Hospital Cost Containment Remarks Announcing Proposed Legislation.

THE PRESIDENT. Today I am submitting to the Congress one of the most critical anti-inflation legislative proposals that the Congress will ever consider, the Hospital Cost Containment Act of 1979.

Inflation remains our most serious domestic problem. It affects every person and every institution in this country. Inflation threatens the health not only of our domestic economy but of the basic structure of our own society.

The American people want me, and they want the other elected representatives, to take action, action that is strong, prompt, and effective. Ten years ago, the average cost of a stay of a patient in a hospital was $533. In just the past 2 years alone, this has increased by $317. It's a total now, for the average stay in the hospital of a patient, of $1,634.

These uncontrolled hospital costs are now doubling every 5 years.

When hospital costs go up, so do health insurance premiums. That pushes up consumer prices. It pushes up the budgets. It pushes up taxes at all levels of government. The only thing that goes down is the real income and the purchasing power of the American family.

Hospital cost containment is unique in two ways: It's uniquely severe in that it has been going up about twice the rate of other inflation in this country, and it is uniquely controllable if I and the Congress will act expeditiously and effectively.

We can eliminate thousands of untilled, expensive hospital beds. We can stop subjecting people to unnecessary surgery and useless and unnecessary, very expensive medical tests. We can cut out pointless duplication of exceedingly expensive medical facilities.

Over the next 5 years, if this bill is passed, the American people will save some $53 billion. The American people will save $53 billion, of which $22 billion would be reduced Federal taxes and reduced Federal spending, without cutting back the quality of medical care at all.

Hospital cost containment will not be achieved without a difficult fight. Together with the Senators and the Members of Congress who are here with me today, I will lead the fight on behalf of the American people.

The hospital lobby defeated hospital cost containment legislation last year, although the Senate did pass an administration-sponsored cost contained bill. That lobby opposing this legislation is even more determined this year, and it's equally well financed. But this year, we have a new Congress and a new opportunity to bring the outrageous increases in hospital costs under control.

The patience of the American people is wearing thin, and rightly so. It's time for the public interest to prevail. It's time for the Congress to demonstrate its commitment to the battle against inflation by promptly enacting the hospital cost containment of 1979.

We have with us today several congressional leaders who proved their commitment to this problem—the solution of it-last year. Senator Nelson is the sponsor this year of this legislation. Senator Talmadge, Senator Kennedy worked effectively last year to get the legislation through the Senate. Congressman Waxman, Congressman Rangel are two key subcommittee chairmen who will be responsible this year for action in the House in the commerce committee and, also, of course, in the Ways and Means Committee.

And others assembled behind me are equally determined that we shall control inflation by this very specific act that only the Congress can take this year to control inflation and to show our effectiveness and our determination to remove this blight from the American economic and societal scene.

Thank you very much.

I'd like to ask now if Senator Talmadge would like to make a comment, and then I'll call on others who have been so determined over many years to bring this very serious problem under control.

SENATOR TALMADGE. Thank you, Mr. President. I think you covered the issue very well. I have nothing to add to what you had to say, sir. THE PRESIDENT. Thank you very much.

REPRESENTATIVE RANGEL. Mr. President, I'd just like to say that I support your efforts. I think that this time the patients, the consumers, who don't have trustees, will have the President of the United States and the Congress behind them.

And while I haven't studied your legislation, I am assured that it would make certain that the underserved communities are not adversely affected by the shrinkage in hospital services. And I thank you for that commitment.

THE PRESIDENT. Thank you very much, Congressman Rangel.

Congressman Rangel is chairman of the subcommittee in the Ways and Means Committee of the House. Congressman Waxman is chairman of the equivalent subcommittee in the commerce committee of the House.

REPRESENTATIVE WHEELMAN. Well, Mr. President, I want to work with you to get this bill passed. It's an important measure for us to handle the inflation in health care costs. It's something that we need very badly. And it's going to be a tough fight, but I think we're going to win it, because I think the American people want it.

THE PRESIDENT. Very good.

SENATOR KENNEDY. Mr. President, I think we've seen or heard a great deal of rhetoric about dealing with the problems of inflation up on the Hill over the period of the last few weeks. I think this will be a key opportunity for the Members of Congress to do something about it, in supporting your efforts.

As you pointed out, this legislation was killed by special interests in the last Congress. And the American people will have a full opportunity to see who really is interested in dealing with the problems of inflation. And we're going to report that legislation out very expeditiously and look forward to working with you and the administration in getting it achieved.

THE PRESIDENT. Last year, the floor leader, and this year's sponsor of the legislation, was Senator Gaylord Nelson. I wish you'd make a comment, Senator Nelson.

SENATOR NELSON. Mr. President, I want to commend you and the Secretary of HEW for designing what I think is a very creative piece of legislation, in the sense that it allows the hospitals to meet a standard rate of increase comparable to about the national rate, voluntarily, with no imposition of any controls whatsoever, as has been demonstrated by a number of States already can be done. Therefore, it's a voluntary effort, without any Federal interference, if the hospitals bring their own costs under control. I think it's a very good and creative approach.

And I would agree with Senator Kennedy that those who've been talking so much about economy will now have a chance to help balance the budget and reduce inflation.

THE PRESIDENT. Thank you very much. We have many other very distinguished Members of the Congress here with us-Jack Javits, chairmen of several of the committees, Pete Williams. Does anyone else care to comment?

Congressman Staggers?

REPRESENTATIVE STAGGERS. I'll just say that last year we failed in our committee, but we did the best we could. And we certainly had an advocate in [Representative] Paul Rogers, very vociferous, who did everything in his power. And I tried to help him get it by the full committee. The subcommittee passed it and brought it before the full committee, but we could not get it by the full committee. We need your help, and we need Joe's ¹ help, and we need anyone else that you can bring [laughter] -

¹ Secretary of Health, Education, and Welfare Joseph A. Califano, Jr.

I would like to say in conclusion, good luck on your trip abroad. I wish you success.

THE PRESIDENT. Thank you very much.

SENATOR JAVITS. Mr. President, I probably interject a note of bipartisanship, which I think is urgently needed. It's everybody's fight. And secondly, I would hope very much that we will show the American people that quality care is not dependent upon waste. Squeezing out the waste and making the facilities over, rather than underutilized, dispensing with extra beds which aren't needed and other things which cost great sums of money will give the people a higher quality of care at prices they can more nearly afford.

THE PRESIDENT. Thank you. Pete?

SENATOR WILLIAMS. Well, I just want to say this subject will have the highest priority in the Human Resources Committee, as I'm sure it will in the Finance Committee, our committee, and Senator Kennedy's subcommittee will start hearings immediately, Friday of this week; the highest priority, we'll stay on track.

THE PRESIDENT. Thank you.

REPRESENTATIVE RANGEL. I'd like to add, Mr. President, that the chairman of the full Committee of Ways and Means is prepared to schedule hearings on March 12, and I've checked with Chairman Waxman and understand there's been clearance there, so we'll start immediately.

THE PRESIDENT. Thank you. I might say that I appreciate the good wishes of Congressman Staggers on my trip to try to get a peace treaty in the Middle East. But I would say within the most careful terms that successfully dealing with inflation in our country and around the world is of equal importance.

And this is a very profound subject with which we are dealing. I was not exaggerating when I said that continued inflation, if uncontrolled, will be a threat not only to our own American economy but to the basic societal structure of our country. So, domestic affairs and foreign affairs are intimately interrelated. And how forcefully and effectively the Congress deals with this issue will be a vivid demonstration of the will that our American people have to face difficult problems under trying circumstances.

And I feel reassured, as I always have since I've been in this office, in having the support and the confidence and a sense of partnership with the distinguished leaders of the Congress of the United States. Thank you very much.