paying as he goes, that this would be a method by which this matter could be met and he would not be put in the position of being on a dole. Mr. CURTIS. That is the point I am making. Through the private insurance programs that are now available, and this is a very recent thing by recent I mean it really started about 20 years ago and has just been growing by leaps and bounds-we are getting into that position where we will not have people reaching the age 65 without health insurance and in many instances prepaid health insurance.

Our older people, older than 65 who did not have this insurance available during their working years, is a group that I think we have to consider, and that is what the Kerr-Mills bill was directed to calling attention to.

The CHAIRMAN. Any further questions of the Governor?

Mr. Green?

Mr. GREEN. Governor, I know that you are familiar with the original passage of the social security bill. It included people who made no contribution.

Governor LAWRENCE. This is right.

Mr. GREEN. Every amendment that has been passed by the Congress since the original passage included people who made no contribution. I wonder if we would be here today discussing this bill if the private insurance companies had presented something that would be something that the older people could participate in financially. Governor LAWRENCE. I am sure we would not. It is just like in many other fields.

Mr. GREEN. That is all, Mr. Chairman.

The CHAIRMAN. Any further questions? Mr. Alger?

Mr. ALGER. Governor, I will not take the time to question you since I was not here for your statement. I have read it and I just want to mention two things.

Do I understand in the final paragraph that you do not believe there should be any age limit at all?

Governor LAWRENCE. NO.

Mr. ALGER. That is what you say in the final paragraph. I want to be sure I understand you. That is what you say.

Governor LAWRENCE. You mean this: "More than that I ask?"
Mr. ALGER. Yes, your final paragraph.

Governor LAWRENCE (reading):

I ask that you give this consideration, for the sake of all our citizens, no matter what their age-for it is their future as much as yours, or mine that is being decided in this room.

What I mean is to encompass the whole, those that are being cared for now and those, of course, coming along.

Mr. ALGER. After the stipulated age of 65?

Governor LAWRENCE. Yes.

Mr. ALGER. Then I misunderstood you. I do not think your statement is quite clear.

Governor LAWRENCE. Thank you.

Mr. ALGER. Are you acquainted with the Colorado experience? As a Governor, are you acquainted with what Colorado did?

Governor LAWRENCE. Mr. Lourie is.

Mr. ALGER. I will not take the time, but you shouid look into that. It is really an eye opener in this field.

1

Governor LAWRENCE. In what respect?

Mr. ALGER. In the fact that people decided to use medical care when the State provided it. The hospital admissions jumped three times almost overnight and they are having a terrible time and now they are having to clamp down because they realize that the Government cannot do it and provide the service without having the people freeloading, a very very interesting commentary on the thing we are talking about here, and I think as a Governor you might be interested in it.

The CHAIRMAN. Any further questions of Governor Lawrence? If not, Governor Lawrence, again we thank you, sir, for taking time from your busy schedule to come to the committee.

Thank you very much.

Governor LAWRENCE. Thank you.

The CHAIRMAN. We are pleased to have the Honorable T. J. Dulski of New York as our next witness.

STATEMENT OF HON. THADDEUS J. DULSKI, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK

Mr. DULSKI. Mr. Chairman, and distinguished members of this committee, I appreciate the opportunity you have given me to present my views in support of the health care legislation which you are now considering for our aged citizens.

I am so strongly convinced of the need for legislation of this type that I introduced Mr. Forand's medical care bill early in this session. The entire question of medical and hospital care has taken on new significance in the light of rapidly increasing costs in this field. The cruelest costs in old age are medical costs. I am asquainted with friends and constituents who have suffered chronic illnesses necessitating extended hospitalization, and their entire life savings have been eaten up by these costs.

While my bill will not completely solve the medical problems of the aged, and it was not designed to attain such a goal, it will guard against total disaster financially as a result of medical misfortunes beyond the control of individuals. The people want and need security from the unexpected medical disasters which are inevitably encountered in their later years.

Statistics show that one of five aged couples drawing social security benefits must go to a hospital each year. Half of these incur bills in excess of $700 a year. This is over one-third of the total annual income of a typical couple, and more than an average food budget for the entire year. Many of these people just do not obtain and cannot afford the care they need.

There are 16 million today in the United States who are over the age of 65. Their physical activity is limited by six times as much disability as the rest of the population. Their annual medical bill is twice that of persons under the age of 65, but their annual income is only half as high, and for many even less.

These are sober facts.

We, in America, are proud of our medical system-the greatest in the world. Our doctors are among the best and most dedicated. They work under a free system, as nearly everyone else in our economy,

and that is the way it should be. But there are too many pitfalls in our present methods of providing for medical problems in the later years of life. There are too many restrictions and inadequacies. Those who need health insurance the most have it the least, and we must have provision for retirement without fear of financial disaster because of illness.

This problem is also beyond the means of local and State governments. We, in Congress, must take action to make certain that our American people will have adequate medical and hospital care without bankrupting themselves. One will never know the true meaning of social security until he reaches the age to which it applies and he has perhaps no other income on which to depend. We can no longer ignore the plight of our aged citizenry.

I earnestly hope that your committee will weigh heavily the testimony favoring this legislation, and report a bill which will provide adequate medical care and hospitalization benefits for our senior citizens.

The CHAIRMAN. Thank you, Mr. Dulski, for coming before the committee today.

Mr. Schottland. I must say that it will hardly be necessary for this witness to identify himself to this committee, having served as the Commissioner of Social Security in the Department of HEW for a period of some 4 or 5 years.

I understand that you are now dean of the Florence Heller Graduate School for Advanced Studies in Social Welfare at Brandeis University.

STATEMENT OF CHARLES I. SCHOTTLAND, ON BEHALF OF THE AMERICAN PUBLIC WELFARE ASSOCIATION

Mr. SCHOTTLAND. That is correct, Mr. Chairman.

The CHAIRMAN. We welcome you back to the committee and you are recognized.

Mr. SCHOTTLAND. Thank you, Mr. Chairman. I am very happy to be back here.

The CHAIRMAN. You will pardon me for not referring to you as Dean Schottland. It will be just Charlie.

Mr. SCHOTTLAND. Thank you.

Mr. Chairman and members of the committee, for purposes of identification for the record, my name is Charles I. Schottland. As a member of the board of directors of the American Public Welfare Association, I am representing that organization here today.

From 1954 through 1958 I was Commissioner of Social Security in the Department of HEW by appointment of President Eisenhower. Prior to that I was director of California State Department of Social Security Welfare.

With your permission, Mr. Chairman, I should like to reserve some time to make some extemporaneous remarks about the cost estimates that have been presented to this committee.

The American Public Welfare Association-Experience and professional knowledge in medical care administration: The American Public Welfare Association is the national organization of State and local public welfare departments and of individuals engaged in public welfare at all levels of government. Its membership includes Federal,

State, and local welfare administrators, welfare workers, and board members from every jurisdiction.

On the basis of discussions and recommendations in our councils, committees, and the conferences we hold throughout the country, the association's board of directors, which represents all parts of the country, adopts official policy positions on issues of current signifi

cance.

These policy positions govern the association's testimony on proposed legislation relevant to the field of public welfare.

The association has supported strongly all sound recommendations for broadening and strengthening the social insurance programs of our country. We have been in the forefront of the groups which have advocated such legislative steps since we find social insurance a means of meeting income maintenance needs which is preferable to public assistance.

In the great majority of the social insurance issues which have come before your committee during the past 25 years, the American Public Welfare Association and your committee have been in agreement on the basic changes that should be made. Injecting a personal note, it has been a pleasure for me to appear before this committee for more than 20 years and to see the vision which this committee has had with reference to social security programs.

I recall that when the 1939 amendments were adopted providing benefits to dependents and survivors, it was said by many that the benefits to such nonworking members of the family would be difficult to estimate, that this provision would present insurmountable problems of administration, and that it had the possibility of wrecking the social security system.

None of these fears or objections has proved valid. Instead, what the 1939 amendments did was to provide a floor of economic security to the children, widows, and other survivors of deceased workers.

Again in 1950, when 10 million more persons were covered by amendments to the Social Security Act which included almost all self-employed groups not engaged in farming or agriculture, objection was raised that it would be almost impossible to administer such a system, since payment of the social security tax could not be achieved through the simple method of payroll deduction.

It was claimed again that it would be impossible to estimate the cost. These fears have proved groundless and today we have the self-employed integrated into the program on the same basis as wage

earners.

Once more in 1954 this committee considered the same objections when it decided to extend OASI coverage to farmers and certain. specified professions, including farm and domestic employees, and to members of State and local retirement systems.

In 1954, also, this committee established the disability freeze followed by disability benefits to permanently and totally disabled workers who were retired prematurely from the market.

In connection with these disability provisions this committee considered the arguments that it would be almost impossible to define disability, that it would be difficult to administer, that the cost could not be estimated with any accuracy, and that the cost estimates presented to this committee by officials of the Social Security Administration were far too low.

Finally, there were groups that felt that paying benefits to workers who retire prematurely from the market because of disability would lead to socialized medicine. None of these arguments has proved to be valid. The disability insurance provisions of the Social Security Act have been administered efficiently; the costs were well estimated, and the program has enabled several hundred thousand persons who cannot work through any fault of their own to be assured of a minimum income with which to buy food, clothing, and shelter.

Once again this committee is faced with another major proposal to extend the social security program. The American Public Welfare Association has studied this and similar earlier proposals, and its conclusions today are based upon an interest in and knowledge of public medical care programs going back to the inception of the association more than 30 years ago.

In presenting our conclusions today, we have drawn upon the experience of the men and women in the ranks of public welfare who administer the medical care programs under public assistance and who administer also the medical-assistance-for-the-aged program under the Kerr-Mills legislation.

These persons are keenly aware both of the need for medical care and the problems of administering medical care programs.

The stimulation and promotion of medical assistance programs of adequate quality, quantity, and coverage has always been considered a major responsibility of the American Public Welfare Association. The association's medical care committee, representing all parts of the country and made up of individuals with experience in health and welfare programs, has studied for many years the medical care problems of the needy and low-income individuals and families, and methods of administering and financing medical services required by them.

In recent years the medical care committee has given special attention to the health needs of the aged. The committee is well able to do so since its membership includes physicians, hospital administrators, State and local public welfare administrators and staff members, and other persons highly qualified in the field of medical care administration.

Our medical care committee is fully familiar with the present extent of medical care programs in public welfare. Although there have been very large expenditures for medical care in a number of assistance programs, there are gaps and deficiencies still existing in many States with respect to the provision of medical care for the needy aged and other needy persons.

Despite developments which have taken place since the passage of the Kerr-Mills bill in 1960, there are even now not more than 15 States in which needy persons, including the aged, can receive all essential medical care with the assistance of public funds.

It is because we have observed so closely and worked so continuously with the administrators of public welfare medical care programs that we feel the association is qualified to conclude that the publicassistance approach to meeting the medical care needs of all the aged is not the total answer to this question.

The association's Federal legislative objectives for 1961, adopted by our board of directors in December 1960, reflect this conclusion in the following objective: