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out the thought that you have in mind. In other words, you have objected to the language used on the basis that it is too narrow. We will be pleased to have your suggestions as to what you think should be contained in those definitions to give the effect that you think they should have.

Dr. YATER. Thank you, sir.
Dr. JORDAN. Thank you.

The CHAIRMAN. And I want to add to what has already been said in appreciation of your attendance here today and also the attendance of Dr. Bailey, because you folks have come representing the clinics, or as we in political campaigns speak of it as the grassroots. We are getting firsthand information when individuals such as yourselves, representing organizations such as you do come before us and give us the benefit of your thoughts based on your experience. And, that is a thing that can be extremely helpful to this committee, or any other committee of Congress, and I want you to feel that the door is open to come back and make such suggestions as you see fit.

The committee will stand adjourned until 10 o'clock tomorrow morning.

(Thereupon, at 1:35 p. m., the committee adjourned until 10 a. m. the following morning, Thursday, April 29, 1954.)

PUBLIC HEALTH SERVICE ACT

(Mortage Loan Insurance}

THURSDAY, APRIL 29, 1954

HOUSE OF REPRESENTATIVES,
COMMITTEE ON INTERSTATE AND

FOREIGN COMMERCE,

Washington, D.C. The committee met at 10 a. m., pursuant to adjournment, in room 1334, New House Office Building, Hon. Charles A. Wolverton (chairman) presiding.

The CHAIRMAN. The committee will come to order.

STATEMENT OF HON. JACOB K. JAVITS, A REPRESENTATIVE IN

CONGRESS FROM THE STATE OF NEW YORK

The CHAIRMAN. We are pleased to have with us this morning as our first witness our distinguished colleague from New York, Mr. Jacob K. Javits.

During the time that Mr. Javits has served in the Congress he has given an abundance of evidence of his interest in those matters that pertain to the welfare of our citizenship, as well as the welfare of our country. There is nothing, however, that has occupied more of his time than the interest he has in matters of health.

It is very encouraging for us, however, who desire to promote the health problem to have the active participation of Mr. Javits and the fact that he is present today attending this hearing, and giving of his time on a very busy day for him, we feel is additional evidence of his interest in this very important subject.

We are indeed glad to have you present, Mr. Javits, and will listen with a great deal of interest to the views that you have expressed with respect to H. R. 7700.

Mr. JAVITS. Thank you very much, Mr. Chairman, for your gracious introduction. You have overstated very much, with great kindness, my own role in this matter.

The chairman of this committee has set us all an example which it will be hard to follow, in devotion to the idea of improving American health and the ability of the American people to cope with their health problems and I think that the chairman has made his place very secure in history, in the history of our country, on this major subject.

Now, Mr. Chairman, I am here to testify in support of H. R. 7700 this morning, which I think is a highly desirable and important step forward in respect to caring for the people's health.

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The CHAIRMAN. On account of the noise outside it will be necessary, Mr. Javits, to speak just as loud as it is possible for you to do so. I can scarcely hear what you have said.

Mr. JAVITs. I think I will try, Mr. Chairman. We are all so spoiled by these microphones that we forget that for many hundreds of years men did without them.

Mr. Chairman, as I stated, I am here to testify in support of H. R. 7700. I would like to say that though I am in favor of it and I should say why, I do not believe that it represents the answer to the problems of the people's health, for, with due respect to the authors of this bill, and, I believe, H. R. 8356, that is, the reinsurance bill, upon which this committee took extensive testimony, represents either the answer to the problems of the people's health.

Both measures are necessary steps toward discharging the Federal Government's obligation in that field.

I believe that even the step forward would be completely inadequate, if we concentrated on the reinsurance bill and did not include H. R. 7700, which I think is necessary to make this a step of substance. But, I think that the committee should still consider, as it is considering, the whole health picture, and I know it is, for a comprehensive national health program, and the approach that it wishes to take to that program, and having decided upon the approach, then to go forward to implement that approach.

Now, first, let me say why I am for H. R. 7700 and then I would like for a few minutes to go into the broader aspects of the problem.

I believe that the reinsurance bill helps the volunteer plans, like the Blue Cross and the Blue Shield, and helps the commercial carriers, but all this deals essentially with insurance which covers catastrophic illness, hospitalization and other illnesses, in which there is a very heavy expense suddenly. I believe that this leaves untouched an enormous field in the health field.

As I said, the reinsurance bill leaves untouched or substantially untouched, the whole problem of preventive medical care and the normal day-to-day office patient relationship with physician and patient, which accounts for probably the bulk of the expenses for medical care in our country. H. R. 7700 seeks to do something about that.

The whole answer to bringing down the cost of medical care, if it can be brought down, to such an extent as to make it readily available to all our people without distinction as to class or economic status, is in mutualizing the proposition upon an actuarial basis. Everybody is not sick all

at the same time, and yet everybody is called upon to help bear the burden of what it costs to be sick.

The same principle which attains for hospitalization attains also in preventive medical care. If you mutualize that, you will bring cost down too, and spread the risk, and the responsibility among many more people.

Therefore, if you are going to be consistent in this principle, I think that you are taking half a step with the reinsurance scheme and you have get to complete it by adding 7700, which gives us an opportunity to do something by way of a beginning on endeavoring to mutualize the cost of preventive medical care.

Now, for the best schemes which have been evolved on that score which are in effect-I think of other schemes that have been and I will tell you about one in a minute—but the best scheme on that scope which we have is the group practice, or the enormous group practice like HIP plan in New York, to which Dr. Baehr will undoubtedly speak, and who is here today.

This is an illustration of what can be done in bringing down the cost of normal medical care, preventive medicine, the office costs, the homes costs, the outpatient care, by mutualizing the risk and the cost.

Mutualization is one, a distribution of the risk in this field and second, and equally important, is the doctor and his facilities, that is, the diagnostic and treatment facilities, a base of permanent support, because he gets an established fee per year, or the group does, which they can absolutely rely on and thus enables them to discount the risks of a lot of business or a little business, or many people going to one doctor and making him very rich and too few people going to another doctor.

I think 7700 moves helpfully in that direction, because it is an established fact that in order to engage in this kind of practice, doctors who are going to club together for the purpose of performing these needed functions, in addition to that, as we all know, medicine is becoming a highly technical process with the machinery involved and I do not say that disrespectfully—but it is a layman's way of saying it-becoming more and more expensive all of the time and this bill, H. R. 7700, is a recognition of that fact.

I think actually, and this has been testified to before this committee, that these loans are very sound loans. We are dealing in a field which is very much like housing, where we started off by thinking when the Federal Government helped to get mortgage money out around the country, it would run great risks and would cost the Federal Government a great deal of money and ended up by finding out that it was one of the very profitable activities of our Government.

I think this is the same thing, and I think that the same thing will be true in respect to this trial effort which is incorporated in H. R. 7700, and naturally the promise is a very modest one, just as the proposal for reinsurance is an extremely modest one.

I have a deep conviction that far more must be done, but certainly those of us who have been working in this field for so long—and the chairman has been working in this field longer than anyone—must recognize the objections and the opposition to it.

This committee knows very well what it will face on the floor from many people when it brings up either of these bills, and I am sure it is fully prepared to meet it. I am confident that they will carry, because I think that the country is back of it.

But, no one will contend that these are very elaborate steps. They are modest, very reasonable, first steps in the direction which our Federal Government must, in my opinion, inevitably pursue and it is for those reasons, Mr. Chairman, that I support H. R. 7700.

If the Chair will indulge me for just a moment, I would like to say as to a comprehensive national-health program, this is a very major question. I believe that despite all of the tub thumping which

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