me particularly, but there are an awful lot of people who are opposed to national health insurance. ADA wants adequate health for all our citizens-if Ives-Flanders would give it then we want Ives-Flanders.

Senator PURTELL. Do you not think you hit something there when you said you, of course, believe in subsidies, but there are people who hold different views, but you said do not give subsidies until we have the facilities.

Mr. HARRIS. That is right.

Senator PURTELL. And I assume you meant also personnel.
Mr. HARRIS. That's right.

Senator PURTELL. To see these services are used.

Mr. HARRIS. Yes.

Senator PURTELL. You agree, and your testimony indicates it, that if we had all of the money we wanted, and all of the money you spoke of, for instance, $100 billion or more available, the facts of the matter are that we must have the facilities and personnel to put any plan into operation and to get greater coverage. There are different views as to how that can be done, but obviously we are all for doing that ard trying to find out how to expand those facilities.

There is a question as to the type of the facilities and a question as to the amount to be spent on certain types of facilities, as opposed to others. But if you followed this testimony at all in these hearing I am sure you will recognize that is what we are trying to do. There is a question as to how fast it can be done, and the means employed to do it.

We recognize we do not have all of the facilities we would like to have and we would like to expand them, and the personnel also.

Mr. HARRIS. I agree with that 100 percent. I think President Eisenhower in his budget speech gave a pretty good summary of what should be done in a sort of general way. However, he failed to follow up with adequate proposals. The only difference between us is it is i question of the rate at which the facilities are provided.

Senator PURTELL. And the means by which they are provided. Mr. HARRIS. That is right. And I would be inclined to go more rapidly than you are doing. I think it is really disgraceful in a coun try like this only 3 percent of the income goes to medicine. It is a bar question of spending. The question is how far the Government should go to correct it.

My point is, if we do not get a good comprehensive health-insurance program, we will get real socialized medicine, which is Government medicine.

You know, since the war that the proportion of expenditures by the Government on medicine has gone up 50 percent. I think it suggests if we had a better organization of private medicine including com prehensive health insurance, the proportion of Government spending would decline.

Senator PURTELL. Of course, some of this increase has been due to the fact that our dollar was not worth what it was in 1939.

Mr. HARRIS. But of course, we have more dollars, too, Senator. I do not think this is a relevant point. The point is our national income has gone up, let us say, since 1933, by about 6 or 7 times in dollars Your income goes up and your expenditures go up. Why is it that the proportion of medical spending has not gone up, despite the fact

that every economist says it is the kind of spending that does go up when income goes up? Why is it? Poor organization and the fact that the cost of medicine has gone up more rapidly than other costs, particularly hospitals. I think we ought to try to do something to increase the total amount spent on medicine and get better distribution of the expenditures and cut down the cost of medicine. It can be done partly by organization.

I don't think I have anything else to say, Senator. I appreciate very much your courtesy. I know I have said things that would make most Republican Senators unhappy, but I have said them many times before.

Senator PURTELL. I think we ought to make clear I don't sit up here as a Republican Senator. I sit up here as a Senator of the United States Senate from the State of Connecticut, and not as a Republican Senator. I am sure my colleagues up here do not sit up here just as Democratic Senators.

Mr. HARRIS. No, Senator, I must say I was a little annoyed today that some of my friends on your committee were not here this morning, and I am going to tell them so, too. I do not know where they are.

Senator PURTELL. They are probably at other meetings, and I know you will find that it is true that they are probably at other meetings. Off the record.

(Discussion off the record.)

Senator PURTELL. I thank you very much for being here. It is evidence of your intense interest in trying to solve the problem, and I commend you for the time and thought you are giving to it.

This hearing will stand in recess until 10 o'clock tomorrow morning. (Whereupon, at 11:45 a. m., the hearing was adjourned until 10 a. m. the following day, Friday, April 23, 1954.)

PRESIDENT'S HEALTH RECOMMENDATIONS AND

RELATED MEASURES

FRIDAY, APRIL 23, 1954

UNITED STATES SENATE,

COMMITTEE ON LABOR AND PUBLIC WELFARE,

SUBCOMMITTEE ON HEALTH,
Washington, D. C.

The subcommittee met at 10 a. m., pursuant to recess, in Room P-63 of the Capitol, Senator William A. Purtell, chairman of the subcommittee, presiding

Present: Senator Purtell (chairman of the subcommittee).

Also present: Melvin W. Sneed and William G. Reidy, professional staff members.

Senator PURTELL. The hearings will come to order.

We are very pleased to have two of our colleagues here this morning to testify. I know that both of you have urgent business elsewhere. Have you decided who should be first, and whether you will proceed on the basis of seniority, Senator Dirksen?

Senator DIRKSEN. I defer to my good friend.

Senator PURTELL. You defer to your colleague from Connecticut, So we are pleased to have you, Senator Bush.

STATEMENT OF HON. PRESCOTT BUSH, A UNITED STATES SENATOR FROM THE STATE OF CONNECTICUT

Senator BUSH. Thank you, and I thank my colleague for yielding to me. He did it on the presumption that I would not be over 3 or 4 minutes, and I think that will be the case.

Senator PURTELL. I want to say to my distinguished colleague we will be happy to have him testify for as long as he wishes. I know it will be very interesting and worthwhile.

Senator BUSH. I want to tell the Chairman I am very pleased to be here to testify in support of S. 3114 introduced by the distinguished chairman of your full committee, Senator H. Alexander Smith of New Jersey, and of which I am privileged also to be a cosponsor. This bill would encourage broader and better health insurance for more people. It offers real hope for helping American families meet the staggering costs of medical care.

The burden imposed on American families by long sieges of illness has brought demands in some quarters for a national health insurance plan operated by the Federal Government. This would be a dangerous step toward "socialized medicine." I am pleased that this administration has come forward with an alternative which demon

strates its confidence in the free-enterprise system which has accom plished so much in providing a better way of life for our citizens. Our State of Connecticut is often referred to as the insurance center of the United States, and justifiably so. You are all aware of the great progress that the insurance industry has made in provid ing health insurance to the American people. In just 15 years the number of people in America having some type of hospitalization insurance has increased from 8 million to 92 million people-over 1,100 percent.

While much has been accomplished, better health insurance is needed for more people. This bill would provide the incentive for insurance companies, nonprofit and private, to tackle new areas of coverage and broader benefits. It is, it seems to me, a golden oppor tunity for the insurance industry to fill a national need. They car do it just as they and other industries have been meeting the needs of the people throughout our history.

There are many features of this bill which should be attractive to the insurance industry. It is voluntary in every respect. No insur ance company would be compelled to reinsure a plan with the Feders! Government. The reinsurance service itself would be established or a noncompetitive basis. If a nongovernmental reinsurance service existed on comparable terms with respect to a particular plan, the Federal Government would be prohibited by law from reinsuring thy plan. The State insurance commissioners would still be the regul tory body for insurance companies; the Federal Government would not have regulatory powers over the industry.

In short, this bill to encourage better health insurance is built upo our traditional concepts of private enterprise and freedom from urnecessary Government interference. A solution to the problem of high cost of medical care is needed, and I strongly favor a course that encourages and builds upon our existing successful private insurat

system.

May I thank the chairman for his courtesy and consideration! Senator PURTELL. Thank you, Senator, for coming over here. I might say you were well within the bounds set by yourself in your discussion with Senator Dirksen. Thank you very much.

Senator BUSH. I thank you for that observation.

Senator PURTELL. Senator Dirksen, of course, we are also happy to have you here to help us in our deliberations and make your views known on this proposed legislation.

STATEMENT OF HON. EVERETT MCKINLEY DIRKSEN, A UNITED STATES SENATOR FROM ILLINOIS

Senator DIRKSEN. Mr. Chairman. I assume that there is great tru in the observation that the city of Hartford in the Nutmeg State S in truth and in fact, the insurance capital of the world.

Senator PURTELL. May I interrupt to say that we do not refer to it now as the Nutmeg State, but rather the State of Steady Habits Senator DIRKSEN. Oh, that is good. I can well understand, there fore, the abiding interest that the two distinguished Senators from Connecticut have in the insurance features of Senate bill 3114, whi is presently pending before this subcommittee.