Secretary RICHARDSON. Exactly.

Mr. DELLENBACK. Thank you very much.

Secretary RICHARDSON. Thank you, Mr. Chairman. I am sorry that

I really must go.

The CHAIRMAN. The Assistant Secretary, Mr. Cardwell, will remain, and Dr. Egeberg and Dr. Wilson.

Secretary RICHARDSON. They are both right here.

Thank you very much, Mr. Chairman.

Mr. ROGERS. I think it would be helpful if Dr. Egeberg stays.

Dr. EGEBERG. If it will help I will be glad to stay.

Mr. ROGERS. I think it would be helpful, Mr. Chairman.

Dr. EGEBERG. I will say I was one step too slow.

Mr. ROGERS. What I am concerned with is that it appears the way I read it, that the priority is to be given to dollars and not to health. I say this for this reason. As I understand the Secretary he said he has the obligation to provide health care.

For how many people are there now in the Public Health Service, over half million?

Dr. EGEBERG. About a quarter of a million.

Mr. ROGERS. I understand you are giving health care to over a half million. Is that not about right? 535,000?

Dr. WILSON. 251,300 is the estimated eligible beneficiary population. Mr. CARDWELL. We ought to qualify that. 535,000 is the total number of individuals treated by the Service. On an average day we serve 1,700 people.

Mr. ROGERS. I will go into this later. My figure is over a half million. Let me ask this. What happens if you turn this over to the VA and you have a service-connected veteran and you have a merchant marine and there is one bed available?

Who gets the bed?

Dr. EGEBERG. If you are asking me, sir, our responsibility is very clearly to the merchant marine.

We do not abrogate that responsibility if there were not a bed available in the Veterans' Administration facility we would find another

one.

There would be a man there to see that there was another bed found through other contractual arrangements in the private sector.

Mr. ROGERS. If there is a bed available and there is another hospital around. Now suppose there is no other hospital and you only have the veterans hospital there, what do you do?

Dr. EGEBERG. I don't know of any such situation. These hospitals are all in cities where there are many other hospitals.

Mr. ROGERS. Will the gentleman yield for a second? He will not only come after the service connected but he is behind the nonservice connected according to the Comptroller General who found that the Public Health beneficiary would not have priority over non-service-connected veterans. So he is third on the list.

Mr. CARDWELL. If you examine the Comptroller General's decision I think that was the essence of his decision. In other words, no one in the executive branch had any authority to abrogate the basic rights of a veteran in a VA hospital.

That is one reason they concluded that the 1965 proposal was prob

ably an invalid one. That proposal was dependent largely on the concept that VA would assume a primary responsibility and we're not longer considering that concept.

Mr. ROGERS. So you know they cannot assume a primary responsibility, don't you?

Dr. EGEBERG. They have reduced their patient potential which means they have closed off areas probably by about 5,000 patients a year in the Veterans' Administration system over the past 5 years.

So there is the potential there for them to make arrangements and we would furnish extra personnel or whatever was necessary in paying for them to make the extra arrangements to be ready to take care of the merchant seaman.

Mr. ROGERS. Any time any veteran, service connected or nonservice, is on a waiting list you can't put a merchant seaman in that hospital. You agree to that now. I understand your comptroller says that is true.

Dr. EGEBERG. I am not sure about the nonservice connected because that case but it may be that he is covered, too.

Mr. ROGERS. He just said this.

Mr. CARDWELL. I said this is what the Comptroller General seems to have concluded.

Mr. ROGERS. There is no question about that.

Mr. CARDWELL. I think you are probably right, I think, Mr. Rogers, if you permit me, that your particular example really is looking under the bed quite far.

If you look at today's circumstances and you look at them broadly across the board that is not likely to happen. It is just not likely to happen. We would hope that we would start with that premise, that we have to start with a horrible example and test whether or not there is some basis for the considerations that are now underway.

Mr. ROGERS. This is nice to talk about here in the committee and in the department but to the sick seaman it is not very helpful if he is caught in such a situation and can't get in the hospital.

Mr. CARDWELL. I agree. We have a responsibility to see that he is not caught in such a bind and we think we can carry out that responsibility.

Mr. ROGERS. That is right. First of all we know this is so. He can't get in if there is any veteran on a waiting list. Second, I say it is going to cut costs. Now if you contract out services to local hospitalsdid you see what announcement there was yesterday in the paper here? Mr. CARDWELL. Concerning local hospital costs?

Mr. ROGERS. Local hospitals have just added $8 to $10. That is right here in Washington. Now you have your hospital costs about a hundred dollars a day. In fact right in Baltimore I think your public health hospital there has an average cost of $79 but that includes the cost of the physician.

Now you can't get anywhere near that in a private hospital, particularly if you add the cost of the physician, himself.

Dr. EGEBERG. The experience in the hospitals that have been closed so far would indicate that less than one-third of the patients have to be taken care of in private hospitals. The rest have been absorbed in the veterans' hospital without jeopardising their care.

Mr. CARDWELL. Mr. Rogers' point is well taken. It is one that we will look at very carefully. Any assumption that there would be a net savings in costs has to depend on VA absorption of a large share of the patient load. There is no question about that.

Mr. ROGERS. Of course there is no point in even talking about it. Since he has no priority to get into the veterans hospital, and you can't change that, you have admitted

Mr. CARDWELL. The issue is, can he get in without priority? The evidence sems to be, and this is what we are going to test very shortly, that he will be able to gain admission.

Mr. ROGERS. I would like concrete evidence submitted for the record on that. This is the basis of your whole decision I am sure.

Mr. CARDWELL. Largely; yes. We think that a significant change has occurred since 1965.

Mr. ROGERS. And have you done a study on the quality of care in the hospitals, have you, VA hospitals? Have you just seen a documentary not long ago that said the care is substandard in VA hospitals?

Mr. CARDWELL. There was a television program, I believe.

Mr. ROGERS. There certainly was. Here you are ready to turn over the whole merchant marine health program where you say it will go to VA where we have already had the documented proof that it is substandard care.

Mr. MURPHY. On a Saturday afternoon about 3 weeks ago I received a call in my congressional office from the sister of an American veteran who was dying of an acute kidney failure. He was in the VA hospital at Fort Hamilton in Brooklyn. He was going to die there because they had no renal clinic, no ability to treat him.

We had to send a private ambulance to the Veterans' Administration hospital-this man's name is Franco-and take him to the Public Health Service hospital.

The man was in such poor shape the skin was rotting off him. Here is an American veteran in the VA system. Fort Hamilton is a modern 400-bed hospital. It did not have the ability to give that veteran quality care.

At 23d Street in Manhattan in an older building there was a renal clinic but it was full. Kingsbury in the Bronx, a hospital older than the Public Health Service hospital, took this man and saved his life and he goes 3 days every week in order to maintain his existence.

But that veteran would be dead under those circumstances. I can cite chapter and verse. Another veteran named Kelly also went in there. Then I will tell you another case of a veteran not in a Federal hospital that walked in a Public Health Service hospital with a wire hanging out of a vein connected to his heart where they disconnected him from the pacemaker.

If it were not for the Public Health Service hospital that could give quality care there is another veteran that would not be with us today. You want to contract with VA at $40 a day because that figure looks good.

I want to submit for the record here a VA statement as to their $51.90 per diem cost in a general hospital as well as the $28.05 per diem cost in the psychiatric hospital which gives you your $40 figure but in any negotiations with the VA and the Public Health Service

the Public Health Service found out how difficult it was to deal with the VA on any type of money transaction because the Public Health Service hospital in Clifton sets aside 35 beds for veterans to do the job that the VA hospital can't do.

These are some of the frills that we are talking about that you would forego should you enter into some type of contractual agreement if legally you could take care of a seaman in that VA hospital. This document previously submitted shows 3.242 on the waiting list relative to the VA treatment. If you can find any extra beds in the city of New York, if you can find any extra beds in the community where this Public Health Service hospital is located, we in that community would love to know where they are.

I would like also to point out that that bed in that community at Glenpoint Hospital and Lincoln Hospital is $97.90 a bed. That will be the contract price as the Secretary said for non-Federal contractors sources other than the VA hospital care.

Mr. ROGERS. I just have a couple more questions, Mr. Chairman. What are you going to do with your professional staff now employed by these hospitals and clinics? What are you going to do with them? Mr. CARDWELL. Could we come back to Mr. Murphy before we finish the exchange because I think some of his points deserve comment?

Dr. WILSON. Roughly 20 to 25 percent of our commissioned corps is in the Public Health Service hospitals. It is our assumption that, hopefully, with the aid of the bill you sponsored or a comparable authority, these professionals can be used in the disadvantaged urban areas, ghetto areas, or in migrant health programs. Insofar as the balance of the professional people in the hospitals are concerned, there is a substantial shortage across the Nation of these kinds of people. They are in short supply in the VA hospitals, for example.

We would put every effort into making sure that these individuals are incorporated, in a meaningful way, into health care activities if we come to the conclusion that a Public Health Service hospital should be closed.

Mr. ROGERS. This is shocking to me that this has gotten as far as it has in the thinking of HEW when we are trying to build up the public health corps and the Congress has then just taken positive action, that you are now talking about dissipating the resources.

Now actually isn't this a Bureau of the Budget management decision? Isn't this what is pushing you into this?

So.

Mr. CARDWELL. I don't think it would really be fair for you to say

Mr. ROGERS. It may not be fair, but isn't it the truth?

Mr. CARDWELL. It would not be true, I will say it very bluntly. Could

we describe the process and maybe we can amplify that?

Mr. ROGERS. As a matter of fact you had some discussion but didn't

the Bureau of the Budget say you close them all?

You did not recommend all of them be closed, did you?

Mr. CARDWELL. No, sir. Our initial consideration

Mr. ROGERS. Didn't they come back and say you close them all?

Mr. CARDWELL. No, sir.

Mr. ROGERS. Haven't they recommended all eight?

Mr. CARDWELL. I can't answer that question. This issue is still under consideration.

Mr. ROGERS. I know. I am saying didn't the Bureau

Mr. CARDWELL. One recommendation was to close five of the eight. Mr. ROGERS. That is right, and leave three of them open?

Mr. CARDWELL. Yes.

Mr. ROGERS. The Bureau of Management came back and said close them all, you might as well close all at one time.

Mr. CARDWELL. I cannot agree.

Mr. ROGERS. They did not recommend closing them all?

Mr. CARDWELL. They raised the question should you not close them all. If you are going to close five why not close them all? But to say they came back and said close them all would not be correct.

Mr. ROGERS. Well, they were going through the process of allowing comment but they recommended closing all of them. That is their attitude. Wouldn't you say that is true?

Mr. CARDWELL. That particular decision has not been made. The Secretary has made quite clear his desires and intent to join the issue. I think that it will be decided finally at the highest levels of the Government. That will include the Director of the Office of Management and Budget and perhaps even the President, himself.

Mr. ROGERS. I hope the President will get into this and I hope he will change the priority of dollars for the priority of health care to those we are obligated to give it to. From all that I have seen in the health legislation we have handled this year there has been a negative attitude from the Department of HEW on health matters and a downgrading of health in this Nation, even in spite of the fact that the President has called this a state of crisis.

Thank you.

Mr. CARDWELL. Mr. Chairman, I was going to ask if we could comment on Mr. Murphy's points about the veteran who had a very severe kidney failure and needed care and could not obtain it except in the Public Health Service hospital.

My colleagues would probably be better qualified to comment on this than I but let me take a shot at it. It seems to me that you have touched on something that is not peculiar to veterans or seamen.

The problem of kidney dialysis and renal care on a sophisticated basis is a universal one in this country. There are literally tens of thousands of people each year who find themselves in a position of the person you described. The one you describe may be a case history that involves, in this instance, a veteran in a Public Health Service hospital but there are similar cases involving private citizens all over the country every year. It is a tough, tough problem. It is one that we do have to concern ourselves with and it is one that we will concern ourselves with.

On the point of the urban problem of inadequate facilities for care generally, this is a point we must also consider. It is also a point that we must feel responsible for and we are not going to blindly close out facilities and deny beds to the community. This is not something that we would advocate. It is something that I hope we will not do. We are concerned and have a responsibility for all of the things that you identify, each and every one of them.

We must be very careful not to head ourselves off in the wrong direction. I feel that Secretary Richardson will be that careful. We