Source: Statistical Abstract of the United States, 1962, table 64, p. 61. Mr. EVERETT. Any other questions? The meeting is adjourned. (Whereupon, at 11:30 a.m., the subcommittee adjourned, subject to the call of the chair.) INTERMEDIATE CARE FACILITIES WEDNESDAY, MAY 15, 1963 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON INTERMEDIATE CARE OF THE COMMITTEE ON VETERANS' AFFAIRS, Washington, D.C. The subcommittee met at 10 a.m., pursuant to recess, in room 356, House Office Building, Hon. Robert A. Everett (chairman of the subcommittee) presiding. Mr. EVERETT. The subcommittee will come to order. Before we start this morning, I have a letter here from Mr. Cecil B. Dickson, legislative representative of the American Medical Association, addressed to the chairman of the full committee, the Honorable Olin E. Teague, and, without objection, it will be inserted in the record at this point. (The letter referred to follows:) Hon. OLIN E. TEAGUE, AMERICAN MEDICAL ASSOCIATION, Chairman, House Committee on Veterans' Affairs, DEAR MR. CHAIRMAN: This refers to H.R. 224, the bill introduced by you to provide for assistance to veterans in need of regular aid and attendance in obtaining drugs and biologicals. The bill would include "drugs and biologicals" listed in the "United States Pharmacopoeia," "National Formulary," and "New and Non-official Remedies." The American Medical Association wishes to call your attention to the statement of purpose of N.N.D., as follows: "The Council on Drugs finds it necessary to emphasize that "New and Nonofficial Drugs" does not constitute a list of approved, accepted, or useful drugs. The purpose of the volume is to inform the reader of the Council's evaluation of available new drugs on the basis of the evidence. Drugs which the Council and its consultants consider to be of questionable or of unproved value are included along with drugs that are considered useful. Mere inclusion, therefore, does not constitute Council endorsement of the efficacy of a drug. It follows, therefore, that the index should be used solely to locate the description of a given drug, and not as an indication of a drug's approval." With regards, I am, CECIL B. DICKSON. Mr. EVERETT. We are meeting this morning to receive testimony from the Bureau of the Budget and I am happy to say that an old and esteemed friend of this committee, Mr. Phillip S. Hughes, the Assistant Director for Legislation of the Bureau of the Budget, is to be our witness. This committee over the years has found on numerous occasions in conflict with the official position expounded by the Bureau of the Budget on the part of the administration, but this has never in any way affected our esteem and deep respect for the individuals who work in the Bureau of the Budget and who all too often do not get credit for the unusually fine performance of their work. Few, if any, officials of the Bureau enjoy a higher level of respect and admiration than does Mr. Hughes, whom we welcome this norning. STATEMENT OF PHILLIP S. HUGHES, ASSISTANT DIRECTOR FOR LEGISLATIVE REFERENCE OF THE BUREAU OF THE BUDGET Mr. HUGHES. Thank you very much, Mr. Chairman, particularly for those very kind words. I appreciate them very much. On behalf of the Bureau of the Budget, I should like to express appreciation for the opportunity to appear before your committee to discuss the problem of nursing home care as it relates to veterans and to express the opposition of the administration to the legislation under consideration. The committee has under consideration H.R. 224, H.R. 226, H.R. 241, H.R. 244, H.R. 245, H.R. 246, H.R. 247, H.R. 3538, H.R. 5924, and House Joint Resolution 1. These bills would authorize the provision of outpatient care, drugs, therapeutic devices, nursing home care, or additional pensions to veterans without service-connected ailments. The nursing home care problem would be approached either (1) By the direct operation of beds for such care in Veterans' Administration facilities; (2) By contracting for care in community facilities; (3) By grants to States for the construction and/or operation of nursing home beds; or (4) By supplemental payments to veterans to enable them to obtain such care on their own initiative. All of these proposals would involve an extension of veterans' programs in a new direction. H.R. 3538 would also significantly affect the existing hospital care program by lifting the present 125,000-bed ceiling and dropping the financial statement presently required before admission to Veterans' Administration hospitals. We believe all these bills and resolutions raise major issues of policy, particularly as they apply to veterans' disabilities not related to mili tary service. It is a widely accepted principle in the field of veterans' legislation that the Federal Government's primary responsibility is to assist the service disabled. Veterans' needs unrelated to their military service have been dealt with differently than service-connected needs, sometimes through special programs and sometimes through programs for the whole population. In recognition of this, President Kennedy last January stated in his budget message that— This country has recognized that the Government's primary obligation for veterans benefits is to those who incurred disabilities in the defense of our Nation and to the dependents of those who died as a result of military service ***. Emphasis in veterans programs should continue to be placed on benefits and care for the service disabled. This policy recognizes that veterans are increasingly benefited by the rapidly expanding general health, education, and welfare programs of the Government. Excluding these general benefits, total Federal payments for veterans programs in 1964 are estimated at $6 billion. (Of the $6 billion, $2.4 billion are for non-service-connected benefits.) For serious service-connected disability, veterans very properly receive substantial compensation which they can use to maintain themselves in nursing homes. They are also entitled to medical care outside VA facilities as well as to first priority for admission to VA hospitals. A principal effect of the bills under consideration by your committee is to extend nursing home benefits to veterans for conditions not arising from military service. We do not believe extension of this new type of assistance is justified and question the provision of additional preferential benefits to veterans for non-service-connected ailments or needs on a number of grounds. Basically, the needs of veterans which do not arise out of their military service are in the same category as the needs of other citizens who are infirm, chronically ill, or without income. Moreover, since veterans as a group are better educated, have better jobs, and higher incomes than nonveterans, there is no economic justification for singling them out for additional special benefits. It is particularly significant that even those over age 65 have substantially higher incomes than nonveterans. Mr. EVERETT. From what source do you draw the observation from that veterans have better jobs than the average citizen? Is that your own personal opinion? Mr. HUGHES. No, sir; this is from data derived I think principally from the 1960 census and in part from the studies of the Bradley Commission. Mr. EVERETT. Any questions? Go right ahead. Mr. HUGHES. Further, and as your committee is fully aware, the Federal Government is already providing substantial benefits to veterans who are without service-connected disabilities. Under existing laws the Federal Government is obligated to spend for our present 22 million veterans and their dependents in the neighborhood of $300 billion in the years to come, of which on the order of three-fourths will be for pensions, hospital and medical care, and other benefits and services for needs unrelated to military service. The portion of these benefits unrelated to military service already gives veterans a significant advantage over other citizens whose needs are as great and whose means are significantly less adequate. The tremendous cost of these programs reflects the fact that veterans and their families represent nearly half of our whole population. Broadening existing programs or creating additional programs is likely to produce a staggering and, in our view, inequitable, financial burden on the taxpaying public. Nursing home care for the nonservice disabled has been justified on the grounds that it would lead to economies in the operation of VA hospitals. Currently about 3,700 veterans are occupying beds in VA hospitals and it is argued they could be shifted to nursing homes where the per patient costs are substantially cheaper. However, upon closer analysis several points appear which cast a good deal of doubt upon the probability of any actual savings. First, the potential nursing home patients occupy only about 3 percent of the beds in VA hospitals-not a significant proportion. To complicate matters, such patients are invariably scattered around in different hospitals. Mr. EVERETT. From what source do you get those figures, the 3,700? Mr. HUGHES. Those are from the Veterans' Administration figures. Mr. EVERETT. Yesterday, as I recall, and I would like to have Mr. Patterson refresh my memory, approximately 10 percent of these beds are frozen according to their testimony yesterday. COUNSEL. About 9,700 patients, yes, sir. This is just about 10 percent of the system Mr. EVERETT. Also, Mr. Hughes, do you have an investigative staff in the Bureau of the Budget to go out and look at these hospitals or is all the information you are able to obtain from statistical information from the VA itself? Mr. HUGHES. The basic data we get would be from the Veterans' Administration itself. Mr. EVERETT. You do not have anyone that goes from the Bureau of the Budget and looks at the hospitals and sees the condition they are in, or visits the patients or anything like that? Mr. HUGHES. We do have budget examiners who make field trips to VA hospitals. The Bureau staff, though, is relatively small and we would depend basically upon the VA for statistical information and basic data about the character of its patient load. Mr. EVERETT. Approximately how many men would you have for this investigative staff from the Bureau of the Budget working with the Veterans' Administration? Mr. HUGHES. In our office? Mr. EVERETT. Approximately. Mr. HUGHES. We have one man on the operating program and one man on construction and another part time-about two and a half, sir, working on medical programs. Another three work on nonmedical programs. Mr. EVERETT. Any questions, Mr. Schadeberg? Mr. SCHADEBERG. No. Mr. EVERETT. Go right ahead. Mr. HUGHES. With respect to the seeming discrepancy between the 3,700 beds and 10,000 beds, I did not hear yesterday's testimony, but I think there may be a question of semantics here, revolving around frozen beds, so called, versus patients suitable to receive nursing home care. I am not sure of that, but I suggest that is a possibility. Moreover, while nursing home care is undoubtedly less expensive than hospital care, the savings to the VA may not be as great as would appear on first sight. The Veterans' Administration has effected many of the economies possible in the case of those patients requiring only nursing-home-type care, and this has resulted in lower per diem costs overall. Thus, any savings from transfer to special nursing home facilities would probably be at least partially offset by increases in average costs on regular beds. Further, it would be costly to provide suitable beds in existing VA hospitals for nursing-home-type care. Many of the beds which the VA hospitals have reported to the committee as possible of conversion to nursing home use are in structures which are scheduled for replacement. |