What bothers me more than our new charging practices, however, is the way in which almost guaranteed payment-in-full is apt to color our medical judgment. For example, I know a 73-year-old woman who has been in and out of the office of every doctor in town for the last 10 years. She always has some complaint, most of the time purely functional. Till last July she was on welfare, and whoever happened to be taking care of her would, for next to no fee, give her the time and treatment she needed. But that wasn't much. She knew she wasn't really sick, and so did the doctor.

Now that she's on Medicare, how things have changed! She spends half her time in the hospital getting expensive diagnostic studies and thorough work-ups by a host of physicians and consultants. Is she really any sicker than she was? Of course not. It's just that now the doctor gets paid for his proctoscopy, fluoroscopy, or his consultations. And who knows? Maybe somebody will find something wrong with her. So the studies can, in the loosest sense, be medically justified. But the main reason she now gets more attention than she used to is that it's all practically free for her-and more lucrative for both the doctor and the hospital. Is it ethical? You tell me.

That woman doesn't happen to be one of the patients I've cashed in on, but I'll admit there have been some. I'm not at all certain, for example, that I'd have taken off one old gentleman's sebaceous cyst if he'd had to pay for it himself. I'd have probably told him not to worry about it, that the cyst would never hurt him. But since he's on Medicare, I wasn't at all reluctant to do the job when he asked me to. I didn't talk him into it, but I sure didn't discourage him. I've noticed, too, that a lot of other men are doing more elective procedures on the oldsters since Medicare came in. Warts are getting burned, moles are being removed, and a few veins strippings of minimally dilated varices are getting onto the schedule. Some of these may help the patients substantially, but many of them aren't strictly necessary. If it weren't for Medicare, they probably wouldn't be done.

The fault, of course, is not completely ours. Now that the oldsters are on Medicare, they can demand that things be done for them--and they do. After all, haven't they got a right to Government-financed medical care? Didn't Uncle Sam say they could have their warts burned, their cysts removed, their veins stripped-and he'd pick up most of the tab? Then who are we doctors to deny them what the Great Society has bestowed on them? When you consider these pressures, it's not difficult to understand why some physicians give in and take the easy-and remunerative-way out.

Hemoglobin determinations, urinalyses, blood sugars, and the like are all increasing in frequency. It's possible to argue that more such tests should have been done in the past than were done, and I won't disagree. Still, I'm as certain as I can be that a lot of unnecessary checks are being run. I've seen them, and, very possibly, I've ordered some myself.

I say "very possibly" because this whole area is a nebulous one. It would take a utilization committee full of Clarence Darrows to prove that a hemoglobin, a urinalysis, a proctoscopy, or even an exploratory lap was completely unjustified. In medicine things just aren't that black and white. It's difficult for even the most conscientious doctor who orders a procedure to be certain that somewhere, deep down in his subconscious, his judgment isn't being influenced by the money he's going to make-maybe just a little.

Lest you think I'm being picayune, let me remind you that the degree of our cheating-if that's indeed what it is-has little bearing here. Those of us who order unnecessary hemoglobins because Uncle Sam is paying are not in a good position to criticize the few who perform unnecessary hysterectomies on Medicare patients. Remember the story attributed to George Bernard Shaw about the woman who agreed that she'd sell her favors for $100,000? When asked if she'd do it for $2, she answered, "What do you think I am?" His reply was: “Madam, we have already established that. We are now only quibbling over price."

We're all intelligent enough to know that Medicare isn't free. One of the main reasons we fought it so strenuously is that we know Government programs are inevitably wasteful and expensive. Eventually, through our taxes, we'll pay through the nose for this one. But an immediate result of Medicare is that it enables us to increase our incomes. When we're greedy and shortsighted, and succumb to the practices I've mentioned, we tempt fate. Injudicious behavior on our part may not only bring rigid Government control down on our necks but, more lamentably, may also destroy the ethical standards of medical practice we've fought so long and hard to maintain.

Senator SMATHERS. Mr. John W. Edelman and Mr. William R. Hutton, president and executive director, National Council of Senior Citizens, and Mr. Frank Wallick.

We are delighted to have you gentlemen here, as is always the case. You may proceed as you like.

STATEMENTS OF JOHN W. EDELMAN, PRESIDENT, AND WILLIAM R. HUTTON, EXECUTIVE DIRECTOR, NATIONAL COUNCIL OF SENIOR CITIZENS; AND FRANK WALLICK, LEGISLATIVE STAFF OF THE INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE & AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, UAW

Mr. EDELMAN. Mr. Chairman, in case you have not met them already this is Frank Wallick of the legislative staff of the international union, United Automobile, Aerospace & Agricultural Implement Workers of America, UAW, who is testifying here today on behalf of Mr. Andrew Brown who is in charge of the retirees' section of his organization. On my left is Mr. William R. Hutton, executive director, National Council of Senior Citizens, who will in great measure carry the burden of this testimony. I will make a very brief statement.

I am John W. Edelman, president of the National Council of Senior Citizens, an organization comprising roughly 2 million members dedicated to building a better life for all the elderly in this country.

I mention in passing, sir, that I am also a "victim witness" in this instance. I have had two spells in the hospital as a patient under medicare program.

We of the National Council of Senior Citizens welcome the attention being focused on health needs of the elderly by the distinguished members of the subcommittee. We appreciate the wealth of knowledge and experience being brought to bear on this problem by the chairman, Senator Smathers.

Senator SMATHERS. Thank you very much.

May I say here that looking at you after you have had those two experiences in the hospital it is evident that you are getting quality medicine.

Mr. EDELMAN. Thank you, sir. I think that is exactly true.

As you must know, our organization was in the forefront of the legislative campaign for medicare and medicaid and our members are profoundly grateful to the Senators and Members of the House of Representatives responsible for enactment of this monumental legislation guaranteeing 19,300,000 who are over 65 hospital care up to 90 days for a spell of illness and 17,600,000 of this group who signed up for optional medicare doctor insurance payment of a major portion of their doctor and medical bills.

This has resulted in a tremendous upgrading of medical care available to the elderly. However, I must in all honesty remind the distinguished subcommittee members great numbers of elderly are being excluded from the benefits of medicare and medicaid. Those being excluded are the ones most in need of adequate health care.

There are no reliable estimates I know of as to the number of elderly thus excluded from medicare and medicaid benefits but the number may run into millions.

WIDESPREAD POVERTY AMONG ELDERLY

Secretary John W. Gardner, of the U.S. Department of Health, Education, and Welfare, told the recent annual convention of the National Council of Senior Citizens in Washington that nearly 10 million, or nearly half those 65 or over, are poor.

They are poor, Mr. Chairman and distinguished members of the subcommittee, largely because they have to depend on inadequate social security benefits for their support.

Now, I ask the subcommittee members, can anyone getting social security averaging $84 a month-that is a meager $1,008 a year—find cash for the $40 payment required for hospital admission, the $50 downpayment required on doctor bills, the obligation to pay a fifth of remaining doctor bills, and the $20 payment required for outpatient diagnostic care under medicare?

We just simply think this is impossible for a great many of the persons eligible for medicare simply on the grounds of inadequate income. Senator SMATHERS. It is obvious by your statement but I just wanted to connect this up with your previous statement that there is a large number who are not eligible to get the benefits of the medicare and medicaid programs.

Mr. EDELMAN. That is correct, sir.

Senator SMATHERS. Because of the deductible.

Mr. EDELMAN. That is our view.

Senator SMATHERS. Very well.

Mr. EDELMAN. For vast numbers of the elderly, a ride costing 50 cents for a trip downtown is a luxury they can scarcely afford. Where will they find the cash to meet these costly medicare deductibles?

FOOD OR HEALTH CARE

Undoubtedly, many of the 1,700,000 elderly who refused to buy medicare's $3-a-month doctor insurance did so because they realize they cannot meet these high-priced deductibles. They had a grím choice between having something to eat and getting health care they might need but could not afford.

Just on this point, Mr. Chairman, could I mention that I got a letter the other day from a social security beneficiary in Philadelphia. She was telling me her only means of support is a social security monthly benefit of approximately, I think, $34 a month. And of this money she is now receiving, $3 of course is being deducted, so actually all her income is about $31 a month. She said she has been going to the doctor for some relief for a nervous condition and he has been prescribing to her certain pills, she said, which makes things worse. She writes to me Mr. Chairman, this is a terrible tragedy-saying, “How can I get out of having to pay this $3 which I was told would benefit me so that I could use this $3 for food which I know would benefit me?" I felt under obligation to write to her and explain what the law says about this situation. It will take her some little time, I believe this October, before she has an opportunity to withdraw from this program. I pointed out to her I thought it would be disastrous if she would render herself ineligible for these medical benefits.

True, medicaid, the health care program for the medically indigent, supplies cash for medicare deductibles in 28 States if-and that's a big

if-applicants submit to a means test. But what of the elderly in the 21 States that do not have medicaid?

Even in the States with medicaid, I am sure there are many elderly who proudly undergo great privation rather than submit to a means test. These are men and women who were most of them self-supporting until excluded from the labor force on account of age.

Upon leaving gainful employment, they were forced to join that other America, described by Michael Harrington, an America of poverty, deprivation, and disease.

A year's experience with medicare and medicaid shows that medicare and medicaid have bypassed a great many men and women they were designed to help.

What can be done?

DEDUCTIBLES, DRUGS CAUSE PROBLEMS

We of the National Council of Senior Citizens urge with all emphasis at our command a phasing out of the medicare deductibles. The way it is now, with deductibles and other restrictive medicare features, we offer the elderly modern health care with one hand and snatch it away with the other.

Even with the increase in social security now being considered, the medicare deductibles will remain a barrier to adequate health care for large numbers of older Americans.

Proper health care takes in vision, hearing and dentistry. Yet, medicare excludes eyeglasses, hearing aids and dental care. These items must be covered if we are really going to bring modern health care to the elderly poor.

The exorbitant prices often charged for drugs are another obstacle in the way of modern health care for the elderly. Drugs the elderly must buy-four out of five elderly have chronic ailments should be brought under the medicare umbrella.

Who will pay for these improvements?

We of the National Council of Senior Citizens insist our prosperous land can and should pay for them out of general taxation, generally income taxes.

I am glad to note that the Health, Education, and Welfare Department has called a conference for June 26 and 27 in Washington to discuss these critical matters.

My colleague, Bill Hutton, executive director of the National Council of Senior Citizens, is close to the problems of rising health care costs. Daily, he and I see desperate letters from our members telling of their medicare problems. I would very much like to have him present his observations to the subcommittee. I thank you for the privilege of appearing before you.

Senator SMATHERS. Thank you, Mr. Edelman, for that splendid statement. We are happy that you are back feeling well and could make it. That is a fine statement.

Mr. Hutton, you may proceed.

STATEMENT BY MR. WILLIAM R. HUTTON

Mr. HUTTON. Senator Smathers, members of the National Council of Senior Citizens do not spare themselves in recognizing that medi

care and medicaid are doing more to break down the barriers to ade quate medical care for older people than any other steps that have been taken in the history of American medicine and in the history of our social legislation.

But it is precisely because we believe that the organization and delivery of medical services to every American citizen may be changed dramatically by the impact of these programs that we are glad to submit the following observations.

Through its enactment of the Social Security Amendments of 1965 which included these important health programs, the U.S. Congress clearly recognized that the problems of medical care for the aged are more severe than for other age groups.

Though we are intensely grateful to Congress for the enactment of these programs, we have had plenty of opportunity during a full year of their operation to realize where they fall far short of the minimum that is needed to make good health a reality for many aged citizens.

Nevertheless, we want to emphasize that in our goal to seek a better life for all older Americans the National Council of Senior Citizens is extremely conscious of the national interest. This concept of seeking improvements for the elderly within the framework of the national interest is one, Mr. Chairman, which has brought recognition of our organization by the Members of this Congress as a responsible voice of the elderly people of America.

"RUNAWAY COSTS" OF SERVICES

We are desperately concerned about the health care needs of the elderly. We are just as desperately concerned with unnecessary, unrealistic, "runaway costs" which are forcing up the price of health care, not only to elderly people themselves, but for their sons and daughters and for their grandchildren.

Ever since the spring of 1965-when it became clear that medicare was going to be enacted-the National Council of Senior Citizens has been warning Congress that soaring hospital costs and spiraling doctor fees pose a dangerous threat to the program.

We believe quite sincerely that this is currently an economic threat and not a political one. Something must be done to halt the rate of health cost increases. We must work to control costs and improve efficiency without sacrificing the quality of care. While to some degree this calls for the understanding and cooperation of the people who will use the care, it calls more seriously we believe, for restraint and judgment by those doctors who are willfully and flagrantly raising their fees on the theory that "Uncle Sam can afford it" or who are inflating their fees because a patient happens to be privately insured.

It is understandable that some hospitals which are belatedly meeting staff demands for needed increased wages are having to meet higher costs. It is also clear that there are wasteful and extravagant practices in many of our health institutions. Inside and outside of Government there is a great need for built-in incentives to control costs. Mr. Chairman, in your Senate statement on June 7 announcing these hearings, you asked a number of questions to stimulate discussion con