of the AMA: How can this be done? One of the most radical solutions

IS the completely laissez-faire pro- posal recently put forward by Professor Milton Friedman of the University of Chicago that licen- sure should be eliminated as a re- quirement for the practice of med- icine His argument may be sum- marized as follows : Licensure is the key to the control that the AMA exercises over the number of phy- sicians The AMA, perhaps the strongest trade union in the United States, lnnlts the number of peo- plewhso can practice medicine. Its essential control is at the stage of admission to medical school. Med- ical schools are approved by the AMAs Council on ,Medical Educa- tion;an4jpospltals., To stay on the approved list, ,a,# school I must meet the standards set by the council. The councils appTova1 is crucial for the continued existence of a medi- cal school since in almost every state in the United States, a person must be licensed to practice medi-

cine, andto get the license, he must be a graduate of an approved school. I n almost every state, the list of ap- proved schools IS identical with the hst of schools approved by the Coun- cil. . . . That is why the licensure provision is the key to the effective control of admisslon. By directly exerting pressure on medical schools to restrict admissions, as it did in the 1930s, (or Indirectly, by raising quality standards, the AMAs Council on Medlcal Education and Hospltals has reduced the supply of physicians.

In place of licensure, Professor Friedman would substitute the free- dom to practice medicine without restriction except for the legal and financial responsibility for anv harm done to others through L$+ud and negligence. The major reser- vation I have concerning Professor Friedmans proposal, and it is a cqucial reservation, is my doubt that a completely free market can pro- duce medical services of adequate quality. The need for quality is the

Impact .of Medicare . : . I . Washington, D.C.

Medicare will be the most sweep- ing new departure in American SO- clal legislation since Roosevelts Social Security Act thirty years ago. That description, culled from one of the many news accounts of House passage of the bill, already has deadened into a clichk. All analysts have accepted the fact of medicares great impact, bur: very few have bothered to delve into the detads of that impact. How will America and medicine change after medicare?

Only a fool would try to predict this with certainty. A bill. espe- cially one 296 pages long, has by- ways and tremors and lurking com- mas that can twist society in a manner no one anticipates. Yet some trends can be spotted ahead of time. Medicare has the potential to confirm doctors fears that fed- eral pressures will change the way they practice medicine. It also has the potential to stuff a financial bonanza into the pockets of Amer-

icas at-cat doctors.

Stanley Meisler is u frequent Nation ,contributor.

The bill, which is sure to become law some time Ithis summer. states that nothing in it shall be con- strued to authorize any federal of- fxer or employee to exercise any supervision or control over the practice of medicine or the man- ner in which medical services are provided. Yet the bill also exacts standards of institutions ehat take part in the program. While theFe standards are not, at least initial- ly, to be federally administered, they do amount to a form of fed- eral influence and pressure for im- provemelits that medicine has not accbmplished itself.

Every hospital under medicare would have to follow the lead of the most progressive hospitals, and appoint a committee to review cases pehodically, to see that no doctor was keeping his patient in the hospital too long. This is a standard not now required for ac- creditation by the American Hos- pital Association and one that most doctors resent. These utilization re- view committees-made up of hos- pital physicians, nurses and ssocial workers-would be set up to in- sure efficient use of the hospital

basic reason for societys willing- ness to grant organized medicine substantial power to set standards for medical education.

The two extreme and diametri- cally opposed approaches of placing almost complete poder in the hands of organized medicine, and of reli- ance upon a see market, suggest a third alternative: greater lay con- trol over the licensure of physicians and the admisslons pollcies of med- ical schools, with organlzed medi- cine playing an essentially advisory role Such an arrangement would make i t possible to give due consid- eration to the need for quality, and at the same time would provide a necessary check Ion the use of qual- ity standards as a device for un- , duly, restrictmg the quantlty of medical,> services supplied While such an approach might not com- pletely eliminate the Inherent con- tradictions in the con,cept of pro- fessionalism, it would lessen con- slderably theu socially undesirable effects.

Stanley Meisler

,and to guard against tlie tendency of some patients-with their doc- tors approval-to stay in a hospital for as long as their insurance will pay for the bed. The bill does not detail the criteria a utilization re- view committee must, use, but the mere inclusion of the provision creates a mechanism for checking oli the judgment of doctors.

,Another provision of the bill allows a doctor to transfer a pa- tient no longer in need of intense hospital care to a nursing home for twenty to eighty days of free care, a i d this may prove a boon to the overtaxed hospitals. Some hospital people feel the bill errs by requir- ing the doctor to put the patient in a hospital first; they believe the doctor should have the right to send the patient to the numing home initially if he feels that that is the best way of handling 1 the illness. There is some expecta- tion that doctors will solve Ithe prob- lem by putting a patient in a hos- pital for the allowed minimum of three days and then, transferring him to the nursmg home. This would be a clear waste of money

479 Mug 3, 1965

- since hospitahatlon costs are four tlmes as hlgh as those oi 11~11b- ing homes

Still a third plovlslon 111 the brl l allows fedcral pressure on medlc,~l practices IronlcaIly. this WJS ~ C I L mto the b1ll by- Rep Wilbur Mrlls ( D . Ark ) . chalrmm of the I4ousc Ways and Means Committee. a t the request of the AMA. whlch has screamed for years about the dancer 01 federal mterference The pro\l- slon prohlblts any allocation of the hospltallratlon beneflts as payment for the ser1lces of the anesthesl- ologlst, pathologlst. radlolog~st or other medlcal speclallst attached to the hosptal. Each of these doctors would have to bill the pntlent separately.

Thls p r o h ~ b ~ ~ ~ o n - w h ~ h may be deleted 117 the Senate-would r e p resent R victory for the AMA 111 o l ~ e o l 11s long-time fcuds with the AIIICKIC~II I-lospltal A S S O C I ~ ~ ~ O I I Thy A I l A wants hospltds to senre as comprehensive medlcal centers ready to treat patients 111 an or- gmlzed, economwal, efflclent way 2he AMA. on the other h ~ n d . wants hospitals to ser\e as workshops 1n whlch ~ndlvldual enlrepreneur phy- :iclans ply their trade In recent years. the trend has favored the AHA, and most rndlologlsts. pathol- oglsts and other sprclahsts ha\c acceplcd an :11rangemcnt that put them wldcr h o s p ~ t d a d m m ~ s t ~ ,I-

tlon and provided them with a per- centage of the charges

Medicare - AS passed by the House-mould dlscourage hospltals irom making arrangements that would draw these speclallsts m t o :I comprehcns~ve medical center In thc lony run. says Eugene D. Mor- 11s. adm~nlstralor of Edward Hos- pltal of Napervllle, Ill., it would reduce the hospital to llttle more than a nursmg home Sen Paul D o u g l ~ s ( D , I11 ) recently ga1.e Congress an example of what mlght happen ~f a pathologist was a prl- vate entrepreneur and not undcr the admlnlstratlon of the hospltal

At the present time, the hospital pathologrst can go lnto a medical s l d i meeting and tell Dr Feesplll- tcr that 25 per cent of the tissue hc removed WIS normal. . The pa- thologlst has thls freedom to cllti- c1le because he 1s p a d by the 110s- p 1 1 a 1 . and hls rcspons~blllty IS to thc hospltal Thls freedom oi act1011 would be serlously lmpalred by the present House provision The pa- thologist would be dependent upon referrals from physlclsns such a s Dr Feesplitter for hls lncome

The p r o v ~ s ~ o n also would cre- ate an adrnlnlstrat~ve quagmire as m c I y speclalist rn the hospltal p ~ e - sented hls separate bill to the pa- k n t . and as the hospltal flgrlrcd out the perccntage of laboratory

480

charges, for example, to be billcd by thc pathologist I have seen an estlmale made by the director of a m q o r hospital in the East. savs Sen Flank Moss ( D Utah that mdloloysts on that hospltal stalf would have to i55ur about 3.000 s e p ~ r a t e bills per month

Besldes these present sourccs O F federal pressure. the bill also has deuces to increase that pressu~c 111 the future I f , for examplc. the fcrleral qovernment became d ~ s s , ~ - tlsf~ed wlth the work of the ut~llza- tlon revlew commlttees, It is con- cplvable that the government could d~ctate the cr~terla that the com- mlltees must use The b ~ l l sets I I ~ a vehlcle for such declslons-thc> National Medical Revlew Commlt- tee. comprismg nine representat~vcs of lhc medwal flelds. including a t l c ~ s t ~ I V C doctors It shall be t h v lunct~on of the commlttee. the blll says. to study the utdl~;lt1011 o f hospital and other medlcal c a w a l l d swwces . with a wcw to ~ ~ 0 1 1 1 - mendmg any changes Tht: commlttecs ,urnual report could c t - Ecct significant lmpro\wmenls 111 the program and 111 the way nrcdl- cine IS pract~ced

Some mfoxmed opmlon has nl- ready urged the federal govcrn- m m t LO use medlcarc as n club t o pound somc medical sense ~ n t o hos- pllnls 2nd doctors Dr. Frank FUI- stenberg, medlcal director of Smai Ilosp~txls outpawnt depll trnellt I I I Ralt~rnorc. told the Tousc Ways ~ I I I C I h l c m s Commlttec) The fLlnd 1ls~li sh(1~11d not slmply l,ecomc\ a \endor- p.lyng agcncy. as ~ndecd. i l l many Instances. the Blue Cross has been . Now. when we step inlo the program of the use ol federal f u n d s , thcsr lunds should be. It seems to us^ 11sed 111 such a fashion that scns~tlv-e serwce will be given. that tllerc wrll be standards lor the SCIV- ICYS. arid LhIl thls should be kcpt under a puhllc agencys authority."

The extent to whlch the goy- ernment lollows Dr Furstenbergs nt luce may depend on two Iactors whether Blue Cross becomes a medl- C:II behemoth adrnlnistermg the proyam far lhe federal govern- ment. and whether the AMA h:ls enough power left to reslst new fed- eral controls and pressures

pr Health Education and Welfare to contract much of the adminlstrn- tlve work of the medicare program

?he NATION

The bill cncourages the Secretary ,

to private organizations. Blue Cross would like to do the whole job. Walter J. McNerney, president of the Blue Cross Association: told the House Ways and Means Commit- tee at the executive hearmgs this year tIiat the medical profession is still quite antsy about , . .manip- ~tlati6n from the outside. This same profession, although It doesnt always welcome it, is at least fairly .used to dealing with an agency such as ours. . . . But, as Rep ,M,artha W Griffiths (D., Mich.) and Dr. -Furstenberg have pointed out, Blue Cross is so closely tied up with hospitals and doctors that it perhaps would not engage in snf- ficiently stringent regulation Mrs. Griffiths, noting that 17 per cent osf Blue Cross board members were doctors, said: I think it would be very difficult to get into the sltua- ,tion where you are having doctors reviewing the prices charged by doctors ind in which they are prof- iting. There should be someone who is f a r removed from any pos- sible statement by the public that

doctors are meachmg into the tax- payers pocket and getting rich. Federal pressures on American medicine would be lessened if Blue Cross acts as -a buffer between the federal government and organized mcdicme.

The American Medical Asso- dation has so tarnished its image in the savage battle against medi- care that it may find no one will-

, ing to listen to another outcry against federal encroachment. The AAMA may have screeched wolf too often At the end of the battle in the House, the AMA was even iso- lated Born all Republicans but one on the Ways and Means Commit- tee. I n fact, the AMA performance atthe final commibtee hearings was SO childish as to defy belief Dr. Donovan Ward, AMA president, mached in waving a clipping from the St. Louis Globe Democrat about a, still secret study which showed that the medicare fund would be depleted by 1976. Later the com- mittee discovered ithat this still secret study:-based on lower taxes #than the bill provided-had been prepared by the Eocial Security Ad- mmistration and handed to a n AMA representative who,had asked for it. The AMA then evidently planted it with the Globe Democrat.

Medicare will have impact on areas other tkian the role of govern- May 3, 1965

ment in medicine. One is the wealth o doctors. Despite the prolonged bad temper of the AMA, the bills combination of compulsory hos- pitalization insurance and volun- tary medxxd insurance hands bene- fits to doctors where it pleases them most-their pocketbooks. ,

Smce many more people over 65 will be paying customers rather than charity patients, then- im- proved chance for care wlll mean money for doctors. Every benefit provlded by the bill-either in the hospitalization dr Fedical programs -hinges on some certification by a physlcian. The bill wlll not pay or diagnostic services, hospitaliza- tmn, nursing-home care or home- care visits unless a doctor has au- thorized them. Each authokization means a fee.

No one yet has estimated the size of the bonanza that medicare promises for Americas doctors, but two figures hint at i t . The total cost of health care for Americans over 65 was more than $5 billion last year.\ Blue Cross, government and private insurance witnesses have told the House Ways and Means Committee that the bdl sure- ly would increase the use of hcos- pitals by the aged, estimates vary from 10 to 40 per cent in the first ye ass,

The bills emphasis on nursing- home facilities should encourage the construction and staffing of these facilities ,Public Health Serv- ice figures showed that the US. had only, 3251000 acceptable nursing- home beds last ye= to meet a need for 840,000 beds. In short, even withouit the stiqulation of medi- care, the United States had less than 40 per cent of its needed beds. Under the bill, certain standards are set for nursing homes. Perhaps the most important: every hove must have twenty-four-hour nursing services, with at least one regis- tered nurse on duty at all times. The nursing-home association says only half the nations 10,000 skill- ed nursing homes would qualify now.

Finally: the bill may en- cousage Americans under 65 to push fqr health insurance for them- selves. The history of all social legislation is evidence that pres- sures for expansion build up quick- h . During the mediczne debate it- self, Rep. George M. Rhodes (D., Pa ) suggested that Congress re-

duce the social secuTity retirement age fsom 65 to GO.

#One way of financing expanded benefits was suggested by Sen. Rob- ert F. Kennedy (D., N.V.) in a recent speech to the National Coun- cil 1011 the Aging. He proposed a limited use of general revenue fi- nancing for the [social security] s y s t e ~ . He said it was no longer the case ;that the worker gets out durmg the years of retirement what he put in durhg the worhng years. Kennedy said that we are now

-

providing benefits ftodeserving peo- I ple who properly were not asked to pay for them. But we are doing , so out of payroll contributions of others Kennedy predicted that general tzm revenues will go up $30 billion by 1970, and I think we can certainly afford to contrib- ute some of this to social security.

When the social security rate gets higher and Americans. begin to realize they are paying a tax and not an insurance premium, there may be less compunction about using the general tax reve- nues to pay for health insurance and social security\ benefits. In fact, some use of general revenues has started already: the government, for example, mll coiltribute $3 a month toward every enrolled per- sons voluntary medlcal insurance.

Medicare may have its most pro- found impact on American society if its pressures lead to the day wllen the. federal government uses gen- eral revenues to pay for more pen- sions and health insurance than it. does now. Financing these through social security alone follows the principle thalt every. man has the right to help himself. Financing thFse through general revenues as well recognizes that self-help alone cannot do an adequate job and that every man has the right to ex- peet his government to help him to a pension and health +wurance. That, in fact, would be a sweeping new departure in American socal legislation. r-

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