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Mr. COTHRAN. Yes, sir.

Mr. Evins. I think that is a very helpful study that you have provided.

Mr. COTHRAN. Thank you.

Mr. Evins. You made a statement concerning the disproportionate amount of expenditures made for education as compared with compensation and pensions. Is it your view that we should not reduce the amount of funds for education, but that there should be an increase in compensation and pensions, in payments other than for education?

Mr. COTIIRAN. That is correct. We think we should not deny one in favor of the other. We think this is one of the great problems that you are going to have to decide—that is, which is the best avenue to take-but we think you ought to give due regard to both groups.

Mr. Evins. As you know, in the old days, in the old Committee on Pensions, it used to be the policy to pay the boys and be finished. They were paid off and more or less forgotten. The new policy is to provide them with education and training so that they may help themselves to become better citizens. That is the new approach, instead of just paying them off and forgetting about them; that is, to give them aid in order to get education, in order that they may help themselves to become more useful citizens. You would not advocate a departure from that new policy?

Mr. COTHRAN. No, sir; we are advocating the two together.
Mr. Evins. I just wanted that point emphasized.

Mr. KETCHUM. May I suggest one other thing? There is the possibility that perhaps the cost of educational aid, the cost of the training program might be charged properly to some other part of the national interest rather than specifically to the veterans benefit program. We realize that that is going to veterans, but I think the net result of the educational aid and training program is to make better ciitzens, make more productive citizens for the United States. It seems to me that that could well come under the heading of the national welfare or even of Federal aid to education which it has been in a sense.

Mr. Evins. I think that point is well taken.

Mr. TEAGUE. I am sure you know that one of the reasons why the American Council on Education supported our GI bill last year was because for years they have advocated scholarship aids in their programs and this gave them a chance to try it. If it works, they may come to Congress for a Federal aid to education program of that type.

Mr. KEARNEY. I should like to make one observation with respect to the comments made by Mr. Ketchum a moment ago. If that were to come about as you suggested, Mr. Ketchum, it might give these various Government agencies a chance to take over an activity that belongs to the Veterans Administration and you will be moving toward a dismemberment of the Veterans Administration.

Mr. KETCHUM. They run that risk, of course, General, whenever you do that. Perhaps later on they will say that it ought to be administered by the Federal Security Agency, or the Office of Education, instead of coming through this Veterans Committee and the Veterans Idministration. But that is a calculated risk.

All we are seeking to do here is to point out that if you have only so much money to spend—and I am sure this committee appreciates that everything it does, the House leadership and the administration are going to ask questions about the cost—if you have only so much money to spend, where are you going to put the emphasis?. If you are spending one-fourth or more on educational aid and training, does that mean that you are going to have to slough off on the other types of benefits which, in our opinion, are fundamental; such as compensation and hospitalization and outpatient care and vocational rehabilitation? We do not believe that those essential activities should suffer in any way because of the heavy cost of educational aid for veterans. Therefore, we are seeking merely some sort of a solution, if it is possible, to transfer this cost as an obligation away from the veterans' benefit program, because it would put you in amuch better position to deal more generously and liberally with the really fundamental benefits afl'ecting our disabled veterans.

Mr. Evins. I think that statement is well taken and I should like to ask one other question. The Booz-Allen-Hamilton survey, with the conclusions of which we all largely disagree, says that the Veterans' Administration is crystallizing rather than adapting itself to changing conditions; that it confuses operating and staff functions and that it is getting old and atrophied. That is the consensus of its conclusion; that it is not adapting itself to changing conditions and, of course, they recommend some changes with which we do not agree.

But I have had presented to me recently by a number of doctors and operators of hospitals a proposal known as the Tennessee plan with which you may be familiar, regarding veterans hospitalization. We have had built over the past several years a number of HillBurton hospitals in small towns throughout the country. They are encountering difficulty in maintaining those hospitals which the Government has built, fine hospitals, in towns of 15,000 and 20,000. They are not being operated to capacity as they expected. In effect they are federally subsidized. It has been proposed that a veteran be permitted to receive medical care and treatment in a Hill-Burton hospital, where that hospital is close by to his town, if he so desires and indicates such preference, instead of having to take the bus and go to Cincinnati or to Memphis, and then let the Veterans Administration compensate that local hospital for the service rendered that veteran.

I wonder if the commander would care to express his views on that at this time.

Mr. COTHRAN. I suggest that Colonel Ijams would be the best man on our staff to speak to that.

Mr. Evins. The idea behind this, of course, is to utilize existing hospitals and make them available to veterans on the local level, so that he might be provided medical care and services. Speaking as a member of the Hospital Subcommittee, I think we are going to be confronted with that proposition.

Mr. KEARNEY. May I say to the gentleman-and I do not want to be facetious about this that for $600,000 I, as an attorney, could confuse that issue.

Mr. Evins. I agree with you.

The CHAIRMAN. The $600,000 which the gentleman mentions was the cost of the Booz-Allen-Hamilton Report.

Mr. IJAMS. As the members of this committee know, service-connected cases only may be hospitalized in outside hospitals—that is, outside of the Government hospitals—at Federal expense. There is presently available to the Administrator an opportunity to put service-connected cases in these hospitals which have been built in the local communities. I might say that those hospitals that were built under the Hill-Burton Act were largely placed in those communities to meet the demands of an influx of personnel into those communities who were participating in the war effort. In most cases you will find that they did not have adequate hospital facilities for the residents of those communities to say nothing of the influx of new people who came in.

Service-connected cases may now be placed in those hospitals, but there has always been very serious opposition on the part of the medical fraternity in this country to hospitalization in private institutions for non-service-connected cases. Their feeling has been that these men should be placed in their hospitals and should be made to pay for the service.

Now, there are veterans who can afford to pay for their own hospitalization for non-service-connected conditions. We have never advocated, in the Veterans of Foreign Wars, that the Federal Government pay the hospital costs either in Federal hospitals or private hospitals, of those cases where the veteran can afford to pay for his own hospitalization.

But we have called attention to the fact that there are three groups of veterans—the psychiatrics, the tuberculars and the old chronic cases that are totally disabled, who cannot take care of their families, who cannot feed their families and who, when they become ill, require long periods of hospitalization and we have contended, in the absence of private facilities in their home communities, it is incumbent upon the Federal Government for which they fought, to provide that hospitalization.

I am afraid that if a proposal is entertained to hospitalize non-service-connected cases in Hill-Burton hospitals or any other type of private institution, that you are going to get the darnedest reaction from the medical fraternity that you have ever heard.

Mr. Evins. We are not thinking so much about the medical fraternity as we are about the veteran.

Nr. IJAMS. That was the purpose of building these hospitals, in order that they might provide facilities in these isolated communities, so that these people could get hospitalization as close to their homes as possible, without requiring them to travel perhaps hundreds of miles.

I recall just a few years ago—it was in the 80th Congress and Senator Morse was the chairman of the subcommittee of the Senate; and Congressman Kearney will remember quite will, because there was brought into this room at that time one of the biggest petitions I have ever seen, and I have been around Washington for 35 years. We were then debating taking over Camp White in Iowa and the hospital at Medford which the Army had utilized and then which the Army had abandoned-taking those two institutions over into the Veterans Administration. And there was a petition brought in here that must have been 6 feet tall, rolled up on a big wheel and signed by several hundred thousand veterans of Illinois, Iowa, and Indiana, the sur

rounding States, urging this committee to take over the Schick General Hospital at Clinton, Iowa, for veterans.

This committee passed that legislation and also the Medford, Oreg., legislation.

But, getting back to the hearing in the Senate, I was setting in the audience when Dr. Hawley and Dr. Magnusson, both of whom were in the Veterans' Administration, were opposing quite strenuously a hospital for southern Oregon. The statement was made that nobody could find out why a hospital had been recommended for that area and I got up and suggested to the chairman that I might perhaps answer the question, because it had come up when I was still with the Veterans' Administration.

I pointed out that there was not a hospital, a Federal hospital, between San Francisco, Calif., and Portland, Oreg. I did not know the exact distance between those points and I make the guess that is was something like 700 miles and the Senator supplied the information that it was 57 miles further. So that we had a situation there where veterans living in that area were, many of them, over 300 miles away from the nearest hospital.

That is the reason I recommended while I was still in the Veterans' Administration, no specific point, but a hospital for northern California or southern Oregon. Later this Medford, Oreg., hospital became available and met the requirements. But they tried to place these hospitals where the families of the veterans could not get to the veterans who were in the hospitals and where the families would have been put to the expense of going over 2 or 3 State lines in order to make a visit to their boys.

The CHAIRMAN. Are there any other questions? Mr. Hagen. I would like to ask one of you gentlemen your reaction to the action of the Appropriations Committee in slashing the request for supplemental appropriations for the Veterans Administration. They recommended $15 million, as these other organizations did. I notice that that supplemental request was cut by about $9 million.

I believe that will come up for action on the floor this week and they have only $5 million earmarked for services for hospitals. I am wondering what that is going to do with the hospitalization program for the balance of the year.

The CHAIRMAN. I think it will hurt very much. I was talking with some people yesterday and they advised that instead of having an attempt to restore some of these items on the floor of the House it would be better to wait until the bill got over to the Senate.

Mr. COTHRAN. We think $15 million is the absolute minimum that they need for the hospitals alone.

Mr. KETCHUM. May I explain that the supplemental appropriation which was submitted by the Veterans' Administration does not cover the request that we are making. As a matter of fact, they have very little in the total supplemental deficiency appropriation that they requested to do the job that we are talking about. Actually they only put about $5 million in there and that is mostly to open up new hospital beds not to open up the beds that were closed and to get back again the services that were lost as a result of inadequate appropriations last year.

We suggest $15 million immediate supplemental appropriations for the medical program to restore the lost beds and the services lost as

a result of inadequate appropriations. We believe that is the very minimum for operation for the balance of the current fiscal year and if that appropriation is not granted within a reasonably short space of time, it is not going to do any good to get it, because you are going to run into the next fiscal operation of the Veterans' Administration. That is why we are making that specific request.

We realize that your committee does not recommend deficiency appropriations. But I am afraid, if the Appropriations Committee should take the bull by the horns, so to speak, some group in the Congress has got to bring this matter to the attention of the leadership and insist on getting this extra $15 million for the hospital program.

Mr. HAGEN. This outpatient program has sort of folded, has it not?

Mr. KETCIUM. It is practically at a standstill because of a lack of funds.

Mr. HAGEN. Would that be difficult to restore if you had this supplemental money!

Mr. KETCHUM. No. We can get busy on that right away, particularly dental treatment. That is one of the biggest lacks in the whole program at the present time.

Mr. EDMONDSON. Mr. Hagen, do you not agree with me--I think the commander will also agree—that if a priority is to be given on appropriations either for the purpose of completing new construction or of restoring services that have been shut down-that that priority should be placed on putting back into operation these closeddown wards?

Mr. KETCHUM. That is right.
Mr. EDMONDSON. That is, before new construction?
Mr. KETCHUM. That is right.

Mr. TEAGUE. Last year a number of the members of this committee very carefully questioned the Appropriations Committee as to what these cuts were going to do. We were assured that it would not hurt the medical program. We found out later that about $31 million was cut off the medical program.

I think the Appropriations Committee ought to come up with exact statements of where this money was used, if it was not used the medical program, or they ought to put the money back in. So far as I am personally concerned, I expect to try to do something to put the money back in unless the Appropriations Committee can show us where the Veterans' Administration used this money that was supposed to have gone into the medical program. Admiral Boone is coming up tomorrow and we ought to be able to find out.

Mr. KETCHUM. I agree with you, sir, that tomorrow morning this committee ought to find out from the Veterans Administration whether there were adequate funds appropriated for the medical program and, if so, why have we had this loss of beds and services.

Frankly—and I do not think this is any secret—when the Veterans' Administration submitted this supplemental appropriation that you are talking about, the reason they did not put in that $15 million is because they were ordered by the budget not to put it in.

Mr. TEAGUE. Either this committee was misinformed last year, or the Veterans Administration used this money somewhere else and, if so, we ought to find out where it was used.

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