to set up the necessary facilities in those areas, if the funds were made available for that purpose.

Mr. LAGUARDIA. Not for physical facilities. I think if you had the money ready now and assuming that we had building material, if we had the building material, we could build all of the hospitals. Look what we do in a war, and this is a war against disease, and against poverty, and against hardship. We could build all of the hospitals we wanted with our resources in the course of two years and a half, or 30 months, if we had the material and the money. The personnel will take a little longer.

HOSPITAL PLANS IN NEW YORK

The CHAIRMAN. Is there need of further hospitals and facilities in the New York area?

Mr. LAGUARDIA. I will give you an idea, gentlemen, and this is not false. Here is what I provided for: This is all new. The new general hospitals at East Bronx will provide for 750 beds, estimated authorized amount, $6,034,000.

The new general hospital in Queens, authorized, 750 beds, $6,000,000. The Queens General Hospital, new out-patient department, that is out-patient department to our existing general hospital, that is $2,368,000.

I will not bother you with laundries, but that is a big item in a hospital. Now, the Bellevue reconstruction, they now have about 3,000 beds, and, gentlemen, we are going to rebuild that whole thing and that will be the greatest medical center in the world.

The CHAIRMAN. Is this a State program?

Mr. LAGUARDIA. A city program. That is $16,200,000. All of this money is well spent.

Senator ELLENDER. You mean in addition?

Mr. LAGUARDIA. This is $16,000,000 alone, each one is money. The CHAIRMAN. That has nothing to do with the Federal program of hospital construction.

Mr. LAGUARDIA. We would like to get some of your money for my successor. The new chronic disease hospital at Welfare Island, with a bed capacity of 2,000 and 1,000 of these are for custodial bedridden patients.

You see what happens today, gentlemen, you take chronic diabetes cases or just old-age disability, people take them and bring them to one of our hospitals and that is the end of it. And they occupy a bed that is needed for an active case. That is why we are providing these new custodial hospitals. Here is a new general hospital in East Harlem, that is 750 beds, $6,000,000. Here is a new Bellevue Hospital Nursing School, this is for training of nurses, that will provide 950 nurses at $5,085,000.

Here is a nursing school in Queens General Hospital, 200 students, $1,400,000. Here is my Cancer Memorial Hospital I told you about with 300 beds, advance cases, $1,500,000.

Here is Nightingale Hospital, cancer research, $4,023,000. Here is Kings County Hospital, tuberculosis extension, 750 beds at 254 chronic tuberculosis cases, that is $3,250,000. The reconstruction of Seaview Hospital on Staten Island, 2,000 patients, tubercular, $7,500,000.

Reconstruction of Harlem Hospital, that is in addition to the new Harlem Hospital, and an increased bed capacity from 754 to 934, that will cost us $3,800,000.

The hospital downtown East Side section, 500, at $3,800,000. There is a hospital we are going to increase from 389 to 637. You see a hospital under 500 beds, the overhead is so much greater that it just does not pay. When you get a 250-bed hospital, unless it is definitely for research, the overhead is enormous and so we are increasing that.

Cumberland Hospital is still in its planning stage. Green Point Hospital reconstruction, 500 beds, $4,100,000. Coney Island, we are going to rebuild, that is 500 beds, that is $4,000,000.

Now, that is an idea of what the needs are today to give to the people the full advantage of progress in medicine, and that is only one little town on the Hudson.

The CHAIRMAN. You are president, or former president, of the United States Conference of Mayors. Do you know whether or not in other metropolitan areas programs of hospital construction are going forward?

Mr. LAGUARDIA. Yes; they all have programs. I can tell you how I will give you that. They have all filed their plans. Now, I have received planning money on two or three of these hospitals under the planning bill that Congress has passed, and I am hopeful of getting grants.

Senator ELLENDER. Mr. LaGuardia, in the various instances or examples that you have given to the committee as to what is being planned in that "little city on the Hudson," the aggregate amount of expenditures alone, with a quick guess, would be around $35.000,000 or $40,000,000?

Mr. LAGUARDIA. It is about $100,000,000. Laundries and things like that, I did not bore you with.

Senator ELLENDER. The Burton-Hill bill that the Senate passed 3 weeks ago provides for only $75,000,000 per year for the entire Nation.

Mr. LAGUARDIA. It is a start.

Senator ELLENDER. That is most inadequate?

Mr. LAGUARDIA. It is modest, but it is a start.

The CHAIRMAN. A larger sum was suggested, but the Congress held it down.

MEDICAL EDUCATION

Senator ELLENDER. Now, in addition to the hospitals to take care of the sick, can you not also see the necessity for educating more doctors?

Mr. LAGUARDIA. I have stressed that.

Senator ELLENDER. How would you do that?

Mr. LAGUARDIA. With these hospitals. You cannot educate doctors unless you have hospitals.

Senator ELLENDER. How would you provide for that? Would you say that the Congress ought to provide means by which doctors are to be educated?

Mr. LAGUARDIA. Senator, there are 25,000 able, competent young students in this country today that cannot get into medical schools because we have not the facilities. That is no exaggeration.

Senator ELLENDER. Would you provide for the education through Federal means or Federal funds?

Mr. LAGUARDIA. No; they would take care of themselves.
Senator ELLENDER. They would.

Mr. LAGUARDIA. Yes; we had no trouble getting students. The trouble is in facilities.

You see, a medical school is not like a law school. A law school you just jam them in, and you throw them in, and they listen some

times and sometimes they do not listen, and it makes no difference. But in a medical school you have to have the facilities, and you have to have your dissecting rooms, and you have to have your "labs," and you have to have the facilities, and they are limited in number. Senator ELLENDER. Would you provide for any funds in order to help them in their education?

Mr. LAGUARDIA. No; the hospitals will do that. I am not exag gerating when I say that there are from 20,000 to 25,000 young students trying to go into medical schools and cannot get in.

PROFESSIONAL INCENTIVE UNDER HEALTH INSURANCE

Senator ELLENDER. What incentive would there be for those young doctors, who propose to take up medicine, when they would be confronted with a proposition whereby they would have to submit to a plan, or, say, they would have to qualify under a plan originating in Washington before being employed or their fees would be fixed in advance?

Mr. LAGUARDIA. I think the same incentive that you and I had when we went to law school, we would go to Congress some day.

Senator ELLENDER. That may be, but the trouble is, you would have a board here in Washington fixing a set of fees applicable in various areas of the country, by which a doctor would have to abide. Mr. LAGUARDIA. He would make a nice living and render fine services.

Senator ELLENDER. And of course, it might lead to being put on a salary basis.

Mr. LAGUARDIA. It is better to be on a salary basis than have fees and be unable to collect them.

Senator ELLENDER. You still think that young men would have the incentive?

Mr. LAGUARDIA. Certainly.

The CHAIRMAN. There are a great many young doctors today that are unable to exercise their profession because they cannot get any place where they can get business. If they go to the backward sections of the country, they cannot live.

Mr. LAGUARDIA. Those people are really martyrs, doctors in this country, there are thousands of them, who are just rendering a community service and eking out an existence. Why old man Dafoe told me he never made over $300 a year until Mrs. Defoe came along and then he was living in clover, and he got the allowance from the Dominion of $1,800 and he used to come down to my town to celebrate. He is a great old man.

The CHAIRMAN. The establishment of this system would result in greatly increased incomes for the average medical practitioner.

Mr. LAGUARDIA. And for the average American family, too, in savings. The only ones who will suffer are the loan sharks and the undertakers. It will be tough on them.

The CHAIRMAN. The State of Virginia, according to the morning press, has made appropriations for scholarships for young men who want to study medicine.

Mr. LAGUARDIA. That is fine.

The CHAIRMAN. That could be done in other sections of the country where there is need for physicians, could it not, to give their local