the political partisanship that has at times unnecessarily embittered the good relationships so essential to the working of a service such as this.

One of the most reassuring features of this review of the first 10 years, written by representatives of all branches of the service, is the unanimous concept of a National Health Service. The criticism advanced is all constructive and indicates the lines along which reform should be directed. Perhaps the most important of these is the restoration of the general practitioner to his rightful place as the family doctor. Too often there has been a tendency for him to become what, in their memorandum to the Guillebaud committee, the Royal College of Physicians described as a disposal agent. Compelled for economic reasons to assume responsibility for more patients than he could cope with, and harassed by unnecessary calls on his time, he has often found it difficult to resist the temptation to refer many of his patients to hospital instead of dealing with them himself. The Danckwerts Award did much to alleviate this state of affairs—but clearly not enough. What is now required is a scheme that will reward a general practitioner in accordance with the quality rather than the quantity of his work. Whether this should be based on a radical modification of the present capitation fee with a much heavier loading for the first 1,500 or 2,000 patients on a doctor's list, or some form of fee per service rendered is a matter requiring urgent discussion. It is to be hoped that the royal commission now in session will produce an answer to this crucial problem. Counting heads-a process that has tended to dominate the discussions between the official representatives of the Ministry and the profession-is not enough. The laborer is worthy of his hire, but no mere slide rule will provide the answer to the reward of a doctor in relation to the quality of his work. In many ways the inability to get away from the slide rule mentality has been the major tragedy of these past 10 years.

If the family doctor were able to fulfill his true function there would be a commensurate financial gain in a reduction in the number of patients referred to hospital. Not only would this reduce the cost of the hospital service the most expensive item in the whole service; it would also reduce the need for capital expenditure on new hospitals. Were the family doctor to be provided with a reasonable income from a manageable rather than a maximum number of patients, this would go far toward helping him in what the recently published interim report of the Hinchcliffe committee on the cost of prescribing has described as his difficult task of insuring the careful spending of public funds on prescriptions which he issues at nominal cost to the patient. It is scarcely going too far to say that an efficient general practice service is the crux of the whole problem of evolving a National Health Service that will redound to the benefit and credit of the country. It is significant that the consultant who contributes the review of the consultant service to this supplement emphasizes this as one of the criteria of an efficient consultant and hospital service.

In the opinion of those best qualified to judge, this involves the continuance of private practice. This applies both to consultant and to general practice. It provides a stimulus and flexibility that can do nothing but good, and it is clear from the marked increase in subscribers to hospital insurance schemes since the inception of the service that there is widespread demand for it.

A final advantage of the raising of standards and status of general practice, particularly when it is linked with the development of group practice, would be that it would make it easier for senior registrars for whom no consultant appointment can be found to transfer to general practice. Such a development would do much to help in solving the difficult problem of these registrars.

What is the price of health, and what proportion of its income can the nation afford to spend on its health service? These are fundamental questions on which any consideration of the cost of the service must be based. As Mr. Guillebaud points out in his review of the subject, in 1956-57 the aggregate gross expenditure represented approximately 3.3 percent of the gross national product. It is for the country to decide whether, in relation to other essential items, such as education, housing, defense, and the like, this represents a reasonable amount to spend on the health service. Whatever the answer, however, it is incumbent on all concerned to insure that the money available is spent as economically as possible. In discussing such matters it is too often forgotten that the hospital service accounts for about 60 percent of the gross cost of the service, and drugs for some 10 percent. Much has been heard of the need for bigger and better hospitals; but are these really necessary on the scale sometimes suggested? If general practitioners were enabled to pull their full weight, the need for referring patients to hospitals could well be reduced. Before embarking on an elab

orate program of hospital development, priority should be given to the problem of insuring that as much treatment as possible should be given by the family doctor. At the same time it is incumbent on the ministry to take more active steps to persuade patients and potential patients not to abuse the service by unnecessary calls on their doctors-particularly when these are accompanied by demands for drugs in the category of household remedies which the individual should be expected to buy for himself.

(By Lord Amulree, M.D., F.R.C.P., president, Medical Society for the Care of the Elderly)

During the late war a start was made to improve the conditions in the large number of ill-equipped hospitals in the country. The majority of these had been operated under the Poor law and were then the responsibility of the major local authorities. Little blame, however, should be attached to the local authorities for the state of their hospitals; between 1929 and 1949 major reforms were not, for obvious reasons, practicable. This improvement continued after the war; and when, by the National Health Service Act, the difference between voluntary and municipal hospitals was abolished and all hospitals passed into the possession of the Minister of Health, upgrading of these hospitals continued.

The elderly sick and the chronic sick have benefited and the distinction between first-class medicine in most of the voluntary hospitals and second-class medicine in many of the ill-equipped and understaffed municipal hospitals is passing away. Pioneer work in the rehabilitation of the elderly sick has led to a general appreciation of the fact that age in itself is no bar to efficient and adequate treatment, and that the elderly respond to appropriate treatment in a way similar to that of younger people. This had, for many diseases from which the aged in common with their junior contemporaries suffer, long been known; but the degenerative, long-term diseases of old age, particularly among the poorer, less privileged, class of the community, were thought, all too often, to be resistant to effective treatments, and none therefore was instituted.

GERIATRIC UNITS

It is becoming generally realized that if elderly persons are sick they need admission to as good a hospital as if they were young or middle aged. The elderly sick, no matter from what disease they may suffer, are more and more frequently admitted to fully equipped and staffed general hospitals and are subjected to full facilities for diagnosis and for treatment by up-to-date methods. Geriatric units have been started in about 80 areas and, although there is a certain unevenness in the quality of their work, their presence has been of great benefit to the elderly sick. Most of these units are situated in the former municipal hospitals, and the general unsuitability of many of these-absence of lifts, unsuitable sanitary annexes, and a general lack of amenities-has prevented the work from expanding to the extent it might have done if more money had been available.

The modern conception that it is wrong to keep an elderly person either in bed or in hospital unless there are sound medical grounds for doing so has transformed many of these rather dreary wards into cheerful, active, happy places in which the elderly sick are encouraged to resume a normal life. In addition to adequate medical and nursing care, these patients require the services of an almoner and of occupational and physiotherapy departments. Many return to their own homes, often assisted by the domiciliary service, both statutory and voluntary; but many, whose restoration to health is not so complete, need admission to welfare homes administered under part III of the National Assistance Act.

The number of beds in these homes is still inadequate for the demand, and many hospital beds are filled by elderly folk who no longer need to remain there. Nevertheless, long waiting lists are becoming things of the past, and the system

1 Editorial from the London Times Supplement on the National Health Service, July 7, 1958, p. xiii.

of visiting all patients in their homes before admission has helped to establish a priority of admission for those who are acutely and seriously ill. This helps to prevent them drifting into a state of permanent invalidism when long, and even permanent, hospital care becomes necessary. Under the National Health Service Act all persons are entitled to the services of a general practitioner. Many elderly persons benefit from such services, and the link between practitioner and geriatric service has proved its worth.

The local authority, with its welfare services, contributes the third branch of the National Health Service, and when there is full cooperation between all three branches the lot of the elderly is greatly improved.

The care of the younger disabled, or "chronic" sick, has not shown such improvement, partly because their numbers are relatively small and partly because little progress has been made in the admittedly difficult task of deciding to what type of accommodation they are best suited. Full medical and nursing care is not necessary, but many of the resources of the general hospital are needed-almoners, occupational therapists, and physiotherapists. That some annexe, sheltering under the general hospital umbrella, is necessary for these people is agreed, but its exact nature has not yet been determined. Perhaps the course of the next 10 years will show.

Mr. ALGER. One last question.

Does it not also follow that this program, like so many other of the compulsory tax programs, is hitting the people of modest income? We are going to increase the tax burden of the very people you represent again; are we not?

Mr. CRUIKSHANK. We increase their tax burden, but we do not increase their total economic burden.

Mr. ALGER. That is all, Mr. Chairman.

The CHAIRMAN. Are there any further questions of Mr. Cruikshank?

If not, Mr. Cruikshank, again we thank you, sir, for your discussion of this matter.

Mr. CRUIKSHANK. I thank you, Mr. Chairman and members of the committee.

The CHAIRMAN. Our next witness is Mr. Marshall.

Mr. Marshall, please identify yourself for the record by giving us your name, address, and capacity in which you appear.

STATEMENT OF ALLEN D. MARSHALL, IN BEHALF OF THE CHAMBER OF COMMERCE OF THE UNITED STATES, ACCOMPANIED BY KARL T. SCHLOTTERBECK

Mr. MARSHALL. Mr. Chairman and gentlemen of the committee, my name is A. D. Marshall, and I am vice president of the General Dynamics Corp. I appear before you today representing the Chamber of Commerce of the United States.

For the past 7 years I have been a member of its board of directors and also chairman of its committee on economic security.

Mr. Schlotterbeck at my left here is the staff member who is secretary of that committee.

The CHAIRMAN. Mr. Marshall, you are recognized, sir, for 20 minutes. If you omit any part of your statement it will all be placed in the record.

Mr. MARSHALL. You have my statement on file. I hope I will be permitted to omit parts of it in my oral presentation.

The CHAIRMAN. Your entire statement will appear in the record. Mr. MARSHALL. The national chamber, gentlemen, has long been interested in proper health care and facilities for all Americans. We

have encouraged the insurance industry to experiment with new forms of health protection. We have also encouraged employers to sponsor health insurance programs for their workers.

The U.S. Chamber of Commerce recognizes that with advancing years the likelihood of illness often increases. Chronic or acute illness may involve substantial, even abnormally large, expenses for medical care at any age. This is likely to be a financial problem for anyone, more so for those who have retired.

Private enterprise in recent years has developed insurance protection for the vast majority of working people and their families. The insurance industry is now devising various types of policies to protect those of retirement age.

We have encouraged this activity and believe that such protection can be extended to a large part of our retired people.

The national chamber truly welcomes this opportunity to express its views on this proposal, H.R. 4700, to provide certain hospital, nursing home, and surgical benefits within the framework of social security.

H.R. 4700 would initiate a completely new feature in social security, a service benefit. It would authorize payments from the social security trust fund for the first 60 days of hospital care in a 12-month period, or 120 days in a nursing home including any stay in a hospital, and also for standard surgical procedures.

This new benefit would be provided, as was just pointed out, to all beneficiaries, young as well as aged, on the social security rolls, as well as to those who could draw benefits were it not for the fact that they are earning too much.

There are certain vital features of this bill and the national chamber's views on H.R. 4700 are based on the longstanding purpose of social security, on certain unique aspects and on its fundamental principles which for the past two decades have withstood the tests of critical examination and reappraisal.

Social security is designed to deal with the potential social problem of vast size which might occur if large numbers of older people, because of age, could no longer support themselves by working and might become destitute and in want. Hence this program has provided for monthly benefits, paid without a "needs test," chiefly to those aged persons who can no longer earn a living.

For good reason, Congress decided that the benefits should not be sufficient to cover the most extreme needs of a relatively small portion of the older population, but should be adequate to provide a floor of protection against want and destitution for the vast majority.

For the relatively few whose needs are unusually large because of chronic illness or other reasons, reliance has been placed on old-age assistance to supplement social security benefits. Congress has always expected each person to build more old-age income protection through his own efforts, according to his own desires and ability.

One condition of eligibility for social security benefits has been known as the work test. It is indispensable to this social program which pays benefits to those whose age has taken its toll and, hence, presumably are no longer able to support themselves by working. Over the years, Congress has liberalized this condition of eligibility.

At the present time, a person who has met all other conditions of eligibility but is earning more than $1,200 in a year has no right to monthly benefits throughout the year.

A fundamental principle in social security has been the wage relationship of benefits. This principle has been enunciated several times in the reports of the Committee on Ways and Means and the Senate Committee on Finance. It is typically American to have rewards related to the economic effort involved.

Moreover, it is reasonable that those who had higher earnings in prior years should have a somewhat higher floor of protection against want and destitution.

Another feature, typically American, is that the benefits are paid in cash. It is axiomatic that freedom of choice can be preserved only through cash benefits. Each beneficiary is the judge of what best meets his needs and is free to exercise that decision.

IMPLICATIONS AND POTENTIAL CONSEQUENCES OF H.R. 4700

Perhaps no other proposal for amending social security ever considered by this committee would so drastically alter certain uniquely American features and fundamental principles of this time-tested program.

We do not question the good intentions and motives which give rise to H.R. 4700. As a matter of fact, we share the concern of the people who are concerned with the health problems not only of the aged but of all of the indigent in our population.

However, it seems to us that the implications and seemingly almost inevitable consequences are such that we urge the committee to reject the entire proposal.

First let me point out that by ignoring the work test, H.R. 4700 could make the social tax costs so burdensome as to jeopardize the existing old-age and survivor benefits program.

H.R. 4700 would authorize payments from the social security trust fund for specified hospital and nursing home care and for standard surgery, not only for those actually drawing benefits, aged and young alike, but also those who, otherwise eligible, are working and supporting themselves.

Since this program was designed primarily to pay benefits to those who, because of age, could no longer support themselves by working, Congress has concluded that the objectives of this program would not be served by paying benefits to those who could continue to work beyond retirement age.

Congress has believed there is no social or economic justification for taxing workers and employers to pay cash benefits to those who could continue to work.

Intermittently Congress has liberalized this work test, in consequence of rising pay levels and of some public demand.

Through a misunderstanding of the character of social security, there has also been some demand that the work test be eliminated. Apparently some believe that social security benefits are insurance; that they have bought and paid for these benefits, and that they should receive them at age 65 and not be penalized for exercising initiative by continuing to work.