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STATEMENT OF THE AMERICAN MEDICAL ASSOCIATION RE REORGANIZATION PLAN

No. 1, 1953, TO JOINT HEARING OF THE SENATE AND HOUSE GOVERNMENT OPERATIONS COMMITTEE

By Elmer L. Henderson, M. D., past president, American Medical Association,

March 16, 1953 Gentlemen, my name is Elmer L. Henderson. I am chairman of a special liaison committee of the board of trustees of the American Medical Association and also am a former president of the association. Accompanying me today are Drs. Edward J. McCormick, president-elect of the association; Dwight H. Murray, chairman of the board of trustees; Leonard W. Larson, a trustee; and John W. Cline, immediate past president of the association.

I am appearing here today at your invitation to present the position of the association relative to Reorganization Plan No. 1 of 1953. With your kind indulgence, I should like to trace very mriefly the history of the position of the American Medical Association concerning the establishment of a separate governmental department in charge of health affairs.

As early as 1884, at the annual meeting of the house of legates, it was urged that a separate Department of Health be established under a Cabinet officer. In 1891 a committee of 23 members was appointed to petition the Congress on this matter. Further pertinent references appear in the Proceedings of the House of Delegates for each year from 1891 up to and including 1902.

The subject was discussed annually from 1906 to 1913 and from 1917 to 1930. Periodically during the succeeding 22 years the house of delegates has reaffirmed its position in this regard. This position was most recently expressed in detail in a resolution adopted in December 1950 which provided :

Resolved, That the house of delegates of the American Medical Association urges all officers and members of the American Medical Association and all constituent State associations to take immediate steps to implement the passage into law of a bill providing for the coordination and integration of all Federal health activities under an independent agency with Executive status except the medical services of the Armed Forces and the Veterans' Administration."

On last Saturday, March 14, the house of delegates of the American Medical Association met in special session to consider Reorganization Plan No. 1. We were singularly honored by the appearance of the President of the United States, who outlined briefly the position of the administration with respect to governmental medical affairs. In addition, Senator Robert A. Taft and Congressman Walter H. Judd explained and discussed the details of Reorganization Plan No. 1 and the purposes for which it had been submitted.

In summing up the final action of the association in this matter, I should like to read a report of the board of trustees which was adopted unanimously by the house of delegates. (The report is attached.)

MARCH 14, 1953. REPORT OF THE BOARD OF TRUSTEES ON REORGANIZATION PLAN No. 1 OF 1953,

ADOPTED UNANIMOUSLY BY THE HOUSE OF DELEGATES ON MARCH 14 The house of delegates of the American Medical Association has for nearly 80 years been on record as favoring an independent Department of Health in the Federal Government. The reason for this stand has been that the house has felt that health and medicine should be given a status commensurate with their dignity and importance in the lives of the American people, and that they should be completely divorced from any political considerations.

The board of trustees, after careful study of the policy of the American Medical Association with respect to the administration of health activities in the executive branch of the Government, and after studying the reorganization plan for elevation of the Federal Security Agency to Cabinet status submitted by President Eisenhower to the Congress, finds that Reorganization Plan No. 1 of 1953 provides for a special assistant to the Secretary for health and medical affairs. This provision is a step in the right direction which should result in centralized coordination under a leader in the medical field of the health activities of the proposed Department. Health, therefore, is given a special position. The proposed plan, properly administered, will permit more effective coordination and administration of the health activities of the new Department without interference or control by other branches.

Previous attempts to raise the Federal Security Agency from an independent agency to the level of an executive department have been opposed by the association because the plan did not meet these aims.

Inasmuch as Federal health benefits and programs are established by the Congress, an administration bent on achieving the nationalization of medicine cannot reach that goal except with the support of Congress. Therefore, an organizational plan through which Federal health activities are administered, although important, is not nearly so vital an issue as the policies adopted by the Congress of the United States.

The board of trustees recommends that the house of delegates reaffirm its stand in favor of an independent Department of Health but that it support the Reorganization Plan No. 1 of 1953 as being a step in the right direction; that the American Medical Association cooperate in making the plan successful, and that it watch its development with great care and interest.

It should be understood, however, that the association reserves the right to make recommendations for amendment of the then existing law or to press for the establishment of an independent Department of Health, if the present plan does not, after a sufficient length of time for development, result in proper advancement in and protection of health and medical science and in their freedom from political control.

Senator SMITH of Maine. I also ask unanimous consent to insert in the record at this point a statement from the American Public Welfare Association, dated March 16, 1953, signed by Mrs. Marie D. Lane, Washington representative. (The statement referred to above is as follows:)

AMERICAN PUBLIC WELFARE ASSOCIATION,

Chicago, Ill., March 16, 1953. Hon. MARGARET CHASE SMITH, Chairman, Subcommittee on Reorganization, Committee on Government Operations,

Senate of the United States, Washington, D. O. DEAR SENATOR SMITH: The American Public Welfare Association has authorized me to express to you, in this way, its support of Reorganization Plan No. 1 of 1953, transferring the activities and units of the Federal Security Agency to a new Department of Health, Education, and Welfare, with a Secretary of Cabinet rank.

The APWA is a nonpartisan organization composed of State and local public welfare departments, of individuals engaged in public welfare at all levels of government, and of persons outside government who are interested in publicwelfare programs. Its membership is somewhat more than 7,000.

We have consistently supported, over a period of years, that type of reorganization of the FSA which would not only make it a major executive department, but would provide for an Under Secretary and Assistant Secretaries whose duties are not limited to a phase of the program of the Department, but are coextensive with the entire program.

Reorganization Plan No. 1 of 1953 seems to us well conceived to achieve the advantages of departmental status for the three closely related fields of health, education, and welfare. It seems also to safeguard the professional and substantive responsibilities now vested by law in the constituents of FSA and their heads. We agree further that a uniform method of appointment is sound administrative practice, and will provide a legal base to the present cooperative, but personally achieved, interrelation of the three heads.

There are other desirable goals which we think the President's plan will implement or advance. Among these are

(1) Recognition of the reponsibility of democratic government to promote the well-being of individuals through many closely related social programs, of which welfare is one. Other related programs include assistance to individuals and families; extension of special services and protection to children and the aged ; services in the fields of public health and mental hygiene; vocational rehabilitation; and economic protection through contributory social insurance. These services cannot easily be separately administered, since human beings and their needs constitute a single whole.

(2) Recognition that, although primary responsibility for administering public welfare functions rests, in this country, upon the States and their subdivisions, the Federal Government has realized and accepted its responsibility to use its constitutional taxing power to equalize the financial base for public welfare, and to develop nationwide goals and standards. The Federal Government carries out these responsibilities through a variety of grants-in-aid administered by the FSA, and now, under this plan, by a new Department of Health, Education and Welfare.

(3) Recognition that public welfare functions can more efficiently and satisfactorily administered by a single agency at each level of government. This contributes to a consistent philosophy of public welfare and an adequately comprehensive program. As the President said in his message accompanying the plan : "* * * these several fields of Federal activity should continue within the framework of a single department."

(4) Administratively it is a great contribution to economy and efficiency if Federal requirements and procedures related to programs of health, education, and welfare can be simplified and coordinated at the Federal level before reaching the States.

We believe also that acceptance of Reorganization Plan No. 1 of 1953 will be of great service to the people of the United States, the beneficiaries of programs of health, education, and welfare. Not only will it contribute to the integrity and efficiency with which these programs are administered, but it will assure a voice at the highest level of government to speak for their interests, their needs, and their aspirations. Very truly yours,

Mrs. MARIE D. LANE,

Washington Representative. Senator SMITH of Maine. I also ask unanimous consent to include in the record at this point a statement from Dr. Chester D. Swope, chairman of the department of public relations of the American Osteopathic Association, dated March 16, 1953.

(The statement referred to above is as follows:)

STATEMENT OF DR. CHESTER D. SWOPE, CHAIRMAN, DEPARTMENT OF PUBLIC

RELATIONS, AMERICAN OSTEOPATHIC ASSOCIATION The increasing responsibility and stewardship of the osteopathic profession and institutions for the health of the American people are vitally affected by the activities of the Federal Security Agency, including the research, training, medical care, and disease control programs of the Public Health Service, the vocational programs of the Office of Education, the programs of the Office of Vocational Rehabilitation, the health and medical care programs of the Children's Bureau, Public Assistance, and other agencies of the Social Security Administration, and the Food and Drug Administration, all of which activities the pending Reorganization Plan No. 1 of 1953 proposes to transfer to a Deparment of Health, Education, and Welfare.

There are some 12,000 osteopathic physicians or surgeons engaged in active licensed practice in all the States of the United States, and who serve in increasing numbers as school physicians, industrial physicians, health officers, and hospital administrators. More than 400 students graduate annually from the 6 approved schools of osteopathy and surgery; 76 hospitals are approved for intern training; 37 hospitals are approved for resident training in some 16 specialties. In excess of 400 hospitals are staffed by osteopathic physicians and surgeons.

The American Osteopathic Association through an elected house of delegates and a board of trustees represents the osteopathic profession, approves the colleges and training hospitals, and registers hospitals staffed by doctors of osteopathy. The primary objective of the association is “to promote the public health."

Neither the house of delegates nor the board of trustees of the Association has met since Reorganization Plan No. 1 of 1953 was submitted to the Congress on March 12, 1953, but past pronouncements on the part of the association have anticipated with approval such a plan for creating a Department of Health, Education, and Welfare. Therefore, I am pleased to express the support of the American Osteopathic Association for the plan and to pledge our cooperation in effecting the high purposes of the proposed Department of Health, Education, and Welfare.

When a bill (S. 140) or a Department of Health, Education, and Security was pending before the Congress in 1947, we appeared before the Senate Committee on Expenditures in the Executive Departments to seek amendments which we deemed vital to the public interest ånd which would operate to inspire the confidence of our profession and its institutions. Our primary objection to that bill was that it sought to establish in the basic law certain preferences as between the legalized professions of the healing arts. I am happy to observe that that objection is not applicable to Reorganization Plan No. 1 of 1953.

The 1947 proposal specifically required the Secretary to appoint advisory committees in the field of health. We pointed out at that time that the legislative intent should be made clear that the organized osteopathic profession and institutions should be included in such advisory councils. The committee report expressly recognized our contention and referred to language added to the bill to attain the purposes involved. Although Reorganization Plan No. 1 of 1953 makes no reference to advisory committees on health matters, we are confident that the expedient of advisory committees will be employed by the Department, and that the Secretary and the special assistant who is charged with review and advice to the Secretary regarding improvement and legislation in the health and medical programs of the Department will carry out the spirit of the recommendations of the 1947 committee regarding representation on advisory committees.

We welcome the prospect of working with the current Federal Security Administrator, Mrs. Oveta Culp Hobby, as the first Secretary of the Department of Health, Education, and Welfare, and we hope that House Joint Resolution 223 which advances the effective date of the plan will be adopted by the Congress without delay.

Senator Smith of Maine. Without objection, those statements will be included in the record. Will it be convenient, Mr. Dodge, for you to return at 2 o'clock this afternoon?

Mr. DODGE. I have a series of budget meetings this afternoon beginning at 2 o'clock, but if you need me here I will be here.

Senator Smith of Maine. We will certainly try to abide by the rules on the time for questions and in this way we hope that we may finish the hearing this afternoon.

We will recess until 2 o'clock this afternoon.

(Whereupon, at 12:04 p. m., the committee recessed until 2 p. m. this day.)

AFTERNOON SESSION

a

(At the hour of 2 p. m. of the same day the proceedings were resumed.) Senator Smith of Maine. The committees will be in order. Mr.

. Dodge is here. Thank you, Mr. Dodge, for coming back.

Mr. Hoffman.

The CHAIRMAN. All right. Mr. Mollohan, you said you had no questions.

Mr. MOLLOHAN. No questions.
The CHAIRMAN. Mr. Condon.
Mr. CONDON. I have some questions.

Mr. Dodge, start off with what is going to be the immediate annual cost in the terms of increase in salaries if this measure becomes law.

FURTHER STATEMENT OF JOSEPH M. DODGE, DIRECTOR, BUREAU

OF THE BUDGET, ACCOMPANIED BY WILLIAM F. FINAN, ASSISTANT DIRECTOR, BUREAU OF THE BUDGET

Mr. DODGE. With the change in status with the officers under the department rather than the agency, and with the addition of the special assistant for health and medical affairs, the increased annual cost is $32,500 in a department whose annual expenditures approximate $1,900,000,000.

Mr. Condon. Now, breaking that $32,500 down, that amounts to how much which will be the increase that the new Cabinet member will get?

Mr. DODGE. Just a minute. The present Administrator receives a salary of $17,500; under the new office of Secretary it will be $22,500.

Mr. CONDON. $5,000 increase.
Mr. Dodge. That is right.
Shall I read the rest of the list?
Mr. Condon. Yes, I wish you would.

Mr. DODGE. The Assistant Federal Security Administrator, who heretofore has been appointed by the Administrator, had a salary of $15,000, and as an Under Secretary would have a salary of $17,500, an increase of $2,500.

Mr. CONDON. And there is some person now performing the
Mr. DODGE. That is right.
Mr. CORDON. Function of the Under Secretary; is that correct?
Mr. DODGE. Yes. This is a transfer of function with a new title.
Mr. CONDON. What about the Assistant-

Mr. DODGE. The assistant head of the Federal Security Agency, who is now appointed by the Administrator, is under the classified system and receives a salary of $10,000. He would become an Assistant Secretary for Health, Education, and Welfare and would receive a salary of $15,000.

Mr. CONDON. A $5,000 increase.
Mr. DODGE. Right.
Mr. CONDON. Someone is now filling that function?
Mr. DODGE. Pardon?

Mr. CONDON. Someone is now filling that function of Assistant Secretary; is that correct?

Mr. DODGE. Not exactly. It was under a different form.

Mr. CONDON. Do you spell out the duties at all of this Assistant Secretary

Mr. DODGE. No.

Mr. CONDON. This is the one where the requirement is that there must be this non-governmental medical background; is that correct?

Mr. DODGE. No.
Mr. CONDON. No?

Mr. DODGE. This was an administrative officer and assistant head of the Federal Security Agency.

Mr. Condon. Maybe at this point I might ask this question: It seems to me that your bill, the Reorganization Plan No. 7, is substantially identical to the Reorganization Plan No. 27. In other words, I have noticed in comparing them, for example, you have used the identical wording in many of the sections which is literally taken from the plan that President Truman submitted in 1950.

I noticed one curious condition—at least it seemed to me curious and that is, the plan that President Truman submitted was an attempt to spell out in some detail the duties of these Assistant Secretaries. In transforming and taking over the Truman plan, you eliminated or omitted any specification of the duties of these Assistant Secretaries.

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