control and compulsion which goes against the grain of anybody that feels like America is great for the things that it was founded for, that's freedom and free enterprise.

Senator LONG. Well, of course, you know that the Kerr-Mills bill has now been implemented in only, I believe, 21 States, at least not in Missouri.

Dr. KNABB. I didn't state in my report here—it is in the report that I submitted, however-that this is being considered by a special committee at this time and we hope that we are going to come through with some good results.

Senator LONG. Senator Cason is, I believe, chairman of that committee. That has probably been up before our local legislators before.

Dr. KNABB. I left out that part because I thought we were going to run late on the next two speakers.

Senator LONG. Only one more point I want to make. I notice you raise the question that the King-Anderson bill for the first time would violate the principle of providing social security benefits in cash as compared to furnishing goods and services. That is not an unusual principle, though, doctor, in furnishing goods and services because I believe your own Blue Cross and Blue Shield does not pay cash to the patient but pays the doctor and the hospital for the goods furnished. Isn't that right?

Dr. KNABB. Well, I would say that we are opposed to more controls, more compulsion, and we feel that this particular proposal is going to get us deeper in the hole.

Senator LONG. Doctor, let me ask you this question, then, and I have asked the other doctors this and I am serious about it. The point that I cannot understand in the doctors' position on this, and I think perhaps it is not the fear of the immediate King-Anderson bill, I think it is a fear that's projected to the future, that to me, I can't understand the doctors' fear or hesitancy of taking a fee for their services, whether it is money that I have earned, money I have inherited, money I got from dividends, money I collected from interest, money I collected from a private insurance policy, or money that is paid to me by social security. You do take your fees now that are from social security money that is paid to patients. Would you comment on that? It is not the fear of that principle that's involved: it is the apprehension that it will lead to something else, isn't it?

Dr. KNABB. Well, it seems like I go right back to the same thing. We are opposed to any further controls and anything that is sponsored by the Federal Government-not sponsored, but any money that the Federal Government puts out, there is going to be something wrong if they don't have the jurisdiction over how that is used and have controls over it.

Senator LONG. Well, there is nothing wrong, though, with the present social security system that pays the patient $75 a month and then they take that money and pay a fee or hospital bill with it.

Dr. KNABB. We are opposed to any further controls.

Senator LONG. Would you be opposed to the King-Anderson bill if it provided, which, incidentally, it has a $90 provision that the patients must pay themselves first so there won't be promiscuous use of medical services would you be opposed to that type bill as a profession, doctor, if medical care was, some arrangement would be made where

part of that money would be paid to the patient for the bills that the doctors or the hospitals might give them and then assigned to the doctor or paid to the doctor possibly? That would be the same principle as our social security system today.

Dr. KNABB. Well, for the same reasons we are opposed to further Federal controls, further compulsions. The King-Anderson bill is going to be a compulsory thing if it is passed; that's why we are in favor of the Kerr-Mills bill, which is voluntarily based on local needs, and we think that the local people right here in Springfield, in Greene County, can determine our own needs better than somebody in Washington, D.C.

Senator LONG. You doctors would still determine the need for the hospital care and the medical care. If the patients didn't need the care the doctors wouldn't give it to them. If they didn't need hospitalization they certainly wouldn't admit them to the hospital.

Dr. KNABB. Will you agree that if the Federal Government puts out increased funds for social security or for the King-Anderson bill that they are going to have a certain amount of control over that; is that right?

Senator LONG. I think nothing more than they will offer in the KerrMills bill.

Dr. KNABB. That is going to be regulated by the State.

Senator LONG. On the same principle, doctor, there is that statement that is always made, anything the Federal Government contributes to they always see where it goes.

Dr. KNABB. We have to get right back to the fact that anything the Federal Government has comes from the local people: The Federal Government has nothing but what comes from all of us people right here.

Senator LONG. That's true. Of course, on your Kerr-Mills, half of it comes to the Federal Government from the local people, but the other half would be paid out of general revenue, out of the taxes that would be taxed to me and you and everybody else who pays taxes in that State, while the King-Anderson bill and the social security system, the individual himself has made a contribution for his half, his employer the other half, and would not actually increase our general taxes, but half of the Kerr-Mills bill costs will come from the general revenue of the States. I promised not to ask you any more questions awhile ago, so I will quit.

Dr. KNABB. Well, I would say we want to help these people in the best way that need help, but we have to be opposed to further governmental controls.

Senator LONG. Doctor, thank you so much.

Dr. KNABB. Thank you.

Senator LONG. Mr. Gordon Wheatley, chairman, District 18, International Association of Machinists.

STATEMENT OF GORDON WHEATLEY, CHAIRMAN, DISTRICT 18, INTERNATIONAL ASSOCIATION OF MACHINISTS

Mr. WHEATLEY. Senator Long. Congressman Hall, members of the Committee, I am general chairman of the Railroad Machinists and I deeply appreciate the opportunity to give labor's views before this committee, which I consider a demonstration of true democracy across

our land on a vital problem affecting so very, very many people today. My occupation brings me in contact with many retired people, members of labor organizations and others, also many people who are approaching the age of 65 and who have come to consider this problem of nursing home care for the aged as indeed one of our foremost questions, because the cost of medical care is most important to this aging group, and it is understood, of course, that proper nursing homes can be used when hospital care is not mandatory.

According to a booklet of the U.S. Department of Health, Education, and Welfare, our nursing homes should be capable of providing skilled nursing home care and related medical services. And the services offered should be under general direction of a person licensed to practice medicine. The long-term hospital patients could easily be moved to nursing homes when hospital services are no longer required. Let's look at what a subcommittee of the U.S. Senate found when it went into nursing homes in Boston, Pittsburgh, San Francisco, Miami, and Grand Rapids. These homes contained 450,000 beds, in various types of institutions, classified loosely as nursing homes. Only half of them provided skilled nursing services and of this half with the nursing service, just half of these met the Hill-Burton standards for safety (fire), sanitation and design. Three out of five had no registered or professional nurses, one out of three had not even a practical nurse. Found three men, two in wheelchairs, in narrow foyer entrance, and stale odor seeping from under doors, place dirty, and 17 elderly patients lived there, cared for by practical nurses. These elderly patients paid $150 to $200 per month for room and board, with medical bills and drugs extra.

In most States overcrowding was found. In one of two rooms on the first floor of a two-story frame house, five elderly patients lay in beds, separated by such small aisles that hardly enough walking space remained. This was only allowable, it was explained, on account of high-ceiling rooms. This home was clean but rates were $250 to $350 per month.

In many homes the patients were bed fast and some lay dozing while others stared at the ceiling. In one dark cubicle of this home lived a couple; wife, 83, sat on the only wooden chair, husband, 99, lay silently on the bed, and upstairs a 79-year-old crippled arthritic man sat fully dressed on his bed reading a bible. His only visitors, he told the committee, were his sons who came on Sunday and the welfare department doctor who comes once a month. In a nursing home filled to its 45-bed capacity there was a full-time registered nurse in charge, room was clean and had fresh atmosphere.

As of the first of this year, the Hill-Burton hospital and medical facilities survey of nursing homes in Missouri showed a serious need. With a total of 15,136 nursing home beds, 43 percent or 6,518 of them are rated unacceptable based on our State basis of fire and health hazards. Missouri has only 1 acceptable nursing home bed for every 58 persons over 65 of age.

The growth of the aged population in the United States today has led to increased concern about this problem. Between 1950 and 1960 Missouri's population 65 and over increased 24 percent, while the total State population only increased 9 percent. Those over 85 increased 54 percent in just 10 years. Our State has over a half million aged persons and the U.S. census shows 1612 million Ameri

cans have not passed 65 and will increase one-third million a year and by 1965 we can expect 22 million in the United States. More grandchildren today know their grandparents and are concerned about them than ever before in history, because of our increased length of life.

At the beginning of 1961, 60.5 percent of all over 65 in Missouri were receiving social security payments. The average was $71.34 a month, but over 37 percent of these received less than $60 per month. In July 1961, 112,943 aged people in Missouri needed some help from the old-age-assistance program. Such help in the form of payments to doctors, hospitals for medical care averaged $1.42 for the month. Missouri's old-age program, in cooperation with the Government, is limited to recipients of old-age assistance.

This problem of our senior citizens, paying for nursing home service medical care, will increase and concern more families, over a longer period of time, as we go on, unless we take steps in the right direction to solve it.

Statistics now show that elderly people, even with their limited means, spend more after age 65-yes, twice as much-for medical care, nursing care, than those under 65. It's common knowledge that as people grow older their need for nursing home care and medical care grows greater.

The health information shows that in 1957-58 men and women over 65 spent an average $177 annually for medical care, while those under 65 only averaged $86 annually. And remember this is what was actually spent, not what should have been spent. There are no figures to measure how many millions of our retired citizens do not seek or get the medical care they need simply because they cannot afford it. The facts show the vast majority over 65 cannot afford the medical and nursing home care they need because they have reached the time in life when their incomes are severely reduced.

Of the 15.3 million individuals 65 and over who are not in institutions, in 1959, 55 percent had annual incomes less than $1,000. Another 23 percent incomes from $1,000 to $2,000. In other words, only 13 percent of all people in the country 65 and over had over $3,000 per year incomes.

This is indeed very significant, because the Bureau of Labor Statistics shows that a retired couple needs an annual income ranging from $2,390 in Houston, Tex., to $3,112 in Chicago, Ill., just to maintain a modest but adequate standard of living-if they had no unusual medical or nursing home care. Therefore, when we compare the actual incomes of the aged with the Bureau of Labor budgets, it becomes convincingly clear that a large majority of our retired population simply cannot afford to pay for medical care, nursing home care, with the incomes they have.

Some might say, why not private insurance? Because private insurance has never met the problem and never will with its built-in limitations. Congressman Dingell, of Michigan, testified last year that only 40 percent of all Americans over 65 have any form of health insurance at all. The Secretary of Health, Education, and Welfare admits that some of the coverage is inadequate. From the experience of some of our members, we know it's downright deceptive. Many policies are cancelable at option of company and this comes to pass after about the first time the first spell of sickness occurs.

As we have seen, the elderly are the least healthy group in our population and until this problem got a lot of publicity it was practically impossible to obtain noncancelable health and accident policies for people over 65.

The McNamara committee found that of people who had insurance before 65 but did not keep it up-31 percent could not afford it-20 percent had group plans that could not be converted at retirement and 13 percent had been canceled by insurance companies. Private insurance by its very nature will always be inadequate to meet needs of people over 65.

We cannot in good conscience sweep this problem under the rug for millions of our elderly citizens, that have worked a lifetime building our Nation and who during their twilight years deserve to live with dignity and self-respect, not subjected to a means test, charity, nor the grudging aid of relatives. And not forced to use up their meager savings or wasting their small incomes on high priced insurance, often useless, or turning to children or the pauper's oath. It's evident most elderly people do not have the income to pay for nursing home or medical care. Some say that's true-but why not use their savings? We do not believe it's right for a country as wealthy as ours and as industrially advanced, to require citizens, who have contributed to the Nation's wealth with a lifetime of labor to take a means test-to qualify for token medical-nursing home care in their old age. As a matter of fact, many of these old people are close to the bare edge of subsistence already as most retired people have little or no savings. Federal Reserve Board, in 1959 survey, showed that 8 million families, in which the head was 65 or over, 29 percent had no liquid assets-17 percent from $1 to $500 in reserve, and 21 percent from $500 to $2,000. Actually, 67 percent, or total of 5,630,000 families had savings of less than $2,000. Now anyone who has had experience with illness, prolonged, or spent a few days in a hospital knows how fast $500 or $1,000 can be absorbed by medical bills. So any of these 5,630,000 families could be quickly wiped out. Therefore it's not right we require any American to sacrifice his home, his car, his savings and his pride because he needs medical, nursing home care. Not when we know how to spread the risk through a sound system of social insurance under which all will benefit and none need to suffer.

What's the answer? It lies in a program that spreads the cost of high risk old-age insurance over the entire working life of the insured: it's social security-railroad retirement plans. It's a medical, nursing home care plan that continues with us into retirement and does not end when we quit work. It's an answer that has already been accepted by many other civilized and industrialized countries of the world. Medical care has been brought within reach of workers in England, France, West Germany, Switzerland, Scandinavia, and Italy through the principle of social insurance. Some others, such as India, Japan, Greece, with resources far below ours, have gone much further than we have in the United States to remove the risks of sickness and accidents through such principle. In fact, we are the only major industrial nation in the world that does not do so.

The social security-railroad retirement system was started over 20 years ago and has done much to bring dignity to elderly Americans,