My objections are not based on a callous disregard of a problem that exists. The problem itself exists but its urgency and extent has yet to be defined. Moreover, the issue presented by H.R. 4700 merely adopts one course of action in meeting the problem which, in my opinion, would have ultimate unfortunate consequences. I would reject any attempts to interpret opposition to the course of action as proposed as an objection to hospitalization and nursing home care for our older population.

I subscribe to the viewpoint of the Secretary of Health, Education, and Welfare, Arthur S. Flemming, who testified before your honorable committee on July 13, 1959, to the effect that such a plan as proposed would ultimately eliminate voluntary insurance plans. In this respect, I would respectfully call the attention of the committee to the increased activity and efforts of private insurance carriers within the last few years in making hospitalization coverage available to our older population. I feel that this is a salutory beginning, that satisfactory further progress will be made in this area and that the public will accept the coverage offered. In support of this, I would cite the forecast of the Secretary of Health, Education, and Welfare contained in his report dated April 3, 1959, to this committee that, if health insurance coverage of persons aged 65 or more continues to grow as it did during the period 1951-57, approximately 70 percent of this group would have some form of health insurance by 1965. Although the coverage and benefits provided may not expand as quickly as desired in some quarters, I submit that the normal steady progress obtainable through private initiative rather than governmental direction is the more desirable course.

I support the further viewpoint of the Secretary of Health, Education, and Welfare, as presented in his testimony before your committee, for Congress to await a report on current studies to determine what role the Government should play in developing old-age health plans which would be both practical and desirable. The adoption of this viewpoint does not necessarily mean that it is hoped that dilatory tactics may avoid meeting the problem. Rather, it is a supplementary viewpoint that forthcoming studies may indicate that ultimate coverage should be provided through private sources.

I would urge that the committee refrain from adopting new and different programs to be financed through social security taxes. There is in old-age and survivors insurance and disability insurance some connection with employment. In the former instance, there is a wage-related pension benefit and, in the latter instance, a wage-related benefit replacing wages lost through disability. However, the incident of illness of a retired person, his dependents or survivors, is not connected with employment or prior employment. Thus, the inclusion of the program contemplated by House bill No. 4700 under title II of the Social Security Act is inimicable with the basic purpose of the title. The program contemplated should be financed, if at all, through general taxation rather than by specific excise tax such as the social security tax. The fact that the social security tax collection and administration processes present an easy way to finance the contemplated program should have no substantial bearing in this matter.

I question the wisdom of including the contemplated program, which involves comparatively unpredictable costs and contingencies which are not susceptible to application of actuarial techniques, under title II of the Social Security Act. H.R. 4700 provides for the commingling of trust funds. The increase in the social security tax, if levied, should be sequestered and placed in a separate trust fund similar to the disability trust fund. The financing, benefit payments, and administrative costs should be segregated so that experience under the program can be readily reviewed and evaluated. This suggestion, of course, does not alter my basic opposition to the contemplated program. Another reason for opposing H.R. 4700 is the existence of the social security title I program of old-age assistance, which already provides the mechanics for vendor payments for medical care for the older population which is in need. At least, the basic purpose of providing medical protection for older persons is already in operation under title I and it does not discriminate between those who are and those who are not covered under title II of the Social Security Act. This existing method is, at least, a more equitable manner of meeting the problem through Federal Government action. In this connection, the committee should take into consideration that vendor payments for medical care for those receiving old-age assistance during the fiscal year ending June 30, 1958, amounted to $165 million (see table 3, Social Security Bulletin, March 1959). It would not be amiss to

mention that substantial support of H.R. 4700 seems to come from those who are dissatisfied with the progress under title I and who wish to replace some element of State governmental discretion under the program with centralized governmental control. The choice of title I rather than title II as a more appropriate means of meeting the problem should not be interpreted as support of the former (title I) as a vehicle for meeting the problem.

H.R. 4700 proposes to increase the social security tax on employees onefourth percent; on employers, one-fourth percent; and on self-employed individuals, three-eighths percent. It proposes up to 60 days full hospital benefits and 120 days of nursing home services less those days of hospitalization in a 12-month period. The attention of the committee is respectfully directed to pages 76 through 89 of the April 3, 1959, report of the Secretary of Health, Education, and Welfare to the committee. On page 87, it is estimated that the level-premium cost of a 60-day hospital full benefit, as developed by the Social Security Administration in conjunction with the HIAA (Health Insurance Association of America) estimates, would require a 1.5-percent tax rate. Furthermore, on page 88 of the report, it is estimated, in a similar manner, that the 120-day nursing home benefit less up to 60 days hospital care would require a 1.16-percent tax rate. Thus, in effect, the proposal under H.R. 4700 would appear to be grossly underfinanced from a long-range level premium cost basis.

Under the 1958 Social Security Act Amendments, the tax base was increased from $4,200 to $4,800 and the scheduled tax rates were increased as follows (when compared to the act prior to amendments):

One-fourth-percent increase in 1959-61, 1965, and 1975; three-fourths-percent increase in 1963–64, 1966–68, 1970-74; 14-percent increase in 1969.

The further one-fourth-percent increase in the tax rates as proposed in H.R. 4700, though insufficient from a level-premium cost basis, would cause a threefourths-percent increase in the 1960 tax rate over the 1959 tax rate-an additional $36 annual ($3 per month) tax bite out of the wages of each employee making $4.800 or more. This comes on top of the 1959 additional annual $25.50 ($2.12 per month) tax bite out of the wages of each similar employee. This acceleration in tax which has already begun, when coupled with the widespread increases in State income tax levies which have occurred in 1959 present a serious problem to employees and their families and to employers. The matter of allocating disposable or spendable income after taxes is a critical matter facing all strata of our society. Continued encroachment of taxes upon such income may only result in stultified standards of living. I submit that the currently employed individuals are, as a matter of self-interest, more concerned with providing for the immediate and pressing needs of day-to-day living than they are with the defraying of the medical costs of the illnesses of the current OASDI beneficiaries.

It is no longer valid to evaluate legislation on a piecemeal basis. The total effect of all legislation involving taxes must be considered as a whole. Accordingly, it is respectfully submitted that this honorable committee should balance the respective interests of the entire population with the interests of the smaller group for which benefis are proposed under H.R. 4700.

Hon. WILBUR D. MILLS,

HOUSE OF REPRESENTATIVES,
Washington, D.C., July 16, 1959.

Chairman, House Committee on Ways and Means, House of Representatives, Washington, D.C.

DEAR CHAIRMAN MILLS: I am taking the liberty of enclosing a letter which I have received from Dr. John O. Austin, Garden City, Kans., together with one which has been transmitted to him by one of his patients, Catharine Warren Brown, a former resident of England and now residing in Garden City. This correspondence pertains to H.R. 4700 now under discussion by your committee. Will you kindly make the enclosures a part of your committee hearings on this measure?

Thanking you in advance and with all good wishes, I am,

Sincerely yours,

J. FLOYD BREEDING,
Member of Congress.

The Honorable J. FLOYD BREEDING:

GARDEN CITY, KANS., July 13, 1959.

I am enclosing a letter from one of my patients giving her views on socialized medicine in England. These remarks are pertinent to the hearings now underway on the Forand bill.

In addition to the usual comments being made about threats of third party interference and loss of freedom of choice, I would like to point out one other factor. Americans already know how much it costs to be sick, but they often do not know how much Federal taxes they are paying. The price tag on the Forand bill is high. Each worker should be told that by 1965 this program alone will cost him $285 per year if his annual income is $6,000.

Who cannot buy a retirement income program with medical coverage at that price from independent companies even now?

JOHN O. AUSTIN, M.D.

GARDEN CITY, KANS., July 13.

DEAR DR. AUSTIN: Here are some of the main facts about socialized medicine as it is carried out in England. I sincerely hope that they may be of some use, or interest. It is of course a rather vast and complex setup for a lay person like myself to write about. The facts I give you are those gleaned and seen through years of contact both in work and as a patient and friend of many doctors. Four of our best friends are leading abdominal surgeons and gynecologists all of college hospital lecturer status, five others are general practitioners.

As an English person who has left England to make a home here to escape the welfare state, it causes some dismay to read and hear of the Forand bill and a scheme that will obviously lead to socialized medicince here.

The scheme in England was first dreamed up by a kindly but impractical M.P. called Beveridge, after the war, the Labor Party used this plan with far more drastic promises, as a vote-catching stunt. It appealed to a great many people, especially the average man and woman who have a kind of mystic never never land belief in the good of all things that sound free.

The only people who saw the pitfalls were the doctors themselves.

Their reluctance was not due to any financial change which was bound to take place, in fact, under British B.M.A. rules no doctor has ever been allowed to refuse a patient treatment due to their lack of funds. They were struck off the rolls if money was prearranged. Only in the case of a consultant physician or surgeon seeing patients in his private rooms were fees discussed. The same men could always be seen on their consulting days in the hospitals they gave time to, and without charge. Also without any feeling of charity. They were great men who worked long hours for nothing, but those who could afford of course paid fees.

Working people in England, prior to the national health scheme, were bound by law to be covered by insurance which paid for hospital beds and out-of-work pay. It all worked very well and people had a greater feeling of responsibility on both sides. If people wanted private treatment their fees were always tailored to fit their means.

Above all, there was always the strong personal bond and interest between doctor and patient which always exists when people live on a mutual trust basis. Now, under the health scheme, all this has gone. The doctor with a formerly good town practice is often worse off financially. Their income is based on an annual capitation fee of 15 shillings, about $2 a head. Plus some car and gasoline expenses and in some cases a secretary-bookkeeper. This means that often they have to take as many as 3,000 people onto their list to get a living income. The country practitioner is sometimes better off then before the health scheme: he may not have as many patients but his expenses are lower and he is sure of a set annual income. In all cases it means that all the good doctors have too many patients to give real individual care to, while the not so good doctor with a straggling number of patients is still sure of his income without making much effort.

Country doctors in the past had many patients they often sent no account to if they were poor, and they were always looked after with the same kind interest as fee-paying patients. Now, of course, the doctor is just a civil servant: he has few rights, is grossly overworked, and most of them have a feeling of deadly frustration. They have to do things by law which previously they did willingly as part of their work.

A large number of patients call up at any hour day or night. If the case is not urgent and the doctor asks them to wait until morning, 9 times out of 10 the patient writes an abusive letter about the doctor to their Member of Parliament or the Minister of Health. Quite often, after a visit from some pompous jack in office, the doctor is fined.

In spite of all this, if a doctor begins to feel he would like a change of district or county, he can no longer sell his practice but has to apply to the minister for a change. Those doctors who were in practice before the scheme, often had paid large sums for a practice. They received very little compensation when the State took over.

All the minor surgical care a doctor attended to in his own surgery now has to go to hospital outpatients department. There, of course, one waits one's turn for hours, for a stitch or shot of penicillin. A bored clerk takes down your name, address, age, next of kin, number of children, previous treatment, and all this is filled onto forms in triplicate, white, pink, and blue. When you have nearly bled to death or are almost screaming with tiredness and almost sent to a physchiatric ward, someone arrives at a strategic moment with a note to a doctor and you get your suture or shot.

Then, in the doctor's waiting room, now that he is a civil servant and therefore no longer ranks with human beings, he and his house and rooms are public property. I have seen two women sit over the gas fire in the waiting room knitting, when called by the receptionist, they just said, "they were bored, their husbands were out, they had seen the local movie, and to save lighting their own fire, thought they would visit the doctor." Some people even wait for trains there if the poor doctor is near the railway station.

Others go for anything free they can get from the most intimate needs to crepe bandage or elastic stockings for their wretched varicose veins, mainly aggravated by walking daily to the doctor for something new or free.

The weekly insurance stamps cost everyone an equivalent of $2,50 a week. This is out of an average income of $30 a week. Each patient pays 1 shilling for every prescription—that is, about 20 cents; this covers every medicine or drug, dressing, or appliance.

Needless to say, while the people's stamps are high enough, the national health debt to the treasury annually is several millions sterling.

At this rate, something, somewhere, will crack. Taxation has broken most people. Income tax is high. During the Labor government, supertax was 19 and 6 in the pound, which is 20 shillings. Death duties are fantastic-over 50,000 pounds, it is 75 percent. My husband's father's death duty came to $158,000. It broke us. Large portions of the country's death and estate tax goes to subsidize this wild nightmare, the welfare state. On the whole, the hospitals are well run, but unless one gets into one of the old teaching hospitals where tradition still lingers, you are no longer human, but a number in a bed. The personal bond has gone, unless you are lucky and live in the country-the numbers are fewer and the doctor is still a friend. We always tried to respect his time off and save him journeys, but not many people do.

When the health scheme first started, the state even dictated the type and pattern of instruments used. Most surgeons had some pet instruments of their own design.

To get a bed in the case of serious illness or major surgery, we always went privately to doctors and specialists. It gets you a bed in a private hospital, but the surgeon is still always pressed for time as the hospitals are filled with very trivial cases which, before, a doctor looked after himself in his own surgery or office.

The worst aspect as a long-term policy is the complete lack of responsibility the health scheme has brought. Families no longer look after their old people, their doctors, in desperation, send them to hospital, and surgical, and sometimes obstetric blocks are overflowing with old people who have nothing really wrong, but cannot be alone.

It is well known that if a leftwing Labor Party were returned to power, it would not be long before legalized euthanesia would come in.

The doctors who were brave enough to stage a protest in 1948 were threatened by the Labor Minister of Health with dismissal, and replacement by 2,000 Czechoslovakian doctors seeking political asylum.

It is very embittering to someone solidly English to know that such things can, and did happen, and are glossed over and kept undercover. It is an unhealthy state of apathy that 50 years ago, any politician suggesting such powers would have been firmly ducked in the nearest horsepond.

These schemes sound good and rosy and benevolent, but they always run wild and financially break any country.

I hope these comments may be of some use and I apologize for their length. It would be a real tragedy to see a doctor like yourself being owned by the state.

Yours very sincerely,

CATHARINE WARREN-BROWNE.

(Whereupon, at 3:20 p.m., the hearing in the above-entitled matter adjourned.)