STATEMENT OF HARRY J. BECKER, PRESIDENT, GROUP HEALTH ASSOCIATION, WASHINGTON, D. C. Mr. BECKER. My name is Harry J. Becker. I am president of the Group Health Association. The CHAIRMAN. Is that a local organization or a national organization? Mr. BECKER. Group Health is a local District of Columbia organization. Its address is 1328 I Street. It is a consumer-sponsored, prepaid medical service plan. The CHAIRMAN. Do you represent any other organization? Mr. BECKER. I do not. The CHAIRMAN. All right. You may proceed. You have a prepared statement, I see. Mr. BECKER. Yes. I have been asked by the Cooperative League of the United States to testify on behalf of Group Health Association and a number of other consumer-sponsored medical-care organizations. I desire to thank this committee and the Cooperative League for the privilege of testifying on the two health bills, S. 1606 and S. 2143, now before this committee. This morning I speak as president of Group Health Association and on behalf of Benjamine Rozenzweig, secretary for the board of directors of the Greenbelt Health Association, Greenbelt, Md.; Walton County Agricultural Health Association, Inc., Monroe, Ga.; Dr. M. Shadid, Community Hospital, Elk City, Okla.; Robert Y. Wright, Jr., manager, Newton County Rural Health Services Association, Inc., Decatur, Miss.; Dr. Elmer Richman, medical director, Labor Health Institute, Inc., St. Louis, Mo.; L. R. Barry, Wheeler County Rural Health Service, Wheeler, Tex. and Dave Parmer, president of the Complete Service Bureau, San Diego, Calif. LETTERS AND TELEGRAMS ON S. 1606 I would like to leave with the secretary of the committee copies of the telegrams and letters received from the administrative officers of the plans I have just listed. The CHAIRMAN. They may be filed with the secretary. Mr. BECKER. I would like to make those a matter of record, Senator Murray. The CHAIRMAN. All right. They will be printed in the record in connection with your testi mony. (The documents referred to are as follows:) Mr. MELVIN DOLLAR, WHEELER COUNTY RURAL HEALTH SERVICE, Executive Director, Group Health Association. DEAR MR. DOLLAR: Have read tentative statement of G. H. A. giving attitude toward Wagner-Murray-Dingell health bill. Points raised in this statement indicate close study, and a complete understanding is evident. Local organizations throughout the Nation are groping around trying to find common ground between all health servicing agencies and the people. The fact that in all sections of the Nation some kind of consumer-sponsored medical care program has been or is being tried is evidence that the people believe something must be done. Local organizations will never be able to go beyond the available professional services located within the community served. The re strictions encountered by all local organizations is reason enough for national health insurance. Prepayment of health insurance should be compulsory. Fees for payment should be based on ability to pay. Health insurance should be national in scope. Services available to the people should be preventative as well as therapeutic. We believe the Wagner-Murray-Dingell health bill is the answer. We believe our health program here will tie in with national health insurance. If not we will remodel our plans. Sincerely yours, L. R. BARRY, Treasurer-Manager. GROUP HEALTH ASSOCIATION, INC., GREENBELT HEALTH ASSOCIATION, Washington 5, D. C. (Attention Mr. Melvin Dollar, executive secretary.) GENTLEMEN: The board of directors has asked me to inform you that this organization is fully in accord with your stand in the matter of the national health bill (Wagner-Murray-Dingell bill). We subscribe to the sentiments expressed in the statement of attitude enclosed in your letter of April 22, 1946. You may, if you so desire, indicate in your testimony before the Senate committee, that you are speaking for the 1,100 members of this organization. This matter has received our serious consideration for sometime past. It is to be the subject of an informative discussion meeting at which competent authority on the details of the bill are expected to speak. The attitude of this group to the whole bill will be expressed to you after this meeting, which is projected for an early date. Yours truly, BENJAMIN ROSENZWIG, Secretary of the Board of Directors of the Greenbelt Health Association. [Telegram] DECATUR, MISS., May 1, 1946. MELVIN DOLLAR, Executive Director, Group Health Association, Inc., Washington, D. C.: I heartily endorse the GHA in its stand on the Wagner-Murray-Dingell bill. I consider it to be the answer to problem of satisfactorily providing universal medical care. NEWTON COUNTY RURAL HEALTH SERVICES ASSOCIATION, INC., MELVIN DOLLAR, [Telegram] ELK CITY, OKLA., April 28, 1946. Group Health Association, Washington, D. C.: I strongly approve of your statement and the Wagner-Murray-Dingell bill. I disapprove of the fee system of paying the doctors. Letter follows. MELVIN DOLLAR, [Telegram] Dr. M. SHADID. MONROE, GA., April 27, 1946. Executive Director, Group Health Association, Inc., Washington, D. C.: We are in accord with principles expressed in memorandum on health bill. There is great need for program. WALTON COUNTY AGRICULTURAL HEALTH ASSOCIATION, INC. [Telegram] MELVIN DOLLAR, SAN DIEGO, CALIF., April 27, 1946. Executive Director, Group Health Association, Washington, D. C.: Heartily concur in your tentative statement of attitude toward the WagnerMurray-Dingell bill. Would like to be associated with Group Health Association in this stand. Letter follows. Mr. MELVIN DOLLAR, COMPLETE SERVICE BUREAU, LABOR HEALTH INSTITUTE, INC., Executive Director, Group Health Association, (Attention Mr. Albert Hamilton.) DEAR MR. DOLLAR: Some time ago you wrote asking us for endorsement of GHA's stand on the Wagner bill. At the time, our director, Dr. Elmer Richman, telegraphed you our support of your excellent statement. The request was made for a fuller statement on our part, but Dr. Richman has been so busy that he has been unable to write one. I thought you might be interested in our stand as Dr. Richman expressed in several recent speeches, copies of which I am enclosing. Pertinent paragraphs have been marked. Sincerely yours, DORIS PREISLER, Manager. Mr. BECKER. My comments today are directed to the interests of organized medical consumers in S. 1606 and S. 2143 and the place of voluntary medical-care agencies in a national health program. I shall endeavor as accurately as possible to report the thinking and the experience of the consumer-sponsored prepaid health and medical care plans. I must make clear, however, that the comments I have to make on S. 2143 are mine alone, for we did not have sufficient time to clear them with the plans who desired to be associated with us in support of S. 1606. UNIVERSAL AGREEMENT ON NEED FOR BETTER HEALTH CARE At this stage in the debate over a national health program there is no real disagreement on the Nation's health needs. Representatives of the medical profession, Federal and other Government officials, and those who have special knowledge in the field of medical economics have gathered a tremendous body of facts to document the unmet medical needs of the American people. There is today almost unanimous agreement that the Nation needs a program that will assure comprehensive medical care of high quality to all individuals with medical need without regard to economic status, color, place of residence, or occupation. Even those who oppose the enactment of S. 1606 will not challenge the statement that the people of this country desire that the instrument of their Government continue to be used to extend and strengthen medical care services for all people. The question now before this committee and Congress is not the need for positive Government action; the question that must be decided is the extent and character of Government responsibility and the method of administration. There are three aspects of this question which I desire to take up in detail. 1. Can voluntary plans meet the Nation's health needs? And, as a part of this question, what has been the experience of voluntary plans in meeting health needs? 2. Relationship of voluntary plans to a national health program. 3. What shall be the principles governing the administrative and financial relationship of the Government program to voluntary plans in the emerging national health program? TWO TYPES OF VOLUNTARY PLANS The term "voluntary agency" or "voluntary plan" has been used by witnesses before this committee to include all types of nonprofit and commercial plans based on the application of the insurance principle. Unless the type of voluntary plan is specified any such discussion is confusing. There are two basic types of voluntary prepaid medical and hospital plans in this country: 1. There are those that assume responsibility for providing or rendering a medical or hospital service through a staff supervised and paid by the organization or through facilities meeting conditions and standards specified by the agency. 2. The other type of voluntary agency or prepayment plans are those organizations that do not assume responsibility for the provision of medical or hospital service. This type of plan, unlike the first, does not assure care. This type of plan collects funds on a periodic payment basis and disburses these funds for financial obligations incurred or claims made by individual members or policyholders; this type of plan provides a financial or business service. Most of the medical society sponsored prepayment plans and the commercial insurance company health and hospital policies are in this category; most of them provide cash payment, or cash benefits for selected types of illness and for limited periods of hospitalization-they do not assure the person covered the care he may need. Consumer-sponsored plans such as those that I represent today were organized out of the belief that the right to health is a basic human right just as much as is the right to food and shelter and clothing. We have demonstrated that it is possible for a small portion of the population to assure themselves this right by prepaying the costs of comprehensive care, that preventive medicine and necessary medical treatment can be provided when economic and organizational barriers to medical service have been removed. But we can say on the basis of our own experience-not theorythat voluntary plans, at best, can extend the principle of periodic prepayment of medical care to only a limited number of people. Through the development of the principle of periodic payment the small section of our population covered by consumer-sponsored plans has been able to substantially remove the economic barrier to medical care. Some spokesmen for voluntary plans are not willing to face this fact or admit publicly that experience already has shown that voluntary plans cannot satisfactorily assure needed medical and hospital care to all or even a major portion of the population. The voluntary plans under whatever type of sponsorship and no matter how they are organized or where they operate have demonstrated the following weaknesses when they are evaluated as a method for assuring care at a bearable cost for the entire people: VOLUNTARY PLANS CANNOT COVER LOW-INCOME GROUPS First weakness: The lower income families, representing the greater part of our adults and children, cannot meet the cost of the monthly prepayment dues. Those who belong to health insurance plans are predominantly from the middle income and upper income part of the population. The lower the income group, the smaller proportion of that group that participates in a prepaid health plan and those in the lower income groups being rarely participants. Group Health Association, for example, is the only consumer prepaid plan in the Washington, D. C., area. We know for a variety of economic reasons that we cannot meet the medical care needs of the million persons living in this area. The same reasons why Group Health Association cannot expect to serve all the persons in the Washington. area will govern inability of any other voluntary plan to meet the health needs of all the persons in the Washington community. The reason why this is true is easily understood when the economic facts are known. If we assume that the families with income below $3,000 per year cannot spend more than 5 percent of total income for health and medical-care services; if we assume that approximately half or more than half of the families in the District of Columbia area have an income of $3,000 or less per year, then we know that at least half the people in the area that we serve cannot afford membership in a plan providing anything like comprehensive service. Membership in plans offering less than comprehensive service is not purchasable for most of these people. To the extent that employer contributions are practicable a larger percent of the population would be potential members. To illustrate this point further, Group Health Association dues are $2.50 per month for each adult and $1.75 per month for each child or $10.25 per month for a family of five. Our coverage is far more comprehensive than most plans. However, there are certain restrictions on admission of individual Federal employees, imposed for health conditions pre-existing admission and other less significant limitations. A family of five would have to have an income of about $3,000 per year to pay dues in Group Health Association if total family expenditures for health and medical-care services are not to exceed 5 percent of their income. LIMITED BENEFITS OF VOLUNTARY PLANS The second weakness. The medical-service coverage in all voluntary prepayment plans tends to be limited to catastrophic illness protection; few plans approach comprehensive coverage. If all the persons in the community were participating in the plan, and payments were scaled in relation to ability to pay, coverage could be complete; however, if this were true, the plan would no longer be voluntary. HIGH TURN-OVER IN VOLUNTARY PLAN Third. Costs of enrollment and turn-over of membership; that is, in a voluntary plan, must be paid by all the members. It is not uncommon to find an annual turn-over in membership of 25 percent. This means a substantial proportion of the voluntary prepayment funds must be used for administrative and promotional expense. |