E. I. Robinson, president, National Medical Association, Los Angeles, Calif.;C. Ru.us Rorem, director, Hospital Service Plan Commission, Chicago, Ill.; Richard H. Shyrock, University of Pennsylvania, Philadelphia, Pa.; Henry E. Sigerist, Johns Hopkins University, Baltimore, Md.; W. G. Smillie, Cornell. Medical College, New York, N. Y.; Bernhard J. Stern, Columbia University, New York, N. Y.; Harvey B. Stone, private medical practice, Baltimore, Md.; E. A. Van Steenwyck, executive director, Associated Hospital Service of Philadelphia, Philadelphia, Pa.; Gertrude Sturges, consultant to American Public Welfare Association, Wakefield, R. I.

Robert F. Wagner, United States Senator from New York; Ray Lyman Wilbur,. chancellor, Stanford University, Calif.; John J. Wittmer, medical and personnel director, Consolidated Edison Co., New York, N. Y.; Abel Wolman, Johns Hopkins University, Baltimore, Md.

Mr. DINGELL. A recent poll taken by Governor Dewey's State commission on medical care showed that 86 percent of the people said "yes" to the question:

Do you think everybody who lives in New York State should have insurance which pays doctor and hospital bills?

Fifty-two percent voted for a Government plan as distinguished from a voluntary one.

A poll taken in April 1943 by the National Opinion Research Center showed that 85 percent approved the principle of health insurance.

I also want to quote from a recent statement by the president of Opinion Research Corp. summarizing two public opinion polls which this organization took for the National Physicians Committee. Here is what these polls showed:

First of all, the evidence is irrefutable that the public strongly desires some easier way of paying for medical care. *** The public is overwhelmingly optimistic that something could be done to ease the financial strain of medical expenses: seventy-seven percent say, "Yes; something could be done to make it easier for people to pay for doctor and hospital care." Furthermore, this optimism is gaining-eight percent more people today than in 1943 say that something might be done to ease this burden. ***We find that more than half are willing to admit that they have at some time experienced hardship in meeting medical bills and 40 percent of the people say they are familiar with cases where others have foregone treatment because of financial stringencies. Last year we reported a strong sentiment for prepayment as a means of easing the financial burden of medical care. The surveys indicate that the market for prepaid medical care is broad. We find an overwhelming majority of the people (64 percent) saying they personally prefer to pay in advance.

INADEQUACIES OF VOLUNTARY HEALTH INSURANCE

What is the answer that the American Medical Association has given to the tremendous demand for health insurance that has been steadily growing for over 15 years?

Up until very recently the American Medical Association opposed even voluntary health insurance. Just 6 weeks ago Dr. Fishbein published an article in his propaganda journal in which he praised and defended

the delaying tactics that have been a feature of the policies adopted by the house of delegates (of the American Medical Association) since 1932.

Mr. Chairman, I consider that statement a callous and inhuman admission. Each year while thousands of persons are suffering and dying from preventable diseases the American Medical Association reioices in its "delaying tactics."

But finally last year the American Medical Association had to come out flat-footed for voluntary insurance. It finally had to be for some

thing constructive. One of the types of voluntary insurance it now endorses is the insurance sold by private companies. The administrative costs for this kind of insurance now average about 45 percent of the premiums. I repeat, the administrative costs for this kind of insurance now average about 45 percent of the premiums paid by the insured. Just think of it. Forty-five cents out of every dollar of premiums collected never come back to the beneficiary or his family in health benefits. That is not the extreme example, some individua! companies have administrative costs of 60, 70, or 80 percent of premiums collected. This is the tribute which an employee must now pay if he wishes to enjoy the doubtful privilege of voluntarily buying private health insurance.

Irrespective of whether the individual purchases his protection from a private insurance company or through a plan controlled by a State or county medical society, he rarely gets complete medical care. Existing contracts have all the usual ifs, ands, and buts in them. The contracts tell you when, where, and how you must get sick in order to be eligible for the contract benefit. If you get sick when you only need a doctor at home or at his office, such medical care isn't covered by the contract. You have to be sick enough to go to the hospital. There are innumerable exclusions, limitations, deductions, exemptions, of the kind you find in the small print in many health-insurance policies.

Let me illustrate from the voluntary plan we have in my own State of Michigan.

Under the Michigan medical-service plan which is run by the Mich.gan Medical Society, an employee, his wife, and children pay a fla: premium of $2.25 a month or $27 a year. A flat premium is unrelated to any ability to pay. For a person earning $100 a month this is equivalent to 214 percent of his wages. For the same protection a $300-per-month man pays only three-fourths of 1 percent of his wages, For this payment the family can receive medical care but-only while in a hospital. The plan, therefore, violates a cardinal principle of any good medical-care plan, namely to prevent sickness. Only after you are sick enough to go to a hospital does the voluntary plan afford a person protection. Since more than one-half of all expendi tures for medical care are made for nonhospitalized illnesses, this means that on the average, families must still pay 100 percent more out of their own pockets for comprehensive medical care.

The Michigan plan has the additional limitation that the individual physician may make unlimited additional charges-and does--to individuals with incomes over $2,000 and to families with incomes over $2.500 a year.

In other words, as an example of what a voluntary plan can do, the Michigan plan offers very little security, if any at all, to the sick person. He does not get complete protection. He never knows ahead of time what complete protection will cost him. He must still pay a large part of his medical-care costs when he gets sick. He must still worry about his medical bills. The private plans are, as a rule, but a cheap imitation of the real thing here and now proposed.

And I want to add parenthetically here, Mr. Chairman, that I would like to put into the record two brief articles which appeared in the Detroit Times, about the Blue Cross running $800,000 in the red

for 1 year, and another one by the same writer, Ward Schultz, indicating that the rate increase on 1,300,000 Blue Cross subscribers will be increased 35.8 percent, because the Blue Cross system in Michigan cannot stand the strain. It is $800,000 behind, has $300,000 surplus, and a number of hospitals have thrown up the plan, and unless the subscribers to the plan submit to this unheralded and unauthorized assessment, the plan will blow up and there will probably be no protection for the people who paid into the plan for health protection. I want this to be made a part of my remarks, Mr. Chairman. (The two articles referred to are as follows:)

[From the Detroit Times, Thursday, March 21, 1946]

BLUE CROSS RUNS $800,000 IN RED

(By Ward Schultz)

In the red more than $800,000 in 1945, the Michigan Hospital Service, operators of the Blue Cross insurance plan, today faced the prospect of either sharply increasing rates to its 1,272,000 subscribers or drastically reducing the coverage of its contracts.

Adding to the seriousness of the problem, some Detroit hospitals are threatening to withdraw from the plan because they claim the current payments do not cover costs.

An effort is understood to have been made at a recent meeting of Blue Cross executives and representatives of the hospitals to agree on a solution.

$800,000 IN RED

That a sharp advance in rates to policyholders would be necessary is indicated by the fact that total earned income amounted to only $9,095,863 last year, whereas total incurred expenses was $9,896,088, leaving the Blue Cross plan $800,224 in the red for the year.

As a result, the excess of assets over liabilities dropped to only $325,961 The Michigan Hospital Service statement of operations revealed that in 1945 approximately 15 percent of the organization's income went for operating expenses, which totaled $1,327,408.

$900,000 FOR SALARIES

Of that amount, $904,121 was for salaries.

Some of the more important items of expense listed by the group included rentals, $68,570; supplies, $90,156; postage, $51,722; telephone and telegraph, $26,637, and travel, $56,429.

In addition, Blue Cross listed approximately $41,000 as its expenditure for public relations.

No details of the proposed rate changes are available, but a new scedule is understood to have been submitted to the State insurance commissioner for his approval.

[From the Detroit Times, Thursday, March 21, 1946]

BLUE CROSS RATE ORDERED RAISED

(By Ward Schultz)

A 35.8-percent rate increase for 1,300,000 subscribers to the Michigan Hospital Service and 144 member hospitals was ordered today by David A. Forbes, State insurance commissioner.

The order was issued, Forbes said, after it was shown that the service, operators of the Blue Cross plan, had suffered a loss of $800,000 for the year ending January 1.

Vastly increased hospital costs, which rose much faster than contemplated, was the reason cited for the deficit.

RESERVES VANISHING

On January 1, 1945, the hospital service had a surplus of $1,100,000, Forbes said, and on January 1 of this year that amount had diminished to $300,000 Forbes explained that it was his "duty to see that premiums received are ade quate to cover costs."

So serious had the situation become that some Detroit hospitals had with drawn from the plan.

Here are rate of increases for various types of subscribers: For a single person, using ward service, from 80 cents to $1.12 a month; single person, sem private room, $1 to $1.40; family service (married persons), ward service, $ to $2.60; family service, semiprivate room service, $2.40 to $3.10.

Forbes added that the method of payment to hospitals by the service also wil be altered but the new plan still is under consideration. At present, the servic pays the hospital a flat $5 a day for ward patients and $6.50 for semiprivat room patients.

NEW RATES AT ONCE

Where this amount was inadequate to cover costs as determined by hospital audits, Blue Cross made an additional payment of $2 a day. If the amount sta was insufficient, the hospital service paid 50 percent of the balance.

The new rates will be placed into effect in the immediate future, it was indicated.

The CHAIRMAN. They may be included.

THE PLAN IS NOT RADICAL

Mr. DINGELL. Is compulsory health insurance such a radical idea, as the A. M. A. and the N. P. C. say it is?

If these charges are true, how is it that such eminent businessmen as Gerard Swope of General Electric Co., David Sarnoff of RCA. and a number of other businessmen, bankers, publishers, and individual doctors and dentists have endorsed compulsory health insurance

as

a thoroughly American plan, consistent with our tradition of using GovernmeL: to aid the people in doing things for themselves.

The principle of compulsory health insurance is no longer a partisan issue. President Truman has endorsed the idea clearly and unequivo cally in his special message to the Congress on a national healt! program.

I should also like to quote another endorsement of compulsory health insurance:

* * How many fair-minded employers would now give up industria accident insurance? The number would be infinitesimal, and so it would twith health insurance once it were firmly established.

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The issue has always been-shall it be compulsory as is workmen's compensation insurance and unemployment insurance, or shall it be entire`: voluntary? * * The voluntary approach has obviously not struck at th heart of our problem. In urging * a prepaid health-insurance program, I have advocate that participation in the plan be made compulsory. The compulsion applies however, only to the contributions that are made by the employer and the er ployee. It does not compel any one to receive any medical care. It does r compel any doctor to treat any patient. It merely compels those who are entiti to medical care to make contributions to the fund for that purpose. It is : no sense different from workmen's compensation insurance, which require employers to provide medical care for those in their employ who are injure at their work. The worker is not compelled to accept the service, but it is ava.. able to him if he desires it.

The man who said that was Gov. Earl Warren of California-a Republican. I congratulate Governor Warren on his outstanding political insight. He knows that the American people want health insurance. He knows that the bugaboo of compulsory health insurance burst in California and that it will not scare anybody; that voluntary insurance can't solve the problem. He knows that it is good sense to advocate compulsory health insurance.

THE PLAN DOES NOT REGIMENT DOCTORS

One charge made by the American Medical Association against the bill is that the Advisory Council is merely "advisory" to the Surgeon General. In other words, the American Medical Association implies that if you put a majority of doctors in control of the Council and make the Council's actions binding on the Surgeon General-why, then they would be in favor of a national health-insurance plan. I want to be frank about this. As one sponsor of this bill I would fight with all the energy in me to prevent passage of a health-insurance bill that put control of the fund under the American Medical Association or any other private organization, however reputable it may be.

The charge that the Advisory Council in the bill is just a puppet Council is ridiculous. Let me show you. Here is what the bill provides:

The Surgeon General is directed to establish a National Advisory Policy Council with which he is required to consult on all important questions of policy and administration. Section 204 (a) provides that members of this Advisory Council would be appointed from panels of names submitted by professional and other organizations concerned with medical services, education, hospitals, etcetra. The Advisory Council must also include representatives of the public.

Section 203 (1) provides that the Surgeon General is required to make a full report to the Congress each year on the administration of the program. Such report must include a record of the consultations with the Advisory Council, recommendations of the Council, and any comments thereon. Such a report assures that all relevant facts, opinions, recommendations, and actions of the Surgeon General and the Advisory Council will be public information and that the Congress has full information upon which to revise or amend the law.

To assure that the Advisory Council will and can meet on its own motion, section 204 (b) provides that the Council shall meet not less frequently than twice a year and whenever at least four members request a meeting. The bill also provides that the Council itself and each of its members shall be provided by the Surgeon General with secretarial, clerical, or other assistants. Finally, the Council itself may establish special advisory, technical, regional, or local committees or commissions, whose membership may include members of the Advisory Council or other persons or both, to advise upon general or special questions, professional and technical subjects, questions concerning administration, problems affecting regions or localities, and related matters.