high morbidity periods which are November through March, which will involve handling a larger volume of claims than during low morbidity months, April through October. The reason we were so successful in inaugurating the medicare program among the many mistakes we made was we did not start it in November or December. We started it on July 1, just before the July 4 weekend. Physicians take vacations at that time. Hospital occupancy is at the lowest ebb. We inaugurated the medicare system under the most auspicious conditions. Morbidity rates decline very rapidly when physicians are not at work. Therefore, we were able to start the system without having to regiment anybody, and I would suggest when you start any new benefit, don't start it in December or November when all the sickness conditions exist. Start it at the time when the situation is at the lowest level so you start with the best foot forward. Benefits under any national health insurance system should be phased into operation by a predetermined schedule in the law. None of the bills that are pending do that. That is another fatal defect. In determining that schedule you should take into account the progress made under the recently enacted Federal health resources law and any Federal manpower legislation. I will present to you my idea of the sequence of events which should be put into a law for a schedule that will take into account administrative reality. The Federal administrative authority for the program should be taken away from the Department of Health, Education, and Welfare and be vested in a board of three to five persons similar to the Social Security Board, which developed the original social security program. The policies and implementation of the program should not be in the hands of a single administrator no matter how competent, no matter what his or her professional background should be. The program of health insurance involves so many sensitive, complex political, emotional, financial aspects that it should be in the hands of a board. The Federal board should be in operation a number of months before any new major benefits or policies are put into effect. A separate health appropriations bill should be processed by the Congress to insure that all health legislation is considered in relation to every aspect of health and medical care. I would not pass a national health insurance bill until Congress has remedied this defect until they have brought together all health programs in one appropriation bill. You are not going to be able to coordinate the Federal Government's responsibilities until those aspects of the Veterans' Administration, the Defense Department and other departments are brought together in one appropriation bill so Congress exercises its policymaking authority at one point in the legislative process. I can tell you this is an almost insuperable thing I am asking you to do. But if you don't put your own house in order, Mr. Chairman, you cannot then complain that nobody else in society in the health care is putting its house in order. The Health Insurance Benefits Advisory Council should make a report with any recommendations each year on the operation of the plan. I believe that the operation of the Health Insurance Benefits Advisory Council, which has been downgraded by the present admin istration, has been a great mistake. The successful implementation of the medicare program in the earlier years was done because of the close coordination we had with the Health Insurance Benefits Advisory Council. At no stage did we implement any regulation without consultation with key providers and consumers. The playing down of the Health Insurance Benefits Advisory Council in the past 8 years has been a tragic mistake and you should not implement a new health insurance problem without broadening that Council, giving it key importance and asking it to play a significant role in the implementation of policy. Mr. Chairman, if you will turn to my testimony, I would like to go over with you my conception of the problems that are involved in implementing any national health insurance law. I should like to start with table No. 1 first, Mr. Chairman, if you would like to handle that first. [The table follows:] TABLE 1.-Schedule of possible congressional consideration of comprehensive national health insurance legislation Mr. COHEN. Based upon my experience with this committee, I estimate, first, that it will take you at least 10 months from the time your subcommittee considers or reports out any health insurance legislation to Presidential enactment. I think there has been a failure on the part of many people throughout the country to recognize past experience about the period of time it takes for proper legislative consideration. I am sure many may well disagree with me, Mr. Chairman, and members of the committee, but I have outlined here a table which gives my idea of the time a major national health insurance bill would require for processing by the Congress and while you may be able to shorten it up, I don't think you will be able to shorten it much. After your subcommittee has reported it out, I have assumed the full action of the House committee would take about a couple of months and another month for the Rules Committee. Action by the House of Representatives would be somewhat in the nature of 5 to 6 months after you have reported it out, and then at least 2 to 3 months by the Senate Finance Committee, the Senate, a month or so by the conference committee, and even if you reported a bill out today by this subcommittee, it would be somewhere between 6 and 10 months before that bill would be signed by the President. Let me say this: The longer you take, the better. National health insurance is such a monumental undertaking that unless you allow a lot of time for the potential administrators, the country, the providers, and the consumers to take into account what 57-677-75-18 the new relationship is going to be, you will be making a very tragic mistake in the ultimate implementation. Let me turn now to table 2. [The table follows:] TABLE 2.-Outline of a possible step-by-step development of major provisions of national health insurance legislation with due regard to administrative feasibility Provision Number of months from enactment Congressional deliberations from time of reporting bill out by the House committee -10 1. Enactment of the national health insurance law_. 2. Selection and appointment of members of the National Health Insur- 4. Broaden membership on Health Insurance Benefits Advisory Council; consultation with it on major policy matters--- 5. Broaden medicare coverage; use of State or regional fee schedules for payments to physicians; prospective reimbursement for institutional providers; and strengthening of State agencies for a more effective role 6. Begin health education program. 7. Extension of home health services and outpatient services to entire population-- 1-3 4 5-8 67 9 8. Coverage of major maintenance-prescription drugs for medicare; reduce medicare age to 60- 9. First annual report to Congress; congressional review 17-22 10. Coverage of physicians services for entire population; no coinsurance or deductibles for maternity and children__. 11. Coverage of hospital services for entire population___ 12. Implementation of experimental arrangements for long-term care, including skilled nursing care, intermediate care, and family home care 27 13. Second annual report to Congress; congressional review_-_- 29-34 30 15. Coverage of dental care for children under age 6. 32 16. Extension of major maintenance-prescription drugs to entire population 36 40 41-46 42 48 17. Revision of long-term care programs with adoption of new approaches_ Mr. COHEN. On the date of enactment of the national health insurance law, we will call that the zero date. That is the date when the President has signed the bill. The next step is the selection and appointment of members of the National Health Insurance Board, the Senate hearings, and confirmation. I have assumed that would take 1 to 3 months-for the new members to take office and make the necessary appropriation requests, have the appropriation of congressional hearings, and on action appropriations, 4 months. I think that is overoptimistic. My experience with Congress has been it just does not act that fast on appropriations. I am not being critical. I think that is good. I think Congress should exercise its scrutiny over the appropriations but to assume on the date of the enactment of the act you can get going within 4 or 5 months is, in my opinion, extremely optimistic. My fourth step is broaden the membership on the Health Insurance Benefits Advisory Council and let them meet and constantly consult with the new Board for about 2 to 3 months before any action is taken on the implementation of any benefits in the new health insurance law. Then, Mr. Chairman and members of the committee, I would not proceed to implement the benefits all at once. That can only bring great tragedy and catastrophe to the whole health delivery system of our country. I suggest, therefore, that you take a step-by-step broadening of the program which builds upon tried and tested experience and not some preconceived notion of what is the best benefit that ought to be provided. You have to take reality into account. Human fallibility is involved in making a benefit program apply to 220 million people in 50 States and 3,000 counties and 50 wards in the city of Chicago. So, I would say, let's take a look now at how we can make this system successful, taking into account administrative reality. My first step would be, broaden the medicare coverage. This is a tried and tested system. It is working. You have administrators who are responsible for that; broaden the medicare coverage first to cover all of the scope of benefits that we have been talking about for the aged, include hearing aids, eyeglasses, examinations, any of the items that you think are meritorious that you are going to include in the general system. Broaden the medicare coverage first. Start out on something that is going to be successful. Don't start on something that is the hardest, most difficult, untried part of the program. At the same time, I would begin to use State or regional fee schedules for payment to physicians. You know if you have a general system you are going to have to change the reasonable and customary cost formula in the present law. My suggestion, which others may differ with, is to go to fee schedules, negotiated fee schedules on a State or regional basis. That is going to take you time. You are going to have to negotiate with the medical profession in 50 States or 3,000 counties. You cannot do that in a week. You can't do it in a month. It will take at least 3 to 6 months to do it. The longer you take the better, because what you want to get is agreement between the administrators and the providers on a satisfactory formula. You are going to have to do some collective bargaining, you are going to have to have some arbitrators, some negotiators. The second aspect to put into effect is prospective reimbursement for institutional providers; that is, to get to a budgetary system of handling the payments to hospitals and to nursing homes as against the reasonable cost concept which is imbedded in the present law. To make that work is going to take at least a year or a year and a half. You can't do it overnight. It is too big a job. There are some 7,000 hospitals in the United States, with boards of people in the various communities. They want to know how it is going to be applied. It will take a little time to get it into operation so it is successful. And so will the strengthening of the State agencies for a more effective role which is now being carried out under the health resources planning program. Then, Mr. Chairman, I would begin a comprehensive health education program before I did any other thing. I would enlist the total community into those kinds of problems about benefits in the health system which were overused or underutilized. Following up the statements made by the previous two witnesses I would identify in every locality those health benefits which were in short supply and over supply. I would enlist the people in the com munity into attempting to put this system into effect in a rational way without abuse or overuse but to utilize those facilities that they had and to build slowly toward changing the health delivery system which cannot be done overnight. Then, the next thing I would put into effect is the extension of home health services and outpatient services to the entire population. I would not start with either physician services or with hospital services. If you start with both of them all you do is increase the volume of such services being provided. But put into place the home health services and outpatient services to the entire population that will give you some working chance--I don't think there is much but whatever little there is you ought to take advantage of it-to see that people get their health services in their home or in outpatient care of a hospital or a clinic rather than continuing to press for institutionalized services and services in the doctors' offices. Our experience in recent years has been that there is really no limit to the volume of health services that people will want or get in a practical sense. Of course, there is, but the fact that utilization has been climbing and will continue to climb in the indefinite future should make us more careful in the way we implement new benefits. Therefore, I suggest we don't start with physicians' services, we don't start with hospital services, we don't start with nursing home services. Start with some kind of service that will help you prevent these high-cost services of the individual physician and the individual hospital. Implementing home health services and out-patient services for the entire Nation is a gigantic effort equal to General Eisenhower's landing in France on D-day, so don't minimize it as a consequential impact upon the health delivery system. I think it is extremely important and if you could make that kind of priority work it would be the most significant thing you could do about the health delivery system of the United States. Then I would struggle with that for about 3 months which is an inadequate period of time. Then I would go next into my sequence of adding maintenance prescription drugs for medicare and possibly reduce the medicare age from 65, to 62 or to 60. Now, why do I suggest beginning with maintenance prescription drugs only for medicare? That is a tremendously difficult enterprise, to pay for prescription drugs. I would not do it for the whole population at once. It is a big enough job to do it for the 25 million people who are 65 and over but to do it for all 220 million people at once involves us in so much bookkeeping with the 55,000 drugstores of the country and the 5- or 6,000 hospitals and the 300,000 physicians that my theory is that you ought to start it on a narrower basis, work out the difficulties and once you have worked out the difficulties which will take you at least 2 or 3 years, then apply it to the whole population. As you will see, I then suggest that at a later date apply it to the whole population. But for goodness sake, don't make any kind of even maintenance prescription drugs available to everybody in the population on 1 day. It would be a flop. It is predetermined to failure if you do it because of the vast difficulty. Then of course, what I would do when I reached stage 9, I would have an annual report by the National Health Insurance Board made to |