Wherein we ask does this voluntary group differ from the ignored proprietary group, ignored in spite of the fact that they carry out and prove the basic fundamental tenet in this country, namely, free enterprise and private initiative. This principle is expanded on page 2, line 10 of the bill, and I quote:

Solutions to the people's health needs can and should be attained through free enterprise and private initiative.

Let us at no time lose sight of this all-important fundamental of our political and economic life.

Just as do the voluntary institutions, we, the proprietary nursing homes in this country admit people who are able to pay their way, people who can only partially pay their way, and people for whom private and governmental agencies have assumed responsibility.

The unhappy difference is that we have no tax exemptions, no right of fund solicitation, and no recourse to tax funds in charitable institution budgets. Ours, therefore, is a very, very difficult role. We are a recognized member of the medical care team in the total overall medical care program, locally, statewide and nationally, yet for some reason, which we choose to believe is purely oversight, no mention is made in this bill H. R. 7700 of the proprietary nursing home.

We hope that you will bear with us if we recall to this committee's mind testimony on bill H. R. 7341. In the testimony to which we refer the question was asked by one of the committee whether the nursing homes fear competition, or whether they fear the higher standards which would be set by the allocation of money to voluntary institutions only.

We wish to call to your attention the fact that nursing home operation is a profession and not a business. We wish further to call to your attention that it is not competition we object to, but unfair competition.

Our position on the medical care team has a parallel. This parallel is that we, in a sense, are much like the physician who practices his profession without fear that any other physician's standards are any higher, but who objects strenuously to unethical competition on the part of his fellow physicians.

We ask no special favors, but neither do we expect that assistance generously given to others will be dispensed so as to miss our capable and experienced hands.

When, therefore, bill H. R. 7700 provides for mortgage insurance on loans which may be made by private banks for the purpose of improving the medical care in any community, who can say that any recognized member of the medical care team should not benefit from such legislation?

The nursing homes, because of their pioneering status, have had to take a tremendous amount of criticism. They have taken it, and they have steadily progressed. As you probably know, there was a time when public agencies came to our then infant association for advice. and guidance in the preparation of standards for nursing homes.

Have all of us forgotten the horrors of the old almshouse? Even the very earliest of proprietary nursing homes represented an unquestioned improvement over the poorhouse.

We merely ask now that through the inclusion of proprietary nursing homes in the benefits provided in bill H. R. 7700 you make it possible for us to improve further the facilities which we originated and

initiated in this country. That, we sincerely believe, is not asking too much.

In its declaration of policy this bill states:

It is the conviction of the Congress that there is a serious need throughout the country for a greater number of hospitals and related medical relief and services than now exist or are being planned under existing programs.

Whether we find ourselves in total or partial agreement on this point we do want to point out that such need may well be local in nature and that it is a fact that some parts of the country are quite well provided for through existing proprietary nursing home facilities. No one will deny that in some areas there are insufficient beds, and other areas there are vacancies. But it distinctly understood, however, that it can be readily proven that in those areas where the shortage does not exist that the explanation can be found in the fact that the proprietary nursing homes have provided the facilities.

Our cooperation we now offer in an extended form. Just as we have cooperated with governmental, hospital, and welfare agencies, so now are we prepared to cooperate with any medical group plan which may choose to make use of our facilities. The public stands in constantly increasing need of nursing care. If this need is to be met it is obvious that proprietary nursing homes, the organization best suited to provide this care, should most certainly be included in the planning.

There is one more item which was not at all brought out in previous testimony on bill H. R. 7341 which bears directly on our contention that the proprietary nursing home has a legitimate, esteemed place in the medical care team in this country.

Psychologists, social workers, and people in general who are interested in the humane aspects of patient care-and on this point we are certain we will have the backing of Secretary Oveta Culp Hobbywill agree that the primary concern in any medical care program is the patient. Having agreed on that can anyone with proper conscience maintain that institutional atmosphere is preferable to the type of homelike, friendly, loving-care atmosphere which is provided. in the proprietary type of nursing homes?

Many of these patients come from institutions where they have spent months and years. They come into surroundings which are maintained to provide them once again with a feeling of home and friends and not wards and crisp, impersonal uniforms.

Proprietary nursing homes offer many advantages over institutionalized, large, cold buildings. Nursing homes are located near the patient's relatives and friends. The patients are given new family within the home and, above all, they are given an opportunity to retain the small vestige of pride and self-respect which is left to them in their remaining years.

Is there really a need for the creation of new institutions when the simple expedient of a mortgage insurance plan can make it possible for those who have the best know-how to do the job expeditiously, efficiently, and economically?

One final point that we want to make in addition to what we have already said. We wish to quote from the testimony of the hearing before your committee on H. R. 7341, held on February 4 and 5, 1954, where, on page 108, your honorable chairman, Charles A. Wolverton, stated:

Certainly, there is no intention to preclude your organization and the homes that it represents from having the help that is contemplated under H. R. 7700, and if it has not been drawn specifically enough to make it certain that you would have that, I would, as the introducer of that bill, have no objection to amending it in that particular, although at this moment I do not think it will need that amendment. I wish to assure you that the intention is to assist in the operations such as you are representing here this morning.

Mr. Clerk, will you give several copies of H. R. 7700 to Mr. Muse and, too, the statement in connection with it that I issued, so that he may be assured of what I am saying.

We feel certain that the chairman, Mr. Wolverton, meant what he said, and it is on that score that we request that this patent omission in the bill as it is presently written be corrected. We, therefore, ask your honorable body to make the necessary insertions, changes, and clarifications so as to include the proprietary nursing homes in the provisions of H. R. 7700. We note that such insertions, changes, and clarifications would be in order in the following sections:

(a) Declaration of policy and purposes, section 701. (b) Definitions, section 702.

(c) Eligibility for medical facility service, section 706.

(d) And in any other portions of the bill necessary to effectuate the changes requested.

We are most grateful for the courtesy you have extended and for the opportunity you have given us to express our thoughts on this particular legislation. We are encouraged by the knowledge that legislation regarding this very important segment of the medical field is being given such thorough and intelligent consideration.

The CHAIRMAN. Are there any questions, gentlemen?

Mr. HESELTON. Mr. Chairman.

The CHAIRMAN. Mr. Heselton.

Mr. HESELTON. Do the nursing homes now, generally speaking, have difficulty obtaining financing?

Miss SIEGAL. I beg your pardon.

Mr. HESELTON. Do they have difficulty obtaining financing now? Miss SIEGAL. Yes.

Mr.HESELTON. What is the reason for that?

Mr. RICKLER. May I answer that?

Mr. HESELTON. Would you identify yourself for the record?

Mr. RICKLER. May I identify myself for the record as being Arnold H. Rickler, and I am legal counsel for the National Nursing Home Association.

The CHAIRMAN. Where is your office?

Mr. RICKLER. Buffalo, N. Y., sir.

The CHAIRMAN. Buffalo, N. Y.?

Mr. RICKLER. Yes, sir.

The reason we have difficulty is because it is a one-purpose institution. You have probably had experiences in your own communities where hospitals have had the same experience. Lending institutions do not loan money generally; it is rather, may I say, the rare exception that they will loan the money rather than the general situation.

Mr. HESELTON. Is there a current need, so far as the nursing homes are concerned, for additional financing for expansion or any other purpose?

Mr. RICKLER. Yes; there is, to this extent: We have gone into the history of nursing homes. It is now coming to the age, it is our opin

ion, where it is and should be a modern hospital facility such as we want to operate. As you know, in most cases there were the old homes in the neighborhoods that were originally started. Now these various bills are before your body. In some States, may I say, the voluntary groups do take us in. In some States, Blue Shield does not. We feel that we want to qualify. We have been listening to the bills that have been before your body, and we realize and recognize the trend that is coming. We feel that we want to be able to improve our facilities to be included in health payment plans which we certainly cannot otherwise.

I am not here to make a statement; I would rather answer questions. But we feel that we can do the job. We have the personnel; we know the field; we know the pulse; we know the type of homes we operate. We, through our own efforts and I speak particularly, of course, of my own State, New York State-have made every effort to raise the standards and encouraging legislation for safety protection and fire protection and boards of supervision, and welfare agencies on our own accord to help the standing of the profession, and I say that has gone on throughout the country since the organization of our national organization.

Mr. Heselton, I think in your State of Massachusetts, what we have tried to do there is the same thing.

Mr. HESELTON. Since you have referred to licensing, and because, in Miss Siegal's statement, she stated that the association consists of membership in 33 States, I take it that there is quite a variation in State regulation.

Mr. RICKLER. That is correct. There is a multitude of State regulations from one extreme to the other. And, of course, since it comes on the State level in most cases, we have our problems in the States.

And I might state to this body that we are actively, in each State, trying to get legislation. In your State, Mr. Chairman, New Jersey, they have a regulation for licensing and have had for a number of years. They have a supervising board. And may I say we have tried to adopt and follow the New Jersey State legislation in some measures, the same as in your State, Mr. Heselton, of Massachusetts, where the board was only created within the past few years, as I understand.

I have been associated more or less with nursing problems for the past 10 years. It is only in the last year or two that I have gotten out on the national level, and nationally we are trying to raise our standards.

Mr. HESELTON. What you have said today concerns the vital importance of nursing homes in the overall medical and health approach. I think you have made an interesting contribution today to the hearing, and I am sure that all of us agree with the chairman that your suggestions will receive very serious consideration.

Mr. RICKLER. Thank you.

Miss SIEGAL. Thank you.

The CHAIRMAN. Are there any further questions, gentlemen?
Mr. Rogers.

Mr. ROGERS. I want to compliment Miss Siegal on this very fine statement, and I think that if this legislation is passed that we should include proprietary nursing homes. I hope that it will get in there before it gets out of this committee, if we report the bill.

Miss SIEGAL. Thank you.

Mr. HESELTON. You can strike out the latter part.

The CHAIRMAN. Are there any further questions?
Mr. PELLY. Mr. Chairman ?

The CHAIRMAN. Mr. Pelly.

Mr. PELLY. Miss Siegal, I would like to ask you if you do not think that if you could get long-term mortgage loans you could reduce actually the cost to your patients?

Miss SIEGAL. The cost of operation, yes.
Mr. RICKLER. Yes. May I answer that?
Miss SIEGAL. Please do.

Mr. RICKLER. If I may be permitted to answer.

Yes, of course, because there would be a more efficient operation with much the same personnel, much the same directorship. Most of these places can be a 50-bed institution rather than the present size, 25 bed, which, of course, would bring down the cost tremendously.

Mr. PELLY. I would like to ask you if this provision went into the bill to include proprietary nursing homes would it not be possible to construct facilities in localities where now there is no possibility of finding an old home, in some of the newer subdivisions and communities of that type?

Mr. RICKLER. May I say that is the very thing we would like to encourage. As you know, we did not oppose the other bill. We feel that before public grants are made we can show that we can build private nursing homes in communities where none exist through private enterprise, and effect a having to the Government and to the State. We certainly feel we can do the job.

Mr. PELLY. I might say that since the hearing on H. R. 7341 I felt there was an implied promise that we would certainly give it consideration, and I am hopeful that it would be included. I studied the figures in our own State of Washington, and I was informed by the Department of Health, Education and Welfare that our State was doing a pretty good job. But in some localities we did not have adequate facilities, but in others we were up to what they considered the proper percentage of beds in proportion to population.

I think that this inclusion would certainly go a long way toward relieving the congestion on our actual hospital beds, so that people could be taken care of at a lower cost.

Mr. RICKLER. Much lower.

Mr. PELLY. It would help the States a great deal bacuse in many cases, of course, they cover the cost of the medically indigent.

Mr. RICKLER. It is up to $14 to $15 to $17 a day, and it could be brought down in many cases where they are not in need of active care in a hospital. They could be brought into nursing homes at a much lower cost to the community and the public and to the patients themselves.

Mr. PELLY. I thank you for your testimony.
The CHAIRMAN. Are there any further questions?

Mr. YOUNGER. Just one.

The CHAIRMAN. Mr. Younger.

Mr. YOUNGER. What is your average cost per day?

Mr. RICKLER. That varies in each community.

Mr. YOUNGER. What is your average over the country?