Mr. CRUIKSHANK. I am trying to do my best. Perhaps, Mr. Biemiller can do better than I can, Mr. Congressman.

Mr. BIEMILLER. I will be glad to pick that up. The role of the Federal Government is purely in the collection of the tax imposed on employer and employee. That tax would be collected as is the socialsecurity tax by the Internal Revenue Service. Those funds are then available to give out through the Public Health Service to State agencies that have to be set up under the bill. The State agencies, in turn, can utilize those funds for distribution to groups like Permanente, in the HIP plan, and so forth, because the individual would designate that be belonged to a particular plan. In the case that he belonged to the Permanente plan, his record under the capitation system would go to Permanente and the administration of the health benefits would be through these local groups scattered throughout the entire United States.

In the case of the individual person who did not join Permanente or some other group and who still wanted to go along on a fee for service system with an individual doctor, when he received treatment, just as you do today under that type of medical plan, the doctor would certainly file to the State plan that he had treated Mr. X on such and such a day. Instead of Mr. X paying the doctor, the remnants of the fund that are still held and have not been allocated to group plans would be used to pay the doctor on a fee-for-service system.

Mr. BENNETT. Would there be any Federal control or any State control as to the amount of medical services that an individual would be entitled to?

Mr. BIFMILLER. Minimum standards that are prescribed in the bill, itself, and that, within certain limitations, can be still further narrowed by a group of medical practitioners appointed by the Public Health Service or by the State boards, as the case may be.

The bill was drawn with the idea of allowing the greatest possible latitude to keeping the question of medical services and the purely medical aspects of the plan in the hands of boards of physicians.

Mr. BENNETT. Is there a bill of that kind introduced?

Mr. BIEMILLER. I believe Mr. Dingell has reintroduced the bill of several years ago. I think it is pending before your committee officially.

Mr. BENNETT. Is that the same bill that he had before?

Mr. BIEMILLER. It is the same bill we held the hearings on in 1949. Mr. BENNETT. Under that bill, as I understood it, free medicine was provided and free hospitalization.

Mr. BIEMILLER. You mean free in the sense that the individual did not have to make payments.

Mr. BENNETT. He was entitled to all of the medical and hospital services that he needed.

Mr. BIEMILLER. That is right, with certain exclusions which Mr. Cruikshank mentioned earlier.

Mr. BENNETT. Also in that bill I thought that the Public Health Service set up regional boards and that they, in turn, employed doctors and set up the standards by which the medical people themselves, their fees and so forth, were determined.

Mr. BIEMILLER. As one of the coauthors of the bill, I will have to take exception to part of your statement.

The bill provided that the Public Health Service should appoint various boards of physicians who would, periodically, check upon the services that were being rendered, and the nature of such and so on. The Public Health Service would also set up certain minimum standards which a group plan would have to meet to become eligible. But there was no attempt made under that bill for the Public Health Service to employ physicians to give treatment. That is one thing we kept very far away from. It was, unfortunately, one of the misrepresentations about the bill made by certain groups in the United States that received credence, but it was never true.

Mr. CRUIKSHANK. Mr. Chairman, I want very much to answer all of the questions that I can, but you have another witness this morning, and I know he has another meeting. I can come back this afternoon if you would like to ask me more questions. I do not know whether any of the gentlemen have any more questions, but I can come back this afternoon for further questions. President Hayes of the International Association of Machinists is here and I know he has to be back at the office this afternoon.

The CHAIRMAN. If there is no objection, we will hear Mr. Hayes at the present time.

Mr. SPRINGER. I want to ask Mr. Cruikshank some questions and I just want to be sure that he will return.

Mr. CRUIKSHANK. I will return, Mr. Springer.

The CHAIRMAN. The witness will return.

This is in order to assist Mr. Hayes in the keeping of his engagement. Mr. SPRINGER. What time do you intend to reconvene this afternoon?

The CHAIRMAN. I would say at approximately 2 o'clock. The representatives of the International Lady Garment Workers Union are going to testify, also, this afternoon.

Mr. Hayes is the representative of the International Association of Machinists. He was born in Milwaukee, Wis., in 1900, and educated in the elementary and high schools of that city and the University of Wisconsin.

His first union service was as chairman of the apprentice boys' committee, Milwaukee railroad shops, in which capacity he served from 1917 to 1920. He joined the International Association of Machinists, Lodge 234, Milwaukee, in 1919, and transferred to IAM Lodge 1052 in 1923. He was president of IAM District 7, covering all machinists' lodges on the Chicago & North Western Railroad system, 1924-34. He was grand lodge representative from 1934-44. He was general vice president of the IAM from 1944-49; international president of the IAM in 1949 and reelected in 1953. He was cochairman of the united labor policy committee from 1950-51.

He was a member of the Sixth Regional War Labor Board, Chicago, during World War II. He was a special assistant on manpower, Department of Defense, 1950-51. He was a member of the President's Commission on Health Needs of the Nation in 1952. He is a trustee of the National Planning Association and director of the American Heart Association. He is a member of the following: national manpower council of Columbia University; Advisory Committee of the Senate Banking and Currency Committee; Commission on LaborManagement Manpower Policy, Office of Defense Mobilization; President's Committee on the Physically Handicapped.

Mr. Hayes, we are most happy to have you as a witness today, and to receive the information and advice which we know you are able to furnish the committee on the important subject of the health problems of our people, and, particularly, the position of organized labor in reference to those problems.

You may now proceed.

STATEMENT OF ALBERT J. HAYES, INTERNATIONAL PRESIDENT, INTERNATIONAL ASSOCIATION OF MACHINISTS

Mr. HAYES. Mr. Chairman and members of the committee: I feel somewhat embarrassed by the implication that I am requesting special consideration by this committee. I am not requesting any special consideration. I want to make it clear that I do not like to discommode this committee, and if the committee would prefer to adjourn for lunch at this time, I shall be very glad to come back at any time that is convenient to the committee.

The CHAIRMAN. Would that include this afternoon?

Mr. HAYES. That would include this afternoon.

The CHAIRMAN. Gentlemen, what do you think would be the procedure that would be most advantageous to the witnesses and to ourselves? Is it the desire to adjourn now, or would it be as convenient to adjourn at 12:30? Would your direct testimony be finished by that time, Mr. Hayes?

Mr. HAYES. I doubt it. I think it is approximately 40 to 45 minutes, Mr. Chairman.

Frankly, I consider this much more important than my other engagement.

Mr. YOUNGER. Would it be possible to complete Mr. Cruikshank's testimony now before lunch and then take the other two?

The CHAIRMAN. Mr. Springer has departed at this time, saying that he had some questions he would like to ask this afternoon. I suggest that the clerk get in touch with him and ask if he could return at this time.

Under the circumstances, it might be advisable to proceed with Mr. Cruikshank until we have finished with his testimony.

Mr. HAYES. I am very sorry that this occurred. If I had been consulted, it would not have occurred.

The CHAIRMAN. It was a matter that the committee was anxious to hear you speak on and we would not want to be precluded on account. of any engagement you had this afternoon. The suggestion came with the best of intent, and the committee was very willing to adapt itself to your convenience.

Mr. HAYES. I greatly appreciate that.

The CHAIRMAN. I can say, as a result of my personal contacts with Mr. Hayes, in this important matter, that the testimony that he is in a position to give is very valuable, not only from the standpoint of his many years of study with the subject but the experience that he has gained through his labor connection and, too, as a result of the splendid service that he and some other labor representatives with him gave to the President's committee.

We certainly appreciate having the benefit of that testimony.

We will proceed with those who wish to ask questions of Mr. Cruikshank, at this time.

Mr. Springer will return at 2 o'clock and we will finish with the other members of the committee, at this time.

STATEMENT OF NELSON H. CRUIKSHANK, DIRECTOR OF SOCIAL INSURANCE ACTIVITIES, AMERICAN FEDERATION OF LABOR (ACCOMPANIED BY ANDREW J. BIEMILLER, MEMBER OF THE NATIONAL LEGISLATIVE COMMITTEE OF THE AMERICAN FEDERATION OF LABOR)-Resumed

Mr. CRUIKSHANK. In view of what President Hayes has said, I do not think it is necessary for me to add any further comment to the effect that it was not he who mentioned to me the fact of a meeting this afternoon. But, some of his people had told me some days ago about there being a meeting this afternoon, and I had not learned to the contrary that he would be able to be here. I think it is characteristic of him that he would be willing to accommodate his schedule to the needs here, and I share your interest in having, under the best circumstances, the presentation of his statement as the president of one of our largest affiliates and as vice president of the American Federation of Labor.

The CHAIRMAN. This occurrence has, at least, benefited us to the extent that I had already indicated to the members the importance of Mr. Hayes and I would hope they would be inclined to be present this afternoon to hear his testimony.

Mr. Bennett has some further questions.

Mr. BENNETT. I am not clear as to what the status of the doctor would be under your proposal. Would an individual have the right to go to any doctor he chose and, if so, would the fees of the doctor be set by him or would they be set by some Federal or State agency?

Suppose an individual belonged to one of these health groups. Who would determine whether he had to accept the health group arrangement or whether he could obtain the services of a private physician? What I am trying to find out is how the doctor-patient relationship would work out under your proposal.

Mr. CRUIKSHANK. Well, in answer to your direct question, the individual himself would determine whether or not he continued in the group. Now, the method of his determination in that respect would vary.

Take, for example, a cooperative health association of which I am a member here in the city of Washington. If national health insurance were in effect, I could directly decide whether I wished to designate Group Health Association, Inc., in the city of Washington, as the agency which would supply me the benefits to which I was entitled under the program.

Another variation would be if I were working in a plant here, or in another city or anywhere, and were a member of a union which had negotiated a health plan and that plan was a part of the administrative machinery of the national health program. Then, I would determine that less directly. As a member of that group, having my right to vote and participate in its policies, my determination would not be so direct, but I would still have the voice in whether we should continue that group arrangement or whether we should disband it and go on an individual arrangement.

That would be the same as the choice that I would now have, let us say, if I were a member of the Retail Clerks Union, 177, in Los Angeles. I still have the right there as a voting member of a democratic organization to vote whether we continue to participate in that group arrangement.

So, there would be varying degrees of that determination.

Mr. BENNETT. In any case such as the 1 you just mentioned, would your proposal mean that 1 individual in any situation would be entitled to greater benefits for medical and hospital services than another individual whether he is in a group or whether he is just a private citizen?

Mr. CRUIKSHANK. Not in amount, but we would contemplate that individuals who consider that one group arrangement would provide him better and more adequate medical care than another just as he would make a decision that having Doctor A as against Doctor B on an individual basis, would be to his greater advantage. But he would be entitled to the same benefits whether Doctor A was his doctor or whether Doctor B was his doctor, whether he was a member or whether he chose a group to provide him with medical care.

Mr. BENNETT. The difference might be that if he was forced to stay in a group, as a member of a collective bargaining unit, his choice of doctors might be limited in such a case. Whereas, if he was not a member of that unit, his choice of physicians or doctors would be unlimited. Would that be a difference?

Mr. CRUIKSHANK. Well, his choice would be of a different kind. He is saying there when he has joined an organization which has a panel of doctors servicing him, in effect he is saying, "I want the group or the organization of which I am a voting part to help me in the selection of a doctor." Now, I have the same thing as a member of Group Health Association. I only have the doctors available to me who are members of the Group Health Association panel. I can't call up any doctor that I find in the telephone book and say, "Well, now, you come out to my home and then you will be paid by the Group Health Association." I have had a part in the selection of the doctors who are on the panel of Group Health, though.

Mr. BENNETT. That is true now, because, as I see it, that is on a voluntary arrangement.

Mr. CRUIKSHANK. But that would still be true.

Mr. BENNETT. That is an arrangement between you and the association, but now under the proposal that you are making here that Congress tax each employed individual in the country on a compulsory basis, it seems to be that everyone, whether he belongs to a union or whether he belongs to a health-group association, should be entirely free to choose his own doctor. Otherwise, under the law you are suggesting preferences would occur in favor of one individual as against another.

Mr. CRUIKSHANK. He would still be free to choose, sir. He would be free in these varying ways. As an individual, he can choose any doctor. Of course, the doctor has to agree to serve on the panel and he has to agree to be a part of the system. He can take himself out.

Mr. BENNETT. Who would say whether an individual had to belong to a particular health group and take his medical and hospital services in conformity with the rules and regulations of that group?