payment or nonprofit insurance carriers under appropriate contracts entered into between such carriers and the State agency;

"(m) provide that such contracts extend health insurance coverage to individuals eligible therefor under the State plan of any or all of the following: (1) Services rendered by licensed physicians, licensed dentists, and, under the supervision of licensed physicians or dentists, by auxiliary personnel, (2) the use by such licensed or auxiliary personnel of any and all apparatus or machines designed to aid in the diagnosis or treatment of disease or injury, (3) the provision of bed and board in general or special hospitals, skilled nursing or convalescent homes, or other institutions licensed or designated as such institutions is prescribed by and under the supervision of licensed physicians, and (4) the provision of drugs and medicines, dressings and supplies, protheses and appliances, and ambulance service, when prescribed by licensed physicians: Provided, That any such contract shall insure against 100 per centum of the cost of not less than (A) 21 days each year of hospital, or equivalent nursing home care, (B) physician's services for 12 home or office visits each year, (C) the first $100 each year of costs incurred for ambulatory diagnostic, laboratory, and X-ray services, and (D) visiting nurse's services (when prescribed by a physician and rendered through a public or private agency) for not less than 24 visits each year; and "(n) make adequate provision out of general revenues of the State for the expenses incurred by the State under such plan.

"PAYMENT TO STATES

"SEC. 804. (a) From the sums appropriated therefor, the Secretary of the Treasury shall pay to each State which has an approved plan for health insurance for the aged, for each quarter (beginning with the quarter commencing July 1, 1961) (1) an amount equal to the Federal percentage of the amount by which the amount produced by multiplying—

"(i) the per capita premium cost up to but not exceeding $13 per month, by

"(ii) the sum of the total number of subscribers of health insurance for the aged for each of the months in such quarter,

exceeds the total sum of the amounts actually paid by such subscribers as subscription charges during each of such months; plus (2) an amount equal to one-half of the sums expended during such quarter as found necessary by the Secretary of Health, Education, and Welfare for the proper and efficient administration of State plan.

"(b) The method of computing and paying such amounts to the State shall be as follows: The Secretary shall, prior to the beginning of each quarter, estimate the amounts to be paid to the State under subsection (a), such estimate to be based on (A) reports filed by the State containing its estimates of the total sums to be expended by it in such quarter in accordance with subsection (a), and (b) such other investigation as the Secretary may find neces

sary.

"(c) The Secretary shall then certify to the Secretary of the Treasury the amount so estimated by the Secretary, reduced or increased, as the case may be, by any sums by which he finds that his estimates for any prior quarter were greater or less than the amounts which should have been paid to the State under subsection (a).

"(d) For the purposes of this section the ‘Federal percentage' for any State shall be 100 per centum less that percentage which bears the same ratio to 50 per centum as the per capital income of such State bears to the per capita income of the continental United States (including Alaska and Hawaii), except that (1) the Federal percentage shall in no case be more than 75 per centum or less than 33 per centum, and (2) the Federal percentage for Guam, Puerto Rico, and the Virgin Islands shall be 75 per centum each. The Federal percentages shall be promulgated by the Secretary between July 1 and August 31 of each evennumbered year, on the basis of the average of the per capita incomes of the States and of the continental United States (including Alaska and Hawaii) for the three most recent consecutive years for which satisfactory data are available from the Department of Commerce.

"OPERATION OF STATE PLANS

"SEC. 805. (a) If the Secretary, after reasonable notice and opportunity for hearing to the State agency, finds (1) that the State agency is not complying

substantially with the provisions of the State plan, or (2) that any Federal funds have been diverted from the purposes for which they have been paid under this title, the Secretary shall forthwith withhold further payments to the State under section 804 until he is satisfied that the conditions which required him to withhold such payments no longer exist.

"(b) If any State is dissatisfied with the Secretary's action under subsection (a), such State may appeal to the United States court of appeals for the circuit in which such State is located. The summons and notice of appeal may be served at any place in the United States. The Secretary shall forthwith certify and file in the court the transcript of the proceedings and record on which he based his action.

"(c) The findings of fact by the Secretary, unless substantially contrary to the weight of evidence, shall be conclusive; but the court, for good cause shown, may remand the case to the Secretary to take further evidence, and the Secretary may thereupon make new or modified findings of fact and may modify his previous action, and shall certify to the court the transcript and record of the further proceedings. Such new or modified findings of fact shall likewise be conclusive unless substantially contrary to the weight of the evidence.

"(d) The court shall have jurisdiction to affirm the action of the Secretary or to set it aside, in whole or in part. The judgment of the court shall be subject to review by the Supreme Court of the United States upon certiorari or certification as provided in title 28 of the United States Code, section 1254.

"AUTHORIZATION OF COMPACTS BETWEEN STATES

"SEC. 806. In order that individuals who are covered by a health insurance program established under this title by the State in which they reside shall not, by reason of their temporary presence in another State at the time benefits provided by such program are needed by them, be hampered in actually receiving such benefits, the consent of Congress is hereby granted to any two or more States to enter into appropriate compacts or agreements with respect to the administration and operation of their respective health insurance programs established under this title.

"ADMINISTRATION

"SEC. 807. (a) The Secretary is authorized to make such administrative regulations and perform such other actions including the negotiation of a schedule of subscription charges under each State plan as he finds necessary to carry out the provisions of this title.

"(b) In administering the provisions of this title, the Secretary is authorized to utilize the services and facilities of any executive department of the Government in accordance with an agreement with the head thereof. Payment for such services and facilities shall be made in advance or by way of reimbursement, as may be agreed upon between the Secretary and the head of the executive department furnishing such services or facilities.

"(c) In administering this title the Secretary shall cooperate with and render advice and assistance to States and the appropriate public authorities therein formulating and operating State plans under this title.

"SAVINGS PROVISION

"SEC. 808. Nothing in this title shall modify obligations assumed by the Federal Government under other laws for the hospital and medical care of veterans or other presently authorized recipients of hospital and medical care under Federal programs."

The table of contents on page 4 is appropriately amended.

13. AMENDMENT 6-27-60-I-INTRODUCED BY SENATOR SCHOEPPEL (IDENTICAL TO THE FOLLOWING AMENDMENTS: NO. 8, 6-27-60-A, INTRODUCED BY SENATOR KEATING; NO. 16, 6-28-60-C, INTRODUCED BY SENATOR HUMPHREY; AND NO. 24, 6-29-60-X, INTRODUCED BY SENATOR HARTKE)

STAFF ANALYSIS

Increases the soocial security earnings limitation from $1,200 to $1,800 per

year.

Cost.-$616 million per year, or 0.19 percent of payroll, on a level-premium

basis.

Financing. No tax increase provided to cover added cost to program.

VIEWS OF DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE ON AMENDMENT 6-27-60-I

See joint report on page 480.

TEXT OF AMENDMENT 6-27-60-I

Intended to be proposed by Mr. SCHOEPPEL to the bill (H.R. 12580), viz: On page 80, between lines 3 and 4, insert the following new section: SEC. 211. (a) (1) Paragraphs (1) and (2) of subsection (e) of section 203 of the Social Security Act are amended by striking out "$1,200" wherever it appears therein and inserting in lieu thereof "$1,800", and (2) such paragraphs and paragraph (1) of subsection (g) of such section are amended by striking out "$100 times" wherever it appears therein and inserting in lieu thereof "$150 times".

(b) The amendments made by subsection (a) shall be effective, in the case of any individual, with respect to taxable years of such individual ending after 1960.

14. AMENDENT 6-28-60-A-INTRODUCED BY SENATORS HUMPHREY AND JAVITS

STAFF ANALYSIS

Modifies the social security definition of disability for both benefit and "freeze" purposes so that a specified degree of blindness, more liberal than the present definition for the disability "freeze," is presumptively disabling. Provides that an individual otherwise eligible can qualify for disability benefits with one quarter of coverage (present law requires fully insured status plus coverage in 20 of the 40 quarters prior to the onset of the disability). Exempts such blind beneficiaries from the provision of present law which requires deduction from benefits because of refusal to accept rehabilitation services. Cost.-0.03 percent of payroll on a level-premium basis.

Financing. No tax increase provided to cover added cost to program.

VIEWS OF DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE ON AMENDMENT 6-28-60-A

As we indicated in our report on S. 3067, our major objection to the proposed amendment is that it would give persons with visual impairments very great advantages over other persons with equally severe impairments of another type. Blindness is no more disabling insofar as work is concerned than many other severe types of impairment. As a matter of fact, many blind persons have demonstrated the ability to earn a living in spite of their impairment and much is being done through both public and private means to encourage and aid the blind to be self-supporting. Special legislation permitting some individuals to receive benefits under conditions identical to those under which benefits are denied to others is, in our opinion, undesirable and contrary to sound principles of equity and justice.

There are also other aspects of the proposed amendment to which we have serious objections. It would, in effect, provide disability benefits for persons who are able to work and who may be working regularly. It would also provide benefits for persons who have had no significant employment. Such pro

visions would extend the purpose of the disability program from providing a partial replacement of earnings that are lost because of disability to providing an indemnity for certain handicaps. We believe indemnity against handicap is not a proper purpose of the old-age, survivors, and disability insurance program. There is another reason why the Department would not favor a proposal for providing disability benefits for persons who have never been regularly employed. (One quarter of coverage for eligibility for benefits would not, of course, be evidence of regular employment.) Under the present program, the right to benefits is acquired as a result of work and benefit amounts are related to earnings. Benefits are financed in part through contributions paid by the worker while he is working. All social security taxes paid by employers, employees, and self-employed persons go into special trust funds. In order to establish that the person has earned the right to benefits the program requires that he be credited with a specific amount of covered work. Payment of benefits to people who have not met the work requirements of the program would tend to undermine the contributory character of the program, attenuate and obscure the relationship between prior work and benefits, and lead to public misunderstanding of the nature and purpose of the program.

For these reasons the Department recommends that the proposed amendment not be enacted.

TEXT OF AMENDMENT 6-28-60-A

Intended to be proposed by Mr. HUMPHREY and Mr. JAVITS to the bill (H.R. 12580), viz: On page 110, after line 22, insert the following:

(c) (1) Section 223 (a) (1) of such Act (as amended by section 403(b) of this Act) is further amended by striking out "the month in which he dies, the month in which he attains the age of sixty-five, or the third month following the month in which his disability ceases" and inserting in lieu thereof "the month in which he dies, the month in which he becomes entitled to old-age insurance benefits (in the case of an individual whose disability is blindness (as defined in subsection (c) (2)) and who is not fully insured when he attains retirement age), the month in which he attains the age of sixty-five (in the case of any individual whose disability is not blindness (as so defined)), or the third month following the month in which his disability ceases".

(2) Section 223 (c) (1) of such Act is amended

(A) by inserting ", other than an individual whose disability is blindness (as defined in paragraph (2))," after “An individual"; and

(B) by adding after subparagraph (B) the following new sentence: "An individual whose disability is blindness (as defined in paragraph (2)) shall be insured for disability insurance benefits in any month if he had not less than one quarter of coverage before the quarter in which such month occurs. (3) Section 223 (c) (2) of such Act is amended by striking out the first sentence and inserting in lieu thereof the following: "The term 'disability' means (A) inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or to be of long-continued and indefinite duration, or (B) blindness. The term 'blindness' means central visual acuity of 20/200 or less in the better eye with the use of correcting lenses, or visual acuity greater than 20/200 if accompanied by a limitation in the fields of vision such that the widest diameter of the visual field subtends an angle no greater than twenty degrees." (4) Section 216(i) (1) of such Act is amended—

66

(A) by striking out "blindness" and all that follows in the first sentence and inserting in lieu thereof "blindness (as defined in section 223 (c) (2)),”; and

(B) by striking out the second sentence.

(5) The last sentence of section 223 (c) (3) of such Act is amended by inserting except an individual whose disability is blindness (as defined in paragraph (2))," after "for any individual”.

(6) The first sentence of section 222(b) (1) of such Act is amended by striking out "an individual entitled to disability insurance benefits" and inserting in lieu thereof "an individual (other than an individual whose disability is blindness as defined in section 223 (c) (2) entitled to disability insurance benefits".

(7) The amendments made by this subsection shall apply only with respect to monthly benefits under title II of the Social Security Act for months after the

month in which this Act is enacted. In the case of an individual who satisfies section 223 (a) (1) (B) of such Act on the date of the enactment of this Act solely by reason of such amendments, the waiting period (as defined in section 223 (c) (3) of the Social Security Act) may not begin before the first day of the fifth month before the month in which this Act is enacted.

15. AMENDMENT 6-28-60-B-INTRODUCED BY HUMPHREY

STAFF ANALYSIS

While not making any substantial change in services which can be provided under existing law, makes more explicit the definition of "child welfare services." The amendment follows generally the language recommended by the Advisory Council on Child Welfare Services (authorized by the 1958 amendments), on the ground that such language would provide "greater latitude for inclusion of services dealing with any social problem affecting the well-being of children and eliminates the possibility of a narrow interpretation of the scope of services." Text of present definition and new definition is contained in text of the amendment.

Costs.-Department of Health, Education, and Welfare advises that this amendment will not increase the cost of the program.

VIEWS OF THE DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE ON AMENDMENT

6-28-60-B

The amendment to H.R. 12580, proposed by Senator Humphrey June 28, 1960. changes the definition of child-welfare services in title V, part 3, of the Social Security Act. The new definition is substantially the one that was recommended by the Advisory Council on Child Welfare Services in its report to Congress January 1, 1960.

The present definition is that these services are for the protection and care of homeless, dependent, and neglected children, and children in danger of becoming delinquent. It has been quite adequate for the type of legislation provided in that act. Grants have been made to State public-welfare agencies to establish, extend, and strengthen these services. These grants, for the most part, have been small in comparison to child-welfare expenditures from State and local funds.

The definition proposed by the Advisory Council is related to another recommendation of the Council, namely, that the Federal Government pay part of the total cost of public child-welfare services of each State and other cooperating jurisdictions through Federal grants-in-aid on a variable basis, with provision for an open end appropriation and with continuing encouragement to establishing, extending, and strengthening of such services.

The new definition is somewhat more explicit, particularly in relation to juvenile delinquency, than the present definition, although the term "in danger of becoming delinquent," together with other parts of the present definition, is inclusive enough to enable the States to use the grants to provide services to delinquent as well as to predelinquent children.

Title V, part 3, of the Social Security Act makes clear that these grants are for the purpose of establishing, extending, and strengthening public childwelfare services. By eliminating the word "public" in the new definition under the bill, question is raised as to whether these grants could be used to establish, extend, and strengthen child-welfare services under voluntary auspices. This change was not included in the Council's recommendation.

The Department recognizes the logic of the Advisory Council's recommendation embodied in this amendment in the context of other recommendations made by the Council, but does not believe that it serves the same purpose as a separate piece of legislation. In view of the questions it raises, we would not recommend its adoption.

TEXT OF AMENDMENT 6-28-60-B

Intended to be proposed by Mr. HUMPHREY to the bill (H.R. 12580), viz: On page 183, after line 20, insert the following new paragraph:

(4) Section 521 of such Act (as amended by subsection (a) (3) of this section) is further amended